In 1966, he established a trading organization called Kommer-
zielle Koordinierung, (KoKo; Commercial Coordination), which
in 1976 became independent of the trade ministry and in 1983 a
separate unit within the MfS. He thus enjoyed exceptional autonomy,
responsible only to Erich Mielke and Erich Honecker. Moreover,
Schalck-Golodkowski, an imposing figure with a deeply resonant
voice, had developed a host of international contacts as well as a
thorough understanding of Western markets (including its unwritten
practices). His overriding aim—to acquire hard currency to offset the
GDR’s chronic trade deficit—was disguised by the series of sham
companies that KoKo operated. Among the wide variety of transac-
tions concluded were weapons contracts with both Iran and Iraq, the
acquisition of embargoed Western computer equipment and other
high-technology goods, the sale of rare German art objects and an-
tiques to wealthy foreign clients, and the procuring of Western con-
sumer items for the party elite. In the mid-1980s, he also negotiated
two massive credits from West German sources that totaled nearly 2
billion DM, notably with the aid of the conservative Bavarian leader
Franz Josef Strauss. According to Schalck-Golodkowski’s calcula-
tions, KoKo along with its subsidiaries raised nearly 25 billion DM
between 1967–1989.
On 1 December 1989, prompted by West German press revelations
of his activities, the GDR People’s Chamber voted to investigate
charges of corruption and abuse of power. Fearing reprisals, he and
his wife, Sigrid (likewise an OibE in the MfS), fled to West Berlin
the following day. On 3 December, he was officially removed from
the SED’s Central Committee, along with a number of other former
luminaries. As cooperation with West German authorities appeared
the most prudent course, he provided extensive testimony to the
Bundesnachrichtendienst in the following years. A special fact-
finding parliamentary committee was also established and released
its 4,500-page final report in 1994. It revealed, for example, that in
1989 Schalck-Golodkowski’s network included 180 covert compa-
nies and raised 7 billion DM. Despite more than 50 different legal
charges lodged against him, only two guilty verdicts resulted: dealing
in illegal arms and breaking an embargo. He was given a suspended
sentence in each case, which allowed him and his wife to retire to
a lakeside villa in Bavaria. In his autobiography published in 2000,390 • SCHALCK-GOLODKOWSKI, ALEXANDER