After the Soviets had played such a major role in the founding of the Communist Party of Great Britain, there was a need for some money to get it up and running properly. For some reason, subsidising foreign communists was always important to the Soviets. In 1989 when it all came tumbling down they found over $100 billion in hundreds of foreign bank accounts, all for the use of subsidising the various communist parties. At a guess it was originally a lot more but a few sticky fingers probably ripped off billions.
Where would a fledgling state like the USSR get its hands on the megabucks need to kick start all those foreigners. It should not be forgotten that those employed by these foreign parties were paying themselves well above average wages. Inside every communist there is a capitalist struggling to emerge.
To return to the matter in hand, the Tsar and his family had thousands and thousands of jewels and the rest of the aristocracy were not far behind. This was the fountain of money the Soviets decided to use. They needed to get them abroad and sell them for currency without anyone being the wiser.
At the end of the Russian Civil War, according to a primary source quoted by historian Sean McMeekin, the Bolsheviks controlled royal gems comprising ‘25,300 carats of diamonds, 1,000 carats of emeralds, 1,700 carats of sapphires, 6,000 carats of pearls, and many other gems – and that was without counting the gold, Fabergé eggs and innumerable other baubles that the Romanovs had amassed, plus the wealth of all the other great noble and merchant families. Local Bolshevik committees, even in the most far-flung places, had been issued with instructions to collect the jewellery and precious stones of provincial notables and the Church and send them through to Moscow. Consignments started arriving at the rate of 400 per week, and sometimes even more, so that by the end of 1920 the new central State Treasury had amassed 23,000 uncracked safes and had to establish a Safes Commission to blow them all open.
One of the first Bolsheviks to start this in the UK was Nikolai Klishko, second-in-command to Leonid Krasin the chargé d’affaires while the Soviets were negotiating the Anglo-Soviet Treaty. On one of his first attempts at smuggling he brought in two suitcases filled with platinum bars. Before the ink had dried on the Treaty, he set up the laundering of the jewels via Amsterdam, the centre of the diamond cutting trade. As they prised the jewels from their original settings, it turned out they had been cut in an old fashioned way and needed recutting to be more appealing. Many of these precious stones were made into art deco jewellery. There was so much of it, the agents had to release it in dribs and drabs to avoid flooding the market.
Nikolai was not alone, an english poet, Francis Meynall, was busy running diamonds from the Baltic states to the UK. The were hidden in chocolates and sweets which had to be removed before the jewels could be sold on via Hatton Garden. There are hints that Mr Meynall and his wife did not pass all the proceeds to the Soviets, a rather dangerous thing to do.
Nikolai seemed to be very busy organising the start of the trade relations between the two countries and was busy setting up ARCOS, this company all trade between Russia and the UK, and the Soviet Trade Delegation. He was well known to MI5 and they monitored all if his many bank accounts. They found various large scale deposits and withdrawals that could not be connected with legitimate trade. The suspicion was that these sums were being used to fund revolutionary movements. He was personally in charge of seven accounts which contained over £1.5 million, rather a large amount for those days.
There were some high-value credits from Sam and Max Rabinoff, brothers who spent time in New York, London and Estonia. Sam paid £25k a week into these accounts and sometimes withdrew a thousand, specifically requesting and notes. Although MI5 had not connected this with the jewellery sales, they were sure it was something to do with the black market. The breakthrough came in 1922 when words came from the French that Leonid Krasin had recently done a deal involving jewels with a merchant in Amsterdam. The merchant was Gronik Papazian who was found in Poland staying in the best hotel with Sam Rabinoff. It seems that parcels were turning up in Warsaw from Moscow and some were being sold on for up to half a million pounds.
Eventually MI5 got hold of a letter from Rabinoff to Klishko which rather gave the game away. The Polish government were turning a blind eye and the Soviets and the merchants did not really trust each other. Much of the money then fled from Amsterdam to London. Some of this money ended up in the coffers of the CPGB where it was used to pay for newsagents to stock its papers and also gave hefty salaries to otherwise unemployable communists. Some things never change do they, can anyone think of people these days who are effectively unemployable but are given large salaries by left wing organisations.
The bank managers, acting on Special Branch instructions, recorded the serial numbers of the banknotes that were handed over to Klishko when he made withdrawals. Surprisingly a portion of these notes were found in the Punjab where the Soviets had been financing revolutionaries. They were discovered when an Indian separatist had tried to convert a bunch of English banknotes and the serial numbers were eventually sent back to London. The Great Game never really ended.
It was apparent that the money the Soviets had gathered from selling the jewels, precious metals and fine art of the Tsarists was ending up in London from where it was spread round the world to finance revolutionaries prepared to further the Bolshevik cause. Before 1917 left wing groups had often withered through lack of money, the Bolsheviks saw it as their duty to ensure this no longer happened. Even up to the final days of the USSR, this model was adhered to. No matter if the money could have been better spent on the Russian people, the global revolution was deemed to be more important.
© well_chuffed 2018