ONE HUNDRED AND TWENTY-THIRD DAY
Tuesday, 7 May 1946

Morning Session

[The Defendant Funk resumed the stand.]

MR. DODD: Witness, you had a conference with Dr. Sauter last night after we recessed Court, did you not, for about an hour?

FUNK: Yes.

MR. DODD: Now we were talking yesterday, when the Tribunal rose, about the gold deposits in the Reichsbank, and I had asked you when you started to do business with the SS, and as I recall, you said you did not do any business with the SS. And then we went along a little further and you did say that the SS did deposit some materials, some property belonging to people in concentration camps. Do I properly understand your testimony to have been, in substance, as I have stated it?

FUNK: No. I said that 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 Publ 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

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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.

MR.DODD: Well now, let us see. You were not ordinarily in the habit, in the Reichsbank, of accepting jewels, monocles, spectacles, watches, cigarette cases, pearls, diamonds, gold dentures, were you? You ordinarily accepted that sort of material for deposit in your bank?

FUNK: No; 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.

MR.DODD: That is exactly right.

FUNK: If that happened, then the Reichsbank committed an illegal act. The Reichsbank was not authorized to do that.

MR. DODD: And is it your statement that if it was done you did not know anything about it?

FUNK: No.

MR. DODD: You did not know?

FUNK: No.

MR.DODD: You were frequently in the vaults of the Reichs bank, were you not? As a matter of fact you liked to take visitors through there. I say, you were frequently in the vaults of the bank yourself?

FUNK: Yes, I was, where the gold bars were kept.

MR.DODD: I will come to the gold bars in a minute. I just want to establish that you were in the vaults frequently, and your answer, as I understand it, is "yes" that you were?

FUNK: 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.

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MR. DODD: How heavy were these gold bars that you had in the vaults?

FUNK: 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. If one...

MR.DODD: That is all right. That is satisfactory. When you were in the vaults you never saw any of these materials that I mentioned a few minutes ago-jewels, cigarette cases, watches, and all that business?

FUNK: Never. I was in the vaults at the most four or five times and then only to show this very interesting spectacle to visitors.

MR. DODD: Only four or five times from 1941 to 1945?

FUNK: I assume so. It was not more often. I only went down there with visitors, particularly foreign visitors.

MR.DODD: Are you telling the Tribunal that as head of the Reichsbank you never made an inspection, so to speak, of the vaults, never took a look at the collateral? Did you not ever make an inspection before you made your certifications as to what was on hand? Certainly every responsible banker does that regularly, does he not? What is your answer?

FUNK: No, never. 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.

MR. DODD: Now, did you ever do any business with pawnshops?

FUNK: With what?

MR. DODD: Pawnshops. Do you not know what a pawnshop is? There must be a German word for that.

FUNK: Pfandleihe.

MR. DODD: Whatever it is, you know what they are, do you not?

FUNK: Where you pawn something.

MR. DODD: Yes.

FUNK: No, I never did any...

MR. DODD: All right, we will get to that a little later too. Right now, since you do not seem to recall that you ever had any or saw any such materials as I have described in your vaults, I ask that we

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have an opportunity to show you a film which was taken of some materials in your vaults when the Allied Forces arrived there.

[Turning to the President.7 I would ask, Mr. President, that the defendant be permitted to come down, where he can watch the film, so that his memory will be properly refreshed.

THE PRESIDENT: Yes, you may have him brought down.

[Moving pictures were then shown.7

THE PRESIDENT: Mr. Dodd, at some stage, I take it, you will offer evidence as to where that film was made.

MR: DODD: Yes, I will. There will be an affidavit as to the circumstances under which the film was made, who was present, and why; but, for the information of the Tribunal, it was taken in Frankfurt when the Allied Forces captured that city and went into the Reichsbank vaults. .

[Turning to the defendant.7 Now, Witness, having seen these pictures of materials that were found in your Reichsbank vaults a year ago, or a little earlier than a year ago, you now recall that you did have such material on hand over a period of 4 or 5 years, 3 or 4 years, 3 years-I think actually a little longer than 3 years?

FUNK: 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.

MR.DODD: Well, that is an interesting answer. I asked you yesterday, and I ask you again now, did you ever hear of anybody depositing his gold dentures in a bank for safekeeping? [There was no response.7

You saw that film, and you saw the gold bridgework, or mouthplates, did you not, and the other dental work? Certainly nobody ever deposited that with a bank. Is that not a fact?

FUNK: 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

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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.

MR. DODD: And not only did people not deposit gold teeth, but they never deposited eyeglass rims, did they, such as you saw in the picture?

FUNK: That is right. These things are, of course, no regular deposits. That goes without saying.

MR. DODD: And you saw there were some objects that obviously were in the process of being melted down. Practically the last scene in that film showed something that looked as if it had been in the process of being melted, did it not? You saw it?

Well, will you answer me, please, "yes" or "no"? Did you see it?

FUNK: I cannot say that exactly. I do not know whether they were melting it down. I have no knowledge of these technical matters. To be sure, now I see quite clearly what was not known to me until now, that the Reichsbank did the technical work of melting down gold articles.

MR. DODD: Well, now, let us see what your assistant, Mr. Puhl, says about that, the man who you told us yesterday was a credible gentleman, and whom you asked the Tribunal to call as a witness on your behalf. I am holding in my hand an affidavit executed by him on the 3rd day of May 1946 at Baden Baden, Germany.

"Emil Puhl, being duly sworn, deposes and says:

"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

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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."

Document Number 3944-PS; it is signed by Emil Puhl and duly witnessed.

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Mr. President, I would like to offer this affidavit as Exhibit USA-846 and the film as Exhibit USA-845.

[Turning to the defendant.7 Now, Witness, having heard this affidavit from your close associate and your brother director of the Board of Directors of the Reichsbank, and the man who, you admitted yesterday was a credible and truthful man, what do you now say to this Tribunal about your knowledge of what was going on between your bank and the SS?

FUNK 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 which 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

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said, "No, it has not been repaid yet." That is all I know about these matters.

MR.DODD: All right. Now, what do you know about this-one part of the affidavit you have not covered-what do you know about the last part that says you established a revolving fund for the SS for the building of factories near the concentration camps? Do you remember that? I read it to you. Puhl says, "The Reichsbank, at the direction of Funk, 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." Do you admit that you did that?

FUNK: Yes, that is what I just mentioned; that 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.

MR. DODD: Now, you also got a fee for handling these materials that you saw in the film, did you not, from the SS? The bank was paid for carrying on its part of this program?

FUNK: I did not understand that.

MR. DODD: I say, is it not a fact that you received payment from the SS over this period of more than 3 years for handling these materials which they turned over to you?

FUNK: I do not know about that.

MR. DODD: Well, you would know, would you not, as President of the bank, if you did receive payment? How could you help knowing?

FUNK: These were probably such small payments that no one ever reported them to me. I do not know anything about any payment from the SS.

MR.DODD: What would you say if I tell you that Herr Puhl said that the bank did receive payment during these years, and that there were altogether some 77 shipments of materials such as you saw here this morning? Do you say that is untrue, or do you agree with it?

FUNK: That might be quite true, but I was never informed about these things. I know nothing about it.

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MR. DODD: Is it conceivable that you, as President of the Reichsbank, could not know about 77 such shipments and about a transaction that you were being paid to handle? Do you think that is a likely story?

FUNK: 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.

MR. DODD: Now, let me tell you something that may help you a little bit. As a matter of fact, your bank sent memoranda to people concerning this material from time to time, and I think you know about it, do you not? You made up memoranda stating what you had on hand and whom you were transferring it to. Are you familiar with any such memoranda?

FUNK: No.

MR. DODD: Well, then you had better take a look at Document Number 3948-PS, Exhibit USA-847, and see if it refreshes your memory. That is 3948-PS.

[The document was handed to the defendant.]

- Now, this document is a memorandum apparently addressed to the Municipal Pawn Brokerage in Berlin, and it is dated 15 September 1942. Now, I am not going to read all of it, although it is a very interesting document, but as you can see, the memorandum says, "We submit to you the following valuables with the request for the best possible utilization." Then you list 247 platinum and silver rings, 154 gold watches, 207 earrings, 1,601 gold earrings, 13 brooches with stones-I am just skipping through; I am not reading all of them-324 silver wrist watches, 12 silver candle sticks, goblets, spoons, forks, and knives, and then, if you follow down here quite a way, diverse pieces of jewelry and watch casings, 187 pearls, four stones said to be diamonds. And that is signed "Deutsche Reichsbank, Hauptkasse" and the signature is illegible. Perhaps, if you look at the original, you might tell us who signed it.

FUNK: No, I do not know who signed it.

MR.DODD: You have the original?

FUNK: I do not know.

MR.DODD: Well, look at the signature there and see if you recognize it as the signature of one of your workers.

FUNK: It says-somebody from our cashier's office signed it. I do not know the signature.

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MR. DODD: Somebody from your bank, was it not?

FUNK: Yes, from the cashier's department. I do not know the signature.

MR. DODD: Do you want this Tribunal to believe that employees and people in your bank were sending lists out to municipal pawn brokers without it ever coming to your attention?

FUNK: I know nothing at all about these events. They can only be explained in that things were apparently delivered to the Reichsbank which it was not supposed to keep. That is obvious.

MR.DODD: Well, I would also like you to look at Document Number 3949-PS, which is dated 4 days later, 19 September 1942, Exhibit USA-848. Now, you will see this is a memorandum concerning the conversion of notes, gold, silver, and jewelry in favor of the Reich Minister of Finance, and it also says that it is "a partial statement of valuables received by our precious metals department." Again I think it is unnecessary to read it all. You can look at it and read it, but the last two paragraphs, after telling what the shipments contained as they arrived on 26 August 1942, say:

"Before we remit the total proceeds, to date 1,184,345.59 Reichsmark to the Reichshauptkasse for the account of the Reich Minister of Finance, we beg to be informed under what reference number this amount and subsequent proceeds should be transferred.

"It might further be of advantage to call the attention of the responsible office of the Reich Minister of Finance in good time to the amounts to be transferred from the Deutsche Reichsbank."

And again that is signed, "Deutsche Reichsbank, Hauptkasse," and there is a stamp on there that says, "Paid by check, Berlin, 27 October 1942, Hauptkasse."

FUNK: For this document, that is, this note to the Reich Minister of Finance, I believe I am able to give an explanation, and that is on the basis of testimony given here by witnesses who came from concentration camps. The witness Ohlendorf, if I remember correctly, and another one, have testified that the valuables which had been taken from the inmates of concentration camps had to be turned over and were delivered to the Reich Minister of Finance. Now, I assume that the technical procedure was that these things were first brought to the Reichsbank by mistake. The Reichsbank, however-and I keep repeating it-could do nothing with the pearls, jewelry, and similar items which are mentioned here, and therefore turned over these items to the Reich Minister of Finance or they were used for the account of the Reich Minister of Finance. That is

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apparent from this document. In other words, this merely is a statement of account sent by the Reichsbank for the Reich Minister of Finance. That is, I believe, the meaning of this document.

MR. DODD: Well, indeed, you did hear Ohlendorf say that these unfortunate people who were exterminated in these camps had their possessions turned over to the Reich Minister of Finance. I believe he testified to that effect here. Now, you also...

FUNK: That is what I heard here. These things were news to me. However, I did not know that the Reichsbank...

MR. DODD: You have told us that twice already.

FUNK: . . . that the Reichsbank dealt with these matters in such detail.

MR. DODD: Are you telling us that you did not know they dealt with them in such detail, or that you did not know they dealt with them at all? I think that is important. What is your answer, that you did not know they went into them in such detail or that you did not know anything about it?

. FUNK: I personally had nothing to do with it at all.

MR. DODD: Did you know about it?

FUNK: No.

MR. DODD: You never heard of it?

FUNK: I did not know at all that any jewelry, watches, cigarette cases, and so forth were delivered to the Reichsbank; that is news to me.

MR.DODD: Did you know that anything came from concentration camps to the Reichsbank? Anything at all?

FUNK: Yes, the gold, of course. I already said that.

MR. DODD: Gold teeth?

FUNK: I have said that-no.

MR. DODD: What gold from the concentration camps?

FUNK: The gold about which Herr Puhl had reported to me, and I assumed that these were coins and other gold which had to be deposited at the Reichsbank anyway, and which the Reichsbank could utilize according to the legal regulations. Otherwise, I know nothing about it.

MR.DODD: Just what did Himmler say to you and what did you say to Himmler when you had this conversation, as you tell us, about this gold from the concentration camp victims? I think the Tribunal might be interested in that conversation. What did he say, and what did you say, and where was the conversation held?

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FUNK: I do not remember any more where the conversation was held. I saw Himmler very rarely, perhaps once or twice. I assume that it was on the occasion of a visit in the field quarters of Lammers, where Himmler's field quarters were also located. It must have been there. On that occasion we spoke very, very briefly about that.

MR. DODD: Wait just a minute. Will you also tell us when it was?

FUNK: Possibly during the year 1943; it might have been 1944, I do not remember.

MR. DODD: All right.

FUNK: I attached no importance whatsoever to this matter. In the course of the conversation I put the question, "There is a gold deposit from you, from the SS, which we have at the Reichsbank. The members of the board of directors have asked me whether the Reichsbank can utilize that." And he said, "Yes." I did not say a word about jewelry or things of that kind or gold teeth or anything of that sort. The entire conversation referred only very briefly to this thing.

MR.DODD: Do you mean to tell us that an arrangement was made with your bank independently of you and Himmler, but by somebody in the SS and somebody in your bank-that you were not the original person who arranged the matter?

FUNK: That is right. It was not I.

MR. DODD: Who in your bank made that arrangement?

FUNK: Possibly it was Herr Puhl or maybe somebody else from the Reichsbank Directorate who made the arrangement with one of the gentlemen of the economic section in the SS. And I was only informed of it by Herr Puhl very briefly.

MR. DODD: Did you know Herr Pohl, P-o-h-l, of the SS?

FUNK: I imagine it was he. Herr Pohl never spoke to me about it.

MR. DODD: You do not know the man?

FUNK: I must certainly have seen him at some time, but Herr Pohl never spoke to me about these matters. I never spoke to him.

MR. DODD: Where did you see him, in the bank?

FUNK: Yes, I saw him once in the bank when he spoke to Puhl and other gentlemen of the Reichsbank Directorate during a luncheon. I walked through the room and I saw him sitting there, but I personally never spoke with Herr Pohl about these questions. This is all news to me, this entire matter.

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MR.DODD: Well, do you recall the testimony of the witness Hoess in this courtroom not so long ago? You remember the man? He sat where you are sitting now. He said that he exterminated between 21/2 and 3 million Jews and other people at Auschwitz. Now, before I ask you the next question I want you to recall that testimony and I will point something out for you about it that may help you. You recall that he said that Himmler sent for him in June 1941, and that Himmler told him that the final solution of the Jewish problem was at hand, and that he was to conduct these exterminations. Do you recall that he went back and looked over the facilities in one camp in Poland and found it was not big enough to kill the number of people involved and he had to construct gas chambers that would hold 2,000 people at a time, and so his extermination program could not have got under way until pretty late in 1941, and you observe that your assistant and credible friend Puhl says it was in 1942 that these shipments began to arrive from the SS?

FUNK: No, I know nothing about the date. I do not know when these things happened. I had nothing to do with them. It is all news to me that the Reichsbank was concerned with these things to this extent.

MR.DODD: Then I take it you want to stand on an absolute denial that at any time you had any knowledge of any kind about these transactions with the SS or their relationship to the victims of the concentration camps. After seeing this film, after hearing Puhl's affidavit, you absolutely deny any knowledge at all?

FUNK: Only as far as I have mentioned it here.

MR. DODD: I understand that; there was some deposit of gold made once, but no more than that. That is your statement. Let me ask you something, Mr. Funk . . .

FUNK: Yes; that these things happened consistently is all news to me.

MR.DODD: All right. You know you did on one occasion at least, and possibly two, break down and weep when you were being interrogated, you recall, and you did say you were a guilty many and you gave an explanation of that yesterday. You remember those tears. I am just asking you now; I am sure you do. I am just trying to establish the basis here for another question. You remember that happened?

FUNK: Yes.

MR.DODD: And you said, "I am a guilty man." You told us yesterday it was because you were upset a little bit in the general situation. I am suggesting to you that is it not a fact that this

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matter that we have been talking about since yesterday has been on your conscience all the time and that was really what is on your mind, and it has been a shadow on you ever since you have been in custody? And is it not about time that you told the whole story?

FUNK: 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.

MR. DODD: You are trying to put the blame on Puhl, are you not?

FUNK: No. He is blaming me and I repudiate that.

MR.DODD: The trouble is, there was blood on this gold, was there not, and you knew this since 1942?

FUNK: I did not understand.

MR. DODD: Well, I would like to ask you one or two questions about two short documents. It will take but a short time. You told the Tribunal yesterday that you had nothing to do with any looting of these occupied countries. Do you know what the Roges corporation was?

FUNK: Yes. I do not know in detail what they did. I know only that it was an organization which made official purchases for various Reich departments.

MR. DODD: This Roges corporation purchased on the black market in France with the surpluses from the occupation cost fund, did it not?

FUNK: I was against this type of purchases in the black market.

MR.DODD: I am not asking you whether you were for it or against it. I was simply asking you if it is not a fact that they did it.

FUNK: I do not know.

MR. DODD: All right. You had better take a look at Document Number 2263-PS, which is written by one of your associates, Dr. Landfried, whom you also asked for as a witness here and from whom you have an interrogatory. This is a letter dated 6 June 1942, addressed to the Chief of the OKW Administrative Office:

"In answer to my letter of 25 April 1942"-and so on-"100 million Reichsmark were put at my disposal from the Occupation Cost Fund by the OKW. This amount has already

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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 which 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."

It is very clear from that letter written by your associate Landfried that the Roges corporation, which was set up by your Ministry, was engaged in black market operations in France with money extorted from the French through excessive occupation costs, is it not?

FUNK: That the Roges made such purchases' is true. These things have already been dealt with here in connection with the orders and directives which the Four Year Plan gave for these purchases on the black market. However, these are purchases which 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.

MR.DODD: You told us that yesterday. That was 1943. There was not much left in France on the black market or white market or any other kind of market by that time, was there? That country was pretty well stripped by that time, as is shown in the letters.

FUNK: 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.

MR.DODD: Well, in any event I also want you to talk a little bit about Russia, because I understood you to say yesterday you

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did not have much to do with that. Schlotterer was your man who was assigned to work with Rosenberg, was he not?

FUNK: 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.

DR. DODD: That is all I want to know. He was assigned. And he participated in the program of stripping Russia of machines, materials, and goods, which went on for some considerable period of time; you knew about it.

FUNK: No, that is not true. This man did not have this task. 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.

MR. DODD: It is a different story on different occasions. I think the best way is to read your interrogation. On 19 October 1945 you were interrogated here in Nuremberg. You were asked this question:

"And part of the plan was to take machines, materials and goods out of Russia and bring them into Germany, was it not?"

And you answered:

"Yes, most certainly, but I did not participate in that. But in any case it was done."

The next question:

"Question: Yes, and you yourself participated in the discussions concerning these plans, and also your representative, Dr. Schlotterer?

"Answer: I myself did not participate.

"Question: But you gave the power to act for you in that connection to Dr. Schlotterer?

"Answer: Yes; Schlotterer represented me in economic questions in the Rosenberg Ministry."

FUNK: No, that is not true. This testimony 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.

MR. DODD: Do you mean to say that you did not make these answers that I have just read to you when you were interrogated?

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FUNK: Those answers are not correct.

MR.DODD: You know, it is very interesting that you told us yesterday that the answers to the questions put to you by Major Gans were incorrect. I posed another interrogation to you yesterday and you said that was incorrect. Now a third man has interrogated you, and you say that one is incorrect.

FUNK: No, I say what I said is wrong.

MR. DODD: Well, of course, that is what I am talking about.

FUNK: That is wrong.

MR.DODD: I will submit that interrogation in evidence; it is not in form to be submitted, but I would like to submit it a little later, with the Tribunal's permission.

THE PRESIDENT: You will inform us, when you do, as to the number and so on?

MR. DODD: Yes, I will. I have no further questions.

THE PRESIDENT: Do any of the other prosecutors wish to cross-examine?

STATE COUNSELLOR OF JUSTICE M. Y. RAGINSKY (Assistant Prosecutor for the U.S.S.R.): After Mr. Dodd's cross-examination I have a few supplementary questions to ask.

Defendant Funk, you testified yesterday that your Ministry at the time of the attack on the Soviet Union had very limited functions, and that you yourself were not a minister in the true sense of the word. In this connection I want to ask you a few questions regarding the structure of the Ministry of Economics. Tell me, are you familiar with the book by Hans Quecke, entitled, The Reich Ministry of Economics? Do you know about this book?

FUNK: No.

MR. COUNSELLOR RAGINSKY: You do not know? Are you familiar with the name of Hans Quecke?

FUNK: Hans Quecke?

MR. COUNSELLOR RAGINSKY: Yes. Hans Quecke. He was a counsellor in the Ministry of Economics.

FUNK: Quecke was a ministerial director in the Ministry of Economics.

MR. COUNSELLOR RAGINSKY: And he, of course, knew about

the structure of the Ministry of Economics and about its functions. Am I right?

FUNK: Certainly. He must have known about that.

MR. COUNSELLOR RAGINSKY: I present this book in evidence

to the Tribunal as Exhibit USSR-451, and you, Witness, will receive

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a photostat copy of the section of this book in order that you can follow me. Please open it at Page 65, last paragraph. Have you found the passage in question?

FUNK: I have not found it yet. I can only see. . .

MR. COUNSELLOR RAGINSKY: Page 65, last paragraph of the page.

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: You have found it, yes?

FUNK: The structure of the Reich Ministry of Economics?

MR. COUNSELLOR RAGINSKY: It gives the structure of the Ministry of Economics as on 1 July 1941. Your permanent deputy was a certain Dr. Landiried. Is that the same Landfried whose testimony was presented by the Defense Counsel?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: I must ask you to follow the text:

"Landfried had under him a special department which was in charge of fundamental questions of supply of raw materials for the military economy."

Defendant Funk, I am asking you.. .

FUNK: Just a moment. Where is that?

MR. COUNSELLOR RAGINSKY: It is in Section 2, Part II. Have you found it?

FUNK: No, there is nothing here about war economy. I do not see anything about war economy. Auslands-Organisation...

MR. COUNSELLOR RAGINSKY: Part II, Subparagraph 2.

FUNK: It says nothing about war economy here.

MR. COUNSELLOR RAGINSKY: I shall read the entire paragraph into the record. We shall get down to the Auslands-Organisation in good time.

FUNK: This is a special section.

MR. COUNSELLOR RAGINSKY: Yes, a special section.

FUNK: Directly subordinate to the State Secretary here is Section S. Special Section, basic questions of the supply of raw materials, basic questions of war economy, basic questions of...

MR. COUNSELLOR RAGINSKY: It is precisely about this war economy that I wish to speak. He was also in charge of the fundamental market policy and of economic questions in the border territories. The ministry consisted of five main departments. Am I right?

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FUNK: Yes.

MR. COUNSELLOR RAGINSKY: The third main department was headed by Schmeer? Am I right?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: You had a special department entitled, "Elimination of the Jews from Economic Life." That was in 1941 ? Am I right?

FUNK: Yes; that was the time we dealt with these matters; in that department the regulations for carrying out these orders were dealt with. We discussed them at length yesterday.

MR. COUNSELLOR RAGINSKY: Defendant Funk, I ask you to follow the text: "The fourth main department was headed by Ministerialdirektor Dr. Klucki, and this department was in charge of banks, currency, credit and insurance matters." Is that a fact?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: I presume that you must know the structure of your own ministry and we need not waste time in further discussions. You must know that the fifth main department was headed by State Secretary Von Jagwitz. This department was in charge of special economic problems in different countries. The fifth section of this department attended to questions of military economy connected with foreign economy. Am I right?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: The same department dealt with special foreign payments as well as with the blocked deposits . . .

FUNK: I do not understand. This is the Foreign Trade Department. They merely dealt with the technical carrying-out of the foreign exports.

MR. COUNSELLOR RAGINSKY: Take the section dealing with foreign currencies. Have you found the passage?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: You have found that it deals with blocked deposits. Were you at all connected with the collaboration existing between your ministry and the Office of Foreign Affairs of the NSDAP? Is my question clear to you?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: And your ministry had a special section dealing with these matters?

FUNK: Only this office. That can be explained in this manner. The Under State Secretary, Von Jagwitz, who was the head of this

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main department, was also active in the Auslands-Organisation. He had created a liaison office for himself in the ministry to deal with economic questions which came to the ministry-to this department, which was the Export Department, the Foreign Department-via the Auslands-Organisation. This concerned Von Jagwitz only, who at the same time was active in the Auslands-Organisation and maintained a liaison office.

MR. COUNSELLOR RAGINSKY: Then we are to understand that the Foreign Political Department had special economic functions abroad, and that it co-operated with your ministry in this sense? Is that correct?

FUNK: No, that is not correct.

MR. COUNSELLOR RAGINSKY: Then why did this department exist?

FUNK: It was not a department, but the Under State Secretary, Von Jagwitz, was at the same time active in the Auslands-Organisation. I do not know in what position. He was active in the Auslands-Organisation before he was taken into the ministry by the Reich Marshal. Then he himself created a kind of liaison office between his department and the Auslands-Organisation. That is, frequently economists from abroad belonging to the Auslands-Organisation of the NSDAP came to Berlin, and these people came to Under State Secretary Von Jagwitz and discussed their business with him and they reported to him about their experience and knowledge of foreign countries. I do not know any more about it.

MR. COUNSELLOR RAGINSKY: You wish to convince us that this was the personal initiative of Von Jagwitz, and that you as minister knew nothing at all about it?

FUNK: Certainly, I knew about it. He did it with my knowledge, with my knowledge and approval...

MR. COUNSELLOR RAGINSKY: Please follow the text and you had better listen to what I want to say. I read the last paragraph which states:

"To the Main Department V is attached the office of the Auslands-Organisation with the Reich Ministry of Economics. This office secures the co-operation between the ministry and the Auslands-Organisation of the Nazi Party."

This means that no mention is made of any private initiative of Von Jagwitz, as you tried to persuade us, but this department really was a part of your ministry. Have you found the passage?

FUNK: Yes. Herr Von Jagwitz had this liaison office and essentially it was limited to his person. It was a liaison office for collaboration with the Auslands-Organisation, which was a perfectly

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natural procedure- in many cases. I do not see why this should be unusual or criminal.

MR. COUNSELLOR RAGINSKY: We shall come back to the question at a later stage. Mr. President, I should like to pass over to another part. Would it be convenient to have a short recess now? I have a few more questions to ask.

THE PRESIDENT: Very well; the Tribunal will recess.

1A recess was taken.7

MR. COUNSELLOR RAGINSKY: You mentioned yesterday that you were the Plenipotentiary for Economy, but not a plenipotentiary in the full sense of the word. Schacht was the true plenipotentiary and you were merely a secondary one. Do you remember your article entitled "Economic and Financial Mobilization"? Do you remember what you wrote at that time?

FUNK: No.

MR. COUNSELLOR RAGINSKY: Well, we are not going to waste any time on that question. I shall remind you of it. I submit to the Tribunal in evidence Exhibit USSR-452 (Document Number USSR-452), an article by Funk, published in the monthly journal of the NSDAP and of the German Labor Front, entitled "Der Schulungsbrief," in 1939.

Turning to the defendant.] You wrote at that time:

"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."

Have you found this passage?

FUNK: Yes, I have found it.

MR. COUNSELLOR RAGINSKY: Further on you wrote:

"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."

Do. you confirm that this is precisely what you wrote in 1939?

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FUNK: Yes.

MR. COUNSELLOR RAGINSKY: Is that question not quite clear to you?

THE PRESIDENT: He said, "Yes."

FUNK: I said, "Yes"; I certainly wrote that.

MR. COUNSELLOR RAGINSKY: You confirm it. You know about the issue in June 1941 of the so-called "Green File" of Goering? It was read into the record here. These are directives for the control of economy or, rather, directives for the spoliation of the occupied territories of the U.S.S.R. How did you personally participate in the planning of these directives?

FUNK: I do not know that. I do not know any more whether or not I participated at all.

MR. COUNSELLOR RAGINSKY: You do not remember? How is it possible that these documents were planned without you, Reich Minister of Economics, the President of the Reichsbank, and Plenipotentiary for Economy and the armament industry?

FUNK: 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.

MR. COUNSELLOR RAGINSKY: Yes, we have already heard what "activities" you dealt with. Your name for spoliation is "private economic activities." Do you remember the Prague Conference of December 1941-the meeting of the economic organization -or must I remind you of it?

FUNK: No.

MR. COUNSELLOR RAGINSKY: Not necessary?

FUNK: During the interrogations my attention was called by General Alexandrov to this speech, and I told him at that time

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already that there was a wrong newspaper report about me which I had rectified later or after a short time.

MR. COUNSELLOR RAGINSKY: Just a minute, Defendant Funk. You are slightly anticipating events. You do not yet know what I am going to ask you. First listen to me and then reply. You have informed the Tribunal that you never attended any meeting of Hitler's at which the political and economic aims of the attack on the Soviet Union were discussed, that you did not know of any purpose and of any declared plans of Hitler for the territorial dismemberment of the Soviet Union, and yet you yourself declared in your statement that "the East will be the future colony of Germany," Germany's colonial territory. Did you say that the East would be the future colonial territory of Germany?

FUNK: No; I denied that in my interrogation. I immediately said, after this was presented to me, that I was speaking of the old German colonial territories. General Alexandrov can confirm that. He questioned me at that time.

MR. COUNSELLOR RAGINSKY: I have no intention of calling General Alexandrov as a witness. I am only asking you if you did say so; was it written as stated?

FUNK: No.

MR. COUNSELLOR RAGINSKY: You stated that you did not have to be reminded, but that is precisely what was mentioned in your speech, and I am going to quote verbatim from this speech:

"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."

And exactly what Europe were you discussing in December 1941 and what former German territories did you wish to mention to the Tribunal? I am asking you.

FUNK: I have not said that. I said that I did not speak about colonial territories, but of the old colonization areas of Germany.

MR. COUNSELLOR RAGINSKY: Yes, but we are not speaking here of old territories; we are speaking here of new territories which you wished to conquer.

FUNK: The area had been conquered already. We did not have to conquer that. That had been conquered by German troops.

MR. COUNSELLOR RAGINSKY: No. It was not known that they were conquered, since you were already retreating from them.

You said that you were the President of the Continental Oil Company. This company was organized for the exploitation of the

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oil fields of the Occupied Eastern Territories, especially in the districts of Grozny and Baku. Please answer me "yes" or "no."

FUNK: Not only 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.

MR. COUNSELLOR RAGINSKY: That I have already heard. But you have not answered my question.

I asked you if this company had as object the exploitation of the Grozny and Baku oil wells. Did the oil wells of the Caucasus form the basic capital of the Continental Oil Company?

FUNK: No.

MR. COUNSELLOR RAGINSKY: No? I am satisfied with your reply.

FUNK: That is not right. We had not conquered the Caucasus and therefore the Continental Oil Company could not be active in the Caucasus.

MR. COUNSELLOR RAGINSKY: All right. But Rosenberg at that time had already made a report on the conquest and exploitation of the Caucasus. Do you remember that here, before the Tribunal, a transcript of the minutes of a meeting held at Goering's office on 6 August 1942 with the Reich Commissioners of the Occupied Territories was read into the record? Do you remember that meeting?

FUNK: Yes.

MR. COUNSELLOR RAGINSKY: Did you participate in this meeting?

FUNK: That I do not know. Did they speak about the oil territories of the Caucasus in that meeting? That I do not know.

MR. COUNSELLOR RAGINSKY: No, I do not wish to say anything as yet. I shall ask you a question and you will answer. I ask you: Did you participate in that meeting?

FUNK: I cannot remember. It may very well be.

MR. COUNSELLOR RAGINSKY: You do not remember?

FUNK: No.

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MR. COUNSELLOR RAGINSKY: In that case you will be shown a document. It has already been submitted to the Tribunal, and was here read into the record. It is Exhibit Number USSR-170; it has already been presented. As stated at that meeting, the most effective measures for the economic spoliation of the Occupied Territories of the U.S.S.R., Poland, Czechoslovakia, Yugoslavia, and other countries were discussed. At this meeting Defendant Goering addressed himself to you. Do you remember whether you were present at that meeting or not?

FUNK: Yes, indeed. I remember that. 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.

MR. COUNSELLOR RAGINSKY: I did not ask you about that, Defendant Funk. Were you present at that meeting or not? Could you answer that question?

FUNK: Of course. Since Goering talked to me, I must have been there. It was on 7 August 1942.

MR. COUNSELLOR RAGINSKY: Defendant Funk, you have replied here to certain questions asked by Mr. Dodd regarding the increase of the gold reserve of the Reichsbank; I should like to ask you the following question: You have stated that the gold reserves of the Reichsbank were increased only by the gold reserves of the Belgian Bank; but did you not know that 23,000 kilograms of gold were stolen from the National Bank of Czechoslovakia and transferred to the Reichsbank?

FUNK: I did not know that it had been stolen.

MR. COUNSELLOR RAGINSKY: Then what do you know?

FUNK: I stated explicitly here yesterday that the gold deposits had been increased mostly by the taking over of the gold of the Czech National Bank and the Belgian Bank. I spoke especially of the Czech National Bank yesterday.

MR. COUNSELLOR RAGINSKY: Yes, but I am not asking you about the Belgian Bank, but about the Bank of Czechoslovakia.

FUNK: Yes, I mentioned it yesterday. I said so yesterday...

THE PRESIDENT: He said that just now. He said that he had spoken about the Czechoslovakian gold deposits.

MR. COUNSELLOR RAGINSKY: Mr. President, he did not mention Czechoslovakia yesterday and I am asking him this question

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today. But if he replies to this question in the affirmative, I shall not interrogate him any further on the matter, since he will have confirmed it.

[Turning to the defendant.] I now pass on to the next question, to the question of Yugoslavia. On 14 April 1941, that is, prior to the complete occupation of Yugoslavia, the Commander-in-Chief of the German Army issued a directive for the occupied Yugoslav territories. This is Exhibit USSR-140; it has already been submitted to the Tribunal. Subparagraph 9 of this directive determines the compulsory rate of Yugoslav exchange-20 Yugoslav diners to the German mark. And the same compulsory rate of exchange, which had been applied to the Yugoslav diner, was also applied to the Reich credit notes issued by the Reich Foreign Currency Institute.

These currency operations permitted the German invaders to export from Yugoslavia at a very cheap rate various merchandise as well as other valuables. Similar operations were carried out in all the Occupied Eastern Territories, and I ask you: Do you admit that such operations were one of the means for the economic spoliation of the Occupied Eastern Territories?

FUNK: No.

MR. COUNSELLOR RAGINSKY: Very well.

FUNK: That depends on the relation of the exchange rate. In some cases, in particular in the case of France, I protested against the underevaluation...

MR. COUNSELLOR RAGINSKY: Excuse me just one minute, Defendant Funk. You have already spoken about France and I do not want to take up the time of the Tribunal unnecessarily. I think you ought to answer my question.

FUNK: At the moment I do not know what the exchange rate between the diner and the mark was at that time. In general, insofar as I had anything to do with it-I did not make the directive; that came from the Minister of Finance and from the Armed

· Forces-insofar as I had anything to do with it I always urged that the rate should not differ too greatly from the rate which existed and which was based on the purchasing power. At the moment I cannot say what the exchange rate for diners was at that time. Of course, Reich credit notes had to be introduced with the troops because otherwise we would have had to issue special requisition vouchers, and that would have been much worse than introducing an official means of payment, as is now being done here in Germany by the Allies, because working with requisition vouchers is much more disadvantageous and harmful for the population and the entire country than working with a recognized means of payment. We invented the Reich credit notes ourselves.

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MR. COUNSELLOR RAGINSKY: In other words, you wish to state that you had nothing to do with it and that the entire matter rested with the Ministry of Finance. Then tell me please, are you aware of the testimony given by your assistant, Landfried, whose affidavit was submitted by your defense counsel? You will remember that Landfried stated and affirmed something totally different. He said that in the determination of exchange rates in the occupied territories yours was the final and determining voice. Do you not agree with this statement?

FUNK: When these rates were determined, I, as President of the Reichsbank, was of course consulted and, as can be confirmed by every document, I always advocated that the new rates should be as close as possible to the old rates established on the basis of the purchasing power, that is to say, no underevaluation.

MR. COUNSELLOR RAGINSKY: Consequently, the compulsory rate of exchange in the occupied countries was introduced with your knowledge and according to your instructions?

FUNK: Not on the basis of my directives. I was only asked for advice.

MR. COUNSELLOR RAGINSKY: Your advice?

FUNK: I had to give my approval. That is, the Reichsbank Directorate formally gave the approval, but...

MR. COUNSELLOR RAGINSKY: I am satisfied with your reply. I now go on to the next question. On 29 May 1941 the Commander-in-Chief in Serbia issued an order regarding the Serbian National Bank, which order has already been submitted as Exhibit USSR-135. This order liquidated the National Bank of Yugoslavia and divided the entire property of the bank between Germany and her satellites. Instead of the National Bank of Yugoslavia a fictitious so-called Serbian Bank was created, whose directors were appointed by the German Plenipotentiary for National Economy in Serbia. Tell me, do you know who was the Plenipotentiary for National Economy in Serbia?

FUNK: It was probably the Consul General Franz Neuhausen, the representative of the Four Year Plan.

MR. COUNSELLOR RAGINSKY: Yes. It was Franz Neuhausen. Was he a collaborator in the Ministry of Economics?

FUNK: No.

MR. COUNSELLOR RAGINSKY: He never worked in the Ministry of Economics?

FUNK: No.

MR. COUNSELLOR RAGINSKY: He never worked there?

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FUNK: Neuhausen? No, he never worked in the Ministry of Economics.

MR. COUNSELLOR RAGINSKY: Was he a collaborator of Goering's?

FUNK: Yes, that is correct.

MR. COUNSELLOR RAGINSKY: Well, he was a collaborator of Goering's. Do you admit that such specific currency operations, as a result of which the Yugoslavian Government and its citizens were robbed of several million diners, could not have been carried out without your participation and without the co-operation of the departments within your jurisdiction?

FUNK: I do not know in detail the directives according to which the liquidation was carried out and by which the new Serbian National Bank was founded, but it goes without saying that the Reichsbank participated in such a transaction.

MR. COUNSELLOR RAGINSKY: I want to ask you two more questions. Together with the unconcealed spoliation, consisting in the confiscations and requisitions which the German invaders carried out in the Occupied Territories of Eastern Europe, they also exploited these countries to the limit of their economic resources by applying various exchange and economic measures, such as depreciation of currency, seizure of the banks, artificial decrease of prices and wages, thus continuing the economic spoliation of the occupied territories. Do you admit that this was precisely the policy of Germany in the Occupied Territories of Eastern Europe?

FUNK: No.

MR. COUNSELLOR RAGINSKY: You do not admit this?

FUNK: In no way whatsoever.

MR. COUNSELLOR RAGINSKY: I now submit to the Tribunal Document USSR-453. This is a new document, consisting of notes on a conference held by the Reich Commissioner for the determination of prices on 22 April 1943. Price experts from all the occupied territories attended this conference. I shall now read into the record some excerpts from this document. It says on Page 2:

"The 5.5 million foreign workers are composed of: 1.5 million

prisoners of war, 4 million civilian workers."

The document further says:

"1,200,000 from the East, 1,000,000 from the former Polish

territories. . . 200,000 citizens of the Protectorate. . . 65,000

Croatians, 50,000 remainder of Yugoslavia (Serbia)"-and

so on.

Further this document also says in connection with the equalization of prices:

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"Price equalization should be operated to the debit of the producer countries, that is, through the Central Clearing Office, which for the most part is to the advantage of the occupied countries."

On Page 14 it is stated:

"These price deliberations were of no importance for the occupied territories, since the main interest did not lie in the welfare of the population but in the utilization of all the economic forces of the country."

On Page 16 we find the following excerpt:

"Concerning the Occupied Eastern Territories, Ministerial Counselor Roemer has stated that prices there are far below German prices, and so far the Reich has already reaped large import profits."

Mention is made, on Page 19, of Germany's clearing debt, which amounted to 9,300,000 marks. At the same time the clearing balance

for Czechoslovakia showed a deficit of 2,000,000; for the Ukraine of 82,500,000; for Serbia of 219,000,000; for Croatia of 85,000,000; and for Slovakia of 301,000,000 marks.

And finally, on Page 22 of the document, it says:

"The prices in the Occupied Eastern Territories are kept at the lowest possible level. We have already realized import profits which are being used to cover Reich debts. Wages are generally only one-fifth of what they are in Germany."

You must admit that the planned robbery perpetrated by the German invaders on so gigantic a scale could never have been carried out without your active participation as Minister of Economics, President of the Reichsbank, and Plenipotentiary for Economy?

FUNK: I must again stress that during the war I was no longer Plenipotentiary for Economy. But may I state my position to this document? First, there is the figure of the number of the workers which were brought from the occupied territories and other foreign countries into Germany. I have emphasized, myself, and it has been confirmed by other statements, that I was basically against bringing in foreign manpower from occupied territories to such an extent as to impair the economic order in those territories. I am not even speaking about recruitment of forced labor. I also opposed that. When an expert whom I do not know says that the deliberations about price policy were of no importance for the occupied territories, because the main interest did not lie with the welfare of the population but in the exploitation of economic forces, I must contradict that point of view. In any case, it is not my point of view. I do not know who the man was who said that, but it is a matter of

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course that a territory cannot produce well unless the economy is kept on a good footing and prices are fixed at a level which enables the people to exist and to maintain social order. So I have to oppose this point of view also. As far as the clearing debt is concerned, I explained yesterday in detail that the clearing system was in common usage for Germany, and that I have always recognized and confirmed that these clearing debts were genuine debts which, after the war, had to be repaid in the currency in which they were incurred, based on the purchasing power at that time. I do not see any spoliation here.

Moreover, I must again stress the fact that I was not competent for the economy in the occupied territories, that I had no power to give a directive there and that I participated only insofar as I detailed officials to individual offices, just as all other departments did, and that, of course, there was co-operation between these offices and the department at home. But I cannot assume responsibility for the economy in the occupied territories. The Reich Marshal definitely admitted that as far as economic questions are concerned, it was his responsibility.

MR. COUNSELLOR RAGINSKY: I understand. You collaborated, and now you do not wish to bear the responsibility. You say that the expert has made the statement. But do you remember your testimony which you gave on 22 October 1945?

FUNK: I do not know what interrogation. . .

MR. COUNSELLOR RAGINSKY: When you were asked about the compulsory mobilization of foreign workers you were also asked if you knew about it and if you had ever protested against it. Is that correct? You replied, "No, why should I be the one to protest against it?"

FUNK: That is not correct. I protested against the compulsory recruitment of workers and against so many workers having been taken out of occupied territory that the local economy could no longer produce. That is not correct.

MR. COUNSELLOR RAGINSKY: I have one last question to ask you. Do you remember an article published in the newspaper Das Reich, dated 18 August 1940, in connection with your 50th birthday? This article is entitled, "Walter Funk, Pioneer of National Socialist Economic Thought." I shall read into the record a few excerpts from this article:

"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.

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"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."

And in the last paragraph of this article:

'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."

The whole world knows what the ideals of the Fuehrer were.

Do you admit that this article gives a correct appreciation of your personality and your activities?

FUNK: Generally, yes.

MR. COUNSELLOR RAGINSKY: I have no more questions to ask.

[Dr. Din approached the lectern.]

THE PRESIDENT: What is it you wish to say, Dr. Dix?

DR.DIX: I have only one question for the witness, which was brought up by the cross-examination of Mr. Dodd. I could not put this question any sooner, since I am asking it only because of what Mr. Dodd said.

THE PRESIDENT: Yes, go on.

DR.DIX: Witness, Mr. Dodd has put to you a record of your interrogation, according to which Schacht, after leaving the Reichsbank, still had a room there. You have heard the testimony of Schacht here. He testified clearly that he did not have a room at the Reichsbank but that the Reich Government put a room in his apartment at his disposal and contributed to the rent, and that the Reich Government paid a secretary whom he took with him from the Reichsbank, but who was now paid by the Reich Government and not by the Reichsbank. That was the testimony of Schacht. By your answer given to Mr. Dodd it was not quite clear whether you have any doubt about the correctness of that statement by Schacht. I ask for your opinion.

FUNK: I do not know anything about the apartment of Dr. Schacht. I was told at the time that he still came frequently to the Reichsbank and that a room was reserved for him. If that information was not correct, then it is not my fault. I do not doubt that what Dr. Schacht said is correct. He must know the arrangements concerning his apartment better than I do.

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THE PRESIDENT: Dr. Sauter, do you wish to re-examine?

DR. SAUTER: Mr. President, we have found this final questioning of the Defendant Dr. Funk harder to follow than the other cases, because the translation caused serious difficulties. I have to admit, frankly, that I have been able to understand only part of what has been said here. The defendant may probably have had the same difficulty and therefore I should like to reserve the right, Mr. President, after I receive the stenographic record, to make one or two corrections, if the transcript should show this to be necessary-. It has also been made more difficult for us, Mr. President, because in the course of cross-examination a large number of extensive documents was submitted to the Defendant Dr. Funk. We are gradually becoming used to those surprises. Moreover, the Defendant Funk was supposed to give answers to questions concerning documents which he had not issued, which had nothing to do with his activities, which he...

THE PRESIDENT: Dr. Sauter, the Tribunal saw no sign at all of the Defendant Funk not being able to understand thoroughly every question put to him. And I think that therefore there is no reason for any protest on your behalf and you should go on to put any question you wish to put in re-examination-let us bay, questions which arise out of the cross-examination.

DR. SAUTER: Mr. President, on our earphones, at least on this side, we could not understand quite a number of questions. Whether it applied to these particular earphones or to the entire apparatus I do not know.

THE PRESIDENT: Well, if the Defendant Funk did not understand any questions put to him, he could have said so. He did not say so. He answered all the questions, from a logical point of view, perfectly accurately. You can ask him if you like, if he did not understand any of the questions put to him.

DR. SAUTER: Now, Herr Funk, the Prosecution among other things has put to you that you participated in the exploitation, the spoliation of France. In this connection is it correct that the merchandise, the consumer goods which came from France, were in many cases manufactured from raw materials which had come from Germany?

FUNK: Certainly. 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.

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DR. SAUTER: Dr. Funk, excerpts from an article which appeared on the occasion of your birthday have been read before. Do you know the author of that article?

FUNK: Yes, from the earlier years.

DR. SAUTER: Did he receive any factual material from you for that article?

FUNK: No.

DR. SAUTER: Did he not ask for it?

FUNK: No, I did not know anything about that article beforehand. I did not order a birthday article for myself.

DR.SAUTER: Precisely. So you did not know anything about that article and therefore, if I understand you correctly, there is no guarantee that what is said in this article is completely true.

FUNK: No. But I find that the tendency of the article is generally very good. The tendency . . .

DR. SAUTER: Witness, the American prosecutor confronted you yesterday with the matter of your negotiations with Rosenberg in the spring of 1941 and the fact that at that time, a few months before the march into Russia, you had these negotiations with Rosenberg. He apparently wanted to conclude that you had admitted, or wanted to admit, that you had known about the intention of Hitler to wage an aggressive war against Russia. You did not have a chance to say anything on this yesterday. Therefore I should like to give you another opportunity now to state very clearly what your belief was at that time concerning the intentions of Hitler in the spring of 1941, when you negotiated with Rosenberg, and what you knew about any possible causes for war before that time.

FUNK: 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

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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.

DR. SAUTER: Witness, the Soviet Russian prosecutor has pointed out again and again that you were not only Reichsbank President and Reichsminister of Economics, but also Plenipotentiary for Economy. You have corrected that already and pointed out that from the very beginning when you were appointed, your authority as Plenipotentiary for Economy was practically taken over by Goering, and that, I believe, in December of 1939, your authority as Plenipotentiary for Economy was also formally turned over to Goering.

MR. DODD: I wish to enter an objection not only to the form this examination is taking, but as to its substance. Counsel is in effect testifying himself, and he is testifying about matters that the witness testified to on direct examination, and it seems clear to us that this cannot be helpful at all to the Tribunal as a matter of re-direct examination.

THE PRESIDENT: Dr. Sauter, is it really proper for you to get the witness to go over again the evidence which he has already given? The only object of re-examination is to elucidate any questions which have not been properly answered in cross-examination. The witness has already dealt with the topics with which you are now dealing, in the same sense which you are now putting into it.

DR. SAUTER: I have repeated the statements only because I want to put a question to the witness now concerning a document which was submitted only yesterday, which had not been submitted until then, and to which I could therefore not take any position; and because the Soviet Russian prosecutor has again made the assertion here that the defendant also during the war was Plenipotentiary for Economy, although that is not correct. Mr. President. . .

THE PRESIDENT: I have heard myself the witness say over and over again that he was not the Plenipotentiary General for Economy during the war. He has repeatedly said that.

DR. SAUTER: But it has been repeated from this side. Mr. President, yesterday a document was submitted which bears the Document Number EC-488.

THE PRESIDENT: What is the document you want to deal with?

DR. SAUTER: Number EC-488. It was presented yesterday, and is a letter dated 28 January 1939. On the front page it is marked in

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large letters "Secret." Here in the original is the heading, which is in capital letters, and it reads, "The Plenipotentiary for War Economy." So much for the heading of the letter paper. Then the word "War" is crossed out, so that you can read only, "The Plenipotentiary for Economy."

Therefore, before 28 January 1939 the title of Plenipotentiary for War Economy must have been changed to a new title, "Plenipotentiary for Economy." I now ask that the defendant...

THE PRESIDENT: Yes, I see. The copy that we have before us has not got the word "War" in it at all.

DR. SAUTER: It can be seen on the photostat.

THE PRESIDENT: I see it. But what is the question you want to put?

DR. SAUTER: At the time when this letter was written, the Plenipotentiary was the Defendant Funk. I should like to ask to be permitted to put the question to him, how it can be explained that the title of his office-that is, Plenipotentiary for War Economy-was changed. The question would be how it could be explained that the title of his office, "Plenipotentiary for War

· Economy" had been changed to the new title, "Plenipotentiary for Economy."

FUNK: The reason is...

DR. SAUTER: One moment, Dr. Funk, please.

THE PRESIDENT: I did not ask you to stop putting your question. You can put your question. Go on. What is the question?

DR. SAUTER: Go on, Dr. Funk.

FUNK: The reason was that according to the old Reich Defense Law, Schacht had been appointed Plenipotentiary for War Economy, and on the basis of this second Reich Defense Law, which appointed me, I was appointed Plenipotentiary for Economy, because at that time it was quite clear that the special tasks concerning war economy-that is to say, armament industry, war economy proper- could no longer remain with the Plenipotentiary for Economy, but that he had essentially to co-ordinate the civilian economic departments.

DR. SAUTER: In connection with that, Mr. President, may I call your attention to another document which was submitted yesterday. That is Number 3562-PS. Here the heading already has the correct new title, "Plenipotentiary for Economy." That is no more "Plenipotentiary for War Economy," and that is also a new document which was submitted only yesterday. Mr. President...

MR. DODD: Just to keep the record straight, Mr. President, that Document 3562-PS is in evidence, and it was submitted by

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Lieutenant Meltzer at the time he presented the case against the individual Defendant Funk.

THE PRESIDENT: Mr. Dodd, am I not right in thinking that the Defendant Funk stated from the outset in his examination in chief that he was appointed Plenipotentiary General for Economy?

MR. DODD: Yes, indeed, Sir. That is as I thoroughly understand it.

THE PRESIDENT: And you have not challenged that?

MR. DODD: We have not challenged the fact that he said so. But we do challenge the fact that he, in fact, was only for economy. We do maintain that he, in fact, had much to do with the war effort as the Plenipotentiary.

THE PRESIDENT: Yes. But he was not to be named that?

MR. DODD: No. And that Document EC-488 was not offered, anyway, for that purpose, but rather to show that the defendant was engaged in talking about what prisoners of war would do after an attack.

DR. SAUTER: Yesterday a document was produced about the interrogation of a certain Hans Posse. It is Document 3894-PS. The witness Hans Posse was formerly State Secretary in the Ministry of Economics and as such Deputy Plenipotentiary for Economy. That record has been submitted by the Prosecution in order to show that allegedly there was a struggle for power, as it says here, between Funk and Goering.

However, I should like to quote to the witness a few other points from that record so that several other points can also be used as evidence:

Witness, State Secretary Hans Posse says, for instance-and I should like to ask whether this is still your opinion today-that is Document 3894-PS, Page 2 of the German translation, at the bottom of the page-he was asked, "How often did you report to Funk in connection with your duties as Deputy to the Plenipotentiary?"

The witness answered then, "The Plenipotentiary for Economy never really went into action."

FUNK: I must repeat what I said again and again, and what has keen confirmed by everybody who has been heard on that question. That was a post which was merely on paper.

DR. SAUTER: Then the witness was asked to what final end you, Dr. Funk, had worked.

It says, "Dr. Posse, is it correct that the office of Plenipotentiary for Economy was established to the final end of uniting all economic functions with a view to the preparation for war?"

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Then the witness answered, "The purpose was what I have just said-to co-ordinate the various conflicting economic interests. But there was no talk about the preparation for war."

And on the same page, on Page 4, at the bottom, the witness says, I quote:

"It is correct that the aim, was to co-ordinate all economic questions, but the purpose was not to prepare for war. Of course, if war preparation should become necessary, it was the task of the Plenipotentiary for Economy to concern himself with these questions and to act as a co-ordinator."

FUNK: Herr Posse was an old, sick man, whom I had put in this post. He was formerly State Secretary under Schacht, and when I took over the ministry, I received a new State Secretary through Goering who, unfortunately, later became insane. And then State Secretary Dr. Landfried came to me, and Posse, who formally was still in the Ministry of Economics as State Secretary, was without a job. Therefore I made him an executive officer attached to the Plenipotentiary for Economy.

Here, of course, he had constant difficulties from the very beginning. The High Command of the Armed Forces or the War Economy Staff wanted to reduce the authority of the Plenipotentiary, as can be seen from the letter which was presented yesterday. And the civilian economy department did not want to follow his directives because they already had been subordinated to and had to follow the directives of the Delegate for the Four Year Plan. Therefore, as a matter of fact, that unhappy Plenipotentiary for Economy held a post which to all intents and purposes existed only on paper.

THE PRESIDENT: Would this not be a convenient time to break off now?

[The Tribunal recessed until 1400 hours.]

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Afternoon Session

DR.SAUTER: Mr. President, I have two more questions which I wish to put to the Defendant Dr. Funk.

[Turning to the defendant.] Dr. Funk, before the recess we stopped at Document 3894-PS, the testimony of your State Secretary Posse. I should like to read one passage on Page 7 of the German text and ask you whether you agree with it. The witness Posse was asked by the Prosecution whether he, as Deputy Plenipotentiary for Economy, knew about the international relations, especially about the war situation and so forth, and he says, on Page 7, in the middle:

"We never knew anything about the international situation

and we never heard anything about it, and if the inter-

national situation was mentioned in our discussions we could

always voice merely our personal opinions."

And a few lines further down:

"We"-he means apparently himself and you, Dr. Funk-"We

always hoped that there would be no war."

Do you agree with this opinion of your former State Secretary Posse?

FUNK: Yes. I have said repeatedly that until the end I did not believe that there would be a war, and the same is true of my colleagues, and everyone who spoke to me at that time will corroborate this. Herr Posse was, of course, still less informed about political and military events than I was. Consequently, that also applies to him.

DR. SAUTER: Then I have a final question to put, Witness. You have seen the film which the Prosecution has presented. Now, you were the President of the Reichsbank. Consequently you are familiar, possibly only superficially with the conditions in the vaults of the Reichsbank, at least, I assume, in Berlin, if not in Frankfurt, where the film was taken; and you also know how, especially during the war, these items which had been deposited with the bank in trunks or packages and the like were safeguarded. Possibly, Dr. Funk, on the basis of your own knowledge of the conditions you can make a statement regarding this short film which we have seen.

FUNK: 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

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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.

DR. SAUTER: Mr. President, I have finished my interrogation of the Defendant Funk, and I should now like to ask permission to examine the only witness whom I can call at this time, the witness Dr. Hayler.

THE PRESIDENT: Very well.

MR.DODD: [Interposing.] Mr. President, may I raise one matter before the witness is excused? This Document 3894-PS, that we have quoted from and that the defendant has quoted from,

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contains a number of other quotations and I think it would be well if we submitted the whole document in the four languages; and I shall be prepared to do that so the Tribunal will have the benefit of the whole text. So far we have both been quoting from it, but I think it would be most helpful to the Court if it had the whole text.

And may we ask, Mr. President, shall we make arrangements or should I do anything about getting the witness Puhl here?

THE PRESIDENT: Dr. Sauter, have you any request to make with reference to the witness Publ, who made an affidavit?

DR. SAUTER: Regarding the witness Emil Puhl I beg to request, Mr. President, that he be brought here for cross-examination. I was going to make that request in any case.

THE PRESIDENT: Yes, certainly, Dr. Sauter, the witness Puhl should be brought here. He will be brought here as soon as possible.

DR. SAUTER: Thank you.

THE PRESIDENT: Now the defendant can return to the dock.

[The witness Dr. Hayler took the stand.]

THE PRESIDENT: Will you state your full name?

HAYLER (witness): Franz Hayler.

THE PRESIDENT: Will you repeat this oath after me: I swear by God-the Almighty and Omniscient-that I will speak the pure truth-and will withhold and add nothing.

[The witness repeated the oath.]

THE PRESIDENT: You may sit down.

DR. SAUTER: Dr. Hayler, how old are you?

HAYLER: 46 years.

DR. SAUTER: Are you a professional civil servant, or how did you get into the Ministry of Economics under Dr. Funk?

HAYLER: I was an independent business man and merchant and as such first became the head of the "Economic Group Retail Trade" within the organization of industrial economy. Id this capacity I had very close contact with the Ministry of Economics. After Minister Funk had been appointed Minister for Economics I reported to him regarding the scope of my work, and on that occasion I made his acquaintance. When I was then put in charge of the "Reich Group Trade," the working relations between the organization directed by me and the Ministry, especially between the then State Secretary Landfried and the Minister himself, became very friendly.

After the separation of the ministries in the autumn of 1943, the main task of the Ministry of Economics was to provide for the

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German people, that is, the civilian population. As head of the trade organization I was the person responsible for the sale of merchandise, that is, for the procurement of supplies, and during a conference with Minister Funk regarding the co-operation between trade' and the Ministry, Herr Landfried, who was then State Secretary, made the suggestion that Minister Funk call me into his Ministry and make me his deputy. Herr Landfried believed that under the existing conditions he himself was not strong enough to carry out this difficult task since the Ministry had been deprived of its influence on production. Then, when Minister Funk told him in reply to his suggestion that he, Landiried, was the deputy of the Minister, Landiried replied that he could not continue to carry out these tasks and that he asked to be permitted to retire and proposed that I be his successor. About two or three weeks later I was put in charge of the affairs of the State Secretary.

DR. SAUTER: When was this conference?

HAYLER: This conference took place in October 1943; my appointment came on 20 November 1943.

DR. SAUTER: So that until the autumn of 1943, Dr. Hayler, you were employed in your organizations only in an honorary capacity?

HAYLER: Yes.

DR. SAUTER: That was, I think, retail trade?

HAYLER: Yes, trade.

DR. SAUTER: And as from 1943 you became official in the Reich Ministry of Economics in the capacity of State Secretary?

HAYLER: I became an official with this position of State Secretary on 30 January 1944.

DR. SAUTER: In this position you were one of the closest collaborators of Dr. Funk?

HAYLER: I was his deputy.

DR. SAUTER: Dr. Hayler, during a conference that we had on the day before yesterday, I discussed with you the question of whether the Defendant Dr. Funk was a particularly radical man or whether, on the contrary, he acted with moderation and consideration toward others. What do you have to say to this question which may have certain importance in forming an opinion on the personality of the Defendant Funk?

HAYLER: Funk is above all very human, and always has been. Radicalism is quite foreign to his entire character and being. He is more of an artist, a man of very fine artistic feeling and scholarly ideas. I believe one can say that at no time was he a doctrinaire or dogmatic. On the contrary, he was conciliatory and anxious to

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settle disputes. For this reason, in Party circles in particular, he was considered too soft, too indulgent, in fact he was accused many times of being too weak. He tried to protect domestic economy from political encroachment and from unnecessary severity; and because of his respect and his regard for enterprising endeavor and out of his own responsibility to economy and to the people, he fought against unnecessary intervention in various enterprises even during the war. He protected industry against mergers end closures. This finally led to his being deprived of the responsibility for production in the decisive phase of the war.

I recall from the time of my collaboration with him, when I was still in charge of the trade organization, that Funk on various occasions interceded for men in the industrial world who were in political difficulties. I believe, however, that because of these individual cases, such as his intervention on behalf of Consul General Hollaender or of Herr Pietsch, and because of his attempts to promote peace, he at that time had to expect grave consequences; also because of his intervention in the case of Richard Strauss, as is surely known, and in similar cases. I do not think these individual cases are of such importance as perhaps the following: After the catastrophe of 9 November 1938 the process of Aryanization was to be intensified in the Ministry of Economics; and at that time a few political men were forced upon the Ministry, especially Herr Schmeer. I remember distinctly that at that time Landfried in particular, as well as Funk, slowed down considerably this radicalization of the Ministry; and Funk and the Ministry were blamed for doing so.

After 8 and 9 November I once had a conference regarding the events of that date with Himmler, in which I voiced my complaints. Himmler on that occasion finally reproached both Funk and myself by saying, among other things:

"Finally, you people on the economic side and connected with the economic management are also to blame that things have gone too far. People like Herr Schacht cannot be expected to do anything except go slow ail the time and oppose the will of the Party; but if you and Funk and all you people on the economic side had not slowed things down so much, these excesses would not have happened."

DR. SAUTER: Yes, Dr. Hayler; another question. You also worked with Dr. Funk in matters concerning the economy of the occupied territories. Dr. Funk is accused of having played a criminal part in despoiling the occupied territories as well as in destroying their currency and economic systems. Could you enlighten the Court as briefly as possible on the Defendant Funk's attitude and activities? As briefly as possible.

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EAYLER: I believe two facts must be stated first of all: First, the influence of the Ministry of Economy on the occupied territories was relatively limited. Secondly, during the year in which I was in the Ministry these questions were no longer particularly important.

Generally speaking, the position was as follows: Funk was constantly accused of thinking more of peace than of war. The opinions he proclaimed both in his speeches and in print referred to a European economic policy; and I assume that these talks and publications or articles are before the Court.

DR. SAUTER: Yes, they are here.

EAYLER: Funk looked at the occupied territories from exactly the same point of view. He raised repeated objections to the overexploitation of the occupied territories and expressed the view that war-time co-operation should form the basis of later co-operation in peace. His view was that confidence and willingness to co-operate should be fostered in the occupied territories during the war. He expressed the view that the black market cannot be combated by the black market and that, since we were responsible for the occupied territories, we must avoid anything likely to disturb the currency and economic system of these territories.

I think I remember that he also discussed the question with the Reich Marshal and defended his own point of view. He also repeatedly opposed unduly heavy occupation expenses, and always favored the reduction of our own expenditure, that is, of German expenditure in the occupied territories. In other words, he regarded the occupied territories in exactly the same way as other European countries; and this attitude is best illustrated by the speech he made in Vienna, I believe, in which he publicly acknowledged as genuine debts the clearing debts, the high totals of which were due mainly to differences in price, that is, inflationist tendencies, in the countries which delivered the goods.

DR. SAUTER: Dr. Eayler, the Defendant Funk is furthermore accused of playing a criminal part in the enslavement of foreign workers. This accusation applies particularly to the period during which you were a co-worker of Dr. Funk. Can you tell us briefly how Funk thought and acted in regard to this point?

EAYLER: There can be no question of Funk's co-operation in questions regarding the employment of foreign labor at this time, but only within the scope of his responsibility in the Central Planning Board. But it remains to be seen whether the Central Planning Board was at all responsible for the employment of workers or whether the Central Planning Board did nothing more than ascertain the manpower needs of the various production spheres.

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However, regardless of what the tasks of the Central Planning Board may have been, Funk's position in the Central Planning Board was the following:

Funk, as Minister of Economy, was responsible for the supplies for the civilian population and for export. In the period following the separation of the ministries, no additional foreign worker I believe was employed in the production of supplies for civilians or for export. On the contrary, Funk was constantly confronted with the fact that during that time German and foreign workers were continually being removed from the production of consumer goods and put into armament production. Consequently, I cannot imagine that an accusation of this sort can be made against Funk with reference to this period of time.

On this occasion I should like to emphasize another point which seems important to me. Provisioning the foreign workers was a very serious question. I believe that even Herr Sauckel will corroborate the fact that, when this question came up, Funk was at once ready-even though there- was already a great scarcity of provisions for the German people due to many air raids and destructions to release large quantities of supplies and put them at the disposal of the foreign workers.

DR. SAUTER: If I understand you correctly, he tried to see to it that the foreign workers who had to work in Germany were supplied as well as was possible with consumer articles: food, shoes, clothes, and so on.

HAYLER: Particularly shoes and clothing; Funk was not the competent authority for food.

DR. SAUTER: Shoes and clothing?

HAYLER: Yes, I have specific knowledge of thin And as a result Funk had considerable difficulty; for the Gauleiter, in view of the great scarcity of goods, did their best to secure supplies for the inhabitants of their own Gaue for whom they were responsible, and in so doing used every means which came to hand. Funk constantly had to oppose the arbitrary acts of the Gauleiter, who broke into the supply stores in their Gaue and appropriated stocks intended for the general use.

DR. SAUTER: Dr. Eayler, do you know whether Dr. Funk-I am still referring to the time when you worked with him-represented the viewpoint that the foreign worker should not be brought to Germany to work here but that rather the work itself should be taken from Germany into the foreign countries so that the foreign worker could perform his work in his home country and remain at home? Please answer that.

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HAULER: I know very well that Funk represented that viewpoint and it is in accordance with his general attitude, for the political disquiet and dissatisfaction which accompany the displacement of such large masses of human beings temporarily uprooted was in opposition to the policy of appeasement and reconstruction which was definitely Funk's goal.

DR. SAUTER: I now come to the last question which I wish to put to you, Dr. Eayler. When the German armies retreated and when German territories were occupied by enemy armies, difficulties arose regarding the supplying of these territories with money. At that time Eitler is supposed to have planned a law according to which the acceptance and passing on of foreign occupation money was to be punished even by death. I am not interested now, Dr. Eayler, in finding out why Eitler planned to do this; but I am interested in finding out, if you can tell me, how the Defendant Funk reacted to this demand by Eitler and what success he had.

EAYLER: Two facts can be established in regard to this point, which should be of interest to the Tribunal. I have rarely seen Funk as depressed as at that time, after he had received information about the so-called "scorched earth decree." I believe he was the first minister to issue at that time two very clear decrees, one from the Ministry of Economics, in which he gave definite instructions that wherever German people were an administration of economy in some sort of form must remain; where it is necessary that people be provided for, the State must continue to provide for these people.

The second decree was issued at the same time by the President of the Reichsbank, in which he decreed that the money market had to be cared for by the remaining offices of the Reichsbank in the same way that economy was to be cared for.

Regarding your question itself, I recall very distinctly that the Fuehrer himself, it was said, had demanded of the Ministry of Economics the issuing of a legal regulation according to which the acceptance of occupation money was forbidden to every German on pain of death. Herr Funk opposed this demand very energetically, I believe with the help of Herr Lammers. He himself telephoned headquarters repeatedly and finally succeeded in having the Fuehrer's directive withdrawn.

DR. SAUTER: Have you finished, Dr. Hayler?

HAYLER: Yes.

DR. SAUTER: Mr. President, I have no further questions to put to the witness.

THE PRESIDENT: Do the other Defendants' Counsel wish to ask any questions?

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[No response.]

Does the Prosecution wish to cross-examine?

MR. DODD: When did you join the Nazi Party, Mr. Witness?

HAYLER: Did I understand you correctly-when did I become a member of the NSDAP?

MR. DODD: That is right.

HAYLER: December 1931.

MR. DODD: Did you hold any offices in the Party at any time?

HAYLER: No; I never held office in the Party.

MR.DODD: You were the head of a trade group in 1938, the Reichsgruppe "Handel"?

HAYLER: I was the head of the Economic Group "Retail Trade" from 1934 on, and from 1938 on, head of the Reich Group "Trade." This organization was a part of the organization of industrial economy and was under the Reich Ministry of Economics.

MR. DODD: Membership in the group that you were the head of was compulsory, wasn't it?

HAYLER: Yes.

MR. DODD: When did you join the SS?

HAYLER: I joined the SS in 1933, in the summer.

MR. DODD: That was a kind of Party office, wasn't it, of a sort?

HAYLER: No, it was not an office. I became connected with the SS because of the fact that in Munich 165 businessmen were locked up and because I knew Himmler from my student days-I had not seen him again until then-the businessmen in Munich asked me to intercede for them in the summer of 1933. But I had no office in the Party or in the SS.

MR. DODD: When did you become a general in the SS?

HAYLER: I never was a general in the SS. After I had been appointed State Secretary, the Reichsfuehrer bestowed on me the rank of a Gruppenfuehrer in the SS.

MR. DODD: A Gruppenfuehrer-isn't that the equivalent of a general in the SS?

HAYLER: Yes and no. In the SS there was the rank of Gruppenfuehrer and there was the rank of Gruppenfuehrer and general of the Police or of the Waffen-SS; but the Gruppenfuehrer was not a general if it was only an honorary rank. This could easily be seen from our uniforms, because we did not wear a general's epaulets or a general's uniform.

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MR.DODD: You know Ohlendorf pretty well, don't you?

HAYLER: Yes.

MR. DODD: He worked for you at one time. He was under your supervision. Isn't that so?

HAYLER: I worked with Ohlendorf from 1938 on.

MR. DODD: You know, he has testified before this Tribunal that he supervised the murdering of 90,000 people; did you know that?

HAYLER: I heard about that.

MR. DODD: Did you know about it at the time that it was going on?

HAYLER: No.

MR. DODD: Did you know Pohl, the SS man-P-o-h-l?

HAYLER: May I ask you for that name again?

MR. DODD: Pohl-P-o-h-l?

HAYLER: I do not remember knowing an SS man Pohl.

MR.DODD Do you know a man called Obergruppenfuehrer Pohl of the SS?

HAYLER: No-Yes, I know an Obergruppenfuehrer Pohl. Obergruppenfuehrer Pohl was the chief of the administrative office of the SS.

MR. DODD: Did you have conversations and meetings with him from time to time?

HAYLER: Officially I had a few conversations with Pohl. Usually they were very unpleasant.

MR. DODD: Well, that's another matter. How often would you say, between 1943 and the end, the time of your surrender, that you met with Pohl to discuss matters of mutual interest between the SS and your own Ministry of Economics? Approximately, because I don't expect you to give an accurate account, but about how many times, would you say?

HAYLER: I must give a short explanation about this. Between the...

MR. DODD: Give that afterwards. Give me the figure first.

HAYLER: Yes. Perhaps three or four times, perhaps only twice. I do not know exactly.

MR.DODD: Are you telling us three or four times a year or three or four times during the whole period between 1943 and 1945?

HAYLER: During my time in office, yes, three or four times; it was only one year.

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MR.DODD: Did you talk to him about the Reichsbank's or the Ministry of Economics' co-operating in the financing of the building of factories near the concentration camps?

HAYLER: No.

MR. DODD: You know about that, do you?

HAYLER: No. This question was never discussed with me.

MR.DODD: What did you talk to him about?

HAYLER: A great controversy had arisen between the Ministry of Economics and the SS because after I had taken over the State Secretariat in the Ministry of Economics, Himmler had instructed me to turn over to the SS a factory which belonged to the Gau Berlin. I fought against this and did not obey Himmler's instructions. The files about this must surely still be in existence. I then was instructed to discuss this matter with Pohl In these conferences and in a personal conversation which Himmler requested and ordered, I still fought against Himmler's instructions, because I was fundamentally against the SS having industrial enterprises of its own.

MR. DODD: Did you talk to the Defendant Funk about this difficulty with Himmler and Pohl?

HAYLER: Yes, because these difficulties resulted in Himmler's writing me a letter in December in which he told me that he ceased to have confidence in me and that he had no desire to work with me any more. I reported this to the Defendant Funk in December.

MR.DODD: Did Funk tell you that his bank was helping Himmler out in the building of factories near the concentration camps?

HAYLER: I know nothing about that.

MR.DODD: You never heard of that before now?

HAYLER: Up until now I have never heard anything about Funk's or the Ministry of Economics' co-operation in the financing of such buildings or about anything of the sort.

MR.DODD: It is perfectly clear, I think, but I want to make certain, that from 1943 to 1945, while you were the deputy to Funk in the Ministry of Economics, the questions of purchasing on the black market, and so on, in the occupied countries ceased to be of any real importance, didn't they? You said that; I understood you to say that a few minutes ago yourself.

HAYLER: In 1944-and my time in office virtually did not start until 1944, since in December I had a Ministry which was totally bombed out and we did not get started working again

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until January 1944-these questions were no longer of decisive importance, since a process of-retrogression had already set in.

MR. DODD: AL. right. You also were, Mr. Witness' at the Vienna speech to which you referred, which was made in 1944; and it had nothing to do with the occupied countries but was directed only at the satellite states. Are you aware of that or not?

HAYLER: The speech in Vienna?

MR.DODD: Yes, the speech in Vienna in 1944.

HAYLER: Yes, it is true; I have already said that. Both the speech in Konigsberg and the speech in Vienna did not deal directly with the occupied territories, but with Europe as a whole. I...

MR.DODD: Did it deal with the occupied territories directly or indirectly? Now, have you read that speech?

HAYLER: I heard the speech. Quite definitely it had nothing to do with them directly.

MR. DODD: Finally, in view of your testimony concerning Funk and what he thought about forced labor, you know, don't you, that he took an attitude of unconcern about the forcing of people to come to Germany? Do you know that?

HAYLER: No.

MR. DODD: Well, you know he has said on interrogation that he didn't bother his head about it, although he knew that people were being forced to go to Germany against their will Are you aware of that?

HAYLER: No, I am not aware of that. I had with Funk...

MR.DODD: AL. right. If you did know it, would that make some difference to you; and would you change your testimony some?

HAYLER: I am not aware of the fact that Funk is supposed to have had this attitude or...

MR. DODD: Very welt Perhaps I can help you by reading to you from his interrogation of 22 October 1945, made here in Nuremberg. Among other things, he was asked these few questions and made a few answers:

"As a matter of fact, you were present at many meetings of the Central Planning Board, were you not?"

Funk answered and said:

"I was present at the meetings of the Central Planning Board only when something was required for my small. sector; that is to say, something which had to do with the

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export and consumer goods industries as, for example, iron. I had to put up a fight on each occasion to get just a few thousand tons for my consumer goods industry." The next question was: "Yes, but during those meetings you attended, you heard, did you not, discussions concerning forced labor?"

Funk answered: "Yes." "Question: 'And you knew from those meetings that the policy was to bring in more and more foreign workers to the Reich against their will?' " Funk answered: "Yes, certainly." "Question: 'And you never objected to that, I take it?' "

Funk answered:

"No, why should I have objected? It was somebody else's task to bring these foreign workers into the Reich. "Did you believe it was legal to take people against their will from their homes and bring them into Germany?" was the last question that I want to quote to you. He answered: "Well, many things happen in wartime which aren't strictly legal. I have never racked my brains about that."

Now, if you know that to be his attitude from his statements made under oath on an interrogation here, would that change your view about Funk and would it cause you to change the testimony which you have given before the Tribunal here today?

HAYLER: I can testify only to those things which I myself know. I cannot remember any such statements by Funk I do know and I remember distinctly that we frequently spoke about the occupied territories, about the later development in Europe which was to, and could, result from co-operation. We also spoke about the procuring of workers and that Funk fundamentally had a viewpoint different from the one that prevailed and that he was not in agreement with these things. I can merely repeat this and if you question me here as a witness, I can say only what I know.

MR.DODD: Did you go over all of your questions and answers with Dr. Sauter before you took the stand? You knew what you were going to be asked when you came here, didn't you?

HAYLER: Dr. Sauter gave me an idea what he would question me about and what he was interested in.

MR.DODD: I have no further questions.

THE PRESIDENT: Do any other members of the Prosecution wish to cross-examine? Dr. Sauter, do you want to re-examine?

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DR. SAUTER: No.

THE PRESIDENT: The witness can retire.

[The witness left the stand.7

DR. SAUTER: Mr. President, there are a few interrogatories missing, some of which have already arrived and are being translated. I request that at a later occasion, perhaps after the case against Defendant Schirach, I be permitted to read these interrogatories. And then, Mr. President, I should like to say something of a general nature. I have already read extracts from various documents and requested that all of them be admitted as evidence and I should like to repeat this request for all these documents. With that I shall have finished my case for Funk.

Mr. President, may I make another request of you at this moment, namely, that during the next few days the Defendant Von Schirach be excused from being present at the sessions in Court so that he can prepare his case. In his absence I shall look after his interests or else, when I am not here, my colleague Dr. Nelte will. Thank you very much.

THE PRESIDENT: Who is appearing for the Defendant Schirach?

DR. SAUTER: I am; and when I cannot be present, then Dr. Belle will. One of us will always be in Court and look after his interests.

THE PRESIDENT: Yes, very well, Dr. Sauter. Now the Tribunal will adjourn for 10 minutes.

[A recess was taken.7

THE PRESIDENT: Dr. Sauter, there was a document which you didn't refer to. I think it was an affidavit of a witness called Kallus. Were you offering that in evidence? It was an interrogatory of Heinz Karl Kallus.

DR. SAUTER: The Kallus interrogatory, Mr. President, has already arrived and at the moment it is in the process of translation' I shall submit it as soon as the translation has been received by the Prosecution.

THE PRESIDENT: Well, we have got a translation into English.

DR. SAUTER: I believe, Mr. President, that what you have is an affidavit by Kallus, and in addition there is a Kallus interrogatory, which is in process of translation and which I shall submit later.

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THE PRESIDENT: This takes the form of an interrogatory, questions and answers, what I have in my hand. I am only asking whether you want to offer that.

DR. SAUTER: Yes, I offer that in evidence. I request that judicial notice be taken of it.

The; PRESIDENT: Very well; you gave it a number then, did you? What number will it be?

DR.SAUTER: Exhibit Number 5, if you please.

THE PRESIDENT: Very well.

DR.SAUTER: Thank you very much.

THE PRESIDENT: Now, Dr. Kranzbuehler.

FLOTTENRICHTER OTTO KRANZBUEHLER (Counsel for Defendant Doenitz): Mr. President, first I should like to ask the permission to have a secretary, in addition to my assistant, in the courtroom, in order to facilitate the submission of documents.

With the permission of the Tribunal, I shall first submit a number of documents; and I shall use the document book of the Prosecution and the document books which I have submitted. These document books consist of four volumes. The table of contents is in Volume I and in Volume III.

In the first document of the document book of the Prosecution, Exhibit USA-12 (Document Number 2887-PS), I should like to correct an error in translation which may be of significance. It says there, in the German text, under "1939," "Konteradmiral, Befehlshaber der Unterseeboote," and that in the English text has been translated by "Commander-in-Chief." The correct translation should be "Flag Officer of Submarines." That point is of importance in regard to the fact that Admiral Doenitz, until his appointment as Commander-in-Chief of the Navy in 1943, was not a member of the group which the Prosecution terms criminal.

I should like to call the attention of the Tribunal back to Exhibit GB-190 (Document Number D-652 (a-b) ). That is a sea chart which the Prosecution has submitter This chart shows the position of the German submarines to the west of England on 3 September 1939, and the Prosecution uses that chart as evidence for the question of aggressive war.

The Prosecution says, rightly, that these U-boats must have left their home bases at an earlier date. The first document, which I offer as Doenitz-1, is to prove, first, that this belongs in the category of measures resorted to in times of crisis such as were taken by every nation in Europe at this time, and that they were in no way preparatory measures for an aggressive war against England, because such a war was not planned.

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I shall read from this document-document book, Page 1. It is an excerpt from the War Diary of the Naval Operations Staff of September 1939, and I read the entry of 15 August:

"Prepared (for Case White) the following measures:"

THE PRESIDENT: What page?

FLOTTENRICHTER KRANZBUEHLER: Page 1 of the document book, Volume I.

THE PRESIDENT: Yes.

FLOTTENRICHTER KRANZBUEHLER:

"15. 8. Prepared (for Case White) the following measures:

"On 15. 8. Spee and all Atlantic submarines ready to sail.

"On 22. 8. Transport Westerwald ready to sail.

"On 25. 8. Deutschland ready to sail."

And then we find the list of these ships:

"21. 8. Report B-service about emergency measures of French fleet.

"23. 8. Report B-service: Continuation of French emergency measures of fleet to 3rd grade. English and French blockade measures off ports.

"25. 8. B-service reports: German and Italian steamers are

being watched and reported by France."

And then the instructions:

"31. 8. Arrival Order I of OKW for conduct of war: Forcible solution in the East, attack against Poland 1 September, 0445 hours. In the West responsibility for starting hostilities unequivocally to be left to England and France. Strictly respect neutrality of Holland, Belgium, Luxembourg, Switzerland. The western border not to be crossed. At sea no hostile actions or such that could be interpreted as hostile. Air Force only in defense.

"In case of opening of hostilities by Western Popovers: Defense only, economical use of forces. Reserve start of aggressive operations. The army to hold the 'Westwall.' Naval economic war concentrated against England. To augment effect probable declaration of zones of danger. Prepare these and

submit them. The Baltic to be safeguarded against enemy invasion."

So far this document. With the next document, Doenitz-2, I should like to prove that the British submarines, too, were active before the start of the war and appeared in the Bay of Helgoland at the

very beginning of the war. It is on Page 2 of the document book. I probably need only point out that as early as 1 September electric

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motor noises were heard in the Bay of Helgoland and that on 4 September several reports arrived concerning English submarines sighted in the Bay of Helgoland.

I come now to the document with reference to which Admiral Doenitz is accused of participating in the planning of the attack against Norway. That is Exhibit GB-83 (Document Number C-5). The Prosecution has submitted it as proof of the fact that Admiral Doenitz played a decisive part in the occupation of Norway. I shall refer to this document in more detail when examining the witness. I merely want to establish certain dates now. On the document -and I am about to submit the original to the Tribunal-there is a stamp which establishes when the document was received at the High Command. This stamp shows the date 11 October 1939.

THE PRESIDENT: You are speaking of GB-837

FLOTTENRICHTER KRANZBUEHLER: Yes. And I refer now to Exhibit GB-81 (Document Number C-66), Page 6 of my document book. According to this the decisive report by Grossadmiral Raeder to the Fuehrer had already been made on 10 October 1939, that is, a day before GB-83 was received at the High Command.

With the next document I should like to prove that considerations as to bases had nothing to do with the question of an aggressive war, as far as the Flag Officer of Submarines, Admiral Doenitz, was concerned. I am submitting Documents Doenitz-3 and Doenitz-4. They are on Page 3 and 5 of the Document Book. Doenitz-3 is a war diary of the Flag Officer of Submarines of 3 November 1939, and I read from the second paragraph, the 10th line from the top:

"At the same time Naval Operations Staff reports that there are possibilities for the establishment of a 'Base North' which seem to be very promising. In my opinion the immediate introduction of all possible steps in order to arrive at a clear judgment of the existing possibilities is of the greatest importance."

And then there follows a discussion of the advantages and disadvantages of such a base, which is absolutely identical with the considerations mentioned in GB-83. It is a question of Murmansk in connection with Base North, as can be seen from Document Doenitz-4; and it is known that these considerations were in full accord with the Soviet Union.

Furthermore, I should like to show that the question of bases continuously comes up in enemy navies without reference to...

THE PRESIDENT: Dr. Kranzbuehler, you are going a little bit fast over these documents and I am not quite sure that I am quite following what use you are making of them. This base mentioned in the report is Murmansk?

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FLOTTENRICHTER KRANZB0HLER: Yes; Murmansk. And I want to use it as proof, Mr. President, that the question of bases has nothing to do with the-question of whether one wants to wage aggressive war with the country in which these bases are situated. The considerations as to Murmansk were taken in full accord with the Soviet Union, and in the same manner Admiral Doenitz took the question of Norwegian bases into consideration. That is the subject of my proof.

THE PRESIDENT: But the fact that Murmansk was suggested as a base, to be taken with the consent of the Soviet Union-if it was the case-doesn't have any relevance, does it, to taking a base in Norway without the consent of Norway.

FLOTTENRICHTER KRANZBUEHLER: Mr. President, the relevancy seems to me to exist in the fact that Admiral Doenitz, as Commander of U-boats, in both cases received merely the order to state his opinion about bases in a certain country but that in the last analysis he had as little to say in the case of Narvik and Trondheim as in the case of Murmansk.

COLONELY.V.POKROVSKY (Deputy Chief Prosecutor for the U. S. S. R.): In Document Number 3, the one just being referred to by the defense counsel for the Defendant Doenitz, mention is definitely made of the northern bases; but nothing is said in this document of any plans of the Soviet Union. And to discuss, here and now, some plan or other of the Soviet Union is in my opinion quite out of order, since there are no plans of the Soviet Union in connection with the northern bases, and there never have been.

FLOTTENRICHTER KRANZB0HLER: If the representative of the Soviet Union has any doubts that these bases were considered in full accord with the Soviet Union, then I shall prove that by calling a witness.

THE PRESIDENT. Anyhow, the document doesn't say anything about it.

FLOTTENRICHTER KRANZB0HLER: The document says nothing about it.

THE PRESIDENT: The Tribunal doesn't think you ought to make statements of that sort without any evidence; and at the moment you are dealing with a document which doesn't contain any evidence of the fact.

FLOTTENRICHTER KRANZBOHLER: May I perhaps read Document Number D5nitz - ?

THE PRESIDENT: It is Doenitz-3, isn't it?

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FLOTTENRICHTER KRANZBOHLER: I have already come to Doenitz-4. I had read from Doenitz-3. I shall now read from Doenitz-4 the entries for 17 April 1939:

"Commander of U-boats receives instructions from Naval Operations Staff to try out Base North. Naval Operations Staff considers the trying out of the base by U-36 due to sail within the next days, highly desirable. Supply goods for tanker Phoenizia in Murmansk going with fishing steamer to Murmansk on 22 November."

It seems to me that this entry very clearly shows that that could have happened only in accord with the Soviet Union. Furthermore, I want to show that considerations as to bases...

THE PRESIDENT: Wait a minute. Dr. Kranzbuehler, the Tribunal thinks you oughtn't to make these observations on these documents which really don't support what you are saying. Document Number 3, for instance, doesn't bear any such interpretation, because it refers to attacks which it was suggested should be made against ships coming from Russian ports, in Paragraph 2. And equally the other document you referred to, Doenitz-4, on Page 5, doesn't bear the interpretation which you are putting upon it.

FLOTTENRICHTER KRANZBUEHLER: Mr. President, I am afraid that the contents of both documents have been presented too quickly by me. For anyone who is familiar with such war diaries, many things are self-evident which otherwise are not so easy to understand.

Document Doenitz-3 states in that part which I have read that possibilities for the establishment of a Base North exist. These possibilities can be only political possibilities, because one can establish a base in a foreign country only if that country agrees. Document Doenitz-4 shows that the base in question is Murmansk and that this base is being tried out with a supply ship, a fishing steamer, and a U-boat. That convincingly shows in my opinion...

THE PRESIDENT: The objection the Tribunal was raising was to the statement by you that the Soviet Union had agreed, and these documents do not bear out any such statement.

FLOTTENRICHTER KRANZBUEHLER: I am of the opinion that in Document Doenitz-4 that can clearly be seen. It is not possible. . .

COL. POKROVSKY: I definitely protest against the fact that, apart from what has been stated in the documents, certain unfounded conjectures or assertions have been made with a view to interpreting the documents in the manner in which Dr. Kranzbuehler has endeavored to interpret them from the initial stages of his defense. I do not belong to the category of fortune tellers and palmists. I cannot conjecture what hypothetical conclusions may be

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drawn from one or another of the documents. I am a lawyer and I am accustomed to operate with documents such as they appear, and I am accustomed to operate with the contents of a document such as they are expressed.

I consider that the Tribunal has quite correctly expressed to the defense counsel the absolute impossibility of drawing the conclusions he is attempting to reach, and I would ask that counsel for the defense be reminded of his duty to limit himself exclusively to such interpretations as may be deduced from the document.

SIR DAVID MAXWELL-FYFE (Deputy Chief Prosecutor for the United Kingdom): Your Honor, I would be grateful if the Tribunal would consider a general point of procedure. We have a number of objections to a considerable number of Dr. Kranzbuehler's documents. I have got out a short list grouping, as far as is possible, our objections, which I can hand to the Tribunal and, of course, to Dr. Kranzbuehler, now. It is a matter for consideration by the Tribunal whether it would be useful to see that list before the Tribunal adjourns tonight, and maybe here tender certain observations of Dr. Kranzbuehler upon them. Then the Tribunal might be able to give a decision with regard to certain of the documents before sitting again tomorrow and thereby save some time. I suggest that to the Tribunal for their consideration as perhaps the most profitable procedure under the circumstances.

THE PRESIDENT: Are you suggesting that at a certain point of time we should adjourn for the consideration of your list and then hear Dr. Kranzbuehler on it?

SIR DAVID MAXWELL-FYFE: Yes.

THE PRESIDENT: That is what you suggest?

SIR DAVID MAXWELL-FYFE: Yes, Sir. I was going to explain my list, put my list to the Tribunal, and explain it; and then the Tribunal could hear Dr. Kranzbuehler upon it and adjourn at whatever time it is suitable.

FLOTTENRICHTER KRANZBUEHLER: May I make a statement in that regard, Mr. President?

THE PRESIDENT: Certainly.

FLOTTENRICHTER KRANZBOHLER: I do not agree with such a proceeding, Mr. President. Before this Tribunal I have said very little as defense counsel so far; but I am of the opinion that it is my turn now and that I have to be granted permission to submit my documents in that order in which I plan to and which I consider correct for my defense.

I ask the Tribunal just to imagine what would have happened if, before the presentation of their case by the Prosecution, I had

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said that I should like to speak about the relevancy of the documents of the Prosecution. I believe that this comparison shows that I should not have thought of proceeding in this way. I shall try, before submitting my documents, to explain their relevancy to a greater extent than I have thought necessary until now. But I ask the Tribunal to grant that I present my case now and to limit the Prosecution to making their suggestions when I submit my documents individually.

SIR DAVID MAXWELL-FYFE: The inconvenience of that course, My Lord, is that I shall then be interrupting Dr. Kranzbuehler every two or three documents and making a specific objection to an individual document, which will take a great deal of time. I thought it would be more convenient if I indicated to the Tribunal my objections to the documents in the usual way by classes rather than individually.

I put it to the Tribunal to rule on whatever method they think would be most convenient for them. The last thing I want is to interfere with Dr. Kranzbuehler's presentation; but, on the other hand, the method that he suggests will mean individual objections, because, of course, an objection is useless if it is put in after Dr. Kranzbuehler has developed the document. Or, if it is not useless, it is at any rate of very much less weight.

THE PRESIDENT: Dr. Kranzbuehler, supposing that Sir David presents his objections to the documents now, whether in groups or in whatever way he likes, and you then answer him individually upon each document, pointing out the relevance in your view of each document; how does it harm you? The Tribunal will then consider your arguments and will rule upon them, and then you will know what documents the Tribunal has ruled out, and you can then refer to any of the other documents in any way you please.

The only object of it and the only effect of it is to prevent the Prosecution's having to get up and interrupt, put on the earphones, and take the time for an individual objection to each document to which they wish to object as it turns up. I cannot see that it can interfere with you in the least.

FLOTTENRICHTER KRANZBt1HLER: Mr. President, I have no objection to the Prosecution's stating their objections now. I merely wish to avoid my having to reply to each individual objection. If I am permitted to state my views when each individual document comes up, then I have no objection to the Prosecution's stating their objections now to individual documents.

THE PRESIDENT: Sir David, the Tribunal would like you to state now your objections to these documents. They will then allow Dr. Kranzbuehler to proceed with his discussion of the documents,

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answering your argument as to the admissibility of each document that you object to when he comes to it.

SIR DAVID MAXWELL-FYFE: If Your Lordship please. Will Your Lordship just allow me a moment to get my papers? I am afraid I have only the Prosecution's objections in English, but it may help those of the Tribunal who do not understand English to have the numbers, at any rate, in front of them.

My Lord, the first group are documents which the Prosecution submits have no probative value. These are D-53. My Lord, the

'ID" in this case stands for Doenitz Document Book 53, Page 99; and D-49, Pages 130 and 131; D-51 and D-69.

My Lord, the first of these, D-53, is a letter from a prisoner-of

war camp, purporting to be signed by 67 U-boat commanders and in purely general terms. The Prosecution submits that that is not helpful, either from its form or from its material.

My Lord, D-49, which is at Pages 130 to 131, is again in entirely general terms and contains no indication of the moral or legal basis for the opinion expressed.

D-51 and D-69 are both newspaper reports.

THE PRESIDENT: Wait a minute, Sir David. 130? I have not

got a Page 131. Is it an affidavit, or was it called an affidavit?

SIR DAVID MAXWELL-FYFE: Yes, My Lord.

THE PRESIDENT: "On the basis of the documents of the Navy Court archives at..."

Oh yes, I think the Document Book has got a bit out of order.

SIR DAVID MAXWELL-FYFE: Yes, My Lord, maybe so.

THE PRESIDENT: Is it a sworn affidavit by somebody or other?

SIR DAVID MAXWELL-FYFE;: Yes, My Lord. 130 comes immediately before.

THE PRESIDENT: I have got it now, yes. 131 comes somewhere before 130.

SIR DAVID MAXWELL-FYFE: That is it, My Lord. It is an affidavit by a former fleet judge, and Your Lordship sees that the description which the Prosecution gives of it as being in entirely general terms is, I submit, justified by the wording of the document, and it is difficult to see the basis which the learned opponent seems to profess for his statements.

My Lord, D-51, Page 134, is an extract from the Volkischer Beobachter of March 1945, and the Prosecution submits that the topic on which it is is irrelevant to the matters developed against the Defendant Doenitz. Number 69 is another newspaper report from the same paper of 14 November 1939, giving a list of armed

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British and French passenger ships. Now, My Lord, the second group which we developed are those irrelevant documents, D-5, D-9, D-10, D-12, D-13, D-29, D-48, D-60, D-74.

Now, My Lord, the first of these, D-5, on the subject of Norway, seeks to introduce by way of a footnote a summary of the documents which the Tribunal dealt with when considering the documents in the case of the Defendant Raeder, with regard to which the Tribunal expressed its doubts, although it allowed them to be translated. The Tribunal will remember that with regard to the Doenitz documents it was thought convenient to have them translated without a preliminary argument. Now, My Lord, the same argument applies to a footnote, to a speech of the Defendant Von Ribbentrop, a summary of documents which came into German possession long after the speech of the Defendant Ribbentrop was made. The Prosecution submits it is irrelevant.

And the documents 9, 10, 12, and 13 deal with the rescue of Allied survivors in the years 1939 to 1941 inclusive.

THE PRESIDENT: Oh, yes.

SIR DAVID MAXWELL-FYFE: My Lord, that last statement, "and all apparently unsworn," is an error. It ought to be that D-13 is apparently unsworn.

Now, My Lord, with regard to that the position is that whereas it is quite true that a non-rescue order was issued by the defendant before 27 May 1940, the really important period is round about 17 September 1942. It seemed to the Prosecution unnecessary to go into these details for the earlier period. There is no real doubt that there were some rescues. The only point which the Prosecution is putting against the defendant is that he did issue an order, which the Prosecution has proved, forbidding rescue when there was any danger.

THE PRESIDENT: What was the date you gave us, 17 November 1942?

SIR DAVID MAXWELL-FYFE: My Lord, the non-rescue order is before 27 May 1940. We cannot give the exact date, but we know from a reference in another order that it must have been before 27 May 1940. And the order with regard to the destruction of the crews of merchant ships is 17 September 1942.

Now, My Lord, the Document Number 29 contains four documents dealing with the evidence of the witness Heisig. The first purports to be an affidavit by a witness who speaks to the sort of statements the Defendant Doenitz usually made and does not remember what was said on the particular occasion referred to by the witness Heisig; and it contains a good deal of argument.

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The second is a letter sent to counsel for the Defendant Doenitz, and, with the exception of one sentence, denying that the defendant spoke in the sense alleged by Heisig; the remainder of the statement which, of course, is unsworn, is either argument or is vague or irrelevant. The remaining two documents, both apparently unsworn, contain allegations against the character of the witness Heisig. The Tribunal will remember that no allegations were made against him; that there was no crossexamination in regard to his character when he gave his evidence. And the second deals with other lectures which are not those in question.

Now, My Lord, the next document, D-48, deals with the alleged good treatment of Allied prisoners in German Naval prisoner-of-war camps, on which subject no issue has been raised with this defendant. D-60, Page 209 deals with Italian- and French-declared danger zones, which, the Prosecution submits, has no relevance to those declared by the Germans. D-74 and D-60, Page 256, deal with the relationship between the British and French merchant marines and their respective navies; and the Prosecution submits that they are irrelevant as far as the British Navy is concerned, if they have any relevance cumulative of D-67.

Now, My Lord, the third group are details of the Contraband Control System and they are D-60, Pages 173 to 198; D-72; D-60, Pages 204 and 205 and Pages 219 to 225. My Lord, these documents deal with the details of the contraband control, what articles were contraband, declarations of different governments; and it is submitted that details of the contraband control are remote from the issues raised and entirely irrelevant. I do not think in the presentation against either of the Naval defendants questions of declarations of contraband were mentioned at all, certainly not in regard to the Defendant Doenitz; and, in the submission of the Prosecution, it's really introducing matters which are, I am sure, not helpful to the problems of this case.

The fourth group, which can only be described in very general terms, are allegations against the Allies. My Lord, the general objection I set out in the first paragraph is this: Those documents consist of various allegations against the Allies; they appear to have little or no relevance to the issues and, if submitted, might necessitate the Prosecution's seeking the facilities to rebut the allegations; in which case a large volume of evidence in rebuttal might be entailed.

Then I have isolated those which deal with allegations that the Allies did not pick up survivors; there are two: 43, 67; Pages 96 and 90. 31 and 32 deal with Allied attacks on German air-sea rescue planes; 33 accuses a Soviet submarine of sinking a hospital ship.

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And three, Numbers 37, 38, and 40, the last being a newspaper report, allege that the Allies shot survivors. My Lord, the question of Allied treatment of survivors is dealt with exhaustively by extract from the German Naval Diary and, My Lord, that we are not objecting to because there it is important not as evidence of the facts stated but as evidence of the matters that had an effect on the German Naval Command. For that purpose I am quite ready that Dr. Kranzbuehler should put them in and the Tribunal should consider them. And there is another document which deals with that point quite fully, and I am quite prepared to let that go in.

Then, My Lord, the remainder allege either ruthless actions or breaches of International Law by the Allies; and these are Number 19, Page 24, the Goering exhibit; Numbers 7 and C-21, Page 91; 47, Pages 120, 121, which is also a newspaper report; 52, 60, Pages 152 and 208; D-75, 81, 82, 85, and 89.

Now, as I understand the defense that is developed here-the allegation with regard to the order which we say sets out the destruction of survivors-it is not that it was a reprisal, but the defense is that the order did not mean destruction but merely meant non-rescue. On that basis it seems difficult, indeed impossible, to appreciate how these matters become relevant at all.

And similarly with regard to the order for ghosting Commandos. The justification alleged for the order is set out in the order itself. I haven't heard any defendant develop any justification of that order in giving evidence before the Tribunal. Every one of the defendants so far has said this order was given by Hitler and "whether we approved of it or not we had to carry it out."

So that, in my submission, there isn't even the argument which is foreshadowed, that breaches of the laws and usages of war can be in certain occasions properly committed as reprisals. It is not put forward from that point of view; there is no admission here, as I understand the Defense, of breaches for which reprisal is the answer. Therefore, the Prosecution submits that these documents are also irrelevant.

My Lord, again I tried to put it as shortly as possible because I didn't want to occupy too much time, but I tried to correct them and describe those which seemed of greatest importance.

THE PRESIDENT: The Tribunal would like to know why this matter of the admissibility of these documents hasn't been argued before. In the other cases with which we have dealt, the question of the admissibility has been dealt with first of all by your offering your criticisms and objections, and then the defendant's counsel's being heard in reply. Then the Tribunal has ruled.

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SIR DAVID MAXWELL-FYFE: My Lord, as I understand the position, we did put in objections to the documents and Dr. Kranzbuehler suggested that he would very much prefer the documents to be translated and the objections taken at a later stage. And I was certainly informed that the Tribunal agreed with that and ordered the document to be translated.

THE PRESIDENT: That may be, for the purposes of translation. But that doesn't mean that they are necessarily admissible. And in most of the other cases, if not all, as you will remember, we have had an argument in open session in which you, or one other member of the Prosecution, have made your objections, and then the defendant's counsel has replied to those objections.

SIR DAVID MAXWELL-FYFE;: My Lord, Dr. Kranzbuehler has just handed-yes...

The ruling is:

"The Tribunal has ruled that the documents mentioned in your application may be translated, but that the question of their admissibility is to be decided later."

My Lord, I am afraid I am at fault there. It didn't occur to me, if I may be quite frank with the Tribunal, that I should have come before the beginning of the case Doenitz to make this argument. I am very sorry, and I must accept responsibility. I assumed, without real justification, that that meant the argument of admissibility would come at the beginning, or at some convenient time, in the case of Doenitz. I am very sorry, My Lord, and I can only express my regret.

My Lord, there is this excuse: We had three of the books on Saturday, and we only got the last one yesterday. Therefore, we really couldn't have done it before today, even if I had thought of it.

THE PRESIDENT: Dr. Kranzbuehler, the Tribunal considers that in view of the large number of documents to which the Prosecution objects, it will be highly inconvenient to have you answer Sir David Maxwell-Fyfe's argument as you go through your documents; and therefore that you must answer now and deal with them in the way in which the other counsel have dealt with these objections to the admissibility of documents. Then the Tribunal will be able to consider the arguments that Sir David Maxwell Fyfe has put forward and the arguments that you put forward in support of the documents.

FLOTTENRICHTER KRANZBUEHLER: Mr. President, I should like to point out that just because of the many objections which the Prosecution makes against the documents, I have for practical

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purposes to present all my documents, for the line of thought pursued in presenting documentary evidence implies a definite order of presentation and I cannot take out one document or another without disturbing this line of thought. Therefore, I believe it would save considerable time if the Tribunal would permit me to answer the objections when I come to the particular document.

THE PRESIDENT: What difference could it make, assuming that the decision of the Tribunal is the same, whether you argue the matter now or whether you argue the matter afterwards? The documents which will remain, which will have been held to be admissible, will be the same. Therefore, there is no difference. I can't see any argument in favor of what you are saying.

FLOTTENRICHTER KRANZBOHLER: Mr. President, my documentary material, exactly like that of the Prosecution, is organized with a definite purpose in mind and according to a definite idea. If, of the 50 documents which are contained in my documentary material, I have to argue about 40, then 10 are lacking. Therefore, it seems to me proper for me to discuss all 50, in the order in which I intended to submit them to the Tribunal.

If the Tribunal is of the opinion that the reasons given for the relevancy of the different documents are not sufficient, then the objectionable document can be withdrawn or refused. However, it seems expedient to me that I present my arguments in the order which I have been intending to follow, and not in the order in which the Prosecution is now making its objections. That defeats my purpose and disturbs my line of thought and, as defense counsel, I believe it is my task to present my own line of thought and not to reply to the line of thought pursued by the Prosecution or to their objections.

THE PRESIDENT: Well, if that is so, then you can present your argument upon the relevancy of the documents in the order in which they come.

FLOTTENRICHTER KRANZB0HLER: Yes.

THE PRESIDENT: But you have to do it now.

FLOTTENRICHTER KRANZB0HLER: Yes, Mr. President.

THE PRESIDENT: You can begin with D-5, which is the first, and then go on with D-9 and D-10; take them in the order in which they stand.

Dr. Kranzbuehler, the Tribunal doesn't see any reason why you should be dealt with in a different way from which the other defendants have been treated. Therefore, they think that you ought to be prepared to deal with these documents in the way in which they are grouped here. They would prefer that you should

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deal with them now, if you can deal with them in a reasonably short space of time. Then they will be able to determine the question of which documents shall be admitted during the adjournment. Otherwise, they will have to adjourn tomorrow for a consideration of that matter, which will still further hold up the trial.

FLOTTENRICHTER KRANZBt1HLER: Mr. President, of course, I can make general statements as to the groups which the Prosecution has referred to, but I cannot refer to the individual documents with the necessary detail to establish their relevancy unequivocally. That is impossible for me, confronted as I am by a list which I have not seen before. Therefore I should like to ask, if I am to give reasons for each individual document now, that I be given an opportunity to do that tomorrow morning. However, if the Tribunal wishes only to hear general remarks about the groups, I can do that right now.

THE PRESIDENT: Very well, Dr. Kranzbuehler. The Tribunal will adjourn now, and we will hear you upon these documents at 9:30 tomorrow morning.

FLOTTENRICHTER KRANZBUEHLER: In open session, Mr. President?

THE PRESIDENT: In open session, certainly, yes.

[The Tribunal adjourned until 8 May 1946, at 0930 hours.]

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