New-York tribune., 1918-02-26
German Plot to Buy Wool
Crop of World Foiled

Bank, as nominal purchaser. McClem
ent was unable to obtain an import
license. and it became necessary to
have an American firm serve as nomi-
nal purchaser. For this purpose
Schmidt and Schwerdt appear to have
used the names of Botany Worsted
Mills and Forstmann & HUFFMAN. two
wool manufacturing firms of Passaic
n. j.
The association here called the
textile Alliance has, since 1915, as
sumed the licensing of wool dealings,
all shipments of wool from the Cape
Of Good Hope being consigned to it.
hesc transactions are being studied
by the Textile Alliance with view to
revoklng the import licenses' of certain
individuals and firms, if the circum-
stances warrant.
There can be no question that
Schwerdt has considered himself q
German, that his sympathics are pro-
German, that he has been engaged in
the wool trade on behalf of German
interests and masquerading under
American names and that at the pres
ent tine he is cndeavoring to dissimu-
late his real sentiments and those Of
his SON"
Wrote TO Government Agent
"ln general, Schwcrdt was not, so
lar as appears. German government
agent, but was acting on behalf of Ger
man manufacturers, clients of the
Deutsche Bank Nevertheless. the
papers show correspondence passing
between Schwerdt and Privy Councillor
H. f. Albert, who was an agent of the
German government. The most i'm
portant of these appears to have been
general m 10
consisting of elght pages, addressed by
Schwerdt to II. i. Albert, January 10,
1917, a copy of which was sent to Hugo
Schmidt. and is in his tiles"
This report, in German, is one of the
important documents in the hands of
the Attorney General. In it Schwerdt
tells Of the difficulty of getting wool
because of the British embargo, and
suggests the plan OF buying up the
raw product through American firms
and storing it here and in South Amer
lca. Figures showing the total product
OF the various wool producing British
colonies are cited. Schwerdt empha-
sizes the desirability of getting as
much as possible of this supply to Ger
many FtS. soon as possible.
SchWerdts arrest followed the cX-
animation of more than 10000 papers
which Attorney General Lewis seized
from hugo Schmidt previous to the
trlal OF Bolo Pacha for whom Schmidt
handled the S50.000,000 fund for the
corruption of the press of France.
Among the documents were letters
written by Schwerdt outlining the
wool roundup plan.
Son Sent TO South America
One of the letters introduced Eugene
Schwerdt. IT., employed by Charles f.
WEBB, Philadelphia wool importer, to
German manufacturers in South Amer
lca: 1t was signed by Schmidt
How successful young Schwertd was in
ms South American trip is shown hv a
letter from him to his father, from
Naldlvla, Chile, under date of March 7.
1tl Z. After stating that he had bought
$4,000 pounds of wool, his letter said:
You cannot imagine how extremely
heIpful MI. Schmidt's recommendations
are to me. The different directors of
branches of the Deutsche Bank are do
ing everything they can to help me.
| make friends with people of both
sides, and when it is necessary I con-
ceal my real opinion in the best diplo-
matte manner l can think of. OF
course, it is unwise, but also totally
unnecessary, to let them know that one
has anything to do with the Germans"
A number of letters, in which the
elder Schwerdt admits that he is a
German and shows knowledge of the
German nationality of wool purchasers.
were made public by Mr.. Becker. One
mlssive, written to Hugo Schmidt. Sep
tember 4, 1915, is an inquiry as to the
"hereabouts OF three French prisoners
ana their condition. AS a reason for
THIS unusual request Schwerdt wrote:
we Germans nave certainly an in
n ch l.
barbarians'
Advised Aid to German Loan
In letter TO Schmidt, October q.
l9lo' ochwerdt states that he advised
one Noshiand to invest in the German
war " r loan. A letter from Forstmann e.
uuif imam Company, dated November Q
1915, shows, according to Mr.. Rockor
that this firm acted as dummies for
herman purchasers, among them Herr
+. r. koswlg, one of the largest wool
merchants of Berlin. Schwerdt asked
Ihat unusual precautions be taken that
letters from Koswig did not fall into
british hands. A few months later.
9chWerdt asked Schmidt to send a
message IN code to Berlin, asking Kos
Wig ana others not to write direct.
Schwcrdt, who looks Teutonic and
speaks with a German accent lived at
IA west Seventy seventh Street win
MS Wltc, whose maiden name is Breesc.
he sad he had two nephews fighting
II. the British army. and had two others
n the Belgian army until one was
killed. WOO
..somc time ago the authorities
seized the books in my Boston Office"
ne told reporters but they found
nothing against me. invited them to
lnvestigatc here. have visited the
Office of the Attorney General, where
| have been asked about my dealings
with Hugo Schmidt, but that amounted
TO nothing'
1t was learned that a short time ago.
while at the New York Athletic Club.
Schwerdt's oudly-exprcssed pro- Ger,
resulted in fst-hght with n
member. He is said to have told an
acquaintance that he found himself, af-
ter the encounter, on the sidewalk with
both has eyes blackened
Government Investigated
Schweydt's Boston Office