And now Finn barely pauses.
‘KoKo was set up in 1961, just after the Wall went up. It was a hybrid trade organisation the purpose of which was to get hold of foreign currency to fund KGB and Stasi operations abroad. Foreign currency wasn’t so easy to obtain for your people after the Wall went up. Your own Wall made traffic from East to West more difficult for the KGB, too. So Schmidtke’s mission was to find new ways to get hold of valuable foreign currency. The rouble was useless, unconvertible, of course.
‘It all started pretty crudely with Schmidtke’s thugs combing East Germany for works of art the Nazis hadn’t hidden–antiques and so on. They just confiscated stuff from their owners and sold it through various dealers from Switzerland and Belgium, London and other places. Schmidtke set up a secret financial pipeline from East Germany to Switzerland in order to launder the money and he learned from Soviet sympathisers and illegal financial operators in the West how to set up offshore accounts, wash money, avoid tax. What he learned about capitalism was how all the grimy underside of it worked, the illegal side, the side used by organised crime. So his main contacts in the West were by and large criminal. But there were bankers too, and lawyers, who operated above the line.’
Finn looks up to the ceiling at this point, as if to make sure that the microphones are picking up his every word.
Nana disappears into the kitchen and comes back with a tray of pelmeni–thin dough pancakes filled with minced lamb–that she’s made, despite dinner being so recent, and puts it on the table next to Finn. She shakes flour from her apron on to the crackling logs in the fireplace and holds on to the mantelpiece for a moment.
‘Are you all right, Nana?’
‘Yes, yes, I’m all right. Just a dizzy spell, Anna. They come and go quickly.’
‘Sit down, Nana,’ Finn says and stands up to plump a cushion on the chair opposite him, but she remains standing. In the corner of the room the Russian flag still flutters on the televison in front of the Kremlin’s cameras, but I’ve turned the television down. Nana can hear only if there’s no background noise.
‘So, in the West, did nobody ask where these artworks came from?’ Nana says.
‘No. There was money to be made. On all sides. In 1961 Europe was in disorder after the Wall went up. There was a lot of movement across the line still and we were encouraging people to come over. Of course, that’s when the KGB put many of their people in place in the West. It was the end of free movement and everyone was trying to get their pieces in position.’
Finn looks at the clock on the wall over the mantelpiece. It is half an hour before the New Year. He gently touches the side of my face in a gesture that Nana says later is the one that wards off evil spirits. Nana has all kinds of superstitions like this from God knows where. To me, Finn’s hand on my cheek feels like protection of sorts too, so maybe Nana is right.
‘You want me to continue?’ Finn says, and a line of worry creases his eyes. He says it as if we are going through some door, some magic portal of no return, or over the brink of a precipice. And in a sense we are.
‘Yes, why not? Go on.’
He brushes the hairs on my temple as he takes his hand away and then continues, as before, carefully laying the words down as if they are a ball of string along which we can find our way back.
‘Well, soon, of course, Schmidtke’s theft of art ran out of steam. There wasn’t anything left. Who knows how much money KoKo made? Millions? Certainly. But new ways had to be found to fund the KGB’s increasing presence in Western Europe and elsewhere. They were funding the Communist parties in France and Italy, for a start. But that’s another story. So Schmidtke turned to what was practically the only thing the Soviets had to offer of their own. Arms.’
Finn now spreads out on his back as if the smallest effort of movement might result in the end of the world. To me, trained observer that I am, it is a position of deliberate vulnerability, of ‘I’m taking a big risk.’ It is the psychiatrist’s couch and the ‘patient’ is peeling off one layer of the onion of his hidden self to test the effect it has.
The fact that we all know about the microphones adds a surreal touch, I suppose. We’re all playing, to some extent, to the third ear in the room–Putin’s Ears, as Finn refers to the microphones later. But while Finn, it seems to me, wants my masters to hear what he is saying, he nevertheless and unnecessarily looks straight at me as if to convey a deeper meaning that cannot be known by anyone outside the room. I know he’s conveying a message to me beyond his words, but that the message in some way includes his words too.
In retrospect, I now realise that it was an appeal, an appeal to me to understand his real motives, the unexpressed, the unsaid.
‘KoKo became one of the biggest illegal arms sales operations in the world,’ he continues. ‘At its height it was selling shipments of weapons all over Africa, the Middle East, South America, China, rebel groups in the Far East…Schmidtke even sold a cargo of small arms out of Rostock to the Americans for their covert war in Nicaragua. Good, solid Soviet-made weapons and East German optics could soon be bought throughout the world. And Schmidtke funnelled the profits down his secret financial pipeline into Switzerland. Two banks in Geneva friendly to Schmidtke and the KGB washed the money and a friendly bank in an obscure Swiss canton invested this laundered money into all kinds of business ventures.’
Finn smiles at a memory. ‘I remember once when I was on a skiing holiday I was sitting on a ski-lift in a canton in Switzerland. I suddenly realised that this ski-lift was, in fact, a KGB investment,’ he says. ‘The technology was Swiss,’ he adds, as if concerned that we might be worrying about his physical safety.
But then he’s serious again.
‘So. When we arrested Schmidtke in Berlin in eighty-nine, several billions of dollars had been laundered by KoKo and invested in all kinds of ways. When we brought him in, Schmidtke was returning from Geneva having deposited over a billion dollars. We were a few hours too late to stop him divesting himself of the cash and bonds. We knew the money was held in an escrow account belonging to one of Schmidtke’s Western agents, a Belgian arms dealer living in Switzerland. We wanted him too, but missed him that time and every time since then.’
‘What does this have to do with Putin?’ Nana asks. ‘Our new President, God bless us.’
‘Putin was one of Schmidtke’s colleagues. He also worked for Schmidtke’s KGB controllers in the eighties,’ Finn says. ‘That’s the connection. Back in the days when he was based in East Germany, Putin and Schmidtke met regularly.’
‘And Schmidtke was clearing out the accounts before German re-unification,’ I say, ‘which is why he was depositing these billions in Switzerland.’
‘Yes. There were a lot of traces to be covered in a very short time,’ Finn replies. ‘Everything happened so quickly after the Wall came down. It wasn’t just Schmidtke and the Stasi and their KGB allies who had a clearout. Every KGB general and some regular army generals in East Germany were stripping the place. Huge Russian air transporters were flying out cargoes of Mercedes stolen in the West and bound for Moscow. The rapaciousness was unbelievable. Do you know that when Mercedes opened a dealership in Moscow at the beginning of the nineties, they couldn’t sell any cars, there were so many already there? Instead, they opened a service centre; they made good money, thanks to Russian driving.’
‘And Schmidtke?’ Nana says.
‘We questioned him for a few weeks in London. We knew he knew everything, all the skeletons, right up to the very top of the political leadership in Bonn. But the West Germans naturally wanted him, too, and they had a greater claim. We let them have him. Perhaps that was a mistake,’ Finn adds.