Although all economic and financial departments were harnessed to the task of the Four-Year Plan under the leadership of General Field Marshal Goering, Germany's economic preparation for war was also secretly advanced in another sector for well over a year, namely, through the formation of a national guiding apparatus for special war economy tasks which would have to be accomplished the moment that war became a fact. For this work all economic departments were combined into one administrative authority, the Plenipotentiary General for Economics, to which position the Fuehrer appointed me one and a half years ago.

From Funk's IMT testimony: Yes, that was the activity of the Plenipotentiary for civilian economy. I already explained that this morning. I did not speak of Poland ... the preparations were not made for a specific war. It was a general preparation. I do not believe that I was so presumptuous as to want to get Goering's post. That was far from being my intention. I had very little ambition at all.

From the post-war interrogation Dr. Posse:

Q: What was the nature of the conflict between the Plenipotentiary for Economy and the Four Year Plan?

A: The struggle for power.

Q: The struggle for power between Funk and Goering?

A: The struggle for power between Funk and Goering, between Funk and the Ministry for Agriculture and the Ministry of Communications.

Q: How was the struggle finally resolved?

A: Never. It was a struggle always continuing under the surface . . . .

Q: Did Funk, who had very important powers as Minister of Economics and later as Reichsbank President and as Chief Plenipotentiary for Economy, actually exercise these powers?

A: Yes. But the powers of Goering were stronger.

Q: Nevertheless, Funk did exercise important powers?

A: Yes, as President of the Reichsbank, Minister of Economics, and Plenipotentiary for Economy.

From Funk's IMT testimony: Yes [Posse was a chief deputy], but Posse's position was somewhat apart. My deputy was Landfried, and in the Reichsbank, Puhl. They knew these things better than Herr Posse. They should know more about it than Posse. No, [he didn't know what he was talking about].

As the Plenipotentiary for Economy appointed by the Fuehrer, I must see to it that during the war all the forces of the nation should be secured also from the economic point of view. The contribution of economy to the great political aims of the Fuehrer demands not only a strong and unified direction of all the economic and political measures, but also above all careful co-ordination.... Industry, food, agriculture, forestry, timber industry, foreign trade, transport, manpower, the regulation of wages and prices, finance, credits must be coordinated, so that the entire economic potential should serve in the defense of the Reich. In order to fulfill this task, the authorities of the Reich in charge of these spheres are included in my authority in my capacity as Plenipotentiary for Economy.

From Funk's IMT testimony: First, at that time I was no longer Plenipotentiary for Economy. I was never plenipotentiary for the armament industry. The powers of the Plenipotentiary for Economy, shortly after the beginning of the war, were turned over to the Delegate for the Four-Year Plan. That has been repeatedly confirmed and emphasized and what I did personally at that time concerning economy in the Occupied Eastern Territories can only have been very, very little. I do not remember it because the administration of economy in the Occupied Eastern Territories was in charge of the Economic Staff East and the Delegate of the Four-Year Plan, and that office, of course, co-operated with the Rosenberg Ministry for the Occupied Eastern Territories. Personally I remember only that, as I mentioned yesterday, in the course of time the Ministry of Economics sent individual businessmen, merchants, from Hamburg and from Cologne, et cetera, to the East in order to secure private economic activities in the Eastern Occupied Territories.

From Building of the Third Reich (Das Dritte Reich in Aufbau) by Hans Queeke, an official of the German Ministry of Economies: A task of special political significance and economic importance arose as an absolute necessity out of the National Socialist conception of state and economy, namely, the eradication of Jewish influence from the economy. In this connection, a wealth of legislative and administrative work, though temporary, was created for the Ministry. The steps of the work were as follows: definitions of the term 'Jewish enterprise', registration of Jewish property, securing the 'deployment' of such property in accordance with the interests of the German economy, exclusion of Jewish employees from executive positions, and, finally, re-examination of steps taken in the de-Judaization of enterprises with a view to ordering payments to the Reich for the unjust profits secured in the process of de-Judaization. That task can now be considered as practically completed in the field of the industrial economy.

From Funk's IMT testimony: We continuously delivered coal, coke, iron, and other raw materials in France, so that they could produce goods--we delivered especially those raw materials which the French did not have in the country themselves. There was a very active exchange of production and a very close productive cooperation between the German and French economy. Even the same organizational methods were used.

From Funk's IMT testimony: On my fiftieth birthday the President and Directorate of the Reich Chamber of Economics, the chief organization of the entire German economy, called on me and declared that because of my more than 20 years of service to German economy they wanted, with the approval of the Fuehrer, to make me a gift of an estate in Bavaria. That was a doubtful present, for later I had much worry and trouble because of it. A large house was built there because, as I was told, the Fuehrer had said that he also wanted me to work there. The taxes were so high, however, that I could not pay them, nor the remaining construction costs, either. Thereupon I did not appeal to Goering, but Goering heard about it and had 300,000 Reichsmark given to me in order to help me out of my financial straits. I did not receive any money from Goebbels, but with the approval of Goebbels the film corporation joined the Chamber of Economics in giving me this money.

When the Fuehrer heard of the difficulties I had in paying taxes and making other payments he put a sum of 500,000 Reichsmark at my disposal. With the other money I received I made two donations, one of 500,000 Reichsmark to the Reichsbank for the families of the members of the Reichsbank killed during the war and another of 200,000 Reichsmark to the Reich Ministry of Economics for the families of members of that office who died in the war. I was able to live in, and pay for the upkeep of, this large house and grounds only because I had a relatively large income. However, from the beginning, when I saw the tremendous costs and expenses connected with it particularly in taxes, et cetera, I decided, in agreement with my wife, that after my death this estate should again be donated either to the Reichsbank or to my East Prussian homeland. I also discussed this several times with the Reichsbank Directorate.

From 1931 on, Walter Funk, as personal economic adviser and Plenipotentiary of the Fuehrer for Economics, and therefore the untiring middleman between the Party and German economy, was the man who paved the way to the new spiritual outlook of the German industrialists.

If in the outbreak of 1933 the differences which had existed for more than a decade in the public life of Germany between politics and economy, and especially between politics and the industrialists, disappeared overnight, if from the outset, the guiding rule of all labor has been an ever-increasing contribution towards a common end, this is due to the pioneering work of Funk, who since 1939 has directed his speeches and his writings to that end . . . .

Walter Funk remained true to himself because he was, and is, and will remain a National Socialist, a fighter who dedicates all his work to the idealistic aims of the Fuehrer.

From Funk's IMT testimony: I did not know anything about that article beforehand. I did not order a birthday article for myself. But I find that the tendency of the article is generally very good.

It is very probable that military action on our part will very soon be followed by the military collapse of the USSR . . . . After the military collapse of the Soviets in Europe, very small forces would be needed to dispose of the Moscow tyranny in Central Asia.

From Funk's pre-trial interrogation:

Q. I want to ask you whether you didn't know it as early as the 20th of April 1941, when there was a decree by the Fuehrer appointing Rosenberg to take charge of eastern territory?

A. Well, that I don't know. I don't know whether I have seen that decree.

Q. Don't you remember appointing Schlotterer to be your secretary?

A. Yes, but I don't remember whether that was on that date.

Q. Don't you remember that it was several months before the attack on Russia?

A. That I don't know. I can't remember exactly when I detached Schlotterer for duty with Rosenberg, but it must have been after the nomination of Rosenberg. It also tallies with the date of my conversation with Hess towards the end of April. It was during the last days of April in Munich. It was then that Hess asked me whether I was aware of the fact that a war with Russia was threatening.

Q. What did you say?

A. I said, yes, that sort of thing is being talked about, naturally. And then Hess asked me, as I have told you before, how things stood regarding the Russian deliveries, and whether the loss of such deliveries would not be serious.

Q. I want to refresh your recollection. You make it very difficult sometimes. The Fuehrer issued an order on the 20th of April 1941 appointing Rosenberg as a deputy for a centralized treatment of problems concerning the eastern territories?

A. I don't know whether I saw that. Well, I don't know. I can't say that. You would have to ascertain whether this decree was passed on the department. That wasn't so easy in our case.

Q. Isn't it a fact that this decree of the 20th of April 1941 by the Fuehrer was a very secret decree which was shown only to Goering, Funk and Keitel?

A. I don't know that. If you say so it must be correct. But I don't remember it; I don't know.

Q. Look, you keep saying that you knew nothing about high policy and that you were only a small man in effect.

A. Yes, I was.

Q. Now here we have a decree which is the first step towards the preparation of the war against Russia, and the only people in the Reich who were permitted to see it were Hitler, Lammers, that is the State Secretary, Keitel, Chief of the OKW, Goering, the delegate for the Four-Year Plan, and yourself.

A. In that case it must have been that this decree was only sent to the ministers who were members of the Defense Council of the Reich, and I was one of them, and that is possible.

Q. But regardless of that, I want to ask you now whether you don't remember seeing the decree as early as two months before the attack on Russia?

A. Well, yes, if it has been ascertained that it has been sent to me I must have seen it, but I cannot now remember that. It is possible, but I cannot deny it; it is so long ago.

Q. In any event, based on this decree or based on this conference with Hess, and the other knowledge you had before that conversation, it is clear that in April 1941, you knew that a war with Russia was in contemplation?

A. That a conflict with Russia was threatening.

Q. And you knew that you had to mobilize your resources for an attack on Russia within a reasonable period of time?

A. Well, I didn't have any mobilizing to do in that connection. All I had to do was to place at Rosenberg's disposal Schlotterer and various other people when his ministry opened. I wouldn't introduce any measures in economy in this particular case. All this could concern was the strengthening of armament, which was not under my jurisdiction; but it was Goering's and the OKW's concern.

Q. But it also had to do with the exploitation of the eastern territory after it was occupied?

A. Yes, but that was a task for the Four-Year Plan.

Q. In which you appointed Schlotterer to cooperate with Rosenberg?

A. Yes. I delegated him to Rosenberg, and Rosenberg, as far as these parts were concerned, was also subordinate to the Four-Year Plan; because the only department which could give orders in that connection on economic subjects was the Four-Year Plan.

Q. But Schlotterer was put in there to be an economic adviser to the whole problem of the taking of properties out of the eastern countries, was he not?

A. Yes, but only so far as the east. And as far as Rosenberg was concerned, I tried to avoid that Rosenberg should open a new organization, which is what he was proposing to do.

Q. Why were you against that?

A. Because this would have created another ministerial competitor on economic questions. We had enough competitors. We had the Four-Year Plan, and this would have introduced another one.

Q. So that you didn't want to give up the jurisdiction over economic matters in the eastern territories to Rosenberg; is that it?

A. Well, jurisdiction isn't right. I wanted to avoid yet a new organization, and the handling of the matter was Rosenberg's concern. Therefore I detached Schlotterer and various other people to Rosenberg's office, and they did of course retain their connections with my office.

Q. What kind of connections did they continue to have with you?

A. They concerned mainly the collecting of consumer goods, because the raw material questions and some such business was handled by the Four-Year Plan, in particular Pleiger. It was together with Rosenberg that we created those firms in the east, that is to say, we took firms in the Reich who has to carry out business in the occupied eastern territories. They had to buy out of their won funds. But nothing much materialized because the Army had already collected a very considerable amount of things. And as far as the important materials were concerned, such as coal, oil, etc., that was already being handled by the Four-Year Plan and taken out. And the only subject on which I cooperated with Rosenberg, as far as the eastern territories were concerned, was that of these firms. But matters of an important nature, such as the collection of factories, smelting works, electric works, etc., that was dealt with outside the Ministry of Economics and I believe also outside of Rosenberg's organization.

Q. But there is evidence, Funk that every firm that got anything in the east had to go to you and Goering and get the agreement of both of you before they could do anything.

A. No.

Q. Now, in connection with consumer goods that you controlled, were coal mines included in that?

A. No. Raw materials from occupied territories came under the Four-Year Plan.

Q. I am not talking about the occupied territory; I am talking about in general.

A. Oh, I see. In 1941, coal mines in Germany still came under the Ministry of Economics.

From Hans Heinrich Lammers' IMT testimony: [What I told Funk before the invasion of the USSR] must have been what I knew myself at the time, namely, information which the Fuehrer had given me, that troop concentrations in Russia had been observed, which allowed the conclusion to be drawn that an armed conflict with Russia might occur. These were the words the Fuehrer used. He believed that things would come to a head with Russia and therefore wished that one man, and that was Rosenberg, should concern himself with Eastern questions, since the possibility of an armed conflict with Russia did exist. That is probably what I told Funk. I cannot imagine what else I could have told him. It is possible that [I mentioned not only troop concentrations on the Russian side along the Eastern frontier of Germany, but also the Russian march into Bessarabia]. The Southeast, at any rate; and perhaps I mentioned that the discussions which had taken place with Russia, with Molotov, were unsatisfactory.

From Funk's IMT testimony: Up to the time of this Trial I did not even know what the Einsatzstab Rosenberg was, what its tasks were, what it was doing. I have no knowledge that the Ministry of Economics had anything at all to do with the safeguarding of cultural treasures. I cannot say anything about it . . . . I said that the reason given us for that appointment was that the Fuehrer considered a war with Russia to be possible ... Lammers has said that here, too . . . .

From the beginning I assigned Ministerial Director Dr. Schlotterer to Rosenberg, so that only one economic department, the competent department for the Minister for the Eastern Occupied Territories, would work in Russia, and not two. These transactions were handled by the Economic Department East which, I think, came under the Four Year Plan. As far as I know these transactions were not handled by Minister Rosenberg and certainly not by the Ministry of Economics . . . .

[My interrogation] testimony [above] is completely confused, because Schlotterer joined the Rosenberg Ministry. He became head of the economic department there. Also, this testimony is not true to this extent, since we certainly sent more machines into Russia than we took out of Russia. When our troops came to Russia everything had been destroyed, and in order to put the economy there in order, we had to send large quantities of machinery and other goods to Russia. Those answers are not correct. I say what I said is wrong.

The Chief of the Reich Chancellery has sent me a copy of the Fuehrer's directive appointing you his plenipotentiary for dealing with questions relating to eastern European territories.

From Hans Heinrich Lammers' IMT testimony: Either the Fuehrer told me to do so--which I do not think was the case--or I believed that from the economic point of view Funk would be interested in this information. I passed it on to him as a special personal gesture; I do not remember any particular reason now. I certainly must have passed the same message on to others, but not in writing; the others probably received it orally. There was no question at all of an aggressive war when Rosenberg was given that task by Hitler. He was supposed to be merely a sort of political commissioner for the Eastern Territories. He was to study the conditions of the peoples there.

From Funk's IMT testimony: I knew nothing about an aggressive war against Russia. I was very much surprised when I learned from Lammers that the Fuehrer had made Rosenberg plenipotentiary for Eastern European problems. Lammers stated here that he had me advised of this nomination for personal reasons, because he knew that I was very much interested in economic relations with Russia. Indeed, our mutual efforts, Russia's as well as Germany's, had succeeded in considerably expanding our trade relations; for in earlier times, that is, before the first World War, German trade with Russia had been the decisive factor in the balance of German trade and had amounted to several thousand million gold marks.

The Russians--I must say this here--furnished us grain, manganese ore, and oil very promptly, while our deliveries of machines lagged behind for the natural reason that the machines had first to be produced since the Russian orders were mainly for specialized machines. To what extent army supplies were sent to Russia, I do not know, as I did not deal with these.

And so I was surprised by the appointment of Rosenberg. He called on me for a short discussion in which he told me that the task given to him by the Fuehrer also included handling of economic problems. Thereupon I placed a ministerial director in my ministry, Dr. Schlotterer, at Rosenberg's disposal to work on these problems. And when the Ministry for Eastern Affairs was founded, as far as I know, in July, Dr. Schlotterer, with some of his colleagues, took over the direction of the economic department in Rosenberg's Ministry. And simultaneously, as far as I remember, Dr. Schlotterer became a member of Economic Operational Staff East. This was the institution of the Four Year Plan which has been mentioned repeatedly here during the proceedings and which dealt with all economic problems in the Occupied Eastern Territories.

Beyond that, I had nothing to do with these matters. Naturally I asked Lammers as well as Rosenberg just what this signified, and both of them told me that the Fuehrer was of the opinion that a war with Russia would become unavoidable, that along the entire Eastern Front the Russians had concentrated large reinforcements, that the discussions with Molotov, in which I had no part at all, had been unsatisfactory, that the Russians were making demands regarding the Baltic, the Balkan regions, and the Dardanelles, which could not be accepted by Germany, by the Fuehrer. At any rate, this affair was as complete a surprise to me as to the German people, and I am convinced that this war was a great shock to the German people. The discussion with Rosenberg was at the end of April or the beginning of May 1941, and the Rosenberg Ministry was founded in July 1941 . . . .

As to the question of the American prosecutor, I did not understand it to mean that I knew anything about an aggressive war against Russia. The prosecutor spoke explicitly about preparations for war with Russia. I myself had already made it quite clear that I was completely surprised when the task was assigned to Rosenberg, and I was informed by Dr. Lammers as well as by Herr Rosenberg, that the reason for the assignment was that the Fuehrer was expecting a war against Russia, because Russia was deploying large numbers of troops along the entire eastern border, because Russia had entered Bessarabia and Bukovina and because his negotiations with Molotov brought proof that Russia maintained an aggressive policy in the Balkans and the Baltic area, whereby Germany felt herself threatened. Therefore preparations had to be made on the part of Germany for a possible conflict with Russia.

Also, concerning the meeting which the American prosecutor has mentioned, I said explicitly that the measures concerning currency which were discussed there were approved by me, because we created thereby stable currency conditions in the Occupied Eastern Territory. I was therefore opposed to the idea that the German Reichsmark, which the Russian population would not have accepted because they could not even read it, should be introduced there.

From Funk's IMT testimony: I knew nothing of an attack. I only knew of an imminent danger of war. Since the appointment of Rosenberg--and I explained that quite clearly this morning--I knew that a war with Russia was threatening. I said quite clearly this morning that I was informed that the Fuehrer was expecting a war with Russia, but I am not sure about this document, as to who has written it ... it is important insofar as these things about the ruble have been attributed to me. It says here that I said that the use of the Reichskreditkassenscheine and the determining of the rate of exchange involved considerable danger. In other words, I was very doubtful in regard to the proposals made in this respect.

The vast territories of the eastern European region, containing raw materials which have not yet been opened up to Europe, will become the promising colonial territory of Europe.

From Funk's IMT testimony: I have not said that. I said that I did not speak about colonial territories, but of the old colonization areas of Germany. The area had been conquered already. We did not have to conquer that. That had been conquered by German troops. Not only [was I the President of the Continental Oil Company, a company organized for the exploitation of the oil fields of the Occupied Eastern Territories] of the Occupied Territories--this company was concerned with oil industries all over Europe. It had its beginnings in the Romanian oil interests and whenever German troops occupied territories where there were oil deposits, that company, which was a part of the Four-Year Plan, was given the task by the various economic offices, later by the armament industry, of producing oil in these territories and of restoring the destroyed oil-producing districts. The company had a tremendous reconstruction program. I personally was the president of the supervisory board and I mainly had to do the financing of that company only. We had not conquered the Caucasus and therefore the Continental Oil Company could not be active in the Caucasus.

For Hitler and his followers there is no punishment on this earth commensurate with their crimes. But out of love for coming generations we must make an example after the conclusion of the war, so that no one will ever again have the slightest urge to try a similar action. And do not forget the petty scoundrels in this regime; note their names, so that none will go free! They should not find it possible, having had their part in these abominable crimes, at the last minute to rally to another flag and then act as if nothing had happened!

From Funk's IMT testimony: These moneys were not given by me. They were given from the fund of the Fuehrer by Lammers. I did not dispense such moneys. Yes [I was President of the Reichsbank], but these moneys never came from the Reichsbank. These were moneys from funds that were administered by Lammers and I assume that the moneys came from the Adolf Hitler donation or from other funds. But the Reichsbank had nothing to do with these funds.

From Goering's IMT testimony: At my suggestion, my urgent suggestion, the Fuehrer created a Ministry of Munitions under the then Minister Todt. This strictly munitions ministry became, in the course of further developments, the Armaments Ministry under Minister Speer, and gradually more and more tasks were transferred to it. As armament was the focus of the whole economy and everything else in economy had to be brought exclusively into this focus, a number of tasks of the Ministry of Economics were transferred to the Ministry of Armaments, in particular the whole of production. It is correct that in the end the Ministry of Economics, by and large, was left a hollow shell retaining only very subordinate departments . . . .

I know of the Central Planning Board. I never interfered in their internal matters. I cannot state exactly when Funk was called to this board. With the recruiting of foreign workers, however, he had nothing to do.

The aim of this new, gigantic labor mobilization is to use all the rich and tremendous sources, conquered and secured for us by our fighting Armed Forces under the leadership of Adolf Hitler, for the armament of the Armed Forces and also for the nutrition of the homeland. The raw materials as well as the fertility of the conquered territories and their human labor power are to be used completely and conscientiously to the profit of Germany and her allies.

With a view to assuring priority of armaments as ordered by the Fuehrer, and to embrace all the demands which are thereby made on the total economy during the war, and in order to bring about an adjustment between a secure food supply and the raw material and manufacturing facilities in the economy, I order: In connection with the Four Year Plan a Central Planning Board shall be organized . . . . Point C: The distribution of existing raw materials, especially iron and metals, among the places requiring them. Point B: The decision as to the creation of new plants for production of raw materials, or enlargement of the existing plants.

From Hans Heinrich Lammers' IMT testimony: I believe that Funk's only interest in the Central Planning [Board] was to receive raw materials for civilian production. That was his interest in the Central Planning, since he was responsible only for the distribution of these economic goods, and civilian production had been transferred to Minister Speer. Thus Funk was, of course, very interested in raw materials; but the employment of labor, in my opinion, interested him very little, since he did not have enough raw material at all to allow civilian production to go on.

From Funk's IMT testimony: The meeting which you mention is concerned with the deployment of labor. I myself had no direct connection with that, and the Foreign Minister probably did not have any marked interest in it either. So I assume that for these reasons the Fuehrer did not need me, for as I said yesterday his directives for the conduct of economy were given, up to the year 1942, to the Reich Marshal as the man responsible for that field, and after 1942 the directives were given to Speer, because from that date on armaments dominated the entire economic life, and all economic decisions, by express order of the Fuehrer, had to give way to armament needs. I should like to state my position on various matters, but the details of these problems can naturally be better explained by the state secretaries than by myself.

Concerning the directives to occupied territories, the Reich Marshal, as well as Reich Minister Lammers, has stated here that I, as Reich Minister for Economics, had no authority to issue instructions. The Reich Marshal, during his testimony here, stated, and I marked it down, "For the directives and the economic policies carried out by the Minister of Economics and Reichsbank President Funk, the responsibility is fully and exclusively mine."

And concerning the occupied territories, he also said that if I had issued special instructions in the course of official business between the ministry and the administrative offices in the occupied territories, then they derived from the general directives of the Reich Marshal and, as he said, were always based on his personal responsibility.

The position was that directives to the occupied territories in the economic field could only be given by the Delegate for the Four-Year Plan. The carrying out of economic policy was the task of the military commanders or the Reich commissioners who were directly subordinate to the Fuehrer. The military commanders, as well as the Reich commissioners, had under them officials from the various departments; among them, of course, also officials from the Ministry of Economics and the Reichsbank; and even private enterprise was represented. There was, of course, close cooperation between the offices of the military plenipotentiaries, the Reich commissioners, and the representatives of the various home departments, with the exception of occupied territories in Russia where the Reich commissioners were subordinate to a special minister, that is, the Reich Minister for the Occupied Eastern Territories'. This was an exception, but if we as a ministry wanted to have anything done by the military commanders or the Reich commissioners, we had to make a request or procure an order from the Delegate for the Four-Year Plan.

The same applies to the heads of the civil administration in Alsace-Lorraine and in other territories where a civil administration had been set up. Here also, the numerous departments of the Ministry of Economics and the Reichsbank had no direct authority to issue directives.

However, I emphasize again that of course close official contact existed between the directing authorities in the occupied territories and the respective departments in Germany.

I myself--and witnesses will confirm this in questionnaires still outstanding, or in person--made the greatest efforts to protect the occupied territories from exploitation. I fought a virtually desperate struggle throughout the years for the maintenance of a stable currency in these territories, because again and again it was suggested to me that I should reduce the exchange rate in the occupied territories so that Germany could buy more easily and more cheaply in these countries; I did everything that could be thought of to maintain economic order in these territories. In one case, in Denmark, I even succeeded, in the face of opposition from all other departments, in raising the value of the Danish krone, because the Danish National Bank and the Danish Government requested it for justifiable reasons.

I opposed the increase of occupation costs in France in 1942 as well as in 1944. The memorandum of the Reichsbank which I authorized was quoted here by the American Chief Prosecutor.

The occupation costs were determined not by the Minister of Economics and the President of the Reichsbank but by the Minister of Finance and the Quartermaster General--in other words, by the highest Wehrmacht commands--and in the case of France, Denmark, and other countries, also by the Minister for Foreign Affairs.

Therefore, I did whatever I could possibly do--whatever was within my power--to keep the economy of the occupied territories in good order. I was successful finally in persuading the Reich Marshal to issue a decree which prohibited all German personnel from buying on the black market; but that happened only after many abuses in this respect had already occurred.

I want to emphasize also that I considered it necessary for the maintenance of order in the occupied territories that social life there should not be disturbed, and that, therefore, as a matter of principle I was always against the forced or excessive deportation of foreign workers from the occupied territories to Germany.

I also expressed this in a conference with Lammers, which has been mentioned here. My state secretaries can confirm that. On the other hand it was naturally clear to me that Sauckel was in a very difficult, indeed desperate, situation. Again and again manpower for German economy was demanded of him. But, particularly after I had turned-over the entire civil production to Speer and engaged in central planning, it was not only not to my advantage, from the point of view of my work, that manpower was brought to Germany from abroad, but it was indeed in my interest that the workers should remain in the occupied territories since the production of consumer goods had been transferred to a large degree to these territories; for as minister responsible for providing consumer goods to the population I had a great interest in seeing that orderly work should be done in the occupied territories and that no economic or social disturbances should occur.

I believe, however, that it will be more to the purpose if my two state secretaries and the Vice President of the Reichsbank, the acting Director of the Reichsbank, Puhl, make detailed statements on these problems, because they were more closely connected than I with carrying matters into practice.

If the accusation is made against me that with the aid of the clearing arrangements we spoiled occupied territories and foreign countries, I can only say that the clearing arrangement was not originally introduced by us in our dealings with the occupied territories or during the war, but that it was the normal method of trade between Germany and her business partners. It was a system that had been forced upon us--and that has been pointed out by Schacht--when other nations resorted to using the proceeds of German exports for the payment and amortization of German debts.

At all times, however, I have emphasized that the clearing debts' were real debts for merchandise, and that is important. I have said again and again that this clearing debt was a genuine debt of the Reich and would be repaid at the rate, the purchase value which was in force at the time when we entered into these obligations. I especially stated that, in detail and as clearly as possible, in my last speeches in Vienna in March 1944, and in Koenigsberg in July 1944.

Beyond that, in July, I made the suggestion that after the war the clearing debt should be transformed into a European loan, so that it should not remain on the narrow plain of a bilateral exchange of goods but be effectively commercialized; from this can be seen distinctly that I always considered that clearing debt a genuine debt, so that the nations--the occupied territories who had such claims on Germany could and would be satisfied with the war--and, as I constantly emphasize, at the same rates that existed at the time when the debt was incurred. If, however, the countries would have had to pay reparations on the basis of peace treaties, then these reparations of course, quite reasonably, could only have been paid in goods; and then, equally reasonably, it would have been possible to create a balance between German debts and German claims.

But I never left any doubt about the fact that the clearing debt was to be considered a true debt. Therefore, I have to reject the accusation that with the aid of the clearing system we exploited the occupied territories. And I have to reject even more strongly the accusation that I share responsibility for the burden of unbearable expenses, particularly occupation costs and other outlays of money, which were imposed on the occupied territories. It can be proved that I always objected to excessive financial burdening of the occupied territories. The witnesses will later testify and confirm this.

In answer to my letter of 25 April 1942 ... 100 million Reichsmark were put at my disposal from the Occupation Cost Fund by the OKW. This amount has already been disposed of except for 10 million Reichsmark, since the demands of the Roges (Raw Material Trading Company), Berlin, for the acquisition of merchandise on the black market in France, were very heavy. In order not to permit a stoppage in the flow of purchases that are made in the interest of the prosecution of the war, further amounts from the occupation cost fund must be made available. According to information from Roges and from the economic department of the Military Commander in France, at least 30 million Reichsmark in French francs are needed every 10 days for such purchases.
As, according to information received from Roges, an increase of purchases is to be expected, it will not be sufficient to make available the remaining 100 million Reichsmark in accordance with my letter of 25 April 1942, but over and above this, an additional amount of 100 million Reichsmark will be necessary.

From Funk's IMT testimony: That the Roges made such purchases' is true. These things have already been dealt with here in connection with the orders and directives that the Four-Year Plan gave for these purchases on the black market. However, these are purchases that were arranged and approved by the state organization. What we especially fought against were the purchases without limits in the black market. I already mentioned yesterday that I finally succeeded in getting a directive from the Reich Marshal that all purchases in the black market were to be stopped because through these purchases naturally merchandise was withdrawn from the legal markets. In 1943 I believe a great deal was still coming from France. There was continuous production going on in France and it was considerable. The official French statistics show that even in 1943 large quantities of the total production were being diverted to Germany. These quantities were not a great deal less than in 1941 and '42.

Goering: How much butter do you deliver? 30,000 tons?

Lohse: Yes.

Goering: Do you also deliver to Wehrmacht units?

Lohse: I can answer that too. There are only a few Jews left alive. Tens of thousands have been disposed of, but I can tell you that the civilian population gets, on your orders, 15 percent less than the Germans.

From Funk's IMT testimony: But what Goering told me then refers to the fact that, a long time after the Russian territories had been occupied, we sent businessmen there to bring into those territories any goods that might interest the population. For instance it says here: "Businessmen must be sent there.... We must send them to Venice to buy up these things in order to re-sell them in the occupied Russian territories." That is what Goering told me on that occasion. At least, that is what can be read here.

... The law is not an end in itself. Its function is to maintain public order...All means used to this end are justifiable...It must adapt itself to this end...The idea that the judge is there to give absolutely irrevocable judgement, even if the world should come to an end as a result, is nonsense... (Maser)

From Funk's IMT testimony: Business with the SS? I have never done that. I never started business with the SS. I can only repeat what I said in the preliminary interrogation. Puhl one day informed me that a deposit had been received from the SS. First I assumed that it was a regular deposit, that is, a deposit which remained locked and which was of no further concern to us, but then Puhl told me later that these deposits of the SS should be used by the Reichsbank. I assumed they consisted of gold coins and foreign currency, but principally gold coins, which every German citizen had had to turn in as it was, and which were taken from inmates of concentration camps and turned over to the Reichsbank. Valuables which had been taken from the inmates of concentration camps did Not go to the Reichsbank but, as we have several times heard here, to the Reich Minister of Finance . . . .

Herr Puhl--I do not remember in what year--told me one day that a gold deposit had arrived from the SS and he also told me--and he said it somewhat ironically--it would be better that we should not try to ascertain what this deposit was. As I said yesterday, it was impossible in any case to ascertain what was deposited. When something was deposited, the Reichsbank had no right to look into it to see of what it consisted. Only later, when Herr Puhl made another report to me, did I realize that when--he used the word "deposit" it was a wrong term--it was not a deposit but it was a delivery of gold. There is of course a great difference. I personally assumed that it concerned a gold deposit, that this gold consisted of gold coins or other foreign currency or small bars of gold or something similar, which had been brought in from the inmates of the concentration camps--everybody in Germany had to hand these things over--and that it was being handed to the Reichsbank, which would use it.

Since you mentioned this matter, I remember another fact of which I was not conscious until now. I was asked about it during my interrogation, and during this interrogation I could not say "yes" to it because at that time I did not remember it. I was asked during my interrogation whether I had the agreement of the Reichsfuehrer that the gold which was delivered to the Reichsbank should be utilized by the Reichsbank. I said I did not remember. However, if Herr Puhl makes such a statement under oath, I will not and cannot dispute it. It is evident that if gold were delivered which should come to the Reichsbank, then the Reichsbank had the right to utilize such gold. I certainly never spoke more than twice or at most three times to Herr Puhl about this matter. What these deposits or these deliveries consisted of and what was. done with these deliveries, how they were utilized, I do not know. Herr Puhl never informed me about that either.

No [we were not in the habit, in the Reichsbank, of accepting jewels, monocles, spectacles, watches, cigarette cases, pearls, diamonds, gold dentures, etc.]; there could be no question, in my opinion, that the bank had no right to do that, because these things were supposed to be delivered to an entirely different place. If I am correctly informed about the legal position, these things were supposed to be delivered to the Reich Office for Precious Metals and not to the Reichsbank. Diamonds, jewels, and precious stones were not the concern of the Reichsbank because it was not a place of sale for these things. And in my opinion, if the Reichsbank did that, then it was unlawful. If that happened, then the Reichsbank committed an illegal act. The Reichsbank was not authorized to do that.

Yes, I was [frequently in the vaults of the bank], where the gold bars were kept. It was the usual thing if someone came to visit us, particularly foreign visitors, to show them the rooms where the gold was kept and we always showed them the gold bars and there was always the usual joke as to whether one could lift a gold bar or not. But I never saw anything else there except gold bars. They were the usual gold bars which were used in commerce between banks. I think they varied in weight. I think the gold bars weighed about 20 kilograms. Of course, you can figure it out. I was in the vaults at the most four or five times and then only to show this very interesting spectacle to visitors. It was not more often. I only went down there with visitors, particularly foreign visitors.

The business of the Reichsbank was not conducted by the President. It was conducted by the Directorate. I never bothered about individual transactions, not even gold transactions, or even about slight variations in the individual gold reserves, et cetera. If large deliveries of gold were expected, the Directorate reported to me. The Directorate conducted the business, and I believe the detailed transactions were probably known only to the director responsible for that particular department.

[Funk is shown a film taken in Frankfurt when the Allied Forces captured that city and went into the Reichsbank vaults, which contain, among other things, gold bridgework and the other dental work.]

I have never seen anything of this sort. I also have the impression that a large part of these things which were shown in the film came from deposits, because people, thousands of them, had locked deposits which they delivered to the Reichsbank, in which they put their jewels and other valuables, as we have just seen. Probably some were hidden valuables, which they should have given up, such as foreign money, foreign exchange, gold coins, et cetera. As far as I know we had thousands of closed deposits into which the Reichsbank could not look. I never saw a single item such as these shown in the film, and I cannot imagine where these things came from, to whom they belonged, and to what use they were put. As far as the teeth are concerned, this is a special case. Where these teeth came from I do not know. It was not reported to me, nor do I know what was done with those teeth. I am convinced that items of this sort, when they were delivered to the Reichsbank, had to be turned over to the Office for Precious Metals, for the Reichsbank was not a place where gold was worked. Neither do I know whether the Reichsbank even had the technical facilities to work this metal. I do not know about that. These things are, of course, no regular deposits. That goes without saying . . . .

I was completely confused by this film and most deeply shocked. Photography and especially films are always very dangerous documents because they show many things in a light different from what they really are. I personally have the impression, and I believe the Prosecution will probably corroborate this, that all these deposits of valuables and this entire collection of valuable items came from the potassium mines where, at my instigation, all gold, foreign currency and other valuables of the Reichsbank had been stored away when, because of a terrific bombing attack on Berlin, we were no longer able to work in the Reichsbank.

The Reichsbank building alone in this one raid on 3 February 1945 was hit by 21 high explosive bombs; and it was only by a miracle that I was able to reach the surface from this deep cellar together with 5,000 other people. Gold, foreign currency, and all other deposits of valuables were then taken to a potassium mine in Thuringia and from there apparently to Frankfurt, I assume. So this concerns, to a large extent, normal deposits by customers who had placed their valuables, their property, in these safe deposits which could not be got at by the Reichsbank. Consequently I cannot tell from this film which of these items were deliveries by the SS and which were genuine deposits.

The Prosecutor certainly is correct when he says that no one would deposit gold teeth in a bank. It is, however, quite possible that certain functionaries of concentration camps made genuine deposits in the Reichsbank which contained such articles, to safeguard them for future use. I think that is possible. However, in conclusion I must say once more that I had no knowledge whatsoever of these things and of the fact that jewelry, diamonds, pearls, and other objects were delivered from concentration camps to the Reichsbank to such an extent. I knew nothing about it; it was unknown to me, and I personally am of the opinion that the Reichsbank was not authorized to do this kind of business.

It is certainly clear from one document, which contains an account for the Minister of Finance, that most likely everything from the concentration camps was first brought to the Reichsbank and then the unfortunate officials of the Reichsbank had to sort it, send it on to the Minister of Finance-or rather to the pawnbroker who was under the Minister of Finance-and prepare a statement of account. Therefore, I must request that someone be examined on these matters-first of all Herr Puhl himself, and perhaps someone else who was concerned with these things-in order to explain what actually took place and above all, to show that I personally had no knowledge whatsoever of these matters except for the few facts which I myself have described to the Court.

From the affidavit of Emil Puhl:

1. My name is Emil Puhl. I was born on 28 August 1889 in Berlin, Germany. I was appointed a member of the Board of Directors of the Reichsbank in 1935 and Vice President of the Reichsbank in 1939, and served in these positions continuously until the surrender of Germany.

2. In the summer of 1942 Walter Funk, President of the Reichsbank and Reich Minister of Economics, had a conversation with me and later with Mr. Friedrich Wilhelm, who was a member of the Board of Directors of the Reichsbank. Funk told me that he had arranged with Reichsfuehrer Himmler to have the Reichsbank receive in safe custody gold and jewels for the SS. Funk directed that I should work out the arrangements with Pohl, who, as head of the economic section of the SS, administered the economic side of the concentration camps.

3. I asked Funk what the source was of the gold, jewels, banknotes, and other articles to be delivered by the SS. Funk replied that it was confiscated property from the Eastern Occupied Territories, and that I should ask no further questions. I protested against the Reichsbank handling this material. Funk stated that we were to go ahead with the arrangements for handling the material, and that we were to keep the matter absolutely secret.

a. I then made the necessary arrangements with one of the responsible officials in charge of the cash and safes departments for receiving the material, and reported the matter to the Board of Directors of the Reichsbank at its next meeting. On the same day Pohl, of the economic section of the SS, telephoned me and asked if I had been advised of the matter. I said I would not discuss it by telephone. He then came to flee me and reported that the SS had some jewelry for delivery to the Reichsbank for safekeeping. I arranged with him for delivery and from then on deliveries were made from time to time, from August 1942 throughout the following years.

5. The material deposited by the SS included jewelry, watches, eyeglass frames, dental gold, and other gold articles in great abundance, taken by the SS from Jews, concentration camp victims, and other persons. This was brought to our knowledge by SS personnel who attempted to convert this material into cash and who were helped in this by the Reichsbank personnel with Funk's approval and knowledge. In addition to jewels and gold and other such items, the SS also delivered bank notes, foreign currency, and securities to the Reichsbank to be handled by the usual legal procedure established for such items. As far as the jewelry and gold were concerned, Funk told me that Himmler and Von Krosigk, the Reich Minister of Finance, had reached an agreement according to which the gold and similar articles were on deposit for the account of the State and that the proceeds resulting from the sale thereof would be credited to the Reich Treasury.

6. From time to time, in the course of my duties, I visited the vaults of the Reichsbank and observed what was in storage. Funk also visited the vaults from time to time.

7. The Golddiskontobank, at the direction of Funk, also established a revolving fund which finally reached 10 to 12 million Reichsmark for the use of the economic section of the SS to finance production of materials by concentration camp labor in factories run by the SS.

I am conversant with the English language and declare that the statements made herein are true to the best of my knowledge and belief.

From Funk's IMT testimony: I declare that this affidavit by Herr Puhl is not true. I spoke to Herr Puhl about the entire matter of these gold deposits, as I have repeatedly stated, three times at most, but I believe it was only twice. I never exchanged a word with Herr Puhl regarding precious stones and jewelry. It is incredible to me that a man who most certainly also carried out certain functions in his agreements with the SS-that is, with Herr Pohl-now tries to put the blame on me. On no account will I take this responsibility and I request that Herr Puhl be called here, and that in my presence he may declare in all detail when, where, and how he has spoken to me about these different items, and to what extent I told him what to do.

I repeat my statement that I knew nothing about jewelry and other deliveries from concentration camps, and that I have never spoken to Herr Puhl about these things. I can only say again what I said at the beginning, that Herr Puhl once told me that a gold deposit had arrived from the SS. I remember it now, it had escaped me as I did not pay too much attention to the entire matter. I remember that, urged by him, I spoke to the Reichsfuehrer about whether the Reichsbank could utilize these items. The Reichsfuehrer said, "Yes." But at no time did I speak to the Reichsfuehrer about jewelry and precious stones and watches and such things. I spoke only of gold.

Concerning what Puhl states about a financing scheme--I believe that goes back a number of years--I know Herr Puhl came to me one day and said that he was asked to give a credit for certain factories of the SS and somebody was negotiating with him about the matter. I asked him, "Is this credit secure? Do we get interest?" He said, "Yes, up till now they have had a credit from the Dresdner Bank and it must now be repaid." I said, "Very well, do that." After that I never heard anything more about this matter. It is news to me that this credit was so large, that it was made by the Golddiskontobank. I do not remember it, but it is entirely possible. However, I never heard any more about this credit, which Herr Puhl had given to certain factories. He always spoke about factories, about businesses; it was a bank credit that had previously been given by a private bank. I remember I asked him once, "Has this credit been repaid?" That was some considerable time later. He said, "No, it has not been repaid yet." That is all I know about these matters . . . .

Herr Puhl told me one day, I believe in 1939 or 1940, that some gentlemen from the economic section of the SS had spoken to him regarding a credit, which until that time had been granted by the Dresdner Bank and which they would now like to have from the Reichsbank. I asked Herr Puhl, "Will we get interest; is the credit secure?" He said, "Yes." So I said, "Give them this credit," and later on I said just what I mentioned above. That is all I know about the matter. I know nothing more. I do not know anything about any payment from the SS . . . .

If the Board of Directors did not report to me about these things, I cannot have known about them, and I declare again quite definitely that I was not informed about these details. On one occasion I was told about a gold deposit of the SS which was brought to us. Later on it transpired that it was a delivery from the SS. And then I knew about this credit transaction. That is all I know about these matters . . . .

I cannot tell more to the Tribunal than I have already said, that is the truth. Let Herr Puhl be responsible before God for what he put in the affidavit; I am responsible for what I state here. It is absolutely clear that Herr Puhl is now trying to put the blame on me and to exculpate himself. If he has done these things for years with the SS, it is his guilt and his responsibility. I have only spoken to him two or three times about these things, that is, about the things I have mentioned here. He is blaming me and I repudiate that.