Communist Poland confiscated Polish pre-war military fund. How? And what happened to it?

The history of the National Defence Fund is a ready-made thriller scenario. It’s a story of the generosity of ordinary “Smiths” who rebuilt Poland, of the dedication of people who risked their lives to evacuate the gold against the German threat and of the betrayal of the generals who handed it over to the communist military intelligence instead of the families of fallen Home Army (AK) soldiers. But also of intrigues of the Secret Service, merciless fight for money and tragic deaths of the guardians of the gold treasure. As befits a multi-dimensional drama, the history of the National Defence Fund ended with an astonishing epilogue…

The National Defence Fund (Fundusz Obrony Narodowej – FON) was established by a decree of the Polish President Ignacy Mościcki, issued on April 9, 1936. In the face of the threat posed by Nazi Germany, the idea was to provide the army with more weapons thanks to a public collection. The concept wasn’t particularly original – it’s worth remembering that the whole nation was building the Second Polish Republic at the time. Deputy Prime Minister Eugeniusz Kwiatkowski initiated a four-year economic development plan, the construction of the Gdynia Port and Central Industrial Region got underway.

All of Poland raises money for the army

The FON turned out to be a great success. Participation in the action was the done thing – donations were made by public institutions and individuals: dignitaries, film & theatre stars, scouts and village leaders. Adam Strug’s widow, Nelly, an official in the Foreign Office, a modern woman, parading in pearls and art-déco dresses handed over her family’s jewelry. A certain aristocrat donated his family’s valuables with diamonds, numismatists – jewels from their collections. The athlete Janusz Kusociński offered a gold signet ring, the archer Janina Kurkowska-Spychajowa – eight silver cups. Workers would deposit tsarist “pigs”, i.e. gold 5-ruble coins kept for a rainy day, young couples – gold wedding rings. Sports competitions, football matches and boxing fights were held to raise money for the FON. According to calculations, by the outbreak of WWII the Fund had accumulated approximately PLN 1 billion, out of which the value of individual deposits and donations reached PLN 37,7 million in May 1939.

The money was a contribution to the budget of the Ministry of Defence’s overseen by the General Tadeusz Kasprzycki. It was used to buy weapons and equipment for armament factories. For example, it financed the construction of the ship “Orzeł” [“Eagle”]. The contributions were stored in the basement of the General Staff. In September 1939, they were evacuated via Lublin, Ternopil, Lviv, Horodenka – to Romania. At the Polish embassy in Bucharest they were registered and divided into the “gold” and “silver”. The silver was expedited to Marseilles, but after the capitulation of France it ended up in a bank in Toulouse. It was returned to the Polish People’s Republic in 1976. The gold survived the war in Sudan and didn’t reach London until 1944. Here it was deposited in the Rubens Hotel.
In April 1944, at the request of the Commander-in-Chief, Gen. Kazimierz Sosnkowski, Gen. Stanisław Tatar flew to London. He was the mastermind behind Operation Tempest, promoter of the idea of compromise with the Soviets, a man of unbridled ambition, very self-confident. The official purpose of the trip was to pass a report on the country’s combat preparations. Unofficially, the command of the Home Army simply wanted to get him out of the country. In London, Tatar was appointed Deputy Commander-in-Chief for Home Affairs and hailed as an expert on the Home Army. This is probably why General Marian Kukiel, the Minister of National Defence in exile, entrusted him with the supervision of the FON in 1945, believing that the fund would be used to help former Home Army soldiers and their families. At that time, the gold was stored in eleven artillery chests. Their contents were thoroughly examined and sorted.

Suicide of the treasure guard

By decision of general Kukiel, the treasure was added to the Drawa fund, i.e. 10 million dollars for the Home Army: couriers, Cichociemni [lit. “The Silent Unseen” – special-operations paratroopers], self-help... These funds were managed by general Tatar and his associates: Lieutenant Colonel Marian Utnik and Colonel Stanisław Nowicki. This trio was called the Committee of Three. The aforementioned 10 million came from a donation by American President Franklin Delano Roosevelt, won by the prime minister of the Polish Government in Exile, Stanisław Mikołajczyk. Of these, about 2 million went to London, and about 8 million to Italy, to the town of Latiano, where the secret “Elba” base was located, coordinating airdrops for the Home Army. Its chief was Lt. Col. Marian Dorotycz-Malewicz, code-name “Richard Hańcza”. Only a modest part of the aid reached Poland. After the fall of the Warsaw Uprising, the British stopped airdrops on Polish territory, the last one was carried out on the night of December 26/27, 1944. Meanwhile, “Hańcza” still had 8 million dollars at his disposal. It was a staggering amount. There was a risk that the British would want to take it over.

For this reason, the Committee of Three decided to hide them in the Roman School of Radio Engineering, headed by “Ryszard Hańcza”. The trio instructed him to transfer $5 million to the UK. The other three were to remain hidden. At this point, a ruthless fight for money broke out. In March 1945, the President of Poland-in-exile, Władysław Raczkiewicz, ordered Gen. Władysław Anders, the commander of the Polish II Corps in Italy, to take over the AK dollars. The general summoned Dorotycz-Malewicz and demanded the return of the fortune. However, Tatar was not going to give away millions. He initiated a satanic intrigue aimed at “destroying Anders”. He convinced Gen. Tadeusz Bór-Komorowski, freshly released from the Oflag, that the II Corps would be withdrawn from Italy and the money of the Home Army would be taken over by the British. He persuaded him to send money from Drawa to General Stanislaw Maczek’s 1st Armoured Division stationed in Germany. Except that at the same time he persuaded “Hańcza” to hide 1 million in a convent of the Fatebenefratelli, on the Tiber Island.
On August 4, 1945, trucks stuffed with special Cichociemni belts filled with banknotes and coins set off from Rome. Meanwhile, Anders was keeping the “guard” under surveillance. In September, he arrested him on a frivolous charge and released him. In October, II Corps agents commandeered a million dollars hidden in the monastery. On October 9, they also entered the apartment where “Hańcza” was staying. The officer, seeing them, shot himself in the head... General Bór-Komorowski was shocked by this story. He even set up a commission to investigate the death of the lieutenant colonel, but found little.

Dollar intrigue

By this time, word had spread around London that the Committee of Three was “sitting on the money”. Colonel Józef Kuropieska, a pre-war officer, from October 1945 the head of the Polish Military Mission in London, and from February 1946 the military attaché at the Embassy of the Republic of Poland decided to take advantage of this fact. He established contacts with Tatar, Utnik and Nowicki and persuaded them to transfer millions to the authorities in Warsaw. A report sent by Kuropieska to General Komar has been preserved: “The Tatar and his people have an amount of about three million dollars. I think I convinced him that liquefying this sum and putting it into play in the first year of our three-year plan will be of immeasurably greater benefit to our society than it would later be”.

Certainly, in May 1947, after the rigged parliamentary elections, Tatar decided to transfer FON’s gold to the Polish Embassy in London (against the will of the Polish government in exile). From there, it was transferred to Okęcie – the legend says that as a catafalque of Lucjan Żeligowski, who died at that time. The cassettes with gold were sent to the address of the 2nd Branch of the General Staff of the Polish Armed Forces, i.e. the military intelligence body headed by General Wacław Komar. He is a man with several biographies, functions, performing many secret mission – he fought in international brigades in Spain, secured the needs of the Greek communist partisans, was also supposed to organize intelligence networks in Western European countries.

Soon after, General Tatar visited Poland for the first time. And a few months later, money began to flow from London to Warsaw in regular tranches as part of Operation “Brzoza” [“Birch”]. Officially, part of it was transferred to the Ministry of National Defence, and USD 1.5 million for laboratory equipment for physics institutes in Kraków and Warsaw, buses, medical equipment, medicines... The issue of taking over the money was arranged by economist Wacław Jachimiak, deputy director of the “Unia i Harpun” trading company operating on the coast. It was left in the duty-free zone, from where they were taken over by the endowed institutions.

Augustów Roundup. Soviets fighting counterrevolution their way

That was a Red Army operation in a supposedly independent state.

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In addition, the communists took over real estates in France and England, as well as staff archives and information about people who kept money intended to help Home Army soldiers and families of the arrested (one of them was most likely a world-renowned dermatologist, Professor Marian Grzybowski, arrested in 1949 in connection with the Tatar case, he died during interrogation). In July 1948, Bolesław Bierut awarded General Tatar with the Cross of the Order of Polonia Restituta, 4th class, Col. Nowicki – with the Cross of the Order of Polonia Restituta, 5th class, and Lt. Col. Utnik was promoted to colonel.

Kite smuggling in Wronki prison

A year later, the three officers were invited to Warsaw. They thought they would be received as heroes who donated a fortune for the reconstruction of Poland. But what an unpleasant surprise: they were arrested on charges of conspiracy, espionage and diversion – but not of FON fraud... They faced a military court in a rigged trial of the generals (together with Generals Jerzy Kirchmayer, Stefan Mossor, Franciszek Herman, Col. Marian Jurecki, Major Władysław Roman and Lieutenant-commander Szczepan Wacek. Józef Kuropieska, who ended up being tried separately, was also scheduled to testify.). In August 1951, General Tatar was sentenced to life imprisonment, loss of civil rights for five years and forfeiture of property; Cols. Utnik and Nowicki to 15 years of imprisonment, loss of civil rights and forfeiture of property.

Stanisław Tatar served his sentence in Wronki prison. There he met deputy director Jachimiak (sentenced to 15 years in 1949 in a case involving Tatar, on false charges of espionage), to whom he had transferred FON funds just a few years earlier... The general sent a kite message to an economist and invited him to a meeting in a prison toilet. There, he stated that due to his health, he would most likely not survive prison. He also revealed a “golden” secret to his colleague: he returned to Poland with the agreement of Bolesław Bierut and Józef Cyrankiewicz, while General Marian Spychalski, Eugeniusz Szyr and Konstanty Dąbrowski were discussing the matter. He explained that they took over the gold part of the FON. It was then that Jachimiak found out that apart from dollars, gold was also transferred to the Polish People’s Republic.

In 1956, the general was released from prison and rehabilitated, the colonels also regained their freedom. He tried to clarify the fate of the gold treasure and real estate abroad, he contacted Prime Minister Józef Cyrankiewicz on this matter, but to no avail. Tatar’s investigation was continued by Wacław Jachimiak. He tried to contact Prime Minister Edward Gierek and the editors of Trybuna Ludu. No effect. He tried to publicize the topic in the media, but was unable to break through. In August 1980, i.e. after 24 years, he managed to reach Andrzej Bujnicki, a journalist of “Tygodnik Demokratyczny”, and the latter to the then Minister of Finance, Marian Krzak, and to the President of the National Bank of Poland (NBP), Jan Korczak. Why these high thresholds? Well, editor Bujnicki found out that the treasure delivered to Poland in 11 artillery boxes was deposited in 10 cassettes!
Thanks to the intervention of Minister Krzak, it was established that until 1948 the FON gold was stored in the Ministry of National Defence. In March 1948, 10 sealed cassettes were transferred as a deposit of the Ministry of Treasury to the National Bank of Poland. In January 1951, a special commission of the Ministry of National Defence and the Ministry of Treasury reviewed the deposit and its partial liquidation. 122 kg of gold objects and coins were melted down for scrap and transferred to the NBP vault. Part of it was earmarked for “balance of payments purposes of the state, including partial repayment of debt resulting from international agreements concluded in the interwar period”. 550 gold watches, 156 pieces of jewellery and 155 valuables, including precious stones were left. This part was placed at the disposal of the Civil Chancellery of the President of the Republic of Poland and the Office of the Council of Ministers. Five years later, the deposit left the NBP treasury. Three historic items: Prince Napoleon Bonaparte’s gold medal, a Gold Cross of Merit and a Greek gold coin of Philip II of Macedon from the 4th century B.C. went to museums. The rest of the valuables were sold through the state-owned outlets “Desa” and “Jubiler” (without documenting their source of origin).

Unanswered questions

In November 1981, the Wrocław magazine “Wiadomości” published a report entitled “The Secret of FON’s Golden Treasure”. They ended it with a series of questions, including: why was the case covered up and what was the money from the sale of silver and gold used for? What does it mean that part of the deposit remained at the disposal of the Civil Chancellery of the President and the government? What were the rules for selling jewellery at “Jubiler” and who could buy it?

After 1989, an investigation into the fate of the FON was launched, but it was discontinued due to lack of evidence. A team of prosecutors and inspectors from the Supreme Audit Office reviewed all documents available to them regarding gold from the Fund and found no evidence supporting the hypothesis that the treasures were stolen by communist dignitaries. The team assumed that 208 kilograms of gold went to the Polish People’s Republic and not 350 kilograms, as General Tatar claimed. The investigators questioned many witnesses, including Eugeniusz Szyr, who did not remember much and assured that he learned about the suspicions of gold theft from the FON only in the 1980s. However, they did not review the documents regarding the distribution of approximately USD 2.5 million from the Drawa Fund, part of it in gold. It is not known what these funds were used for.

SIGN UP TO OUR PAGE In 2006, history added a surprising epilogue to this case. The commission supervising the liquidation of the Military Information Services found valuable items in one of the safes, including diamond jewelry, gold coins, gold bars and a gold pen. It turned out that in the special deposit of the operational fund there are the remains of the pre-war treasure of the FON and the “Żelazo” [“Iron”] scandal. This information was confirmed by Piotr Bączek, spokesman for the liquidator of the Services and the then deputy Minister of National Defence, Antoni Macierewicz.

However, the golden mystery has not yet been solved. Questions still remain: how were the millions of dollars in the Drawa Fund distributed? And also what happened to the property confiscated in other cases, such as the “Goldenheads” scandal, i.e. the network that took hundreds of works of art from the Polish People’s Republic and brought back 16 tons of gold? At that time, not only were works of art transferred to museums, the Office of the Council of Ministers, and the Ministry of the Interior were seized, but also significant amounts of gold bars and foreign currency were confiscated?

– Małgorzata Borkowska

TVP WEEKLY. Editorial team and jornalists

– Translated by Dominik Szczęsny-Kostanecki

The exhibition “Don’t waste your independence. Silver from the National Defence Fund. Varsaviana” at the Royal Castle in Warsaw is open until September 10, 2023.

Text sources:
„Kto ukradł złoty FON” Helena Noskowicz-Bieroniowa
„Tajemnica złotego skarbu FON” Wiadomości, 12.11.81
„Afera w polskiej armii. To była walka o miliony dolarów” – Facet.wp.pl
„U źródeł afery TUN. Generał Stanisław Tatar, rozpad Komitetu Trzech i przekazanie komunistycznemu wywiadowi wojskowemu funduszu „Drawa” 1947–1949”, Daniel Koreś, Przegląd Historyczno-Wojskowy
„Skarb Tajniaków” – Wprost.pl
„Asy czy miernoty? Jacy naprawdę byli szpiedzy PRL-u?” – Newsweek.pl
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