A stolen Luger, ICE, Swiss cops and Lawyers. Great story. Long but excellent!

[Norm357]

Source Registration required.

On the trail of the Luger
From a Swiss museum to Texas, investigators -- and one Austin attorney -- track a stolen 1898 pistol





By Patrick Beach

AMERICAN-STATESMAN STAFF

Saturday, May 28, 2005

The story you are about to read is true. Only a few names have been obscured to shield a confidential informant and a couple of guys in a kind of legal limbo.

In the small circle of antique gun collectors and enthusiasts, the self-loading Borchardt Luger Parabellum is regarded as a pivotal pistol in the evolution of modern weaponry, a model that set the standard for semiautomatics. The Borchardt Luger, serial No. 5, is the oldest prototype known to exist. It was used in field trials in 1898. It was mass-produced in 1900. Switzerland was the first country to use high-powered, self-loading pistols, and eventually more than 3 million copies were made until the weapon went out of production in the mid-1940s.

The weapon, then, is a prized piece of history -- in its own way, not unlike Sam Colt's repeating six-shot revolver. What Henry Ford's Model T did for cars, or, in the words of a federal investigator, "what the Mona Lisa did for art," the Borchardt Luger did for semiautomatic weapons.

For decades, the BL5 was kept in a museum in Switzerland. In early 1996 it was stolen and replaced with a crude fake. After the theft, the Waffenfabrik Museum closed and its collection was moved. Nobody but the thief knew the original was gone.

The Borchardt Luger went underground. For years.

Dateline: Austin, November 2002. In the law offices of McGinnis, Lochridge & Kilgore a block from the Capitol, longtime partner Gaylord Armstrong gets an e-mail from a colleague in Switzerland whose client is attempting to recover the purloined pistol. The Swiss lawyer is appealing to the Austin lawyer because investigators in Switzerland have a fax with the area code 512. It appears someone in Central Texas is proposing to broker a sale.

Swiss authorities didn't even know when the gun was stolen.

Armstrong grabs partner Brian Engel, in part because Engel knows guns. Engel says there's so little to go on that it'd be best to engage in "expectation management." Still, he starts running down leads. He soon concludes that this is a matter for law enforcement, not lawyers, and law enforcement with jurisdiction that doesn't stop at state lines.

The feds. Engel meets with John Machin and Robert Howard, two agents with U.S. Immigration and Customs Enforcement based in Austin. Howard, a senior intelligence analyst, uses cell phone records, e-mail, travel receipts and the like. Amazing how much data is out there if you know where to look. Down to the minute, Howard is able to reconstruct movement and the times of conversation. He knows who's talking to whom, and when. The only thing he doesn't know -- because the lines aren't tapped -- is what they're talking about.

In April 2002, the broker from Bulverde, west of New Braunfels, travels to Switzerland for a sit-down with the holder of the stolen goods. Name: Heinz Schlatter, son of Walter Schlatter, the onetime curator of the Waffenfabrik Museum.

Yup. Inside job. Schlatter the elder helped himself to an irreplaceable weapon, hid it in his basement for years and eventually gave it to Junior, who engages in communications with the Texas broker. This is the source of the telltale 512 fax sheet. On it is a grainy photo of the gun. The text suggests the sender might be interested in acquiring the piece depicted.

Through that spring and into the summer, the broker puts out feelers. The number of people with both the interest and the means to buy such a piece is small, insular, cliquish. Word gets around quickly. Junior and the buyer in Hillsborough, Calif., make a deal. The buyer lines up an exporter in Germany and an importer in Sacramento, Calif.

June 2002: The buyer -- whose name federal officials decline to reveal because the investigation is ongoing -- travels to Switzerland to close the deal: $60,000 is the price. He takes the gun, temporarily removes five pieces to lower its value and smuggles the pistol into Germany. The Luger is mixed with two other, cheaper weapons, and its value listed on Customs forms as $5,000.

August 2002: The Luger clears U.S. Customs. The buyer pays the importer and takes it home.

The buyer -- an expert gunsmith who's been on the History and Discovery channels -- starts going to gun shows, discreetly telling people he's got the BL5, showing them the five removed pieces as proof. One of those listening is a fellow collector who will become a confidential informant in the investigation: Mr. X. He's a little obsessive, a little curmudgeonly, a good note-taker. He has digital photos of the gun pieces the buyer was showing around.

Mr. X meets with the feds and they talk about how to get the weapon back. Howard is still pulling in e-mail and phone records domestic and abroad. When he has no firm data, he makes educated guesses. In the first weeks of the case, he constructs a scenario: how the Luger might have been stolen, how it might have been smuggled into the United States. The scenario will prove exactly right.

Machin -- a senior special agent, and a former University of Texas pitcher who played with Roger Clemens and later pitched for Philadelphia Phillies farm teams -- considers posing as a buyer in a sting. For various reasons, that scheme is abandoned.

Engel has put together the foundation of the investigation. His other, less glamorous job is to play travel agent for Mr. X. Federal investigators continue collecting names, dates, anything that will support a probable-cause affidavit for a warrant to search the buyer's home and business in California.

Another fear is that if the feds execute a search warrant and the gun isn't flushed out, it'll be gone forever. They get in place, ready to do things the way G-men do.

Then Machin gets an idea:

Why not appeal to the buyer's vanity? Asian gangs are a problem in that part of California, and sometimes the gangs settle disputes with a particular kind of sword, a samurai sword. Why not call the guy, tell him there's been a homicide possibly involving this kind of sword, and can Mr. Antiquities Weapon Expert please come down to the police station and positively identify it for the authorities?

The guy bites, comes down to the police station. Look, Machin says, we really want to ask you about the BL5.

You're not going to believe this -- I've got it in the trunk of my car, the guy says.

Machin thinks it shouldn't be this easy.

This is April 30, 2003.

The buyer likely was taking the BL5 to his shop to fabricate replicas. One of the collectors who helped the feds didn't like the buyer because the buyer had once sold him a fake.

Immigration and Custom Enforcement, a division of the Department of Homeland Security, gets a couple of independent experts to sign off on the Luger's authenticity. It's valued somewhere north of $700,000.

The buyer's story is that he thought he was making a legitimate purchase. The government files a forfeiture notice. The buyer fights and loses. The gun will go back to Bern.

The Swiss government is ecstatic, and the feds start working their way backward, from the buyer to the broker to the thief and his son. Machin goes to the broker's place in Bulverde, and there's Heinz Schlatter. The broker and the thief's son apparently are trying to get their story straight after the gun is recovered.

The return of the Borchardt Luger 5 is such a big deal that the weapon is repatriated in a formal ceremony at the American embassy in Bern. Many dignitaries and members of the law enforcement community from both sides of the Atlantic attend.

In January, Walter and Heinz Schlatter are convicted in Switzerland of theft and receiving stolen property, respectively. The elder Schlatter, it turns out, retired after 25 years at the museum and helped himself to a few things on his way out. The Waffenfabrik was closing and its collection being moved, anyway, so he likely expected the theft and switch to remain unknown indefinitely.

The Austin offices of McGinnis, Lochridge & Kilgore are on the 13th floor of an office building on Congress Avenue. In the conference room, the marble tabletop is long and the floor-to-ceiling windows offer a fine and full view of the Capitol, telegraphing the firm's proximity and access to power.

Earlier this month, partner Brian Engel is summoned to this conference room.

Only not for what he's been told. It's another ruse. Inside are some 30 people -- partners, state and federal officials, including Marcy M. Forman, director of investigations for Immigration and Custom Enforcement who is in from Washington, D.C. and who is big on working with the private sector and recognizing civilians when they pitch in.

Howard and Machin are there. Machin and Engel man-hug. Forman says a few words, gives Engel a plaque. Engel, eyes incredulous, has become something very rare: a lawyer at a loss for words.

"Well, I'm humbled," he says. "And really without words. But what these guys do and what law enforcement does every day is the real story. Those really are all the words I have."

Later, Engel finds his words. It was an all-around great experience, he says. Machin and Howard are now good friends of his.

"It's the coolest thing I've ever done in law, far and away," Engel says. "On my cool-o-meter, this is a 10."

And then a cautionary note:

"I'm never going to get crosswise with the government. Those guys have so many tools. And everything you do in this world leaves a footprint. I feel safer and a little less safe all at the same time."

pbeach@statesman.com; 445-3603

Trail of stolen Luger

Late 1995-early 1996: Prized 1898 Borchardt Luger 5 stolen from Waffenfabrik Museum in Bern, Switzerland (Museum curator Walter Schlatter eventually convicted of the theft)


April 2002: Central Texas man travels to Switzerland to broker sale of stolen firearm and two other Lugers for $60,000


June 2002: San Mateo County, Calif., rare gun dealer travels to Switzerland, buys gun, travels to Germany, passes gun -- with five pieces temporarily removed to negate its value -- to exporter; exporter flies from Germany to San Francisco via Dallas and returns the gun to buyer


April 30, 2003: Weapon seized by federal officials in San Mateo County


February 2004: Stolen Luger returned to Switzerland in a formal ceremony at the American embassy in Bern


May 12, 2005: Austin attorney Brian Engel honored by federal investigators in surprise ceremony at his Austin office for his role in investigation

[ryedawg]

My question: Why was Heinz Schlatter not arrested for having procession of the Luger and trying to sell it? After all, it was stolen property. Why didn't the investigation continue with more arrests? Is Heinz Schlatter still wanted by the Police?

[mcsap]

All this over a semi-auto pistol ? I could understand if it was a wheelgun involved but NORM.....this was a SEMI !!!!!!!!!!!!!!!

[Norm357]

Holy crap! I posted this 6 years ago!

[MikeG]

Holy crap! I posted this 6 years ago!

And if the zombie thread resurrector had read it, the last post would still be 6 years old.

[kels]

MCSAP, thats is like saying the Hope diamond is a rock.

[demon00seven]

There is a problem of stolen Luger and that's very serious issue, and yeah, police should take arrest warrants and take him into custody for stolen weapon. And this case should be solved under the supervision of senior officers, I mean police officers. And that's very informative article thank you for sharing.

[marinepilot]

Okay, this is enough. I would have thought when Norm posted that this thread is over 6 years old, people would have realized not to post in it anymore. If someone feels the absolute need to bring it up again, start a new thread. Let this one rest in peace.