Reinhard Gehlen was one of the most capable intelligence officers in the Third Reich. As head of Fremde Heere Ost — Foreign Armies East, the Wehrmacht's Soviet intelligence branch — he had built an extensive network of sources, agents, and files on Red Army order of battle. By early 1945, he knew Germany was losing and began thinking about his next employer.

He buried his files in the Bavarian Alps and surrendered to American forces in May 1945 with a proposal. He would hand over everything — the files, the network, the expertise — in exchange for protection and the chance to rebuild the organisation under American auspices, targeted at the Soviets.

The Americans accepted.

The Organisation

What became known as the Gehlen Organisation — formally the Organisation Gehlen, run out of a compound in Pullach, Bavaria — began operations in 1946 under CIA sponsorship. It employed former Wehrmacht officers, former Abwehr (German military intelligence) officers, and former SS personnel. Some had committed war crimes. The Americans were aware of this and largely did not care.

The CIA funnelled approximately $200 million into the organisation between 1946 and 1956. Gehlen provided intelligence on Soviet capabilities, Eastern European resistance movements, and Soviet military deployments.

The Problem

The organisation's value was always complicated by its composition and provenance. Gehlen's networks had been built by the Nazi regime and many of his agents had worked under those auspices, meaning their loyalties and credibility were questionable. Soviet intelligence — which had extensively penetrated the Wehrmacht's Eastern intelligence apparatus during the war — was well positioned to manipulate or monitor Gehlen's network.

Subsequent analysis has suggested that the KGB fed disinformation through the Gehlen Organisation for years, and that some of Gehlen's most valued sources were Soviet double agents. The CIA received tainted intelligence; how tainted, and how much, remains classified.

The BND

In 1956, when West Germany became fully sovereign, the Gehlen Organisation was formally transferred to West German government control and renamed the Bundesnachrichtendienst — the BND, West Germany's foreign intelligence service. Gehlen served as its first director until 1968.

The BND, Germany's equivalent of the CIA, thus began as an American-funded organisation staffed by former Nazi intelligence officers. This is not a contested point. The German government has acknowledged it.

"I am convinced that if I had been able to tell the American Army... the full story of my relations with the Russians, they would have been horrified." — Reinhard Gehlen, Memoirs, 1972.

Verdict

CONFIRMED. The Gehlen Organisation's existence, CIA funding, and Nazi personnel are thoroughly documented through declassified CIA files, West German parliamentary investigations, and Gehlen's own memoir. The degree to which it was penetrated by Soviet intelligence remains classified.