Nazis Spread Fake British Notes During World War II

By Jack Phillips

Epoch Times Staff Created: February 20, 2012 Last Updated: February 20, 2012

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A woman poses with an extra booklet with excerpts from German dictator Adolf Hitler's book "Mein Kampf" (Stephan Jansen/AFP/Getty Images)

Recently declassified British intelligence agency files show that the Nazis attempted to destroy the confidence in Britain’s currency during World War II by issuing fake bank notes.
The National Archives published documents from MI5’s Sir Edward Reid, which suggested that the Nazis manufactured counterfeit bank notes years before the end of the war and distributed them across Europe and the British Isles in order to destabilize Britain’s economy.
The idea, the archives reveal, was to “create a loss of confidence and general confusion.” The false notes were so common, that other European countries stopped accepting them.
Adolf Hitler’s plan was to drop the fake notes on Britain as the Nazis invaded the U.K. to create mass confusion. But Britain’s Royal Air Force established air supremacy thus preventing an invasion.
By late 1945 at the end of the war, the German strategy appeared to have been successful because the neutral countries had stopped accepting the currency, according to the files.
The Nazis created fake currency worth around 134 million pounds, which amounted to around 10 percent of all its currency in circulation, according to the MI5 files.
British agents said the fake notes were a serious problem and suggested that both fake and real notes over five pounds be recalled back to England for reissuing.
“No one will accept a Bank of England note in any neutral country of Europe except at a very large discount,” wrote Reid, “and it is difficult to see how the authorities in this country can deal with the situation and restore confidence in the British currency except by calling in all the outstanding Bank of England notes of denomination of five pounds and over and making a fresh issue.”
Many of the fakes were circulated in Spain and Portugal, and later, turned up in Egypt to raise money while at the same time, damaging confidence in Britain’s currency.
The forgeries also helped reveal the misuse of diplomatic privileges. One report contained in the 74-page declassified file described how two employees at the British Embassy in Madrid, an archivist and a security guard, had “been using the diplomatic bag to send home bank notes for their own accounts.” The money had been received from “obscure sources far in excess of the salaries, which they were being paid.”
The Nazis also made a mistake. Giving fake notes to their own spies operating in the U.K., led to the capture of several German agents. “The Germans also used forged British bank notes to pay their secret agents including Snow, Rainbow, Cheese, and Pogo,” the archives said, citing Reid’s writings.
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