Newly declassified CIA documents show the Americans and the German BND knew Eichmann was hiding in Argentina at least two years before Israeli agents snatched him from the streets of Buenos Aires on his way back from work. They knew how long he had been in the country and had a rough idea of the alias the Nazi fugitive was using there, Klement.

Even though German intelligence had misspelled it as Clemens, it was a crucial clue. The Mossad effort to track Eichmann had been suspended at the time because it had failed to discover his pseudonym. They were ultimately tipped off by a German official disgusted at his government's failure to bring the war criminal to justice.

Embarrassment

Washington and Bonn failed to act on the information or hand it to the Israelis because they believed it did not serve their interests in the cold war struggle. In fact, the unexpected reappearance of the architect of the "final solution" in a glass box in a Jerusalem court threatened to be an embarrassment, turning global attention to all the former Nazis the Americans and Germans had recruited in the name of anti-communism.

Historians say Britain and other western powers probably did the same, but they have not published the evidence. The CIA has. Under heavy congressional pressure, the agency has been persuaded to declassify 27,000 unedited pages about American dealings with former Nazis in postwar Europe.

One of the most startling of those documents is a CIA memo dated March 19 1958, from the station chief in Munich to headquarters, noting that German intelligence (codenamed Upswing) had that month passed on a list of high-ranking former Nazis and their whereabouts. Eichmann was third on the list. The memo passed on a rumour that he was in Jerusalem "despite the fact that he was responsible for mass extermination of Jews", but also states, matter-of-factly: "He is reported to have lived in Argentina under the alias Clemens since 1952."

There is no record of a follow-up in the CIA to this tip-off. The reason was, according to Timothy Naftali, a US historian who has reviewed the freshly-declassified archive, it was no longer the CIA's job to hunt down Nazis. "It just wasn't US policy to go looking for war criminals. It wasn't British policy either for that matter. It was left to the West Germans ... and this is further evidence of the low priority the Germans gave to hunting down war criminals."

It was not just a question of bureaucratic inertia. There were good reasons not to go hunting for Eichmann. In Bonn, the immediate fear was what Eichmann would say about Hans Globke, who had also worked in the Nazis' Jewish affairs department, drafting the Nuremberg laws, designed to isolate Jews from the rest of society in the Third Reich. While Eichmann had gone on the run, Globke stayed behind and prospered. By 1960 he was Chancellor Konrad Adenauer's national security adviser.

"The West Germans were extremely concerned apparently about how the East Germans and Soviet bloc in general might make use of what Eichmann would say about Hans Globke," Mr Naftali said.

It was not just a West German concern. Globke was the main point of contact between the Bonn government, the CIA and Nato. "Globke was a timebomb for Nato," Mr Naftali said. At the request of the West Germans, the CIA even managed to persuade Life magazine to delete any reference to Globke from Eichmann's memoirs, which it had bought from the family.

But it was not just Globke. When Eichmann was captured the CIA combed files it had captured from the Nazis to find information that might be useful to the Israeli prosecution. The results caused near panic among the CIA's leadership because, unknown to the junior staff who had looked through the files, a few of Eichmann's accomplices being investigated had been CIA "assets".

An urgent memo was sent to CIA investigators urging caution and pointing out that if Moscow discovered these ex-Nazis had been working for the Americans that would make those agents "very vulnerable".

Meanwhile, some of the CIA's German agents were beginning to panic. One of them, Otto Albrecht von Bolschwing - who also had worked with Eichmann in the Jewish affairs department and was later Heinrich Himmler's representative in Romania - frantically asked his old CIA case officer for help.

After the war Bolschwing had been recruited by the Gehlen Organisation, the prototype German intelligence agency set up by the Americans under Reinhard Gehlen, who had run military intelligence on the eastern front under the Nazis. "US army intelligence accepted Reinhard Gehlen's offer to furnish alleged expertise on the Red army - and was bilked by the many mass murderers he hired," said Robert Wolfe, a historian at the US national archives.

'Unreconstructed'

Alongside the Gehlen Organisation, US intelligence had set up "stay-behind networks" in West Germany, who were supposed to stay put in the event of a Soviet invasion and transmit intelligence from behind enemy lines. Those networks were also riddled with ex-Nazis who had horrendous records.

One of the networks, codenamed Kibitz-15, was run by a former German army officer, Lieutenant Colonel Walter Kopp, who was described by his own American handlers as an "unreconstructed Nazi".

Most of the networks were dismantled in the early 1950s when it was realised what an embarrassment they might prove.

"The present furore in western Germany over the resurgence of the Nazi or neo-Nazi groups is a fair example - in miniature - of what we would be faced with," CIA headquarters wrote in an April 1953 memo.The new documents make clear the great irony behind the US recruitment of ex-Nazis: for all the moral compromises involved, it was a complete failure in intelligence terms. The Nazis were terrible spies.

"Subject is immature and has a personality not suited to clandestine activities," the CIA file on one of the stay-behind agents said sniffily. "His main faults are his lack of regard for money and his attraction to members of the opposite sex."

Those were the least of their flaws as would-be anti-communist agents. They had not risen in the Nazi ranks because of their respect for facts. They were ideologues with a keen sense of self-preservation.

"The files show time and again that these people were more trouble than they were worth," Mr Naftali said. "The unreconstructed Nazis were always out for themselves, and they were using the west's lack of information about the Soviet Union to exploit it."

The lesson would be well learned by young CIA case officers today.

"Threats change rapidly, and it's always exiles and former government elements who are the first to come running to us saying - we understand this threat. We have seen it with Iraqi exiles. No doubt we're seeing it now with Iranian exiles. We have to be smart and we have to know who we are really dealing with."

Protected Nazis

Adolf Eichmann The SS colonel who organised the final solution was so enthusiastic about his work that he carried on even after Heinrich Himmler had called a halt. He was captured by US troops but escaped to Argentina. Israeli agents tracked him down in 1960 and he was hanged in 1962.

Hans Globke A Nazi functionary working with Eichmann in the Jewish Affairs department who helped draft the laws stripping Jews of rights. After the war he rose to become one of the most powerful figures in the government. As national security advisor to Chancellor Konrad Adenauer, he was the main liaison with the CIA and Nato.

Reinhard Gehlen A major general in the Wehrmacht who was head of intelligence-gathering on the eastern front. He sold his supposed inside knowledge of the Soviet Union to the Americans who made him head of West German intelligence, an organisation he led until 1968.