It was never much of a surprise that Israel's Mossad went after every surviving Nazi they could find following World War II, given German atrocities against European Jews. It does come as a surprise to learn that Otto Skorzeny—the psychopath who was as close as Hitler had to a real super soldier—ended up employed by the Mossad. He may have even carried out assassinations at the direction of Israel's formidable intelligence agency.
Skorzeny was a 6'4" former fencer with a gruesome dueling scar on his face that only added to his whole super villain vibe. He was an ardent Nazi, joining the party in 1931. He eventually became a second lieutenant in the SS, where he distinguished himself enough to eventually end up running commando training. Skorzeny sent commandos disguised as U.S. soldiers on sabotage missions and was the mastermind behind the Nazi mission to rescue imprisoned Italian fascist dictator Benito Mussolini.
Skorzeny was tried after the War for the operations involving disguised commandos—wearing an enemy soldier's uniform on such missions is a war crime—but acquitted. It was during his post-war life actively aiding enemies of Israel that things took an unexpected turn, according to an article in Forward magazine by Israeli author Yossi Melman and CBS newsman Dan Raviv.
In 1962 German scientist Heinz Krug disappeared somewhere between work and home. Krug had been a rocket expert for the Nazis and in the early sixties he'd been traveling regularly to Egypt and assisting the Egyptians in beefing up their weapons. Rumors planted in Israeli press at the time suggested Egypt had decided Krug might turn on them and help Israel, but Melman and Raviv claim they only recently determined the real truth behind his fate and it's shocking:
We can now report — based on interviews with former Mossad officers and with Israelis who have access to the Mossad’s archived secrets from half a century ago — that Krug was murdered as part of an Israeli espionage plot to intimidate the German scientists working for Egypt.
Moreover, the most astounding revelation is the Mossad agent who fired the fatal gunshots: Otto Skorzeny, one of the Israeli spy agency’s most valuable assets, was a former lieutenant colonel in Nazi Germany’s Waffen-SS and one of Adolf Hitler’s personal favorites among the party’s commando leaders.
Raviv and Melman write that Israel had a perfectly practical reason to work with a monster like Skorzeny: "to get as close as possible to Nazis who were helping Egypt plot a new Holocaust."
The recruitment of Skorzeny, who was living the good life in fascist Spain at the time, reads like something out of a spy novel. An unnamed Mossad agent and a helper posed as a couple, got to know Skorzeny and his wife, and seemed to have fooled the aging Nazi. Then they arrived together at Skorzeny's home and Raviv and Melman report that "Skorzeny — the charming host — pulled a gun on the young couple and declared: 'I know who you are, and I know why you’re here. You are Mossad, and you’ve come to kill me.'"
Cool-headed wrangling ensued, and in the end, Skorzeny was a Mossad agent. He continued doing work for Israel off and on for years.
As to why a hardcore Nazi like Skorzeny did such a seeming about-face, Raviv and Melman throw out several possibilities. He may have had regrets; he also may have been completely amoral and "the kind of man who would feel most youthful and alive through killing and fear."
It may have simply been that Otto Skorzeny determined he was very good at deception and murder—that they were part of his trade—and he just wanted to keep doing what he was good at. And if that perversely also kept him safe from assassins who would have loved a chance to blow his brains out, all the better.
He died of cancer in 1975, and in their Forward article Raviv and Melman note that Skorzeny's Mossad handler attended his funeral.