In March 1936, the German American Bund was established as a follow-up organization for the Friends of New Germany in
Buffalo, New York.
[6][11] The Bund elected a German-born American citizen
Fritz Julius Kuhn as its leader (
Bundesführer).
[12] Kuhn was a veteran of the
Bavarian infantry during
World War I and an
Alter Kämpfer (
old fighter) of the Nazi Party who, in 1934, was granted American citizenship. Kuhn was initially effective as a leader and was able to unite the organization and expand its membership but came to be seen simply as an incompetent swindler and liar.
[6]
Kuhn and a few other
Bundmen traveled to
Berlin to attend the
1936 Summer Olympics. During the trip, he visited the
Reich Chancellery, where his picture was taken with
Hitler.
[6] This act did not constitute an official Nazi approval for Kuhn's organization: German Ambassador to the United States
Hans-Heinrich Dieckhoff expressed his disapproval and concern over the group to Berlin, causing distrust between the Bund and the Nazi regime.
[6]
On March 1, 1938, the Nazi government decreed that no
Reichsdeutsche [German nationals] could be a member of the Bund, and that no Nazi emblems were to be used by the organization.
[6] This was done both to appease the U.S. and to distance Germany from the Bund, which was increasingly a cause of embarrassment with its rhetoric and actions.
[6]
In 1939, a New York
tax investigation determined that Kuhn had
embezzled $14,000 from the Bund. The Bund did not seek to have Kuhn prosecuted, operating on the principle
(Führerprinzip) that the leader had absolute power. However, New York City's
district attorney prosecuted him in an attempt to cripple the Bund. On December 5, 1939, Kuhn was sentenced to two and a half to five years in prison for tax evasion and embezzlement.
[23]