The Bank of England's dirty secret

The BofE is airing its dirty laundry on the web: According to documents revealed online on Tuesday, in 1939 the BofE helped Nazi officials sell about £1 million worth of gold the German Reich had stolen from occupied Czechoslovakia, The Guardian reports.

Now, 74 years later, the British bank has shed light on this dark moment in its history.

According to The Guardian's review of these files the Czechoslovakian government – fearing its expansion-minded German neighbor – had deposited £5.6 million worth of gold bars with the Bank of International Settlements (BIS) for safekeeping.

In March 1939, as the Reich occupied Czechoslovakia, Nazi officials requested that the BIS transfer the Czech gold to Germany's account. From there, the Nazis distributed the bars to the Netherlands, Belgium and London to be sold by these central banks.

At the time the BIS chairman was Otto Niemeyer, a German who also happened to be the BofE's executive director. Together with Montagu Norman, the governor of the bank at the time, the two facilitated the sale of the stolen goods mostly to markets in New York.

As the BIS applied pressure on the the "Old Lady" to speed up the transactions, the historical accounts – which were written in the 1950s – show the historian's belief that it would have been "'wrong and dangerous' for the future of BIS if Governor Montagu Norman had taken any other course of action," The Telegraph writes.

Image from Wikimedia Commons

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