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The dishonest intentions of Germany appear in a secret
report by Seyss-Inquart on his governorship, a report,
discovered by the U.S. Army, dated 29th May to 19th July
1940, which has been registered as Document 997-PS and which
I submit before the Tribunal as Exhibit RF 122. These are
the chief extracts from this report:

"It was clear that with the occupation of the Netherlands a
large number of economic and police measures had to be
taken, the first ones of which were to reduce the
consumption of the population in order to get supplies for
the Reich, on the one hand, and to secure a just
distribution of the remaining supplies, on the other hand.
In consideration of the assigned task, we had to try to see
to it that all these measures carried the signature of
Dutchmen. The Reich commissioner therefore authorised the
Secretaries-General to take all the necessary measures by
means of ordinances.

As a matter of fact, up to today, almost all orders
concerning the seizure of supplies and their distribution to
the population, and decrees about restrictions in the
formation of public opinion, which have been issued, as well
as agreements concerning the transport of extraordinarily
large supplies to the Reich which

                                                   [Page 23]

have been made, all bear the signatures of the Dutch
Secretaries General or the competent economic leaders, so
that all of these measures have the character of being
voluntary. It should be mentioned in this connection that
the Secretaries General were told in the first conversation,
that loyal co-operation was expected of them, but that it
would be their privilege to resign if something should be
ordered which they felt they could not endorse. Up to date
none of the Secretaries General has made use of this
privilege, so that one may reasonably conclude that they
have complied with all requests of their own free will.

Almost the entire seizure and distribution of food supplies
and textiles has been carried out, at least all the
respective orders have been issued and are being executed.

A series of instructions concerning the reorientation of
agriculture have been issued and are being executed;
essentially it is a question of seeing to it that the
available fodder is used in such a way that as large a stock
as possible of horned cattle is carried over into the next
farming period, about 80 per cent, at the expense of the
stock of chickens and hogs, which is too high. Rules and
restrictions have been introduced in the organisation of
traffic, and the principles for the regulation of gasoline,
as in the Reich, were carried out here.

Restrictions of the right to quit jobs as well as to cancel
leases have been issued, in order to check the liberal-
capitalistic customs of the Dutch employers and to avoid
unrest. In the same way the periods for repayment of debts
have been extended under certain conditions.

Ordinances concerning news service, radio, etc., prohibit
listening to foreign radio stations and introduce all other
restrictions necessary in this field for defence reasons.
The ordinance about registration and control of enemy
property, as well as about confiscation of the property of
persons who show hostility to the Reich and to Germans was,
in this case, issued in the name of the Reich Commissioner.
On the basis of this ordinance an administrator for the
property of the Royal Family has already been appointed.

The supplies of raw materials have been seized and, with the
consent of the General Field Marshal, distributed according
to this system: the Dutch keep enough raw materials to
maintain their economy for half a year, whereby they receive
the same distribution quotas as in the Reich. The same
principle of equal treatment is being used in the supply of
food, etc. This enabled us to secure considerable supplies
of raw materials for the Reich, as for instance 70,000 tons
of industrial fats, which is about half the amount which the
Reich lacks.

The bank moratorium could be cancelled; bank deposits are
increasing the stock exchange has been reopened to a limited
extent. Legislation concerning the control of foreign
currencies has been introduced according to the standards in
the Reich.

Finally it has been arranged that the Dutch Government shall
make available, in sufficient quantities, all means needed
by the Reich, including the German administration in the
Netherlands, so that these expenses do not burden the Reich
budget in any way.

Thus, a sum of guilders has been made available to redeem
the occupation marks to the amount of about 36 million, an
additional 100 million for the purpose of the occupation
army, especially the extension of the airports; 50,000,000
for the production of raw materials to be shipped to the
Reich, insofar as they are not booty; for unrestricted
transfer to guarantee the remittance of the savings of the
Dutch workers brought into the Reich to their families, etc.
Finally, the rate of exchange of the occupation marks, set
at first by the Army High Command as I guilder to 1.50
Reichsmark, has been correctly reduced to 1 guilder to 1.33
Reichsmark.

Above all, however, it was possible to get the consent of
the President of

                                                   [Page 24]

the Bank of the Netherlands, Trip, to a measure suggested by
Commissioner General Fischbock and approved by the General
Field Marshal, namely the unrestricted mutual obligation of
accepting each other's currencies; that means that the Bank
of the Netherlands is bound to take over any amount of
Reichsmark offered to it by the Reich Bank, and in return to
make available Dutch guilders at the rate of 1,33, that is,
1 Reichsmark = 75 cents. Only the Reich Bank has control
over this, not the Bank of the Netherlands, which will be
notified only about the individual transactions. This ruling
goes far beyond all pertinent rulings hitherto made with the
political economies of neighbouring countries, including the
Protectorate, and actually represents the first step toward
a currency union.

In consideration of the significance of this agreement,
which already touches the independence of the Dutch State,
it is of special weight that the President of the Bank,
Trip, who is unusually well-known in Western banking and
financial circles, signed this agreement of his own free
will in the above sense."

Here ends the quotation from the letter of Seyss-Inquart.

As you will see from the explanations which I shall have the
honour of submitting to you, it was chiefly in the
Netherlands that the Germans used all their ingenuity in
extorting the means of payment. This spoliation will form
the subject of the first chapter.

We shall next examine the use made by the occupants of these
means of payment; in a second chapter we shall discuss the
black market; in a third we shall consider the acquisition
made in a manner only outwardly regular; a fourth chapter
will be devoted to various kinds of spoliation. Finally, we
shall touch upon the chief consequences to the Netherlands
of this economic pillage.

FIRST CHAPTER: GERMAN SEIZURE OF MEANS OF PAYMENT

I. INDEMNITY FOR OCCUPATION COSTS

I have already had the privilege, gentlemen, of explaining
under what conditions and within what limit, by virtue of
the Hague Convention, the occupying power may raise
contributions in money for the maintenance of its army of
occupation.

I shall confine myself to reminding the Tribunal that these
expenses which are charged to the occupied countries can
include only costs of billeting, feeding, and eventually of
paying those soldiers, strictly necessary to the occupation
of territories.

The Germans knowingly ignored these principles by imposing
upon the Netherlands the payment of an indemnity for the
maintenance of their troops which was far out of proportion
to their needs.

According to information furnished by the Netherlands
Government, (which is contained in three reports: the
reports of Trip, Hirchenfeld and the Minister of Finance,
which I submit as Exhibit RF 123) the following sums were
exacted on the pretext of being indemnity for the
maintenance of occupation troops:

1940, (for the duration of seven months) 477,000,000
guilders
1941                                   1,124,000,000
guilders
1942                                   1,181,000,000
guilders
1943                                   1,328,000,000
guilders
1944                                   1,757,000,000
guilders
1945 (for the duration of only 4 months) 489,000,000
guilders
Total                                  6,356,000,000
guilders

A sum as considerable as this constitutes a veritable war
tribute raised on the pretext of the maintenance of an army
of occupation.

                                                   [Page 25]

Germany thus fraudulently circumvented the regulations of
the Hague Convention to seize a considerable amount of means
of payment.

II. CLEARING

In 1931 Germany, which faced economic and financial
difficulties, declared a general moratorium on its previous
commitments. Nevertheless, in order to be able to continue
its foreign commercial operations, it had concluded with
most of the other countries, notably with Holland,
agreements making possible the regulation, the settling of
commercial debts and, to a certain extent, of financial
debts, on the basis of the compensation system called
"clearing." Before the war there existed on the Netherlands
"clearing" an excess of imports from Germany. But after the
first months of occupation there was, on the contrary, a
considerable excess of exports to Germany, whereas the
receipts coming from that country dropped perceptibly.

From the month of June 1940 on, the Germans exacted from the
Netherlands declarations of foreign currency, gold, precious
metals, valuable papers, and foreign credits, as can be
deduced from the Ordinance of 24th June 1940, hereby
submitted as Exhibit RF 95. Moreover, the Dutch could, by
virtue of the same ordinance, be obliged to sell their
stocks to the Bank of the Netherlands. The German Commissar
of the Reich, Seyss-Inquart, forced the Bank of the
Netherlands to make advances in guilders to assure an
equilibrium of the clearing, since Germany could furnish no
equivalent in merchandise. On the other hand, it was decided
that the clearing system should be utilised for the delivery
of merchandise as well as for the payment of any debts.

In point of fact the Germans could, therefore, buy
merchandise and titles to movable property in Holland
without furnishing any equivalent. The credits, in marks, of
the Dutch sellers were blocked in the Bank of the
Netherlands which, on its part, had been obliged to make an
equivalent advance on the clearing exchange.

To attempt to limit the falling of the Dutch account on the
clearing exchange, and to avoid the transfer by this means
of guilders or of transferable stock into Germany; on the
8th of October, 1940, the Secretary General of the
Netherlands Finance imposed a sizeable tax on the marks that
were blocked on the clearing exchange.

However, under date of the 31st of March, 1941, the credit
of the Netherlands exceeded 400,000,000 guilders, which in
fact had been advanced by the Netherlands Government. At
this point the occupant's demanded:

(1) That a sum of 300,000,000 guilders be withdrawn from the
balance of 400,000,000 and deposited in the German treasury
under the heading of "Military Occupation Costs Incurred.
'Outside' The Netherlands," and this independently of
payments already made for the occupation costs that had been
paid by this country.

(2) By a decision of the Reich Commissar, under date of 31st
March, 1941 (reported in the Verordnungsblatt in France, No.
14, which I submit to the Tribunal as Exhibit RF 124) the
payment operations with the Reich were no longer to pass
through the clearing exchange, but to be operated directly
from bank to bank, which would create direct credits of the
Netherlands banks on the German banks at the imposed
exchange of 100 Reichsmark for 75.36 guilders.

(3) By a decree of the same date, 31st March 1941, (which I
submit as Exhibit RF 125) the tax on blocked marks, created
on the 8th of October, 1940, by the Netherlands authorities,
was abolished. Faced with this situation, particularly
dangerous to the Netherlands treasury, M. Trip resigned his
position as Secretary General for Finance and President of
the Netherlands Bank. The Reich Commissar replaced him with
Rost von Tonningen, a

                                                   [Page 26]

notorious collaborator who complied with all the demands of
the occupying power.

As the private banks were unwilling to keep credits in marks
at a rate very disadvantageous to the real parity of 100
Reichsmark to 75.36 guilders, they transferred their credits
in marks to the Bank of the Netherlands. The credit account
of the Institute of Exports to Germany, through the
operations made with this country, rose considerably; while
the credit balance as of 1st April 1941 amounted to
235,000,000 guilders, it was to rise by the 1st of May,
1945, to 4,488,000,000 guilders.

According to information given by the Netherlands Government
this credit was accounted for by purchases of all kinds of
merchandise made by the Germans in Holland, of transferable
stock or other valuable papers, by payment of services
imposed upon Dutch businesses, and of wages of workers
deported to Germany, and by paying off the debts incurred by
the occupant.

Aside from these two procedures, indemnities for the
occupation troops, and clearing, the Germans were to procure
resources for themselves by another method - by imposing
collective fines - and this in violation of the provisions
of Article 50 of the Hague Convention.

In the course of the occupation the Germans imposed, under
every pretext, by way of reprisal or intimidation,
considerable fines upon the municipalities. These fines were
to be paid by the inhabitants, with the exception of persons
of German nationality, members of pro-Nazi associations
(NSV, Waffen SS, NSKK), of the technical aid services of the
Dutch-German community, and of persons working for the
Germans.

According to information which has been obtained up to the
present of only 62 municipalities, the total fines thus
imposed mounted to a minimum of 20,243,024 guilders. This is
based on testimony of the Netherlands Government, which I
submit as Exhibit RF 126.

From the same testimony, in the archives forgotten by the
Germans at the Hague, there have been discovered two copies
of letters relative to these collective fines.

According to the first of these copies, which is a letter of
March 8th, 1941, collective fines amounting to 18,500,000
guilders had been raised at the beginning of the year 1941.

From the second, we learn that Hitler had given the order to
employ this sum for National Socialist propaganda in the
Netherlands.

The report of the Government of the Netherlands....

THE PRESIDENT: Where are these letters?

M. GERTHOFFER: These letters are in evidence, which I
presented as Exhibit RF 126.

THE PRESIDENT: Will you read the passages which you consider
material?

M. GERTHOFFER:

   "Commissar of the Reich, The Hague, 1808, 8.3.1941.
   
   To Liaison Headquarters, Berlin, 1720 hours.
   
   For immediate transmission to Reichsleiter M. Bormann.
   
   The sum of 18 1/2 million guilders representing the
   contribution exacted as reprisals from certain Dutch
   cities, will arrive in the next few days. The Commissar
   of the Reich asks whether the Fuehrer has earmarked this
   sum for a special purpose, or if it is to be used for
   the same purpose as the Fuehrer has previously ordered
   in the case of confiscation of enemy property. At that
   time the Fuehrer stipulated that these sums should be
   spent in the Netherlands for the needs of the community
   under the proper political considerations.
   
   Heil Hitler
   (Signed) Schmidt-Munster
   General Commissar."

                                                   [Page 27]

This, then, is the translation of the answer.

   "Obersalzberg, 19.3.41; 1000 Nr/4
   
   Reichsleiter M. Bormann."


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