Gold Warriors

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Gold WarriorsTHE COVERT HISTORY OF YAMASHITAS GOLD

How Washington secretly recovered it to set up giant cold war slush funds and manipulateforeign governments.

By Sterling Seagrave& Peggy Seagrave

Copyright 2001

Contents

Prologue ~ Buried AliveCh.1 ~ Behind the MaskCh.2 ~ rogue Saumrai

Ch.3 ~ The Rape of ChinaCh.4 ~ Storming the IndiesCh.5 ~ Hiding the Plunder

Ch.6 ~ The Eyewitness

Ch. 7~ Down the Rabbit HoleCh. 8 ~ Dirty Tricks

Ch. 9 ~ Heart of DarknessCh.10 ~ The Umbrella

Ch.11 ~ Pointing the WayCh.12 ~ Sanctifying the Gold

Ch.13 ~ The PaladinsCh.14 ~ Loose Cannons

Ch.15 ~ Connect the DotsEpilogue Conflict of Interest


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Gold Warriors

Prologue

BURIED ALIVE

In the closing months of World War II in the Philippines, while General Yamashita Tomoyukifought a delaying action in the mountains of northern Luzon, several of Japan s highest rankingimperial princes hid thousands of tons of looted Asian gold bullion and other treasure in cavesand tunnels near Bambang, planning to recover it later. When the treasure was secure andAmerican tanks were less than twenty miles away, 175 Japanese chief engineers responsiblefor treasure sites throughout the islands were given a farewell party. The party took placeunderground in a large vault stacked from end to end with gold bars. As the evening

progressed, they drank great quantities of sake, sang patriotic songs and shouted Banzai( long life ) over and over. At midnight, General Yamashita and the princes slipped out, anddynamite charges were set off in the access tunnels, entombing the engineers so they wouldnever reveal the locations. The princes escaped to Japan by submarine, and GeneralYamashita surrendered to American troops three months later. Japan had lost the war militarily,but the princes made certain that Japan did not lose financially.

This grisly event remained unknown for half a century, and the hidden treasurewas brushed off as a fanciful legend, called Yamashita s Gold . But an eyewitnessto the entombment has provided us with his personal account. During the war, BenValmores was the teenage Filipino valet of one of the senior princes, EmperorHirohito s first cousin, who decided at the last moment to spare Ben s life and led him

out of the cave. Ben, in his late sixties now and in failing health, took us to the site ofthe fatal drinking party, and over a period of many months gave us a full account ofwhat he saw at 175 sites he visited with his prince, from early 1943 to mid-1945. Bentook us (or our colleagues) to the most important of these sites, and recounted all thathe saw and experienced. We reproduce photos of the sites and some of the originalmaps drawn by Japanese cartographers showing the vaults, their contents, and thebooby traps planted to discourage recovery by anyone else. We cross-checked withother witnesses everything Ben told us. This, in turn, led us to reinvestigate Japan ssystematic looting of twelve countries that it invaded and occupied from 1895 to 1945.

In a previous book, THE YAMATO DYNASTY, we revealed for the first time thatHirohito s brother Prince Chichibu headed Japan s campaign of plunder. His

organization was codenamed kin no yuri (Golden Lily). After reading THE YAMATODYNASTY, bestselling writer Iris Chang, author of THE RAPE OF NANKING, remarked:

The Seagraves have discovered one of the biggest secrets of the twentieth century.What she referred to was a small but significant discovery we made by accident. In thefinal stages of work on that book we were told that in October 1945, American OSSagents learned where some of the Japanese treasure was hidden in the Philippines,and recovered very large quantities of gold bullion, platinum, and loose diamonds. Oursources, who included senior U.S. Government officials and high-ranking militaryofficers, told us that the Truman Administration decided in 1945 to set this treasureaside with recovered Nazi loot, as a secret fund to fight communism in the Cold War.


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The fund would be used to bribe statesmen and military officers, and to buy elections foranti-communist political parties.

We mentioned only the bare details in THE YAMATO DYNASTY because we feltthis was an important subject that merited separate study and investigation. GOLDENLILY is the result, a preliminary report on what we have since learned. We hope thatother researchers will pursue it further.

We have established that in October 1945, when General Yamashitasurrendered and was put in New Bilibad Prison near Manila to await trial on charges ofwar crimes, his personal driver Major Kojima Kashii was tortured by an OSS agentnamed Severino Garcia Santa Romana. This took place at Bilibad under the directsupervision of Captain Edward G. Lansdale, later one of America s best known ColdWarriors. They were torturing the major to discover exactly where the Japanese hadhidden treasure in the last twelve months of the war. They believed that Major Kojima

must have driven General Yamashita to a number of these sites. They knew thatJapanese soldiers had been hiding gold bullion in caves and tunnels, becauseintelligence officers with Filipino guerrilla forces had observed them doing so, and ontwo occasions they had opened the tunnels after the Japanese left, and saw what wasinside. Thousands of other Japanese POWs also were interviewed, adding moredetails to what the OSS knew about Golden Lily.

Early in November 1945, Major Kojima broke under the torture and tookLansdale and Santa Romana to more than twelve sites in northern Luzon ranging fromBambang all the way to Aparri at the upper tip. At that point Lansdale flew to Tokyo andWashington to report up the chain of command, while Santa Romana and others set toopening the first of these vaults. Lansdale briefed General MacArthur and General

Willoughby in Tokyo and then to General Hoyt Vandenberg, head of Central IntelligenceGroup, in Washington, and finally to Clark Clifford, special adviser to President Truman.Truman, after discussions with his cabinet, decided to keep this a state secret. This wasmade easier by the fact that the occupation of Japan was strictyl an American affair,and the Philippines were still an American possession. So Washington completelycontrolled the secret of Golden Lily and the recovery of the treasure.

Lansdale returned to Tokyo with Robert B. Anderson, a future secretary of theTreasury who had been a financial consultant to Secretary of War Henry L. Stimson. Ithad been Stimson s idea to set aside all recovered Axis war loot after the war as acovert action fund to foster anti-communist governments throughout the world. One ofStimson s deputies, John J. McCloy, later head of the World Bank, had worked with

Robert B. Anderson in developing this idea, which was discussed and agreed in secretwhen forty-four countries met at the Bretton Woods Conference in 1944 to plan thepostwar world economy. After further discussions with General MacArthur in Tokyo,Anderson and MacArthur flew secretly to Manila with Lansdale and were taken by SantaRomana on a tour of the sites he had already opened. In them, Anderson andMacArthur strolled down row after row of gold bars stacked two meters tall, representingbillions of dollars in value.

All of this has been confirmed to us by a number of sources at the highest level,including former CIA deputy director Ray Cline, who was involved in all of this from theSanta Romana recoveries in 1945 to Cline s retirement in 1973, at which point he


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became head of the Center for Strategic & International Studies at GeorgetownUniversity. It was also confirmed to us by Major General Lansdale when we interviewed

him at his home in McLean, Virginia, several years before his death, although at thetime we did not appreciate the significance of what he said about the torture of MajorKojima. It was only after working on a number of books related to this topic over someeighteen years, including THE MARCOS DYNASTY, LORDS OF THE RIM, and THEYAMATO DYNASTY, that missing pieces clicked into place and the full impact of whatLansdale had said sank in..

We also located intelligence officers who directly observed the Japanese hidingthe gold in Luzon, including U.S. Navy Warrant Officer John C. Ballinger whose sonGene gave us access to records and photographs.

We had known about Ben Valmores for fifteen years before we knew enough toask him the right questions. We knew that Ben had been the valet of a senior prince,

but he claimed to know the prince only by a nom de guerre, Kimsu Marakusi . It waspartly in an effort to discover which princes were involved that we were led to researchand write THE YAMATO DYNASTY. Eventually, we discovered that Ben s wartimemaster was Prince Takeda Tsuneyoshi, first cousin of Emperor Hirohito and grandsonof Emperor Meiji. When we ran blind tests on Ben using period photos of the princesfrom the late 1930s and early 1940s, with all names removed, he instantly identifiedPrince Takeda, Hirohito s two brothers Prince Chichibu and Prince Mikasa, and theelder Prince Asaka who had commanded the Japanese army at the Rape of Nanking.Ben had spent time with all of them, bringing them tea and cigarettes while they carriedout inventories at each treasure site. Ben had never been outside of the Philippines,and spent most of his life as a rice farmer, so his identification of the princes and their

correct names is persuasive. Subsequently, Japanese sources who had worked forGolden Lily as young men, confirmed to us that these were the senior princescontrolling Golden Lily and reporting directly to Hirohito.

We appreciated all along that this book would come under attack from partisansin Japan and America, who want to prevent this information from becoming publicknowledge. So we have done everything we can to remain neutral in presenting whatfollows. The evidence speaks for itself. The characters in this book are such thatreaders will either love them or hate them. We have tried to leave ethical and moralissues for readers to decide.

The Cold War is over. Circumstances that applied fifty years ago no longerapply. We take a position in favor of full disclosure and sunshine. Yet the secrecy

surrounding this subject is as intense now as it was half a century ago. All officialgovernment and military documents relating to this remain deeply hidden, or theirexistence is flatly denied. In America and Britain, as we recount, those who have madetoo many inquiries about this subject have been arrested or terrorized by governmentagents, without explanation.

When a government decides to keep things secret, lies will be told to protect thesecret. As time passes, these lies multiply, with unfortunate consequences. A statesecret of such magnitude requires such a support network of lies that history becomesdeformed. The number of people benefitting from the lies grows into a bigger and biggerpyramid. Protecting their benefits cause the whole thing evolve into a huge boil, which


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Summer Palace outside Peking, smashing and breaking everything they could notcarry, burning down all the palaces and pavilions. Unable to believe all the gold they

found there, they threw most of it away. The commander of this joint force was LordElgin, whose father had removed most of the sculpture from the Parthenon in Athens. In1900, another allied force of great powers marched into Peking to lift the Boxer Siege ofthe Legations, then went on a rampage of drunken looting and smashing.

What Japan did between 1895 and 1945 was qualitatively different. This was notdrunken looting and smashing. The Japanese were very serious and deliberate. Theyemptied the banks, private homes, pawn shops, factories, art galleries, and strippedordinary people of rings, bangles, the rugs on their floors, even the frames from theirwindows. It was as if a giant vacuum cleaner passed across East and Southeast Asia.Golden Lily devoted special attention to the Asian underworld: triads, sects, racketeers,and above all narcotics distribution networks. Methodical extortion took place, with the

wholesale rape, kidnaping, and mutilation of wives and children.We are told that Japan s wartime elite -- the imperial family, the zaibatsu, the

yakuza, and the good bureaucrats -- ended the war as impoverished victims of ahandful of bad military zealots. We are told that Japan was badly damaged andimpoverished, barely able to feed itself at war s end. In fact, Japan emerged from thewar far richer than before, and with remarkably little damage, except to the matchboxhomes of millions of ordinary Japanese who did not count in the view of their ownoverlords. Obsessed by the urgent need to make Japan a bulwark against communism,Washington excused its wartime leaders, including its imperial family and financial elite,from any responsibility for the destruction and impoverishment of twelve countries. Onlya handful of Japan s wartime leaders were executed as scapegoats. By the mid-

1950s, all Japan s indicted war criminals were exonerated, including gangsters andgodfathers who had directed the world s largest drug trafficking system throughout the1930s and 1940s. Japan s government was put back in the hands of the same menwho had started the war as if the United States had reinstated the Nazi party inpostwar Berlin. All this was financed with plunder and profits wrung out of Asia duringthe war.

From the beginning of the U.S. occupation, General MacArthur, PresidentTruman, John Foster Dulles, and a handful of other Wise Men , knew all about theloot and the continued wealth of the Japanese elite. To protect Japan from having itssecret wealth depleted by demands for war reparations, Dulles met in private with fourJapanese to work out the terms of the San Francisco Peace Treaty of 1951. One of

those four is today Japan s Minister of Finance, Miyazawa Kiichi. According to Article14 of the treaty, It is recognized t hat Japan should pay reparations to the AlliedPowers for the damage and suffering caused by it during the war. Nevertheless it isalso recognized that the resources of Japan are not presently sufficient. To reinforcethe claim that Japan was dead broke, Article 14 of the treaty noted that the AlliedPowers waive all reparations claims of the Allied Powers and their nationals arising outof any actions taken by Japan... in the course of the prosecution of the war . Bysigning the treaty, Allied countries publicly agreed that Japan s plunder somehow hadvanished down a rabbit hole, and all Japan s victims were out of luck. To this day, theDepartment of State, invoking Article 14, does everything in its power to block the


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lawsuits of American POWs who were brutalized as slave laborers by Japanesecorporations that are among the world s richest today. During U.S. Senate hearings in

June 2000, chairman Orrin Hatch of Utah challenged State Department and JusticeDepartment attorneys about the legitimacy of their claim that the 1951 Peace Treatycanceled all rights of victims. You mean our federal government can just say, To hellwith you, Bataan Death Marchers, and you people who were mistreated, we re justgoing to waive all your rights because we have the Almighty power to do so?...Constitutionally, can our government take away the rights of individual citizens justbecause they put it in a treaty. ... We re not asking the Japanese government to pay.We re asking the companies that did the acts to pay, some of these companies aremulti-billion-dollar companies today. He then added, I think the Justice Departmentought to reassess it, and certainly the State Department lawyers ought to reassessthis.

In fact the 1951 Peace Treaty was gerrymandered by secret deals. In exchangefor their cooperation in keeping alive the myth of Japan s bone-crushing poverty, all theAllies signing the treaty received portions of the gold bullion recovered by SantaRomana. It has been confirmed to us by former CIA deputy director Cline that the goldbullion Santa Romana and Lansdale recovered was secretly moved to nationaltreasuries and prime banks in more than forty-two countries, including Great Britain.One reason for these secret kick-backs was to allow the central governments ofAmerica s allies to make covert use of the gold without having to compensate citizenswho had been victimized and impoverished by the Japanese. A note written to BritishForeign Secretary Herbert Morrison during these secret negotiations confirms that if thereparations question was allowed to get out of hand, it could end up including not just

Western victims but Asian victims in the hundreds of thousands. If that happened, theamount the badly-strapped British government could expect to see from the deal wouldbe derisory. 1

This black gold was earmarked for certain purposes. One of these was thecreation of slush-funds in countries like Italy and Greece where there was a seriousdanger of the communist party gaining power. In Japan, General MacArthur and histeam set up a number of slush funds including one called the M-Fund, afterMacArthur s financial deputy General Marquat (which we study at some length inchapter nine). According to well informed Japanese sources, the M-Fund was turnedover to the exclusive control of Japan s Liberal Democratic Party in 1960 by VicePresident Nixon, in return for their support in getting him elected president of the United

States. Whether Nixon should have done this raises very provocative questions. It isonly one of several instances when Nixon is now known to have put his own interestsahead of those of his country.

Japan s M-Fund is now said to be worth $500-billion, and is controlled by LDPkingmaker Nakasone Yasuhiro, who uses it to keep Japan a one-party state run by thehard-right, and to prevent any meaningful reform. To enlarge the M-Fund, while keepingit out of sight, former Prime Minister Tanaka Kakuei issued promissory notes called

57s" because they were issued in the 57th year of Hirohito s reign, 1982. Theexistence of these 57s has been emphatically denied by Japan s government, but hasbeen confirmed by a former minister. We provide evidence with photocopies, and show


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that they were printed and produced by the Ministry itself. Japanese sources say thatwhen the true story of the 57s breaks in Japan in the months ahead, it will bring down

the LDP regime once and for all, and explode the secret M-Fund. It may also cause thecrash of Japan s stock market, with reverberations around the world. This explains theintense effort to suppress all knowledge.

Today, there is enough evidence of postwar collusion between Tokyo andWashington to merit a Congressional hearing and a General Accounting Officeinvestigation. Because of vested interests, and half a century of lying and cover-up, thiswill not happen until more of the story becomes widely known and citizens demand thattheir elected representatives and government bureaucrats strip off the dishonest maskof national security . It has taken victims of the Nazi Holocaust nearly six decades ofconcerted effort to recover their assets hidden in Swiss banks, to gain compensation fortheir years as slave labor in giant German corporations including Volkswagen, and to

retake possession of artworks stolen from the walls of their homes and offices. It wasthe success of Holocaust victims, along with the 50th anniversary of the surrender ofJapan, that recently encouraged other victims around the world to come forth with theirstories and demands for compensation. Interwoven in their testimonies of brutality,more and more evidence is emerging about Golden Lily. Japan s victims are wakingup to class-action suits and cooperating on an international level previouslyunimaginable.

More than half a century late, the last battle of the Pacific War is being waged incourts in the United States and Japan where surviving POWs, slave laborers, comfortwomen, and civilian victims of Japan have filed billion-dollar lawsuits to wincompensation mysteriously denied them after the war. In 1995, it was estimated that

there were 700,000 victims of the war who had still received no compensation. Todaytheir numbers are dwindling rapidly because of age and illness. Backing them is anextraordinary coalition including international law firms with years of experience fightingfor compensation from German industries and Swiss banks, for crimes committed andmoney looted during the Nazi Holocaust. One key player is New York attorney EdwardD. Fagan, famous for his recent billion-dollar settlements on behalf of Nazi Holocaustsurvivors. Another is top London solicitor Martyn Day, who has led the way in suingJapan on behalf of thousands of British and Commonwealth victims. Governmentsanxious to block this tide of legal discovery Britain included are rushing to makeone-time pay-offs to the victims.

In Japan, rival factions struggling to control the M-Fund have turned repeatedly to

murder to keep it secret. Others have leaked information to journalists. In the UnitedStates, control of clandestine funds became dominated by a far-right CIA splinter groupcalled The Enterprise, which has been exposed by Iran-Contra and other scandals.Many of the retired admirals and generals who head The Enterprise have tried toengineer further recoveries of Japanese war loot in the Philippines. We include anumber of their misadventures in this book, which demonstrate that peer review isurgently needed.

Evidence of Golden Lily comes from U.S. legal actions. Such simple things asthe probating of the will of Santa Romana, verification of his tax records, and legalevidence of his fortune deposited in Citibank, Chase-Manhattan, and elsewhere,


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provides hard proof that the world is awash with clandestine bank accounts growing outof Golden Lily. We tell how Cline and other senior American government officials

became involved in trying to pry Santa Romana s hidden assets out of Citibank andother banks.

Other lawsuits in the United States prove that Asian war loot was indeed hiddenin the Philippines. In one case, Rogelio Roxas, a Filipino locksmith, found a one-tonsolid gold Buddha and many gold bars hidden in a cave at Baguio only to have it stolenfrom him by President Ferdinand Marcos. Roxas was then tortured and murdered. Buta court in Hawaii has awarded his heirs a judgment of $22-billion against the Marcosestate. Evidence generated during this court case is overwhelming.

Another extraordinary legal battle is the case of former U.S. Deputy AttorneyGeneral Norbert Schlei, who is fighting for his survival after being stung by the U.S.Treasury department when he learned too much about Japan s M-Fund. Schlei is only

one of many innocent people who have been terrorized by the U.S. government whenthey made inquiries about gold certificates based on Golden Lily loot. Instead of bribingstatesmen, politicians, and generals with gold bullion, the bullion remains in primebanks and the individuals are given gold certificates of various kind. So long as thestatesmen, politician or general remains faithful, he benefits from the proceedsgenerated by the leasing of the gold. But if the individual or his heirs tries to cash in thecertificate for the bullion itself, or the dollar equivalent, he is informed that the certificateis counterfeit, as demonstrated by typographical errors and misspellings on thedocument, planted there long in advance. We document a number of instances when anindividual or his heirs tried to press the matter and were threatened by governmentagents with arrest warrants and subpoenas for attempting to negotiate fraudulent

financial documents . We recount astonishing cases where innocent people havebeen terrorized for merely asking whether a document is legitimate or counterfeit. Insuch cases, the United States legal process, and its British counterpart, have been usedto silence and intimidate people who have accidentally stumbled onto what some callthe global Black Eagle fund. The name appears to refer to the secret accord on Axiswar loot reached at Bretron Woods in 1944, sometimes called the Black Eagle treaty.

America s clandestine recovery of these huge quantities of Japanese lootedgold bullion made collusion possible on a monumental scale. For example, wedocument how General MacArthur had a secret joint account at Sanwa Bank with hisold adversary Emperor Hirohito a bank account so big that by 1982 it was payingnearly $1-billion interest per year. We show how President Marcos discovered the

existence of this account and used it to blackmail the government of Japan blackmailthat backfired when America and Japan got fed up with the Marcos greed and he wasremoved from power by U.S. troops.

During the eighteen years we have been investigating this subject, we have beendeeply skeptical about the huge dollar values cited in evidence about Golden Lily.Officially, there is said to be only about 130,000 metric tons of processed gold in theworld including bullion, coinage and jewelry. The law of gold is like the law of gravity,something we rely upon as a universal truth. In fact, nobody really knows how muchgold there is. We do not know how much was looted by Spain from the New World,because once it reached Europe most of it had to be passed on to the great European


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banking families, the Fuggers and Welsers, who had financed the conquest of Mexicoand Peru. We do not know the actual wealth of the Krupps, the Rothschilds, the

Oppenheimers, or the Rockefellers. Economists tell us that there is some $23-trillion inthe hands of the well-heeled , much of it sleeping in offshore private accounts wherebanking secrecy and local laws keep these assets hidden from the tax-man, spouses,business partners and clients. We know even less about the gold holdings of the greatAsian and Middle Eastern dynastic families, trading networks, and underworldsyndicates. Asians have never trusted governments or banks, preferring to keep theirwealth in small gold bars and gemstones, and in China this distrust goes backthousands of years. We can be reasonably sure that the amount tucked under the rugin Asia is far more than what has been amassed in Europe or North America in the twoor three centuries since Western banking (and the gold market as we know it) came intoexistence.

In short, gold is one of the world s biggest secrets. We explain clearly andsimply why governments do not want you to know there is so much gold in circulation.Just as in the diamond trade, the value of gold is thought to be determined by rarity, orlimited supply. This may have been true once, but today it is pure myth. Diamonds andgold are only rare now because they are hoarded by a small number of wealthypeople, banks, and government treasuries that control the price by market manipulation.Instead of dealing in gold, brokers deal in derivatives.

We document how today billions of dollars of black gold remains in the coffers ofthe biggest international banks such as Citibank, Chase-Manhattan, Hongkong &Shanghai Banking Corporation (HSBC), and Union Banque Suisse (UBS). In manycases we provide physical evidence in the form of bank documents signed by senior

executives whose signatures we have already affirmed. In the case of Citibank, whichdenied the existence of many Santa Romana accounts at its New York head office, weprovide a list obtained from the New York State tax office in Albany, which includes allthe account numbers in question plus the notation that no state or federal tax has everbeen paid on these accounts.

We provide interviews with brokers who carried out huge transactions withGolden Lily treasure recovered by President Marcos, photocopies of letters andcontracts.

We include photos of major gold recovery operations while they were under way,on land and sea, including Japan s recovery of the Op ten Noort, a captured Dutchpassenger liner used by Golden Lily to carry treasure to Japan safely under guise of

being a hospital ship. After returning to Japan in 1945, she was scuttled off the MaisaruNaval Base with over 20,000 metric tons of gold aboard. The treasure was recovered in1990. The names of the Japanese recovery ships, and the Australian recovery ship andsubmersible, are all clearly visible in these photos.

We include handwritten letters and diagrams from a CIA station chief in Manilashowing how a group of senior U.S. Government officials and Pentagon generals hopedto use recovered Golden Lily treasure to finance a right-wing vigilante force, and tocreate a new military-industrial complex controlled by them.


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We were given exclusive access to an archive of some 60,000documents, and hundreds of hours of audio and video tapes made orcollected over 25 years by American mining expert and metallurgical chemistRobert Curtis, who physically recovered $8-billion in gold bars for PresidentMarcos. After nearly being murdered by Marcos, and fleeing the Philippines,

Curtis was fascinated by the historical importance of documenting thetreasure. In the course of engineering five major gold recoveries, Curtis wasable to study many of the Golden Lily treasure sites personally, giving him anunrivaled understanding of the techniques employed by Japanese engineers.Today Curtis has a $78-billion default judgement against the Marcos estate torecover his share of those gold recoveries.

During the months that Curtis was working with President Marcos, hewas able to photograph 173 of the treasure maps done for Prince Chichibu byJapanese cartographers. One set of these red series maps was left byPrince Takeda with Ben Valmores in June 1945, in case the submarine onwhich he was returning to Japan was sunk. We reproduce several of these

maps in this book.Just down the coast from Manila in Batangas Province is a dramatic

treasure site that could one day be turned into a Golden Lily theme park. Ithas been the target of several Japanese recovery efforts in recent years.Overlooking the South China Sea, it is a big headland with so many tunnels itresembles a Swiss cheese. Because these include gun emplacements, itearned the nickname Guns of Navarone . (We were asked not to identifyit s location more precisely.) This complex was started by the Japanese inthe early 1920s, as part of the long-term strategy for their conquest of thePhilippines, and was filled with treasure in 1944. In a sheltered cove at thebase of the hill is the entrance to an underground pen adequate for a small

submarine or gunboat. At one side of the cove by the beach is a large mangotree that was used as a bollard to tie up subs and patrol boats. Ben Valmoreswas there several times with Prince Takeda. In 1999, he told us he saw agunboat at anchor in the cove in 1944, with spring-lines tied off to the tree.Nearby, there are tunnel entrances in different parts of the headland. Thesewere sealed in late 1944, covered with soil and disguised with bananas,bamboo and papaya. Each leads to a tunnel big enough for large army trucksto drive in fully loaded. Three of the entrances have since been opened byJapanese groups, who removed backfill and found trucks loaded with goldbars. They were so happy with what they found in the outer reaches of thetunnels that they went no farther. Why not be content with three or four metrictons of gold, and leave the rest for later? 2

But let us begin at the beginning, with Korea.


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Gold Warriors

Chapter OneBEHIND THE MASK

During the night of October 7, 1895, thirty Japanese assassins forced theirway into Koreas royal palace in Seoul. 3 Bursting into the queens privatequarters, they cut down two ladies-in-waiting and cornered Queen Min. Whenthe Minister of the Royal Household tried to shield her, a swordsman slashedoff both his hands. 4 The defenseless queen was then stabbed and slashedrepeatedly, and carried wailing out to the palace garden where she wasthrown onto a pile of firewood, drenched with kerosene, and torched. AnAmerican military adviser, General William Dye, was one of several foreignerswho heard and saw the killers milling around in the palace compound with

drawn swords while the queen was being burned alive. Japan declared thatthe murders were committed by Koreans dressed as Japanese in Europeanclothes a gloss greeted with ridicule by the diplomatic community.5According to the British minister in Tokyo, Sir Ernest Satow, the assassinswere in fact led by First Secretary Sugimura of the Japanese legation inKorea.6The grisly murder of Queen Min was a turning point in Japans effort to gaincontrol of Korea, by taking advantage of a domestic quarrel within its royalfamily. Her husband King Kojong was a weakling, easily manipulated by hiswife and her faction, who were allied with China and hostile toward Japan.The Japanese wanted to be rid of the queen, so they could install a puppet

regent who would obey their orders. 7Many Japanese leaders like Ito Hirobumi were enlightened and reasonablemen. They would have vetoed the murder had they known. But the coup wasplanned in secret by Tokyos top diplomat in Korea, Miura Goro, an agent ofJapans aggressive Yamagata clique. Whether they intended to kill her in fullview of foreign observers is another matter. Japanese conspiracies oftenbegan quietly, then went wildly out of control. 8At first, the killing was to be done by Japanese-trained Korean soldiers, 9so itcould be passed off as a local matter. But Miura decided to call for help fromthe Japanese terrorist organization Black Ocean.10 Many of its memberswere in Korea posing as business agents of Japanese companies, includingthe oldest zaibatsu, Mitsui. Black Ocean and Black Dragon functioned asJapans secret paramilitaries on the Asian mainland, carrying out missionsthat could be denied by Tokyo. 11 While Black Ocean was obsessed withgrabbing Korea, Black Dragon -- named for the Amur (Black Dragon) Riverseparating Manchuria from Siberia was devoted to blocking Russianencroachment, and seizing northeast China for Japan. Black Ocean providedMiura with the assassins he needed that night,12 and the remainder of theassault force were grunts from the Japanese consulate security detail. 13Queen Mins murder marked the beginning of a half century of extremeJapanese brutality and industrial scale plunder that ended with the atom

bombing of Nagasaki in 1945, a period when everything Japan did got out ofhand. Mins murder is a useful marker because it shows how easily the mask


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of good intentions could slip and reveal hideous reality. For example, it isunlikely that Japan intended all along to have its armies stage the Rape ofNanking in 1937, butchering some 300,000 defenseless people in full view offoreign observers, but matters again got out of hand. 14 Had the Rapehappened only once, it might have been a grotesque accident. But variations

of Nanking happened many times during Japans lightning conquest of Eastand Southeast Asia. By the time they overran Singapore in 1942 the atrocitiescommitted against Chinese civilians there known as the Sook Chingmassacres were happening all over Southeast Asia, and not only toChinese.That matters so often went out of control suggests there was more to Japansconquest than a purely military operation. Few history books take into accountthe role of the underworld, because scholars rarely study outlaws. (Oneexception is the recent flurry of scholarship on the Shanghai underworld.)With Japan, we must always consider the underworld because it permeatesthe power structure, as darkly satirized by the films of Itami Juzo. 1516

There was a deep contradiction in Japan as she armed and modernizedfollowing the Meiji Restoration in the nineteenth century. Two powerstructures competed for power behind the throne. Some statesmen, like Ito,were more Western in their outlook and sought to emulate the role ofBismarck with Kaiser Wilhelm, or Disraeli with Queen Victoria. Others, likeGeneral Yamagata, were throwbacks to a medieval Japan where real powerworked in the shadows, using assassins, surprise attacks, and treachery. Sowhile Yamagata and his clique built a modern conscript army, they also built agreat network of spies, secret police, yakuza gangsters and paramilitarysuperpatriots. These were key components of the police state Yamagatacreated. And when Japans armies invaded Korea and Manchuria, gangsters

and paramilitary superpatriots were the cutting edge. They played a major rolein the looting of Asia from 1895 to 1945. Many members of Japans imperialfamily, and financial elite, had intimate ties to these secret societies. Whateverwould be the outcome of the war militarily, they intended to make sure thatJapan was forever enriched.The conquest and subjugation of Korea was Japans first experiment inplunder on an industrial scale. Until then, the Japanese people had generallyremained aloof on their secluded islands, quarreling among themselves. Inancient times they were raided by marauders from the Korean peninsula, andseveral times raided Korea in return, but these were medieval warriors. Theirmutual loathing has its parallel in the Catholics and Protestants of NorthernIreland. 17

Most of us know so little about Korea that it is astounding how much therewas to steal. Historian Bruce Cumings says that in ancient times Koreasinfluence on Japan was far greater than Japans influence on Korea. 18 19When they first began feuding two thousand years ago, there was no Korea orJapan as we know them today. In different parts of the Korean peninsulathere were city-states with highly developed economies that supportedmagnificent religious, literary and artistic cultures. The northernmost kingdom,Koguryo, stretched from what is now Port Arthur, all the way to Vladivostok,and south nearly to Seoul. Down the east coast of the peninsula, facing

Japan, sprawled the rich kingdom of Silla. The third kingdom, Pakche, in thesouthwestern corner, is known today as the Cholla Provinces, famous for its


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dissidents. Of these ancient states Koguryo was the most powerful, protectingthe entire peninsula from Chinese incursions. Koguryo was famous for itsporcelain, among the most prized in the world today. Southern Pakche andSilla were celebrated for paintings, sculpture, gold filigree, and decoratedporcelain.20 Their wealthy elite lived in palaces with thousands of slaves.

Taking no interest in commerce or warfare, they developed astronomy,mathematics, wood block printing, 21 and invented movable type long beforeanyone else. 22 In 918 the peninsula was united by a Korguryo leader whoshortened the name to Koryo. Under his dynasty, which ruled until 1392,2324Korea was among the most advanced civilizations in the world.25The Chosondynasty that succeeded it remained in place until 1910, when Japan annexedKorea.Across the strait in Japan, in ancient times, clans of immigrants from Chinaand Korea gradually drew together into a loose confederation ruled by Shintopriests and priestesses. 26Centuries passed before they submitted to any realcentral authority, and a thousand years later Japanese warlords were still

feuding. This chronic conspiracy produced what one historian calls Japansparanoid style in foreign policy. 27 If Japanese treated each other ruthlessly,why should they treat foreigners otherwise?Koreans despised Japanese as uncouth dwarfs. They infinitely preferred themore cultivated Chinese, comfortably accepting a tributary role to China. Inreturn, China protected them from Japan.From time to time, Japanese warlords set out to crush Korea and erase itsculture from the face of the earth.28 In the sixteenth century after ToyotomiHideyoshi unified Japan, he launched an invasion of Korea with 158,000 men,including samurai, hordes of footmen, and what passed in those days forlogistic support. After several years of occupation, Korea was rescued by

Admiral Yi Sun-shins famous Turtle Ship, the worlds first ironclad 65-feetlong, firing cannon balls filled with nails.29 Admiral Yi cut Japans supplyroutes and destroyed its ships. Hideyoshi was crestfallen, dying soonafterward. 30Despite his failure, Japan profited by looting Korea. Toyotomis invadersincluded monks and scholars assigned to steal Koreas finest manuscripts.Samurai kidnaped masters of ceramics and made them slaves in Japan,where they found sources of suitable clay in Kyushu. 31The kidanpping of RiSam-pyong. See James Sterngold south Korea Wants Japan to Return Art,from THE NEW YORK TIMES, July 11, 1991.32 Judged by their behavior asthey ravaged the peninsula, a Korean scholar concluded that Japanese werewild animals that only crave material goods and are totally ignorant of humanmorality. 33 Centuries later, when Japan once again invaded the mainland,its armies again included teams of monks and scholars to loot the finest artworks from the mainland.Plundered of so much wealth, Korea did not fully recover. In the nineteenthcentury it was still the least commercial country in East Asia, its armyceremonial, a nation ripe for the picking. 34 The Choson dynasty neverregained its pluck. Its kings were indecisive and easily stymied.35Next door,China was on the verge of collapse, in danger of being divided up by theWestern imperialists, and in no shape to defend Korea.

Frightened of becoming a chunk of meat in the midst of tigers,

36

. Japanmade a convulsive effort to modernize,37 and became the first Asian nation


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able to compete with the Western Powers on their own terms. As her navydeveloped and her army grew, Japan found itself in a position for the first timeto launch a modern campaign of mechanized conquest on the mainland,where she could acquire a colonial empire of her own. 3839 If Japan did nottake control of Korea, Manchuria, and Taiwan, they would soon become

outposts of Russia, France or England. Korea was rich in rice, wheat, mineralresources, and manpower, all of which Japan needed. 40 41Many game planswere discussed. 42 The British guessed what was coming. Relying oncunning tricks, its diplomats in Peking noted in 1879, Japan is trying tomaster the Orient. 43They were right. Japans chronic conspirators, army strongman Yamagataand Black Ocean boss Toyama Mitsuru, were only waiting for an event thatwould give them an excuse to invade, and allow them to put the blame onSeoul. Agents of Black Ocean and Black Dragon were in position throughoutthe Korean peninsula and across northeast China, running brothels,pharmacies, pawnshops, building networks of influence by supplying local

men with money, sexual favors, alcohol, drugs, pornography, and SpanishFly.Several false starts were made, as Japan provoked incidents. China gamelycountered. In 1884 Tokyo tried again, paying Korean radicals to attempt acoup. Again, Chinese troops intervened, but not before the Korean coupleader, Kim Ok-kium escaped to Japan with the help of Black Ocean. 44 In

1894, Kim was lured to Shanghai where Chinese agents shot him dead. Hismurder was the catalyst that brought about the Sino-Japanese War of 1894-95.45Yamagata urged Black Ocean to start a conflagration; then it would behis duty to go extinguish the fire.Starting a fire proved easy. Korean peasants were so downtrodden that many

joined a religious sect called Tonghak, which dreamed of overthrowingKoreas incompetent rulers.46 Black Ocean terrorists attacked Tonghaks,provoking skirmishes that resulted in Japanese casualties. Japan sent troopsto protect its citizens in Korea. When news came that China was sending1,500 soldiers aboard the chartered British ship S.S. Kowshing, Yamagatadispatched a force of 8,000. A Japanese squadron intercepted the Kowshingand fired a torpedo point blank, sinking her with all aboard. Those Chinesewho did not drown were machine-gunned in the water. The Japanese hadstruck before war was declared, setting a precedent to be followed manytimes in later decades.47 Imperial China, her back to the wall, declared waragainst Japan.On September 17, 1894, in the mouth of Koreas Yalu River, the Japanesedestroyed half of Chinas navy in a single afternoon, the most significant navalvictory since Trafalgar. Japan then captured Manchurias impregnable PortArthur, and the fortified harbor at Weihaiwei in Shantung, sinking all Chineseships in the harbor. With the fall of Weihaiwai, the war was essentially over.By the end of February 1895 Japan controlled the whole of Korea andManchurias Liaotung peninsula. China sued for peace.Japans victory brought it unexpected dividends. China agreed to pay suchhuge indemnities in gold bullion that Japan was able to go on the goldstandard, 48 putting Tokyo on equal terms in the international money market. 49

China also turned over control of Taiwan, Japans first colony.

50

Control of


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Manchurias Liaotung peninsula and Port Arthur were also turned over, butFrance, Germany and Russia advised Japan to return it.In Seoul, Queen Mins faction refused to cave in to Japanese bullying. This iswhat cost her life that grim night in October 1895. 51Now that Japan had tasted military victory over China, its biggest neighbor,

she felt growing confidence of her ability to take on and defeat one of theEuropean powers. The obvious target was Tsarist Russia, which wascontinuing to make inroads in Manchuria. On February 8, 1904, having madeno declaration of war, Japan launched two surprise attacks, one on theRussian naval base at Vladivostok, another on two Russian warships in themouth of Inchon harbor.52 The Tsar rushed his Baltic fleet half way aroundthe world, only to see it destroyed by Japans navy in the battle of Tsushima,in May 1905. Russia sued for peace, giving Japan the lower half of SakhalinIsland, transferring to Japan its lease on the Liaotung peninsula, and givingJapan control over the southern section of its Manchurian Railway, betweenPort Arthur and Changchun. 53 This gave Japan the foothold in Manchuria

she had been craving for thirty years.In Korea, a thoroughly frightened King Kojong caved in to Japanese demandsand allowed Tokyo to build up a massive military presence in his country. InApril 1905, Tokyo formally established a protectorate over Korea, placing alldomestic affairs under the control of a Japanese governor-general. Nobodyasked Koreans what they thought. Western governments had long concludedthat the situation in Korea was hopeless, the country ungovernable, needingan overlord to establish order, end corruption, and develop modern commercefor the benefit of the Korean people. That January, President TheodoreRoosevelt had assured Japans envoy in Washington that the United Stateswould not protest if Japan provided Korea with protection, supervision, and

guidance. Britain, in keeping with the Anglo-Japanese Alliance, backedJapans takeover, providing that Tokyo maintain an open door allowing othernations to pursue economic opportunities in Korea. The Treaty of Portsmouthconcluding the Russo-Japanese War made it final. Koreas fate was sealed.This was followed by an explosive increase in Japanese economic dominationof Korea. Great numbers of Japanese carpetbaggers arrived to make theirfortunes. Along with them came legions of agents for the great zaibatsu conglomerates, pouncing on every commercial opportunity, every naturalresource.54 Japan also took full control of law and order in the Koreanpeninsula, creating new police and secret police networks.55No longer making any pretense of chivalry, Japan abused Korean sovereigntyat every turn, brutally crushing resistance of any kind. A Korean newspapereditor was arrested when he published an editorial saying: Ah, how wretchedit is. Our twenty million countrymen have become the slaves of anothercountry! 56There were still many Japanese who earnestly believed that they were inKorea to help, not to plunder. Ito Hirobumi told Korean officials, Your countrydoes not have the power to defend itself... I am not insisting that your countrycommit suicide... I expect that if you thrust forward boldly, the day will comewhen you will advance to a position of equality with us and we will cooperatewith one another. 57

The appointment of the aging and increasingly irascible Ito as the firstJapanese viceroy of Korea gave the country some hope of rational


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government. But Yamagata had seen to it that the boss of Black Dragon,Uchida Ryohei, was assigned to Itos staff. Secretly financed from JapaneseArmy funds, Uchidas thugs went on a rampage, murdering 18,000 Koreansduring Itos time as viceroy. Disgusted by the bloody meddling, Ito resigned in1909 only to fall victim himself to Black Dragon assassins. His murder at a

railway station in Harbin was immediately seized upon by Yamagata as apretext to arouse public support for full annexation of Korea. On August 22,1910, just a few weeks shy of the 15th anniversary of Queen Mins murder,Korea was fully incorporated into Japanese territory.58 Tokyo justified theannexation because the existing system of government in [Korea] has notproved entirely equal to the duty of preserving public order and tranquillity. 59The takeover of Korea provided Japans new army with the beginning of itsown domain on the Asian mainland, free of interference from politicians.One of the most rabid of Japans fighting dogs was appointed the firstgovernor-general of the colony, General Terauchi Masatake the man whohad overseen its annexation, and now would oversee the looting and plunder.

Terauchi, who had lost his right hand during Japans great samurai rebellionof the 1870s, was a protg of General Yamagata. He had served Yamagataas inspector-general of military education in the 1890s, and as army ministerduring the Russo-Japanese War. He remained in that post, concentratingmost of his attention on Korea, till he became the first governor-general ofKorea in 1910. His regime was extremely brutal, and it set a pattern forJapanese behavior in all the countries it would occupy till 1945. Terauchipromised Koreans that I will whip you with scorpions! 60He set up a Koreanpolice force and ordered it to use torture as a matter of course. 61 Terauchisobject was to destroy all anti-Japanese activities and participants.62 He gavethis job to Japans military secret police, the kempeitai.

The kempeitai was closely linked to Black Ocean. In fact, Black Oceanregularly reviewed the appointment lists of kempeitai officers being sent toKorea.63Originally established by Yamagata in January 1881 as a way of enforcing theconscription of recruits for Japans new national army, the kempeitai was atfirst an elite corps of only 349 men. In appearance they were unmistakable,dressed in bright green coats, black trousers with yellow stripes down thesides, high black boots and caps banded in red. 64As the national army grew,the kempeitai changed into a secret police force watching both soldiers andJapanese civilians. Their bright plumage gave way to unobtrusive fielduniforms or civilian clothes, as their activities became more covert andclandestine, like the Gestapo. When working in plain clothes, kempeitaiofficers identified themselves by wearing an imperial chrysanthemum on theunderside of their lapels. 65 They spawned a huge network of spies,informants, and terrorists, totally pervasive inside Japan and countries itoccupied. 66 At the height of World War II there would be just under 35,000men formally in the kempeitai, deployed throughout the Japanese Empire. 67Their informal number was much greater because of the many thousands ofinformants at all levels of society, and the close integration of the kempeitaiwith Black Dragon and Black Ocean, like teeth and lips. 68 The mainkempeitai schools were in Tokyo and Seoul. Others were set up later in

Singapore and Manila. Training included espionage, explosives, fifth-columnorganization, code-breaking, burglary, disguise, and torture. Foreign


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language study was downplayed, so in the field kempeitai officers usedinterpreters. 69 A British professor studying Japanese police methods in thelate 1920s noted that torture was routinely used because of the officialconviction that no Oriental can be expected to tell the truth except undertorture. The most common forms of torture are: suspending the body from a

beam by a cord tied to the middle finger, the toes just touching the floor ....Aseverer form is to tie the hands behind the back and then let the body hang bythe hands from the beam, which almost disjoints the shoulder blades.Another way is to enclose the body in a box that presses in tightly on all sides,and then pour water on the face until the verge of suffocation is reached; alsotouching the body repeatedly with red hot irons. 70Koreans did not accept annexation with resignation, so there was much workfor the kempeitai. Protest was intense, armed, and involved thousands. In1912, 50,000 Koreans were arrested by the Japanese, in 1918 the numberrose to 140,000.71 During Koreas first ten years as a Japanese colony evenJapanese school teachers wore uniforms and carried swords.72 Black-coated

policemen helped bring in the harvest, closely supervising rice productionfrom paddy field to storehouse, so the majority could be sent by ship toJapan.73The kempeitai in Korea was notorious for dragooning women into sexualslavery as comfort women. Since prisoners of war were the responsibility ofthe kempeitai, they recruited Korean yakuza to serve as prison camp guards,and encouraged them to be extremely vicious. 74Once in absolute control of Korea, the Japanese army and kempeitai providedTerauchi with all the brute force necessary for seizure of property. Usuallysoldiers were not needed because the terror applied by the kempeitai andBlack Ocean paramilitaries was sufficient. Like Yamagata, Terauchi used

these underworld zealots as a strike force. patriots. In Japan, Black Oceanfinanced itself by intimidation and extortion, kidnaping and murder, restrainedonly by prudence in its selection of victims. On the Asian mainland there wasno need for such restraint. Although some Japanese officers exercised acertain amount of restraint, showed some mercy, and refused to indulge inwanton killing, Terauchi let it be known that he expected no mercy. Because itwas the style set by Terauchi, many Japanese bankers and businessmenexhibited the same contempt for mercy. So overzealous patriotism was usedto justify the intense collaboration of bankers, businessmen, soldiers andgangsters in looting and extortion that stripped Korea of everything fromartworks to root vegetables.Once Korea was enslaved as Japans colony, the transfer of culturalproperty was not seen by Japanese as theft. How can you steal somethingthat already belongs to you? And everything in Korea now belonged to Japan.Foremost on Japans cultural wish-list was Koreas famous celadon porcelain,regarded by many as the finest in the world, surpassing even Chinas Hanand Tang porcelain. Korean celadon stoneware was distinctive for itstranslucent blue-green glaze inlaid with black and white floral designs. Thesedesigns were incised into the clay and filled with color before glazing. AWestern expert called it the most gracious and unaffected pottery evermade. 7576 Although Japan had kidnaped Korean artisans in the sixteenth

century, and they discovered adequate sources of clay at sites in Kyushu, theoriginal Korean celadon was valued above all others, particularly for


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ceremonial purposes. 7778 Tiny Korean celadon bowls were especially prizedfor use in Japanese tea ceremony. Coveted also by collectors were examplesof Koreaspunchongstoneware, and Choson white porcelain. 79It was not enough to confiscate private collections. Japanese experts whohad been studying Korean court records and ancient manuscripts determined

that the most desired celadons were those of the greatest antiquity, only to befound in the tombs of Korean kings. To disguise the looting of these tombs,the Terauchi administration introduced new laws for the preservation ofKoreas historic sites, and proceeded to open some two thousand tombs,including the royal tomb of a king in Kaesong, from which they removedceladons, Buddhist images, gilt bronze crowns, necklaces, earrings, bronzemirrors, and other ornamental treasures. Along the Taedong River nearPyongyang in the north, 1,400 tombs were opened and looted. 80Scholars list more than 42,000 cultural relics, including ancient manuscripts,that were taken to Japan for study, and never returned. Some of these wereput on display at the Ueno Museum in Tokyo, where at least they could be

admired. But most ended up in private Japanese collections where they werenever put on public view, and only rarely were seen in private. Japanesecollectors keep most of their treasures in vaults, and only take them out fromtime to time for their personal viewing, so most of Koreas stolen antiquities ineffect are lost from site permanently.The wholesale removal of art treasures from Korea was overseen by no lessthan the governor-general himself, Terauchi, aided by Japanese privatecollectors and antique dealers who carried off not only art works but classicliterary texts and important national archives in the name of academicresearch at Japanese museums and universities. 81One of Terauchis first acts was to completely destroy the 4,000-room

Kyungbok-goong Palace to make way for the construction of a new residencefor himself. To decorate his new home, he selected 600 art works from out ofthousands being prepared for shipment to Japan, and put them on display inhis own personal quarters.

Tens of thousands of the finest books listed as national treasures,including all 1,800 volumes of the Ri dynasty archives, were shipped toJapan. Some scholars state that as many as 200,000 volumes of ancientbooks of lesser distinction were burned by the Japanese, as part of adeliberate program to completely erase Koreas distinctive culture. 82 Evenbefore the country was fully annexed, in 1907 the Japanese forced KingKojong to abdicate in favor of his ten-year-old son who was mentallyretarded.83 The Japanese styled him as Crown Prince Imperial Yi Un andsent him off to Tokyo. They claimed this was to educate the crown princeside-by-side with Meijis grandsons -- Princes Hirohito, Chichibu andTakamatsu. In truth, the boy was little more than a hostage, whos well-beingdepended on continued cooperation by the remaining members of Koreasroyal family. For some reason, Emperor Meiji found the boy sympathetic andlavished attention and gifts on him, showing the sort of affection he neverdemonstrated toward his own grandsons. The boy was easily persuaded tosign away his claim to the Korean throne. Eventually Prince Yi was married toPrincess Masako, once front-runner to become Hirohitos bride.84 The couple

survived the Pacific War and lived in wealth and security until their deathsyears later.


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All Koreans were to be stripped of their national identity and made-over intosecond-class Japanese. They were divested of their land, had their nameschanged to Japanese names, and were obliged to adopt Shinto in place oftheir own Buddhist, Confucian or Christian beliefs. The emperor of Japanwould be their only god, and any Korean who refused to acknowledge his

divinity would be arrested. Their temples were ransacked, including stealingthe ancient bronze temple bells and Buddhist statuary. Eventually evenordinary religious metalwork was removed and melted down for weapons asspiritual cooperation behind the guns. 85 Koreans were to speak onlyJapanese, Korean-language newspapers were shut down, political partiesdisbanded, Korean writers could only publish in Japanese, and all schoolswould teach only in Japanese.86Even in the home, Koreans were expected tospeak only Japanese to each other.Kim So Un, a leading Japanologist in Korea, observed that throughout itshistory Japan had always been a taker and never a giver. 87Japans aim, said Korean historian Yi Kibeck, was to eradicate

consciousness of Korean national identity, roots and all, and thus to obliteratethe very existence of the Korean people from the face of the earth. 88Before they were through, the Japanese used dynamite to blow up amonument to King Taejo (1396-1398), and another monument to Sam-yong,the militant Buddhist priest who led the resistance Japans invasion of Koreain 1592. 89Over subsequent decades, thousands of other Korean cultural artifacts wereforcibly removed from Korea by Japan, and never returned despite Japanspromises. In 1965, the South Korean government demanded the restitution of4,479 items that it was able to identify individually. Of those, Japan grudginglyreturned only 1,432, taking another thirty years to do it.

While some of Koreas elite saved themselves and their families bycollaborating with the Japanese and profited richly most big land ownerswere stripped of their traditional estates and agricultural properties, whichwere snapped up by Japanese developers. One of Japans biggestdevelopers acquired over 300,000 acres in Korea, on which he intended tosettle Japanese immigrants.A Japanese antique dealer named Nakada amassed a fortune over the nextforty years by specializing in the looting and export of ancient Koryo celadons.90 He dealt with a Korean collaborator, a former high official of the Ri dynasty,who also became a millionaire.91Fortunately, some rich Koreans managed to acquire whole lots of antiquitiesfrom Japanese dealers before they could leave the country. They paid hugelyinflated prices, but in this way they preserved some of Koreas patrimony andperhaps made amends to their countrymen. The most famous of these wasmillionaire Seoul property owner Chon Hyong-pil (1906-1966) who eventuallybuilt the Kansong Art Museum to house his collection, the first privatemuseum in Korea. Among his other acquisitions, Chon managed in 1937 tobuy a major collection of Koryo celadons from John Gadsby, a British attorneyliving in Tokyo who saw the Pacific War coming and realized that theJapanese government would never let him take his collection back to Britain.92

But few Koreans were so fortunate. Tenant farmers who lost their land, andlandless urban poor, were rounded up as slave labor and shipped off to work


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in Japanese mines and construction brigades, in Japan and later in the KurileIslands to the north. Sixty thousand Koreans were forced to toil in coal minesand military factories in Sakhalin. Of these, 43,000 were still in Sakhalin atthe end of the war, when they came under Soviet control, and hadextraordinary difficulty getting home.

Altogether, it is believed that as many as six million Koreans were forced intoslave labor battalions by the Japanese prior to 1945. Almost one million ofthese were sent to Japan. As Japan overran Southeast Asia, the others weresent to the Philippines and the Dutch East Indies, to do construction work forthe Japanese army and navy, and to dig tunnels and bunkers for Golden Lily,with tragic consequences for most of them. One group of 5,000 Korean slavelaborers who were taken to Japans Aomori Prefecture to dig a majorunderground complex for the storage of war loot, were put aboard theJapanese warship Ukishimaon August 24, 1945. Japanese officials told themthey were being taken home to Korea. The Koreans were put into the shipscargo holds, which were then sealed. When they were miles off-shore, the

Japanese crew opened the Kingston valve to flood the ship, and escaped inlifeboats, leaving the Koreans to drown. Out of 5,000 only 62 survived.93Tens of thousands of young Koreans were conscripted into the Japanesearmy, and sent off to serve as cannon-fodder in military campaigns far to thesouth (many ending up in Burma or New Guinea).Saddest of all were the many thousands of young Korean girls duped intogoing to Japan for employment, instead ending up in brothels. It was in Koreawhere the kempeitei set-up its first official brothels, in 1904. These were filledwith kidnaped women and girls, the hapless forerunners of the hundreds ofthousands of Korean women later forced to serve as Comfort Women in armybrothels all over Asia. Koreans were targeted because it was believed that if

Japanese women and girls were forced into prostitution for the army, soldierswould mutiny.94 Most of Japans soldiers were poor farm boys. During the1930s, poverty and famine in Japans countryside caused farm families to selltheir daughters, who ended up in sexual slavery. Some 200,000 girls weresold into slavery in Japan each year during that decade. This caused serioustrouble in army ranks when their brothers heard appalling stories, but wereprevented from doing anything. So the Japanese Army took pains tocharacterize Korean women and girls as mere livestock. Mercy was in shortsupply.Japanese industry did move into Korea, and to some extent did modernize thecountry, but at terrible cost. It was bare bones, and Korean workers werepaid one-fourth the wages of their Japanese counterparts in the samefactories.95 Terauchi saw to it that Koreans ate millet, and their rice went toJapan.When people are so thoroughly terrorized and plundered, it is impossible tocome forward later with a precise list of what was stolen, or a stack ofreceipts. Historian Bruce Cumings sums it up: millions of people used andabused by the Japanese cannot get records on what they know to havehappened to them, and thousands of Koreans who worked with the Japanesehave simply erased that history as if it had never happened.96It did not have to be that way. In sharp contrast to the bitter experience of

Korea, the story of Taiwan under the Japanese was remarkably mellow.Taiwan was one of the concessions wrested from the Chinese in 1895. None


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of the Western powers could come up with any good reason why Japanshould not be allowed to keep the big island. It had always been neglected byChina. Taiwan was never an independent nation, although the attempt wasmade in 1661 when a half-Chinese, half-Japanese merchant warlord calledCoxinga took it away from Dutch traders and set up his own domain as a base

to raid the mainland. Unluckily, Coxinga made his headquarters at a place theDutch had called Fort Zeelandia, near present-day Tainan, which was amosquito-infested swamp. One year later at age thirty-eight, Coxinga camedown with dreaded cerebral malaria and died in agony, bringing his rebelkingdom to an abrupt end. His romantic legend was as popular in Japan as itwas in China, so Japanese had a positive image of the island as an unspoiledparadise where they could do pretty much what they pleased.Chinas Manchu regime had only a minimal administration on Taiwan, whichwas despised by native Taiwanese. So there was little resistance to Japansarrival, and what resistance there was came mostly from aborigines in thehigh mountains, who were easily suppressed. Unlike Koreans, Taiwanese had

no ancient loathing of Japan, and no history of war. Most important, they hadnothing to steal -- no rich cultural patrimony built up over thousands of years,no magnificent artistic heritage, no traditional hierarchy to destroy, and fewtombs to loot.In their eagerness to turn what they called Formosa into a money-makingventure, the Japanese actually made life on the island a great deal better thanever before. Taiwan did get saddled with the same ubiquitous police systemand Gestapo, but there was no core of anti-Japanese radicals or intellectualsto fan dissent, or to lead resistance. Having been treated like dirt by theManchu, Taiwanese expected little better from the Japanese., and were notdisappointed.

Police were the backbone of Japans colonial administration. In addition topolicing, they supervised the collection of taxes, enforced health andsanitation, and controlled trade in salt, camphor and opium monopolies.Along with the army and police came Japanese carpetbaggers andbusinessmen, who were looking for local Overseas Chinese partners, to setup morphine and heroin processing laboratories, to flood Chinas mainland.Commercially, the collaboration between Japanese and Taiwanese madeboth happy.Japan rationalized Taiwans agriculture, established a strong and efficientgovernment, and imposed strict public order.97 Conscript labor was notrequired of Taiwanese until the 1940s, when thousands of them were sent offas slave laborers to the Philippines.98During the 1930s, Taiwan became one of Japans most important stagingbases for the Strike South in December 1941. Huge amounts of money andmanpower were invested to create a permanent military platform on theisland. The First Air Fleet made its headquarters in a big undergroundcomplex inside Kookayama mountain, with spacious quarters for nearly 1,000men.99 (It was from bases on Taiwan that Japanese bombers took off todestroy Americas air force on the ground at Clark Air Base in the Philippines.)Many Taiwanese look back on their period as a Japanese colony as the goodold days. Those old enough to have lived first under the Japanese and then

under the KMT administration of Generalissimo Chiang Kai-shek, discoveredto their horror that the good old days ended when Chiang fled to Taiwan


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from the mainland in 1949, bringing in his wake hundreds of thousands ofmainland Chinese.

Taiwans mellow experience of Japanese rule was unique -- the oneexception in half a century of extraordinary violence. Koreas destruction andplunder were to be the norm, as Manchuria and China were about to discover.

1.The note to Foreign Minister Herbert Morrison was found by ABCIFER inBritish FO Record 92591 p. 4. Our thanks to ABCIFER officers Keith Martinand TK Their findings can be located on the internet atwww.abcifer.com/ww2/newpage1.htm. ABCIFER got in touch with ourpublishers to share their findings after reading YAMATO DYNASTY.

2. We were given information on Navarone by people who know the site welland have opened one of the entrances that was re-sealed in the 1990s.

3.

American diplomat Horace Allen advised the Department of State that onhis way to an audience in the morning he observed thirty evil-lookingJapanese with disordered clothes, long swords, and sword canes runningaway from the palace. National Archives, Dispatch Book, U.S. Legation inSeoul, Allen to Olney, Oct. 10, 1895.4.The doomed household minister was Yi Kyong-sik. Duus, The Abacus andthe Sword, p1115.General Dyes statement and the Japanese gloss are both from Duus, opcit., pp111-112.6.For details of the murder in English see George Lensen, Korea andManchuria between Russia and China. p.92. Also Duus. For a detailed

Korean study of the plot,see Pak Jong-keun, Nisshin senso to Chosen,pp255-267.For the broad background, see our earlier study of these events inDragon Lady, Chapter 10.7.Puppet regent was the Taewongun, an aging Confucian who agreed to beJapans front man.8Queen Mins murder ws witnessed by American and Russian advisers. SeeCumings, KOREAS PLACE IN THE SUN, p. 1219These thugs were called the hullyondae,10.Adachi Kenzos Black Ocean ties are from Roberts, Mitsui, p268 and Duus,p111. As Roberts makes clear, Mitsui and other top Japanese corporationsoften employed agents in the field who were tied to secret societies and could

easily arrange a little mayhem.11.This role of the secret societies is described in Ronald Seth, SecretServants a history of Japanese espionage.(1957) See also MichaelMontgomery, David E. Kaplan, Robert Whiting.12Many Black Ocean agents were waggering professional bullies called soshi.13.The composition of the assassins is from Duus, p11114.Here I use the probably accurate high-end estimate of dead cited byhistorian Bruce Cumings, Parallax Visions, P4415Itami had first hand experience of the underworld when he was attacked bythugs and had his face slashed. Source JPRI paper get details.16.See Ian Burumas excellent Behind the Mask for a general appraisal of theoutlaws role as one of the four pillars of Japans power structure.


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17. Korea always had (in the words of historian Bruce Cumings) a severeanti-Japanese allergy.

18.Korean roots for Japans kings... Cumings, KPIS, p31 n1919.

Of the three ancient Korean kingdoms, Pakche may have had thestrongest cultural influence on Japan. Its distinctive mural art has been foundon the walls of royal tombs in Japan. Cumings, KPIS. P332021.Cumings, KPIS. Pp36-3722. Movable type: Cumings KPIS p64/p6523.Most advanced ~ Bruce Cumings, KPITS, pp 33-39.24.Cumings, KPIS, p.3925. Cumings, KPIS, p40.26. From evidence found in several of Japans royal tombs, many Korean andWestern scholars conclude that these early rulers had Korean roots.

Japanese deny this, yet they seem reluctant to open other tombs. Cumingsconcludes that neither the Japanese nor the Koreans were ethnically unique,coming from the same ancient root stock. Cumings, KPIS. p31.27.Paranoid foreign policy is from Duus, p16.28.Erasing their culture ~ Bruce Cumings, KPITS, pp. 31-41.29.Turtle ship. Cuming. KPIS p7630.Hideyoshi. Cumings KPIS p77

31.One of Koreas most famous porcelain artists of the late 16 thcentury wasRi Samp-yong who was kidnapped by Hideyoshis culture squads and takento Japan. Ri, working for his kidnappers, would later find the right kind of

clays in Japan, starting Japans famous porcelain industry in Kyushu, wherethe famous Imari ware was fabricated.32 Japans looting and kidnaping porcelain artisans. Cumings, KPIS p7833.Japan like wild animals lacking morality, Cumings KPIS, p10134.Koreas uncommercial state. Cummings, KPIS pp81-8235. Koreas weakness in 1894. Cumings. KPIS pp92-9336.General Yamagata warned that once the trans-Siberian railway wascompleted, there would be great upheaval and Asias wealth and resourceswould be like a pile of meat among tigers. Duus, P64

37.The defeat of China by Britain during the Opium War was a profoundshock to the samurai elite who had long seen the country as a source ofculture and learning. Duus, p21

38.The modernization of Japan with new technology is what permitted theMeiji leaders to crush opposition within Japan, which then enabled them toproject Japanese power outward. Duus, p18

39. Japans new conscript army had first been created to suppress internalconspiracies and uprisings, but with those now under control the general staffnow turned their attention to a military and logistical buildup for conquest on

the Asian mainland, and possible war with China. Duus, P61


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40.With one sweep we can mobilize the manpower, the mineral resources,and the grain, and use them in Hokkaido. Duus, p3541. Ito remarked that two-thirds of the men in the Imperial Guard lean towardthe view that Korea should be subjugated. Brown and Hirota. Diary of Kido

Takayoshi. Cited in Duus p40 n2142.Peter Duus, Abacus & Sword, pp.22-23.43.Peking quote is from Duus, p50441884 coup by korean radicals. See S. Seagrave, DRAGON LADY, pp.177-7845Kim Ok-kiums assassination as the catalyst of the Sino-Japanese War1894-95. See Seagrave, DRAGON LADY, p. 17846.Tonghaks, see Duus P6647A precedent to be followed in later decades. See Roberts, MITSUI, p. 14848.The indemnity allowing Japan to go on the gold standard was $150-millionpaid in bullion. See Roberts, MITSUI, p. 148.

49.Putting Japan on equal terms with the international money-market. SeeTamaki, Norio. JAPANESE BANKING: A HISTORY, 1859-1959, p. xv. Seealso Checkland, Nishimura, Tamaki (editors). PACIFIC BANKING, 1859-1959:EAST MEETS WEST, Chapter One.50.Taiwan, Japans first colony. See Dower, EMBRACING DEFEAT, p. 21.51.Queen Min murder plots. Duus P10152. War was not actually declared until February 10, 1904. See roberts, MITSUI, p. 156Russo-JapaneseWar begins. Duus P18053Japans gains from the Russo-Sino War. See Roberts, MITSUI, p. 16254. The Japanese annexation... in 1910...[was] the result of two separate butinterlinked processes... The political process entailed the gradual extewnsion

of influence and control over the Korean state...; the econonomic processentailed the gradual penetration of the Korean market by an anonymous armyof Japanese traders, sojourners, and settlers. ... Duus p2355.Police state comes. Duus P18656.Ah, how wretched... Duus, p19557.Itos arrogant quote, Duus p19058.[Annexation, Duus p383]59.The text of the Treaty of Annexation is available on websiteisop.ucla.edu/eas/documents/kore1910.htm.60.Whip you with scorpions is quoted from Lowe, ORIGINS OF THEKOREAN WAR, p. 4.61.torture as a matter of course is quoted from Lowe. ORIGINS OF THEKOREAN WAR, p. 10.62.The elimination of all anti-Japanese activities and activists is fromKODANSHA ENCYCLOPEDIA OF JAPAN, Volume 8, p. 1263Black Dragon approval of kempeitai. See Lamont-Brown, p. 7464.The kempeitais bright uniforms were described by Phyllis Argall who grewup with her missionary parents in Japan and saw them in their pre-World WarII colors. See Lamont-Brown, KEMPEITAI, p. 34.65Kempeitai plain clothes men with a chrysantemum pin hidden under theirjacket lapels. See amont-Brown, KEMPEITAI, p. 3466.

The kempeitai became omnipresent is quoted from Lamont-Brown,KEMPEITAI, p. 17.


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6735,000 kempeitai at the height of the Pacific War. See Lamont-Brown,KEMPEITAI, p. 3468.The linkage between the Black Ocean Society and the kempeitai, seeLamont-Brown, KEMPEITAI, p. 24.69

Kempeitai schools, curriculum. See Forty, JAPANESE ARMY HANDBOOK,p. 23670Professor Bryans report on Japanese police torture methods is quoted inLamont-Brown, KEMPEITAI, p. 19. The study was originally published in1928.71Arrests of Koreans in 1912, and 1918. See Cumings, KOREAS PLACE INTHE SUN, p. 14772School teachers uniformed and carrying swords. See Cumings, KOREASPLACE IN THE SUN, p. 15273The rice police as described by Cumings, KOREAS PLACE IN THE SUN,p. 152

74Many POWs have only the bitterest feelings for the Korean guards. In aphenomen that has been well-documented in the case of kapo guards at theNazi concentration camps, the Koreans being at the bottom of the Japanesemilitary pecking order often outdid the Japanese themselves in gratuitous actsof brutality toward the prisoners in their charge.75.William B. Honey, The Ceramic Art of China and Other Countries of the FarEast, p.167,quoted in Cumings KPIS, p.4276.Oddly, one Korean innovation not adopted in Japan is the ondolfloor, inwhich ducts in the tile floor carry hot air from a small central charcoal hearth,also used for cooking. Despite bitter cold winters, families slept cosily.Cumings, KPIS, p36.77.All about celadon. Cumings, KPIS, p42.78.One master taken hostage in the Porcelain War of 1598, Yi Sam-pyong,later discovered the first clay deposits in Japan that were suitable for makingporcelain, and established Japans first porcelain industry in the Arita regionon the island of Kyushu. His kilns produced magnificent blue-and-whiteglazed Imari Ware patterned on Korean and Chinese styles.79.Tokyo Art Museum catalogue for an exhibition of 152 Korean treasures.80.KCNA, April 27, 2000, quoting the Ministry of Culture.81.Spoils of War, Jongsok Kim, City University, London.82.KCNA, April 27, 200083For the story about Prince Yi of Korea (aka Sunjong) see Cumings,KOREAS PLACE IN THE SUN, p. 145 and Bix, HIROHITO, 34-35.84.Korea Under Japan, Carpenter Collection, Library of Congress. The wifeprovided was Princess Masako, one-time a bride-candidate to Hirohito andcousin to Princess Chichibu, wife of Hirohitos brother. See Seagrave, THEYAMATO DYNATY, pp. 92-94, p. 332.85.Spoils of War86.Op Cit, Carpenter Collection.87Kim So Un is quoted in Kim Yong-mok, Whither Japan-Korea Relations?JPRI Critique volume 5 Number 9, October 1998.88.Op Cit, Carpenter Collection.89.

Spoils of War90.KCNA, April 27, 2000


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91.20. Yang Sung-jin in the Korea Times. October 21, 1998.92.93The sinking of the Ukishima. See THE KOREA TIMES Japan AllegedlySunk Ship Carrying 5,000 Koreans, Seoul, 15 October 1999. Online at

NAPSNet Daily Report, Friday, October 15, 1999.94Why Japanese non-prfoessional women were not forced to become sexslaves. See Korean Military Comfort Women on the web at GET ADDRESSTK this is [email protected]/Japanese wage disparaties in Japanese enterprises located inKorea. See Cumings, KOREAS PLACE IN THE SUN, pp. 168-16996The vanished records of the Japanese-Korean interlude. See Cumings,KOREAS PLACE IN THE SUN, p. 13997Japans success story in Taiwan. See Cumings, PARALLAX VISIONS, p.77-8298No conscript labor on Taiwan. See Cumings, PARALLAX, p. 84

99Description of the First Air Fleet headquarters in Kookayama mountain. SeeKodama, I WAS DEFEATED, pp. 144-145

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