Nazi looted property in the United States in the 1930s

by Marc Masurovsky

Adolf Hitler and his National Socialist movement came to power in Germany on 30 January 1933. The subsequent Nazi era lasted until May 9, 1945, when the National Socialist Third Reich signed an unconditional surrender to the combined Allied military forces which brought an end to a six-year global military conflict known as the Second World War (1939-1945).

In the winter of 1933, there were at least 400 American companies and businesses operating inside Nazi Germany, most of which were subsidiaries of American-based corporations. There were also American-based banks and financial firms as well as businesses displaying, buying and selling art objects. For Americans, Hitler’s coming to power was but a hiccup, for otherwise it was business as usual. For the Jews of Germany and for American Jews, Hitler’s arrival was cause for concern and rightly so.

America’s borders remained open as well as Germany’s. Therefore trade relations between the US and Germany were maintained even if the political checkerboard had changed radically and Germany’s priorities were rooted in a deeply racialist, white supremacist and antisemitic ideology.

The first expropriations of Jewish property began several months after the Nazis took power. The first forced sales accompanied these expropriations in the form of auctions taking place across Germany. Items sold included everything that one could find in a Jewish household, including art objects, precious metals like gold and silver, furniture and decorative objects.

Tourists continued to flock into Germany, despite the economic depression that was engulfing the US, but those who had deeper pockets than the average working person could still afford to “have a good time” in Germany. Tourists usually bring back souvenirs so it’s no surprise if some of the more enterprising ones attended auctions where Jewish property was being sold willy-nilly.

Art collections were being sold under duress. Their owners were persecuted for being Jewish, deprived of an income and therefore forced to sell their belongings in order to fund their exit from Nazi Germany. Their property was dispersed among the local population but it was also acquired by foreign visitors who had a special interest in the art objects and the decorative pieces offered for sale. This illegal outflow of Jewish property reverberated inevitably into the countries of origin of these foreign buyers who returned home with their acquisitions.

As a growing number of Jewish collectors and dealers were being forced out of their professions and obliged to sell their inventories, gallerists and dealers in neighboring countries and the United States saw their demise as a business opportunity for them to acquire at depressed prices items of value which could then be resold for a hefty profit in due course.

Likewise, German art dealers, collectors, museum curators and art historians who had established productive relationships with their counterparts in the US crossed the Atlantic in search of good deals, especially Old Master paintings, on behalf of their wealthy clients. The lines were continually blurred between American and German art world personalities owing to their symbiotic business and scholarly relationships. The same can be said about American university professors and researchers who continued to exchange data and research with their German colleagues and even fostered exchange programs that saw American students and professors spending time on German university campuses after Hitler’s rise to power.

As the years progressed and the ensuing repression intensified against Jews in Germany, an exponential mass of high-value tangible assets changed hands from Jewish to non-Jewish ownership through a pseudo-legal process known as “Aryanization,” a direct result of anti-Jewish laws being enforced to the letter by Nazi administrators. Corporate boards were purged of their Jewish members, while business continued to flow between American subsidiaries, their German clients and the Nazi State. Profit before people. A well-known adage that witnessed a perverse application in the antisemitic German world.

By the late 1930s, Germany had brazenly announced its true colors: territorial expansion and elimination of Jews from all walks of life. Genocide was around the corner. Faced with an appeasement-oriented world that wanted to keep Hitler at bay without antagonizing him, Nazi Germany took it as an invitation and absorbed its neighbor, Austria, in an “Anschluss” in early March 1938, followed a year later by a so-called “police action” against Czechoslovakia which resulted in the disappearance of that country and its replacement with a "Protectorate of Bohemia and Moravia." Similarly, Austria became Germany’s new province of Ostmark.

If one surveys the New York auction world as of the mid-1930s, one is likely to read about objects coming out of privately-owned Jewish collections which were subjected to seizure and forced sales. German dealers and collectors, specializing mostly in 20th century art, emigrated to the United States bringing with them parts of their inventories which, if scrutinized properly, would have revealed the presence of objects acquired from Jewish collectors and artists who were subjected to duress and forced to sell, or that they had acquired at “Jew auctions.” These objects in turn were displayed in New York galleries and other American cities with few questions asked about provenance. We call it willful ignorance.

Lastly, American businessmen were accustomed to travel to European art fairs and pick up merchandise for their businesses back home and they would sign trade agreements with local European partners including German ones. The Leipzig trade fair, for instance, was flagged by the US Treasury Department as an international event which was suspected of offering for sale expropriated Jewish household goods, including textiles (rugs and wall hangings). This is just one of many instances of how easy it was for foreign businessmen to acquire property displaced from Jewish owners without their consent.

Jewelry was the easiest commodity to move from one border to the next due to its small size. As Jewish jewelers and precious stone brokers were put out of business, their inventories were cast wide on the market and often ended up across the ocean. Although extremely difficult to trace back to original owners, these luxury items were dispersed in urban centers along the East Coast of the US.

In summary, art, decorative objects, jewelry and textiles were some of the many categories of objects which made their way to the United States in the 1930s, unbeknownst to the buyers who had no idea that they had once belonged to a Jewish owner suffering under the Nazi yoke and forced to sell them in order to stay alive. But for how long?

Heirless Jewish property and treasure hunting in the Czech Republic

Ever since the end of the Second World War, politicians, diplomats, officials and bureaucrats in leading international Jewish organizations, non-governmental organizations, scholars, and historians alike have butted heads on what to do with so-called “heirless” property, or property for which no rightful owner can be found because, for the most part, the family line was extinguished by genocide and war.

There still is no resolution as to how to treat this problem that spreads discomfort and awkwardness across continents, especially among cultural institutions that are the custodians or owners of objects that can be described as “heirless.” What to do? Do we leave them where they are in display cases or on shelves in museum or gallery warehouses as mute witnesses to the horrors of a recent genocidal past? What if they can be connected to a specific geographic location? Do we then return them to the place from which they might have been collected before their owners were wiped off the face of the earth?

Or do we sell them and use the proceeds of the sales to help needy survivors and their families? A solution that has long been advocated by many Jewish groups and Israeli officials.

Meanwhile, back at the ranch—so to speak—treasure hunters are busy searching for the fruits of plunder abandoned or left behind in secret hideaways by fleeing and highly-resourceful Nazi officers and officials in the waning hours of the Second World War. One set of enterprising Nazis presumably buried over 500 crates filled with treasure and documents inside shafts and underground galleries near Štěchovice, about 30 miles from Prague (Praha). A Florida-based treasure-hunting firm, Assets Restitution International (ARI), has struck a deal with the Czech government to acquire “20% of the value of assets recovered...” This agreement includes a right of first refusal “on all heirless assets.”

While the Czech government makes it nearly impossible for the heirs of Jewish victims to recover property that was stolen by the Nazis and their sympathizers between March 1939 and May 1945, it sees fit to allow treasure hunters to garner their pockets with recovered Jewish property, whether identifiable or not. According to ARI, the potential value of recoverable property might exceed one billion dollars.

Perhaps, the Czech government should steer clear of these fun projects and abide by its international commitments to aid the remaining group of Holocaust survivors recover their property instead of harassing them by erecting countless legal and political roadblocks to prevent them from recovering anything under the sham pretext that the State has superior rights to all of those assets.

To be continued...

May 1945 and beyond

The Second World War is over in Europe and North Africa. The Third Reich no longer exists. The only active military front is in Asia where the Japanese Imperial Army continues to put up fierce resistance to American-led troops. That all comes to an end with the detonation of two atomic devices, one over Hiroshima and another over Nagasaki, in early August 1945.

60 million people are known to have died as a direct result of the Second World War. This figure includes six million Jewish men, women, and children exterminated in death camps, ghettos, forests, fields, marshes, and concentration camps. It also includes at least 5 million men, women, and children of other faiths decimated in concentration camps, forced labor, in villages and cities across Axis-occupied Europe. The remainder died in the crossfire between rival armies, as victims of reprisal killings, from hunger, disease, and exposure to the elements.

The victorious Allied powers set in motion policies to effect the repatriation of assets looted by the Axis to the countries from where they were forcibly removed. While laying down complex reparations formulae that leave no country satisfied, they also lay claims to assets owned by the Reich and its collaborators in countries often referred to as ‘neutral’, viz., Sweden, Spain, Portugal, Switzerland, and to a far lesser extent, Turkey, and Argentina.

Restitution is often confused with repatriation, but one thing is certain, restitution can only mean one thing: return of a stolen object to its rightful owner.

France and the Soviet Union argue for replacement policies—to replace objects stolen from them with objects of similar quality and value in the current possession of the defeated powers. The United States and Great Britain oppose such a move. While France continues to press for replacement into the early 1950s, the Soviet Union does not quibble over words and policies. It is busy removing untold numbers of items, equipment, and other goods from countries that the Red Army overran in its bid to defeat the Third Reich as partial payment for its losses—both infrastructural and human. One out of every three Soviet male between the ages of 17 and 45 is dead or unaccounted for at the end of the global conflict.

It is fair to say that 90 per cent of all those involved in direct fashion with the cultural plunder of Europe escaped severe punishment, with the notable exception of Alfred Rosenberg and a handful of his acolytes.  The rest faced mostly fines, escaped prosecution altogether, and few were tried and handed down light sentences. 

Every formerly occupied country in Europe busily enacts laws that restrict the ability of victims to recover items plundered by fellow citizens. Most egregious are the waivers granted to so-called third-party transactions: all individuals who were involved in brokering forced sales and illegal removals of property are granted the benefit of the doubt, lest it be explicitly proven that they knowingly handled items which had been misappropriated for racial and other reasons.  Worst of all: the main proponent of postwar restitution, namely the United States, walks away from the restitution process in the early 1950s, feeling that the job was 'well done', ignoring the plight of claimants who by then have become naturalized US citizens.

No one has done an accounting of the numbers of claimants who actually obtained restitution of lost items and assets.  Judging by the number of victims, their surviving next of kin, the figures can only be ridiculously low--in the single percentile digits.

Where are all the looted objects, aside from those which victorious armies recover by the truckloads in the aftermath of victory?

From East to West:

• items removed from Soviet territory, Hungary, Czechoslovakia, and Poland, find their way into Germany, Austria, and Switzerland. For instance, many cultural objects stolen in Poland are discovered in the French zone of Occupation in Germany, while Russian icons, books from the Ukraine and private collections from Latvia end up in various parts of Austria and Germany.  Although a percentage of those items are repatriated to the Soviet Union, the picture is unclear as to their numbers and the percentage that they represent of all items recovered by Allied forces.
• items from Yugoslavia enter Italy, Austria, and Switzerland.
• items from Italy go north to Switzerland, Germany, and Austria, as well as west to Spain and France (after August 1944).
• items from France, Belgium, Holland, travel to Italy, Spain, Germany, and as far as Austria and Poland, and in some cases even to German-occupied Ukraine where Belgian books looted by the ERR find a final resting place.
• items discovered in the various zones of occupation controlled by Great Britain, the United States, France, and the Soviet Union in Germany and Austria will never be properly repatriated and/or restituted and, instead, are transferred to the territories of the occupying powers.

Meanwhile, the international art market continues to thrive unabated. Art dealers and museum officials, especially in the United States, press the US military to release unclaimed items and entrust them with their sale and safekeeping since their owners are more than likely dead.  Jewish relief organizations confuse recovery with rehabilitation and are quick to sell items that might be restitutable so that they can obtain quick cash, granted, to assist survivors.  However, a significant number of choice items end up in libraries and collections, in Europe, North America, and Palestine, sometimes at the expense of recovering Jewish communities in liberated Europe.

Plundered items infest bustling black markets across Europe; their sheer numbers make it impossible for local and Allied police and investigative agencies to intercept them. As a result, these items will slip through export restrictions and end up in collections as far away as Argentina.

The residual problem of World War II and Holocaust-related plunder is a global problem since, if half of what has just been put forth is correct, looted items are to be found everywhere, both in private and government hands. If we want to resolve this question in a way that is acceptable to all parties, knowing full well that full, 100 per cent restitution was--and will never be--possible, all countries involved must come to the table and carve out a solution which allows them once and for all to close the book on one of the worst chapters of human history. Failing that, all that we have accomplished is to inform the next generation that plunder is permissible and the passage of time allows the thieves to enjoy the fruits of their mischief without fear of accountability.