The Largest Movement of Wealth in History

NB To help you visualise: a tonne of gold would be about the size of a beachball, albeit one you couldn’t lift, or a medium-sized suitcase. If it were a cube, it would have sides just under 15 inches/37.5 centimetres.

"The only thing that really frightened me during the war was the U-boat peril."Winston Churchill

Now that France had fallen, it was time for Operation Sea Lion: Germany's invasion of Britain. It would start with air and naval attacks to soften British defences before an amphibious assault. The Battle of Britain was about to begin.

Britain had 501 tonnes of gold stored overseas, more than half of which was in Canada—over 10,000 bars. (Head of the Bank of England, Montagu Norman, had been buying Canadian mine production steadily through the 1930s.) But in the vaults of the Bank of England, it had some 1,100 tonnes of gold stored, along with another 800 tonnes stored for other nations. They could not let Adolf Hitler have it.

Safety lay on the other side of the Atlantic Ocean, but German U-boats were hunting. Over the course of the war, they would sink over 3,000 Allied ships. History was not reassuring either, given the sinking of SS Laurentic in 1917, when some 39 tonnes were lost to the bottom of the ocean just off the coast of Ireland.

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But beyond keeping the gold from Hitler, Britain needed weapons, food and other war essentials. America's strictly enforced Neutrality Act meant Britain had to pay in gold or US dollars.

In 1940, the British people were forced to register any securities — bonds and stock certificates — they owned. The Churchill government, with its newfound wartime powers, then confiscated them and, wishing to ship British wealth to safety in Canada, secretly moved them, along with several hundred tonnes of gold, to the Scottish port of Greenock. (Take note: your wealth is not safe if your country goes to war).

From there, in June 1940, they were shipped to Halifax aboard the light cruiser HMS Emerald. HMS Emerald made it. The British treasure was put on trains, with the gold sent to Ottawa, and the securities shipped to Montreal, with the Bank of Canada now acting as a sort of surrogate Bank of England.

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But the following month, July 1940, saw the big gamble. 1,500 tonnes of gold were loaded onto five ships. $163 billion worth in today’s money.

Offshore, they met the battleship HMS Revenge, a cruiser, and three destroyers, which served as their escort across the Atlantic: a flotilla of nine under the command of Admiral Ernest Archer. En route, two ships encountered fog and came to a halt for fear of icebergs. Another had engine trouble and had to drop out of the convoy, to be escorted by HMS Bonaventure. But somehow the mission was a success. Not a single bar went missing. It was the largest treasure shipment in history, either by land or sea.

At one point, it was thought three cases were missing, but a mess steward who overheard a conversation between two officers said he had been tripping over something in the kitchen: three boxes had been stored among the whisky.

Most of the gold was spent buying weapons and other essentials from the US, and never made it back to the UK.

Perhaps they needn't have bothered. Over the next months, to the surprise of many, the Royal Air Force successfully defended British airspace against the German Luftwaffe. Victory in the Battle of Britain would be a turning point in the war. In September 1940, Hitler shelved Operation Sea Lion and his plans to invade Britain. He had other battles to fight.

Stories like this fill the pages of The Secret History of Gold (although this one didn’t actually make the cut).

The Secret History of Gold is available to pre-order at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. The book comes out on August 28.

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Until next time,

Dominic

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