The Waterbury Democrat., 1941-09-18

so he was assigned to checking up on German operations in South 1 America.
 One of the facts of life this coun- ter-espionage agent had observed in New York was that NaA agents, when closing Q deal, always produc- ed a roll of bills of fantastic denom- nations like $500, or 5000 or even $lO.O0O. Bills In those sizes are rath- CT rare, as you may have noticed, and because of that they can easily be traced, merely by noting their serial numbers every time they are banked. Knowing this, the rich-r1all- counter. espionage agent started to trail the movements Of some of these big bills.
 THIS GETS
 COMPLICATED
 First of, he found that along in March, 1e4O, 6 roll of these ox- chokers had been used to open an account in New York by Q couple of gentlemen who Q short time pre- viously had entered the United States as refugees, kicked out of Germany by Hitler persecution. Little by little, 1t was found that this ac- count, adding up to $6ll 800, was being transferred by cable to the Bank of Panama, credited to the account of a man who lived in Rio de Janeiro.
 Then a bank in Rio began to draw on the Panama account, and to transfer the funds in U. s. dol- lars to a bank in Johannesburg, South Africa. The purpose of all this international banking was apparent ly an effort to hide the trail. U. S.. big bills were used wherever possible because they are sound currency the world over, and the jugglers tried to make the exchange look like normal business transactions.
 As the money finally got to South Africa, however, 1t was traced and found to be used for the purchase 0 Industrial diamonds in the tllegi- timate diamond trade. Diamond pro- duction is of course closely control- led by the British in South Africa, but q certain amount of bootlegglng in the lower grade industrial dia- monds is carried on. The fact that the Nazis were forced to 90 through all this international undercover stuff shows how desperately the German industrial machine needed these diamonds for their precision cutting and machine tooling.
 Once the diamonds were bought, the problem was to get them back to Germany, ana here Is where the really fascinating game of intrigue began.
 From South Africa, the diamonds were smuggled back to Rio. Now Rio itself is quite Q diamond market, center for the Brazilian fields which supply q part of U. s. industry's low grade diamond demand, but not enough to meet the world demand for the better quality stones. So the Germans, still trying to cover up their trail from South Africa via New York and Panama, took their ssnuggled diamonds right back Into the diamond fields of Brazil and thN'e went through a fake "dis- covery" and mining operation, to make 1t appear their supplies were obtained on the open market.
 AND so
 TO BERLIN
 ostensibly legitimate diamonds, the German supply was now taken in the open back to Rio, and here 1t was legitimate freight which could be taken as legally declared cargo back to Europe. That was easy. Just last month, the diamonds were put on board the plane of an Italian airline running from BaSil to Italy and of they went.
 Discovery of ali this tangled web was unfortunately not made in time to prevent the shipments covered by this particular $6il 800, but from here on this daisy chain is broken. Freezing the bank accounts of Ger mans prevents transfer of funds outside the United states. Black listing of firms acting as German agents has blocked their further commercial activities. And the Brit ish are lot wiser than they were before this began, so a closer check is being kept on the outlaw dia- Imand trade.
 All this intrigue has two rather amazing morals. First, no matter how mistreated or persecuted refu- gees may have been while back in Germany, some of them still aren't above doing business with Hitler, il they can make a profit at 1t. And second, those diamonds could never lhave been flown from Brazil to Italy if U. s. oil companies operat- ing in South America would just stop selling l00-octane aviation gas to Italian airlines.