Funk is indicted under all four counts. Funk, who had previously been a financial journalist, joined the Nazi Party in 1931, and shortly thereafter became one of Hitler's personal economic advisors. On January 30, 1933 Funk was made press Chief in the Reich Government, and on March 11, 1933, became Under Secretary in the Ministry of Propaganda and shortly thereafter a leading figure in the various Nazi organizations which were used to control the press, films, music and publishing houses. Funk took office as Minister of Economics and Plenipotentiary General for War Economy in early 1932 and as President of the Reichsbank in January 1939. He succeeded Schacht in all three of these positions. He was made a member of the Ministerial Council for the Defense of the Reich on August 1939, and a member of the Central Planning Board in September 1943. wage aggressive war had been clearly defined. One of his representatives attended a conference on October 14, 1938, at which Goering announced a gigantic increase in armaments and instructed the Ministry of Economics to increase exports to obtain the necessary exchange. On January 28, 1939, one of Funk's subordinates sent a memorandum to the OKW on the use of prisoners of war to make up labor deficiencies which would arise in case of mobilization. On May 30, 1939, the Under Secretary of the Ministry of Economics attended a meeting at which detailed plans were made for the financing of the war.
that his plans for the "financing of the war," for the control of wage gratitude that he had been able to participate in such world Shaking events; and price conditions and for the strengthening of the Reichsbank had been completed; and that he had inconspicuously transferred into gold all foreign exchange resources available to Germany.
On October 14, 1939, after the war had begun, Funk made a speech in which he stated that the economic and financial departments of Germany working under the Four Year Plan had been engaged in the secret economic preparation for war for over a year. on the USSR. His deputy held daily conferences with Rosenberg on the economic problems which would arise in the occupation of Soviet territory. Punk himself participated in planning for the printing of ruble notes in Germany prior to the attack to serve as occupation currency in the USSR. After the attack he made a speech, in which he described plans he had made for the economic exploitation of the "vast territories of the Soviet Union" which were to be used as a source of raw material for Europe. plans for aggressive war. His activity in the economic sphere was under the supervision of Goering as Plenipotentiary General of the Four Year Plan. He did, however, participate in the economic preparation for certain of the aggressive wars, notably those against Poland and the Soviet Union, but his guilt can be adequately dealt with under Count Two of the Indictment.
In his capacity as Under Secretary in the Ministry of Propaganda and Vice-Chairman of the Reichs Chamber of Culture, Funk had participated in the early Nazi program of economic discrimination against the Jews.
On November 12, 1938, after the pogroms of November, he attended a meeting held under the chairmanship of Goering to discuss the solution of the Jewish problem and proposed a decree providing for the banning of Jew from all business activities, which Goering issued the same day under the authority of the Four Year Plan. Punk has testified that he was shocked at the outbreaks of November 10, but on November 15, he made a speech describing these outbreaks as a "violent explosion of the disgust of the German people, because of a criminal. Jewish attack against the German people," and saying that the elimination of the Jaws from economic life followed logically their elimination from political life. which the Reichsbank was to receive certain gold and jewels and currency from the SS and instructed his subordinates, who were to work out the details, not to ask too many questions. As a result of this agreement the SS sent to the Reichsbank the personal belongings taken from the victims who had been exterminated in the concentration camps. The Reichsbank kept the coins and bank notes and sent the jewels, watches and personal belongings to Berlin Municipal Pawn Shops. The gold from the eyeglasses, and gold teeth and fillings was stored in the Reichsbank vaults. Funk has protested that he did not knew that the Reichsbank was receiving articles of this kind. The Tribunal is of the opinion that Funk either knew what was being received or was deliberately closing his eyes to what was being done.
Funk participated in the economic exploitation of occupied territories.
He was President of the Continental Oil Company which was charged with the exploitation of the oil resources of occupied territories in the East. He was responsible for the seizure of the gold reserves of the Czechoslovakian Nation Bank and for the liquidation of the Yugoslavian National Bank. On June 6, 1942, Funk's deputy sent a letter to the OKW requesting that funds from the French Occupation Cost Fund be made available for black market purchases. Funk's knowledge of German occupation policies is shown by his presence at the meeting of August 8, 1942, at which Goering addressed the various German occupation chiefs, told them of the products required from their territories, and added: "It makes no difference to me in this connection if you say that your people will starve." Planning Board which determined the total number of laborers needed for German industry, and required Sauckel to produce them, usually by deportation from occupied territories. Funk did not appear to be particularly interested in this aspect of the forced labor programme, and usually sent a deputy to attend the meetings, often SS General Ohlendorf, the former Chief of the SD inside of Germany and the former Commander of Einsatzgruppe D. But Punk was aware that the Board of which he was a member was demanding the importation of slave laborers, and allocating them to the various industries under its control. involved in the utilization of concentration camp labor. Under his direction the credit of the SS for the construction of factories to use the Reichsbank set up a revolving fund of 12,000,000 Reichsmarks to concentration camp laborers.
Funk was never a dominant figure in the various programs in which he participated. This is a mitigating fact of which the Tribunal takes notice. guilty under Counts Two, Three and Four.
THE PRESIDENT: The Court will adjourn for 10 minutes.
(Ashort recess was taken) Schacht is indicted under Counts One and Two of the Mr. BIDDLE:
SCHACHT Indictment. Schacht served as Commissioner of Currency and President of the Reichsbank from 1923 to 1930; was reappointed President of the bank on March 17, 1933; Minister of Economics in August 1934; and Plenipotentiary General for War Economy in May 1935. He resigned from these two positions in November 1937, and was appointed Minister without Portfolio. He was reappointed as President of the Reichsbank for a one-year term on March 16, 1957, and for a four-year term on March 9, 1938, but was dismissed on January 20, 1939. He was dismissed as Minister without Portfolio on January 22, 1943. before its accession to power on January 30, 1933, and supported the appointment of Hitler to the post of Chancellor. After that date he played an important role in the vigorous rearmament program which was adopted, using the facilities of the Reichsbank to the fullest extent In the German rearmament effort. The Reichsbank, in its traditional capacity as financial agent for the German Government floated longterm Government loans, the proceeds of which were used for rearmament. He devised a system under which five year notes, known as M.E.F.O. bills, guaranteed by the Reichsbank and backed, in effect, by nothing more than its position as a bank of issue, were used, to obtain large sums for rearmament from the short-term money market. As Minister of Economics and as Plenipotentiary General for War Economy he was active in organizing the trial mobilization and the coordination of the Army with German economy for war.
He made detailed plans for indusindustry in the event of war. He was particularly concerned with shortages of raw materials and started a scheme of stock-piling, and a system of exchange control designed to prevent Germany's weak foreign exchange position from hindering the acquisition abroad of raw materials needed for rearmament. On May 3, 1935, he sent a memorandum to Hitler stating that "the accomplishment of the armament program with speed and in quantity is the problem of German politics, that everything else therefore should be subordinated to this purpose."
Schacht, by April 1936, "began to lose his influence as the central figure in the German rearmament effort when Goering was appointed Coordinator for Raw Materials and Foreign Exchange. Goering advocated a greatly expanded program for the production of synthetic raw materials which was opposed by Schacht on the ground that the resulting financial strain might involve inflation. The influence of Schacht suffered further when on October 16, 1936, Goering was appointed Plenipotentiary for the Four Year Plan with the task of cutting "the entire economy in a state of readiness for war" within four years. Schacht had opposed the announcement of this plan and the appointment of Goering to head it, and it is clear that Hitler's action represented a decision that Schacht's economic policies were too conservative for the drastic rearmament policy which Hitler wanted to put into effect.
After Goering's appointment, Schacht and Goering promptly became embroiled in a series of disputes. Although there was an element of personal controversy running through those disputes, Schacht disagreed grounds, advocated a retrenchment in the rearmament programme, opposed with Goering on certain basic policy issues.
Schacht, on financial as uneconomical much of the proposed expansion of production facilities, particularly for synthetics, urged a drastic tightening on government credit and a cautious policy in dealing with Germany's foreign exchange reserves. As a result of this dispute and of a bitter argument in which Hitler accused Schacht of upsetting his plans by his financial methods, Schacht went on leave of absence from the Ministry of Economics on September 5, 1937, and resigned as Minister of Economics and as Plenipotentiary General for war Economy on November 16, 1937. disputes. Throughout 1938, the Reichsbank continued to function as the financial agent for the German Government in floating long-term loam to finance armaments. But on March 31, 1938, Schacht discontinued the practice of floating short-term notes guaranteed by the Reichsbank for armament expenditures. At the end of 1938, in an attempt to regain control of fiscal policy through the Reichsbank, Schacht refused an urgent request of the Reichsminister of Finance for a special credit to pay the salaries of civil servants which were not covered by existing funds. On January 2, 1939, Schacht held a conference with Hitler at which he urged him to reduce expenditures for armaments. On January 7, 1939, Schacht submitted to Hitler a report signed by the Directors of the Reichsbank which urged a drastic curtailment of armament expenditures and a balanced budget as the only method of preventing inflation. On January 19, Hitler dismissed Schacht as President of the Reichsbank. On January 22, 1943, Hitler dismissed Schacht as Reichs Minister without fight of the German nation."
On July 23, 1944, Schacht was arrested by Portfolio because of his "whole altitude during the present fateful the Gestapo and confined in a concentration camp until the end of the war.
It is clear that Schacht was a central figure in Germany's rearmament program, and the steps which he took, particularly in the early days of the Nazi regime, were responsible for Nazi Germany's rapid rise as a military power. But rearmament of itself is not criminal under the Charter. To be a crime against peace under Article 6 of the Charter it must be shown that Schacht carried out this rearmament as part of the Nazi plans to wage aggressive wars. program only because he wanted to build up a strong and independent Germany which would carry out a foreign policy which would command respect on an equal basis with other European countries; that when he discovered that the Nazis were reaming for aggressive purposes he attempted to slow down the speed of rearmament; and that after the dismissal of von Fritsch and von Blomberg he participated in plans to get rid of Hitler, first by deposing him and later by assassination. rearmament programme for financial reasons. Had the policies advocated by him been put into effect, Germany would not have been prepared for a general European war. Insistence on his policies led to his eventual dismissal from all positions of economic significance in Germany. On the other hand, Schacht, with his intimate knowledge of German finance, was in a peculiarly good position to understand the true significance of - Hitler's frantic rearmament, and to realize that the economic policy adopted was consistent Moreover Schacht continued to participate in German only with war as its object.
economic life and even, in a minor way, in some of the early Nazi aggressions. Prior to the occupation of Austria he set a rate of exchange between the mark and the schilling. After the occupation of Austria he arranged for the incorporation of the Austrian National Bank into the Reichsbank and made a violently pro-Nazi speech in which he stated that the Reichsbank would always be Nazi as long as he was connected with it, praised Hitler, defended the occupation of Austria, scoffed at objections to the way it was carried out, and ended with to our Fuehrer a triple 'Sieg Heil'." He has not contended that this speech did not represent his state of mind at the time. After the occupation of the Sudetenland, he arranged for currency conversion and for the Incorporation into the Reichsbank of local Czech banks of issue. On November 29, 1938, he made a speech in which he pointed with pride to his economic policy which had created the high degree of German armament, and added that this armament had made Germany's foreign policy possible. specific wars of aggression charged in Count Two. His participation in the occupation of Austria and the Sudetenland (neither of which are charged as aggressive wars) was on such a limited basis that it does not amount to participation in the common plan charge in Count One. He was clearly not one of the inner circle around Hitler which was most closely involved with this common plan. He was regarded by this group with undisguised hostility. The testimony of Speer shows that Schacht's arrest on July 23, 1944, was based as much on Hitler's enmity towards Schacht growing out Of his attitude plot.
The case against Schacht therefore depends on the inference before the war as it was on suspicion of his complicity in the bomb that Schacht did in fact know of the Nazi aggressive plans.
prosecution, and a considerable volume of evidence for the defense. The Tribunal has considered the whole of this evidence with great card, and comes to the conclusion that this necessary inference has not been established beyond a reasonable doubt. and directs that he shall he discharged by the Marshal, when the Tribunal presently adjourns.
Doenitz is indicted on Counts One, Two and Three. In 1935 he took M. de VABRES:
DOENITZ command of the first U-Boat flotilla commissioned since 1918, became in 1936 commander of the submarine arm, was made Vice-Admiral in 1940, Admiral in 1942, and on January 30, 1943 Commander-in-Chief of the German Navy. On 1 May 1945 he became the Head of State, succeeding Hitler. does not show be was privy to the conspiracy to wage aggressive wars or that he prepared and initiated such wars. He was a line officer performing strictly tactical duties. He was not present at the important conferences when plans for aggressive wars were announced, and there is no evidence he was informed about the decisions reached there. Doenitz did, however, wage aggressive war within in the meaning of that word as used by the Charter. Submarine warfare which began immediately upon the outbreak of war, was fully coordinated with the other branches of the Wehrmacht. It is clear that his U-Boats, few in number at the time, were fully prepared to wage war. Chief he Was not an "Oberbefehlshaber". But this statement underestimates the importance of Doenitz' position. He was no more Army or division commander, The U-Boat arm was the principal part of the German fleet and Doenitz was its leader. The High Seas fleet made a few minor, if spectacular, raids during the early years of the war but the real damage to the tons of allied and neutral shipping sunk will testify.
Doenitz was enemy was done almost exclusively by his submarines as the millions of solely in charge of this warfare.
The Naval War Command reserved for itself only the decision as to the number of submarines in each area. In the invasion of Norway, for example, Doenitz made recommendations in October 1939 as to submarine bases, which he claims were no more than a staff study, and in March 1940 he made out the operational orders for the supporting U-Boats, as discussed elsewhere in this Judgment. eloquently proved by Raeder's recommendation of Doenitz as his successor and his appointment by Hitler on 30 January 1943 as Commander-in-Chief of the Navy. Hitler too knew that submarine warfare was the essential part of Germany's naval warfare. Hitler. The evidence was that they conferred on naval problems about 120 times during the course of the war. Doenitz as its Commander-in-Chief urged the Navy to continue its fight. On 1 May 1945 he became the head of State and as such ordered the Wehrmacht to continue its war in the East, until capitulation on 9 May 1945. Doenitz explained that his reason for these orders was to insure that the German civilian population might be evacuated and the Army might make an orderly retreat from the East. active in waging aggressive War.
Doenitz is charged with waging unrestricted submarine war-
fare contrary to the Naval Protocol of 1936, to which Germany acceded, and which reaffirmed the rules of submarine warfare laid down in the London Naval Agreement of 1930. the German U-Boat arm began to wage unrestricted submarine warfare noon all merchant ships, whether enemy or neutral, cynically disregarding the Pretocol; and that a calculated effort was made throughout the war to disguise this practice by making hypocritical references to international law and supposed violations by the Allies. within the confines of international law and of the Protocol. He testified that when the war began, the guide to submarine warfare was the German Prize Ordinance taken almost literally from the Protocol, that pursuant to the German view, he ordered submarines to attach all merchant ships in convoy, and all that refused to stop or used their radio Upon sighting a submarine. When his reports indicated that British merchant ships were being used to give information by wireless, were being armed and were attacking submarines on sight, he ordered his submarines on 17 October 1939 to attack all enemy merchant ships without warning on the ground that resistance-was to be expected. Orders already had been issued on 21 September 1939 to attack all ships, including neutrals, sailing at night without lights in the English Channel. warning to neutral shipping that, owing to the frequent engagements taking place in between U-Boats and Allied.
merchant ships which were armed the waiters around the British Isles and the French Coast and had instructions to use those arms as well as to ram UBoats, the safety of neutral ships in those waters could no longer be taken for granted.
On the first of January, 1940, the German U-Boat command, acting on the instructions of Hitler, ordered U-Boats to attack all Greek merchant ships in the zone surrounding the British Isles which was banned by the United States to its own ships and also merchant ships of every nationality in the limited area of the Bristol Channel. Five days hater a further order was given to U-Boats to "make immediately unrestricted use of weapons against all ships" in an area of the North Sea, the limits of which were defined. Finally on the 18th of January, 1940, U-Boats were authorized to sink, without warning, all shies "in those waters near the enemy coasts in which the use of mines can be pretended". Exceptions were to be made in the cases of United States, Italian, Japanese and Soviet Ships. in accordance with its Handbook of instructions of 1938 to the merchant navy, armed its merchant vessels, in many cases convoyed them with armed escort, gave orders to send position reports upon sighting submarines, thus Integrating merchant vessels into the warning network of naval intelligence. On British merchant ships had been ordered to ram U-Boats if possible. is not prepared to hold Doenitz guilty for his conduct of submarine warfare against British armed merchant ships. sinking of neutral merchant vessels which enter those zones presents a different question. This adopted in retaliation by Great Britain.
The Washington con-
practice was employed in the War of 1914-1918 by Germany find ference of 1922, the London Naval Agreement of 1930 and the Protocol of 1936 were entered into with full knowledge that such zones had been employed in the First World War. Yet the Protocol made no exception for operational zones. The order of Doenitz to sink neutral ships without warning when found within these zones was, therefore in the opinion of the Tribunal, a violation of the Protocol. only did not carry out the warning and rescue provisions of the Protocol but that Doenitz deliberately ordered the killing of survivors of shipwrecked vessels, whether enemy or neutral. The prosecution has introduced much evidence surrounding two orders of Doenitz, War Order No. 154, issued in 1939, and the so-called "Laconia" order of 1942. The defense argues that these orders and the evidence supporting them do not show such a policy and introduced much evidence to the contrary. The Tribunal is of the opinion that the evidence does not establish with the certainty required that Doenitz deliberately ordered the killing of shipwrecked survivors. The orders were undoubtedly ambiguous, and deserve the strongest censure. were not carried out and that the defendant ordered that they should not be carried out. The argument of the defense is that the security of the submarine is, as the first rule of the sea, paramount to rescue and that the development of aircraft made rescue impossible. This may be so, but the Protocol is explicit. If the commander cannot rescue, then under its terms he cannot sink a merchant vessel and should allow it to pass harmless before his periscope. These orders, then, prove Doenitz is guilty of a violation of the Protocol.
an order of the British Admiralty announced on the 8 May 1940 according to which all vessels should be sunk at night in the Skagerrak, and the answers to interrogatories by Admiral Nimitz stating that unrestricted submarine warfare was carried on in the Pacific Ocean by the United States from the first day that nation entered the war, the sentence of Doenitz is not assessed on the ground of his breaches of the international law of submarine warfare.
Doenitz was also charged with responsibility for Hitler's Commando Order of 18 October 1942. Doenitz admitted he received and knew of the order when he was Flag Officer of U-Boats, but disclaimed responsibility. He points out that the order by its express terms excluded men captured in naval warefare, that the Navy had no territorial commands on land, and that submarine commanders would never encounter commandos. Navy, in 1943, the members of an allied motor torpedo boat were captured by German Naval Forces. They were interrogated for intelligence purposes on behalf of the local admiral, and then turned over by his order to the SD and shot. Doenitz said that if they were captured by the Navy their execution was a violation of the commando order, that the execution was not announced in the Wehrmacht communique, and that he was never informed of the incident. He pointed out that the admiral in question was not in his chain of command, but was subordinate to the army general in command of the Norway occupation. But Doenitz permitted the order to remain in full force when he became commander-in-chief, and to that extent he is responsible. "12,000 concentration camp prisoners will be employed in the shipyards as additional labor." At and claims that this was merely a suggestion at the meeting of ships, that he took no steps to get these workers since it whether they ever were procured.
He admits he knew of concentration camps.
A man in his position must necessarily advantages.
The summary of Doenitz' attitude shown in the notes taken by an officer, included the following sentence:
"It would be better to carry out the measures all costs to save face with the outer world."
The prosecution insisted that "the measures" referred to broken at will.
The defense explanation is that Hitler wanted to break the Convention for two reasons:
to take groups to the British and Americans; and also to permit bombing raids.
Doenitz claims that what he meant by "measures" were disciplinary measures against German troops to measures against the Allies; moreover that this was merely Germans.
The Tribunal, however, does not believe this ex-
such measures were ever taken, either against Allies or planation. The Geneva Convention was not, however, denounced by Germany. The defense has introduced several affidavits to prove that British naval prisoners of war in camps under Doenitz' jurisdiction were treated strictly according to the Convention, and the Tribunal takes this fact into consideration, regarding it as a mitigating circumstance. circumstance. of the Indictment, and is guilty on Counts Two and Three.
THE PRESIDENT:
Raeder is indicted on Counts One, Two, and Three. In 1928 he became Chief of Naval Command and in 1935 Oberbefehlshaber der Kriegsmarine (OKM); in 1939 Hitler made him Gross-Admiral. He was a member of the Reich Defense Council. On 30 January 1943, Doenitz replaced him at his own request, and he became Admiral Inspector of the Navy, a nominal title. Navy; he accepts full responsibility until retirement in 1943. He admits the Navy violated the Versailles Treaty, insisting it was "a matter of honor for every man" to do so, and alleges that the violtations were for the most part minor, and Germany built less than her allowable strength. These violations, as well as those of the Anglo-German Naval Agreement of 1935, have already been discussed elsewhere in this Judgment. special preparations for war against Austria. He was one of the five leaders present at the Hoszbach Conference of 5 November 1937. He claims Hitler merely wished by this conference to spur the Army to faster rearmament, insists he believed the questions of Austria and Czechoslovakia would be settled peacefully, as they were, and points to the new naval treaty with England which had just been signed. He received no orders to speed construction of U-Boats, indicating that Hitler was not planning war.
Raeder received directives on "Fall Gruen" and the directives on "Fall Weiss" beginning with that of 3 April 1939; the latter directed the was also one of the few chief leaders present at the meeting Navy to support the Army by intervention from the sea.