German unification in 1990 marked the end of the German Democratic Republic (GDR). East joined with West Germany and the assets of the GDR's ruling Socialist Unity Party (SED) went into the hands of the privatization agency for eastern Germany, the so-called Treuhandanstalt.

But the SED leadership by no means kept all of its funds within German borders. For years now, the German government has been trying to track down this money. Shortly before reunification, the East German parliament or Volkskammer set up an independent commission called UKPV to review the assets of the parties and mass organizations of the GDR. UKPV now operates within the German interior ministry.

According to a UKPV spokesman, it is impossible to specify precisely just how much money has disappeared.

"Certainly, a great deal was moved and there will be a lot that will never be revealed," said the spokesman, who asked not to be named in line with German government policy.

The end of a lengthy battle

But the commission has had some success stories. Last month, the Federal Administrative Court in Leipzig ruled that Germany is entitled to the assets of the former GDR foreign trade company Novum, totalling €200 million ($265 million). The decision ended a legal battle lasting over a decade.

Novum was founded in 1951 to mediate the extraordinary foreign trade -- trade that wasn’t part of the planned economy -- between the GDR and Austria.

"Novum arbitrated business and got a commission for this," the UKPV spokesman said.

Following the fall of the Iron Curtain, Novum’s managing director and sole shareholder, Rudolfine Steindling transferred millions of Swiss francs out of Novum’s accounts in Switzerland to private persons without any economic basis.

"We are talking about a big black hole here," the UKPV spokesman said, adding that estimates lie at some €250 million. The Treuhandanstalt successor BvS has taken civil action in Switzerland to recover the money.

Steindling, otherwise known as "the red Fini" for her tight contacts to Austria’s Communist Party (KPÖ), had insisted Novum was not owned by the SED, but rather by the KPÖ.

Extracting money for the Stasi

In a separate case in Austria, Germany in April won a 10-year legal battle against the Austrian Schoellerbank. Prior to reunification, the East Berlin company FC Gerlach transferred close to €75 million to the account of the fictitious company Anstalt Fortintakt, registered in Liechtenstein.

But FC Gerlach was operating as a front. It was controlled by Alexander Schalck-Golodkowski, who ran the GDR's foreign trade and foreign exchange operations, but was also a special officer for the much-feared East German secret service Stasi.

Under Schalck-Golodkowski, the Stasi for decades procured hard currency through bogus companies abroad.

Schoellerbank initially refused to release the funds from the Fortintakt account. But following the ruling by Austria's Supreme Court, the bank has transferred the full amount plus interest, totalling €146.5 million.

"The purpose of the GDR's foreign organizations was to pretend to the West that you were working with real companies," Florian Kremslehner, the attorney representing the German government in the case, told Austrian media. "But in reality, the Stasi was behind it all."

Help for the eastern states

According to Germany's unity treaty, the SED assets are supposed to be used for non-profit purposes, as well as the economic restructuring of the new eastern German states. In November, for example, the federal government transferred €55 million in former SED funds to the Stiftung zur Aufarbeitung der SED-Diktatur, a foundation dedicated to researching the causes and impact of the SED dictatorship.

Parliamentarian Siegfried Scheffler, spokesman for the eastern German states in the lower house Bundestag, said other trails of SED funds also led to Hungary. Last year, he asked German Chancellor Gerhard Schröder to discuss this problem while he was visiting Budapest.

Although the Hungarian government had officially promised to work together with German authorities, the ministerial red tape, as well as bureaucracy on the part of the banks concerned constituted "hardly concealed delaying tactics," he said.

The situation has improved, however, since Schröder's visit in November 2003.

"There has been some movement now, but the research is still going on," Scheffler said. "We still don't know how much SED money was parked in Hungary."

The UKPV spokesman said countries have been "very cooperative" in supporting the German government's enquiries.

Still, the commission has its work cut out for it. Through bank transactions, for example, it finds leads and sends an auditor.

"But then it depends on how tight the evidence is," he said.