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October
22
2019

French Gold in World War Two
Larry LaBorde

This story is about one of the world’s largest gold hoards stored in one of the largest most secure vaults ever built. The French stored their 2,500 tons of gold in their secure underground vault in Paris. When the Germans began their offensive, the French started to remove its gold as a precaution. When the Maginot Line was breached and it was clear Paris would be overrun the remaining gold was rushed out of France. The gold traveled over thousands of miles in different directions by ship, train, truck, and airplane during WWII. So grab your Indiana Jones fedora and a globe so you can follow along.

The Banque de France worked for over 3 years to construct its famous gold vault, La Souterraine. In 1927 it was completed after hard work by over 1,000 construction workers. The vault is one of the largest of its kind in the world. It is still in use today and is one of four IMF depositories. It is located near the Louvre under Hotel Toulouse. At 100 feet below ground level and over 100,000 square feet in size it is most impressive.

For bullion to enter the vault it must first go down the primary elevator to basement level 4. Then proceed down the hall to a 7-ton armoured door. Once through, there is a second 17-ton steel block that moves on rails via a 35-ton rotating turret. Then down a secondary elevator to basement level 8. It must then get past a second steel block on rails followed by more security doors and finally placed into locked steel cabinets. The vault holds the French gold reserves as well as gold from several other countries.

Just prior to WWII the Banque de France held 2,500 metric tons or 80,375,000 troy oz of gold. Most of the gold reserves were in La Souterraine with a minor amount in other branch locations. In 1938, at the Munich Conference, the UK, France, and Italy agreed to allow Germany to annex the Sudeten German territory inside of Czechoslovakia hoping to appease Hitler. France was worried and decided to send 600 tons of gold to the United States for storage in case they needed to quickly purchase and pay for additional arms.

The next year, in 1939, Belgium and Poland moved the last of their gold reserves, totaling 198 tons, to France. Belgium had previously moved about a third of their reserves to London and another third of their reserves to the US. In the fall of 1939 Hitler invaded Poland and Belgium. France’s minister of finance, Lucien Lamoureux, immediately began to empty La Souterraine ignoring many in government who wanted to keep the gold in the vault. It took 35 convoys, a total of 300 trucks but in one month the vault was emptied and the gold was moved to Banque de France branch bank vaults near the Western port of Brest, in Brittany, the Southwestern port of Le Verdon, on the Atlantic just north of Bordeaux, and the Mediterranean port of Marseille in the south. Over the next six months the French navy transported 400 tons of gold in four convoys to the United States. They used their smaller fast cruisers to do the job instead of their larger more formidable, but slower, naval ships.

By May of 1940 the Germans were on the march towards France. An aircraft carrier left the port of Toulon near Marseille with 195 tons of gold and sailed to the Azores. Two fast cruisers with 210 tons of gold from the port of Brest met up with the carrier in the Azores. All three ships sailed together to Halifax Canada. The fastest naval cruiser in the world at the time, the Emile Bertin, sailed back from Halifax to Brest all alone.

On May 28, 1940, a civilian ship sailed for Casablanca with 212 tons of gold. In Casablanca the gold was transferred to the USS Vincennes that brought it to New York. The United States insisted all the French gold be exchanged for US dollars upon arrival at the Federal Reserve. After June 5, 1940, the Banque de France decided not to send any more gold to the United States.

On June 11, 1940 the French cruiser, Emile Bertin, sailed across the Atlantic from the port of Brest back to Halifax with an amazing cargo of 255 tons of gold on a single ship. By the time the ship reached Canada on June 18th, 1940, France had already capitulated to Germany and was considered an enemy of Great Britain. The ship was quickly ordered by the Banque de France to go to Martinique in the Caribbean. It was a good thing the Emile Bertin was so fast as they were pursued by three UK ships now seeking to capture the French gold. The Emile Bertin outran the UK ships and safely arrived at Fort-de-France in Martinique on June 24, 1940.

On June 17th , 1940, Marshall Petain announced the capitulation of France. The French government signed the surrender papers of June 22nd , 1940 and they went into effect three days later.

Meanwhile in Brittany the Banque de France employees were moving the last of the 750 tons of gold onto four ships. It was utter chaos moving in the middle of a general evacuation where everyone wanted to leave at once in front of the quickly advancing German army. Trucks, men to load and drive them and ships to load onto were at a premium - if they could be found at all. Out of desperation the Banque de France employees found and repaired eleven 5-ton trucks that the British army had abandoned. They were able to load the ships just hours in front of the advancing German Army. Even though Marshall Petain capitulated on June 17th Admiral Darlan did not order the navy evacuation of the gold to stop. On the evening of June 18th the ships left the harbor just before dark and threaded their way through the harbor minefield with the sun setting in front of them and the Germans advancing right behind them.

The fleet of four ships carrying the last of the Banque de France’s gold met up with another ship from the port of Lorient just to the South. This ship had been loaded with the Polish and Belgian gold. The little fleet that just barely escaped sailed to Dakar, Africa with the largest shipment of gold, 1,100 tons, in modern history. The gold was promptly unloaded and sent inland 35 miles via train (on the Dakar – Niger railroad) to the French fort at Thies.

Dakar is located in present day Senegal. At the time it was a colony of France and known as French West Africa. Dakar is the chief Atlantic seaport in that part of Africa located at the mouth of the Senegal River, as such it contained a major French naval base. After the armistice with Germany went into effect on June 25th, 1940, French West Africa was subject to the Vichy French government led by President Petain but under the ultimate authority of the Germans. In September of 1940 just a couple of months after the gold arrived, General de Gaulle’s Free French fighters tried to invade and take the seaport of Dakar but was repulsed by the Vichy French forces. The Banque de France employees decided the gold was at risk that close to Dakar. They decided to move it 560 miles further inland via train to the city of Kayes in French Sudan (present day Mali). The gold had made the trip safely so far but now there was trouble brewing with the Vichy French government.

The National Bank of Belgium was in exile in the UK was upset about their gold reserves ending up in Africa. The National Bank of Belgium had directed the Banque de France to ship their gold to the United States. At the last moment, because of all the confusion from the rapidly advancing German army, the Belgium gold was taken along with the French gold to Dakar. The German government declared that the Belgium gold did not belong to the Banque de France and the Vichy French government reluctantly agreed with them. The Germans wanted the Belgium gold deposited in the German Reichsbank and held there in an account for the National Bank of Belgium. The Vichy government struck a deal to move the Belgium gold to Berlin with the understanding that the Germans would release all of the French prisoners of war. The Banque de France very reluctantly agreed to execute the deal. However, since they were in the middle of Vichy French territory, they had little choice to do otherwise. Too much opposition and the Germans might demand the Banque de France gold as well.

The Belgium gold was sent very slowly to Berlin along 3 different routes over the next 18 months. Multiple routes were used to transport the gold from the city of Kayes in French Sudan.

• One route was via airplanes to Casablanca, airplanes to Marseille and then by train to Berlin.

• The second route was by train back to Dakar, by ship to Casablanca, by train to Algiers, by air to Marseille and then by train to Berlin.

• The final route was further inland via boat to Koulikoro on the Niger River in French Sudan, then further upriver past Timbuktu to Bourem in French Sudan (Mali), then off-loaded onto trucks for the long drive north overland across the desert to the rail terminus at Bechar, Algeria, by train to Algiers, by airplanes to Marseille and finally by train to Berlin.

On May of 1942 all the Belgium gold was finally in the vaults of the Reichsbank. It had taken almost two years. That same month Marshall Goring seized the gold. In an effort to disguise the gold’s origins Goring sent it to the Prussian Staatsmunze (Prussian state mint) to have it melted down and recast into German bars and back dated 1936 and 1937. A portion of the gold was sent to Switzerland to pay Spain, Portugal and Sweden for German war materials. The bulk of the gold was still in the Reichsbank’s vaults, in Berlin, as the Allied troops advanced into Germany. It was transferred, along with the rest of the Reichsbank’s gold, to the mine at Merkers where General Patton’s troops founds it, along with artwork and other stolen treasures from around Europe. The Germans even transferred the documents showing where the Belgium gold was melted and illegally re-stamped with the earlier dates by the Prussian mint.

The Bank of Belgium sued the Banque de France for its gold that was lost to the Germans in Africa. The Belgiums sued in United States courts and wanted immediate reparations from the portion of the French gold reserves that were stored in the United States. The United States courts withheld ruling due to lack of French witnesses available at the time. After the war the Banque de France returned all 198 tons to the National Bank of Belgium from its own reserves. Susequently the lawsuit in the US courts was dropped. The gold that General Patton found was turned over to the Tripartite Commission. The TPC was responsible for restitution of the gold between the countries of Europe that had been victims of German theft. In the end the Banque de France was reimbursed 120 tons of the 198 tons of Belgium gold stolen by the Germans by the TPC. With all the thousands of miles traveled by truck, train, ship & airplane in the middle of a war the Banque de France employees lost less than 0.02% of all the gold in their charge.

The Marshall Plan, named after Secretary of State General George C. Marshall, helped to rebuild Western Europe with US funds. However, those funds did not show up until two years after the war in Europe was over. The gold reserves of the Banque de France immediately after the war helped France recover and begin to rebuild their economy.

After a war, depression or financial crisis there is nothing like gold to start investing in the economy to rebuilding wealth. No one knows what the future will bring but in the meantime start your own central bank and buy a few more ounces of gold for your family treasury.

Larry’s interest in precious metals originated at age eight, when he made his first trade after learning that the new 1965 coins were made with far lower silver content than earlier coins. He promptly exchanged new coins for older, more valuable coins that he gathered from the tellers at the bank where his dad was a board member and from the lunch ladies at school. He was thrilled at having spotted such a rich opportunity because of a stupid move by the government, and his fate as a metals broker was sealed.

In high school, recruiters from MIT and the Naval Academy came calling, but Larry had already made the decision to marry his sweetheart and follow in his father’s footsteps in the water well drilling business, so he went to Louisiana Tech University and trained as a civil engineer. After college, he returned to Shreveport and took over operations of the family business. He is active, along with his four brothers, in both the water well drilling business started by his father and a water well supply business.

Larry enjoys traveling with his wife of 35 years and racing dinghy-sized sailboats. He is active in the Shreveport Lions Club and the McNeill Street Pump Station preservation effort. An avid student of monetary history and U.S. history and politics, he is the author of Libertorn: Hope and Heartache for America’s Future (in press).

Larry and his wife, the lovely Miss Puddy, have two grown children and live in Shreveport, Louisiana (USA) with Gracie, a border collie who likes to bark at the second hand of the wall clock, and Abbie, a golden retriever who looks sweet and innocent in between stealing treats. When not traveling, studying or playing with the dogs, Larry occasionally goes on mini-adventures with Miss Puddy to do things like jump out of a perfectly good airplane.

Larry LaBorde owns Silver Trading Company, LLC (www.silvertrading.net) and has sold gold, silver, platinum and palladium around the world since 2001. Larry travels the world meeting with customers, investors and interesting people from almost everywhere. Contact him about buy, selling or storing precious metals at [email protected].

Larry is not a financial advisor and any information expressed here is strictly the opinion of a man starting to get grey hair.

PS: You can take a virtual tour of La Souterraine with the following link https://www.youtube.com/watch?v=vp6G-0gt7Os.

 

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