Allen Dulles went to war on November 9, 1942, crossing into neutral Switzerland from Vichy France, just minutes before the Nazis closed the border. He later told the story of his border crossing with pulse-racing, dramatic flair. But, in reality, it went surprisingly smoothly, especially considering the forty-nine-year-old Wall Street lawyer’s high international profile. After presenting his passport to the French gendarme at the border station near Geneva, Dulles paced the train platform while the policeman made a phone call to Vichy authorities. Then, after a hovering Gestapo agent conveniently disappeared, the gendarme obligingly waved Dulles through. It was almost as if Dulles was expected.
There was nothing undercover about Allen Dulles’s wartime exploits in Switzerland. Afterward, he made much of his espionage adventures, with a sympathetic press and then equally credulous biographers dutifully repeating his beguiling tales. But, in truth, there was little daring involved—for a very simple reason. Dulles was more in step with many Nazi leaders than he was with President Roosevelt. Dulles not only enjoyed a professional and social familiarity with many members of the Third Reich’s elite that predated the war; he shared many of these men’s postwar goals. While serving in his Swiss outpost, Dulles might have been encircled by Nazi forces, but he was also surrounded by old friends.
After crossing the border, Dulles wasted no time in settling into Bern, the scenic Swiss capital where he had begun his espionage career a quarter century earlier as a junior member of the U.S. legation during World War I. The medieval city—built on cliffs overlooking the glacial-green Aar River, as it flowed down from the white-capped Alpine peaks on the horizon—held a treasure of memories. During the earlier war, there had been embassy parties and rounds of tennis—with balls arriving in diplomatic pouches from back home, courtesy of his brother Foster. There was an international parade of mistresses—young secretaries from the consulates that filled the city’s diplomatic quarter as well as free-spirited women from the local art colony. He met his conquests for drinks and pleasure at the Bellevue Palace Hotel, the elegant Art Nouveau fortress that dominated the Old City’s skyline. Dulles affected the look of a dashing Continental cavalry officer in those days, with a waxed mustache, slim waist jacket, and high starched collar.
One of his affairs during the First World War had a brutal ending. She was a young Czech patriot who worked alongside Dulles in the U.S. legation offices. British agents concluded that she was using her position to pass information to exiled Czech leader Jan Masaryk as well as to the Germans. When the British confronted Dulles with their suspicions, the ambitious young diplomat knew he was in an awkward spot, and he quickly complied with their plans. One night Dulles took the woman to dinner, and afterward he strolled with her along the cobblestone streets to an agreed-upon location, where he handed her over to two British agents. She disappeared forever.
When Dulles returned to Bern in 1942 for the Office of Strategic Services (OSS), America’s World War II spy agency, he set up his base of operations in his residence—the ground-floor apartment of a handsomely renovated fourteenth-century mansion at 23 Herrengasse, near the city’s majestic cathedral. Dulles later insisted that he had carefully chosen the location with security in mind, since the street ended in a cul-de-sac. He prevailed upon municipal authorities to extinguish the lamplight outside his building, giving late-night visitors a measure of anonymity as they slipped in and out. Guests seeking more confidentiality could enter Dulles’s apartment from the rear, climbing an ancient flight of stone steps that rose steeply to his back terrace from the grape arbors and dark river below.
But all this cloak and dagger was a bit of a charade. As soon as Dulles showed up in Bern, his arrival was reported in one of Switzerland’s leading newspapers, which announced him—to the spy’s great delight—as “the personal representative of President Roosevelt.” This afforded Dulles a status that would be very useful as he pursued his various intrigues.
After arriving at 23 Herrengasse with such great fanfare, Dulles found himself under intense scrutiny. Although the newly arrived American spy had enjoyed long friendships with many in the enemy camp, each side trusted the other only up to a point. From across the street, Nazi agents kept close watch on the Dulles residence twenty-four hours a day. The Germans also infiltrated his staff—his cook turned out to be a spy and his janitor stole carbon copies of his documents out of his trash. Meanwhile, Swiss intelligence agents, who worked closely with their Nazi counterparts, eavesdropped on Dulles’s phone conversations. There was little that was secret about the American spy’s life in Bern.
None of this seemed to disturb Dulles, who wandered openly through the streets of Bern in a rumpled raincoat and a fedora cocked carelessly on the back of his head. He did not have a bodyguard and he did not carry a gun. He met openly with informers and double agents in cafés and on the city streets. “Too much secrecy can be self-defeating,” he observed.
This strategy of hiding in plain sight did not make much sense from an espionage point of view. And it confounded and angered Dulles’s counterparts in the local office of MI6, the British spy agency, who dismissed the American as a rank amateur. But Dulles was involved in something far more ambitious than mere spy games. He was running his own foreign policy.
William “Wild Bill” Donovan, director of the OSS, originally wanted to station Dulles in London. But Dulles insisted on Bern and he prevailed. Donovan was a legend—a World War I combat hero and self-made Wall Street millionaire lawyer who had charmed FDR and outmaneuvered powerful rivals like J. Edgar Hoover to build the country’s first international intelligence agency. Undaunted by Washington bureaucracy, Donovan had recruited an impressively eclectic array of talent for his new spy agency—from Ivy League adventurers and society girls to safecrackers and professional killers. But Dulles, who moved in the same social circles as Donovan and competed aggressively with him on the tennis court, was not awed by his boss. He thought he could do a better job than Donovan of running the show. Dulles knew that the isolated splendor of Bern would afford him free rein to operate as he chose, with only tenuous supervision from back home.
Dulles also positioned himself in Bern because the Swiss capital was the center of wartime financial and political intrigue. Bern was an espionage bazaar, teeming with spies, double agents, informers, and peddlers of secrets. And, as Dulles knew, Switzerland was a financial haven for the Nazi war machine.
The Swiss demonstrated that they were masters of duplicity during the war. Banks in Zurich and Basel allowed the Nazis to stash the treasure they were looting from Europe in secret accounts, which Germany then used to buy the essential products from neutral countries that fueled the Third Reich—tungsten from Spain, oil from Romania, steel from Sweden, beef from Argentina. Swiss bankers promised the Allies that they would block Germany’s stolen assets, but all the while they reaped huge profits from their behind-the-scenes deals with the Nazi Reichsbank.
Dulles knew many of the central players in the secretive Swiss financial milieu because he and his brother had worked with them as clients or business partners before the war. Sullivan and Cromwell, the Dulles brothers’ Wall Street law firm, was at the center of an intricate international network of banks, investment firms, and industrial conglomerates that rebuilt Germany after World War I. Foster, the law firm’s top executive, grew skilled at structuring the complex merry-go-round of transactions that funneled massive U.S. investments into German industrial giants like the IG Farben chemical conglomerate and Krupp Steel. The profits generated by these investments then flowed to France and Britain in the form of war reparations, and then back to the United States to pay off war loans.
Foster Dulles became so deeply enmeshed in the lucrative revitalization of Germany that he found it difficult to separate his firm’s interests from those of the rising economic and military power—even after Hitler consolidated control over the country in the 1930s. Foster continued to represent German cartels like IG Farben as they were integrated into the Nazis’ growing war machine, helping the industrial giants secure access to key war materials. He donated money to America First, the campaign to keep the United States out of the gathering tempest in Europe, and helped sponsor a rally honoring Charles Lindbergh, the fair-haired aviation hero who had become enchanted by Hitler’s miraculous revival of Germany. Foster refused to shut down the Berlin office of Sullivan and Cromwell—whose attorneys were forced to sign their correspondence “Heil Hitler”—until his partners (including Allen), fearful of a public relations disaster, insisted he do so. When Foster finally gave in—at an extremely tense 1935 partners’ meeting in the firm’s lavish offices at 48 Wall Street—he broke down in tears.
Foster still could not bring himself to cut off his former Berlin law partner, Gerhardt Westrick, when he showed up in New York in August 1940 to lobby on behalf of the Third Reich. Setting himself up in an opulent Westchester County estate, Westrick invited influential New York society types for weekend parties, taking the opportunity to subject them to his pro-Hitler charm offensive. Westrick’s guest lists were dominated by oil executives because he was particularly keen on ensuring the continued flow of fuel supplies to Germany, despite the British embargo. The lobbyist finally went too far—even by the hospitable standards of the New York society set—when he had the gall to throw a gala party at the Waldorf-Astoria on June 26, 1940, to celebrate the Nazi defeat of France. Westrick’s shameless audacity created an uproar in the New York press, but Foster rushed to the Nazi promoter’s defense, insisting he had “a high regard for his integrity.”
Until late in the day, Foster harbored sympathy for the devil himself, Adolf Hitler. Even after the Nazi regime pushed through the anti-Semitic Nuremberg Laws of 1935 and unleashed waves of terror against Germany’s Jewish population, Foster clung to a sympathetic view of the Führer. He could not help being impressed by a man “who from humble beginnings . . . has attained the unquestioned leadership of a great nation,” Foster told a friend in 1937. By 1939, Eustace Seligman—a Jewish senior partner at Sullivan and Cromwell—had become so fed up with Foster’s position on Nazi Germany that he confronted his boss, telling Foster he was hurting the firm’s reputation by publicly suggesting “that Germany’s position is morally superior to that of the Allies.”
Like his brother, Allen Dulles was slow to grasp the malevolence of Hitler’s regime. Dulles met face-to-face with Hitler in the Führer’s Berlin office in March 1933. He was ostensibly on a fact-finding mission to Europe for President Roosevelt, but Dulles was particularly interested in determining what Hitler’s rise meant for his law firm’s corporate clients in Germany and the United States. As Dulles subsequently informed Foster, he did not find Hitler particularly alarming. And he was “rather impressed” with Joseph Goebbels, remarking on the Nazi propaganda chief’s “sincerity and frankness.” After Dulles and fellow U.S. statesman Norman Davis returned to the Adlon, their luxury hotel across from the Brandenburg Gate, Davis was unnerved to find the word “Juden” scrawled crudely on the door of his room, even though he was not Jewish. “The conditions are not quite as bad” as anxious reports about Hitler would indicate, Dulles nonetheless wrote Foster from Germany.
By the late 1930s, Dulles’s views finally shifted and he came to dismiss Nazi leaders as “those mad people in control in Germany.” He grew increasingly certain that the United States must prepare for an inevitable showdown with Hitler. But, out of deference to Foster, Allen was reluctant to make his opinions public. He also continued to do business with the Nazi financial and industrial network, joining the board of J. Henry Schroder Bank, the U.S. subsidiary of a London bank that Time magazine in 1939 called “an economic booster of the Rome-Berlin Axis.” And Allen and his wife, Clover, continued to socialize with the Lindberghs, who were their neighbors on Long Island’s Gold Coast shore. (Lindbergh, enamored of Hitler, noted in his diary that he and Dulles “have somewhat similar views in a number of instances.”)
Even after Dulles was recruited into the OSS by Donovan in October 1941, his loyalties were still questioned by some administration officials, including Roosevelt himself. Dulles’s various financial connections to the Nazi regime prompted FDR to place the Wall Street lawyer under close surveillance when he began working in the OSS’s thirty-sixth-floor suite in Rockefeller Center. Monitoring Dulles proved an easy task since he shared office space with a massive British spy operation run by legendary Canadian secret agent William Stephenson, who would become famous as the “Man Called Intrepid.” At one point, Stephenson’s Rockefeller Center operation—which was tucked away under the colorless name British Security Coordination—grew to as many as three thousand employees. It was a remarkably ambitious covert enterprise, particularly considering that England was operating on friendly soil.
Stephenson had been sent to the United States in 1940 by his enthusiastic patron, Winston Churchill—Britain’s newly elected prime minister—after the evacuation of British forces from the beaches of Dunkirk. With Hitler’s forces overrunning Europe and turning their gaze toward an increasingly isolated England, Churchill knew that his nation’s only hope was to maneuver the United States into the war. Roosevelt was a strong supporter of the British cause, but with as much as 80 percent of the American public against entering the European war and Congress equally opposed, both FDR and Churchill realized it would take a major propaganda offensive to sway the nation.
The British government and the Roosevelt White House faced not only a deeply wary American public with understandable concerns about the costs of war, but a well-financed appeasement lobby with strong links to Nazi Germany. With the fate of nations at stake, the shadow war in America grew increasingly ruthless. Churchill made it clear that he was quite willing to engage in what he euphemistically called “ungentlemanly warfare” to save his nation—and he enjoyed Roosevelt’s firm support.
Stephenson—Britain’s point man in the underground war against Nazi Germany on American soil—was a suave operator, with a flair for hosting lively cocktail parties at his penthouse suite in midtown Manhattan’s Dorset Hotel. But, like James Bond—the fictional spy partly modeled on Stephenson by his colleague Ian Fleming—Stephenson was also willing to do the dirty work of espionage. The slim, slight Stephenson, who arrived in New York at the age of forty-four, had the springy step of the boxer he once was—and the smooth self-assurance of the self-made millionaire he had become. He proved an adept practitioner of the black arts of espionage, working his far-flung press contacts in America to expose Nazi front companies—including some of the Dulles brothers’ corporate clients—and pressuring Washington to deport Nazi lobbyists. Stephenson’s operatives also undertook a variety of black-bag operations, such as breaking into the Spanish embassy in Washington, where they stole the secret codes for diplomatic messages flowing between General Francisco Franco’s fascist government and Berlin.
Stephenson was even authorized to kill members of the Nazi network in the United States—including German agents and pro-Hitler American businessmen—using British assassination teams. One of the men considered for elimination was none other than Dulles business partner Gerhardt Westrick. (The big-spending Hitler lobbyist was eventually simply deported.) It was this decidedly ungentlemanly Stephenson tactic that inspired Fleming to grant his hero “the license to kill.”
Fleming was a great admirer of Stephenson, whom he called “a magnetic personality” and “one of the great secret agents” of World War II. The novelist, who worked with Stephenson’s operation as a British naval intelligence agent in Washington, also praised the spymaster’s martinis—which he served in quart glasses—as “the most powerful in America.” But as Fleming himself observed, even his fictional hero James Bond was “not in fact a hero—but an efficient and not very attractive blunt instrument in the hands of government.”
Years later, when James Jesus Angleton and William K. Harvey—two legends of U.S. counterintelligence—were searching for assassins to kill Cuban leader Fidel Castro, they sought advice from a British colleague named Peter Wright. “Have you thought of approaching Stephenson?” Wright suggested. “A lot of the old-timers say he ran this kind of thing in New York during the war.”
President Roosevelt was well aware that the Dulleses were at the center of Wall Street and Republican Party opposition to his presidency. The brothers, as top legal advisers to America’s business royalty, were the very symbols of the “plutocracy” that the president railed against when giving vent to his populist passions. The fact that they were also linked to Nazi financial interests only deepened Roosevelt’s suspicions.
While FDR himself was adept at hiding his true political feelings behind a mask of charm, there were some New Deal loyalists who openly expressed the deep enmity between the Roosevelt and Dulles camps. One such firebrand was William O. Douglas, the progressive young lawyer President Roosevelt put in charge of the Securities and Exchange Commission, the newly formed Wall Street watchdog agency, and later appointed a justice of the Supreme Court. As FDR’s top Wall Street regulator, Douglas had more than one occasion to cross swords with Foster. Years later, Douglas’s hatred for the “unctuous and self-righteous” senior Dulles brother still reverberated in the New Dealer’s memoir. Foster carried himself like a “high churchman,” observed Douglas. But in reality, he was the kind of “predatory” Wall Street shill “who for a fee would stand for almost anything.” If the John Foster Dulleses of America were destined for heaven—as men of his ilk were always utterly certain—then Douglas would rather end up in hell. “I could perhaps endure [men like Foster] for an evening. But to sit on a cloud with [them] through eternity would be to exact too great a price.”
Though FDR shared the Dulles crowd’s privileged background, the president felt much more in tune with men like Douglas, the product of a hardscrabble childhood in Washington’s Yakima Valley, where he had grown up picking fruit to help support his family. Brilliant and hard-driven, Douglas worked his way through Columbia University Law School. One of the talented law school graduate’s first job interviews was with Foster Dulles at Sullivan and Cromwell. But Foster was so “pontifical” that Douglas decided against joining the firm. “In fact,” he recalled, “I was so struck by [Foster’s] pomposity that when he helped me on with my coat, as I was leaving his office, I turned and gave him a quarter tip.”
After joining the Roosevelt administration at the age of thirty-five, Douglas quickly developed a reputation as a rising New Deal star, taking over as chairman of the Securities and Exchange Commission from Joseph P. Kennedy in 1937 and becoming a fixture in the president’s inner circle. A frequent weekend guest at Camp David, the presidential retreat that was widely known in those years as Shangri-la, Douglas solidified his position with the president by learning to perfect a dry martini, FDR’s favorite cocktail.
Roosevelt grew so fond of Douglas that in 1944, while pondering running mates for his fourth presidential run, he briefly considered his young SEC chairman. Douglas was an energetic New Dealer, FDR reminded a group of Democratic Party bosses who had gathered in the White House to advise him on the decision. Besides, he noted, Douglas played a stimulating game of poker. But the political bosses were not as enamored of Douglas as the president. They were well aware that announcing a Roosevelt-Douglas ticket would set off a bombshell on Wall Street.
While serving with the SEC, Douglas had become a scourge of the financial industry. Bankers and lawyers accustomed to the hushed privacy of wood-paneled suites and private dining rooms were yanked before public hearings presided over by Douglas and his sharp young staff and forced to account for their business practices. Even Robert Swaine of the white-shoe law firm Cravath—who had once been Douglas’s boss—got the full treatment. “You stood me on my head and shook all the fillings out of my teeth,” he later told Douglas.
With his craggy Western good looks and lean, outdoorsman’s build, Douglas seemed cut out to be a populist hero—an everyman Gary Cooper taking on pompous big shots like the ones played by Edward Arnold in Frank Capra movies. And stuffed-shirt John Foster Dulles was his perfect nemesis. Douglas once put Foster on the witness stand for two full days, grilling him about the fortune that he had reaped for his law firm by managing a sketchy bankruptcy procedure that had fleeced a multitude of creditors. The high and mighty Foster had squirmed on the stand like a pontiff forced “to do business with the underworld,” recalled Douglas.
By siccing men like William O. Douglas on men like John Foster Dulles, President Roosevelt drove the plutocracy mad. J. P. Morgan Jr. was so incensed by the “class traitor” FDR that his servants had to cut out the president’s picture from the Wall Street titan’s morning newspaper for fear that it would spike his blood pressure. The class hatred against Roosevelt even resulted in at least two abortive coups against his presidency. In 1934, a group of Wall Street plotters—financed by wealthy Roosevelt enemies (and Dulles clients) like the Du Ponts—tried to recruit Marine war hero General Smedley Butler to lead an armed march on Washington. In 1940, newspaperman and socialite Cornelius Vanderbilt Jr.—one of FDR’s few friends in the New York club set—tipped off Eleanor Roosevelt to another anti-Roosevelt plot he had heard being hatched in his Fifth Avenue circles, involving tycoons as well as army officers.
The First Lady was among those who wondered about the wisdom of allowing someone like Allen Dulles to set up spy operations in war-torn Europe, where he was certain to open lines of communication to Nazi interests. But Dulles was not the only master chess player involved in this high-stakes game. FDR apparently had his own reason for allowing Dulles to establish himself in Bern. “He was a dangle,” said John Loftus, a former Nazi war crimes investigator for the U.S. Justice Department. “The White House wanted Dulles in clear contact with his Nazi clients so they could be easily identified.”
One of Dulles’s most important contacts in Europe was Thomas McKittrick, an old Wall Street friend who was president of the Bank for International Settlements. BIS had been created by the world’s leading central banks to administer German reparations payments after World War I, but it soon took on a life of its own, transforming itself into a pillar of the emerging global financial system. Lodged in a former hotel next to a chocolate shop in Basel, Switzerland, BIS was so secretive that nobody was permitted to peer inside its boardroom, even when it was empty. By 1940, when McKittrick arrived in Switzerland to oversee the bank, it was effectively controlled by Hitler’s regime. Five of its directors would later be charged with war crimes, including Hermann Schmitz, the CEO of IG Farben, the chemical conglomerate that became notorious for its production of Zyklon B, the gas used in Hitler’s death camps, and for its extensive use of slave labor during the war.
Schmitz was one of the many Dulles brothers’ law clients and business associates who were involved with BIS. It was a close-knit circle of men whose relationships smoothly weathered the storms of war. Even as his company was stockpiling poison for Hitler’s exterminators, Schmitz would send cheery Christmas and birthday greetings to his American business friends.
The secretive BIS became a crucial financial partner for the Nazis. Emil Puhl—vice president of Hitler’s Reichsbank and a close associate of McKittrick—once called BIS the Reichsbank’s only “foreign branch.” BIS laundered hundreds of millions of dollars in Nazi gold looted from the treasuries of occupied countries. Some of the gold was torn from the mouths of concentration camp victims or melted down from Jewish families’ candleholders, cigarette cases, and other personal belongings.
Dulles connected with McKittrick as soon as he set foot in Europe, meeting with the BIS president in Lisbon, even before he reached Switzerland. McKittrick, a well-tailored, pink-cheeked man with a high-domed forehead and prematurely snowy hair, later described the meeting as a happy coincidence. But both men were clearly eager to talk business. As soon as he walked into the lobby of his Lisbon hotel, the banker recalled, “Somebody grabbed me from behind and said, ‘Is that you Tom McKittrick? Well, my gosh, I’ve got to see you. You’re the first man I wanted to see in Switzerland.’ And it was Allen Dulles, on his way over [to his OSS station in Bern].” The two men stayed up all night at the hotel, in deep conversation, until McKittrick had to leave for his five o’clock plane.
Dulles was eager to pump McKittrick for inside information about the Reich, since the banker had good connections in Berlin. But the two men also wanted to discuss another issue that was of paramount concern to both of them: how to protect the assets of their German and American corporate clients in the tumultuous war climate.
Like Dulles, McKittrick was not popular with Roosevelt and his inner circle. FDR’s Treasury secretary, Henry Morgenthau Jr., developed a deep loathing for McKittrick, whom Morgenthau’s aide, Harry Dexter White, called “an American [bank] president doing business with the Germans while our American boys are fighting the Germans.” The Roosevelt administration moved to block BIS funds in the United States, but McKittrick hired Foster Dulles as legal counsel, who successfully intervened on the bank’s behalf.
Morgenthau was outraged when McKittrick made a business trip to the United States in winter 1942 and was warmly feted by Wall Street. Dozens of powerful financiers and industrialists—including the executives of several corporations, such as General Motors and Standard Oil, that had profited handsomely from doing business with the Nazis—gathered for a banquet in McKittrick’s honor at New York’s University Club on December 17.
Morgenthau tried to prevent McKittrick from returning to BIS headquarters in Switzerland on the grounds that the bank was clearly aiding the Nazi war effort. The banker later sniffed about the “nasty crew in the Treasury at the time. . . . I was very suspect because I talked to Italians and talked to Germans—and I said that they had behaved very well. I [refused to denounce them as] villains of the worst sort.” Allen Dulles came to McKittrick’s rescue, deftly pulling strings on the banker’s behalf, and in April 1943 he finally boarded a transatlantic flight to Europe.
Dulles and McKittrick continued to work closely together for the rest of the war. In the final months of the conflict, the two men collaborated against a Roosevelt operation called Project Safehaven that sought to track down and confiscate Nazi assets that were stashed in neutral countries. Administration officials feared that, by hiding their ill-gotten wealth, members of the German elite planned to bide their time after the war and would then try to regain power. Morgenthau’s Treasury Department team, which spearheaded Project Safehaven, reached out to the OSS and BIS for assistance. But Dulles and McKittrick were more inclined to protect their clients’ interests. Moreover, like many in the upper echelons of U.S. finance and national security, Dulles believed that a good number of these powerful German figures should be returned to postwar power, to ensure that Germany would be a strong bulwark against the Soviet Union. And during the Cold War, he would be more intent on using Nazi loot to finance covert anti-Soviet operations than on returning it to the families of Hitler’s victims.
Dulles realized that none of his arguments against Project Safehaven would be well received by Morgenthau. So he resorted to time-honored methods of bureaucratic stalling and sabotage to help sink the operation, explaining in a December 1944 memo to his OSS superiors that his Bern office lacked “adequate personnel to do [an] effective job in this field and meet other demands.”
McKittrick demonstrated equal disdain for the project, and his lack of cooperation proved particularly damaging to the operation, since BIS was the main conduit for the passage of Nazi gold. “The Treasury [Department] kept sending sleuth hounds over to Switzerland,” he complained years later. “The only thing they were interested in was where was Hitler putting his money, and where [Hermann] Goering was putting his money, and [Heinrich] Himmler, and all the rest of the big boys in Germany. But I, myself, am convinced that those fellows were not piling up money for the future.”
While Allen Dulles was using his OSS post in Switzerland to protect the interests of Sullivan and Cromwell’s German clients, his brother Foster was doing the same in New York. By playing an intricate corporate shell game, Foster was able to hide the U.S. assets of major German cartels like IG Farben and Merck KGaA, the chemical and pharmaceutical giant, and protect these subsidiaries from being confiscated by the federal government as alien property. Some of Foster’s legal origami allowed the Nazi regime to create bottlenecks in the production of essential war materials—such as diesel-fuel injection motors that the U.S. military needed for trucks, submarines, and airplanes. By the end of the war, many of Foster’s clients were under investigation by the Justice Department’s antitrust division. And Foster himself was under scrutiny for collaboration with the enemy.
But Foster’s brother was guarding his back. From his frontline position in Europe, Allen was well placed to destroy incriminating evidence and to block any investigations that threatened the two brothers and their law firm. “Shredding of captured Nazi records was the favorite tactic of Dulles and his [associates] who stayed behind to help run the occupation of postwar Germany,” observed Nazi hunter John Loftus, who pored through numerous war documents related to the Dulles brothers when he served as a U.S. prosecutor in the Justice Department under President Jimmy Carter.
If their powerful enemy in the White House had survived the war, the Dulles brothers would likely have faced serious criminal charges for their wartime activities. Supreme Court Justice Arthur Goldberg, who as a young lawyer served with Allen in the OSS, later declared that both Dulleses were guilty of treason.
But with Franklin Roosevelt gone from the arena, as of April 1945, there was not enough political will to challenge two such imposing pillars of the American establishment. Allen was acutely aware that knowledge was power, and he would use his control of the country’s rapidly expanding postwar intelligence apparatus to carefully manage the flow of information about him and his brother.
FDR announced the Allied doctrine of “unconditional surrender” at the Casablanca Conference with British prime minister Winston Churchill in January 1943. The alliance’s third major leader, Soviet premier Joseph Stalin, was unable to attend the conference because he was still contending with the horrific Nazi siege of Stalingrad. The Red Army would finally prevail at the Battle of Stalingrad, and the epic victory shifted the war’s momentum against the Third Reich. But the costs were monumental. The Soviet Union lost over one million soldiers during the struggle for Stalingrad—more than the United States would lose during the entire war.
The Casablanca Conference, held January 12–23, 1943, at a barbed wire–encircled hotel in Morocco, would sorely aggrieve the missing Russian leader by concluding that it was too soon to open a second major front in France. But Roosevelt’s unconditional surrender declaration, which took Churchill by surprise, was FDR’s way of reassuring Stalin that the Americans and British would not sell out the Soviet Union by cutting a separate peace deal with Nazi leaders.
The Casablanca Conference was a major turning point in the war, sealing the fate of Hitler and his inner circle. As Roosevelt told the American people in a radio address following the conference, by taking an uncompromising stand against the Third Reich, the Allies made clear that they would not allow Hitler’s regime to divide the antifascist alliance or to escape justice for its monumental crimes. “In our uncompromising policy,” said Roosevelt, “we mean no harm to the common people of the Axis nations. But we do mean to impose punishment and retribution in full upon their guilty, barbaric leaders.”
With his close ties to Germany’s upper echelons, Dulles considered the unconditional surrender declaration a “disaster” and was quick to let his Nazi contacts know what he thought about it. Shortly after the Casablanca Conference, Dulles sat down one wintry evening with an agent of SS leader Heinrich Himmler, an oily Mittel-European aristocrat who had flitted in and out of Dulles’s social circle for many years. Dulles received his guest, who was known as “the Nazi prince,” at 23 Herrengasse, treating him to good Scotch in a drawing room warmed by a fire. The Casablanca Declaration had clearly unnerved Himmler’s circle by making it clear that there would be no escape for the Reich’s “barbaric leaders.” But Dulles took pains to put his guest’s mind at rest. The Allies’ declaration, Dulles assured him, was “merely a piece of paper to be scrapped without further ado if Germany would sue for peace.”
Thus began Allen Dulles’s reign of treason as America’s top spy in Nazi-occupied Europe.
Maximilian Egon von Hohenlohe, the Nazi prince, was a creature of Europe’s war-ravaged landed aristocracy. Prince Max and his wife, a Basque marquesa, had once presided over an empire of properties stretching from Bohemia to Mexico. But two world wars and global economic collapse had stripped Hohenlohe of his holdings and reduced him to playing the role of Nazi courier. The prince had first met Dulles in Vienna in 1916, when they were both young men trying to make a name for themselves in diplomatic circles. During the 1930s, after he fell into the less refined company of the SS thugs who had taken over Germany, Hohenlohe popped up as an occasional guest of Allen and Clover in New York.
Hohenlohe was just one more member of the titled set who saw advantages to Hitler’s rise, and was quite willing to overlook its unpleasant side, which the prince explained away as rank-and-file Nazi Party excesses that would inevitably be sorted out. The Hohenlohe family was filled with ardent Nazi admirers. Perhaps the most bizarre was Stephanie von Hohenlohe, who became known as “Hitler’s princess.” A Jew by birth, Stephanie found social position by marrying another Hohenlohe prince. In the years before the war, she became one of Hitler’s most tireless promoters, helping to bring British press magnate Lord Rothermere into the Nazi fold. Stephanie took Hitler’s handsome, square-jawed adjutant Fritz Wiedemann as a lover and laid big plans for their rise to the top of the Nazi hierarchy. But it was not to be. Jealous of her favored position with Hitler, SS rivals plotted against her, spreading stories about her Jewish origins. Her aunt died in a concentration camp, and Stephanie was forced to flee Germany.
But Prince Max suffered no such fall from grace. He roamed Europe, feeling out British and American diplomats on a possible deal that would sacrifice Hitler but salvage the Reich. Wherever he went, Hohenlohe got a brusque reception. British foreign secretary Anthony Eden warned against even speaking with the prince: “If news of such a meeting became public . . . the damage would far exceed the value of anything the prince could possibly say.” American diplomats in Madrid, who were also approached by Hohenlohe, dismissed him as a “flagrant” liar and a “totally unscrupulous” schemer whose overriding concern was “to protect his considerable fortune.”
Dulles brushed aside these concerns; he had no compunctions about meeting with his old friend. The truth is, he felt perfectly at ease in the company of such people. Before the war, Dulles had been an occasional guest of Lord and Lady Astor at Cliveden, the posh couple’s country home along the Thames that became notorious as a weekend retreat for the pro-Nazi aristocracy. (There is no getting around this unwelcome fact: Hitler was much more fashionable in the social settings that men like Dulles frequented—in England as well as the United States—than it was later comfortable to admit.)
Royall Tyler, the go-between who set up the Bern reunion between Dulles and Hohenlohe, was cut from similar cloth. Born into Boston wealth, Tyler traipsed around Europe for most of his life, collecting Byzantine art, marrying a Florentine contessa, and playing the market. The multilingual Tyler and his titled wife led a richly cultured life, with Tyler haunting antique shops and private collections in search of Byzantine treasures and restoring a château in Burgundy where he showed off his rare books and art. “Traveling with Tyler,” noted London OSS chief David Bruce, “is like taking a witty, urbane, human Baedeker as a courier.” The contessa, who was equally sophisticated, moved in artistic and literary circles. She was at the bedside of Edith Wharton in 1937 when the novelist expired at her villa outside Paris.
Tyler was another one of those refined men who glided smoothly across borders and did not think twice about doing business with Nazi luminaries. During the war, he moved to Geneva to dabble in banking for the Bank for International Settlements. Tyler’s virulent anti-Semitism made him a congenial colleague when the Reich had business to conduct in Switzerland. Well connected in the enemy camp, Tyler was among the first people whom Dulles sought out after arriving in Switzerland.
Now Dulles and Hohenlohe, and their mutual friend Royall Tyler, were gathered amiably around the OSS man’s fireplace at 23 Herrengasse. Dulles broke the ice by recalling old times with Prince Max in Vienna and New York. Then the men quickly got down to business—trying to determine whether a realpolitik deal could be struck between Germany and the United States that would take Hitler out of the equation but leave the Reich largely intact. As they spun out their visions for a postwar Europe, there was much common ground. Dulles and Hohenlohe clearly saw the Soviet Union as the enemy, with a strong Germany as a bastion against the Bolshevik and Slavic menace. The two old friends also agreed that there was probably no room for the Jewish people in postwar Europe, and certainly they should not return to positions of power. Dulles offered that there were some in America who felt the Jews should be resettled in Africa—an old dream of Hitler’s: the Führer had once fantasized about sending the pariah population to Madagascar.
The two men were too worldly to engage in any emotional discussion about the Holocaust. Dulles put the prince at ease by telling him that he “was fed up with hearing from all the outdated politicians, emigrants and prejudiced Jews.” He firmly believed that “a peace had to be made in Europe in which all of the parties would be interested—we cannot allow it to be a peace based on a policy of winners and losers.”
Instead of Roosevelt’s “unconditional surrender,” in which the Nazi leadership would be held accountable for their crimes against humanity, Dulles was proposing a kind of no-fault surrender. It was a stunningly cynical and insubordinate gambit. The pact that Dulles envisioned not only dismissed the genocide against the Jews as an irrelevant issue, it also rejected the president’s firmly stated policy against secret deal making with the enemy. The man in the White House, clinging to his anti-Nazi principles, was clearly one of those “outdated politicians” in Dulles’s mind. While boldly undermining his president, Dulles had the nerve to assure Hohenlohe that he had FDR’s “complete support.”
The fireplace meeting was, in fact, a double betrayal—Dulles’s of President Roosevelt, and the Nazi prince’s of Adolf Hitler. Hovering over the tête-à-tête at 23 Herrengasse was the presence of Heinrich Himmler. He was the Reich’s second most powerful man, and he dared to think he could become number one. With his weak chin, caterpillar mustache, and beady eyes gazing out from behind wire-rim glasses, Himmler looked less an icon of the master race than an officious bank clerk. The former chicken farmer and fertilizer salesman inflated himself by claiming noble heritage and was given to explorations of the occult and other flights of fantasy. But Himmler was a steely opportunist and he ruthlessly outmaneuvered his rivals, rising to become Hitler’s indispensable deputy and the top security chief for the Nazi empire.
It was Himmler whom the Führer had entrusted with the Final Solution, their breathtaking plan to wipe the Jewish people from the face of the earth. It was Himmler who had the nerve to justify this plan, standing before his SS generals in October 1943 and assuring them that they had “the moral right to destroy this people which wanted to destroy us,” to pile up their “corpses side by side” in monuments to the Reich’s power. As Hannah Arendt later observed, Himmler was the Nazi leader most gifted at solving the “problems of conscience” that sometimes nagged the Reich’s executioners. With his “winged words,” as his diligent administrator of death, Adolf Eichmann, put it, Himmler transformed his men’s gruesome work into a grand and secret mission that only the SS elite were capable of fulfilling. “The order to solve the Jewish question, this was the most frightening an organization could ever receive,” Himmler told the leaders of his killing teams. He knew how to appeal to his men’s sense of valor and vanity, telling them, “To have stuck it out and, apart from exceptions caused by human weakness, to have remained decent, that is what has made us hard. This is a page of glory in our history which has never been written and is never to be written.”
And, in the end, it was Himmler who—despite his long enchantment with the Hitler cult—had the brass to consider replacing his Führer when he realized that the war could not be won militarily. Prince Max was only one of the emissaries Himmler dispatched across Europe to seek a separate peace deal with the United States and England. At one point, Himmler even recruited fashion designer Coco Chanel, bringing her to Berlin to discuss strategy.
Himmler knew he was playing a very dangerous game, letting Hitler know just enough about his various peace feelers, but not enough to arouse suspicion. Dulles, too, understood that he was playing with fire by defying presidential orders. After receiving a warning from Washington about the perils of fraternizing with Hohenlohe, Dulles sent back a cagey reply, cabling that he realized the prince was a “tough customer and extreme caution required,” but he might prove “useful.” Dulles did not find it necessary to inform his superiors just how deeply involved he was with Himmler’s envoy.
Dulles and Tyler met with Hohenlohe on several other occasions over the next few weeks, from February into April. And even as late as November 1943, Dulles continued to forward to Washington Prince Max’s reports on Himmler’s frame of mind. Dulles regarded the prince as a serious enough collaborator to give him a secret OSS code number, 515.
In the end, Dulles’s machinations with Hohenlohe went nowhere. President Roosevelt was very much in control of the U.S. government, and his uncompromising position on Nazi capitulation was still firmly in place. When OSS chief Wild Bill Donovan informed the president about the Himmler peace initiatives, FDR made it clear that he remained adamantly opposed to cutting any deals with the Nazi high command. As long as that was presidential policy, there was nothing Dulles could do but bide his time and maintain his secret lines to the enemy.
Despite Heinrich Himmler’s elusive quest to cut a deal with the Allies, he never lost faith in Dulles. On May 10, 1945, just days after the war ended, Himmler set out from northern Germany with an entourage of SS faithful, heading south toward Switzerland—and the protection of the American agent. He was disguised in a threadbare blue raincoat and wore a patch over one eye, with his trademark wire-rims stashed in his pocket. But Himmler never made it to his rendezvous with Dulles. The SS chief and his retinue were captured by British soldiers as they prepared to cross the Oste River. While in custody, Himmler cheated the hangman by biting down on a glass capsule of cyanide.
Even if Himmler had made it to Switzerland, however, he would not have found sanctuary. He was too prominent a face of Nazi horror for even Dulles to salvage. But the American spy would come to the rescue of many other Nazi outlaws from justice.