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Full text of "Secret armies; the new technique of Nazi warfare"




i 



Exposing Hitler s Undeclared War on the Americas 




The Book and the Author 

John L. Spivak comes closer to the popular conception 
of the ace journalist than any other living writer. Com 
bining the instinct of a detective with the resourceful 
ness of a reporter, and gifted with a hard-hitting, breezy 
style, he has time and again "scooped the world," 
"gotten the story" despite powerful opposition and 
personal danger that might well have daunted less 
hardy souls. 

But there is an important difference that sets Spivak 
apart from most other gentlemen of the press. For sev 
eral years he has devoted his bright and sharp pen solely 
to uncovering evidence of fascist activities in the United 
States evidence that is credited with having set off 
several official investigations exposing un-American, 
foreign-dominated propaganda. 

SECRET ARMIES climaxes Spivak s exposures. His sen 
sational inside story of Hitler s far-flung, under-cover 
poison campaign in the Americas would seem scarcely 
credible, were it not so thoroughly documented with 
original letters and records, citing chapter and verse, 
naming names, dates and places. His unanswerable, 
uncontradicted facts should go far toward jolting many 
of us out of our false sense of security. 



Books by John L. Spivak 

THE DEVIL S BRIGADE 
GEORGIA NIGGER 
AMERICA FACES THE BARRICADES 
EUROPE UNDER THE TERROR 



SECRET ARMIES 

The New Technique of Nazi War/ore 




JOHN L SPIVAK 



MODERN AGE BOOKS, INC. 
432 FOURTH AVENUE NEW YORK 



COPYRIGHT 1939 BY JOHN L. SPIVAK 

PUBLISHED BY MODERN AGE BOOKS, INC. 

432 Fourth Avenue 

New York City 



All rights in this book are reserved, and it may 
not be reproduced in whole or in part without 
written permission from the holder of these 
rights. For information address the publishers. 



First Printing, February 1939 
Second Printing, March 1939 



60 
Printed in the United States of America 



CONTENTS 

CHAPTER PACE 

Preface 7 

I Czechoslovakia Before the Carving 9 

II England s Cliveden Set 17 

III France s Secret Fascist Army 31 

IV Dynamite Under Mexico 43 

V Surrounding the Panama Canal 56 

VI Secret Agents Arrive in America 73 

VII Nazi Spies and American "Patriots" 84 

VIII Henry Ford and Secret Nazi Activities 102 

IX Nazi Agents in American Universities 118 

X Underground Armies in America 130 

XI The Dies Committee Suppresses Evidence 137 

XII Conclusion 155 



ILLUSTRATIONS 

PACE 

Application in the Secret Order of 76 by Sidney Brooks 77 

Letter from Harry A. Jung 82 

Anti-Semitic handbill 85 

Letter from Peter V. Armstrong 89 

Letter to Peter V. Armstrong 90 

Account card of Reverend Gerald B. Winrod 104 

Sample of "Capitol News & Feature Service" 106 

Letter from Wessington Springs Independent 107 

Letter from General Rodriguez Ill 

Letter from General Rodriguez 113 

Letter from Henry Allen 115 

Anti-Semitic sticker and German titlepage of book by Henry 

Ford 117 

Letter from Olov E. Tietzow 125 

Judgment showing conviction of E. F. Sullivan 138-139 

Letter from Carl G. Orgell 151 

Letter from G. Moshack 153 

Letter from E. A. Vennekohl .. , 154 



Preface 

THE MATERIAL IN THIS SMALL VOLUME just barely scratches the 
surface of a problem which is becoming increasingly grave: 
the activities of Nazi agents in the United States, Mexico, and 
Central America. During the past five years I have observed some 
of them, watching the original, crudely organized and directed 
propaganda machine develop, grow and leave an influence far 
wider than most people seem to realize. What at first appeared to 
be merely a distasteful attempt by Nazi Government officials at 
direct interference in the affairs of the American people and 
their Government, has now assumed the more sinister aspect of 
also seeking American naval and military secrets. 

Further studies in Central America, Mexico and the Panama 
Canal Zone disclosed an espionage network directed by the 
Rome-Berliri-Tokyo axis and operating against the peace and 
security of the United States. A scrutiny of the Nazi Fifth 
Column* in a few European countries, especially in Czechoslo 
vakia just before that Republic was turned over to Germany s 



* When the Spanish Insurgents were investing Madrid early in November, 
1936, newspaper correspondents asked Insurgent General Emilio Mola which 
of his four columns would take the city. Mola replied enigmatically: "The 
Fifth Column." He referred to the fascist sympathizers within Madrid those 
attempting to abet the defeat of the Spanish Government by means of spying, 
sabotage and terrorism. The term "Fifth Column" is today widely used to de 
scribe the various fascist and Nazi organizations operating within the borders 
of non-fascist nations. 



8 SECRET ARMIES 

mercy by the Munich "peace" and in France where Nazi and 
Italian agents built an amazing secret underground army, has 
made the fascist activities in the Western Hemisphere somewhat 
dearer to me. 

I have included one chapter detailing events which cannot, 
so far as I have been able to discover, be traced directly to Nazi 
espionage; but it shows the influence of Nazi ideology upon 
England s now notorious "Cliveden set," which maneuvered the 
betrayal of Austria, sacrificed Czechoslovakia and is working in 
devious ways to strengthen Hitler in Europe. The "Cliveden set" 
has already had so profound an effect upon the growth and in 
fluence of fascism throughout the world, that I thought it ad 
visable to include it. 

The sources for most of the material, by its very nature, 
naturally cannot be revealed. Those conversations which I quote 
directly came from people who were present when they occurred 
or, as in the case of the Cagoulards in France, from official 
records. In the chapter on Czechoslovakia I quote a conversation 
between a Nazi spy and his chief. The details came to me from 
a source which in the past I had found accurate. Subsequently, 
the spy was arrested by Czech secret police, and his confession 
substantiated the conversation as I have given it. 

Much of the material in this volume has been published in 
various periodicals from time to time, but so many Americans 
feel that concern over Nazi penetration in this country is exag 
gerated, that I hope even this brief and incomplete picture 
will serve to impress the reader, as it has impressed me, with 
the gravity of the situation. 

J. L. S. 



Czechoslovakia Before The Carving 

IT IS PRETTY GENERALLY ADMITTED ROW that the Munich "peace" 
gave Germany industrial and military areas essential to fur 
ther aggressions. Instead of helping to put a troubled Europe on 
the road to lasting peace, Munich strengthened the totalitarian 
powers, especially Germany, and a strengthened Germany in 
evitably means increased activities of the Nazis Fifth Column 
which is, in all quarters of the globe, actively preparing the 
ground for Hitler s greater plans. 

If we can divine the future by the past, the Fifth Column, 
that shadowy group of secret agents now entrenched in every 
important country throughout the world, is an omeri of what is 
to come. Before Germany marched into Austria, that unhappy 
country witnessed a large influx of Fifth Column members. In 
Czechoslovakia, especially in those months before the Republic s 
heart was handed to Hitler on a platter, there was a tremendous 
increase in the numbers and activities of agents sent into the 
Central European country. 

During my stay there in the brief period immediately pre 
ceding the "peace," I learned a little about the operations of the 
Gestapo s secret agents in Czechoslovakia. Their numbers are 
vast and those few of whom I learned, are infinitesimal to the 
actual numbers at work then and now, not only in Czechoslo 
vakia but in other countries. What I learned of those few, how- 



10 SECRET ARMIES 

ever, shows how the Gestapo, the Nazi secret service, operates 
in its ruthless drive. 

For years Hitler had laid plans to fight, if he had to, for 
Czechoslovakia, whose natural mountain barriers and man-made 
defensive line of steel and concrete stood in the way of his an 
nounced drive to the Ukrainian wheat fields. In preparation for 
the day when he might have to fight for its control, he sent into 
the Republic a host of spies, provocateurs, propagandists and 
saboteurs to establish themselves, make contacts, carry on propa 
ganda and build a machine which would be invaluable in time 
of war. 

In a few instances I learned the details of the Nazis inex 
orable determination and their inhuman indifference to the 
lives of even their own agents. 

Arno Oertel, alias Harald Half, was a thin, white-faced spy 
trained in two Gestapo schools for Fifth Column work. Oertel 
was given a German passport by Richter, the Gestapo district 
chief at Bischofswerda on what was then the Czechoslovak-Ger 
man frontier. 

"You will proceed to Prague," Richter instructed him, "and 
lose yourself in the city. As soon as it is safe, go to Langenau 
near Boehmisch-Leipa and report to Frau Anna Suchy.* She will 
give you further instructions." 

Oertel nodded. It was his first important espionage job as 
signed to him after the twenty-five-year-old secret agent had fin 
ished his intensive course in the special Gestapo training school 
in Zossen (Brandenburg), one of the many schools established 
by the Nazi secret service to train agents for various activities. 

After his graduation Oertel had been given minor practical 

* Frau Suchy was one of the most active members of Konrad Henlein s 
Deutscher Volksbund, a propaganda and espionage organization masquerading 
as a "cultural" body in the Sudeten area. She is today a leading official in 
the new German Sudetenland. 



CZECHOSLOVAKIA BEFORE THE CARVING 1 1 

training in politically disruptive work in anti-fascist organiza 
tions across the Czech border where he had posed as a German 
emigre\ There he had shown such aptitude that his Gestapo 
chief at sector headquarters in Dresden, Herr Geissler, sent him 
to Czechoslovakia on a special mission. 

Oertel hesitated. "Naturally I ll take all possible precautions 
but accidents may happen." 

Richter nodded. "If you are caught and arrested, demand to 
see the German Consul immediately," he said. "If you are in a 
bad predicament, we ll request your extradition on a criminal 
charge burglarly with arms, attempted murder some non-po 
litical crime. We ve got a treaty with Czechoslovakia to extradite 
Germans accused of criminal acts but" The Gestapo chief 
opened the top drawer of his desk and took a small capsule from 
a box. "If you find yourself in an utterly hopeless situation, 
swallow this." 

He handed the pellet to the nervous young man. 

"Cyanide," Richter said. "Tie it up in a knot in your hand 
kerchief. It will not be taken from you if you are arrested. There 
is always an opportunity while being searched to take it." 

Oertel tied the pellet in a corner of his handkerchief and 
placed it in his breast pocket. 

"You are to make two reports," Richter continued. "One for 
Frau Suchy, the other for the contact in Prague. She ll get you 
in touch with him." 

Anna Suchy, when Oertel reported to her, gave him specific 
orders: "On August 16 [1937], at five o clock in the afternoon, 
you will sit on a bench near the fountain in Karlsplatz in Prague. 
A man dressed in a gray suit, gray hat, with a blue handkerchief 
showing from the breast pocket of his coat, will ask you for a 
light for his cigarette. Give him the light and accept a cigarette 
from the gentleman. He will give you detailed instructions on 



12 SECRET ARMIES 

what to do and how to meet the Prague contact to whom in 
turn you will report." 

At the appointed hour Oertel sat on a bench staring at the 
fountain, watching men and women strolling and chatting cheer 
fully on the way to meet friends for late afternoon coffee. Occa 
sionally he looked at the afternoon papers lying on the bench 
beside him. He felt that he was being watched but he saw no 
one in a gray suit with a blue handkerchief. He wiped his fore 
head with his handkerchief, partly because of the heat, partly 
because of nervousness. As he held the handkerchief he could 
feel the tightly bound capsule. 

Precisely at five he noticed a man in a gray suit with a gray 
hat and a blue handkerchief in the breast pocket of his coat, 
strolling toward him. As the man approached he took out a 
package of cigarettes, selected one and searched his pockets for 
a light. Stopping before Oertel, he doffed his hat and smilingly 
asked for a light. Oertel produced his lighter and the other in 
turn offered him a cigarette. He sat down on the bench. 

"Report once a week," he said abruptly, puffing at his cigarette 
and staring at two children playing in the sunshine which flooded 
Karlsplatz. He stretched his feet like a man relaxing after a 
hard day s work. "Deliver reports to Frau Suchy personally. 
One week she will come to Prague, the next you go to her. De 
liver a copy of your report to the English missionary, Vicar 
Robert Smith, who lives at 31 Karlsplatz." 

Smith, to whom the unidentified man in the gray suit told 
Oertel to report, was a minister of the Church of Scotland in 
Prague, a British subject with influential connections not only 
with English-speaking people but with Czech government 
officials.* Besides his ministerial work, the Reverend Smith led 

* The Rev. Smith returned to England when he learned that the Czecho- 
slovakian secret police were watching him. At the present writing he had not 
returned to his church in Prague. 



CZECHOSLOVAKIA BEFORE THE CARVING 13 

an amateur orchestra group giving free concerts for German 
emigres. On his clerical recommendation, he got German "em 
igre" women into England as house servants for British govern 
ment officials and army officers. 

The far-flung Gestapo network in Czechoslovakia concen 
trated much of its activities along the former German-Czech bor 
der. In Prague, even today when Germany has achieved what 
she said was all she wanted in Europe, the network reaches into 
all branches of the Government, the military forces and emigre 
anti-fascist groups. The country, before it was cut to pieces and 
even now, is honeycombed with Gestapo agents sent from Ger 
many with false passports or smuggled across the border. 

Often the Gestapo uses Czech citizens whose relatives are in 
Germany and upon whom pressure is put. The work of these 
agents consists not only of ferreting out military information 
regarding Czech defense measures and establishing contacts with 
Czech citizens for permanent espionage, but of the equally im 
portant assignment of disrupting anti-fascist groups of creating 
opposition within organizations having large memberships in or 
der to split and disintegrate them. Agents also make reports 
on public opinion and attitudes, and record carefully the names 
and addresses of those engaged in anti-fascist work. A similar 
procedure was followed in Austria before that country was in 
vaded, and it enabled the Nazis to make wholesale arrests im 
mediately upon entering the country. 

Prague, with a German population of sixty thousand is still 
the headquarters for the astonishing espionage and propaganda 
machine which the Gestapo built throughout the country. Before 
Czechoslovakia was cut up, most of the espionage reports crossed 
the frontier into Germany through Tetschen-Bodenbach. The 
propaganda and espionage center of the Henlein group was in 
the headquarters of the Sudeten Deutsche Partei at 4 Hybernska 



14 SECRET ARMIES 

St. A secondary headquarters, in the Dcutscher Hilfsverein at 7 
Nekazanka St., was directed by Emil Wallner, who was ostensibly 
representing the Leipzig Fair but was actually the chief of the 
Gestapo machine in Prague. His assistant, Hermann Dorn, liv 
ing in Hanspaulka-Dejvice, masqueraded as the representative 
of the Muenchner Illustrierte Zeitung. 

Some aspects of the Nazi espionage and propaganda machine 
in Czechoslovakia hold especial interest for American immigra 
tion authorities since into the United States, too, comes a steady 
flow of the shadowy members of the Nazis Fifth Column. It is 
well to know that the letters and numbers at the top of pass 
ports inform German diplomatic representatives the world over 
that the bearer usually is a Gestapo agent. Whenever American 
immigration authorities find German passports with letters and 
numbers at the top, they may be reasonably sure that the bearer 
is an agent. These numbers are placed on passports by Gestapo 
headquarters in Berlin or Dresden. The agent s photograph and 
a sample of his (or her) handwriting is sent via the diplomatic 
pouch to the Nazi Embassy, Legation, Consulate or German 
Bund in the country or city to which the agent is assigned. When 
the agent reports in a foreign city, the resident Gestapo chief, 
in order to identify him, checks the passport s top number with 
the picture and the handwriting received by diplomatic pouch. 

Rudolf Walter Voigt, alias Walter Clas, alias Heinz Leonhard, 
alias Herbert Frank names which he used throughout Europe 
in his espionage work will serve as an illustration. Voigt was 
sent to Prague on a delicate mission. His job was to discover 
how Czechs got to Spain to fight in the International Brigade, 
a mystery in Berlin since such Czechs had to cross Italy, Germany 
or other fascist countries which cooperate with the Gestapo. 

Voigt was given passport No. 1,128,236 made out in the name 
of Walter Clas, and bearing at the top of the passport the letters 



CZECHOSLOVAKIA BEFORE THE CARVING 15 

and numbers i A 1444. He was instructed, by Leader Wilhelm 
May of Dresden, to report to the Henlein Party headquarters 
upon his arrival in Prague. Clas, alias Voigt, arrived October 23, 
1937, reported at the Sudeten Party headquarters and saw a man 
whom I was unable to identify. He was instructed to report 
again four days later, since information about the agent had not 
yet arrived. 

Voigt was trained in the Gestapo espionage schools in Potsdam 
and Calmuth-Remagen. He operates directly under Wilhelm 
May whose headquarters are in Dresden. May is in charge of Ges 
tapo work over Sector No. 2. Preceding the granting to Hitler of 
the Sudeten areas in Czechoslovakia, the entire Czech border 
espionage and terrorist activity was divided into sectors. At this 
writing the same sector divisions still exist, operating now across 
the new frontiers. Sector No. i embraces Silesia with headquar 
ters at Breslau; No. 2, Saxony, with headquarters at Dresden; 
and No. 3, Bavaria, with headquarters at Munich. After the an 
nexation of Austria, Sector No. 4 was added, commanded by 
Gestapo Chief Scheffler whose headquarters are in Berlin with a 
branch in Vienna. Sector No. 4 also directs Standarte II which 
stands ready to provide incidents to justify German invasion 
"because the situation has got out of control of the local 
authorities." 

Another way in which immigration authorities, especially in 
of antries surrounding Germany, can detect Gestapo agents is by 
the position of stamps on the German passport. Stamps are placed, 
in accordance with German law, directly under the spot provided 
for them on the passport on the front page, upper right hand 
corner. Whenever the stamps are on the cover facing the pass 
port title page, it is a sign to Gestapo representatives and Con 
sulates that the bearer is an agent who crossed the border hur 
riedly without time to get the regular numbers and letters from 



16 SECRET ARMIES 

Gestapo headquarters. The agent is given this means of tempo 
rary identification by the border Gestapo chief. 

Also, whenever immigration authorities find a German pass 
port issued to the bearer for less than five years and then ex 
tended to the regulation five-year period, they may be certain 
that the bearer is a new Gestapo agent who is being tested by 
controlled movements in a foreign country. For his first Gestapo 
mission in Holland, for instance, Voigt was given a passport 
August 15, 1936, good for only fourteen days. His chief was not 
sure whether or not Voigt had agreed to become an agent just to 
get a passport and money to escape the country; so his passport 
period was limited. 

When the fourteen-day period expired, Voigt would have to 
report to the Nazi Consulate for a renewal. In this particular 
instance, the passport was marked "Non-renewable Except by 
Special Permission of the Chief of Dresden Police." When Voigt 
performed his Holland mission successfully, he was given the 
usual five-year passport. 

Any German whose passport shows a given limited time, which 
has been subsequently extended, gives proof that he has been 
tested and found satisfactory by the Gestapo. 



II 

England s Cliveden Set 

THE WORK OF FOREIGN AGENTS does not necessarily involve the 
securing of military and naval secrets. Information of all 
kinds is important to an aggressor planning an invasion or esti 
mating a potential enemy s strength and morale; and often a 
diplomatic secret is worth far more than the choicest blueprint of 
a carefully guarded military device. 

There are persons whom money, social position, political prom 
ises or glory cannot interest in following a policy of benefit to a 
foreign power. In such instances, however, protection of class 
interests sometimes drives them to acts which can scarcely be dis 
tinguished from those of paid foreign agents. This is especially 
true of those whose financial interests are on an international 
scale and who consequently think internationally. 

Such class interests were involved in the betrayal of Austria 
to the Nazis only a few months before aggressor nations were 
invited to cut themselves a slice of Czechoslovakia; and it will 
probably never be known just how much the Nazis Fifth Col 
umn, working in dinner jackets and evening gowns, influenced 
the powerful personages involved to chart a course which sacri 
ficed a nation and a people and which foretold the Munich 
"peace" pact. 

The story begins when Neville Chamberlain, Prime Minister 
of England, accepted an invitation to spend the week-end of 

17 



18 SECRET ARMIES 

March 26-27, 1938, at Cliveden, Lord and Lady Astor s country 
estate at Taplow, Buckinghamshire, in the beautiful Thames 
Valley. When the Prime Minister and his wife arrived at the 
huge Georgian house rising out of a fairyland of gardens and 
forests with the placid river for a background, the other guests 
who had already arrived and their hosts were under the horse 
shoe stone staircase to receive them. 

The small but carefully selected group of guests had been in 
vited "to play charades" over the week-end a game in which 
the participants form opposing sides and act a certain part while 
the opponents try to guess what they are portraying. Every man 
invited held a strategic position in the British government, and 
it was during this "charades party" week-end that they secretly 
charted a course of British policy which will affect not only the 
fate of the British Empire but the course of world events and the 
lives of countless millions of people for years to come. 

This course, which indirectly menaces the peace and security 
of the United States, deliberately launched England on a series 
of maneuvers which made Hitler stronger and will inevitably 
lead Great Britain on the road to fascism. The British Parlia 
ment and the British people do not know of these decisions, 
some of which the Chamberlain government has already car 
ried out. 

And without a knowledge of what happened during the talks 
in those historic two days and what preceded them, the world 
can only puzzle over an almost incomprehensible British foreign 
policy. 

Present at this week-end gathering, besides the As tors and the 
Prime Minister and his wife, were the following: 

Sir Thomas Inskip, Minister for Defense. 

Sir Alexander Cadogan, who replaced Sir Robert Vansittart as 
adviser to the British Cabinet and who acts in a supervisory 



ENGLAND S CLIVEDEN SET 19 

capacity over the extraordinarily powerful British Intelligence 
Service. 

Geoffrey Dawson, editor of the London Times. 

Lord Lothian, Governor of the National Bank of Scotland, a 
determined advocate of refusing arms to the Spanish democratic 
government while Hitler and Mussolini supplied Franco with 
them. 

Tom Jones, adviser to former Premier Baldwin. 

The Right Honorable E. A. Fitzroy, Speaker of the House of 
Commons. 

The Baroness Mary Ravensdale, sister-in-law of Sir Oswald 
Mosley, leader of the British fascist movement. 

To understand the amazing game played by the Cliveden 
house guests, in which nations and peoples have already been 
shuffled about as pawns, one must remember that powerful Ger 
man industrialists and financiers like the Krupps and the Thys- 
sens supported Hitler primarily in order to crush the German 
trade-union and political movements which were in the late 
igao s threatening their wealth and power. 

The Astors are part of the same family in the United States. 
Lady Nancy Astor, born in Virginia, married into one of the 
richest families in England. Her interests and the interests of 
Viscount Astor, her husband, stretch into banking, railroads, life 
insurance and journalism. Half a dozen members of the family are 
in Parliament: Lady Astor, her husband, their son, in the House 
of Commons; and two relatives in the House of Lords. The Astor 
family controls two of the most powerful and influential news 
papers in the world, the London Times and the London Ob 
server. In the past these papers, whose influence cannot be ex 
aggerated, have been strong enough to make and break Prime 
Ministers. 

Cliveden House, ruled by the intensely energetic and ambitious 
American-born woman, had already left its mark upon current 



20 SECRET ARMIES 

history following other week-end parties. Lady Astor and her 
coterie had been playing a more or less minor role in the affairs 
of the largest empire in the world, but decisions recently reached 
at her week-end parties have already changed the map of Europe, 
after almost incredible intrigues, betrayals and double-crossings, 
carried through with the ruthlessness of a conquering Caesar and 
the boundless ambitions of a Napoleon. 

The week-ends at Cliveden House which culminated in the 
historic one of March 26-27, began in the fall of 1937. Lady 
Astor had been having teas with Lady Ravensdale and had en 
tertained von Ribbentrop, Nazi Ambassador to Great Britain, at 
her town house. Gradually the Astor-controlled London Times 
assumed a pro-Nazi bias on its very influential editorial page. 
When the Times wants to launch a campaign, its custom is to 
run a series of letters in its famous correspondence columns and 
then an editorial advocating the policy decided upon. During 
October, 1937, tne Times sprouted letters regarding Hitler s 
claims for the return of the colonies taken from Germany after 
the war. 

Rather than have Germany attack her, England preferred to 
see Hitler turn his eyes to the fertile Ukrainian wheat fields of 
the Soviet Union. It meant war, but that war seemed inevitable. 
If Russia won, England and her economic royalists would be 
faced with "the menace of communism." But if Germany won, 
she would expand eastward and, exhausted by the war, would 
be in no condition to make demands upon England. The part 
Great Britain s economic royalists had to play, then, was to 
strengthen Germany in her preparations for the coming war 
with Russia and at the same time prepare herself to fight if her 
calculations went wrong. 

Cabinet ministers Lord Hailsham (sugar and insurance inter 
ests), Lord Swinton (railroads, power, with subsidiaries in Ger 
many, Italy, etc.), Sir Samuel Hoare (real estate, insurance, etc.), 



ENGLAND S CLIVEDEN SET 21 

were felt out and thought it was a good idea. Chamberlain 
himself had a hefty interest (around twelve thousand shares) in 
Imperial Chemical Industries, affiliated with /. G. Farbenindus- 
trie, the German dye trust which is very actively supplying Hitler 
with war materials. The difficulty was Anthony Eden, British 
Foreign Minister, who was opposed to fascist aggressions because 
he feared they would eventually threaten the British Empire. 
Eden would certainly not approve of strengthening fascist coun 
tries and encouraging them to still greater aggressions. 

At one of the carefully selected little parties the Astors invited 
Eden. In the small drawing room banked with flowers the idea 
was broached about sending an emissary to talk the matter over 
with Hitler some genial, inoffensive person like Lord Halifax 
(huge land interests) for instance. Eden understood why the 
Times had suddenly raised the issue of the lost German colonies 
to an extent greater even than Hitler himself, and Eden em 
phatically expressed his disapproval. Such a step, he insisted, 
would encourage both Germany and Italy to further aggressions 
which would ultimately wreck the British Empire. 

Nevertheless, the cabinet ministers who had been consulted 
brought pressure upon Chamberlain and while the Foreign Sec 
retary was in Brussels on a state matter, the Prime Minister 
announced that Halifax would visit the Ftihrer. Eden was furi 
ous and after a stormy session tendered his resignation. At that 
period, however, Eden s resignation might have thrown England 
into a turmoil so Chamberlain mollified him. Public sympathy 
was with Eden and before he was eased out, the country had to 
be prepared for it. 

In the quiet and subdued atmosphere of the diplomats draw 
ing rooms in London they tell, with many a chuckle, how Lord 
Halifax, his bowler firmly on his head, was sent to Berlin and 
Berchtesgaden in mid-November, 1937, with instructions not to 
get into any arguments. Lord Halifax, in the mellow judgment 



22 SECRET ARMIES 

of his close friends, is one of the most amiable and charming 
of the British peers, earnest, well meaning and not particularly 
bright. 

In Berlin Halifax met Goering, attired for the occasion in a 
new and bewilderingly gaudy uniform. In the course of their 
conversation Goering, resting his hands on his enormous paunch, 
said: 

"The world cannot stand still. World conditions cannot be 
frozen just as they are forever. The world is subject to change/ 

"Of course not," Lord Halifax agreed amiably. "It s absurd to 
think that anything can be frozen and no changes made." 

"Germany cannot stand still," Goering continued. "Germany 
must expand. She must have Austria, Czechoslovakia and other 
countries she must have oil" 

Now this was a point for argument but the Messenger Ex 
traordinary had been instructed not to get into any arguments; 
so he nodded and in his best pacifying tone murmured, "Natur 
ally. No one expects Germany to stand still if she must expand." 

After Austria was invaded and Halifax was asked by his close 
friends what he had cooked up over there, he told the above 
story, expressing the fear that his conversation was probably 
misunderstood by Goering, the latter taking his amiability to 
mean that Great Britain approved Germany s plans to swallow 
Austria. The French Intelligence Service, however, has a different 
version, most of it collected during February, 1938, which, in the 
light of subsequent events, seems far more accurate. 

Lord Halifax, these secret-service reports state, pledged Eng 
land to a hands-off policy on Hitler s ambitions in Central 
Europe if Germany would not raise the question of the return 
of the colonies for six years. Within that period England esti 
mated that Hitler would have expanded, strengthened his war 
machine and fought the Soviet Union to a victorious conclusion. 

Late in January 1938, Lord and Lady As tor invited some 



ENGLAND S CLIVEDEN SET 23 

guests for a week-end at Cliveden. The Prime Minister of Eng 
land came and so did Lord Halifax, Lord Lothian, Tom Jones 
and J. L. Garvin, editor of the Astor-controlled London Observer. 
When Chamberlain returned to London, he asked Eden to open 
negotiations with Italy to secure a promise to stop killing British 
sailors and sinking British merchant vessels in the Mediterranean. 
During this time the British Foreign Office was issuing statements 
that Mussolini was "cooperating" in the hunt for the "unidenti 
fied" pirates. 

British opinion, roused by the sinking of English ships, might 
hamper deals with the fascist leaders if such attacks were not 
ended. In return for the cessation of the piratical attacks, Cham 
berlain was ready to offer recognition of Abyssinia and even 
loans to Italy to develop her captured territory. It was paying 
tribute to a pirate chieftain, but Chamberlain was ready to do 
it to quiet opposition at home to the sinking of British vessels 
and to give him time in which to develop his policy. 

Eden, who had fought for sanctions against the aggressor when 
Abyssinia was invaded, obeyed orders but insisted that Italy must 
first get her soldiers out of Spain. He did not want Mussolini 
to get a stranglehold upon Gibraltar, one of the strategic life 
lines of the British Empire. Mussolini refused and told the 
British Ambassador in Rome that he and Great Britain would 
never to able to get together because Eden insisted on the with 
drawal of Italian troops from Spain, and that it might help if 
a different Foreign Secretary were appointed. Hitler, working 
closely with Mussolini in the Rome-Berlin axis, also began to 
press for a different Foreign Secretary but went Mussolini one 
better. Von Ribbentrop informed Chamberlain that Der Fiihrer 
was displeased with the English press attacks upon him, Nazis 
and Nazi aggressions. Der Fiihrer wanted that stopped. 

The Foreign Office of the once proud and still biggest empire 
in the world promptly sent notes to the newspapers in Fleet 



24 SECRET ARMIES 

Street requesting that stories about Nazis and Hitler be toned 
down "to aid the government," and most of the once proud and 
independent British newspapers established a "voluntary cen 
sorship" at what amounted to an order from Hitler relayed 
through England s Foreign Office. The explanation the news 
papers gave to their staffs was that the world situation was too 
critical to refuse the government s request and, besides that 
refusal would probably mean losing routine Foreign Office and 
other government department news sources. The more than 
average British citizen doesn t know even today how his govern 
ment and "independent" press took orders from Hitler. 

In the latter part of January, 1938, the French Intelligence 
Service, still not knowing of the secret deal Halifax had made, 
learned that Hitler intended to invade Austria late in February 
and that simultaneously both Italy and Germany, instead of 
withdrawing troops as they had said they would, planned to 
intensify their offensive in Spain. When the French Intelligence 
learned of it, M. Delbos, then French Foreign Minister, and 
Eden were in Geneva attending a meeting of the Council of the 
League. Delbos excitedly informed Eden who, never dreaming 
that Great Britain had not only agreed to sacrifice Austria and 
betray France but was also double-crossing her own Foreign 
Minister, telephoned Chamberlain from Geneva. 

The Prime Minister listened attentively, thanked him dryly, 
hung up, and promptly telephoned Sir Eric Phipps, British Am 
bassador to France. Sir Eric was instructed to get hold of M. 
Chautemps, the French Premier at the time, and ask that Chau- 
temps instruct Delbos to stop frightening the British Foreign 
Secretary. But all during February the French Intelligence kept 
getting more information about the planned invasion of Austria 
and the proposed intensified offensive in Spain, and relayed it to 
England with insistent suggestions for joint precautions. Eden 
in turn relayed it to Chamberlain who always thanked him. 



ENGLAND S CLIVEDEN SET 



25 



The date set for the invasion was approaching but Eden was 
still in office and Hitler began to fear that perhaps "perfidious 
Albion" with all her overtures of friendship might really be 
double-crossing Germany. If England could send a special emis 
sary to offer to sell out Austria and double-cross her ally France, 
she might be quite capable of tricking Germany. Simultaneously 
the Gestapo stumbled upon information that the British Intel 
ligence had reached into the top ranks of the German Army and 
was working with high officers. Hitler, not knowing how far the 
British Intelligence had penetrated, shook up his cabinet, made 
Ribbentrop Secretary for Foreign Affairs, and prepared for war 
in the event that England was leading him into a trap. 

There are records in the British Foreign Office which show 
that Hitler, before invading Austria, tested England to be sure 
he wasn t being led into a trap. Von Ribbentrop informed Eden 
and Chamberlain that Hitler intended to summon Schuschnigg, 
the Austrian Chancellor, and demand that Austria rearrange her 
cabinet, take in Dr. Seyss-Inquart and release imprisoned Nazis. 
Hitler knew that Schuschnigg would immediately rush to Eng 
land and France for aid. If they turned Austria down it was 
safe to proceed with the invasion. 

The British Foreign Office records show that Schuschnigg did 
rush to England and France for support, that France was ready 
to give it, but that England refused, thereby forcing France to 
keep out of it. 

While these frantic maneuvers were going on, the Astor-con- 
trolled Times and Observer, the Nazi and the Italian press simul 
taneously started a campaign against Eden. The date set for the 
sacrifice of Austria was approaching and Eden had to go or it 
might fail. The public, however, was with Eden; so another kind 
of attack was launched. Stories began to appear about the For 
eign Secretary s health. There were sighs, long faces, sad regrets, 
but Eden stuck to his post in the hope that he could do some- 



26 SECRET ARMIES 

thing. On February 19, Hitler, tired of waiting, bluntly de 
manded that he be removed, and with the newspaper campaign 
in full swing, Chamberlain "in response to public opinion" 
removed him the very next day. 

The amiable Lord Halifax was appointed Foreign Secretary. 
Pro-fascists like A. L. Lennon-Boyd, stanch supporter of Franco 
and admirer of Hitler and Mussolini, were given ministerial 
posts. 

The Austrian invasion was delayed for three weeks because of 
the difficulty in getting Eden out. When the news flashed to a 
startled world that Nazi troops were thundering into a country 
whose independence Hitler had promised to respect, M. Corbin, 
the still unsuspecting French Ambassador, rushed to the Foreign 
Office to arrange for swift joint action. This was at four o clock 
in the afternoon of March 11, 1938. Instead of receiving him 
immediately, Lord Halifax kept him waiting until nine o clock 
in the evening. By that time Austria was Nazi territory. There 
was nothing to do but protest; so Lord Halifax, with a straight 
face, joined France in a "strong protest." It was not until a 
week after Austria had been absorbed that the French Intelli 
gence Service learned the details of the Halifax deal and finally 
understood why England had side-stepped the pleas for joint 
action and why the French Ambassador had been kept cooling his 
heels until the occupation of Austria was completed. 

From Austria Hitler got more men for his army, large deposits 
of magnesite, timber forests and enormous water-power resources 
for electricity. From Czechoslovakia, if he could get it, Hitler 
would have the Skoda armament works, one of the biggest in 
the world, factories in the Sudeten area, be next door to Hun 
garian wheat and Rumanian oil, dominate the Balkans, destroy 
potential Russian air and troop bases in Central Europe, and 
place Nazi troops within a few miles of the Soviet border and the 
Ukrainian wheat fields he has eyed so long. 



ENGLAND S CLIVEDEN SET 27 

Five days after Austria was invaded, on March 16, at 3:30 
in the afternoon, Lord Halifax personally summoned the Czecho- 
slovakian Minister. At four o clock the Minister came out of 
the conference with a dazed and bewildered air. Lord Halifax 
had made some "suggestions." Revealing complete ignorance of 
what had happened and was happening in Czechoslovakian 
politics, Halifax was nevertheless laying down the law. 

It was obvious that the British Foreign Secretary was getting 
orders from someone else, for Halifax suggested that the Central 
European Republic try to conciliate Germany (which it had 
been doing for months) and that a German be taken into the 
cabinet (there were already three in it) . On March 22 there was 
another meeting at which the Minister learned that Halifax 
wanted the Czech Government to take a Nazi into the cabinet 
as Austria took Dr. Seyss-Inquart at Hitler s orders. 

This pressure from England for Czechoslovakian Nazis to be 
given more power in the government was virtually telling the 
beleaguered little democracy to fashion a strong rope and hang 
itself. Subsequent events showed that Chamberlain personally 
supplied the rope. 

Then came the historic week-end of March 26-27, 1938. 

The walls of the small drawing room at -Cliveden House are 
lined with shelves filled with books. The laughing and chatting 
guests had gathered there after a delightful dinner. For the 
Prime Minister of England to go through all sorts of contortions 
in a game of charades might prove a trifle undignified; so the 
hostess suggested that they play "musical chairs." 

Everyone thought it was a splendid idea and men servants in 
their impressive blue liveries arranged the chairs in the required 
order, carefully spacing the distances between them. One of the 
laughing and bejeweled women took her place at the piano. In 
"musical chairs" there is one person more than the number of 
chairs. When the music starts the players march around the 



28 SECRET ARMIES 

chairs. The moment the music stops everyone dives for the near 
est chair leaving the extra person standing and subject to the hil 
arious jibes of the other players and those rooting from the 
bleachers. It s one of the ways statesmen relax. 

The music started and the dour Prime Minister of the greatest 
empire in the world, the Minister in charge of the Empire s de 
fense measures, the editor of England s most powerful newspaper, 
the Right Honorable Speaker of the House of Commons, the 
sister-in-law of England s leading fascist and several others started 
marching while the piano tinkled its challenging tune. The Prime 
Minister, perhaps because he is essentially conservative, marched 
cautiously and stepped quickly between the spaces while Lady 
Astor eyed him shrewdly and the others suppressed giggles. The 
Prime Minister tried to maintain at least the dignity of his bank 
ing background but managed "to look only a little porky" as 
one expressed it afterward. Suddenly the music stopped. Every 
one lunged for the nearest chair. The Prime Minister managed 
to get one and plopped into it heavily. 

After half an hour or so some of the strategic rulers of Great 
Britain got a little winded and quit. A conversation started on 
foreign affairs and most of the wives retired to another room. 
When the discussion was ended the little Cliveden house party 
had come to six major decisions which will change the face of 
the world if successfully carried through. 

Those decisions (maneuvers to put some of them into effect 
have already begun) are: 

1. To inform France that England will go to her aid if she 
is attacked, unless the attack results from a treaty obligation 
with another power. 

2. To introduce peace time conscription in England. 

3. To appoint three ministers to coordinate industrial defense 
(conscription in peace time); supervise military conscription; and, 



ENGLAND S CLIVEDEN SET 29 

coordinate the "political education of the people" (propaganda). 

4. To reach an agreement with Italy to preserve the legitimate 
interest of both countries in the Mediterranean. 

5. To discuss mutual problems with Germany. 

6. To express the hope to Germany that her methods of self- 
assertion be such as will not hinder mutual discussions by arous 
ing British public opinion against her. 

The two most important decisions in this plan are the one for 
the conscription of labor in peace time and the effort to force 
France to break the Franco-Soviet pact by choosing between Eng 
land and Russia. 

Consider conscription first and the motives behind it: 

When any country whose workers are strongly organized starts 
veering towards fascism, it must either win over the trade-unions 
in one way or another or destroy them, for rebellious labor can 
prevent fascism by means of the general strike. British labor is 
known to hate fascism since it has learned that fascism destroys, 
among other things, the value of the trade-unions and all that 
they have gained after many years of struggle. Any veering by 
England toward fascism and fascist alliances spells trouble with 
the trade-unions; hence, the decision "to coordinate the political 
education of the people." This move is particularly necessary 
since some trade-union leaders, especially in the important arma 
ment industry, have already stated publicly that unless the work 
ers were given assurances that the arms labor was manufacturing 
would be used in defense of democracy and not to destroy it, 
they would not cooperate. 

Hence "the education of the people" and the conscription of 
labor in peace time which would ultimately lead to government 
control over the unions. With some variations it is the same 
procedure followed by Hitler in getting control of the once 
extremely powerful German trade-unions. 

A few days after this historic week-end, the Times came out 



SO SECRET ARMIES 

for "national organization" and the wisdom of "national regis 
tration." National registration, as the history of fascist countries 
has shown, is the first step in the conscription of labor. With this 
opening gun having been fired, it is a safe prophecy that if the 
Chamberlain government remains in office British labor will 
witness one of the most determined attacks ever made upon it 
in its history. All indications point to the ground being laid and 
it may result in splitting the trade-union movement, for some of 
the leaders are willing to go with the government while others 
have already indicated that they will refuse unless they know 
that it s for democracy and not for fascism. 

The second important decision is to exert pressure upon France 
to break her pact with the Soviet Union something Hitler has 
been unsuccessfully trying to accomplish for a long time. At the 
moment it appears that Great Britain will succeed just as she 
has already succeeded in breaking the Czechoslovakian-Soviet 
pact another rupture Hitler was determined upon. 

England has a reputation for shrewd diplomacy. In the past 
she has used nations and peoples, played one against the other, 
betrayed, sacrificed, double-crossed in the march of her empire. 
Since the Cliveden week-end, however, with its resultant in 
trigues, England has, to all appearances, finally double-crossed 
herself. 

Those who guide her destiny and the destinies of her millions 
of subjects have apparently come to the conclusion that democ 
racy, as England has known it, cannot survive and that it is a 
choice between fascism and communism. Under communism, 
the ruling class to which the Cliveden week-end guests belong, 
stand to lose their wealth and power. It is the fatuous hope of the 
economic royalists that under fascism they will still sit on top of 
the roost, and so the Cliveden week-enders move toward fascism. 

Hitler s Fifth Column finds strange allies. 



Ill 

France s Secret Fascist Army 

NEITHER HITLER nor Mussolini could have foreseen the devel 
opment of a Cliveden set or England s willingness to weaken 
her own position as the dominant European power by sacrificing 
Austria and a good portion of Czechoslovakia. The totalitarian 
powers proceeded on the assumption that when the struggle for 
control of central Europe, the Balkans and the Mediterranean 
came they would have to fight. 

The Rome-Berlin axis reasoned logically that if, when the ex 
pected war broke out, France could be disrupted by a wide 
spread internal rebellion, not only would she be weakened on 
the battlefield but fascism might even be victorious in the Re 
public. In preparation for this, the axis sent into France secret 
agents plentifully supplied with money and arms, and almost 
succeeded in one of the most amazing plots in history. 

The opening scene of events which led directly to the discovery 
of how far the foreign secret agents had progressed took place in 
the Restaurant Drouant on the Place Gaillon which is frequented 
by leaders of Paris financial, industrial and cultural life. 

Precisely at noon, on September 10, 1937, Jacqueline Blondet, 
an eighteen-year-old stenographer with marcelled hair, sparkling 
eyes, and heavily rouged lips, passed through the rotating doors 
of the famous restaurant and turned right as she had been in- 

31 



32 SECRET ARMIES 

structed. She had never been in so luxurious a place before- 
dining rooms done in gray or brown marble with furniture to 
match. Two steps lead from the gray to the brown room and 
Mile. Blondet, not noticing them in her excitement, slipped and 
would have fallen had not the old wine steward who looks like 
Charles Dickens, caught and steadied her. 

The two men with whom she was lunching were at a table at 
the far corner of the deserted room. The one who had invited 
her, Francois Metenier, a well-known French engineer and in 
dustrialist, powerfully built, with sharp eyes, dark hair, and a 
suave self-assured manner, rose at her approach, smiling at her 
embarrassment. The other man, considerably younger, was M. 
Locuty, a stocky, bushy haired man with square jaws and heavy 
tortoise-shell eyeglasses. He was an engineer at the huge Miche- 
lin Tire Works at Clermont-Ferrand where Metenier was an im 
portant official. The industrialist introduced the girl merely as 
"my friend" without mentioning her name. 

With the exception of two couples having a late breakfast in 
the gray marble room, which they could see from their table, the 
three were alone. 

"Shall we have a bottle of Bordeaux?" asked Metenier. "I or 
dered lunch by phone but I thought I would await your presence 
on the wine." 

"Oh, anything you order," said Locuty with an effort at casual- 
ness. 

"Yes, you order the wine," said the stenographer. 

"Garfon, a bottle of St. Julien, Chateau Leoville-Poyferre 
1870." 

The ghost of Charles Dickens, who had been hovering nearby, 
bowed and smiled with appreciation of the guest s knowledge of a 
rare fine wine and personally rushed off to the cellars for the 
Bordeaux. 

When the early lunch was over and the brandy had been set 



FRANCE S SECRET FASCIST ARMY 33 

before them, Metenier studied his glass thoughtfully and glanced 
at the two portly men who had entered the brown dining room 
and sat some tables away. From the snatches of conversation 
the three gathered that one was a literary critic and the other a 
publisher. They were discussing a thrilling detective story just 
published which the critic insisted was too fantastic. 

Metenier said to Locuty: 

"You will have to make two bombs. I will take you to a very 
important man in our organization, a power in France. He will 
personally give you the material and show you how to make them. 
Then I will take you to the places where you will leave them. I 
do not want them to see me." 

In low tones, they discussed the bombing of two places. Me 
tenier, a pillar of the church, highly respected in his community 
and well-known throughout France, cautioned them as they left. 

Why the vivacious blond stenographer was permitted to sit in 
on this conversation, Locuty did not know, unless it was to tempt 
him, for, as she bade him good-by, she squeezed his hand sig 
nificantly and said she wanted to see him again. 

Metenier drove Locuty to an office building where he intro 
duced him to a man he called "Leon" actually Alfred Macon, 
concierge of a building which Metenier and others used as head 
quarters for their activities. Within a few moments the door of 
an adjacent room opened and Jean Adolphe Moreau de la Meuse, 
aristocrat and leading French industrialist, came in. He had a 
monocle in his right eye which he kept adjusting nervously. His 
face was deeply marked and lined with heavy bluish pouches 
under the eyes. With a swift glance he sized up Locuty as 
Metenier rose. 

"This is the gentleman whom I mentioned," he said. 

"He understands his mission?" De la Meuse asked. 

"Yes," said Locuty. "You will teach me how to make them?" 

De la Meuse nodded. "It will be a time bomb which must 



34 SECRET ARMIES 

be set for ten o clock tomorrow night. There will be nobody in 
the building at that time, so no one will be hurt." 

An hour later Locuty, who had made both bombs and set the 
timing devices, wrapped them into two neat packages. Metenier 
took him to the General Confederation of French Employers 
Building in the Rue de Presbourg. In accordance with instruc 
tions he left one of the packages with the concierge, after which 
Metenier took him to the Ironmasters Association headquarters 
on the Rue Boissiere, where Locuty left the second package. 

On the evening of September 11, the General Confederation 
of French Employers was scheduled to hold a meeting in their 
building. This meeting was postponed; and, as De la Meuse had 
assured the Michelin engineer, the concierges and their wives, 
contrary to custom, were not in their buildings that evening. 

At ten o clock, both bombs exploded. The plans had gone off 
as arranged except for an accident, the investigation of which 
made public the whole amazing conspiracy. Two French gen 
darmes standing near one of the buildings were killed. 

Immediately after the bombs exploded, the Employers Con 
federation and the Ironmasters Association issued statements 
charging the Communists and the Popular Front with being 
responsible for the outrages and accusing them of planning a 
reign of terror to seize control of France. The accusations left 
a profound effect upon the French people despite the Communists 
assertions that they never countenance terrorism. The Surete 
Nationale, the French Scotland Yard, opened an intensive in 
vestigation which was spurred on by the deaths of the unfortunate 
gendarmes. It was not long before the French people heard of 
the almost incredibly fantastic plot to destroy the Popular Front 
and establish fascism in France a plot directed by leading French 
industrialists and high army officers cooperating with secret agents 
of the German and Italian Governments. 

The ramifications of the plot are so packed with dynamite in 



FRANCE S SECRET FASCIST ARMY 35 

the national and international arena that the French government, 
under pressure from England as well as from some of its own 
industrialists, government officials and army officers, has clamped 
the lid down on further disclosures lest continued publicity seri 
ously affect the delicate balance of international relations. 

It was obvious from what the police uncovered that it had 
taken several years to organize the gigantic conspiracy. Within the 
teeming city of Paris itself, steel and concrete fortresses had been 
secretly built. Other cities throughout France were similarly 
ringed in strategic places. Every one of these secret fortresses was 
stocked with arms and munitions, and throughout the country, 
once the confessions began, the police found thousands upon 
thousands of rifles and pistols, millions of cartridges, hundreds 
of machine guns and sub-machine guns. The fortresses them 
selves were fitted with secret radio and telephone stations for 
communication among themselves. Code books and evidence of 
arms-running from Germany and Italy were found. A vast es 
pionage network and a series of murders were traced to this 
secret organization whose official name is the "Secret Committee 
for Revolutionary Action." At their meetings they wore hoods 
to conceal their identity from one another, like the Black Legion 
in the United States, and the press promptly named them the 
"Cagoulards" ("Hooded Ones") . 

Just how many members the Cagoulards actually have is un 
known except to its Supreme Council and probably to the Ger 
man and Italian Intelligence Divisions. Lists of names totaling 
eighteen thousand men were turned up by the Surete Nationale, 
and the hundreds of steel and concrete fortresses and the arms 
found in them point to a membership of at least 100,000. The 
way the fortresses were built and their strategic locations (blow 
ing down the walls of the buildings where the fortresses were 
hidden would have given them command of streets, squares and 



36 SECRET ARMIES 

government buildings) indicate supervision by high military 
officials. 

When contractors buy enormous quantities of cement for dug 
outs, when butchers and bakers lorries rattle over ancient cob 
blestones with enormous loads of arms smuggled across German 
and Italian borders, when thousands of people are drilled and 
trained in pistol, rifle and machine-gun practice, it is impossible 
that the competent French Intelligence Service and the Surete 
Nationale should not get wind of it. 

As far back as September, 1936, the Surete Nationale knew 
that some leading French industrialists with the cooperation of 
the German and Italian Governments were building a military 
fascist organization within France. Nevertheless it quietly per 
mitted fortresses to be built and stocked with munitions. The 
General Staff of the French Army, from reports of Intelligence 
men in Germany and Italy, knew that those countries were 
smuggling arms into France, but they permitted it to go on. The 
General Staff knew that some eight hundred concrete fortresses 
were being built under the supervision of M. Anceaux, a build 
ing contractor of Dieppe, and that skilled members of the Secret 
Committee for Revolutionary Action had been recruited for the 
building and sworn to secrecy under penalty of death. They 
knew that these fortresses were equipped with sending and re 
ceiving radios, knew that some were within the shadow of mili 
tary centers, knew that the Cagoulards had a far-flung espionage 
system. But the French General Staff made no effort to stop it. 

The Popular Front Government was in power at the time, 
and heads of the Supreme War Council apparently preferred a 
fascist France to a democratic one. In fact, officers and reserve 
officers of the French Army cooperated with secret agents of their 
traditional enemy, Germany, to build up this formidable secret 
army. 

The investigating authorities, stunned by their discoveries and 



FRANCE S SECRET FASCIST ARMY 37 

the high officials and individuals to whom their investigations 
led, either did not dare go further with it, or, if they did, sup 
pressed the information. Some of it, however, came out. 

At the top of the Cagoulards is a Supreme War Council or 
General Staff whose members have not been disclosed. Working 
with them are several other organizations, all with innocent 
names, as for example the "Society of Studies for French Re 
generation." The Cagoulards activities are divided into broad 
general lines, each directed by an individual in complete com 
mand and embracing: 

Buying war materials within France and smuggling war ma 
terials into the country from Germany, Italy and Insurgent Spain, 
along with the simultaneous weaving of an espionage network 
under Nazi and fascist direction and leadership. 

Building concrete fortresses at strategic centers and storing 
smuggled arms in them. 

Military training of secretly organized troops. 

Getting the money to carry on these extensive activities. 

Extreme care was, and still is, taken to conceal the identities 
of the ordinary members and especially the leaders. For instance, 
one of the leaders known to his subordinates as "Fontaine" is in 
reality Georges Cachier, director of a large company in Paris 
and chief of the Cagoulards "Third Bureau," which is in charge 
of military movements. Cachier is an Officer of the French Le 
gion of Honor and a reserve Lieutenant-Colonel in the French 
Army. 

The Cagoulards are still very active. Members are being re 
cruited with leaders pointing out to the fearful ones that there 
is nothing to worry about almost all of those arrested in the 
early days of the investigation are free, out on bail or kept in a 
"gentleman s confinement" where they can do virtually as they 
please. "Our power is great," new members are told. 

As is customary in secret terrorist societies, the members are 



38 SECRET ARMIES 

sworn to silence with death as the penalty for indiscretion. The 
penalty when it is employed is usually administered in American 
gangster fashion. Each member is allotted to a "cell," the basic 
unit of the military organization, and assigned to a secretly for 
tified post for training. One of these posts discovered by the 
Surete Nationale was in an old boarding house run by two 
ancient spinsters with equally ancient guests who spent their 
time in rockers, knitting and reading and not dreaming that 
underneath the porch on which they sat so tranquilly was a for 
tress with enough explosives to blow the whole street to smith 
ereens. Into this particular fortification, the cell members would 
steal one by one after the old maids had retired, entering by a 
concealed door three feet thick and electrically operated. 

There are two different kinds of cells in the Cagoulards, 
"heavy" and "light" ones. They differ in the number of men and 
the quantity of armaments assigned to them. The "light" cell has 
eight men equipped with army rifles, automatics, hand grenades, 
and one sub-machine gun; the "heavy" one has twelve men simi 
larly armed but with a machine gun instead of a sub-machine 
gun. Three cells form a unit, three units a battalion, three bat 
talions a regiment, two regiments a brigade and two brigades 
a division of two thousand men. The battalions (one hundred 
and fifty men) are subdivided into squads of fifty to sixty men 
with ten to twelve cars at their disposal for quick movement 
throughout the city. These automobile squads are given intensive 
training. 

Members are not required to pay dues, for enough money 
comes in from industrialists and the German and Italian Govern 
ments to eliminate the need of collecting money from members 
for operating expenses. Every effort is made to function without 
written communications. No membership cards are issued. No 
tices of meetings, drill and rifle practice are issued verbally, and 



FRANCE S SECRET FASCIST ARMY 39 

so far as the mass membership is concerned, nothing in writing 
is placed in their hands. 

A twenty-page handbook with instructions on street fighting 
was issued to group commanders and, lest a copy fall into wrong 
hands and betray the organization, it was boldly entitled: Secret 
Rules of the Communist Party. The instructions are specific and 
are based upon the insurrectionary tactics issued to the Nazi 
Storm Troopers. They fall into six sections: General Remarks; 
Group Fighting; Section Fighting; Choice of Terrain; Commis 
sariat; and Policing Groups. 

One or two excerpts from these instructions for street fighting 
follow: 

"The particular force for street fighting is infantry, provided 
with automatic weapons and hand grenades. Members of the 
detachments should be instructed that automatic weapons must 
always be used in preference. Essential arms are: sub-machine 
guns, rifles including hunting rifles, hand grenades, revolvers, 
petards." (Petards are small bombs used for blowing in doors.) 

With regard to "mopping up" in houses, the instructions state: 

"If the door is barricaded, it must be opened with tools or 
explosives. If it is a heavy door, break it in by driving a lorry 
at it. Clean up basements and cellars by throwing bombs down 
through the air holes or other openings after your men have got 
into the house. Only after these have exploded should the cellar 
doors be forced. Then, when ascending the stairs, keep close to 
the walls while one of your men keeps firing straight up the 
shaft. Mop up as you go down floor by floor. If necessary, pierce 
holes in the ceilings and mop up by throwing down hand 
grenades." 

The chief of the Cagoulards espionage system is Dr. Jean 
Marie Martin, a bushy-haired stocky man with dark, somber 
eyes. Dr. Martin usually travels with several false passports and 
with the utmost secrecy. At the moment he is in Genoa where he 



40 SECRET ARMIES 

went to meet Commendatore Boccalaro, Mussolini s personal 
representative in charge of smuggling arms into foreign countries. 

The preparations by the Rome-Berlin axis point to plans for a 
fight to a finish between fascist and non-fascist countries. A 
feeble or disrupted democracy will obviously strengthen the 
fascist powers in any coming struggle with anti-fascist powers. 
Germany and Italy, faced on their own borders with a demo 
cratic France allied with the Soviet Union in a military defense 
pact, would face a powerful enemy in the event of war. But if 
France were torn by a bloody civil war, she would be virtually 
unable even to defend her borders. Consequently, it is essential 
for Germany and Italy to weaken and if possible destroy France s 
democracy. 

France and Germany have been traditional enemies in their 
struggle for land containing raw materials needed by their in 
dustries to compete in the world markets. But the growth of the 
French labor movement and the power of the Popular Front 
which threatened the control and the profits of French industrial 
ists and financiers, made them find more in common with fascist 
and Nazi industrialists than with French workers who menaced 
their economic and political control. The result was that leading 
French industrialists were willing to cooperate with Nazi and 
fascist agents to destroy the Popular Front and establish fascism 
in France. About half of the 200,000,000 francs, which it is es 
timated the fortresses and arms cost, was contributed by French 
industrialists. The other half came from the German and Italian 
Governments. 

Germany and Italy sent swarms of secret agents into France to 
supervise the building of the underground military machine 
and to carry on intensive espionage with the assistance of the 
French Army and Government officials who were members of the 
Hooded Ones. The espionage service was organized by Baron 
de Potters, an old international spy who travels with two or more 



FRANCE S SECRET FASCIST ARMY 41 

passports under the names of Farmer and Meihert. De Potters 
gets his funds from the Nazis strongly guarded "Bureau III B," 
established in Berne, Switzerland at 21 Gewerbestrasse. "Bureau 
III B" is the official name of this branch of the Gestapo. At the 
head of it is Boris Toedli whose activities include not only 
espionage but underground diplomatic intrigue and propaganda. 
He works directly under Drs. Rosenberg and Goebbels. Toedli 
supplies not only the Baron but other espionage directors with 
money and there is plenty of it at his disposal for quick emer 
gency uses. The money is deposited in the Societe des Banques 
Suisses, account No. 60941. 

The head of the Italian espionage system directing the work 
in France and cooperating closely with the Nazis is Commenda- 
tore Boccalaro, head of the Italian Government s Arsenal in 
Genoa. One of his specialties is the smuggling of arms into for 
eign countries. 

Boccalaro s history shows that the not so fine Italian hand 
is interfering in the internal affairs of foreign governments. As 
far back as 1928, he secretly supplied carloads of arms from the 
Genoa Arsenal to Hungary, and in 1936 he supplied Yugoslavian 
terrorists with war materials in efforts to get those countries 
under Mussolini s sphere of influence. Boccalaro, too, seems to 
have had reasons to suppress information in at least one case 
where the death penalty was inflicted upon a member of the 
Cagoulards. 

Among the Hooded Ones who have been found with bullets 
or knives in them was an arms runner named Adolphe-Augustin 
Juif, who tried to charge the secret organization a little more 
than he should for smuggling guns and munitions into France. 
When the organization threatened him, he advised it not to resort 
to threats because he knew a little too much. 

On February 8, 1937, his bullet-riddled body was found in 



42 SECRET ARMIES 

San Remo, Italy. When Juif s wife, not hearing from him, sought 
information about his whereabouts, she wrote to Boccalaro, since 
she knew he was working with the Genoa director. The Italian 
papers had announced the finding of his body; nevertheless, on 
March 3, Boccalaro wrote to the murdered man s widow: 

"Your husband, my dear friend, is carrying on a special and 
delicate mission (perhaps in Spain or Germany) and has special 
reasons of a delicate nature not to inform even his own family 
where he is at the present moment." 

Among the men whom Juif met before he was murdered was 
Eugene Deloncle, director of the Maritime and River Transport 
Mortgage Company and one of the most important industrialists 
in France. Deloncle, a high official in the Cagoulards, used the 
name of "Grosset" in his conspiratorial activities. The other man 
whom the murdered Juif met is General Edouard Arthur Du- 
seigneur, former Air Force chief and Military Adviser to the 
French Air Ministry. The General is one of the military heads of 
the Cagoulards and frequently met with Baron de Potters. 

The Surete Nationale, the French Intelligence Service, and the 
examining magistrate have documentary evidence that Germany 
and Italy were and are deliberately conspiring to throw France, 
as they did Spain, into a civil war. Publication of these docu 
ments would have far-reaching effects, internally and externally. 
Great Britain, however, planning to establish a four-cornered pact 
between England, France, Germany and Italy, brought pressure 
to bear upon France to suppress further disclosures about the 
Cagoulards. To England s pressure was added that of leading 
French industrialists, financiers, government and army officials. 
Gradually, news about the Cagoulards is dying out. The real 
heads of the Hooded Ones either have not been named or, if 
arrested in the early days of the investigation, have been released 
on bail. And recruiting for the underground army is still going on. 



IV 

Dynamite Under Mexico 

MOST PEOPLE IN THE UNITED STATES feel secure from European 
or Asiatic aggression since wide oceans apparently separate 
us from the conquering ambitions of a Fuhrer or a Son of the 
Sun. However, despite our desire to be left in peace, the Rome- 
Berlin axis, which Japan joined, has cast longing eyes upon the 
Western Hemisphere. The Monroe Doctrine is of value only so 
long as aggressor nations feel we are too strong for them to 
violate it; recent history has shown what pieces of paper are 
worth. 

In the process of trying to get a foothold in the Americas, the 
Nazis have sent agents into all of the countries, but because most 
of the Central and South American republics are still resentful 
of past acts by the "Colossus of the North," they offer the most 
fertile fields. 

The two spots on the Western Hemisphere most vital to the 
United States are the Panama Canal Zone and Mexico the Zone 
because it is our trade and naval life line between the oceans 
and Mexico because potential enemies could find in it perfect 
military and naval bases. 

Let us see what the totalitarian powers are doing in Mexico: 

On June 30, 1937, the S.S. "Panuco" of the New York and 
Cuba Mail Steamship Co. steamed into Tampico, Mexico, from 

43 



44 SECRET ARMIES 

New York with a mysterious cargo consigned to one Armeria 
Estrada. As soon as she docked, the cargo was quickly trans 
ferred to the Atchison, Topeka and Santa Fe Railroad freight 
car No. 45169, which was awaiting it. A gentleman known 
around the freight yards as A. M. Cabezut, arranged for the car 
to leave immediately for the state of San Luis Potosi in the 
heart of Mexico. 

There was no record on the bill of lading to show that the 
shipper was the Winchester Repeating Arms Company of New 
Haven, Conn., and that the cargo, ordered on January 23 and 
February 23, 1937, by an Italian named Benito Estrada, was a 
large quantity of rifles, pistols and one hundred and forty cases 
of cartridges for various caliber guns. 

When the car arrived in San Luis Potosi, it was met by an 
elderly, mustached German named Baron Ernst von Merck, who 
took the shipment to General Saturnino Cedillo, former gov 
ernor of the state* and a well-known advocate of fascism. One 
week later the elderly German met a carload shipment of "farm 
implements." When it was unloaded in San Luis Potosi, the farm 
implements turned out to be dynamite. 

Von Merck, who has been Cedillo s right-hand man, was dur 
ing the World War a German spy stationed in Brussels. A mem 
ber of Cedillo s stafff he traveled constantly between San Luis 
Potosi, where the arms were cached, and the Nazi Legation in 
Mexico City. 

On December 21, 1937, Baron von Merck flew to Guatemala 
the same day that a cargo of arms from Germany was to be 
landed off the wild jungle coast of Campeche in Southern 
Mexico. 

* In May, 1938, Cedillo launched an abortive rebellion and is now being 
hunted by the Mexican government. 

t After Cedillo s defeat von Merck fled to New York and went to Germany. 



DYNAMITE UNDER MEXICO 45 

Guatemala, just south of Mexico, is the most thoroughly or 
ganized fascist country in Central or South America. Its chief 
industries, coffee and bananas, are virtually controlled by Ger 
mans, whose enormous plantations overlap into the state of 
Chiapas, Mexico. But President Jorge Ubico, who is not much 
of an Aryan, prefers Mussolini s brand of fascism because the 
Nazi theory of Nordic supremacy does not strike a sympathetic 
chord in the President s heart. As a result, the Italian Minister 
to Guatemala is Ubico s adviser on almost all matters of state. 

Guiseppe Sotanis, a mysterious Italian officer who sits in 
the Gran Hotel in San Jose", Costa Rica, collecting stamps and 
studying his immaculate fingernails, arranges for shipments of 
Italian arms into Guatemala. A few months ago Sotanis, the 
Italian minister to Guatemala, and Ubico met in Guatemala 
City. Shortly thereafter the Italian arms manufacturing company, 
Bredda, sent Ubico two hundred eighty portable machine guns, 
sixty anti-aircraft machine guns and seventy small caliber cannon. 

But President Ubico is not hopelessly addicted to one brand 
of fascism. Nazi ships make no attempt to conceal their landing 
of arms and munitions at Puerto Barrios. From there they are 
transported by car, river and horse into the dense chicle forests 
in the mountain regions, then across the Guatemalan border into 
Chiapas and Campeche. 

During March, 1938, mysterious activities took place in the 
heart of the chicle forests in Campeche. The region is a dense 
jungle inhabited by primitive Indian tribes. There is little 
reason for anyone to build an airport in this territory, much of 
which has not even been explored. But if the Mexican Govern 
ment will instruct its air squadron to go to Campeche and fly 
forty miles north of the Rio Hondo and a little west of Quin- 
tana Roo border, they will find a completed airport in the heart 
of the chicle jungle; and if they will fly a little due west of the 



46 SECRET ARMIES 

small villages of La Tuxpena and Esperanza in Campeche, they 
will find two more secret airports. 

The Mexican Government knows that arms are being smuggled 
in through its own ports, across the Guatemalan border, and 
across the wide, sparsely inhabited two-thousand-mile stretch of 
American border. Both American and Mexican border patrols 
have been increased, but it is almost impossible to watch the 
entire region between Southern California and Brownsville. Few 
contraband runners are caught, apparently because neither the 
American nor Mexican Governments seem to know the routes 
followed or who the leading smugglers are. 

On February 12, 1938, Jos Rebey and his brother Pablo, who 
live in the Altar district of Sonora and know every foot of the 
desert, drove to Tucson, Arizona, where they met two unidenti 
fied Americans. On February 16, 1938, Jose Rebey and Fran 
cisco Cuen, old and close friends of Gov. Roman Yocupicio, 
drove a Buick to the sandy, deserted wastes near Sonoyta, just 
south of the American border where one of the two unidentified 
Americans delivered a carload of cases securely covered with sheet 
metal. As soon as the cases were transferred into Rebey s car, he 
turned back on Sonera s flat, dusty roads, passing Caborca, La 
Cienega, and turning on the sun-dried rutted road to Ures, which 
lies parched and dry in the semi-tropical sun. 

Ures is the central cache for arms smuggled into Sonora by 
Yocupicio, and the Rebey brothers and Cuen are among the 
chief contraband runners. The load they carried that day con 
sisted of Thompson guns and cartridges, and the route followed 
is the one they generally use. A secondary route used by one of 
Cuen s chief aids, a police delegate from the El Tiro mine, lies 
over the roads to Ures by way of Altar. 

If in time of war it becomes necessary for guard or patrol work 
to deflect any troops from the army, or ships from the navy, it is 



DYNAMITE UNDER MEXICO 47 

of advantage to the enemy. If a coming war found the United 
States lined up with the democratic as against the fascist powers 
and serious uprisings broke out in Mexico, it would require 
several U. S. regiments to patrol the border and a number of 
U. S. ships to watch the thousands of miles of coast line to 
prevent arms running to American countries sympathetic to the 
Berlin-Rome-Tokyo axis. 

The three fascist powers that have cast longing eyes upon Cen 
tral and South America have apparently divided their activities 
in the Americas, with Japan concentrating on the coast lines and 
the Panama Canal, Germany on the large Central and South 
American countries and Italy upon the small ones. 

In Mexico, Nazi agents work directly with Mexican fascist 
groups, and have undertaken to carry the brunt of spreading 
anti-democratic propaganda to turn popular sentiment against 
the "Colossus of the North," and to develop a receptive attitude 
toward the totalitarian form of government. 

Italy concentrates on espionage, with particular attention to 
Mexican aid to Loyalist Spain. It was the Italian espionage net 
work in Mexico which learned the course of the ill-fated "Mar 
Cantabrico" which left New York and Vera Cruz with a cargo 
of arms for the Loyalists and was intercepted and sunk by an 
Insurgent cruiser. 

Though Germany, even more than Italy, is utilizing her propa 
ganda machine in the Americas markets, the Japanese are not 
troubling about that just yet. Their commercial missions seem 
to be much less interested in establishing business connections 
than in taking photographs. The chief commercial activity all 
three countries are intensely interested in is getting concessions 
from Mexico for iron, manganese and oil materials essential for 
war. President Lazaro Cardenas, however, has stated his dislike 
of fascism on several occasions. Since Germany, Japan and Italy 



48 SECRET ARMIES 

must obtain these products wherever they can get them, it would 
be to their advantage if a government more friendly to fascism 
were in power. But, should that prove impossible, the existence 
of a strong, fascist movement would have, in time of war, tre 
mendous potentialities for sabotage. 

Hence, Mexico is today being battered by pro-fascist propagan 
da broadcasts from Germany on special short-wave beams, and 
Nazi and fascist agents surreptitiously meet with discontented 
generals to weave a network throughout the country. 

The radio propaganda is devoted chiefly to selling the wonders 
of totalitarian government, and to the dissemination of subtle, 
indirect comments calculated to turn popular feeling against the 
United States. In addition to regular broadcasts, material printed 
in Spanish and in German by the Fichte Bund with headquarters 
in Hamburg, Germany, is smuggled into Mexico in commercial 
shipments. A Nazi bund to direct this propaganda was organ 
ized secretly because of the government s unfriendly attitude 
toward fascism. The bund operates as the Deutsche Volksgemein- 
schaft and its propaganda center functions under the name of 
the "United German Charities." This organization, on the top 
floor of the building at 80 Uruguay Street, Mexico City, is 
actually the "Brown House," in direct contact with Nazi propa 
ganda headquarters in Hamburg. 

Some of the propaganda distributed in Mexico is smuggled 
off Nazi ships docking in Los Angeles, and is transported across 
the American border by agents working under Hermann Schwinn, 
director of Nazi activities for the West Coast of the United 
States. The propaganda sent by Schwinn across the American 
border is chiefly for distribution around Guaymas, where a spe 
cial effort is being made to win the sympathy of the people. 
Meanwhile Yocupicio caches arms in Ures and the bland Jap 
anese continue charting the harbors and coast lines. 



DYNAMITE UNDER MEXICO 49 

The Nazis began to build fascism in Mexico right after Hitler 
got into power. In 1933 Schwinn called a meeting in Mexicali 
of several Nazi agents operating out of Los Angeles, including 
General Rodriguez, and several members of a veterans organi 
zation. It was at this meeting that the Mexican Gold shirts were 
organized. Under the direction of Rodriguez and his right-hand 
men (Antonio F. Escobar was one of them) , the fascist organi 
zation drilled and paraded, but little official attention was paid 
to them. Five years ago few people realized the intensity and 
possibilities of Nazi propaganda and organization. The only ones 
in Mexico who watched the growth of the fascist military body 
were the trade-unionists and the Communists. They remembered 
what happened in Italy and Germany when the Black Shirts and 
the Brown Shirts were permitted to grow strong. 

On November 20, 1935, Rodriguez and his organization 
staged a military demonstration in Mexico City, and marched 
upon the President s palace. Trade-unionists, liberals and Com 
munists barred their way. When the pitched battle was over, five 
Gold Shirts were dead, some sixty persons wounded, and Rod 
riguez himself had been stabbed by a woman worker, on her 
lips the furious cry, "Down with fascism!" 

When the Gold Shirt leader was discharged from the hospital, 
he found that his organization had been made illegal, and he 
himself exiled. Rodriguez went to El Paso, Texas, and im 
mediately, working through Escobar, set about establishing the 
"Confederation of the Middle Class" to take over now the illegal 
Gold Shirt work and consolidate the various Mexican fascist 
groups. Its headquarters was established at 40 Passo de la 
Reforma. 

Rodriguez kept in touch with Schwinn through Henry Allen, 
a native American of San Diego, who acts as liaison man. It was 
Allen, on orders from Schwinn, who last year secretly met in 
Guaymas Ramon F. Iturbe, a member of the Mexican Chamber 



50 SECRET ARMIES 

of Deputies. Iturbe is in constant touch with the fascist groups 
in Mexico City. 

The Gold Shirts smuggled arms into Mexico along the border 
between Laredo and Brownsville, and cached them in Monterrey. 
On January 31, 1938, Gold Shirts attempted to attack Matamoros, 
near Brownsville. A Mexican policeman was killed and another 
wounded in the fighting. Two days later Gold Shirts surrounded 
Reynosa, some distance west of Matamoros, but met peasants 
armed with rifles, pistols and knives. The fascists withdrew 
and Rodriguez vanished, only to appear in San Diego, California, 
on February 19, 1938 for a secret meeting with Plutarco Elias 
Calles, the former President of Mexico. After a three-hour con 
ference Rodriguez went to Los Angeles, met Schwinn, and pro 
ceeded to Mission, Texas, where he established new headquarters. 

A few days after these conferences, he sent two men into Mexico 
under forged passports to discuss closer cooperation among the 
fascist leaders. The men sent into Mexico were an American 
named Mario Baldwin, one of Rodriguez s chief assistants, and 
a Mexican named Sanchez Yanez. They established headquarters 
at 31 Jose" Joaquin Herrera, apartment i-T, and met for their 
secret conferences in Jesus de Avila s tailor shop at 22 Isabel la 
Catolico, 

In the latter part of June, 1935, an amiable bar fly arrived in 
Mexico City from Berlin as civilian attache" to the German Lega 
tion. A civilian attache is the lowest grade in the diplomatic 
ranks and the salary is just about enough to keep him going. 
Nevertheless, Dr. Heinrich Northe, at that time not quite thirty, 
and not especially well-to-do, established a somewhat luxurious 
place at 64 Tokyo St. and bought a private airplane for "pleas 
ure jaunts" about Mexico. Northe is seldom at the Nazi Lega 
tion. He is more apt to be found in Sonora, where Yocupicio 
is storing arms and where the Japanese fishing fleet is active, or 



DYNAMITE UNDER MEXICO 51 

in Acapulco, whose harbor fascinates the Japanese. He used to 
make frequent visits to Cedillo just before the General started 
his rebellion. On March 4, 1938, Northe took off "for a vacation" 
in the Panama Canal Zone. He stopped off in Guatemala on 
the way down. 

The persistently vacationing commercial attache, before com 
ing to Mexico, was part of the Gestapo network in Moscow and 
Bulgaria. Immediately after the Nazis got control of Germany, 
Northe went into the German "diplomatic service," and was one 
of the first secret agents sent to the German Embassy in Moscow. 
The Russian secret service apparently watched him a little too 
closely, for he was shifted to Sofia, Bulgaria, where he bought a 
private plane and flew wherever he wished. In 1935, when the 
signers of the "anti-Communist pact" decided to concentrate 
upon Mexico, Northe was transferred to Mexico City. 

One of Northe s chief aids is a German adventurer who was a 
spy during the World War. When the War ended, Hans Hein- 
rich von Holleuffer, of 36 Danubio St., Mexico City, worked hard 
at earning a dishonest penny in Republican Germany. When the 
law got after him, he skipped to Mexico, where, without even 
pausing for breath, he went to work on his fellow countrymen 
in the New World. Berlin asked for his arrest and extradition v 
and von Holleuffer fled to Guatemala. That was in 1926. He 
came back to Mexico in 1931 under the name of Hans Helbing. 

When Hitler got into power von Holleuffer s brother-in-law 
became a high official in the Gestapo. Since there was no danger 
of the Nazis extraditing him on charges of fraud and forgery, 
Hans Helbing became Hans Heinrich von Holleuffer again and, 
without any visible means of support, established a swanky resi 
dence at the above address, got an expensive automobile, a 
chauffeur, and some very good-looking maids. Since he has not 
defrauded anyone lately, the German colony in Mexico still 
wonders how he does it. 



52 SECRET ARMIES 

He does it by being in charge of arms smuggling from Ger 
many to Mexican fascists. During the latter part of December, 
1937, ne directed the unloading of one of the heaviest cargoes 
of arms yet shipped into Mexico. Northe had informed von 
Holleuffer that a German vessel whose name even Northe had 
not yet been given, would be ready to land a cargo of guns, 
munitions and mountain artillery somewhere along the wild 
and deserted coast of Campeche where there are miles of shore 
with not even an Indian around. Von Holleuffer was instructed 
to arrange for unloading the cargo and having it removed into 
the interior. 

On December 19, 1937, von Holleuffer arranged a meeting in 
Mexico City with Julio Rosenberg of 13 San Juan de Letran and 
Curt Kaiser at 34 Bolivar, the latter s home. He offered them 
fifty thousand pesos to take the contraband off the boat and 
transport it through the chicle jungles to the destination he 
would give them. 

Shortly after the Japanese-Nazi pact was signed, the Japanese 
Government arranged with the somewhat naive Mexican Govern 
ment for Japanese fishing experts to conduct "scientific explora 
tions" along Mexico s Pacific Coast in return for teaching Mexi 
cans how to catch fish scientifically. The agreement provided that 
two Japanese, J. Yamashito and Y. Matsui, be employed by the 
Mexican Government for the exploratory work. 

Matsui arrived in Mexico in 1936 and immediately became 
interested in the fish situation at Acapulco, which from a naval 
standpoint has the best harbor on the entire long stretch of 
Mexico s Pacific coast line. In February, 1938, he decided that 
it was important to the west-coast shrimp-fishing studies for him 
to do some exploratory work along the northeast part of the 
Mexican coast, near the American border, and there he went. 

Immediately after the agreement was signed, three magnificent 



DYNAMITE UNDER MEXICO 53 

fishing boats, the "Minatu Maru," the "Minowa Mam" and the 
"Saro Maru," which had been hovering out on the Pacific while 
the negotiations were going on, appeared in Guaymas. Their 
captains reported to the Nippon Suisan Kaisha, a fishing com 
pany with headquarters in Guaymas. Eighty per cent of this 
company s stock is owned by the Japanese Government. 

Each ship is equipped with large fish bins which can easily 
be turned into munition carriers, each has powerful short-wave 
sending and receiving sets; and each has extraordinarily long 
cruising powers ranging from three to six thousand miles. These 
boats do not do much fishing. They confine themselves to "ex 
ploring," which Includes the taking of soundings of harbors, 
especially Magdalena Bay. Apparently the explorers want to 
know how deep the fish can swim and whether there are any 
rocks or ledges in their way. 

That Germany, Japan and Italy are not working toward peace 
ful ends in Mexico is slowly dawning upon the Mexican Govern 
ment. Influential government and trade-union leaders have re 
peatedly shown their dislike of Nazism and fascism and have 
urged propaganda against them. 

On the morning of October 5, 1937, Freiherr Riedt von Col- 
lenberg, Nazi minister to Mexico, telephoned the Japanese and 
Italian ministers to suggest a joint meeting to discuss steps to 
counteract the attacks on fascism and their countries. The Jap 
anese minister, Sacchiro Koshda, suave and skilled in such 
matters, thought it would not be wise to meet in any of the 
legations. The Italian minister suggested the offices of the Italian 
Union on San Cosne Avenue. 

At half past one in the afternoon of October 7, the ministers 
arrived, each in a taxi instead of the legation car which carries 
a conspicuous diplomatic license plate. At this secret meeting 



54 SECRET ARMIES 

which lasted until after four, they concluded that it would be 
unwise for them personally to take any steps to counteract the 
anti-fascist activities that it would be wiser to work indirectly 
through fascist organizations like the Confederation of the 
Middle Class and its associated bodies. A few days earlier each 
minister had received a letter from several organizations allied 
with the Confederation of the Middle Class. It was an offer 
to help the Berlin-Tokyo-Rome combination. A free translation 
of the passage which the ministers discussed (from the letter 
received by the Japanese minister which I now have) follows: 

"We, exactly like the representatives of the three powers, love 
our Fatherland and are disposed to any sacrifice to prevent the 
intervention of these elements [Jews and Communists] in our 
politics, in which, unfortunately, they have begun to have great 
influence. And we will employ, and are employing, all legal 
methods of struggle to make an end of them." 

The phrase "legal methods" is frequently employed by those 
who suggest illegal activity. The German Minister knew that 
the Union Nacionalista Mexicana, one of the signers of the letter, 
was run by Escobar, and that Carmen Calero, 12 Place de la 
Concepcion, Mexico City, an elderly woman physician active in 
many fascist organizations, was a member of the Partido Anti- 
reelectionista Action, another of the signers. 

One month later the various fascist groups got enough money 
to launch an intensive pro-fascist drive under the usual guise of 
fighting Communism. Jose" Luis Noriega, Secretary of the Na 
tionalist Youth of Mexico, which also signed the letters to the 
ministers, left for the United States to organize an anti-Cardenas 
drive. At the same time, Carmen Calero left on a mysterious 
mission to Puebla on November 12, 1937, with a letter from 
Escobar to J. Trinidad Mata, publisher of the local paper 
Avance. She carried still another letter addressed to their "dis 
tinguished comrades," without mentioning names, and signed by 



DYNAMITE UNDER MEXICO 55 

both Escobar and Ovidio Pedfero Valenzuela, President of the 
Action Civica Nationalists The "distinguished comrades" to 
whom she presented the letter were the Nazi honorary consul 
in Puebla, Carl Petersen, Avenida 2, Oriente 15, and a Japanese 
agent named L. Yuzinratsa with whom the consul has been in 
repeated conferences. 

Six weeks after the secret meeting of the Japanese, German 
and Italian ministers, and one week after she went to Puebla, 
Dr. Carmen Calero got twenty-two kilos of dynamite and stored 
it in a house at 39 Juan de la Mateos, in Mexico City. She, her 
sister, Colonel Valenzuela, and four others, met at her home and 
laid plans to assassinate President Cdrdenas by blowing up his 
train when he left on a proposed trip to Sonora. 

On November 18, 1937, the secret police made a series of 
simultaneous raids upon Dr. Calero s and Valenzuela s homes and 
the house where the dynamite was cached. They arrested every 
one in the houses. But once the arrests had been made, the 
Mexican Government found itself in a quandary. To bring the 
prisoners to trial would involve foreign governments and create 
an international scandal; so Cardenas personally ordered the 
secret police to release them. 

The arrests, however, scared the wits out of the ministers, and 
their horror was not lessened when they discovered that the 
letters from the fascist organizations had vanished from their 
files. They wouldn t even answer the telephone when one of the 
released fascist leaders called. It was then that the Mexican fas 
cists decided to send a special messenger to Francisco Franco in 
Spain (November 30, 1937) with the request that Franco inter 
cede to get money from Hitler to help overthrow Cardenas, 
since the Nazi minister was too scared to cooperate. The special 
messenger was Fernando Ostos Mora. He never got there. 



Surrounding the Panama Canal 

r-piHERE is A LITTLE SHIRT SHOP in Colon, Panama, on Calle loa 
JL between Avenida Herrera and Avenida Amador Guerrero, 
whose red and black painted shingle announces that Lola Osawa 
is the proprietor. 

Across the street from her shirt shop, where the red light dis 
trict begins, is a bar frequented by natives, soldiers and sailors. 
Tourists seldom go there, for it is a bit off the beaten track. In 
front of the bar is a West Indian boy with a tripod and camera 
with a telescopic lens. He never photographs natives, and wan 
dering tourists pass him by, but he is there every day from eight 
in the morning until dark. His job is to photograph everyone 
who shows an undue interest in the little shirt shop and particu 
larly anyone who enters or leaves it. Usually he snaps your pic 
ture from across the street, but if he misses you he darts across 
and waits to take another shot when you come out. 

I saw him take my picture when I entered the store. It was 
almost high noon and Lola was not yet up. The business upon 
which she and her husband are supposed to depend for a living 
was in the hands of two giggling young Panamanian girls who 
sat idly at two ancient Singer sewing machines. 

"You got shirts?" I asked. 

Without troubling to rise and wait on me, they pointed to a 
glass case stretched across the room and barring quick entrance 

56 



SURROUNDING THE PANAMA CANAL 57 

to the shop proper. I examined the assortment in the case, count 
ing a total of twenty-eight shirts. 

"I don t especially like these," I said. "Got any others?" 

"No more," one of them giggled. 

"Where s Lola?" 

"Upstairs," the other said, motioning with her thumb to the 
ceiling. 

"Looks like you re doing a rushing business, eh?" They looked 
puzzled and I explained: "Busy, eh?" 

"Busy? No. No busy." 

There is little work for them and neither Lola nor they care 
a whoop whether or not you buy any of the shop s stock of 
twenty-eight shirts. Lola herself pays little attention to the busi 
ness from which she obviously cannot earn enough to pay the 
rent, let alone keep herself and her husband, pay two girls and a 
lookout. 

The little shirt shop is a cubbyhole about nine feet square, 
its wooden walls painted a pale, washed-out blue. A deck which 
cuts the store s height in half, forms a little balcony which is 
covered by a green and yellow print curtain stretched across it. 
To the right, casually covered by another print curtain, is a red 
painted ladder by which the deck is reached. On the deck, at 
the extreme left, where it is not perceptible from the street or 
the shop, is another tiny ladder which reaches to the ceiling. 

If you stand on the ladder and press against the ceiling di 
rectly over it, a well-oiled trap door will open soundlessly and 
lead you into Lola s bedroom above the shop. In front of the 
window with the blue curtain is a worn bed, the hard mattress 
neatly covered with a counterpane. At the head of the mattress 
is a mended tear. It is in this mattress that Lola hides photo 
graphs of extraordinary military and naval importance. I saw 
four of them. 

The charming little seamstress is one of the most capable of the 



58 SECRET ARMIES 

Japanese espionage agents operating in the Canal Zone area. 
Lola Osawa is not her right name. She is Chiyo Morasawa, who 
arrived at Balboa from Yokahama on the Japanese steamship 
"Anyo Maru" on May 24, 1929, and promptly disappeared for 
almost a year. When she appeared again, she was Lola Osawa, 
seamstress. She has been an active Japanese agent for almost 
ten years, specializing in getting photographs of military im 
portance. Her husband, who entered Panama without a Pana 
manian visa on his passport, is a reserve officer in the Japanese 
Navy. He lives with Lola in the room above the shop, never 
does any work though he passes as a merchant, and is always 
wandering around with a camera. Occasionally he vanishes to 
Japan. His last trip was in 1935. At that time he stayed there 
over a year. 

To defend the ten-mile-wide and forty-six-mile-long strip of 
land, lakes and canal which the Republic of Panama leased to 
the United States "in perpetuity," the army, navy and air corps 
have woven a network of secret fortifications, laid mines and 
placed anti-aircraft guns. Foreign spies and international ad 
venturers play a sleepless game to learn these military and naval 
secrets. The Isthmus is a center of intrigue, plotting, conniving, 
conspiracy and espionage, with the intelligence departments of 
foreign governments bidding high for information. For the cap 
ture or disablement of the Canal by an enemy would mean that 
American ships would have to go around the Horn to get from 
one coast to another a delay which in time of war might prove 
to be the difference between victory and defeat. 

Because of the efficiency and speed of modern communication 
and transportation, any region within five hundred to a thousand 
miles of a military objective is considered in the "sensitive zone," 
especially if it is of great strategic importance. Hence, espionage 
activities embrace Central and South American Republics which 



SURROUNDING THE PANAMA CANAL 59 

may have to be used by an enemy as a base of operations. Costa 
Rica, north of the Canal, and Colombia, south of it, are beehives 
of secret Japanese, Nazi and Italian activities. Special efforts are 
made to buy or lease land "for colonization," but the land chosen 
is such that it can be turned into an air base almost overnight. 

For decades Japanese in the Canal Zone area have been photo 
graphing everything in sight, not only around the Canal, but for 
hundreds of miles north and south of it; and the Japanese fish 
ing fleet has taken soundings of the waters and harbors along 
the coast. Since the conclusion of the Japanese-Nazi "anti-Com 
munist pact," Nazi agents have been sent to German colonies 
in Central and South America to organize them, carry on propa 
ganda and cooperate secretly with Japanese agents. Italy, which 
had been only mildly interested in Central America, has become 
extremely active in cultivating the friendship of Central Ameri 
can Republics since she joined the Tokyo-Berlin tie-up. Let me 
illustrate: 

The recognized vulnerability of the Canal has caused the 
United States to plan another through Nicaragua. The friendship 
of the Nicaraguan Government and people, therefore, is of great 
importance to us from both a commercial and a military stand 
point. It is likewise of importance to others. 

Italy undertook to gain Nicaragua s friendship when she joined 
the Japanese-Nazi line-up. First, she offered scholarships, with 
all expenses paid, for Nicaraguan students to study fascism in 
Italy. Then, on December 14, 1937, about one month after a 
secret Nazi agent arrived in Central America with orders to 
step on the propaganda and organizational activity, the Italian 
S.S. "Leme" sailed out of Naples with a cargo of guns, armored 
cars, mountain artillery, machine guns and a considerable amount 
of munitions. 

On January 11, 1938, the Secretary of the Italian Legation in 
San Jos<, Costa Rica, flew to Managua, Nicaragua, to witness 



60 SECRET ARMIES 

the delivery of arms which arrived in Managua on January 12, 
1938. Diplomatic representatives do not usually witness purely 
business transactions, but this was a shipment worth $300,000 
which the Italian Government knew Nicaragua could not pay. 
But, as one of the results, Italy today has a firm foothold in the 
country through which the United States hopes to build another 
Canal. The international espionage underground world, which 
knew that the shipment of arms was coming, has it that Japan, 
Germany and Italy split the cost of the arms among themselves 
to gain the friendship of the Nicaraguan Government. 

A flood of Nazi propaganda sent on short-wave beams is 
directed at Central and South America from Germany. In 
Spanish, German, Portuguese and English, regular programs are 
sent across at government expense. Government subsidized news 
agencies flood the newspapers with "news dispatches" which they 
sell at a nominal price or give away. The programs and the 
"news dispatches" explain and glorify the totalitarian form of 
government, and since many of the sister "republics" are dicta 
torships, they are ideologically sympathetic and receptive. 

The Nazis are strong in Colombia, south of the Canal, with a 
Bund training regularly in military maneuvers at Cali. Since the 
Japanese-Nazi pact, the Japanese have established a colony of 
several hundred at Corinto in the Cauca Valley, thirty miles 
from Cali. 

The Japanese colony was settled on land carefully chosen- 
long, level, flat acres which overnight can be turned into an air 
base for a fleet landed from an airplane carrier or assembled on 
the spot. And it is near Cali that Alejandro Tujun, a Japanese 
in constant touch with the Japanese Foreign Office, is at this 
writing dickering for the purchase of 400,000 acres of level land 
for "colonization." On such an acreage enough military men 
could be colonized to give the United States a first-class headache 
in time of war. It is two hours flying time from Cali to the Canal. 



SURROUNDING THE PANAMA CANAL 61 

The entrances on either side of the Panama Canal are secretly 
mined. The location of these mines is one of the most carefully 
guarded secrets of the American navy and one of the most sought 
after by international spies. 

The Japanese, who have been fishing along the West Coast and 
Panamanian waters for years, are the only fishermen who find it 
necessary to use sounding lines to catch fish. Sounding lines are 
used to measure the depths of the waters and to locate sub 
merged ledges and covered rocks in this once mountainous area. 
Any fleet which plans to approach the Canal or use harbors 
even within several hundred miles north or south of the Canal 
must have this information to know just where to go and how 
near to shore they can approach before sending out landing 
parties. 

The use of sounding lines by Japanese fishermen and the mys 
terious going and comings of their boats became so pronounced 
that the Panamanian Government could not ignore them. It 
issued a decree prohibiting all aliens from fishing in Panamanian 
waters. 

In April, 1937, the "Taiyo Maru," flying the American flag 
but manned by Japanese, hauled up her anchor in the dead of 
night and with all lights out chugged from the unrestricted waters 
into the area where the mines are generally believed to be laid. 
The "Taiyo" operated out of San Diego, California, and once 
established a world s record of being one hundred and eleven 
days at sea without catching a single fish. The captain, piloting 
the boat from previous general knowledge of the waters rather 
than by chart, unfortunately ran aground. The fishing vessel 
was stranded on a submerged ledge and couldn t get off. 

In the morning the authorities found her, took off her captain 
and crew all of whom had cameras and asked why the boat 
was in restricted waters. 



62 SECRET ARMIES 

"I didn t know where I was," said the captain. "We were 
fishing for bait." 

"But bait is caught in the daytime by all other fishermen," 
the officials pointed out. 

"We thought we might catch some at night," the captain ex 
plained. 

Since 1934, when rumors of the Japanese-Nazi pact began to 
circulate throughout the world, the Japanese have made several 
attempts to get a foothold right at the entrance to the Canal on 
the Pacific side. They have moved heaven and earth for per 
mission to establish a refrigeration plant on Taboga Island, some 
twelve miles out on the Pacific Ocean and facing the Canal. 
Taboga Island would make a perfect base from which to study the 
waters and fortifications along the coast and the islands between 
the Canal and Taboga. 

When this and other efforts failed and there was talk of ban 
ning alien fishing in Panamanian waters, Yoshitaro Amano, who 
runs a store in Panama and has far flung interests all along the 
Pacific coasts of Central and South America, organized the 
Amano Fisheries, Ltd. In July, 1937, he built in Japan the 
"Amano Maru," as luxurious a fishing boat as ever sailed the 
seas. With a purring diesel engine, it has the longest cruising 
range of any fishing vessel afloat, a powerful sending and receiv 
ing radio with a permanent operator on board, and an extremely 
secret Japanese invention enabling it to detect and locate mines. 

Like all other Japanese in the Canal Zone area, Amano, rated 
a millionaire in Chile, goes in for a little photography. In Sep 
tember, 1937, word spread along the international espionage 
grapevine that Nicaragua, through which the United States was 
planning another Canal, had some sort of peculiar fortifications 
in the military zone at Managua. 



SURROUNDING THE PANAMA CANAL 63 

Shortly thereafter the Japanese millionaire appeared at Mana 
gua with his expensive camera and headed straight for the 
military zone. Thirty minutes after he arrived (8:00 A.M. of 
October 7, 1937), he was in a Nicaraguan jail charged with sus 
pected espionage and with taking pictures in prohibited areas. 

I mention this incident because the luxurious boat was regis 
tered under the Panamanian flag and immediately began a series 
of actions so peculiar that the Republic of Panama canceled 
the Panamanian registry. The "Amano" promptly left for Pun- 
tarenas, Costa Rica, north of the Canal, which has a harbor big 
enough to take care of almost all the fleets in the world. Many 
of the Japanese ships went there, sounding lines and all, when 
alien fishing was prohibited in Panamanian waters. Today the 
"Amano Maru" is a mystery ship haunting Puntarenas and the 
waters between Costa Rica and Panama and occasionally vanish 
ing out to sea with her wireless crackling constantly. 

Some seventy fishing vessels operating out of San Diego, Cali 
fornia, fly the American flag. San Diego is of great importance 
to a potential enemy because it is a naval as well as an air base. 
Of these seventy vessels flying the American flag, ten are either 
partially or entirely manned by Japanese. 

Let me illustrate how boats fly the American flag: 

On March 9, 1937, the S.S. "Columbus" was registered as an 
American fishing vessel under certificate of registry No. 235,912, 
issued at Los Angeles. The vessel is owned by the Columbus 
Fishing Company of Los Angeles. The captain, R. I. Suenaga, 
is a twenty-six-year-old Japanese, born in Hawaii and a full- 
fledged American citizen. The navigator and one sailor are also 
Japanese, born in Hawaii but American citizens. The crew of 
ten consists entirely of Japanese born in Japan. 

The ten boats which fly the American flag but are manned by 
Japanese crews are: "Alert," "Asama," "Columbus," "Flying 



64 SECRET ARMIES 

Cloud," "Magellan," "Oipango," "San Lucas," "Santa Mar 
garita," "Taiyo," "Wesgate." 

Each boat carries a short-wave radio and has a cruising range 
of from three to five thousand miles, which is extraordinary for 
just little fishing boats. They operate on the high seas and where 
they go, only the master and crew and those who send them know. 
The only time anyone gets a record of them is when they come 
in to refuel or repair. 

In the event of war half a dozen of these fishing vessels, 
stretched across the Pacific at intervals of five hundred or a 
thousand miles, would make an excellent system of communica 
tion for messages which could be relayed from one to another 
and in a few moments reach their destination. 

In Col6n on the Atlantic side and in Panama on the Pacific, 
East and West literally meet at the crossroads of the world. The 
winding streets are crowded with the brown and black people 
who comprise three-fourths of Panama s population. On these 
teeming, hot, tropical streets are some three hundred Japanese 
storekeepers, fishermen, commission merchants and barbers- 
few of whom do much business, but all of whom sit patiently 
in their doorways, reading the newspapers or staring at the 
passer-by. 

I counted forty-seven Japanese barbers in Panama and eight 
in Col6n. In Panama they cluster on Avenida Central and Calle 
Carlos A. Mendoza. On both these streets rents are high and, 
with the exception of Saturdays when the natives come for hair 
cuts, the amount of business the barbers do does not warrant 
the three to five men in each shop. Yet, though they earn scarcely 
enough to meet their rent, there is not a lowly barber among 
them who does not have a Leica or Contax camera with which, 
until the sinking of the "Panay," they wandered around, photo 
graphing the Canal, the islands around the Canal, the coast line, 
and the topography of the region. 



SURROUNDING THE PANAMA CANAL 65 

They live in Panama with a sort of permanence, but nine out 
of ten do not have families even those advanced in years. Peri 
odically some of them take trips to Japan, though, if you watch 
their business carefully, you know they could not possibly have 
earned enough to pay for their passage. And those in the outly 
ing districts don t even pretend to have a business. They just 
sit and wait, without any visible means of support. It is not until 
you study their locations, as in the Province of Chorrera, that you 
find they are in spots of strategic military or naval importance. 

Since there were so many barbers in Panama, the need for an 
occasional gathering without attracting too much attention be 
came apparent. And so the little barber, A. Sonada, who shaves 
and cuts hair at 45 Carlos A. Mendoza Street, organized a "labor 
union," the Barbers Association. The Association will not ac 
cept barbers of other nationalities but will allow Japanese fish 
ermen to attend meetings. They meet on the second floor of the 
building at 58 Carlos A. Mendoza Street, where many of the 
fishermen live. At their meetings one guard stands outside the 
room and another downstairs at the entrance to the building. 

On hot Sunday afternoons when the Barbers Association 
gathers, the diplomatic representatives of other nations are 
usually taking a siesta or are down at the beach, but Tetsuo 
Umimoto, the Japanese Consul, climbs the stairs in the stuffy 
atmosphere and sits in on the deliberations of the barbers and 
visiting fishermen. It is the only barbers union I ever heard of 
whose deliberations were considered important enough for a 
diplomatic representative to attend. This labor union has an 
other extraordinary custom. It has a special fund to put com 
petitors up in business. Whenever a Japanese arrives in Panama, 
the Barbers Association opens a shop for him, buys the chairs- 
provides him with everything necessary to compete with them for 
the scarce trade in the shaving and shearing industryl 

At these meetings the barber Sonada, who is only a hired 



66 SECRET ARMIES 

hand, sits beside the Japanese Consul at the head of the room. 
Umimoto remains standing until Sonada is seated. When an 
other barber, T. Takano, who runs a little hole-in-the-wall shdp 
and lives at 10 Avenida B, shows up, both Sonada and the Con 
sul rise, bow very low and remain standing until he motions 
them to be seated. Maybe it s just an old Japanese custom, but 
the Consul does not extend the same courtesy to the other 
barbers. 

In attendance at these guarded meetings of the barbers union 
and visiting fishermen, is Katarino Kubayama, a gentle-faced, 
soft-spoken, middle-aged businessman with no visible business. 
He is fifty-five years old now and lives at Calle Colon, Casa 
No. 11. 

Way back in 1917 Kubayama was a barefoot Japanese fisher 
man like the others now on the west coast. One morning two 
Japanese battleships appeared and anchored in the harbor. From 
the reed- and vegetation covered jungle shore, a sun-dried, brown 
panga was rowed out by the barefooted fisherman using the short 
quick strokes of the native. His brown, soiled dungarees were 
rolled up to his calves; his shirt, open at the throat, was torn 
and his head was covered by a ragged straw hat. 

The silvery notes of a bugle sounded. The crew of the flagship 
lined up at attention. The officers, including the Commander, also 
waited stiffly at attention while the fisherman tied his panga to 
the ship s ladder. As Kubayama clambered on board, the of 
ficers saluted. With a great show of formality they escorted him 
to the Commander s quarters, the junior officer following behind 
at a respectful distance. Two hours later Kubayama was escorted 
to the ladder again, the trumpet sounded its salute, and the 
ragged fisherman rowed away all conducted with a courtesy ex 
tended only to a high ranking officer of the Japanese navy. 

Today Kubayama works closely with the Japanese Consul. 



SURROUNDING THE PANAMA CANAL 67 

Together they call upon the captains of Japanese ships whenever 
they come to Panama, and are closeted with them for hours at a 
time. Kubayama says he is trying to sell supplies to the captains. 

Japanese in the Canal Zone area change their names peri 
odically or come with several passports all prepared. There is, for 
instance, Shoichi Yokoi, who commutes between Japan and Pana 
ma without any commercial reasons. On June 7, 1934, the Jap 
anese Foreign Office in Tokyo issued passport No. 255,875 to 
him under the name of Masakazu Yokoy with permission to Visit 
all Central and South American countries. Though he had per 
mission for all, he applied only for a Panamanian visa (Septem 
ber 28, 1934), after which he settled down for a while among 
the fishermen and barbers. On July 11, 1936, the Foreign Office 
in Tokyo handed Yokoy another passport under the name of 
Shoichi Yokoi, together with visas which filled the whole pass 
port and overflowed onto several extra pages. Shoichi or Masa 
kazu is now traveling with both passports and a suitcase full of 
film for his camera. 

Several years ago a Japanese named T. Tahara came to Panama 
as the traveling representative of a newly organized company, the 
Official Japanese Association of Importers and Exporters for 
Latin America, and established headquarters in the offices of the 
Boyd Bros, shipping agency in Panama. 

Nelson Rounsevell, publisher of the Panama American, who 
has fought Japanese colonization in Canal areas, printed a story 
that this big businessman got very little mail, made no efforts to 
establish business contacts and, in talking with the few business 
men he met socially, showed a complete lack of knowledge about 
business. Tahara was talked about and orders promptly came 
through for him to return to Japan. 

This was in 1936. Half a year later, a suave Japanese named 
Takahiro Wakabayashi appeared in Panama as the representative 



68 SECRET ARMIES 

of the Federation of Japanese Importers and Exporters, the same 
organization under a slightly changed name. Wakabayashi 
checked into the cool and spacious Hotel Tivoli, run by the 
United States Government on Canal Zone territory and, pro 
tected by the guardian wings of the somewhat sleepy American 
Eagle, washed up and made a beeline for the Boyd Bros, office, 
where he was closeted with the general manager for over an hour. 

Wakabayashi s business interests ranged from taking pictures 
of the Canal in specially chartered planes, to negotiating for 
manganese deposits and attempting to establish an "experimental 
station to grow cotton in Costa Rica." 

The big manganese-and-cotton-photographer man fluttered all 
over Central and South America, always with his camera. One 
week he was in San Jose", Costa Rica; the next he made a hurried 
special flight to Bogota, Colombia (November 12, 1937) ; then 
back to Panama and Costa Rica. He finally got permission from 
Costa Rica to establish his experimental station. 

In obtaining that concession he was aided by Giuseppe Sotanis, 
an Italian gentleman wearing the fascist insignia in the lapel of 
his coat, whom he met at the Gran Hotel in San Jose. Sotanis, 
A former Italian artillery officer, is a nattily dressed, slender man 
in his early forties who apparently does nothing in San Jose ex 
cept study his immaculate finger nails, drink Scotch-and-sodas, 
collect stamps and vanish every few months only to reappear 
again, still studying his immaculate finger nails. It was Sotanis 
who arranged for Nicaragua to get the shipment of arms and 
munitions which I mentioned earlier. 

This uncommunicative Italian stamp collector paved the way 
for Wakabayashi to meet Raul Gurdian, the Costa Rican Min 
ister of Finance, and Ramon Madrigal, Vice-president of the 
government-owned National Bank and a prominent Costa Rican 
merchant. Shortly after Costa Rica gave Wakabayashi permission 
to experiment with his cotton growing, both the Minister of 



SURROUNDING THE PANAMA CANAL 69 

Finance and the Vice-president of the government bank took 
trips to Japan. 

The ink was scarcely dry on the agreement to permit the Japa 
nese to experiment in cotton growing before a Japanese steamer 
appeared in Puntarenas with twenty-one young and alert Japa 
nese and a bag of cotton seed. They were "laborers," Wakabay- 
ashi explained. The "laborers" were put up in first-class hotels 
and took life easy while Wakabayashi and one of the laborers 
started hunting a suitable spot on which to plant their bag of 
seed. All sorts of land was offered to them, but Wakabayashi 
wanted no land anywhere near a hill or a mountain. He finally 
found what he wanted half-way between Puntarenas and San 
Jos^ long, level, flat acres. He wanted this land at any price, 
finally paying for it an annual rental equal to the value of the 
acres. 

The twenty-one "laborers" who had been brought from Chim- 
bota, Peru, where there is a colony of twenty thousand Japanese, 
planted an acre with cotton seed and sat them down to rest, 
imperturbable, silent, waiting. The plowed land is now as smooth 
and level as the acres at Corinto in Colombia, south of the Canal. 

The harbor at Puntarenas, as I mentioned earlier, would make 
a splendid base of operations for an enemy fleet. Not far from 
shore are the flat, level acres of the "experimental station" and 
the twenty-one Japanese who could quickly turn these smooth 
acres into an air base. It is north of the Panama Canal and 
within two hours flying time of it, as Corinto is south of the 
Canal and within two hours flying time. 

The Boyd Bros, steamship agency, to which Tahara and Waka 
bayashi went immediately upon arrival, is an American concern. 
The manager, with whom each was closeted, is Hans Hermann 
Heildelk of Avenida Peru, No. 64, Panama City, and, though 
efforts have been made to keep it secret, part owner of the 



70 SECRET ARMIES 

agency. Heildelk is also the son-in-law of Ernst F. Neumann, 
the Nazi Consul to Panama. 

On November 15, 1937, Heildelk returned from Japan by way 
of Germany. Five days later, on November 20, 1937, his father- 
in-law, who, besides being Nazi Consul, owns in partnership with 
Fritz Kohpcke, one of the largest hardware stores in Panama, 
told his clerks that he and his partner would work a little late 
that night. Neither partner went out to eat and the corrugated 
sliding door of the store, at Norte No. 54 in the heart of the 
Panamanian commercial district, was left open about three feet 
from the ground so that passers-by could not see inside unless 
they stooped deliberately. 

At eight o clock a car drew up at the corner of the darkened 
street in front of Neumann & Kohpcke, Ltd. Two unidentified 
men, Heildelk and Walter Scharpp, former Nazi Consul at Colon 
who had also just returned from Germany, stepped out, and 
stooping under the partly open door, entered the store. Once 
inside Scharpp quietly assumed command. To all practical pur 
poses they were on German territory, for the Nazi consulate 
office was in the store. 

Scharpp announced that the group had been very carefully 
chosen because of their known loyalty to Nazi Germany and 
because of their desire to promote friendship for Germany in 
Latin American countries and to cooperate with the Japanese, 
who had their own organization functioning efficiently in Central 
and South America. 

"Some of these countries are already friendly," said Scharpp, 
"and we can work undisturbed provided we do not interfere 
in the Panama Canal Zone. It is North American territory, and 
you will have trouble from their officials and intelligence officers 
as well as political pressure from the States. You understand?" 

"Panama is friendly to North America," said Kohpcke. 



SURROUNDING THE PANAMA CANAL 71 

"Precisely. At the present time it is not wise to do much more 
than broadcast, but at a propitious time we shall be able to 
explain National Socialism to the Panamanians." 

He looked at Kohpcke, whose left eyelid droops more than his 
right, giving him the appearance of being perpetually sleepy. 
Kohpcke looked at Neumann. 

"Tonight we want to organize a Bund in Panama. In a few 
days I am going to Costa Rica to organize another and then leave 
for Valparaiso." 

The others nodded. They had been informed that Scharpp was 
to have complete charge of Nazi activities from Valparaiso to 
Panama. That night they established Der Deutsch-Ausldndische 
Nazi Genossenschafts Bund, with the understanding that it func 
tion secretly. The list of members was to be controlled by 
Neumann. 

Scharpp explained that secrecy was advisable to avoid antago 
nizing the Panamanian Government, "which is friendly to Italy 
and we can cooperate with the Italian Legation here." 

"The Japanese are more important that the Italians," Kohpcke 
pointed out. 

"The Japanese will work with us," Heildelk assured him. 

"But we can t be seen with them" 

"Fritz [Kohpcke] will call a meeting in Jacobs house," said 
Scharpp. 

"Jacobs!" exclaimed one of the unidentified men. "You don t 
mean the Austrian Consul 1" 

Scharpp nodded slowly. "He is generally believed to be anti- 
Nazi. His partner spent twelve years in Japan and speaks Jap 
anese perfectly. The Japanese Consul knows and trusts both. 
We cannot find a better place." 

On the night of December 13, 1937, forty carefully selected 
Germans who, during the intervening month had become mem 
bers of the Bund in Panama, arrived singly and in small groups 



72 SECRET ARMIES 

at the home of August Jacobs-Kantstein, Panamanian merchant 
and Austrian Honorary Consul. 

Five Japanese, headed by Tetsuo Umimoto, also came. One, 
K. Ishibashi, formerly captain of the "Hokkai Maru" and a 
reserve officer in the Japanese Navy; K. Ohihara, a Japanese 
agent staying with the Japanese Consul but having no visible 
reason to be in Panama; two captains of Japanese fishing boats 
and A. Sonada, the barber who organized the labor union and 
in whose presence the Consul does not sit until the barber is 
seated. 

Throughout the meeting, presided over by the elderly but tall 
and soldierly Austrian Consul, the Japanese said little. It was 
primarily the first get-together for Nazi-Japanese cooperation in 
the Canal Zone area. 

"Mr. Umimoto has not said much," remarked Jacobs. 

"There is so little to say when there are so many present, 1 
said the little Consul apologetically. 

The others understood. The Japanese were too shrewd to dis 
cuss detailed plans with so many present. 

A few days later Umimoto called upon Heildelk and was 
closeted with him for three hours. Shortly after that Sonada 
made a hurried trip to Japan. 



VI 

Secret Agents Arrive in America 

GERMANY S INTEREST IN THE PANAMA CANAL became acute 
only after Japan joined the Rome-Berlin axis "to exchange 
information about Communism" an exchange which appears to 
be more concerned with military secrets than with Communism. 
The activities of Japanese and Nazi agents in Latin American 
countries and especially around the Canal, the organizing of a 
fascist rebellion in Mexico to the south of us and intensive propa 
ganda carried on in Canada to the north, are but part of the 
broad invasion of the Western Hemisphere by the Fifth Column 
an invasion which began almost immediately after Hitler got 
into power. Since the United States is the most important coun 
try in the Americas, it was and is subject to special concentra 
tion by secret Nazi agents. 

The first threads spun spread out in many directions, with 
propaganda as the base from which to broaden espionage activi 
ties. One of the earliest of the secret agents sent to this country 
was an American, Colonel Edwin Emerson, soldier of fortune, 
mediocre author and fairly competent war correspondent. Emer 
son lived at 215 East 15th Street, New York City and had an 
office in Room 1923 at 17 Battery Place, the address of the 
German Consulate General. Room 1923 was rented by a repre 
sentative of the German Consul General. The rent paid was. 
nominal and in at least one instance, to avoid its being traced, 

73 



74 SECRET ARMIES 

it was paid in cash by Hitler s diplomatic representative. Prior 
to the renting of this room, Emerson had desk space with the 
German Consulate General for six weeks. 

The May 15, 1933, issue of the Amerika Deutsche Post, a Nazi 
propaganda organ published in New York, carried an advertise 
ment stating that the editor of this paper made his headquarters 
in Emerson s room. This was the first indication that Emerson 
had arrived in this country to handle Nazi propaganda. 

For many years Emerson had wandered about the globe cover 
ing assignments for newspapers and magazines and always brag 
ging about his Americanism and his "patriotism." One of his 
great boasts was that he was with Roosevelt s Rough Riders dur 
ing the Spanish-American war; what he never told was that 
Roosevelt brought him back from Cuba in irons. 

From his room paid for by the German Consul General, Emer 
son launched the "Friends of Germany." * This organization was 
the chief disseminator of pro-Hitler and anti-democratic propa 
ganda in the United States, but the Colonel directed the propa 
ganda somewhat stupidly. The "Friends of Germany" held 
meetings with "storm troops" in full uniform; bitter attacks 
were made against Jews and Catholics at large mass meetings. 
Visiting officers and sailors, from German ships docked in New 
York, appeared at these meetings to preach fascism and Nazism, 
until a wave of resentment swept the country. One of the key 
notes of these talks was sounded by Edward F. Sullivan of Boston 
at a meeting held at Turnhalle, Lexington Avenue and 85th 
Street, on June 5th, 1934, when he repeatedly referred to Jews 
as "dirty, stinking kikes" and announced that he proposed to 
organize a strong Nazi group in Boston. 

Propaganda Minister Goebbels in Berlin became annoyed at 
the public reaction, and the entire Nazi foreign propaganda 
service was reorganized. Emerson was ordered back to Germany 

* Subsequently changed to "Friends of the New Germany" and then to the 
current "German-American Bund." 



SECRET AGENTS ARRIVE IN AMERICA 75 

for explicit instructions on how to carry on propaganda without 
antagonizing the entire country. 

In October, 1933, Royal Scott Gulden (who has no connec 
tion with the mustard business, but is a distant relative of the 
head of it) , who had been cooperating with Emerson, tried to 
organize an espionage system to watch Communists. In this 
effort Gulden enlisted the aid of Fred R. Marvin, a professional 
patriot. At three o clock on the afternoon of March 10, 1934, a 
very secret meeting was called by Gulden at 139 East 57th Street. 
Present were Gulden, J. Schmidt and William Dudley Pelley, 
head of the Silver Shirts. 

The meeting decided to adopt anti-semitic propaganda to 
play on latent anti-semitism as part of the first campaign to at 
tract followers. The country was in a serious economic crisis with 
considerable unrest throughout the land. Both Hitler and Mus 
solini got into power in periods of great unrest by promising 
peace and security to the bewildered people. Men of means were 
terrified by fears of "revolution" and this group, directed by 
Emerson, began to preach that the revolution might come any 
minute and that he Jews were responsible for Moscow, the 
Third International, the Mississippi flood and anything else that 
troubled the people. When the meeting ended the "Order of 
76" * had been born and Royal Scott Gulden appointed Secre 
tary to direct espionage and propaganda. 

From the very beginning Emerson tried to get people into 
places which would provide access to important information. 
On February 22, 1934, a merger of the Republican Senatorial 
and Congressional Campaign Committees to conduct the Party s 
Congressional campaign independent of the Republican National 
Committee was announced in a joint statement by Senator Daniel 

* Still functioning on a minor scale. The Fifth Column has since these 
early beginnings established much more efficient groups. 



76 SECRET ARMIES 

O. Hastings of Delaware and Representative Chester C. Bolton 
of Ohio, chairmen, respectively, of the two committees. 

Several weeks before this announcement, the two committees 
had employed Sidney Brooks, for years head of the research 
bureau of the International Telephone and Telegraph Com 
pany. Brooks, because of his position, was close in the confi 
dences of Republican Senators and Congressmen. He heard 
state secrets and had his fingers on the political pulse of the 
country. 

Shortly after he took charge of the joint committee for the 
Senators and Congressmen, Brooks made a hurried visit to New 
York. On March 4, 1934, he drove to the Hotel Edison and 
ivent directly to Room 830 where a man registered as "William 
D. Goodales Los Angeles," was awaiting him. Mr. "Goodales" 
was William Dudley Pelley, head of the Silver Shirts, who had 
come to New York to confer with Brooks and Gulden. After 
this conference the two went to Gulden s office where they had 
a confidential talk that lasted over an hour during which an 
agreement was made to merge the Order of 76 with the Silver 
Shirts so as to carry on their propaganda more effectively. 

Brooks himself, on his mysterious visits to New York, went 
to 17 Battery Place, which houses the German Consulate General. 
At that address he visited one John E. Kelly. In a letter to Kelly 
dated as far back as December 27, 1933, he wrote: "I will be in 
New York Friday to Monday and can be reached in the usual 
manner Gramercy 5-9193 (care Emerson) ." 

Sidney Brooks also was a member of the secret Order of 76. 
Before anyone could join he had to give, in his own handwriting 
and sealed with his own fingerprints, certain details of his life. 
Brooks application for membership in this espionage group or 
ganized with the help of a Nazi sent to this country, revealed that 
he was the son of the Nazi agent, Colonel Edwin Emerson, and 
that he was using his mother s maiden name so that connection 
could not be traced too easily. 



SECRET AGENTS ARRIVE IN AMERICA 



77 




78 SECRET ARMIES 

One of the other early propagandists who is still active as a 
"patriot" was Edward H. Hunter, Executive Secretary of the 
Industrial Defense Association, Inc., 7 Water Street, Boston. 
Early in 1934, while the negotiations for the merging of the 
espionage order and the Silver Shirts were going on, this rooter 
for American liberty heard Germany was spending money in 
this country and on March 3, he wrote to the "Friends of 
Germany": 

"Under separate cover we are sending you twenty-five copies 
of our Swan Song of Hate as requested and you may have as 
many as you wish. 

"Several times I have conferred with Dr. Tippelskirch and at 
one time suggested that if he could secure the financial backing 
from Germany, I could start a real campaign along lines that 
would be very effective. 

"All that is necessary to return America to Americans is to 
organize the many thousands of persons who are victims of 
Judaism and I am ready to do that at any time." 

Dr. Tippelskirch, with whom Hunter discussed getting money 
from Germany for anti-semitic work, was the German Consul in 
Boston. 

The activities of the early agents ranged from propaganda to 
smuggling and espionage, though at the beginning the espionage 
was on a minor scale. It took several years of organizing pro- 
German groups in this country before they could pick the most 
reliable for the more dangerous spy work. Much of the propa 
ganda was sent in openly through the mails, but some of it was 
of so vicious and anti-democratic character that the Propaganda 
Ministry in Germany decided it was wiser to smuggle it in from 
Nazi ships. 

One of the chief smugglers was Guenther Orgell,* at that 



* Following passage of the new 1938 law requiring all foreign agents to 
register, Orgell registered with the State Department as a German agent. 



SECRET AGENTS ARRIVE IN AMERICA 79 

time head of the "Friends of Germany," through whom the 
propaganda was distributed to various branches of the organiza 
tion throughout the country. In those days Orgell lived at 606 
West i i5th Street, New York City,f and was ostensibly employed 
as an electrical engineer by the Raymond Roth Co., 25 West 
45th Street. Let me illustrate how he worked: 

At twenty minutes to ten on the evening of March 16, 1934, 
the North German Lloyd "Europa" was preparing to sail at 
midnight. The gaily illuminated boat was filled with men and 
women, many in evening dress, seeing friends off to Europe. 
German stewards, all of them members of the ship s Nazi Gruppe, 
stood about smiling, bowing, but watching every passenger and 
visitor carefully. 

People wandered all over the boat. Many visited the library 
on the main promenade deck, which has a German post office. 
There was a great deal of laughter and chatter. Orgell, dressed in 
an ordinary business suit and carrying a folded newspaper in his 
hands, wandered in. Catching the post office steward s eye, he 
casually took four letters from his coat pocket and handed them 
to the steward who as casually slipped them into his pocket. 
There were no stamps on the letters, which, incidentally, consti 
tuted a federal offense. 

Still so casual in manner that the average observer would not 
even have noticed the transfer of the letters, Orgell wandered 
over to a desk in the library and rapidly wrote another letter- 
so important, apparently, that he dared not carry it with him 
for fear of a mishap. The letter was sealed and handed to the 
steward. 

The library had a great many visitors. No one seemed to be 
paying any attention to this visitor or passenger talking to the 
steward. With a quick glance around him, Orgell took in every 
one in the library and seemed satisfied. He caught the steward s 

f He now lives at Great Kills, Staten Island, N. Y. 



80 SECRET ARMIES 

eye again and nodded. The steward opened a closet in the 
library, the second one left of the main aisle on the port side 
toward the stern of the boat. A thin package was taken from its 
hiding place and quickly slipped to Orgell who covered it with 
his newspaper and promptly left the ship. 

This was the manner in which Nazi secret instructions and 
spy reports were sent and received a procedure that kept up 
until the arrest of the Nazi spies who were tried late in 1938. 

When Orgell needed trusted men to deliver messages to and 
from the boats as well as to smuggle off material, he usually 
called upon the American branch of the Stahlhelm, or Steel 
Helmets, which used to drill secretly in anticipation of Der Tag 
in this country. Only when he felt that he was not being 
watched, or only in the event of the most important messages, 
did he go aboard the ships personally. Orgell s liaison man in 
the smuggling activities was Frank Mutschinski, a painting con 
tractor who used to live at 116 Garland Court, Garritsen Beach, 
N. Y. 

Mutschinski came to the United States from Germany on the 
S.S. "George Washington," June 16, 1920. He was commander 
of one of the American branches of the Stahlhelm which had 
offices at 174 East 85th Street, New York. While he was in com 
mand, he received his orders direct from Franz Seldte, subse 
quently Minister of Labor under Hitler. Seldte at that time 
was in Magdeburg, Germany. Branches of the Stahlhelm were 
established by him and Orgell in Rochester, Chicago, Phila 
delphia, Newark, Detroit, Los Angeles and Toronto (the first 
step in the Fifth Column s invasion of Canada) . 

To help Orgell in his smuggling activities, Mutschinski sup 
plied him with a chief assistant, Carl Brunkhorst. It was Brunk- 
horst s job to deliver the secret letters. Nazi uniforms for Ameri 
can Storm Troopers were smuggled into this country off Ger 
man ships by Paul Bante who lived at 186 East 9$rd Street, New 



SECRET AGENTS ARRIVE IN AMERICA 81 

York City. Bante, at the time he was engaged in the smuggling 
activities, was a member of the 244th Coast Guard as well as 
the New York National Guard. 

In the early days of organizing the Nazi web over the United 
States, the German agents received cooperation from racketeering 
"patriots" who saw possibilities of scaring the wits out of the 
American people by announcing that the "revolution" was just 
around the corner. The country was in an economic crisis, the 
American people were bewildered and didn t know which way to 
turn, there was considerable unrest in the land, and the Nazi 
agents and their American counterparts visualized in Hitler s cry 
that "Communism and the Jews" were responsible, grand pickings 
from the scared suckers. 

Since Communism, especially in those restless days in the 
depths of the depression, was the bugaboo of the rich, it was 
inevitable that some unscrupulous but shrewd observers of the 
American scene would take advantage of this fear and capital 
ize on it. One of the chief racketeers, a man who subsequently 
worked very closely with secret Nazi agents in this country, was 
Harry A. Jung, Honorary General Manager of the American 
Vigilant Intelligence Federation, Post Office Box 144, Chicago. 
This organization was originally founded to spy on Communists 
and Socialists. For a while Jung collected from terrified em 
ployers by promising to inform them about the threat of revolu 
tionwhat time it would occur and who would lead it. In return 
he collected plenty. 

In time employers got fed up when the rowboat loaded with 
bomb-throwing Bolsheviks failed to arrive from Moscow. Pick 
ings became slim. Jung was badly in need of a new terror- 
inspiring "issue" with which to collect from the suckers. He 
found it at the time Emerson was sent here from Germany. 
Gulden, Pelley and their associates were launching an anti- 
semitic campaign as the first step to attract people to the "Friends 



82 SECRET ARMIES 



^ tttwrtattt ^^^S^SK^ sto** 8 **** 1 



NA1 



CHICAGO. ILL. 



"jr. fiarry F. sieber. Twarurer. 
Silver Le/dcn of Amertc* . 



Datr 1 r. $i % er: 



In Vecponse to your* 
addressed to ^..L. Peterson on 
)ser 28. we cuTMVf you" a prior of 
sixty cents per copy In quantity lots 
of tht "Protocdle*. 

As for "Halt. >ntilJ 
and Salute tht Jew", sane can be haJ 
at ten cents per copy, in quantity 
lot* or fiflcen cents apiece. 




EAJ/BP 

43550. L icbican AT. . R.2212 




Showing the type of literature peddled by patrioteer Harry A. Jung. 



SECRET AGENTS ARRIVE IN AMERICA 83 

of Germany." Jung likewise discovered the "menace of the Jew" 
and peddled it for all it was worth. 

There was an air of secrecy about the whole outfit. Even the 
location of the office in the Chicago Tribune Tower was kept 
from the membership; all they were given was the post office box 
number. As soon as he collected enough material from the Daily 
Worker and other Communist publications, he sent agents to 
call on the gullible businessmen with horrendous stories of the 
Muscovites now on the high seas on their way to capture the 
American Government. The salesmen collected and in turn got 
forty per cent of the pickings. 

When Jung heard that William Dudley Pelley was making 
money on the Jew-and-Catholic scare and that others like Edward 
H. Hunter of the Industrial Defense Association were talking 
with the German Consul General about getting money from 
Germany for propaganda, he got busy peddling "The Protocols 
of the Elders of Zion," long discredited as forgeries. Armed with 
these, Jung s high pressure salesmen scoured the country, collect 
ing shekels from Christian businessmen and getting their forty 
per cent commissions. 

It was not long before Jung, Pelley and others were working 
in full swing with secret Nazi agents sent into this country for 
propaganda and espionage purposes. 



o 



VII 

Spies and American "Patriots" 

NCE THE SPADEWORK WAS DONE by the early Nazi agents sent 
into the United States, the web rapidly embraced native 
fascists, racketeering "patriots" and deluded Americans who swal 
lowed their propaganda. When Japan joined the Rome-Berlin 
axis, espionage directed against American naval and military 
forces became one of the major interests of the foreign agents, 
especially on the West Coast. 

Some five years ago, after the McCormick Congressional Com 
mittee investigation into Nazi activities turned up a number of 
propagandists, there was a lull in their activity until the nation 
wide denunciations died out. In the meantime Goebbels again 
ordered the reorganization of the entire propaganda machine in 
this country. 

It was during this period that the approaching Presidential 
elections presented an immediate task for the Nazis to work on. 
The Roosevelt Administration was considered by the Nazis both 
here and in Germany as none too friendly to Hitler, and before 
the election got well under way the Nazis here, upon instruc 
tions from their local leaders who act only upon instructions 
from the German Propaganda Bureau, became active in the anti- 
Roosevelt campaign. Both Nazi agents and "patriotic" Ameri 
can groups working with Nazi agents (without much money 
after the Congressional Committee s exposes) suddenly found 
themselves possessed of more than enough capital with which to 

84 



NAZI SPIES AND AMERICAN "PATRIOTS" 85 

operate. Some of the money came from the Nazis and some from 
anti-Roosevelt forces. 

One of the most vicious of the anti-Roosevelt propaganda medi 
ums was established by Nazi agents in a carefully hidden print 
ing plant. 



MENE, MCNEt TCXEL UPBHftRON 

MJEWISOisOOALPERIL 

GET RID OF ROOSEVELT 
AND HIS JEWS 

ELIMINATE JEWS FAOM PUBLIC OFFICE 

SMASH JEW-DOBUNATON OF 
W.P.A. and S.R.A. 

AND ALL STATE AND COUNTY CHARITY RELIEF 

R*d UK) *M^ * Protect* of tbe EUen of Zm. 
Aa Exposure of J^-Conauaat CoMptncjr. 

JW tfan.H.. A44M0 H, ** WUt. OMH F. O. BM I EMI F < 



Anti-Semitic anti-Roosevelt handbill issued by the American White Guard in 
California. 

No one who got off on the sixth floor at 325 W. Ohio St., Chi 
cago, and entered the John Baumgarth s Specialty Company, 
would have suspected anything out of the ordinary about the 
place. It looked just like hundreds of other business firms where 
pale girls and anemic-looking men made calendars. 



86 SECRET ARMIES 

People came up on the ancient elevator, attended to their 
affairs at the desks in front of the door, and left. Very few of them 
ever went behind the enormous piles of cardboard and paper 
which almost obstructed the passage to the right of the desks. 
But if you turned into this passage and then turned to the left, 
you came upon a wooden partition. Unless you were watching 
for it you would think it a wall. 

There was no indication of what was behind the partition. 
There was only a shiny Yale lock in a door carefully hidden from 
the eyes of casual visitors. If you knew nothing about it and tried 
to open the the door, you would find it locked. If you knocked 
or banged on it, there would be no answering sign from the other 
side, and the young man operating the cutting machine along 
side the partition would merely stare at you blankly. 

But if you knocked three times quickly, paused for a split 
second and then knocked once more, the door would be opened 
immediately. Without the proper signal all the knocking in the 
world would not help, for this was the entrance to the carefully 
guarded publication rooms of the American Gentile and the 
headquarters for Nazi anti-democratic activities in the Middle 
West. But even more guarded than the location of the printing 
plant were the goings and comings of the paper s editor, Captain 
Victor DeKayville and his financial backer, Charles O Brien. 

This brings me to two of the leading Nazi agents in the 
United States, one of whom originally started the newspaper. 
Certainly none of the American suckers who gave them money 
to spread pro-Nazi propaganda knew that both were masquerad 
ing under false names and that one of them is an ex-convict. 

Those social leaders in Chicago and San Francisco, whose 
doors were always open to the handsome, dashing Prince Peter 
Kushubue with his sad eyes and his talk of how the Bolsheviki 
had confiscated his vast estates and family jewels in Old Russia, 
may be interested to learn that his Highness, the Prince, is really 



NAZI SPIES AND AMERICAN "PATRIOTS" 87 

well, let me give a brief sketch of his activities before he 
became a Nazi agent: 

In 1922, a Russian emigre, born in Petrograd and christened 
Peter Afanassieff or Aphanassieff, came to the United States seek 
ing his fortune, preferably in the form of a wealthy heiress. As 
an ordinary run-of-the-mill Afanassieff, he was just an unem 
ployed White Russian looking for a job and it didn t take him 
long to discover that in this democratic country heiresses and 
their doting papas go nuts over titles. So overnight Peter 
Afanassieff blossomed out into Prince Peter Kushubue; and as a 
Prince whose wealth had been confiscated by the Bolsheviki, the 
doors of San Francisco society opened to him. 

Afanassieff just barely missed marrying a wealthy heiress on 
the West Coast, and in his despondence he tried his hand at a 
little forgery. But he picked the wrong outfit to practice pen 
manship on. He forged a United States Treasury check and when 
the federal men got after him he fled to Chicago. He was picked 
up and on November 29, 1929, he found himself before a U. S. 
Commissioner who ordered his return to San Francisco. On 
December 19 of the same year he pleaded guilty before Federal 
Judge F. J. Kerrigan and was given a year and a half. At the 
trial he admitted to being just an ordinary Afanassieff and served 
his sentence under that name. 

When he came out he alternated between being Prince Kushu 
bue and an ordinary Afanassieff and then, because the 1930 crash 
had kicked the bottom out of the market for foreign titles, he 
picked himself a good solid American name: Armstrong. He said 
it was his mother s maiden name. For convenience we ll call him 
Armstrong from now on. 

When he arrived in Chicago in 1933, he met some White 
Russians who were working with Harry A. Jung on an altogether 
new translation of the "Protocols." Jung planned to publish 
and distribute the forgeries in order to scare the wits out of his 
Christian suckers, but changed his mind when he discovered he 



88 SECRET ARMIES 

could buy them cheaper and resell at a higher price. Jung, in 
turn, introduced Armstrong to Nazi agents. 

Jung and the ex-convict hit it up. Before long Armstrong be 
came Jung s secret agent No. 31 (Jung is No. i and always signs 
his letters to agents with that number. His agents, too, sign only 
their numbers. They are not supposed even to write the number 
but every once in a while an agent slips up and scribbles a post 
script in his own handwriting. A reproduction of one of No. 31*5 
reports to the No. i Guy appears on the opposite page.) 

It was not long after Jung introduced Armstrong to Nazi 
agents that the White Russian decided that he could work the 
racket himself. He began to meet secretly with Nazi agents with 
out telling Jung about it. Their favorite meeting place was at 
Von Thenen s Tavern, 2357 Roscoe St., Chicago. Present at 
these meetings, usually called by Fritz Gissibl, head of the 
"Friends of the New Germany," * were Armstrong, Captain Vic 
tor DeKayville, J. K. Leibl (who organized an underground Nazi 
clique in South Bend, Ind.), Oscar Pfaus, Nick Mueller, Toni 
Mueller, Jose Martini, Franz Schaeffer and Gregor Buss. When 
Gissibl couldn t attend, his right-hand man Leibl acted for him. 

In March, 1936, Armstrong and the others decided to establish 
a "National Alliance" to aid in Nazi work. They decided to use 
the utmost secrecy lest what they were doing and who were be 
hind it, leak out. They met only in private homes and so careful 
were they that the host of one meeting would not be told where 
the next meeting was to be held. Only a picked handful of the 
most trusted Nazi agents were invited. 

The first meeting was held at Bockhold s home, 1235 Wave- 
land Ave., Chicago; the second at the home of Mrs. Emma 
Schmid, 4710 Winthrop Ave., Chicago. To the second meeting 
they invited C. O. Anderson of 601 Diversey Parkway, Chicago. 



* Gissibl left for Stuttgart, Germany, and leadership was taken over by his 
brother, Peter. 



NAZI SPIES AND AMERICAN "PATRIOTS 



89 



Cr*J*l 
Dea * J 

r Tw of tvelvth instant rjieiYed and ttr.Shera deilrered your packat*o * Us* 
ftaturday. 

Keferlng to y of n/lntt.Iwae able to aoaplieh only part of eJob.Mr.Thoapeon 
n<l VnTolllafV* r8 * of tomco I ll try to g*t in tueh altX both on Monday, 
6atur<iy a.avlhad ono hoof and 20n.talk with editor of O.R .Herald Mr. Prank ?*. 
H read ty crIsilal and afttr eoTr>iac a. thile w c(ra*4 upon that oethlat \ 
| rtould be do and <o In a hwry.Ileft with that ehp our 5 do*nt( legal U). X 
IBWBO oa Footer .A.T^I.F. prograe/Blua/C.P.U.B.A.chart.Falat the fete eiid TigHant. 
I thMc it win be food ide* if you nd hln af liaea aentloninf ho* glad you are 
e.t.e.6am erenin I reeeived inTitatlon to attend diner at Dr.Ferri* K. Smith (6J9 Plof- 
cnrlh bld. Grand Rapidt.Hich. )Ht la a rery prominent ,rieh and Intemationaly toom 
?l4ik 6wrgry epeeialivt.In v honour we had ? bottlea of ehe^tlgn and other thln 
| bMitfe.Dlner party ended at 4.?0 n.a.8unday.Moat iotereating part of it that Hr.8<oith 
I Juet fe* w*ke ago eaae baek froa O.S.f.R.Aere abe apead 10 daya In MoaM.fhe i very 
I llTereed In BoleheTik end of our problem* But alao very auch like to find outother 
I tRT-fi? g .^o laet nlte aha pledged henelf to A.T.I.P.and will* aigte card on *y return 
I aok to Grand RapUa.Mr.Oerry D.FettiboM of 306 Lafayette Ave.M.K.-ei*ed crdiat 
I Tueeday but did not paid oney-will Collect later. 

Fpeeklng of |79 accoHlng to opinion of Or.S.O.he lakee backbone ae an orjnii-r.^ 
I nl-.-ne nwaUr that I Quoting aoM ana elee opinion.! can not have of ay ow in thi* 
I CMC coe I a., hi. o littl*. 

Toaurro* 1 lUry U *ee T o infiena and ala_Tnompeom.Then in en Enlng to 1 i 

I again r. f.rf.fcith.. 

I T o - * -c 

Awloa. 



Letter written by secret agent No. 31 (Peter Afanassieff, alias Prince Kushubue, 
alias Peter V. Armstrong) to No. i (Harry A. Jung) . 



90 



SECRET ARMIES 



**tlln 40, Jn dtn Jtltea 



Herrn 

Peter V. Armstrong 

i.Pa. Patriotic Publishing Co. 

C h j c a K o . 



Dear Sir, 

By Mr. Lilienfeld we were informed that you are interested in 
the english edition of our book:. Herman Pehst. BolBchewism 
Jewf y w beg to^ inform ^ou^ that the right of edition of this 



later on we will deduct the sale every half a 



ffe- await witn Interest your answer 



Yours faithfully 

ttibeUmgen* 




Letter showing contact between Peter V. Armstrong (the White Russian ex- 
convict Peter Afanassieff) and German publishers of anti-Semitic literature. 

He was listed by the Nazis and the White Russians as a good 
sucker because he had contributed money to Jung. 

The White Russians and the Nazi agents then decided to start 
a publishing business as the first step to attract followers. They 
issued a paper called the Gentile Front. They were extremely 



NAZI SPIES AND AMERICAN "PATRIOTS" 91 

careful to keep the editorial and publication addresses secret. 
All mail was sent only to Post Office Box No. 526 in the old 
Chicago Post Office. The company was named the Patriotic Pub 
lishing Co. and with the utmost secrecy editorial offices were 
established at 5 S. Wabash in Chicago and the paper printed in 
the basement at 4233 N. Kildare where the Merrimac Press 
functioned. 

Subsequently, to throw anyone who might be watching them 
off the trail, they changed the name of the publishing company 
to the Right Cause Publishing Co. and issued an avalanche of 
Nazi propaganda. It was through this secretly organized and 
secretly functioning propaganda center that Harry A. Jung, 
ultra-"patriot," distributed printed attacks on Roosevelt just be 
fore the Presidential election. 

The American Gentile,, backed by Nazi money, published the 
most insane rantings imaginable. But when one is inclined to 
dismiss them as insanity, one remembers that it was the same sort 
of stuff Hitler used in winning millions of bewildered Germans 
to his banner. The pre-election issue (October, 1936) of the 
Gentile will serve as an illustration of what they published and 
distributed through the United States mails: 

Former Congressman Louis T. McFadden* died on October 
i from a stroke. He was sixty years old. The American Gentile, 
however, implied that he had been murdered by Jews; Senator 
Bronson Cutting (killed in an airplane crash) also was murdered 
by Jews. Huey Long was murdered by Jews. Walter A. Liggett, 
the newspaper editor, was murdered by Jews, and it was an 
international ring of Jewish bankers who hired Booth to murder 
Abraham Lincoln. 

Of course it was crazy, but the coal digger in Kentucky or 
the bedeviled farmer in the Middle West who couldn t pay his 

* Before McFadden died, I published evidence that while he was a member 
of Congress he worked with Nazi agents in this country. 



92 SECRET ARMIES 

taxes or the unemployed worker in an industrial center who 
couldn t find a job did not know history any too well nor under 
stand the workings of the economic system; and when they were 
told by newspapers brought to them by the United States Gov 
ernment mails that their economic difficulties were due to a 
Jewish-Communist plot, that Roosevelt was a Jew and was con 
trolled by Jews and Communists, some of them were prone to 
believe it. With this irresponsible propaganda anti-semitism 
grew. Men and women were attracted to the Nazi web without 
dreaming of the forces disseminating the propaganda of the 
motives behind them. 

The most capable of those drawn into the Nazi propaganda 
machine were chosen for more serious work. Some were used 
for propaganda; others were given definite espionage assignments. 
The espionage and propaganda divisions of the Nazi machine in 
this country are separate bodies. They overlap only in serving as 
a recruiting ground. 

The smuggling of anti-democratic propaganda off Nazi ships 
entering American ports was exposed by the McCormick Con 
gressional Committee, but it stopped only for a brief period. The 
Nazi ships which bring in propaganda also bring secret instruc 
tions to agents here and take back their reports. To eliminate 
tell-tale evidence, Dr. George Gyssling, Nazi Consul in Los 
Angeles, has paid out cash to leaders of the German propaganda 
machine on the West Coast. Affidavits to this effect are in my 
possession. 

The headquarters for the West Coast propaganda machine 
which dabbles a little in espionage, is the Deutsches Haus, 634 
W. i5th Street, Los Angeles. The building is supposed to be 
merely a meeting place for German-Americans and sympathizers 
of the Hitler regime. Actually its functions are far more sinister. 

The Deutsches Haus, before it was turned into a center of Nazi 
activity, had been a typical Los Angeles home. When the Nazis 



NAZI SPIES AND AMERICAN "PATRIOTS" 93 

took it over, they ripped out several of the front rooms and 
turned it into a barn-like affair with a skylight overhead and a 
raised platform from which speakers sing the praises of Hitler 
and fascism. In the rear part of the hall is a combined bar and 
restaurant where the German-Americans drink their beer and 
whiskies and plot the smuggling of propaganda from Nazi ships 
and the carrying on of espionage against American military and 
naval forces. 

I use the word "plot" for precisely what it means. From this 
house, naturalized American citizens and native Americans direct 
espionage and propaganda activities paid for by a foreign govern 
ment and designed against the peace and security of the United 
States. 

The leader of this group, Hermann Schwinn, was appointed 
by Minister of Propaganda Goebbels in Germany and is the 
recipient of personal letters of praise from Adolf Hitler for his 
work. Schwinn is a naturalized citizen,* a comparatively young 
man in his early thirties, ruddy-faced and with a thin, quivering 
mustache on his upper lip. This little Fiihrer s office is just off 
the meeting hall and adjoins the small bookstore where the pur 
chaser can get pamphlets, books, and newspapers attacking 
democracy. 

When I called upon Schwinn at the Nazi headquarters and 
introduced myself, he smiled amiably and granted my request 
for an interview. The German-American Bund, he explained im 
mediately (the reorganized Friends of the New Germany) , is 
now a patriotic organization, consisting only of American 
citizens. 

The German-American Bund, Schwinn continued as we seated 
ourselves in his office, was now a "patriotic organization striving 
to create among Americans a better understanding of Nazi Ger- 

* As this book went to press, the U. S. Government had just begun action to 
revoke Schwinn s citizenship, claiming that he had obtained it by making 
false statements. 



94 SECRET ARMIES 

many, to combat anti-Nazi propaganda and the boycott against 
Germany, and to fight Communism." He took about ten minutes 
to explain their peaceful objectives and their great love for the 
United States. 

"Everything is America for the Americans and to fight all 
alien theories and interests?" I asked, summing up his explana 
tion. 

"That s right," he beamed. 

"Does any propaganda come from Germany to help save 
America for the Americans?" 

"No, sir!" he said. "We have nothing to do with Germany; 
we are Americans first. Mr. Dickstein* says that there is propa 
ganda coming, but he was never able to prove any of his state 
ments." 

"Then how does propaganda like World Service from Erfurt, 
Germany, get into this country?" 

"Oh, I get it," he said casually. "Anyone can subscribe to it 
for a dollar and a half a year. We get two or three copies around 
here by subscription, of course." 

"There must be a lot of subscribers in the United States for 
I ve seen a great many copies. I thought that perhaps it comes in 
batches from Germany for distribution here so members of the 
Nazi groups in the United States could use it to help save 
America for the Americans." 

"No," he smiled. "It s all a subscription matter." 

"I see. Do you know Captain George Trauernicht?" 

Schwinn shot a startled glance at me and nodded slowly. "Yes," 
he said, "he s Captain of the Hapag Line ship Oakland. " 

"Do you ever visit him?" 

"Yes; he was here last week." 

* Congressman Samuel Dickstein. The McCormick Congressional Committee 
was frequently referred to as the "Dickstein Committee" because Dickstein 
had introduced the resolution for the investigation. 



NAZI SPIES AND AMERICAN "PATRIOTS" 95 

"Doesn t he bring batches of World Service and other propa 
ganda for you every time he comes into port?" 

"No," Schwinn said sharply. "The visits I pay him are purely 
social. Just to drink a glass of good German beer." 

"Do you usually pay social visits carrying a brief case?" 

"Now, wait a minute," he protested. "Don t write down the 
answer until I think." 

I stopped typing on his office machine which he had per 
mitted me to use to take verbatim notes of the interview and 
waited while he thought. After a lengthy silence I added: 

"You had a brief case on Thursday when you visited him." 

He continued thinking for a little longer and then said that 
he thought he had had a brief case on that trip. 

"But why do you ask me that?" he demanded. "There was 
nothing in that brief case." 

"Sure there was. The brief case always contains reports you 
send back to Germany and instructions from Germany are 
brought to you by Captain Trauernicht as well as other captains 
of German ships docking here and in San Diego." 

"I have never taken off propaganda nor given nor received 
reports," Schwinn insisted. "Somebody told you something and 
you ve got it all wrong." 

"Suppose I mention a few instances. At four o clock on Mon 
day afternoon, March 9, 1936, your beer-drinking friend, Captain 
Trauernicht, waited for you at the gangplank of his boat for 
your social visit. What he wanted was the package of sealed re 
ports from Nazi agents throughout the United States which you 
were bringing in your brief case. In due time you arrived and 
gave him the reports. Then you started on a drinking spree" 

"I don t know what you re talking about," Schwinn inter 
rupted. 

"Maybe I can refresh your memory. That was the evening the 
Captain took a lady from Beverly Hills, to the first mate s cabin 



96 SECRET ARMIES 

remember? You know, the lady who lives on North Crescent 
Driveshall I mention her name?" 

Schwinn s face turned an apoplectic red and he became quiet. 

"On Monday, February 10, 1936," I continued. "Reinhold 
Kusche, leader of the O. D. unit in your organization and a 
patriotic naturalized American citizen, was on board the 
steamer Elbe docked in Los Angeles harbor. He telephoned to 
one of your Nazi agents, Albert Voigt, that the Captain was sail 
ing at five o clock for Antwerp and was furious because the 
agents reports had not yet been delivered to him. Kusche told 
Voigt to bring the reports in a hurry which Voigt promptly did. 

"On Tuesday evening, May 12, 1936, the Captain of the Nazi 
ship Schwaben , which had just arrived from Antwerp, Belgium, 
came to your office and handed you a sealed package of orders 
and propaganda. He laid it on your desk in this room. The 
package contained copies of World Service "which is obtainable, 
you remember, only by subscription at a dollar and a half a 
year." 

"It is not true" Schwinn interrupted excitedly. 

"I have a copy from the batch he brought to you. But let s 
continue. On Monday, June 8, 1936, you yourself went to the 
Nazi ship Weser and gave the captain secret reports to take back 
to Germany and left with secret orders he had brought over- 
orders sealed in brown, manila paper* and a large package of 
Fichte-Bund propaganda. I have a copy from that batch, too." 

Schwinn stared at me and then smiled. "You can t prove 
anything," he said with assurance. 

"I have affidavits about all these items and more affidavits 
from men on board the Nazi ships." 

"It s impossible!" he exclaimed. "No German on the ship 
would dare to sign an affidavit!" 

"But I have them," I repeated. 

* During the trial of the four Nazi spies in New York the Federal prosecutor 
brought out that they also carried orders sealed in brown, manila paper. 



NAZI SPIES AND AMERICAN "PATRIOTS" 97 

"You intend to publish them?" he asked, a cunning look ap 
pearing in his eyes. 

His eagerness to discover who had given me affidavits was 
funny and I laughed. "I ll publish the information contained in 
them," I explained. "The names of the signers will be given 
only to an American governmental or judicial body which may 
look into your patriotic activities. But let s get on. Do you 
know the Nazi Consul in Los Angeles Dr. George Gyssling?" 

He sat silently for a moment as if hesitating whether to speak. 

"Don t be afraid to talk," I said. "The Consul isn t. You 
know, of course, that he does not like you?" 

A deep red flush suffused his face. "It s mutuall" he said. "I 
know he talks" 

Throughout the interview Schwinn tried almost pathetically, 
despite his obvious dislike of Gyssling, to cover up the Consul s 
interference in American affairs. When I told Schwinn I had 
affidavits showing that Rafael Demmler, President of the Steuben 
Society of Los Angeles, got two hundred dollars in April, 1936, 
from the Nazi Consul to help maintain the Deutsches Haus as a 
center of Nazi propaganda, he shook his head bewilderedly; and 
when I pointed out that he himself got one hundred and forty- 
five dollars in cash from the Nazi Consul on Tuesday, April 28, 
1936, to cover expenses incurred by Schwinn in the effort to bring 
the German-American groups together for the better dissemina 
tion of Nazi propaganda, his face turned alternately white and 
red and finally he exploded: 

"Did Gyssling tell you that?" 

"I m not saying who told it to me. But let s get on with some 
of your other patriotic activities. On Thursday, June 18, 1936, 
you visited Captain Trauernicht in company with Count von 
Billow " 

For the first time since the interview began Schwinn sat up 
right in his chair as if I had struck him. All the other subjects 
had left him slightly disturbed but still with an obvious sense 



98 SECRET ARMIES 

that he was not on particularly dangerous ground. But at the 
mention of Von Billow s name a look of actual fear spread over 
his face. 

"On that day," I continued, "you and the Count went directly 
to the Captain s cabin where you handed over your reports" 

"What are you getting at?" Schwinn demanded sharply. 

"I m getting at the Count. What do you know about him?" 

"Nothing. I know nothing about him. I ve met him, that s all." 

"Have you ever visited his home at Point Loma,* San Diego?" 

Schwinn stared at me without answering. 

"Have you ever been there?" I repeated. 

"Yes," he said slowly. 

"Did you ever observe how, through his study windows, you 
could see almost everything going on at the American naval 



"I have nothing to say," Schwinn interrupted excitedly. 

Among the men sent here directly by Rudolf Hess, Hitler s 
right-hand man, is a former German-American businessman 
named Meyerhofer. This Nazi came here with special instruc 
tions from Hess, a personal friend of his, to reorganize the Nazi 
machine in the United States. He arrived early in 1935 posing 
as a businessman. After consultations with Nazi leaders in New 
York, including the Nazi Consul General, he went to Detroit to 
confer with Fritz Kuhn,-)- national head of the German-American 
Bund. From Detroit he went to Chicago where he held more 
conferences with Nazi agents and then went directly to Los An 
geles for conferences with Schwinn, Von Biilow and other secret 
agents operating in the United States. Meyerhofer s mission was 
not only to reorganize the propaganda machine but to try to 
place it on a self-supporting basis so that in the event of war 

* Von Bulow has since sold his home and moved into the El Cortez Hotel 
in San Diego. 
f At that time working for Henry Ford. 



NAZI SPIES AND AMERICAN "PATRIOTS" 99 

when funds from Germany would be cut off, an efficient Nazi 
machine could continue functioning. 

It was with this knowledge in mind that I asked Schwinn what 
he knew about Meyerhofer. At the mention of his name the 
Nazi leader for the West Coast again showed a flash of fear. He 
hesitated a little longer than usual and then said in a low voice, 
"He is a member of our organization. He came from Germany 
about thirty or forty years ago." Suddenly he added, "He s an 
American citizen." 

"I know he s an American citizen. But are you sure he didn t 
come from Germany on his latest trip in January of last year?" 

Schwinn smiled a little wryly. "He might have," he said in the 
same low tone. 

"He s a personal friend of Rudolf Hess" 

"Listen!" Schwinn exclaimed. "You re on the wrong track!" 

"Maybe; but what s his business here?" 

"He s a businessman!" 

"What s his business?" 

Schwinn shrugged his shoulders. "I don t know," he said and 
then with growing excitement, "I tell you you re on the wrong 
trackl" 

"Then what are you so excited about?" 

"Because you re on the wrong track" 

"Okay. I m on the wrong track and you know nothing about 
Nazi spies. Do you know of the visits paid by the Japanese Con 
sul in Los Angeles to Nazi ships when they come into port and 
of his conferences with Nazi captains" 

"The Japanese! We have nothing to do with the Japanese. 
We are a patriotic group" 

"Yes, I know. What do you know about Schneeberger?" 

Schwinn answered with an "M-m-m-m." His jaw bones showed 
against the ruddy flesh of his cheeks. He stared up at the ceil 
ing. "He was a Tyrolian peasant boy," he said without looking 



100 SECRET ARMIES 

at me. "A boy traveling around the world; you know, just chisel 
ing his way around" 

"Just a bum, eh?" 

"That s it," he agreed quickly. "Just a bum." 

"What would your connections be with bums? Do you usually 
associate with Tyrolian bums who are chiseling their way around 
the world?" 

"Oh, he just came here like so many other people. He wanted 
money; so I gave him a little help and he went to San Fran 
cisco and Oakland. He vanished. I haven t any idea where he 
might be now. Maybe he s in Chicago now." 

"He couldn t possibly be in Japan now, could he?" 

"He spoke of going to Japan," Schwinn admitted. 

"You saw him off on a Japanese training ship which the Jap 
anese Government sent here from the Canal Zone, didn t you?" 

"I don t know," he said defiantly. "I know nothing about 
him." 

"The treaty between Japan and Germany providing for ex 
change of information about Communists was signed November 
25, 1936. But in September, 1936, Schneeberger told you he was 
leaving on a Japanese training ship for Japan. No training ship 
was expected on the West Coast at that time by the United 
States port authorities, and yet a Japanese training ship appeared 
ordered here from the Canal Zone. It was on this ship that 
Schneeberger left. Apparently, then, the Nazis and the Japanese 
had already been working together and you were cooperating 
because you took Schneeberger around. You took him to Count 
von Biilow s home at Point Loma, overlooking the American 
naval base. You know that Schneeberger was not broke because 
he was spending money freely" 

"He was broke," Schwinn interrupted weakly. 

"If he was so broke, how do you account for his carrying 
around an expensive camera and always having plenty of film 
with which to photograph American naval and military spots?" 



NAZI SPIES AND AMERICAN "PATRIOTS" 101 

"I don t know. Maybe he carried the camera around to hock 
in case he went broke." 

The absurdity of the excuse was so patent that I laughed. 
Schwinn smiled a little. 

"All right. What do you know about a man named Maeder?" 

Again that long, drawn-out "M-m-m-m." A long pause and 
Schwinn said, "Maeder is an American citizen, I believe." 

"Yes; you are, too. But what s his business in this country?" 

"I don t know," Schwinn said helplessly. "I really don t know." 

"You know nothing about his activities or observations of 
American naval and military bases? Do you usually take in 
members without knowing anything about them?" 

"Sometimes we do and sometimes we do not" 

"But orders were sent from Germany to make this an Ameri 
can organization" 

Schwinn nodded without admitting it verbally. 

"And since you throw out all Germans who are not Ameri 
can citizens, you check with the Consul General in New York 
as to whether they are fit" 

"We have nothing to do with the Consul General" 

"What happened to Willi Sachse who used to be a member 
here?" 

"He is supposed to have gone back to Germany." 

"Have you heard from him from Germany?" 

"No; I haven t heard since he left." 

"You received a letter recently from him from San Francisco 
where he is watching foreign vessels" 

"Oh," said Schwinn, raising his hands in a helpless gesture, 
"I know you have spies in my organization." 

We talked a little longer of visits he made to Nazi agents in 
the Middle West and in New York, of secret conferences with 
propagandists and spies. But he refused to do any more than 
shrug his shoulders at all new questions. 

"I have said too much already," he said. 



o 



VIII 

Henry Ford and Secret Nazi Activities 

NE OF THE CHIEF NAZI propagandists in the United States 
recently ran in the United States Senate primaries in Kan 
sas and was almost nominated. He is Gerald B. Winrod, who 
poses as a Protestant minister but has no affiliations with any 
reputable church. 

Winrod, even before he tried to get into the Senate, was one 
of the most brazen of the Nazis Fifth Column operating in this 
country. He has held secret consultations with officials in the 
German Embassy in Washington and carries on his propaganda 
under Fritz Kuhn s direction. 

Shortly after Winrod returned from a mysterious trip to Ger 
many and held an equally mysterious long consultation at the 
Nazi Embassy in this country (1935), he organized the Capitol 
News and Feature Service, with offices at 209 Kellogg Building, 
Washington. The "news service" supplied smaller papers 
throughout the land with "impartial comments" on the national 
scene. The Service was edited by Dan Gilbert, a San Diego news 
paperman, and the material was sent free of charge (as is the 
material sent to the Latin American countries from Germany 
and Italy) . It was of course, deliberately calculated to spread 
pro-Hitler sentiment and propaganda. 

Few who read Winrod s publications realize the extent of 
his activities. On March i, 1937, Senator Joseph T. Robinson 
addressed the United States Senate on what appeared to him to 
be "unfair propaganda" carried on by Winrod against President 

102 



HENRY FORD AND SECRET NAZI ACTIVITIES 103 

Roosevelt s proposed reorganization of the judiciary system. The 
Senator stated that he could not understand why the issues 
should be deliberately falsified by a gentleman of the cloth 
that it reminded him of the old Ku Klux Klan tactics. 

The Senator did not know that Winrod s propaganda against 
Roosevelt was only part of a propaganda campaign cunningly 
and brazenly organized by Nazis in this country in an effort to 
defeat a man who, they felt, was not friendly to them. In this 
campaign, Nazi agents worked openly and secretly with a few 
unscrupulous members of the Republican Party in an effort 
to defeat Roosevelt. 

Several years ago Winrod was a poverty-stricken man living 
at 145 N. Green Street, Wichita, Kansas. He called himself a 
minister but all church bodies have repudiated him. Without 
a church, he did a little evangelistic preaching and lived off 
collections made from his audience. It was a precarious liveli 
hood and often the "Reverend" did not have enough money to 
buy even ordinary necessities. 

Records in several Wichita department stores tell the story 
of the evangelist s poverty before an angel came to visit him. 
All the storekeepers with whom Winrod dealt requested that 
their names be withheld, but signified their willingness to present 
their records to any governmental body which might be inter 
ested in the sudden wealth he acquired after he became an 
intense Hitler propagandist. In the days of his poverty Winrod, 
the records show, could afford to buy only the cheapest furni 
ture, the cheapest clothes, and pay for them on the installment 
plan in weekly payments ranging from fifty cents to two or 
three dollars a week. 

I am reproducing with this chapter several of the installment 
cards. The reader will notice that as late as 1934 Winrod was 
paying at the rate of one dollar a week. It was in this period 
that Nazi agents in the United States were carrying on their 
intensive campaign, and it was also in this period that Winrod 



104 



SECRET ARMIES 



began to harangue his audiences about the "menace of the Jews 
and the Catholics-." 

Then one day, the Reverend Gerald B. Winrod suddenly 
found himself possessed of enough money to go to Germany. 




Account cards for the Reverend Gerald B. Winrod in a Wichita department 
store, showing his straitened financial circumstances during the early thirties. 

When he came back in February, 1935, he had new suit cases, 
new clothes and a fat check book. The records in the Wichita 
department stores where he had been getting credit for clothes 
and furniture show that after his return from Germany he paid 
all his debts in lump sums by check. Then he became a pub 
lisher. 

In his newspaper, The Revealer, he published a report on his 
trip to Europe, but did not mention where he got the money 
for the jaunt. The report (February 15, 1935) told of his dis 
covery that the German people loved Hitler and that only "Jew 
ish influence in high circles of certain governments is making it 



HENRY FORD AND SECRET NAZI ACTIVITIES 105 

impossible for Germany to carry on normal trade and financial 
relations with other countries." 

In this period of his new-found prosperity he established con 
tacts with Nazi agents and pro-fascists like Harry A. Jung of 
the American Vigilant Intelligence Federation, Colonel Edwin 
Emerson, James True and a host of other patrioteers. 

Before the Presidential election he made another trip to 
Germany. When he returned, he enlarged his distribution ap 
paratus and was apparently important enough for high Nazi 
officials visiting the United States to meet with him. One of 
these was Hans von Reitenkranz, who came quietly to the United 
States as Hitler s personal representative to arrange for oil pur 
chasesoil which Germany needed badly for her factories and 
especially for her growing war machine. 

Von Reitenkranz is a friend of Professor Kurt Sepmeier of 
the University of Wichita. He introduced Winrod to the Pro 
fessor. They became friendly. When I was in Wichita making 
inquiries about the Reverend Winrod, I constantly came across 
the Professor s trail. Both he and Winrod had been meeting 
regularly but with an effort at secrecy. 

In January, 1937, after several meetings with Professor Sep 
meier, Winrod went to Washington. I also went to Washington 
and found that the Reverend was calling at the German Em 
bassy. On one of his visits he remained inside for an hour and 
eighteen minutes. Whom he saw or what he discussed I do not 
know; but immediately after this long visit, the News and Fea 
ture Service was organized with money enough to send its items 
out free of charge to the papers that would accept them. 

Gilbert, who headed the Service, was for many years the per 
sonal representative of William Dudley Pelley, leader of the 
Silver Shirts. The Nazis had been trying to get the Silver Shirts 
to cooperate with them in a fascist "united front" and the 



106 



SECRET ARMIES 




PRESENTS Ready to be .Distributed; Washington is once more a tcene 
of bustling activity. Apartment houses and hotels are crowded to cap*-" 
city. Congressmen, Senators, their wives, families, and secretarial 
help, are pouring in from every part of the country. 

The President comes bearing gifts. For weeks, he and his helpert 
have been preparing presents for distribution to members of the House 
and Senate. It win be some time, however, before the nation s duly 
elected representatives learn of all they have in their stockings* 
His message on the state of the Union probably gives only a hint. 

Disclosures from nources cle*s to the inner sanctum of the White 
House, reveal that the. dear public will do well to brace Itself for 
some unique thrillo and shocks. New legislative measures, heretofore 
unknown to the American people, are on the way. 

On the evening of November 3rd, when it was definitely known that 
the President had been reelected. he said from the front porch of hi0 
home at Hyde Parlct "I am going back to Washington. During the Joyoua 
Christmas eeaaon. 1 shall be preparing gift* for the next CongreM,* 



HOW Much? 
field of the 7 
lief money. 

When the 
be required. a 
fire from ceve 



Morning Mr. Editor! 

in* article*. 



10 battle- 
ng of 



.000 woull; 
. he drew 



r stand 




Sample of the "Capital News and Feature Service," in the establishment and 
distribution of which the Reverend Gerald B. Winrod had a. hand. 



appointment of Gilbert was the first indication that a friendly 
cooperation had been established. 

Winrod had been in constant communication with Pelley, and 
Pelley had conferred several times with Schwinn. The Nazis were 
eager to get a native American body into the organization so 
they would have an American "front." 

Gilbert opened offices in Washington and, fearful lest their 



HENRY FORD AND SECRET NAZI ACTIVITIES 107 

fje $Btington Brings Snbepenbint 

C. J. WBB. PUM.ISMKM 

rt*inctsm frpring*, ftottty 
January 19, 1937 



Capital News 5 Feature Service 
Ben Franklin Station 
Box 771 
Washington, D.C, 



Gentlemen:. 

We are in receipt of a service from you 
entitled "Inside News from the Eatioss Capital, 
by Dan Gilbert, which we do not recollect 
ordering. We wiah to know the source of thia 
service, if it is free, and why? We are running 
a Washington Service and of course would have to 
have some definite reason for changing, and if wt 
started to use yours we would want the assurance 
that it would come regularly, until advance notica 
was received to stop it. 



Respectfully, 
CJWtGB 



Letter from a small-town newspaper showing the kind of confusion caused by 
the "Capitol News and Feature Service." 




108 SECRET ARMIES 

location become known, rented Post Office Box No. 771, Ben 
Franklin Station, for use as a mailing address. After the first 
issue had been sent out, Winrod and his agents canvassed promi 
nent industrialists for donations to support the "news service" 
on the grounds that it was furthering religious activities and 
fighting Communism. The money collected was actually used to 
carry on anti-democratic propaganda. A number of industrialists 
contributed. I have a list of them, but since there is no con 
clusive evidence that they knew the money was being spent by 
Nazi agents, I shall not publish the names. I mention it merely 
as an illustration of how wealthy men are victimized by racket 
eers with pleas of "patriotism" and "public service." Harry A. 
Jung did the same thing by getting money from rich Jews "to 
fight Communism" and from rich gentiles "to fight the menace 
of the Jew." 

With the first issue of the Capitol News and Feature Service, 
the following announcement was mailed to the editors of rural 
weeklies: 

"Good Morning, Mr. Editor! Capitol News and Feature Service 
herewith delivers three priceless articles, fresh from the Nation s 
capitol. Use them without cost. You will hear from us each 
week. Watch for these interesting articles." 

An examination of the "priceless articles" showed that they 
were designed primarily to attack American democracy. 

Since his return from Germany and his conferences at the 
Nazi Embassy, Winrod has made frequent trips into Mexico 
where he has met with Mexican fascists especially with leaders 
of the Mexican Gold Shirts which were organized by Hermann 
Schwinn. Again we discover the tie-up between fascist organi 
zations in the United States and those to the south of us. 

When the Nazis reorganized their propaganda machine several 
years ago and established smuggling headquarters on the West 
Coast, propaganda taken off Nazi ships docking in San Diego 



HENRY FORD AND SECRET NAZI ACTIVITIES 109 

and Los Angeles included material printed in Spanish for the 
special use of General Nicholas Rodriguez, head of the Gold Shirts. 

The Spanish as well as the English material was taken to the 
Deutsches Haus in Los Angeles and turned over to Schwinn, 
who forwarded the batches to Rodriguez. The contact man 
between Schwinn and the head of the fascist movement in 
Mexico is a native American named Henry Douglas Allen of 
San Diego. Allen, under the pretext of being a mining engineer 
and interested in prospecting in Mexico, went repeatedly into 
the neighboring country with the smuggled propaganda and 
delivered it to Rodriguez agents. 

Since native Americans, especially if they say they wish to 
prospect, can travel across the international boundary into 
Mexico as often as they please without arousing suspicion, 
Allen was chosen as the liaison man between Nazi agents in the 
United States and Rodriguez. As I said earlier, the Nazis tried 
from the beginning to get an American "front" and to draw 
as many Americans into it as possible obviously strategic prepa 
ration for future work more serious than mere propaganda. 
Hence Allen was instructed to become active in the Silver Shirt 
movement. He organized Down Town Post No. 47-10 and 
established Silver Shirt recruiting headquarters in Room 693 
at 730 South Grand Ave., Los Angeles. 

In August, 1936, when a lot of Nazi and anti-Roosevelt money 
was being shelled out in efforts to defeat Roosevelt, Allen be 
came extremely active. While Pelley was out of town, he was 
instructed to work with Kenneth Alexander, Pelley s right-hand 
man. Alexander was formerly a still-photographer at United 
Artists Studios. The two opened offices in the Broadway Arcade 
Building and on October i, 1935, moved to the Lankersheino 
Building at Third Street near Spring, Los Angeles. 

Rodriguez, after he was given assurances of Nazi aid, worked 
not only with Nazi agents in this country but also with Julio 
Brunet, manager of the Ford factory in Mexico City. 



110 SECRET ARMIES 

The earliest documentary record I have of their tie-up is a 
letter Rodriguez wrote to Ford s manager on September 27, 1934, 
on Gold Shirt stationery. The letter merely asks Brunei to give 
jobs to two "worthy young men" and is written in a manner 
that shows Rodriguez and Brunet are rather close. 

By February 7, 1935, Rodriguez and the Ford executive in 
Mexico had become sufficiently intimate for the fascist leader 
to express his appreciation of Brunet s placing Gold Shirts in 
the plant. His letter addressed to the manager of the Ford 
Company follows: 

We have been informed by our delegate, Senora N. M. Colunga, that she 
was very well treated by you and that in addition you informed her that our 
request for work for some of our comrades who needed it has also been 
heard. Not doubting but that this will be fulfilled, A.R.M. [the Gold Shirts] 
sends you the most expressive thanks for having seen in you the recognition 
of one of the greatest obligations of humanity to Mexicanism. 

On November 19, 1935, shortly before the Gold Shirts felt 
they were powerful enough to attempt the overthrow of the 
Mexican Government and the establishment of a fascist dictator 
ship, Rodriguez wrote to the manager of the Ford plant, asking 
for the two ambulances which had been promised the fascists 
by the Ford manager. Rodriguez had organized his attempted 
Putsch carefully, with a women s ambulance corps to care for 
the wounded in the expected fighting. The letter, again trans 
lated almost literally, follows: 

Sr. Manager of the Ford Company Nov - X 9 ^SS- 

City 

Highly Esteemed Senor: 

This will be delivered to you personally by Sr. General Juan Alvarez C., 
who comes with the object of ascertaining if that company would be able to 
supply two ambulances which they had already offered, for the transportation 
of the Women s Sanitary Brigade on the aoth day of this month at 8 A.M. 

Thanking you in advance for the references, I am happy to repeat that I 
am at your command. Affectionately and attentively, S. S. 

NICHOLAS RODRIGUEZ C. 
Supreme Commander. 



HENRY FORD AND SECRET NAZI ACTIVITIES 111 



3e la aaca ttia espe 
cial rconda4i<5zu 



Mbr 

JULIO BBl 

Garente da los Tallarea "Ford 

Colon! n Indue trial 9 D* ? 



ttuy afltlmado y flno Xugeniero y ami go: 



Tengo ferdadero gustfr en praaontar a usted per 
taedlo de sta a IOB j^tonewa floaa Adolf o y don Gilberto Cautaito- 
da anbos rauy apraciablesB, bijos do tta fntioo aalgo ofo. Los 
idrenefi Castofieda aa*4ip*ofi da encontrar uuevos horlaontfta qua 
lea eyudan a solucioaar la cot Id! ana lucha por la vida, haa 
aeodido a af en domajoda da eyuda > y siendo ellofi por todos no* 
tlvos dlgnoa N ds logra? 0u nuble aspirocidn* yo no peroito do 
la oanera mds atonta rcomendarlO3 a las finaa atenclonea de 
t ted, para que si a blen lo tlene se sirra inpartirlea su Ta 
ll osa ayuda daudoles dpoxtuoldad da que trabajen en esa 
tante plant a industrial. 



Uuy obligado <judar4 con ttated I i slrro atec- 
dar la preaente sdpllca por lo que unticlpadamontci le 
Bit 



>uyo muy ftfec^uosafflantft sarrldor y 




Ofieiaas da A.B.H.* ^ 27 da aeptiaabra 4e 1934. 

Letter from General Nicholas Rodriguez, Mexican fascist leader, to the Ford 
manager in Mexico City, soliciting employment for two prote"g6s. 

In the street fighting that followed the attempted fascist 
Putsch a number were killed and wounded. It was after this 
fight that Rodriguez was exiled. 

I am reproducing some of these letters from carbon copies, 
initialed by Rodriguez, which were in his files. Why he initials 



112 SECRET ARMIES 

carbon copies I don t know, but I have a stack of his corres 
pondence with Nazi agents and almost all of his carbons are 
initialed. 

On October 4, 1936, Allen wrote to the exiled fascist leader. 
Ostensibly the letter invited him to address the Silver Shirts. Ac 
tually it was for a special conference about "matters of vital 
importance to us both." This letter was written when Schwinn 
was holding conferences with Pelley to merge forces in a fascist 
united front, and when Schneeberger was preparing to leave 
for Japan on a training ship ordered up from the Canal Zone 
by the Japanese to take him on board. The letter follows: 

Dear General Rodriguez: 

Upon receipt of this letter will you kindly communicate with me and 
advise me whether it would be possible for you to come to Los Angeles in 
the near future to make an address to our organization here. We shall be 
glad to defray all expenses which will include airplane both ways if you 
desire it. We shall also offer you bodyguard for your protection if you deem 
it necessary. Your fight is our fight and it is our desire to have you come to 
Los Angeles especially to confer with us relative to matters of vital im 
portance to us both. I would suggest that if you can arrange to come, you 
telegraph me (charges collect) upon receipt of this letter so that I may make 
arrangements without delay. 

Fraternally yours, 

HENRY ALLEN. 

When I went to Mexico to look into Nazi activities, I gave 
a copy of this letter to the Minister of the Interior. At that time 
Allen was again in Mexico under the pretense of looking into 
his mining interests, but a check showed that he had actually 
gone there to confer secretly with a Mexican army man, General 
Iturbe. At my request the Mexican Government looked into 
Allen s movements and learned that he had entered Guaymas, 
center of Japanese activities, with Kenneth Alexander, Pelley s 
chief aid. 

The connection between Ford s Mexican manager and General 



HENRY FORD AND SECRET NAZI ACTIVITIES 1 1 3 



novleabre 19 de 



Sr, Oerente de la Cla. PCRD. 
C 1 u d a d. " " 



Senor de ail repoeto: 

La present* le sera entregad* 

por el 3r. General JU K ALVAREZ C.. qulen v* con 
to de saber si esa Compania podra facllltar dos aabalan 
olas que ya con antlolpaclon bablan ofrecldo, con objeto- 
del trsnaporte de la Brigada Sanitaria Feaenil el dla 20* 
del actual las 8 a. a. 

Antlclpandole las graolas por el favor de reft 
renola, me et> grato repetlrae a sus ordenes coao su *fao. 
<stto. j 3.3. 



WIOOLA3 RODRIGOS2 C. 
Jefe Supreao* 



8ttt*tarlo Otacrtl 



LDCIO 0. VEFDIOOEL. 



Letter from General Rodriguez to the Ford manager in Mexico City. The trans 
lation is given on page no. 



114 SECRET ARMIES 

Rodriguez might be considered an unfortunate incident for which 
Ford could not be held responsible. This would be a reason 
able assumption if the Nazi-Rodriguez-Ford tie-up in Mexico 
were an isolated case. The facts, however, show it is not. 

The national leader of the Nazi propaganda machine in this 
country has been on the Ford pay roll. Kuhn was supposed 
to work for Ford as a chemist, but while on Ford s pay roll he 
traveled around the United States conferring with other secret 
Nazi agents and actively directing Nazi work in this country. 

Ford has a highly developed and exceedingly efficient espion 
age system of his own which, among other things, watches what 
his employees do even to their home life. Kuhn s activities were 
known to Harry Bennett, head of the Ford secret service or 
"Personnel Department," as it is called, and Bennett reports to 
Ford. Furthermore, Kuhn s Nazi connections had been pub 
licized in both the American and the Nazi press and were no 
secret. Jews and Christians alike protested to Ford about his 
employee s anti-democratic work while on the motor magnate s 
pay roll, but Kuhn was left undisturbed to travel around organ 
izing Nazi groups. In 1938 Ford was given the highest medal of 
honor which Hitler can give to a foreigner. No statement was 
ever made as to just what Henry Ford had done for the Nazi 
Fuhrer to merit the honor. 

Simultaneously with Kuhn s intensified work, Ford s confi 
dential secretary, William J. Cameron, became active again. 
Cameron was editor of Ford s Dearborn Independent when that 
newspaper published the "Protocols of the Elders of Zion" after 
they had been proved to be forgeries. When a nation-wide pro 
test arose from Jews and Christians who were shocked at seeing 
one of the richest and most powerful men in the country use 
his wealth to disseminate race hatred, and when the protest 
grew into a boycott of his cars, Ford apologized and discontinued 



HENRY FORD AND SECRET NAZI ACTIVITIES 115 



O S>0t HI DOU * 




The Silv Battalion 



General Nicholas Rodriguez, 
El Paso. Texas. 



October 4 . 1936 



Dear General Roderiguez: 

Upon receipt of this letter 

will you kindly comrmmicate with me and advise me whether 
it would be possible for you to come to Los Angeles in 
the near future to make an address to our organization 
here. We shall be gled to defray all. expenses which 
will include aero-plan both way* if you desire it. Wo 
shall also offer you body guard for your protection if 
you deem it necessary. Your fight is our fight and it 
Is our desire to have you come to Los Angeles especially 
to confer- with us relative to matters of vital importance 
to us both. I would suggest that if you can arrange to 
come, that you telegraph me (charges collect) upon receipt 
of this letter so that 1 may make arrangements without 
delay. 

Fraternally yours. 

A/p K 




Letter from Henry Allen to General Rodriguez, showing the tie-up between 
American and Mexican fascist organizations. 



116 SECRET ARMIES 

the newspaper. But instead of easing his editor out or giving 
him some other job, he made him his confidential secretary. 

When Kuhn went to work for Ford, the national headquarters 
of the Nazi propaganda machine was moved to Detroit, and the 
anti-democratic activities increased in intensity. Employing Nazi 
anti-semitism as the bait to attract dissatisfied and bewildered 
elements in the population, a new organization made its appear 
ance: The Anglo-Saxon Federation, headed by Ford s private 
secretary. Headquarters were established in the McCormick 
Building in Chicago, Room 834, at 332 S. Michigan Ave. and in 
the Fox Building in Detroit. 

In July, 1936, Cameron, obviously because Ford was violently 
anti-Roosevelt, stepped out as head of the organization and 
became its Director of Publications. When Winrod was raising 
money from American industrialists to support the Capitol 
News and Feature Service, Cameron was among the contributors. 

The Anglo-Saxon Federation began to distribute the "Proto 
cols" again. I bought a copy in the Detroit offices of the organi 
zation, stamped with the name of the organization. The intro 
duction quotes Ford as approving of them. It states: 

Mr. Henry Ford, in an interview published in the New York World; 
February 17, 1921, put the case for Nilus* tersely and convincingly thus: 

"The only statement I care to make about the Protocols is that they fit in 
with what is going on. They are sixteen years old, and they have fitted the 
world situation up to this time. They fit it now." 

When Ford was on the witness stand in a libel suit some 
fifteen years ago and admitted his ignorance of matters with 
which even grammar school children are familiar, the country 
laughed. His ignorance, however, is his own affair, but when he 
takes no step to curb his personal representative from working 
with secret foreign agents to undermine a friendly government, 

* The man who forged the "Protocols" originally and who subsequently 
confessed to having done so. 



HENRY FORD AND SECRET NAZI ACTIVITIES 



117 



Help Save America! 




Don t Buy From JEWS! 



HENRY* FORD 

3)ec 

intonation^ 
JuOe 





LEFT: American -made anti-Semitic sticker of a type appearing with increasing 
frequency in recent times. RIGHT: Title-page of the German edition of "The 
International Jew," by Henry Ford, of which 100,000 copies have been dis 
tributed. 

it becomes a matter, it appears to me, of importance to the 
people of this country and the Government of the United States. 



IX 

Nazi Agents in American Universities 

THE UNIVERSITIES ARE TOO IMPORTANT A TRAINING GROUND for 
Nazi agents to ignore. A few professors in some of our uni 
versities have joined the growing list of anti-democratic propa 
gandists. Some of them are German subjects and do not dis 
guise their pro-Nazi bias; others carry on their propaganda as a 
"scholarly analysis" of the Hitler regime with a fervor, how 
ever, that smacks of the paid propagandist. 

German exchange students, too, studying at some of our uni 
versities, are active in various efforts to draw native Americans 
within the sphere of Nazi influence. Some of these students 
came here ostensibly to study for degrees, but devote most of 
their time to spreading Nazi ideology and meeting with secret 
Nazi agents and military spies. Such was Prince von Lippe of 
the University of Southern California. 

Von Lippe is not an American citizen as so many of the agents 
are. With no visible means of support, he received expenses 
from a total stranger oddly enough, Count von Billow whose 
home overlooked the naval base in San Diego and who was 
constantly in conferences with Nazi agents. It was to Count von 
Bulow, you recall, that Hermann Schwinn brought Schnee- 
berger as soon as he arrived on his way to Japan, and von 
Biilow took him around while Schneeberger photographed areas 
in the military and naval zone. A number of very secret con 
ferences were held while Schneeberger was on the West Coast, 
in the home of Dr. K. Burchardi, a Los Angeles physician who 

118 



NAZI AGENTS IN AMERICAN UNIVERSITIES 119 

visits Nazi ships with Schwinn and von Bulow (on one occasion 
Schneeberger summoned Burchardi to come with him to a Nazi 
ship which had just docked in Los Angeles and the physician 
dropped his work and went) . 

German exchange students, when they enter this country, are 
under instructions to report to the German-American Bund. On 
July 4, 1936, three exchange students a young lady and two 
young men entered Los Angeles while on a motor tour of the 
country. They were students at Georgia Tech. In Los Angeles 
they went directly to the Deutsches Haus and presented a letter 
of introduction to Hermann Schwinn who assigned them quarters 
at the home of Max Edgan, one of Schwinn s lieutenants. The 
students then made a detailed report to Schwinn on the political 
work they were carrying out at Georgia Tech. 

But the professors are the chief hope of Nazi agents attempt 
ing to spread the idea of totalitarian government and a bit of 
race hatred as the bait to attract some elements in the popula 
tion. Some of the professors and some of their activities follow 
briefly: 

Professor Frederick E. Auhagen, formerly of the German De 
partment, Seth Low Junior College, Columbia University. 

Dr. Auhagen came to this country in 1923 and worked as a 
mining engineer in Pennsylvania. From 1925 to 1927 he was 
with the Foreign Department of the Equitable Trust Co.; then 
became connected with Columbia University in 1927. He is not 
an American citizen and constantly refers to Germany as "my 
native country." 

This professor is one of the leading academic apologists for 
Herr Hitler in the United States. Besides carrying on his pro- 
Nazi propaganda in the classroom, he does a great deal of lectur 
ing, sometimes appearing before the Foreign Policy Association. 
On one occasion, in an address before the Men s Club of the 
Baptist Church at Rockville, Long Island, he stated that Seth 



120 SECRET ARMIES 

Low Junior College was opened "in order to keep Hebrew 
faces off the campus at Columbia University." 

Auhagen never tried to hide his sympathies with Nazism. 
Preceding a debate on February i, 1936, before the City Club 
of Cleveland, he gave press interviews as a Nazi, and in the 
debate upheld Hitler as the savior of Germany and world civili 
zation. With a fervor far removed from professorial calm, he 
explained that American newspaper dispatches about the treat 
ment of Jews and Catholics in Germany were exaggerated. 

"As to criticism of Germany s treatment of Catholics," he said 
again in Denver, Colorado on July 26, 1935, "that is not truel" 

Professor Frederick K. Krueger, of Wittenberg college, with 
whom Auhagen is rather closely identified in arranging and 
giving talks about Nazis and totalitarian government, at every 
opportunity issues press interviews along the same line. In them 
he explains that the anti-Nazi sentiment in the United States 
press does not represent the editors, but is dictated by Jews who 
"control the press, the motion pictures and other organs of 
public opinion." 

Because of the high scientific standing of Professor Vladimir 
Karapetoff of the Cornell engineering faculty, he is listened to 
with more attention and respect than are the more blatant 
propagandists for the adoption of fascist tactics and principles. 
Shortly after Hitler took power, the Professor started to do his 
share on the campus. At first he did it subtly, but when this 
made little headway he began to talk of the "growing domina 
tion of Jews in American life, politically as well as economically" 
and emphasized that the large number of Jews in the Law School 
and on the campus generally was becoming a problem. 

"It s the smooth-faced Jew whom we must fear," he kept 
repeating, "and not the long-bearded Jewish rabbi." 

Not content with expressing personal opinions, he took to 



NAZI AGENTS IN AMERICAN UNIVERSITIES 121 

organizing groups, addressing them on the subject of the Jew; 
and on one occasion he called a special meeting of the Officer s 
Club with the proviso that Jews be excluded. 

Paul F. Douglas,* teacher of German, Economics and Political 
Science at Green Mountain College, wrote a book, God Among 
the Germans, which purports to be an introduction to the mind 
and method of Nazism. 

I have information coming from a reputable source that Dr. 
Douglas was paid by the Nazi Government to write the book. 
This source is unwilling to let his name be used, but is ready 
to testify and lay his information before any governmental body 
which will investigate the devious methods of Nazi agents in 
this country. 

There are at various universities throughout the country 
other professors and instructors quite active in spreading pro- 
Hitler propaganda. Some of them meet with Nazi agents closely 
allied to the espionage machine. I offer only these few as illus 
trations of Nazi efforts to get footholds in the American 
universities. 

Along with efforts to carry on their work in the universities, 
Nazi agents tried to get a foothold in the political life of the 
country by finding a few Republicans who were willing to use 
anti-democratic propaganda in their efforts to defeat Roosevelt 
during the Presidential campaign. At no time in American his 
tory did secret agents of a foreign power so brazenly attempt 
to interfere in the internal affairs of the American people. Nor 
at any time in American history did agents of a foreign govern 
ment find such willing cooperation from unscrupulous American 
politicians. 



* Not to be confused with Prof. Paul H. Douglas of the University c- 
Chicago, a highly reputable scholar and a stanch defender of democracy. 



122 SECRET ARMIES 

Among those who worked with Hitler agents was Newton 
Jenkins, director of the Coughlin-Lemke Third Party.* The 
Detroit Priest and the Congressman were fully aware, preceding 
and during the campaign, that Jenkins supported Hitler and 
was a Jew-baiter of the first order. They were aware of this while 
they were appealing for Jewish votes. The Radio Priest and 
the Congressman kept in constant touch with their campaign 
manager and knew what sort of government Jenkins wanted. 

Jenkins association with Nazis dates to the days preceding 
the launching of the Presidential campaign. At that time he 
participated in a secret conference held in Chicago with the 
object of uniting the scattered fascist forces in the United States 
to form a powerful fascist united front. Among those who 
attended where Walter Kappe, Fritz Gissibl and Zahn three 
active Hitler agents assigned to the Mid-West area; William 
Dudley Pelley, leader of the Silver Shirts; Harry A. Jung, the 
ultra-"patriot"; George W. Christians of Chattanooga, Tenn., 
head of the American fascists; and several others. The con 
ference ended with an agreement to support a Third-Party 
movement directed by Jenkins. 

Throughout the campaign Jenkins stressed an exaggerated 
nationalism, advocated "party patrols" similar to Hitler s storm 
troops and adopted the Nazi Jew-baiting tactics. His first public 
appearance with the Nazis was on October 30, 1935, at a meeting 
held in Lincoln Turner Hall, 1005 Diversey Building, Chicago. 
Uniformed storm troopers with the swastika on their arm bands 
patrolled the room. In the course of his talk he said: 

The trouble with this country now is due to the money powers and Jewish 
politicians who control our Government. The Federal Treasury is being con 
trolled by a Jew, Morgenthau, and a Jew, Eugene Meyer. The State, County 
and our own Municipal Government is being controlled by Jewish politicians. 
Our own Mayor signs what the Jews want him to sign. Nearly in every 

* Father Coughlin was finally reprimanded by the Vatican for his unpriestly 
attacks upon the President. 



NAZI AGENTS IN AMERICAN UNIVERSITIES 123 

department of our country and local government you will find a Jew at the 
head of it. Not only under a Democratic administration but also under a 
Republican administration we will find the same conditions. . . . The 
American people must free itself from the money plunderers who have 
thrown this country into the World War and also a possibility of dragging 
them into the present war for private gain and shake off their shoulders the 
Jewish politicians. The Third Party promises to do both. 

This is precisely the sort of stuff paid Nazi agents in the 
propaganda division are ordered to disseminate, and this is the 
man Father Coughlin and Congressman Lemke picked to direct 
their campaign. 

It was a Nazi agent, Ernst Goerner of Milwaukee, who spread 
the story, aided by anti-Roosevelt forces, that Frances Perkins, 
Secretary of Labor, was a Jewess. The story received such wide 
publicity that she had to issue a public statement giving her 
birth and marriage records. 

Goerner is one of the important Nazi agents in the Mid-West. 
He s a bit eccentric and the Nazis sometimes have difficulty 
keeping him in line, but when Schwinn made a trip East shortly 
before the election campaign, he stopped off specially to see 
Goerner who thereupon sent a flood of propaganda throughout 
the country about Secretary Perkins ancestry as well as charges 
that Roosevelt and almost all Government officials were Jews. 

It was after Schwinn s trip to the East that other disseminators 
of anti-democratic propaganda, like Robert Edward Edmondson 
and James True, came to life in a big way. One of the penni 
less men who suddenly blossomed into the money after Schwinn s 
trip East was Olov E. Tietzow, who used Post Office Box No. 
491 in Chicago lest the fact that he lived at 715 Aldine Ave. be 
discovered. 

Up until a few months before the campaign Tietzow was an 
unemployed electrical engineer who had difficulty paying the 



124 SECRET ARMIES 

three-dollar weekly rent for his hall bed-room at the Aldine 
Ave. address. After Schwinn s visit and meeting with him, 
Tietzow began to commute by air between Chicago and Buffalo 
where he opened a branch office. 

Tietzow was tested out a little at first. He was put to work 
in the offices of the Friends of the New Germany on Western 
Ave. and Roscoe St., Chicago. In his spare time he worked out 
of 1454 Foster Ave., Chicago. A quotation or two from some 
of his letters will give an indication of his activities. On Febru 
ary 21, 1936, he wrote to William Stern, Fargo, N. D., a member 
of the Republican National Committee. He said in part: 

Information about the so-called fascist movement here in the U. S. A. will 
be furnished by me if you so desire, together with other data you might be 
interested in. An opportunity to discuss our national problems and to lay 
before patriotic persons of means and influence and before national organiza 
tions my plans for a nationwide movement would be welcome. . . . 

This letter to a high Republican Party official was written 
after Tietzow had outlined the contents to Toni Mueller, Nazi 
agent in Chicago reporting directly to Fritz Kuhn. 

Since most of the patrioteers were opposed to the New Deal 
and since some of them were already working with Nazi agents 
in this country, it was not long before they were going full blast 
in their "Save America" racket. The people of the United States, 
though they don t talk much about it, are thoroughly patriotic 
in the fullest sense of the word. To accuse anyone of not being 
a patriot is almost worse than telling a man that he is a son 
of not quite a lady. The racketeers in patriotism long ago dis 
covered that people would contribute to a "patriotic cause" if 
only to escape the reputation of being unpatriotic; and the 
racketeers have made a nice living out of it. For some of the 
patrioteers it has become a thriving business, with everybody 
involved except the suckers getting his cut. Some of the big 
"patriotic" organizations are really influential, and the small 



NAZI AGENTS IN AMERICAN UNIVERSITIES 



125 



- O.E.T. 

THE AMERICAN GUARD 




Mr. Wamor W. feareco, Architect, 
Rortb 4tfc hieo A*. ,-.- 
Chicago, Illinoi*, 



pear Ur. 

Reoeired your request for 1 iterator*. Proa tiae to time, paa- 
pfelets dealing with the Jewish-Oooaunistie problems will be sent to you. Extra 
copies of especially interesting ones will be sent to you with request tet 
you distribute tbea ejaong your frisndsj there is no charge for any of those 



ThA Am*rion (Kurd i now being organited by se in the tut 
of Illirv>ie and lUnneeoU, and Uter en the aotiwlUe* will be extended to.ot 
stated well. The purpose ! to help oounteraet the underaining Influence 
of Jews sjui ether edmainlsts,*nd to restore White rule here in AaerUa. Uo. 
bers of the orgejiiution do not, for the tiae being, pay any fees or dues; re* 
lianee is made entirely upon Toluntary contributions. - The asin activities 
now center upon distribution of educational propagand*! aotire participation. 
,in polities will start in * couple of months when, I hope, the organisation 
of thle psrty hss been complete^. 

Trusting that you will actively support the organi cation, I * 



P.O.Box 4$1, Chicago, Illinois 



Letter by Olov E. Tietzow, showing typical methods of American fascists. 



126 SECRET ARMIES 

ones are hopefully struggling along in the expectation of bigger 
and better and more patriotic days when the pickings will be 
more than attractive. 

Every time I start looking into organizations with high- 
sounding and impressive names, I am profoundly impressed 
with the accuracy of Barnum s noted observation. Raise the cry 
of "patriotism" and perfectly good Americans forget to try to 
find out just what the "patriotic" activities are, and shell out 
without a murmur. Industrialists particularly like the "Ameri 
canism" of the patriotic groups because almost all of them 
incorporate an anti-labor policy. The propaganda, of course, is 
rarely conducted as an open fight against labor, but is put across 
as a fight to save America from the Communists. 

Some of the racketeering patriotic organizations with a more 
or less devout following include the National Republican Pub 
lishing Company, Washington, D. C., the American Vigilant 
Intelligence Federation, Chicago, 111., the Paul Reveres, Chicago, 
111., the Industrial Defense Association, Boston, Mass., the Ameri 
can Nationalists, Inc., New York, N. Y. and the American Na 
tionalist Party, Los Angeles, Calif. There are a number of others, 
but these are some of the most blatant. 

The National Republican Company, 511 nth Street, N.W., 
Washington, D. C., is one of the most influential. It publishes 
the National Republic, a journal accepted by men high in public 
office and by leading industrialists as earnestly trying to incul 
cate "Americanism" into Americans. 

The National Republic has an amazing list of endorsers- 
governors, mayors, senators, congressmen and nationally-known 
industrialists. The magazine is virtually the entire organization 
and is dedicated "to defending American ideals and institutions." 
It is headed by Walter S. Steele, who was tied up with Harry 
A. Jung of the American Vigilant Intelligence Federation before 
he went into business for himself. While Steele was working with 



NAZI AGENTS IN AMERICAN UNIVERSITIES 127 

the ace of racketeers in patriotism, the president-editor of the 
National Republic also eked out a few pennies by distributing the 
"Protocols of the Elders of Zion." Today, however, he confines 
himself chiefly to fighting Communism, spreading race hatred only 
when it is paid for in advertisements. Books distributed by Nazi 
propagandists in furthering their anti-democratic campaign such 
books as T.N.T. by Colonel Edwin Hadley and The Conflict of 
the Ages find space in the National Republic s pages. Colonel 
Hadley headed the Paul Reveres which tried to organize fascist 
groups on American university campuses, and The Conflict of 
the Ages devotes a full chapter to the Nazi "proofs" of the 
authenticity of the "Protocols." 

I mention these to show the type of stuff Steele is willing to 
disseminate if he is paid for it. And by permitting the use of 
their names, the sponsors, consciously or unconsciously, aid him 
in his anti-American activities. 

The detailed aims of the National Republic are to provide a 
"weekly service to twenty-three hundred editors, to defend 
American institutions against subversive radicalism; a national 
information service on subversive organizations and activities; 
an Americanization bureau serving schools, colleges and patri 
otic groups; conducted for the public good from Washington, 
D. C., by nationally known leaders." 

The procedure of conducting the organization "for the public 
good" includes high-pressuring the shekels from the suckers. 
Steele, a former newspaperman, learned from his association with 
that other arch-patriot, Jung. So when Steele established his 
own racket, he found one of his early aids in former Senator 
Robinson of Indiana. Robinson was closely tied up with the 
Ku Klux Klan. Through Robinson and through other poli 
ticians reached with the cry "Save America," he got a long list 
of prominent sponsors and gradually increased it until now it 
reads like a Who s Who of reactionary industrialists and innocent 
politicians. With letters of introduction from Senator Robinson, 



128 SECRET ARMIES 

Steele s high pressure gang set out to collect in the name of 
patriotism. 

The procedure was simple. Salesmen presented their letters of 
introduction to the mayor of a city. The mayor was impressed 
with the high "patriotic" motives and especially with the impos 
ing list of names sponsoring the efforts. The mayor introduced 
the high-pressure fellows to other people and the milking began. 

Let me illustrate a little more specifically: 

On March 4, 1936, Steele sent two of his ablest dollar-pullers, 
Messrs. Fahr and Hamilton, into the Oklahoma oil fields where 
the industrialists would like to see a minimum of 200 per cent 
Americanism instilled in the public mind. Messrs. Fahr and 
Hamilton had letters of introduction to Mayor T. A. Penny of 
Tulsa, Okla. When the salesmen approached the Mayor, they 
had not only the long and imposing list of names on the letter 
head but additional letters of introduction from ex-Governor 
Curley of Mass., ex-Senator Robinson of Indiana and Congress 
man Martin Dies of Texas. The drummers wanted the Mayor 
to introduce them to the Chairman of the Tulsa Board of Edu 
cation who could help them get funds in Tulsa and elsewhere. 
The funds were to be used to place the "patriotic" magazine 
in the public school system in order "to preserve this country 
against subversive activities, particularly Communism." 

It was a neat circulation-getting stunt, performed without 
Fahr and Hamilton telling what percentage of the take they got. 

The Mayor gave the letters of introduction. With these letters 
and the excellent contacts thus established, they started down 
the sucker list from W. G. Skelly, head of the Skelly Oil Co., 
Tulsa to Waite Phillips of the Phillips Petroleum Co. 

Like his former colleague Harry A. Jung, Steele works on 
the big industrialists by whispering confidentially that he has 
sources of information about which he can t talk much but 
which make it possible for him to keep the industrialists in 
formed about "subversive radicals." For a reasonable price and 



NAZI AGENTS IN AMERICAN UNIVERSITIES 129 

perhaps a contribution to a worthy cause, Steele would supply 
the industrialist with "confidential information for members 
only" which would keep him up to date about the radicals 
threatening America. The "confidential information" must not 
be shown to anybody else. Extreme caution is necessary lest the 
radicals find out about the "information service." With all this 
hocum, secrecy and w r hispering, the industrialist becomes a 
member at so much per not realizing that the information thus 
peddled can be got for three cents a day five cents on Sundays 
by buying the Daily Worker. It s just one of the little patriotic 
rackets the boys have cooked up. 

Working closely with Steele is James A. True of the James 
True Associates, another precious racketeer who stepped from 
patrioteering into efforts to organize in conjunction with Nazi 
agents a secret armed force in the United States. With True in 
this effort to establish a Cagoulard organization in this country, 
were some of the most active Nazi agents and patrioteers. 



X 

Underground Armies in America 

EARLY IN 1938 NATIVE AMERICANS, working with Nazi agents, 
completed plans to organize a secret army along the general 
lines of the Cagoulards in France. The decision was made after 
the liaison man between Nazi agents here and plotters for the 
secret army met with Fritz Kuhn and Signor Giuseppe Cosmelli, 
Counselor to the Italian Embassy in Washington. 

The liaison man is Henry D. Allen, who moved from San 
Diego to 2860 Nina St., Pasadena, Calif. Allen, the reader may 
recollect, helped Schwinn organize the Mexican Gold Shirts 
which unsuccessfully attempted to seize the Mexican Govern 
ment. Allen is still active in a plot to overthrow the Cardenas 
Government, working at the moment with Gen. Ramon F. Iturbe, 
a member of the Mexican Chamber of Deputies, with Gen. 
Yocupicio who is smuggling arms as part of a plan to rebel, 
and with Pablo L. Delgado who took over the fascist Gold Shirt 
work under a different name after Rodriguez was exiled when 
his attempt to march on the Government failed. 

To understand the feverish activities of foreign agents and 
native Americans working with foreign agents, one must remem 
ber that when the World War broke out in 1914, Germany was 
caught with only small espionage and sabotage organizations in 
the United States. It cost the German War Office large sums of 
money to build them under difficult and dangerous conditions. 
The Nazis do not intend to be caught the same way in the 

130 



UNDERGROUND ARMIES IN AMERICA 131 

event a war finds the United States on the enemy side or, if 
neutral, supplying arms and materials to the enemy. 

The first step to prevent such a development is to build an 
enormous propaganda machine and to draw into it as many 
native Americans as possible. Because of the future potentiali 
ties of natives as spies and saboteurs, the Nazi leaders take ex 
traordinary precautions to safeguard their identities. Should the 
United States become involved in a war with fascist powers, 
especially Germany, the German members of the Bund can be 
watched and, if necessary, interned; but native Americans not 
known as Bund members can move about freely, hence the 
care to prevent their identities from becoming known. Schwinn, 
for instance, keeps a regular list of the German-American Bund 
members at the Deutsches Haus in Los Angeles. The native 
American members, however, are not listed. The names are kept 
in code and only Schwinn knows the code numbers. 

Military considerations thus lead the Nazi General Staff to 
maintain this propaganda in the United States, despite the 
knowledge Nazi leaders in Germany have that its activities and 
distasteful propaganda here are seriously hampering German- 
American commercial relations. 

The propaganda machine is already functioning as the Ger 
man-American Volksbund. The second step, as was demonstrated 
in France with the Cagoulards and in Spain with Franco s Fifth 
Column, is to organize secret armies capable of starting sporadic 
outbreaks tantamount to civil wara procedure which would 
naturally deflect the country s energies in war time. 

This second step was taken after careful study, and Henry D. 
Allen was chosen as the liaison man between those maneuvering 
the plot. 

The private letters exchanged between Allen and his fellow 
conspirators are now in my possession. Some of the letter* 
exchanged were signed with the writers real names and some 
with code names. Allen s code name, for instance, is "RosenthaL" 



132 SECRET ARMIES 

On April 13, 1938, he wrote to a "G. D." (of whom more 
shortly) as follows: 

Have just sent Delgado into Sonora incognito. This move has resulted from 
a four-party conference held in Yuma a few days ago. This party was com 
posed of Urbalejo, chief of the Yaqui nation, Joe Mattus, his trusted lieuten 
ant, Delgado and myself. Yocupicio has completely come over to our side, 
which you can perceive from the outcome of the little tryout in Aqua Prieta 
a few weeks ago. Delgado has arrived safely at Bocatete, and will get the 
boys in that part of the country pretty active. . . . Inasmuch as I am his legal 
and properly accredited representative in the United States, you may rest 
assured that there will be no doubt as to the objectives of this movement 
south of the Rio Grande. 

I have received three letters from General Iturbe in which he tells me that 
they are taking the Spanish copies of the Protocols which K. sent me, and 
making 5,000 copies of same. In each letter he begs me to set a time and 
date for meeting him at Guadalajara for the purpose of effecting the neces 
sary plans for active campaigning with Delgado. I will arrange all of this as 
soon as you consider it expedient. . . . 

ROSENTHAL. 

Two days later (April 15, 1938) he wrote from Fresno, Calif. 
under his own name to F. W. Clark, 919^ S. Yakima Ave., 
Tacoma, Wash. The letter reads in part: 

Relative to the Gold Shirts of Mexico, please be advised that we found it 
necessary to reorganize this group in August, 1937. The activist elements have 
proceeded and are now carrying on under the name of the Mexican Na 
tionalist Movement of which Pablo L. Delgado is the nominal head. I am 
the legal and personal representative of Delgado in the movement in the 
United States. 

So much for his current activities to establish fascism to the 
south of us. 

Most Americans who fall for Nazi propaganda do not suspect 
that they are being played for suckers by shrewd manipulators 
pulling the strings in Berlin, and probably not one of the many 
reputable and sincerely patriotic Americans who fell for Allen s 



UNDERGROUND ARMIES IN AMERICA 133 

"patriotic" appeals suspects his activities against the country he 
so zealously wants to "save." 

Some shrewd observer once remarked that "patriotism is the 
last refuge of a scoundrel." Whenever I come across an "ultra- 
patriot" with foam dripping from his mouth while he beats his 
chest with loud cries about his own honesty and the crooked 
ness of those running the country, I suspect a phony. As a rule, 
I look for the criminal record of a man who s yelling "Chase 
out the crooks" and "Let s have honest government," and all 
too often I find one. Henry D. Allen, alias H. O. Moffet, alias 
Howard Leighton Allen, alias Rosenthal, etc., ex-inmate of San 
Quentin and Folsom prisons, is no exception; his criminal 
record extends over a period of twenty-nine years. 

Let me give the record before I start quoting from his letters, 
chiefly for the benefit of those sincere and loyal Americans who 
thought his Swastika-inspired activities represented honest con 
victions. 

May 17, 1910: Arrested in Los Angeles charged with uttering 
fictitious checks. In simple language this means just a little bit 
of forgery. Los Angeles Police Department file, No. 7613. 

June 10, 1910: Sentenced to three years imprisonment; sen 
tence suspended upon tearful assurances of good behavior. 

May 12, 1912: Picked up in Philadelphia charged with being 
a fugitive; brought back to Los Angeles. 

July i, 1912: Committed to San Quentin. Guest No. 25835. 

April 21, 1915: Committed to Folsom from Santa Barbara on 
a forgery charge. Guest No. 9542. 

Feb. i, 1919: Arrested in Los Angeles County charged with 
suspicion of a felony. Los Angeles County No. 14554. 

June 31, 1924: Arrested in San Francisco, charged with utter 
ing fictitious checks. No. 35570. 

Oct. 5, 1925: Los Angeles Police Department issued notice 
that Allen was wanted for uttering fictitious checks. Bulletin 
No. 233. 



134 SECRET ARMIES 

Allen is apparently a prolific writer of bad checks and of long 
reports about his activities to his superiors. 

Two of Allen s close friends are also native Americans: C. F. 
Ingalls of 2702 Bush St., San Francisco and George Deatherage 
(the G. D. mentioned earlier) . Deatherage now lives and 
operates out of St. Albans, W. Va. He organized the American 
Nationalist Confederation which used to have its headquarters 
in Palo Alto, Calif. Both these gentlemen also work with 
Schwinn. 

On January 7, 1938, Deatherage received from San Francisco 
a letter signed "C.F.I." in a plain envelope without a return 
address. The letter is very long and detailed. I quote in part: 

We must get busy organizing grid-lattice-work or skeleton for a military 
staff throughout the nation, and in this we need representatives of fascist 
groups, and we need Americans with whom these others may be incorporated. 
... All must believe in being ruthless in an emergency. . . . 

The political and the military organizations must not be unified. They 
have different aims. With one hand we offer the public a potential program. 
Whether they accept it or not and whether they wish to return to the ideals 
embodied in a representative form of a constitutional federal republic or not, 
is of secondary importance. Of first importance is the need of the emergency 
military organization to function simultaneously should our enemies revolt if 
we should win politically or should we revolt if our enemies win politically. 

On January 19, 1938, Deatherage received a letter signed with 
the code name "Laura and Clayton." "Laura" is Hermann 
Schwinn. This letter, too, is long and goes into details on how 
best to organize the secret military group and have it ready for 
instant action. The letter states at one point: 

After we do all this, now then we shall have the national military frame 
work all steamed up and oiled and coupled to the multiplicity of working 
parts ready to appear on all fronts. . . . 

After "C.F.I." and "Laura and Clayton" had decided on the 
details of the secret military body in which they needed the aid 
of "Nazi and fascist" forces, they needed money and arms. 



UNDERGROUND ARMIES IN AMERICA 1 35 

Early in January, Allen received from "Mrs. Fry and C. Chap 
man" four hundred and fifty dollars for a trip to Washington, 
D. C. "Mrs. Fry and C. Chapman" live in Santa Monica, but 
use Glendale, Calif, for a post office address. This money was 
spent between January 13 and February 10, 1938, according to 
the expense account Allen turned in to the Fry-Chapman 
combination. 

Three days after Allen got the money (January 16, 1938), he 
received from Schwinn a letter of introduction to Fritz Kuhn, 
addressed to the Amerikadeutscher Volksbund, 178 E. 85th 
Street, New York City. The letter was written in German. Fol 
lowing is the translation: 

My Bund Leader: 

The bearer of this letter is my old friend and comrade-in-arms, Henry 
Allen, who is coming East on an important matter. 

Mr. Allen knows the situation in Los Angeles and California very well and 
can give you important information. We can give Allen absolute confidence. 

Hail and Victory, 
HERMANN SCHWINN. 

The "important matter" on which Allen was going East and 
which he wanted to discuss with the national Nazi leader in 
this country, was to contact the Italian Embassy, the Hungarian 
Legation, James True of the James True Associates (distributors 
of "Industrial Control Reports" from its headquarters in Wash 
ington, D. C.) , George Deatherage in St. Albans, W. Va., and 
several others. 

Allen reported regularly to Chapman, signing his letters with 
the code name "Rosenthal." I quote in part from one letter 
written from Washington on January 24, 1938: 

Upon calling at the Rumanian Embassy I found the Ambassador with all 
his attaches are of the Carol-Tartarescu regime, and they are sailing on 
Wednesday, January 26. The new Ambassador will arrive with his staff on 



136 SECRET ARMIES 

Saturday, I am told. The letter which you gave me I mailed to Budapest 
myself, not daring to entrust it to the present staff at the Embassy. At the 
Italian Embassy I found the Ambassador away, but I had a very delightful 
and satisfactory conference with Signor G. Cosmelli, who is the Italian 
counselor. . . . 

Shortly after the conference at the Italian Embassy, True and 
Allen conferred. Subsequently, True wrote to Allen and added 
a postscript in long hand: "But be very careful about controlling 
the information and destroy this letter." 

Allen did not destroy it immediately. The letter, dated Feb 
ruary 23, 1938, reads in part: 

The bunch of money promised off and on for three years may come 
through within the next week or two. We have had so many disappointments 
that I hardly dare hope but there seems a fair chance of results. If it comes 
through we will have you back here in a hurry. You, George, and I will get 
together and prepare for real action. 

If your friends want some pea shooters, I have connections now for any 
quantity and at the right price. They are United States standard surplus. 
Let me know as soon as you can. 

To these events must be added the peculiar and unexplained 
actions of the Dies Congressional Committee appointed to 
"investigate subversive activities." The Committee employed a 
Nazi propagandist as one of its chief investigators and refused 
to question three suspected Nazi spies working in the Brooklyn 
Navy Yard. Congressman Martin Dies of Texas, chairman of 
the Committee, gave two of the National Republic s high-pres 
sure men letters of introduction when they started out on a 
little milking party in the name of patriotism. He received the 
cooperation of Harry A. Jung, and he refused to examine the 
files of James A. True when the above letter was brought to 
his Committee s attention. 

But these actions merit more detailed consideration. 



XI 
The Dies Committee Suppresses Evidence 

THREE SUSPECTED NAZI SPIES were quietly taken out of the 
Brooklyn Navy Yard to the Dies Congressional Committee 
headquarters in New York in Room 1604, United States Court 
House Building. The three men were each questioned for about 
five minutes by Congressman J. Parnell Thomas* of New Jersey 
and Joe Starnes of Alabama. The men were asked if they had 
heard of any un-American goings-on in the Navy Yard. Each 
of the three subpoenaed men said he had not, and the Con 
gressmen sent them back to work in the Navy Yard after warn 
ing them not to say a word to anyone about having been called 
before the Committee. 

When I learned of the Congressional Committee s refusal to 
question men they had subpoenaed, I wondered at the unusual 
procedure especially since it promptly put Nazi propagandists 
(such as Edwin P. Banta, a speaker for the German-American 
Bund) on the stand as authorities on "un-American" activities 
in the United States. A little inquiry turned up some interesting 
facts. 

One of the Committee s chief investigators, Edward Francis 
Sullivan of Boston, had worked closely with Nazi agents as far 
back as 1934. Sullivan s whole record was extremely unsavory. 
He had been a labor spy, had been active in promoting anti- 

* Formerly known as J. Parnell Feeney. He changed his name because he 
thought he could get along better in the business world with a name lik* 
Thomas than with a name as potently Irish as Feeney. 

137 



138 SECRET ARMIES 



She CommctweaStb of Amacbntett* 



MIDDLESEX ae, AT THB PfiOT M8TWCT COUstiTOF BAftftH* MEDDUBBX 
holden at Maiden, in the County of IITMisW. for tfttt 

transaction of criminal 1.nina. OB tha fourth 

day of tbraary iatheywr^ofc 

one thousand nine hundred and MM*? thirty-tin 




ird Francis Sullii 
is bought before said Court, in 
OP MASSACHUSETTS, on a complaint, duly made under oath, a true copy of which is 
herewith transmitted. 

Which complaint is read to the said defendant, and he is 

asked by the Court whether he is guilty or not guilty of the offence charged against him 

in said complaint, and said defendant pleads and says that he is not 



and after hearing the witnesses in the case duly sworn, and fnSy hearing 
and ufriey fcs^lie defence of said defendant, it appears to said Court that said 
defendWjs gufltyj the offence aforesaid. 

^*"*^^ IT IS THEREFORE CONSIDERED AND ORDERED BY THB COURT. 
that tht said defendant, for the offence aforesaid. 



be committed to the House of Correction, in 




accordmss^tarules and regulations thereof, for 
-sateys; monfrs^from said hut mentioned day. 
notified by said Court of 
right to appeal from said conviction and sentence. 

ATraST: - 




CUrk. 

From which sentence the said defendant appeals to the SUPERIOR COURT, next to be 
holden at Cambridge, within and for the County of Middlesex, for the transaction of criminal 
business, on the first Monday of March next, and he is ordered 

to be-JMM.oa.4iis **m teoegaimisai recngmae to the Commonwealth, in the 
sum of Two thousand -JCTftM dollars, with sufficient 

surety, to prosecute said appeal there as the law directs nd stand committed to abode 
the sentence of said Court thereon, until he so recognizes. 

>1th whlc 1 - said order the said defendant refua to comply and is 
coarlttt*. 

ATTEST: 




A tru* copy, Atfst: 

Wilfred B. Tyler. Clrk. 



Reproduction of a document showing that Edward Francis Sullivan, at one time chief 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 



139 



f- - 

I 



I I 






1 



07 MASSACHtJSBfrS 



Middlesex, e, 



Superior Court 




In Teotlaony that the. foregoing la a tru* topy of Copy of 
Judgment, I hereunto set my hand and 
affix the seal of said Superior Court, 
this nineteenth day of August. A.D. 199ft 



^ 

Clerlr. 



imvestigator for the Dies Committee, was convicted of larceny and sentenced to prison. 



140 SECRET ARMIES 

democratic sentiments in cooperation with secret agents of the 
German Government and in addition was a convicted thief. 
(Shortly after Slap-Happy Eddie, as he was known around 
Boston because of his convictions on drunkenness, lined up with 
the Nazis, he got six months for a little stealing.) Before going 
on with the Congressional Committee s strange attitude toward 
suspected spies and known propagandists in constant communi 
cation with Germany, it might be well to review a meeting which 
the Congressional Committee s investigator addressed in the 
Nazi stronghold in Yorkville. 

On the night of Tuesday, June 5, 1934, at eight o clock, some 
2,500 Nazis and their friends attended a mass meeting of the 
Friends of the New Germany at Turnhall, Lexington Ave. and 
85th Street, New York City. Sixty Nazi Storm Troopers attired 
in uniforms with black breeches and Sam Brown belts, smuggled 
off Nazi ships were the guard of honor. Storm Troop officers 
had white and red arm bands with the swastika superimposed 
on them. Every twenty minutes the Troopers, clicking their 
heels in the best Nazi fashion, changed guard in front of the 
speakers stand. The Hitler Youth organization was present. 
Men and women Nazis sold the official Nazi publication, Jung 
Sturm, and everybody awaited the coming of one of the chief 
speakers of the evening who was to bring them a message from 
the Boston Nazis. 

W. L. McLaughlin, then editor of the Deutsche Zeitung, spoke 
in English. He was followed by H. Hempel, an officer of the 
Nazi steamship "Stuttgart," who vigorously exhorted his audi 
ence to fight for Hitlerism and was rewarded by shouts of "Heil 
Hitler!" McLaughlin then introduced Edward Francis Sullivan 
of Boston as a "fighting Irishman." The gentleman whom the 
Congressional Committee chose as one of its investigators into 
subversive activities, gave the crowd the Hitler salute and 
launched into an attack upon the "dirty, lousy, stinking Jews." 
In the course of his talk he announced proudly that he had 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 141 

organized the group of Nazis in Boston who had attacked and 
beaten liberals and Communists at a meeting protesting the 
docking of the Nazi cruiser "Karlsruhe," in an American port. 
The audience cheered. Sullivan, again giving the Nazi salute, 
shouted: "Throw the goddam lousy Jews all of them into the 
Atlantic Ocean. We ll get rid of the stinking kikes! Heil Hitler!" 

The three suspected Nazi spies were subpoenaed on August 
2$, 1 9$&- They were: 

Walter Dieckhoff, Badge No. 38117, living at 2654 E. igth 
Street, Sheepshead Bay. 

Hugo Woulters, Badge No. 38166, living at 221 East i6th 
Street, Brooklyn. 

Alfred Boldt, Badge No. 38069, living at 64-29 yoth Street, 
Middle Village, L. I. 

Boldt had worked in the Navy Yard since 1931. Dieckhoff 
and Woulters went to work there within one day of each other 
in June, 1936. 

The three men were kept in the Committee s room from one 
o clock on the day they were subpoenaed until five in the after 
noon. When it became apparent that the Congressmen would 
not show up until the next day, the men were dismissed and told 
to come back the following morning. 

Not a word was said to them as to why they had been sub 
poenaed. Nevertheless Dieckhoff, who was with the German 
Air Corps during the World War, instead of going to his home 
in Sheepshead Bay, drove to the home of Albert Nordenholz 
at 1572 Castleton Ave., Port Richmond, S. I., where he kept twd 
trunks. Nordenholz, a German-American naturalized citizen 
for many years, is highly respected by the people in his neigh 
borhood. When Dieckhoff first came to the United States, the 
Nordenholzes accepted him with open arms. He was the son 
of an old friend back in Bremerhafen, Germany. Dieckhoff 
asked permission to keep two trunks in the Nordenholz garret; 



142 SECRET ARMIES 

he stored them there when he went to work in the Brooklyn 
Navy Yard. 

During the two years he worked in the Yard, he would drop 
around every two weeks or so and go up to the garret to his 
trunks. Just what he did on those visits, Nordenholz does not 
know. 

On the night Dieckhoff was subpoenaed he suddenly appeared 
to claim the trunks. He told Nordenholz that he planned to 
return to Germany. Just what the trunks contained and what he 
did with them I (Jo not know. They have vanished. 

I called upon Dieckhoff in the two-story house in Sheepshead 
Bay where he lived. He had no intimate friends, didn t smoke, 
drink or run around. The life of the German war veteran 
seemed to be confined to working in the Navy Yard, returning 
home unobtrusively to work on ships models and making his 
occasional visits to Nordenholz s garret. 

So far as I could learn, Dieckhoff became a marine engineer, 
working for the North German Lloyd after the World War. 
In 1923 he entered the United States illegally and remained 
for two years. Eventually he returned to Germany, but came 
back to the United States, this time legally, applied for citizen 
ship papers and became a naturalized citizen five years later. 

Before he went to work on American war vessels, he worked 
in various parts of the country in automobile shops, in the 
General Electric Co. in Schenectady and as an engineer on 
Sheepshead Bay boats. Even after Hitler came into power, he 
worked on Sheepshead Bay boats. After the Berlin-Tokyo axis 
was formed (1935) , Germany became particularly interested in 
American naval affairs, for the axis, among other things, ex 
changed military secrets. Shortly before the agreement was made, 
Dieckhoff suddenly went to work for the Staten Island Ship 
building Co., Staten Island, which was building four United 
States destroyers, numbers 364, 365, 384 and 385. He worked on 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 143 

these destroyers during the day. Until late at night he pursued 
his hobby of building ships models, which he never made an 
attempt to sell. 

Dieckhoff weighed his words carefully during our talk. 

"Why did you apply for a transfer from Staten Island to the 
Brooklyn Navy Yard?" I asked. 

"I don t know," he said. "I guess there was more money in it." 

"How much were you getting when you were working on the 
destroyers?" 

"It was some time ago," he said slowly. "I do not remember 
very good." 

"How much are you getting now at the Navy Yard?" 

"Forty dollars and twenty-nine cents a week." 

"You went to Germany last year for a couple of months and 
before that you went to Germany for six months. Were you able 
to save enough for these trips on your wages?" 

"I do not spend very much," he said. "I live here all alone." 

"How much do you save a week?" 

"Oh, I don t know. Ten dollars a week." 

"That would make five hundred dollars a year if you worked 
steadily, which you didn t. You traveled third class. A round 
trip would be about two hundred dollars. That would leave 
you three hundred to spend provided you did not buy clothes, 
etc., for these trips. How did you manage to live in Germany 
for six months on three hundred dollars? Did you work there?" 

He hesitated and said, "No, I did not work there. I traveled 
around. I was not in one place." 

"How did you do it on three hundred dollars for six months? 

"My brother gave me money." 

"What s your brother s business?" 

"Oh, just general business in Bremerhafen. He s got a big 
business there." 

"Perhaps I can get a report from the American Consul" 

"Oh," he interrupted. "His business isn t that big." 



144 SECRET ARMIES 

"Have you a bank account?" 

He hesitated again and then said, "No, I do not make enough 
money for a bank account." 

"Where do you keep your money for trips to Germany? 
In cash?" 

"Yes, in cash." 

"Where? Here? In this room?" 

"No. Not in this room. I have it locked up." 

"Where?" 

"Oh, different places," he said vaguely. 

"Where are those places?" 

"I have my money with a friend." 

"Who?" 

"Nordenholz, Albert Nordenholz." 

"You work in Brooklyn, live in Sheepshead Bay and save ten 
dollars a week in Port Richmond with a friend? Isn t that a long 
distance to go to save money?" 

He shrugged his shoulders without answering. 

"What s Nordenholz s business?" 

"I think he s retired. I think he used to be a butcher." 

"You don t know very much about a man s business and you 
travel all this distance to give him money to save for you when 
there are banks all around? Why do you do that?" 

"Oh, I don t know. It seems to me that it is better that way." 

Later when I asked Nordenholz, he denied that Dieckhoff had 
ever given him any money to hold. 

Dieckhoff had worked on turbines, gear reductions and other 
complicated mechanical parts on the cruiser "Brooklyn." The 
moment I asked him if he handled blueprints he answered in 
the affirmative, but quickly added that the blueprints were 
returned every night and locked up by the officers. A capable 
machinist could, he admitted, after careful study remember the 
blueprints well enough to make a duplicate copy. 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 145 

"When you went to Germany after working on the destroyers 
did anyone ever question you about them over there?" 

"No," he said quickly. "Nobody." 

"My information is that you did talk about structural matters." 

He looked startled. "Well," he said, "my brother knew I 
worked in the Brooklyn Navy Yard. We talked about it, natur 
ally." 

"My information is that you talked about it with other people, 
too." 

He stared out of the window with a worried air. Finally he 
said, "Well, my brother has a friend and I talked with him 
about it." 

"A minute ago you said you had not talked about it with 
anyone." 

"I had forgotten." 

"This is the brother who gave you money to travel around 
in Germany?" 

He didn t answer. 

"I didn t hear you," I said. 

"Yes," Dieckhoff said finally, "he gave me the money." 

I called upon the second of the three suspected spies sub 
poenaed by the Dies Committee. Alfred Boldt had done very 
responsible work on the U. S. cruiser "Honolulu." Though he 
had not been in Germany for ten years, he suddenly got enough 
money last year to go there and to send his son to school at a 
Nazi academy. Boldt, too, has no bank account. He needed a 
minimum of seven hundred dollars for his wife and himself to 
cross third class, but the Dies Committee was not interested 
in where the money for the trip had come from. 

Boldt left for Germany on August 4, 1936, and returned Sep 
tember 12. On the evening I dropped in to see him, he was 
tensely nervous. He had heard that someone had been around 
to talk with Dieckhoff. 



146 SECRET ARMIES 

"I understand your only son, Helmuth, is going to school in 
Langin, Germany?" I asked. 

"Yes," he said, "I sent him there two years ago." 

"No schools in the United States for a fifteen-year-old boy?" 

"I wanted him to learn German." 

"What do you pay for his schooling over there?" 

He hesitated. His wife, who was sitting with us and occasion 
ally advising him in German, suddenly interrupted in German, 
"Don t tell him. That s German business." 

I assume they did not know that I understood, for Boldt 
passed off her comment as if he had not heard it and said 
casually, "Oh, twenty-five dollars a month." 

"You earn forty dollars a week at the Navy Yard, pay for your 
son s schooling in Germany, clothes, etc., and you and your wife 
took more than a month s trip to Germany last year. How do 
you do it on forty a week?" 

His wife giggled a little in the adjoining room. Boldt shrugged 
his shoulder without answering. 

"The cheapest the two of you could do it, third class, would 
be about seven hundred dollars. Where do you have your bank 
account?" 

"No. No bank account," his wife interrupted sharply. 

"All the money is kept here, right here in this house," he 
laughed. 

"You saved all that money in cash?" 

"Yes; in cash, right here." 

"No banks?" 

"We like it better like that in cash." 

Boldt, like Dieckhoff, had been a marine engineer on the 
North German Lloyd. He went to work in the Brooklyn Navy 
Yard in 1931. When the cruiser "Honolulu" made its trial run 
in the spring of 1938, Boldt was on board. 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 147 

Like Dieckhoff and Boldt, Harry Woulters, alias Hugo Woul- 
ters, the third of the three subpoenaed men, is a naturalized 
citizen of German extraction. He went to work in the Navy 
Yard within one day of Dieckhoff. Before that, both had worked 
on the same four American destroyers at the Staten Island 
Shipbuilding Company. 

The house where Woulters lives has a great many Jews in it, 
judging from the names on the letterboxes, and since Hugo 
sounded too German, he listed his first name as "Harry." 

"You and Dieckhoff worked on the same destroyers on Staten 
Island and you say you never met him there?" I asked. 

"No, I never met him until the second day after I went to 
work in the Navy Yard." 

"How many people work on a destroyer a thousand?" 

"Oh, no. Not that many." 

"About one hundred?" 

"About that," he said uncertainly. 

"And you worked with Dieckhoff for six months on the same 
warships and never met him?" 

"Yes," he insisted. 

"How come that if you never met him both of you applied 
for jobs at the Brooklyn Navy Yard at about the same time?" 

He shrugged his shoulders. "I don t know. It s funny. Sounds 
funny, anyway." 

"When you worked on the cruiser Honolulu you handled 
blueprints?" 

"Yes, of course, but they were never left in my possession 
overnight," he added quickly. I couldn t help but think that 
Dieckhoff, too, had been very quick in protesting that the blue 
prints had never been left in his possession overnight. They seemed 
worried about that even though I had not said anything about it. 

"Were they ever left in your possession overnight?" 



148 SECRET ARMIES 

"No. They guarded the blueprints" 

"My information is that they were left in your possession." 

"Wells, sometimes blueprints you know, when you work from 
blueprints sometimes, yes, sometimes blueprints were left in my 
possession overnight. I was working on reduction gears on the 
cruiser Brooklyn and I kept the blueprints overnight." 

"How often?" 

"I can t remember how often. Sometimes the blueprints were 
kept overnight in my tool box." 

"You also worked on turbines and other complicated and con 
fidential structural problems on the warship?" 

"Yes." 

"And you kept those blueprints overnight, too?" 

"Sometimes not often. Sometimes I left them in my tool box 
overnight." 

Woulters, during the latter period of construction on the 
"Brooklyn" and the "Honolulu" had got two jobs which most 
workers do not like. He had the four to midnight and the mid 
night to eight A.M. watches. Normally Woulters likes to stay 
at home with his wife. 

"While you had these watch duties you had pretty much the 
run of the ship?" 

He hesitated and weighed his words carefully before answering. 
Finally he nodded and added hastily, "But no one can get on 
board." 

"I didn t ask that. Did you have the run of the ship while 
everybody else was asleep when you were on watch?" 

"Yes," he said in a low voice. 

"How did you happen to work in the Brooklyn Navy Yard?" 

"Oh, I don t know. I like to work for the Government." 

"Have you a bank account?" 

"Yes." 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 149 

"What bank?" 

"Oh, I don t know, it s some place on Church Avenue." 

"You have about 2,400 dollars in the bank, a nice apartment, 
and you and your wife went on a trip to Germany last year. 
Did you save all that money in so short a time on wages of 
forty dollars a week?" 

He shrugged his shoulders. 

"Your bank account does not show withdrawals sufficient to 
cover the trip to Germany" 

"Say," he interrupted excitedly as soon as he saw where the 
question was leading, "when I was called before the Dies Com 
mittee, the Congressman there shook hands with me and asked 
me if I knew anything about un-American activities in the Navy 
Yard. I told him I didn t and he told me to go back to wor 
and not to say anything about having Been called before them. 
Now I do not understand why you ask me all these questions. 
The Congressman told me not to talk and I am saying nothing 
more. Nothing." 

The Dies Congressional Committee was not interested in 
these three men whom they had subpoenaed and then, oddly 
enough, refused to question. Besides this very strange proce 
dure by a Committee empowered by the Congress to investigate 
subversive activities, the Dies Committee withheld for months 
documentary evidence of Nazi activities in this country directed 
from Germany. The Committee obtained letters to Guenther 
Orgell and Peter Gissibl, but quietly placed them in their files 
without telling anyone about the existence of these documents. 
They did not subpoena or question the men involved. 

The letters the Committee treated so cavalierly are from E. A. 
Vennekohl in charge of the foreign division of the Volksbund fur 
das Deutschtum im Ausland with headquarters in Berlin, letters 



150 SECRET ARMIES 

from the foreign division headquarters in Stuttgart, and from 
Orgell to Gissibl. 

Gissibl was in constant touch with Nazi propaganda head 
quarters in Germany, receiving instructions and reporting not 
only on general activities, but especially upon the opening by 
the Nazis here of schools for children in which Nazi propaganda 
would be disseminated. 

The letters, freely translated, follow. The first is dated October 
2 9> 1 937* anc * was sent by Orgell from his home at Great Kills, 
S. I.: 



Dear Mr. Gissibl: 

Many thanks for your prompt reply. My complaint that one cannot get an 
answer from Chicago refers to the time prior to May, 1937. 

I assume from your writing that it is not opportune any more to deliver 
further books to the Arbeitsgemeinschaft, etc. 

The material which Mr. Balderman received came from the V.D.A.* It 
has been sent to our Central Book distributing place (Mirbt) . If he wishes 
he can get more any time; that is, if you recommend it. 

The thirty books for your Theodore Koerner School, which arrived this 
summer (via the German Consulate General in Chicago) , also came from 
the V.D.A. If you need more first readers or study books, please write 
directly to me. Your request then goes immediately without the official way 
via the Consulate and Foreign Office to our Central Book distributing place. 
Please say how many you need and what else beside the first readers and 
primersf you need. I will take care that it will be promptly attended to. 
Fritz Kuhn, of course, has to be informed of your request and has to give 
his okay. . . . 

With German greetings, 

CARL G. ORGELL. 



* Nazi propaganda center for foreign countries with headquarters in 
Germany. 

j-The notorious Nazi Primer teaching children songs of hate against Jews 
and Catholics. 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 151 

Five days earlier Orgell had written to Gissibl: "You may 
perhaps remember that I am in charge of the work for the 
Volkbund fur das Deutschtum im Ausland\ for the U.S.A." 



Great Kills, S.X./HY 24.10:37 



Harm Ptor Gissibl 
3855/57 North ?/e stern A. 
CMxago, 111* 



Lleber Herr 

Sie verden tich vielleieht erianern, dasa ioh 
file VDfc ( Volktbund fuer das Deutsehtua I* Ausland, Berlin) 
Arbeiten fuer USA erledige. 

Unsere Buecherstelle in Berlin aoechtejrmn gerne 

tyaide Ave. Chicago vun Buacher 
satlon "(?) ^ebeten* Kennen Bie ihn 4 
leitet er f 

Deutachen OPUS 




A letter the Dies Committee shelvedCarl G. Orgell identifying himself to 
Peter Gissibl as a representative of the People s Bund for Germans Living 
Abroad. 

On March 18, 1938, Gissibl, who had been taking instructions 
from Orgell, received the following letter from Stuttgart: 

Dear Peter: 

From your office manager, Comrade Moller, I received a letter dated 
February 15. He informed me among other things that an exchange of 
youth is out of the question for this year. I regret this very much. I would 
like to see, in the interests of our common efforts, if we would have had 
youth all ready this year, especially also from your district. Perhaps it is 

$ People s Bund for Germans Living Abroad. 



152 SECRET ARMIES 

still possible with your support. The time, of course, which is still at our 
disposal, is very limited. This I can see clearly. 

I will write to you again in greater detail soon. In the meantime you can 
perhaps send me more detailed information about the development of your 
school during the past weeks; I recommend again the fulfillment of your 
justified wishes wholeheartedly. Let us hope that the result might be 
achieved very soon towards which we in common strive. 
Hearty greetings from house to house. 

In loyal comradeship, 
Yours, 
G. MOSHACK. 

On May 20, 1938, E. A. Vennekohl, of the People s Bund for 
Germans Living Abroad, wrote to Gissibl as follows: 



Dear Comrade Gissibl: 

We wrote you yesterday that the 3,000 badges for the singing festival would 
be sent to you via Orgell; for various reasons we have now divided the 
badges in ten single packages of which two each went to the following 
addresses: Friedrich Schlenz, Karl Moeller, Karl Kraenzle, Orgell and two 
to you. 

Please inform your co-workers respectively and take care that in case duties 
have to be paid they should be laid out; please see to it that Orgell refunds 
the money to you later; this was the simplest and the only way by which the 
badges could be sent in order to arrive on time. 

With the German people s greetings, 

E. A. VENNEKOHL. 



These documents in the hands of the Dies Committee show 
definite tie-ups between German propaganda divisions and 
agents in the United States (some of them came through the 
Nazi diplomatic corps) , yet these documents were put aside. 
The letters from True, Allen, and others quoted in the previous 
chapter were also placed before the Congressional Committee. 
It refused to call the men involved. 



THE DIES COMMITTEE SUPPRESSES EVIDENCE 153 







^^ 



Vf l. .Jarttot**,*. 18* *^ 1938 



H.rro 

Peter Gtsslbl 
AKerlka-Dautscbar 
H. Wester a 



C b i c a o , III. 

uisiir* 

Lleber Peter 1 

Von Deinem Awtstrlger, <!eo Kanareden Uglier, erblelt leb uc,*r 
ec 15. Februar eln Schrelben. 2r tellta air u.a. ait, daaa 
clo Austausoh voa Jugendlichen fur dieses Jabr nloht aebr ID 
Trage kommt. Icb bedauera das aebr. Ich b&tta as la Inter essa 
unserer gemelnsamen Bestrebungen sebr gerna geoahen, weoa wlr 
beralts ID die>ed Jahra, gerada auob aua luraa Kreiaa, Jogeadllobt 
hler gehebt -batten. Vlelleloht lasat .sicb alt Delner Uoter- 
atutzung dieaa HOfflUhkait doch noob sobaffen. Dla Zeit, die 
noch zur VarfUgung etcht, 1st allerdinga aabr Imapp be 
ParUber bio Ich air durchaus im klarao. 

Zeb warda Dir demoacbst wiadar auafUhrliober aebreibeo. IB dar 
Zwlceheozalt kanns Du air Yielleleht oahera Aogaben Uber die 
Entwicklung Delner Sobula wahrand dar letztan Woobeo Ubarmitteliii 
tint trfUllung Delner bareobttgtao WUnaoha baba ich erneut aufa 
warncta befurwortat* Hoffentlieb lasst sleh aucb sehr bald da* 
Zrgebnl* *rzi*lan um das wlr 69n*U0oa bestrebt olnd. 

Herzllche OrUss* TOR Bauo sa Haua 

io vuer Xaaaradtebaft 




Another letter connecting Gissibl with a German propaganda agency. This 
letter, translated in the text, was hardly noticed by the Dies Committee. 



154 SECRET ARMIES 



bo* ettttmtt hn 



9m*. feprttMMfe X Qtrfto TO 8Z. ffirlffir. 22; 



fcf9rf*: Vel/Gr. 3V3** <Sttnn <3SJ 30, bt 20. Mai 1938 

H.rt<l.eu$T.0tT. 

0n.tif 39I$5 



Earrn 

Peter Cllbl 



3855 North Western Art. 



CM c ago p 111. 
U.S.A. 



Lieber Komerad GlsslblT 

Wlr schrleben Ihnen gsteni, dasa die 3*000 S&ngerfeatplejkettea 

Uber Orgell an -Si -geleltet vUrden. Aua verachledenen GrUndeB 

ia"ben wlr die PlaJcetten Jetzt In zehn Zlnzelpakete vertcilt, 

ron denen je zwel anfolgende *nschriften gingen: 

Prledrlch Schlena, Karl Koeller, Karl Kraenzle, Orgell und zwcl aa 

Sle. 

Bltte informleren Sle Ihre Hitarbelter entsprechend und tracea 

Sle Sorge, dass die etwalgen Zollspesen rerauslagt werden. .Dlese 

wollen Sle sich spater von Herrn Orgell zurxlckvergtiten lassen. 

Is war dies der elnfachste und elnzlgste Weg, auf dem die Plakettte 

Tersandt werden konnten, ua rechtzeltlg drxlben elnzutreffen. 



Hit volkedutsche 




X.A. Vennekohl 



Further evidence of Gissibl s tie-up with the People s Bund for Germans Living 
Abroad. This letter, a translation of which appears in the text, was also long 
withheld by the Dies Committee. 



Conclusion 

The activities of the few agents and propagandists described 
in the foregoing chapters do not, as I said in the preface, even 
scratch the surface of what seem to be widespread efforts to 
interfere in the internal affairs of the American people and their 
Government; but a few basic conclusions can reasonably be 
drawn from what little is known of the Fifth Column s 
operations. 

Berlin-directed agents in foreign countries sometimes combine 
propaganda and espionage, frequently using the propaganda 
organizations as the bases for espionage. In the United States, 
so far as I have been able to ascertain, agents of the Rome- 
Berlin-Tokyo axis are just beginning to cooperate. In the Cen 
tral and South American countries, however, the axis has 
apparently agreed to a division of labor, each of the fascist 
powers assuming a specific field of activity. 

Germany, Italy and Japan have already shown the extent to 
which they will go in their drive for raw materials vital to their 
industries and war machines. In Spain, the German and Italian 
Fifth Column organized and fomented a bloody civil war in 
order to establish a wide fascist area to the south of France, 
for Germany and Italy, of course, consider France a potential 
enemy in the next war. In France itself, German and Italian 
agents, aided by their Governments, built an amazing network 
of steel and concrete fortifications manned by at least 100,000 

155 



156 SECRET ARMIES 

heavily armed men all this before France awoke to the treason 
within her own borders. 

The strategy pursued by the Fifth Column in different coun 
tries falls into like patterns. In Austria, before it was swallowed, 
Nazi agents first established propaganda organizations as the 
bases from which to work. When, after the abortive attempt to 
seize the Austrian Government, the Nazis were made illegal, 
they went underground but continued to get aid from Germany. 
Eventually Berlin ordered Standarte II organized as a specific 
body prepared to provoke disturbances. When the Austrian 
police quelled them, the provocations enabled Germany to 
protest that German citizens were being attacked and mistreated. 
The activities of Standarte II, directed by the Gestapo, con 
tinued with increasing intensity until the unfortunate country 
was absorbed. 

In Czechoslovakia the same strategy was followed: first the 
establishment of propaganda centers to which Nazis and Nazi 
sympathizers could gravitate under the cloak of bodies seeking 
to improve relations between the Sudeten Germans and the 
Czech Government; then the utilization of propaganda head 
quarters and branches as centers for espionage. Shortly before 
the Munich Pact, Standarte II again came into being, creating 
disorders which, when Czech police tried to suppress them, 
enabled Germany to raise the cry that Czech subjects of German 
blood were being cruelly mistreated. 

Invariably the aggressor nation raises a moral issue to cover 
up proposed acts of aggression. Italy wanted to "civilize the 
Ethiopians" by dropping bombs on defenseless women and 
children. Germany and Italy openly sent aid to Franco "to keep 
Spain from being Bolshevized." And so on. The broad "moral 
issue" on the international field to cover up aggressions by the 
Rome-Berlin-Tokyo axis is "Communism." The axis, announced 
as having been formed "to exchange information about Com 
munism," is really a military alliance now generally recog- 



CONCLUSION 157 

nized. With the same issue, the axis is now boring into the 
Western Hemisphere. Actually the reasons seem to be military 
and not missionary. 

Germany, especially, has sent and is sending agents not only 
to carry on espionage but to organize groups for political pres 
sure upon the American republics. I very much doubt, from 
all I have been able to learn, if the motive is primarily to win 
the Americas over to the joys of totalitarian government or to the 
theory of Aryan supremacy. The money and the effort seem 
to be expended for more practical reasons. The Bunds can 
exert not only political pressure, but can develop natives with 
fascist leanings into the spies and saboteurs so badly needed in 
war time; for this reason it is worth the enormous effort and 
money it is costing the aggressor nations. 

When the long expected war breaks, neithei Europe nor the 
Far East will be in a condition to supply war materials and 
foodstuffs to the warring countries. The chief sources of raw 
materials will be the Western Hemisphere. A strong foothold in 
the Americas means a tremendous advantage in the coming 
struggle, since materials are as important to an army as is man 
power. And, should the fascist powers be unable to get these 
raw materials for themselves, secret agents can at least sabotage 
shipments to enemy countries as did German agents in the 
United States during the first years of the World War, while 
we were still neutral. 

Mexico, because of its enormous oil supplies, plays an im 
portant part in fascist military strategy. Consequently, we find 
intensive efforts by the axis, and especially Germany, to over 
throw the Cardenas Government because it is avowedly anti 
fascist. A fascist government, helped into power by the Rome- 
Berlin-Tokyo axis, could be depended upon to supply much 
needed oil in war time. 

The United States, as one of the world s greatest sources of 
raw materials and foodstuffs, is an even more important factor. 



158 SECRET ARMIES 

Germany has not forgotten that its armies had the Allies on their 
knees when American supplies and American man power turned 
their imminent victory into defeat; should America be on the 
side of the democracies as against the fascist powers, sabotaging 
shipments of supplies and men will be as important as crushing 
an enemy line. 

The tactics utilized in the Western Hemisphere by the Fifth 
Column are similar to those used in Europe. Propaganda ma 
chines, masquerading as organizations designed to promote 
better relationships between a fascist and an American nation, 
are set up. Fascist movements are organized, usually from across 
national boundaries. In Mexico, Nazi agents operating out of 
the United States organized the Gold Shirts; subsequently, as 
in Austria, a Putsch was attempted (in 1935 and again in 1938) . 
The storing of arms in Sonora by General Yocupicio, who is 
working with Nazi agents, promises another rebellion when the 
time seems ripe. 

In Central America, the axis is presenting small republics with 
gifts of arms in efforts to win their friendship. Agents sent from 
Germany are establishing Nazi centers and the home Govern 
ment is supplying them with propaganda. In Panama the situa 
tion is somewhat more sharp. There Japan has always had an 
intense interest in the Canal. In the axis, Germany has become 
a co-worker since she has large colonies in Brazil and Colombia, 
next door to the Panama Canal. These colonies are now being 
organized at a feverish pace while the countries themselves are 
deluged with propaganda over special short-wave beams. In 
Brazil, a Nazi-directed abortive Putsch took place in 1938. 

These activities point to an objective which certainly is not 
calculated to be in the interest of the United States and our 
Monroe Doctrine. From all indications the efforts appear 
directed toward ringing the United States with fascist countries, 
or at least countries with fascist bodies capable of giving the 



CONCLUSION 



159 



United States a headache should she ever be involved in a war 
with one or all of the axis powers. 

In the United States itself we find that the strategy is the 
same as that followed in Austria, Czechoslovakia and in coun 
tries of the Western World. The German-American Bund func 
tions "to promote better relations between the United States 
and Germany," but the efforts consist of persistent anti-Ameri 
can and anti-democratic propaganda and, within the past year 
or two, of serving as a base for military and naval spies. 

With Germany directing the strategy, her agents in all coun 
tries raise the issue of the "menace of the Jew and the Catholic," 
with especial emphasis upon the Jew; the Catholics are still 
too strong for the Nazis to come to grips with at this time. 

The Federal Government, of course, has ample legal machinery 
for prosecuting spies, but espionage is only part of the broad 
Nazi campaign against this democratic Government. So far as 
the Western World is concerned, the Federal Government has 
already taken steps to try to counteract the short-wave broad 
casts by German and Italian government-controlled stations. 
Counter broadcasts are being employed as a defensive measure, 
and though of value, will probably not completely counteract 
fascist "news" agencies supplying propaganda in the guise of 
news, free of charge, to the Central and South American news 
papers as well as printed propaganda sent from Germany and 
distributed by the bunds. Outside of military action, economic 
pressure seems to be the only language the fascist governments 
understand, and a little of that pressure by the American Gov 
ernment would probably make them understand our resentment 
at their invasion far more than broadcasts and general talk 
about a family of nations in the Western Hemisphere. 

Our laws and courts provide a machinery which can be used 
to prevent any infringement upon the democratically constituted 
rights of the people. It is of vital importance, however, that 
preparations for fascist lawlessness be vigilantly uprooted. The 



160 



SECRET ARMIES 



Italian and German people made just this fatal mistake of 
tolerating the activities of Mussolini s and Hitler s gangs until 
they grew strong enough to seize power and crush every sign of 
democracy. 

There is no reason why a great people, attacked by a per 
nicious ideology, cannot counteract such propaganda with 
greater and more intelligent propaganda to educate our people 
to the advantages of democracy to what fascism really means 
to everyone, including the big industrialists and financiers, some 
of whom have been flirting with fascism. The Government, 
however, can and should be instructed by the representatives 
of the people, to take proper steps to stop the infiltration of 
Nazi agents and propagandists into this country. 

There are various other and perhaps more practical and useful 
steps which can be taken, but those can be worked out once 
the people awake to the danger of permitting fascist propaganda 
to go on, and sentiment becomes strong enough to put an end 
to foreign-directed activities here. 

THE END 



This book has been produced 
wholly under union conditions. The paper was 
made, the type set, the plates elect retyped, and 
1he printing and binding done in union shops affili 
ated with the American Federation of Labor. All 
employees of Modern Age Books, Inc., are members 
of the Book and Magazine Guild, Local No. 18 
of the United Office and Professional Workers 
of America, affiliated with the Congress 
of Industrial Organizations.