EAST GERMANY'S PHANTOM BANKNOTES

It felt a bit unreal to carry a large paper bag full of banknotes through security at Frankfurt airport, Lysann Goldbach laughs as she tells the story. One million marks in cash. The airport staff suspected money laundering.

The 36-year-old tried to explain, but was treated with suspicion. It was only when an older security guard arrived that they believed her.

"Yes, these are East German marks" she confirmed.

Goldbach works at the state-owned KfW bank, which was formerly tasked with rebuilding the economy of Germany's east. She is the director of its historical archive, which includes the legacy of the former East German central bank, the "Staatsbank."

In the 1980s, the Staatsbank's vault contained large numbers of freshly printed 200- and 500-mark notes that never entered circulation. A banknote worth a month's salary seemed inappropriate to the communist country's leadership.

But years after the fall of the Berlin Wall, these bills kept appearing at various locations in Germany.

Where did they come from? They must surely have been stolen.

The story begins in 1991, the year after German reunification. All of East Germany's now-worthless paper money was buried in two sandstone caverns near Halberstadt, in the eastern state of Saxony-Anhalt. It was expected to slowly rot.

Following its 1994 merger with the successor to the East German central bank, the KfW became the owner of the money. It assumed it was safe in the underground facility.

But then East German banknotes started surfacing on the collectables market. Thieves had gained access to the caverns. So in a complex operation, the KfW removed the banknotes from the cavern and destroyed them in March 2002. At least it thought it had. But 200- and 500-mark East German banknotes keep appearing - like those in Frankfurt. Dealers are said to be willing to pay 15 euros per bill.

This latest batch of millions has made its way directly to the archive. Now the notes are back in a vault in Berlin in "one of the most beautiful places in the capital," she said. "We can't be much more specific than that about the location."

To read the complete article, see:
East Germany's phantom banknotes (www.dw.de/east-germanys-phantom-banknotes/a-18001532)

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