Treacherous Passage: Germany's Secret Plot against the United States in Mexico during World War I

Treacherous Passage: Germany's Secret Plot against the United States in Mexico during World War I

by Bill Mills


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Treacherous Passage: Germany's Secret Plot against the United States in Mexico during World War I by Bill Mills

While the Great War raged across the trench-lined battlefields of Europe, a hidden conflict took place in the distant hinterlands of the turbulent Mexican Republic. German officials and secret-service operatives plotted to bring war to the United States through an array of schemes and strategies, from training a German-Mexican army for a cross-border invasion, to dispatching saboteurs to disrupt American industry, and planning for submarine bases on the western coast of Mexico.

Bill Mills tells the true story of the most audacious of these operations: the German plot to launch clandestine sea raiders from the Mexican port of Mazatlán to disrupt Allied merchant shipping in the Pacific. The scheme led to a desperate struggle between German and American secret agents in Mexico. German consul Fritz Unger, the director of a powerful trading house, plotted to obtain a salvaged Mexican gunboat to supply U-boats operating off Mexico and to seize a hapless tramp schooner to help hunt Allied merchantmen.

Unger’s efforts were opposed by a colorful array of individuals, including a trusted member of the German secret service in Mexico who was also the top American spy, the U.S. State Department’s senior officer in Mazatlán, the hard-charging commander of a navy gunboat, and a draft-dodging American informant in the enemy camp. Full of drama and intrigue, Treacherous Passage is the first complete account of the daring German attempts to raid Allied shipping from Mexico in 1918.

Product Details

ISBN-13: 9781612348544
Publisher: Potomac Books
Publication date: 01/01/2017
Pages: 256
Sales rank: 968,568
Product dimensions: 6.30(w) x 9.00(h) x 1.10(d)

About the Author

Bill Mills is an espionage writer and historian. He is the author of The League: The True Story of Average Americans on the Hunt for World War I Spies.

Read an Excerpt

Treacherous Passage

Germany's Secret Plot against the United States in Mexico during World War I

By Bill Mills


Copyright © 2017 William B. Mills
All rights reserved.
ISBN: 978-1-61234-873-5


A Simple Business Transaction

The harbor at Mazatlán was one of the busiest in the country in 1917. Even with a reduction in trade due to the war in Europe, Mazatlán remained the principal port of entry on the west coast of Mexico and business was still good enough to keep the dock workers busy from morning until dusk. The average depth in the harbor was only eighty feet, so arriving steamships were required to anchor offshore where they awaited an unusual offloading ritual.

When the tide was out, passengers disembarked from the steamers into gasoline-powered launches, which took them to rowboats that beached onshore. The first passengers from each rowboat that landed were carried on the backs of "boteros," or boatmen, until the rowboat could be fully dragged out of the water to enable the remainder to exit. Their luggage came onshore the same way. Meanwhile, a fleet of launches, rowboats, and lighters would descend upon the steamship. Stevedores climbed on board, followed by launch hands, who would bid against one another for the chance to carry the remaining trunks and baggage ashore.

Over $5 million worth of commercial goods were exported from Mazatlán each year, primarily hides, gold and silver ore, chickpeas, and sugar, and a somewhat lesser amount was imported. At high tide, freight was loaded and offloaded at a small wharf using lighters, but when the tide was low, every item that arrived or departed was carried on the back of a man. Outgoing crates were transported from the customs house by a "cargador," or porter, who carried it on his head and shoulders, wading across 100 to 200 feet of water before depositing it in a waiting lighter that transported it to the steamship. The boxes could weigh anywhere from 150 to 350 pounds. Imports were handled the same way. A seemingly endless line of cargadors fueled the system in each direction, carrying up to 1,000 tons of freight in the course of a ten-hour working day. At one point, gas-powered hoists had been mounted onto the wharf to allow the freight to be handled more expeditiously, but the hoists were not well-received by the cargadors, who responded by going on strike. They were quickly removed and man-powered transport was resumed.

The customs house was the focal point of the bustling activity in the harbor. It was a large, single-story structure built in the Spanish style, featuring a colonnade of arched columns in tropical white that formed a portico along one side, and was adjoined by an equally substantial warehouse where goods were held pending the payment of tariff charges. Whether import or export, each item of freight had to first pass through the customs house for appraisal and payment of duties.

It was here in August 1917, that Señor Miranda, the administrator of the Mazatlán dockyard, presided over a most unusual gathering. The revolution had drawn closer to an end that year with the approval of a new constitution and the election of Venustiano Carranza as president of Mexico. Although the country would remain a chaotic and troubled land for years, a level of stability had returned with the establishment of Carranza's government. One of the first orders of business for the new administration was to increase federal revenues, and in the shipwrecks of the recent revolution — such as that of the gunboat Morelos in Mazatlán harbor — the Ministry of Finance and Public Credit saw an immediate source of hard cash.

Before it was sunk by the Constitutionalists, the Morelos had been the finest warship in the Mexican navy. Launched at the Sestri Ponente shipyard near Genoa, Italy, in 1905, the Morelos was a classic example of modern naval design. Its armored hull was 250 feet long, with a beam 34 feet wide. Powered by two sets of threecylinder engines of 2,600 horsepower, with steam supplied by two Blechynden water tube boilers, the gunboat had a top speed of 17 knots (19.6 mph). The capacity of its coal bunker was sufficient to provide a range of 5,000 miles at 10 knots. The ship had quarters for 26 officers and 90 crewmen, and could provide living space for an additional 260 troops. At the time it was built, it had been armed with two 4-inch rapid-fire guns and four 2¼-inch cannons. Although these armaments had been stripped from the wreck years before for the rebel army, the electric ammunition hoists remained on board. As scrap, the value of the Morelos was significant — likely measured in tens of thousands of pesos to the treasury. Its three-bladed propellers alone, made of manganese bronze and 8 feet in diameter, would be worth a tidy sum.

The Finance Ministry dutifully placed advertisements in the Official Journal and newspapers throughout the region, announcing that the wreck of the former navy gunboat Morelos would be sold at public auction at the customs house in Mazatlán on August 14, 1917. All parties interested in bidding at the auction would be required to deposit a 15,000 peso ($8,000) bond in advance at the customs house.

On the day of the auction, Señor Miranda, the dockyard administrator, surveyed the small group of bidders standing before him. There were no bankers in fancy suits in attendance — the men wore work pants, boots, and shirtsleeves. A few puffed on cigars. Most were scrap metal buyers from the Sinaloa area, or men like Blendes, the American who operated between San Francisco and Mazatlán in search of promising scrap opportunities. They were tough, hardnosed businessmen who had already estimated the cost of refloating the wreck, towing it to one of the large west coast ship-breaking yards, and trucking the scrap to the nearest steelworks. With America's entry into the war in Europe, a manufacturing boom was under way that had sent the price for scrap iron and steel soaring. As a result, the bidding for the Morelos was expected to be intense.

Señor Miranda started the bidding at 1,000 pesos and it rose rapidly from there. 4,000–5,000–6,000 pesos ... The bids came in quick succession, with hand signals flashing throughout the crowd — 7,000–8,000–9,000 pesos ... When the bidding reached the 12,000 peso mark, the speed of the offers slowed as the scrap men paused to tabulate the rising cost of the wreck against its fixed return. At 15,000 pesos, most of the bidders in the audience had become spectators. The final bid of 35,000 pesos ($18,550) released an undercurrent of murmurs throughout the crowd. That was a lot of money to pay for a sunken wreck — the scrap margin would be exceedingly thin. Heads turned to catch a glimpse of the winning bidder.

The victor was Cornelius Adolph Heintz — to those who knew him, probably the man least expected to win the auction. Heintz had a well-deserved reputation for unscrupulous business dealings and a propensity for passing worthless checks. Even more surprising to the authorities running the auction was the name of the party that had backed Heintz by putting up his $8,000 bond — the powerful German trading house of Melchers Sucesores.

Cornelius Heintz was a twenty-eight-year-old engineer from Los Angeles. The son of a German father and an American mother, he had departed the United States for Mexico on April 1, 1917, the day before President Woodrow Wilson asked a joint session of Congress to declare war on Germany. In the vernacular of the day, Heintz was a "slacker," a draft dodger who had deserted his country to sit out the war in Mexico. Considered traitors in the United States and unmanly cowards in Mexico, slackers were universally despised on either side of the border.

The San Bernardino News described the slacker community in Mazatlán in an article published in 1918 as "outcasts from home and country ... half-starved and utterly hopeless ... The Southern Pacific railroad refuses to give employment to a man who has fled his country to escape military service. The Mexicans despise the American slackers and have little or no work to give to them."

Heintz's stated purpose in traveling to Mexico was to fulfill the terms of an employment contract that he'd accepted to inspect a derelict gas schooner called the Anvil that was anchored in the harbor at Guaymas. He held a degree in mechanical engineering from the Throop Institute — later renamed CalTech — and had some experience in marine engineering. After assessing the schooner's condition and providing recommendations for its repair, Heintz was hired by the ship's owner, a German named Bernard Hilbing, to return the Anvil to seaworthy condition. Heintz's association with Hilbing would lead the young engineer into involvement in a succession of German intrigues.

At one time Hilbing had been the manager of the Foreign and Central American Department at Parrott and Company, a private banking firm, where he became highly knowledgeable regarding the import–export business and fluent in Spanish and English. Most of his time with Parrott had been spent trading in coffee with firms in Central America, including the mercantile trading houses of Mazatlán. Hilbing's professional career took a turn for the worse in 1914, when he had been caught embezzling $2,000 from his employer and was summarily dismissed. He then took a position with the Western Equipment Company, engaged in the import and export of steel products, from which he also departed under a cloud of suspicion, this time related to a heavily padded expense account. In 1916, Hilbing branched out into a new export field — supplying munitions to Mexican revolutionists. U.S. authorities suspected Hilbing of shipping arms and ammunition to Esteban Cantú, the governor-general of Lower California, via Pacific coastal steamer for transshipment to the army of Pancho Villa, by then, a sworn enemy of the United States.

Heintz worked at overhauling Hilbing's schooner throughout the summer of 1917, until it was ready for sea. He was then offered a six-month position as chief engineer of the Anvil at $240 per month, but this opportunity vanished when Heintz learned that his employer had been taken into custody by American immigration authorities.

Hilbing had sailed the reconditioned Anvil to Los Angeles (LA), where he planned to pick up a former employee of the Krupp munitions works named Place and proceed with an "unspecified cargo" to Salina Cruz, Mexico. Upon arrival in LA, however, he was seized by U.S. Immigration officials for falsely stating his nationality as "USA" on the crew manifest. In October 1917 Hilbing's detention became permanent when a presidential warrant was issued declaring him to be a German alien enemy "whose presence at large is a danger to the public peace and safety of the United States." Hilbing became War Prisoner No. 596, and was interned for the next two years at Fort Douglas, Utah.

With his employer in jail, Heintz had lingered in Guaymas for three weeks, and then departed for Mazatlán in search of new employment. Hilbing had been on a first-name basis with the senior managers of all the German mercantile houses in Mazatlán since his coffee trading days with Parrott and Company and had introduced many of these men to his associate, Cornelius Heintz. In Mazatlán, Heintz called on Herr Unger and Herr Haüs of the firm Melchers Sucesores, and in secret meetings proposed a plan to acquire the sunken gunboat Morelos.

The largest and most powerful of the foreign firms that controlled commercial trade in Mazatlán was Melchers Sucesores, or Melchers Sucs (pronounced Melchers Soos). From the company's headquarters and main warehouse on Arsenal Street, a fortress-like two-story cement structure with barred windows and heavy wooden doors, the managing partners of Melchers Sucs reigned over a trading empire.

Founded in 1846 by Heinrich Melchers of Bremen, Germany, Melchers Sucesores had been created to take advantage of the opportunity presented by Mazatlán's central geographic location, Mexico's substantial mineral and agricultural resources, and the local market's demand for manufactured goods from Europe. There were no railroads linking the cities of the Mexican interior with those of the west coast, and seaports like Mazatlán became key distribution points for the country. An endless flow of goods from Europe and America arrived in Mazatlán harbor to be transported to the warehouse of Melchers Sucesores, where they would then be purchased by area merchants and loaded onto mules for transport to inland shops. Melchers Sucs imported silks from France, linen from Ireland and Silesia, textiles from Austria and Germany, and wine from Spain, along with a wide variety of manufactured products, from firearms and ammunition, to plumbing supplies, sewing machines — and even Studebaker automobiles. In addition to retail goods, Melchers Sucs also distributed commercial machinery and supplies to satisfy the needs of domestic mining and industrial concerns.

The company's founders, and their descendants, had returned to Germany before the end of the nineteenth century, leaving operation of the firm in the hands of a succession of capable managing partners. In the succeeding years, Casa Melchers ("the house of Melchers") expanded beyond basic import/export activities into a variety of other business endeavors. The company became a broker of Brazilian rosewood, heavily in demand by European textile mills for color dye, and also established a plant to manufacture yarns and fabrics. They became shipping agents, and the primary exporter of gold and silver ores from over a dozen mines in western Mexico as well as agricultural produce from across the region. They acted as a manufacturer's representative for foreign companies seeking to penetrate the Mexican market, including the Santa Cruz Cement Company, Krupp steel, and the California Vinogrit Powder Company, a large producer of dynamite.

To support its trading activities, Melchers provided commercial credit on a wide scale. Mining and farming interests throughout western Mexico placed orders for equipment exclusively through Melchers Sucesores due to the generous credit terms that the company provided — typically six months before payment was due. Casa Melchers financial operations expanded significantly during the Mexican Revolution. State and national banks in Mexico had traditionally issued their own currency, which was not backed by silver or gold. During the revolutionary period, Carranza suspended bank charters to eliminate the financial instability that was being caused by the issuance of essentially worthless currency. To enable business to continue, banking operations shifted to the trading houses themselves. Melchers Sucs became a private banker, buying and selling notes, holding cash reserves, financing commercial transactions, and transferring funds between companies and foreign banks around the world. Casa Melchers even sold fire insurance policies in Mexico that were underwritten by European insurance companies.

For more than seventy years Casa Melchers prospered, overcoming every business, political, and societal challenge encountered, from outbreaks of bubonic plague and yellow fever, to the upheavals and violence of the revolution and the threat to their port-based market domination posed by the expansion of the Southern Pacific Railroad of Mexico into the region. To the company's good fortune, in 1909 the railroad stopped laying rails at Tepic instead of Guadalajara (as had been planned), ensuring that inland merchants would continue to rely on Melchers' well-stocked warehouses for their goods, instead of sourcing products from distant Manzanillo.

By the second decade of the twentieth century, Melchers Sucesores future looked as promising as its past. Then an event occurred that sent business into a tailspin — World War I broke out in Europe. The firm's channels of communication with the home office in Germany were immediately cut, which also terminated their ability to conduct financial transactions with companies in the various capitals of Europe. The English naval blockade of Germany eliminated any possibility of the German-owned company receiving goods from the mother country, or even Germany's enemies.

To make up for the loss of European imports, Casa Melchers increased purchases from America, but a second blow fell in 1917 when the United States declared war against Germany. Melchers' funds in American banks were confiscated by the U.S. government, and all conduits to American business partners were severed as well. To restrict Germany's ability to finance the war and eliminate the chance for German-owned businesses in neutral countries to build up financial credits and goods for use in postwar trade (which would remove the pressure that they might bring on the German government to end the war), on October 6, 1917, the Trading with the Enemy Act was passed by the U.S. Congress. The new law made it illegal:

for any person in the United States, except with license of the President granted to such person, or to the enemy, or ally of the enemy, as provided in this act, to trade or attempt to trade, either directly or indirectly, with, to, or from, or for, or on account of, or for the benefit of, any other person with knowledge or reasonable cause to believe that such other person is an enemy or ally of an enemy [of the United States], or is conducting or taking part in such trade, directly or indirectly, for, or on account of, or on behalf of, or for the benefit of, an enemy or ally of enemy.


Excerpted from Treacherous Passage by Bill Mills. Copyright © 2017 William B. Mills. Excerpted by permission of UNIVERSITY OF NEBRASKA PRESS.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

List of Illustrations


Prologue: "The Morelos Will Be Ours"

1. A Simple Business Transaction

2. "I Will Shoot You Down like a Dog!"

3. The Alexander Agassiz

4. For Honor and Fatherland

5. "She Is an Outlaw and a Dangerous Enemy"

6. "If You Want to Get the Best of Uncle Sam, Get Up before You Go to Bed"

7. "The Germans Are After You"

8. United States of America vs. Alexander Agassiz

9. Going For Broke




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