Pelf

When Germany swallowed Austria last year, the Bank of England played ball with the Nazis, obligingly turned over to them the gold it held in the name of the Austrian banks. Later, British owners of Austrian bonds had trouble getting their money. When last March the Germans goose-stepped into Czecho-Slovakia, the British Government quickly rushed through Parliament a bill forbidding British banks to transfer former Czech gold and credits (estimated as high as $100,000,000) to the new masters of Prague. Devised to protect British creditors, this measure pleased Britons more as a means of preventing the criminal from profiting by his crime.

Last week Britons were chagrined to learn that the Nazis had in part sidestepped this restriction, had taken over $30,000,000 of Czech gold held in London in the name of the Bank for International Settlements. The Czech National Bank had a $30,000,000 credit with the B.I.S. The "World Bank," a Swiss corporation owned and operated by the central banks of the powers and a consortium of U. S. banks, keeps no gold in its modest headquarters at Basle, instead maintains deposits with the member banks, one of them the privately operated Bank of England. Goateed Montagu Norman, Governor of the Bank of England and a director of the B.I.S., had no other course than to return the gold to the B.I.S. Presumably the Czech National Bank's management will have no course other than to do its Nazi masters' bidding, call home the gold from the B.I.S.

Parliament howled long & loud last month when it first got wind of this transaction. Chancellor of the Exchequer Sir John Simon, to silence the outcry, promised to see what could be done to squelch the deal. Sir John, reporting to Parliament last week, produced no squelcher. Banking ethics, said he, require that a customer's demand for his money be honored without question.

In getting its hands on the Czechs' $30,000,000, the Reich would receive enough gold to offset one or even two months' unfavorable trade balance.

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