No, the jewels were supposed to have been ones that Hermine had gotten from the Kaiser but perhaps belonged to the Crown. I found a little more (in the New York Times) that indicated that the Army handed the case over within days to the German police. It seems they were investigating Hermine's family for the theft of Hohenzollern property. It was a family affair rather than a military crime ala the Hessian jewels.
Here's a summary:
'This ends the Army's role in what is turning out to be the melodrama of the abortive attempts of her children to cash in on an estimated $5,000,000 worth of expensive gifts' that she was given by the Kaiser. 'The whole story was summed up by a CID agent as a a 'case of double-cross and counter-doublecross'. That Hermine died in the midst of a smuggling operation in which her son Ferdinand's admitted mistress played a leading role was said...to be a coincidence.' Nevertheless, the mistress, a Vera Herbst, age 41, was book on charges of suspected murder and theft. She was released fairly soon though, the police admitted they wanted to put a scare into her. There were supposedly 95 pieces of jewelry stolen from Ferdinand's apartment--Vera had brought them to Berlin that May in a suitcase--and 25 pieces (worth $2,000,000) were still missing. The CID said that all they had to go on was hearsay that any theft had been committed though. The CID also recovered some 32 pieces in 2 suitcases that had been smuggled in but were unrelated to the supposed theft. CID said the only reason the military got involved was because Prince Ferdinand was a friend with someone and asked the person to guard the suitcases. When he retrieved the suitcases he later reported the items missing. The military investigated, found several of the 'missing pieces' in Ferdinand's apartment (he accompanied them on the search which doesn't seem the smartest thing) determined the American wasn't involved, and therefore turned the case over to the German police since it wasn't a military matter any further. The were rumors that an autopsy had been requested for Hermine but this turned out to just be part of the interrogation tactics (like the charges against Vera Herbst) and such a request wasn't actually made. The German police were now charged with trying to find jewelry that didn't appear to be any recognizable crown jewels but rather smaller pieces unaccounted for in official records--if, indeed, there were actually any jewels missing. The military seemed glad to wash its hands of a case involving the Russians, royalty, missing jewels, smuggling, Berlin's underworld and potential foul play.
According to the Army, the story begins when Prince Ferdinand sold a diamond necklace belonging to his mother that April for 1,200,000 marks to buy a Berchtesgaden hotel. Other family members say that the proceeds were supposed to have been split amongst them but that Ferdinand pocketed the whole amount. That May, Fraulein Herbst visited Hermine (who was living in a house with a grandchild and which was also occupied by a Russian) and convinced Hermine to turn over a bunch of jewelry to her so that she could smuggle it to Berlin and give it to her children. This she did and Herbst brought the 95 pieces (itemized by her and Ferdinand and including tiaras, earrings, brooches, bracelets, watches, rings and various objects and toiletries) to Berlin in a suitcase. She then returned for about a half-dozen more pieces which, according to Herbst, she planned on giving to his sister Prince 'Carmo' who resided with Ferdinand. It was these 6 pieces that Herbst turned over to US investigators the morning of the newspaper story. Meanwhile, 'Carmo' obtained several more pieces of jewelry and didn't tell anyone about it and turned them over to investigators. Prince Ferdinand said there was a need for his American friend to guard the suitcases because he, the Prince, was being shadowed around Berlin and being forced to move from hotel to hotel in a game of 'cat and mouse' with the Soviets.
The jewels that were in possession were put in the custody of the police since there could be an international incident due to the smuggling of the gems from the Soviet zone to the Allied one. The jewels that were eventually accounted for (I don't think some ever were, if they even existed or went missing despite the Army questioning dozens of Berlin underworld figures of various nationalities--they weren't able to turn up a clue) were held in a bank until Hermine's will was probated. She split her estate amongst her children. The last newspaper account I saw indicated that as soon as the paperwork was done the jewels would be released so I guess it was all worked out.
