The transfer order and its motivations On September 13, 1936, the confidential decree from the Ministry of Finance which authorized the transportation of the gold reserves of the Bank of Spain was signed, on the initiative of Minister of Finance of the time, Juan Negrín. The decree also called for the Government to eventually answer for their actions to the
Cortes Generales (Spain's legislative body), a clause that was never fulfilled: {{Quote box • Article I: The Ministry of Finance is hereby authorized to mandate, when considered necessary, the transportation, with the highest guarantees, and to the location esteemed to be the safest, of the gold, silver, and bills present at the time at the central headquarters of the Bank of Spain. • Article II: The Government will, when appropriate, answer to the Cortes Generales for the present decree.Madrid, 13th of September, 1936. The decree was also signed by the
President of the Republic of the time,
Manuel Azaña, who would later affirm that the final destination of the reserves was unknown to him. According to Largo Caballero, Azaña was informed afterwards about this decision due to his emotional state and his reserved character towards the operation: {{Blockquote|Did this decision need to be known by a large number of people? No. An indiscretion would be the stone of an international scandal [...] It was decided that the President of the Republic should not know about it, who was at the time in a truly pitiful spiritual state; thus, the decision was only known by the President of the Council of Ministers (Largo Caballero himself), the Minister of Finance (
Negrín), and the Minister of the Navy and the Airforce (
Indalecio Prieto). But it were the first two the only ones who negotiated with the Russian government. Many authors, such as Viñas, have pointed out that the decision to transfer the gold reserves outside of Madrid was motivated by the rapid advance of the
Army of Africa (commanded by Nationalist General
Francisco Franco) which, since its landing on the
Spanish mainland, had incessantly marched forward towards the capital. At the time the decision was taken, the Army of Africa was stationed only 116 kilometres from Madrid, and the efforts made up to that point to halt its advance had not been even partially successful. However, Nationalist forces would not arrive at Madrid until two months later; not because of Republican resistance, but because of Francisco Franco, who decided to deviate his course to aid Nationalist sympathizers in the
Siege of Toledo in a highly prestigious operation that consolidated Franco's political position and allowed him to be named Head of State by the Nationalist side on September 29, 1936. Madrid withstood the Nationalist offensive until the end of the war, and the Republican government did not relocate to
Valencia until November 6. One of the main protagonists in these events,
Prime Minister Largo Caballero, argued that the transfer of the gold reserves was necessary because of the Non-Intervention Pact and the defection of democratic states previously favourable towards the Republic, which left Madrid under threat from the Nationalist forces. However,
Luis Araquistáin, member of the same political party as Largo Caballero, attributed the events to Soviet constraint. The intentions of the
Federación Anarquista Ibérica (FAI, Iberian Anarchist Federation) of assaulting the vaults of the Bank of Spain to transfer the gold reserves to
Barcelona, the main bastion of the FAI, were also discussed. The anarchists intended not only to protect the gold reserves, but to buy war supplies on their own account. This plan would have been prepared by
Diego Abad de Santillán, one of the most fervent adversaries of Negrín; however, this is considered inaccurate by the
libertarian historian Francisco Olaya Morales, who argues that the gold reserves were transferred to
Cartagena not for security purposes, but because of a preconceived intention to send the gold to Moscow. While the majority of historians consider Minister of Finance Negrín the primary actor of the transfer (either by his own initiative or by the manipulation of the Soviets, depending on different interpretations), it is not clear who first had the idea of sending the reserves outside of Spain. The British historian
Antony Beevor cites versions that attribute to the Soviet agent Arthur Stashevski the suggestion to Negrín of establishing a "gold account" in Moscow, due to the threat posed on Madrid by Nationalist forces and the need to purchase
matériel and raw materials. Beevor also cites Gabriel Jackson and Víctor Alba, who in their book
Juan Negrín, attribute the idea to Negrín himself, arguing that the idea took the Soviets by surprise and that Negrín had to carefully explain his plan to the Soviet ambassador. His friend,
Mariano Ansó, defended him by affirming that he "could not have been and was not the author of the transfer of Spanish gold to Russia; at most, he was a cooperative of minor importance of the Spanish Lenin [Largo Caballero] and his counsellors, at the head of which was
Luis Araquistáin." According to
Martín Aceña, it was Stashevski who proposed the deposit of the gold reserves in Moscow.
Walter Krivitsky, a Soviet agent responsible for military intelligence in Western Europe at the time, who later fled to the United States, stated that when Stalin decided to intervene in Spain, he wanted to ensure that there was enough gold so as to pay for the Soviet Union's aid to the Republic. In any case, it was not until the following day, September 14, that the Council of the Bank of Spain (very reduced after the start of the war) was informed of the Government's decision to appropriate the gold and transfer it. Given that the transfer of the gold had commenced hours before the beginning of the session, the Council was unable to prevent such a decision. Nevertheless, the only two stockholder representatives of the Bank of Spain that had not allied themselves with the Nationalists (José Álvarez Guerra and Lorenzo Martínez Fresneda), submitted their resignation. Martínez Fresneda protested, arguing that the transfer was illegal, since the gold was of the exclusive property of the Bank of Spain, and thus neither the State nor the Government could take hold of it; he also pointed out that the gold guaranteed by law the convertibility of Bank notes, and should therefore remain in the security vaults of the Bank: {{Quote box
Transport of the gold to Cartagena of Madrid. Less than 24 hours after the signing of the decree, on the morning of September 14, 1936, members of the
Spanish Carabineers and various militiamen, sent by the Ministry of Finance, walked into the Bank of Spain. The appropriation operation was led by the Treasury Director-General and future Minister of Finance under the government of
Juan Negrín,
Francisco Méndez Aspe. He was accompanied by Captain
Julio López Masegosa and 50 or 60 metallurgists and locksmiths. The vaults where the reserves were kept were opened, and over numerous days government agents extracted all the gold that was deposited there. The gold was placed in wooden boxes, and transported in trucks to the
Atocha railway station, from there it was then transported to
Cartagena. The city of Cartagena was chosen because, in the words of historian Angel Viñas, "it was an important naval station, adequately supplied and defended, somewhat distanced from the theatre of military operations and from which the possibility of transporting the reserves through a maritime route somewhere else was available." The gold was heavily escorted and was transported via railway, according to witnesses of the events. A few days after the extraction of the gold from the Bank of Spain, Bank functionaries retrieved the Bank's silver, valued at a total of 656,708,702.59 Spanish pesetas of the time, which was later sold to the United States and France between June 1938 and July 1939 for a sum slightly more than 20 million U.S. dollars of the time (a portion of the silver was confiscated by French authorities). With the gold reserves stored hundreds of kilometres away from the fighting fronts, it seemed that the mandate of the confidential decree of September 13 had been fulfilled. The Nationalists, when informed of the movement of the gold, protested against the events. However, on October 15, Negrín and Largo Caballero decided to transfer the gold from Cartagena to Russia. On October 20, the director of the
NKVD in Spain,
Alexander Orlov, received a ciphered telegram from Stalin, corresponding to approximately of gold, only 7,800 were taken to Odessa, corresponding to . Orlov declared that 7,900 boxes of gold were transported, while Méndez Aspe stated there were only 7,800. The final receipt showed 7,800, and it is not known whether Orlov's declaration was an error or if the 100 boxes of gold disappeared.
The travel and its reception in Moscow The convoy set sail for the USSR, arriving at the port of
Odessa on November 2 — the
Kursk, however, would arrive several days later because of technical problems. One of
Walter Krivitsky's collaborators, General of the
State Political Directorate, described the scene at the Soviet port as follows: {{Quote box The gold, protected by the 173rd regiment of the
NKVD, was immediately moved to the State Depository for Valuables (
Goskhran), in Moscow, where it was received as a deposit according to a protocol, dated November 5, by which a reception commission was established. The gold arrived at the Soviet capital a day before the 19th anniversary of the
October Revolution. According to Orlov,
Joseph Stalin celebrated the arrival of the gold with a banquet attended by members of the politburo, in which he was famously quoted as saying, "The Spaniards will never see their gold again, just as they don't see their ears," an expression based on a Russian proverb. (pictured) and
half-sovereigns. The gold was stored in the
Goskhran under military vigilance, and the remaining boxes of gold carried by the
Kursk arrived between November 9 and 10. Shortly after, a recount on the total deposits was carried out; initial estimates suggested that the recount would take a year to complete, and despite it having been done with the utmost care, the recount was finalized in less than two months, having begun on December 5, 1936, and completed on January 24, 1937. 15,571 sacks of gold were opened, and 16 different types of gold coins were found inside:
pounds sterling (
sovereigns or
half sovereigns) (70% of the total),
Spanish pesetas,
French francs,
Louis,
German marks,
Belgian francs,
Italian lire,
Portuguese escudos,
Russian rubles,
Austrian schillings,
Dutch guilders,
Swiss francs,
Mexican pesos,
Argentine pesos,
Chilean pesos, and an extraordinary amount of
U.S. dollars. The total deposit was constituted of 509,287.183 kilograms of
gold coins and 792.346 kilograms of gold in the form of
ingots: thus, a total of 510,079,529.30
grams of crude gold, which at an average of .900 millesimal fineness, was equivalent to 460,568,245.59 grams of fine gold (approximately 14,807,363.8
troy ounces). This amount of gold was valued at 1,592,851,910 gold-pesetas (518 million U.S. dollars). The Soviets did, however, scrupulously examine all coins to identify those that were fake, defective, or did not contain enough gold. The Soviets never explained what was done with the rare or antique coins, but it is doubtful that they were melted.
Burnett Bolloten suggests that it is possible that all coins with numismatic value were separated with the intention of gradually selling them on the international market. On February 5, 1937 the Spanish ambassador and the Soviet representatives
G. F. Grinko, Commissar of Finance, and N. N. Krestinsky, Commissar of Foreign Affairs, signed the final reception act on the deposit of Spanish gold, a document written in French and Russian. Paragraph 2, section 4 of the document stipulated that the Spanish government retained the right of re-exporting or utilizing the gold, and the last clause of the document indicated that the Soviet Union would not be held responsible for the utilization of the gold by Spanish authorities. Said clause established that "if the Government of the Republic ordered the exportation of the gold received as a deposit by the USSR, or utilized said gold in any other way, the responsibility assumed by the People's Commissariat of Finance would automatically be reduced, in whole or in part in proportion to the actions taken by the Government of the Spanish Republic". It was thus clear that the gold reserves deposited in Moscow could be freely employed by the Republic, exporting it or alienating it, and Soviet authorities assumed no responsibility. It is worth noting that the USSR granted the ownership of the gold to the Government of the Republic, instead of to the Bank of Spain, its legal owner. When, on January 15, 1937, the newspaper of the
CNT Solidaridad Obrera denounced the "absurd idea of sending the gold reserves abroad", the government agency
Cosmos published a semi-official note (January 20), affirming that the reserves were still in Spain. Not long after, the disputes between the socialist and communist dominated Republican government and the anarchist organizations and the
POUM would result in the
violent clashes of May 1937, ending in an anarchist defeat. Those involved in the events were soon removed from the scene. Stashevski and the Soviet ambassador to Spain, Rosenberg, were executed in 1937 and 1938. Orlov, fearing for his life, fled in 1938 to the United States upon receiving a telegram from Stalin. The Soviet Commissars of Finance, Grinko, Krestinsky, Margoulis and Kagan, were executed on May 15, 1938 or
disappeared in varying ways, accused of being part of the anti-Soviet "Trotskyist-rightist bloc". Grinko was accused of making "efforts to undermine the financial power of the USSR." The four Spanish functionaries sent to supervise the operation were retained by Stalin until October 1938, when they were permitted to leave the Soviet Union for
Stockholm,
Buenos Aires,
Washington and
México City, respectively. The Spanish ambassador, Marcelino Pascua, was transferred to Paris. == Use of the deposit ==