The Circus, page 11
Angleton was then forty-five years old. He was the son of a senior National Cash Register Company official and had been educated at Malvern College in England, Yale University and Harvard Law School. In 1943 he joined OSS, the forerunner of the CIA, and was posted to the OSS X-2 counter-intelligence staff at St Albans where he met Kim Philby, then head of the Iberian department of Section V of MI6. Angleton proved to be a rarely gifted intelligence officer and, when he was stationed in Italy in 1944, he was, aged twenty-seven, the senior intelligence officer in that theatre.
When KAGO was passed into the care of Angleton, he moved out of Ashford Farm and was established in a suburban home on the outskirts of Washington. He had been provided with a new identity, that of ‘John Stone’, and a full-time CIA driver/bodyguard. He was, however, less than satisfied and decided to move to England. The CIA discouraged this idea for as long as possible, but by the spring of 1963 they were unable to prevent him from leaving. It was a move that MI5 welcomed.
KAGO’s comments to Martin and MI6 had led to the creation of the Fluency Committee, as we have seen, and in the meantime the Committee had come to some very disturbing conclusions.
The basis of KAGO’s philosophy was that the KGB had the skill to penetrate the West's secret departments and manipulate their counter-Soviet operations. According to KAGO there was not a single such organization in the world that had escaped this attention. The cases of Burgess, Maclean, Philby, Blake, Wennerstrom and Felfe were all evidence of the Soviet offensive. Yet there had been no suggestion to date that MI5 itself had been a target.
The Fluency Committee took the apparently logical view that if the Secret Intelligence Service and the Foreign Service had been penetrated, then surely the Security Service would also have been a target. If one was to follow this negative argument then there was circumstantial evidence to support such a disagreeable contention. Unlike most countries, Britain had not received any defectors. On its own this fact could mean nothing, bearing in mind that the CIA were generally recognized as having very substantial funds available for covert operations such as financing defectors. But there were other pieces of the jigsaw, such as MI5’s unsatisfactory record with Soviet double agents. The success of the double-cross system during the last war had led MI5 to believe that they were skilled handlers of double agents. In fact it was the proud boast of B 1(a) that they had only lost one double agent, an Abwehr officer code-named ARTIST. He had been trapped by the Gestapo in 1944 and murdered. After the war B2 and later D4 launched a similar double-cross operation against the Russians, but the results had been disappointing. Most had followed the same pattern. A patriotic Englishman would be approached by a KGB or GRU officer and made an offer of recruitment. Sometimes there was a financial inducement, on other occasions blackmail was involved. The person concerned would then contact the Security Service and be assigned a case officer, thus coming ‘under control’. The agent would then build up a relationship with his Soviet handler which had a two-part advantage to MI5, according to the text-books. The first was the positive identification of a hostile Soviet Bloc intelligence officer; the second was the opportunity to feed Moscow with specially prepared information, thus either deceiving them or simply causing them to waste valuable time which might otherwise be more profitably spent.
This first advantage was important to MI5 because of the organization’s very limited resources. The combined forces of the KGB and GRU in London were always judged to be in excess of 150 intelligence officers. With such an excessive number it was obviously impossible to keep surveillance on them all, so if even a small proportion were tied up in worthless exercises, it enabled MI5 to deploy its forces more effectively. It was also believed that of the 150 intelligence officers only about six were actively engaged in the recruitment and running of important agents. The question was, which six? With some hundred decoys moving around the town every day of the week, it was an impossible task. But according to KAGO, the Soviets actually capitalized on these counter-measures, turning them to their advantage.
Experience gained during the war gave MI5 even more cause for worry. After the collapse of Germany most of the Abwehr’s case officers were shipped to MI5’s interrogation camp at Ham Common to undergo a thorough programme of debriefing. The object had been to identify unknown Nazi sources in England and hear an account of the double agents from the other side’s point of view. Some Germans had co-operated, others had refused to answer any questions, but one lesson had been learnt: case officers who suspected their agents had been ‘turned’ invariably failed to tell anyone. This was not just a matter of currying favour with the enemy, but rather an arrogant reluctance to openly admit that someone on the other side had got the better of them. There were countless wartime examples of double agents apparently achieving the impossible or being in two places at once. This had happened in spite of the most rigorous supervision and could not be avoided. Yet when these blunders had happened there had been no response from the other side. In fact in 1943 the Twenty Committee had authorized an operation (involving MI5’s double agent SCRUFFY) designed to convince the Abwehr that MI5 were so clumsy at running double agents that there was little danger of one surviving undetected. To the amazement of all concerned the Abwehr had registered nothing and had continued the contact without any attempt to turn the double agent into a ‘triple’. This had so alarmed Bl(a) that the case had been hastily abandoned.
KAGO’s theory was depressingly simple. A KGB agent in London would approach someone confident that the recruit would report the matter to MI5. When the subject responded positively and began supplying information, the KGB officer would do one of two things: he would either use the double agent to identify the MI5 case officer involved (a useful exercise to establish MI5’s internal structure), or he would make it known to the agent that the agent was being run by MI5 and use him to recruit the MI5 case officer. Thus appeared the spectre of MI5’s case officers themselves becoming agents rather than admit to a higher authority that they had been ‘blown’. What made this latter course so unpalatable was the fact that, according to the files, no case officer had ever reported being approached by the opposition in such a manner. KAGO was convinced that such techniques were standard practice, although he was unable to be specific about individual cases. Certainly MI5 had its share of arrogant young case officers anxious to demonstrate their prowess at the intelligence game.
If KAGO’s theory was correct, then it would explain MI5’s lack of success with double agents and the reluctance of potential defectors to entrust themselves to a Security Service they knew to be thoroughly penetrated. It would also explain the uneasy feeling that some had about MI5’s post-war ‘successes’. In the case of Brian Linney, Prybl had failed to keep the rendezvous at which both were to be arrested. The surveillance on Lonsdale and the Krogers had been vastly time-consuming (and they were all to be swapped eventually, Lonsdale for Greville Wynne in April 1964 and the Krogers for Gerald Brooke in July 1969). Moreover, there had already been a suspicion that a more senior Soviet ‘illegal’ had completely evaded capture in the Lonsdale-Kroger episode. And there were other examples: in 1951 Burgess had clearly received a warning about Maclean’s impending interview with MI5 and John Cairncross’s contact had failed to show for his rendezvous. There were some nagging doubts about the Vassall case too. Six days before George Smith arrested him, his Soviet case officer, Nicolai Karpekov, had fled the country. Had he been tipped off?
KAGO’s ideas were taken so seriously that the Fluency Committee decided they should take up the offer that the CIA had turned down. He was accordingly invited to England and told that his help would receive the recognition the Americans were so reluctant to give.
‘John Stone’ (KAGO’s new alias) sold his CIA-supplied house in Arlington, Virginia, and embarked in New York for a transatlantic voyage with his wife and two daughters. He had given his German Shepherd guard-dog and his television set to a fellow Soviet defector.
When KAGO and his family arrived at Southampton he contacted the two members of the Fluency Committee he had met at Ashford Farm. It had been agreed that initially at least KAGO would fend for himself and tour the country staying at hotels selected by him. Every few days he would telephone Arthur Martin and arrange a meeting to discuss a particular case. For the sake of security no one would know KAGO’s exact location. There was also another reason for this somewhat over-elaborate procedure. By the summer of 1963 MI5 had accumulated much more evidence of a Soviet agent working within their ranks.
At this point we must go back to the previous year and follow other developments that were taking place in parallel to the KAGO case.
Almost a year before KAGO’s unexpected defection in Finland another well-placed Soviet source had volunteered information to the Americans and had been politely turned away. The source was a self-confessed GRU officer and his approach was so blatant that the CIA concluded that he must be an agent provocateur. The British, however, decided to take him up on his offer, which was somewhat indiscreetly made to an English tourist, and thus began the case of Lieutenant-Colonel Oleg Vladimirovich Penkovsky, code-named ALEX.
Penkovsky was not entirely unknown to either MI6 or the CIA as he had been posted to Ankara in 1955 as Assistant Military Attaché. On his return to Moscow he had made various unsuccessful attempts to contact Western intelligence organizations, but it was not until 1960 that he had been contacted by Greville Wynne, one of MI6’s many agents operating under business covers. A number of British businessmen who regularly travelled within the Soviet Union were encouraged to keep their eyes open and then to attend a debriefing session on their return to England. Wynne, who had some wartime experience with MI5, had been recruited by two senior MI6 officers and encouraged to build up his firm’s trade with the USSR. In 1956 he had played the part of a decoy in a joint MI6/CIA operation to assist the defection from Odessa of a certain Major Kuznov.
In April 1961, Penkovsky arrived in London to lead a Soviet trade delegation. The party, which consisted of six senior Russian officials, booked into the Mount Royal Hotel near Marble Arch, where MI6 had arranged a suite of rooms on the floor above the delegation’s. Here Penkovsky underwent a lengthy debriefing at the hands of the CIA and MI6.
The CIA had been brought back into the operation for a number of reasons, not the least being their willingness to finance it. The head of the Soviet Russia Division of the CIA at the time was Jack Maury and he assigned George Kisvalter to the case with the code-name ALEXANDER. As it happened Kisvalter was already in London picking over the bones of Blake’s confession in an attempt to establish whether he had been responsible for Popov’s arrest.
When Penkovsky was ushered on 20 April into the converted hotel suite he was introduced to his four debriefers, although only the two Americans could actually speak Russian. Kisvalter chaired the meeting, the first of many, and Penkovsky delivered copies of Soviet training manuals, some ten thousand photographs of military documents and details of the very latest missile systems. The volume of information was gigantic and much of it was of direct interest to MI5 as well as MI6 and the CIA. For example, ALEX gave personal biographies of every GRU officer he had come into contact with and dozens of others who were known to his family. Kisvalter had the information sent to Washington where Maury gave it the highest classification of secrecy and, unusually, distributed it under a single code-name. The debriefing continued until 6 May 1961 when the delegation returned to Moscow.
MI5’s participation in the operation was limited to keeping ALEX’s delegation busy with tedious visits to factories in the Midlands and occasionally taking the opportunity to offer interesting subjects for the single member of the delegation who had been equipped by the GRU with a miniature camera. The reward for ‘C’ Branch’s efforts was a new insight into the Soviet order of battle at the London Embassy. ALEX was able to identify all the GRU officers and give their real names, including the GRU rezident in London, Karpekov, who was listed as a Counsellor; his deputy, Colonel Pavlov; the Air Attaché, Colonel Konstantinov, and the Assistant Naval Attaché, Lieutenant-Commander Ivanov. This provided ‘D’ Branch with a complete picture of the rezidentura which remained accurate for some months and was later, as we will see, the cause of a major political scandal in England, resulting in the fall of Harold Macmillan’s government.
As well as detailing dozens of GRU operations and naming staff, ALEX also produced some remarkable documents for the West’s counter-intelligence experts. Among them was the transcript of a lecture given by Lieutenant-Colonel Prikhodko, a GRU officer who had worked at the United Nations in New York under diplomatic cover between 1952 and 1955. His lecture, entitled ‘Characteristics of Agent Communications and Agent Handling in the USA’, gave a fascinating insight into current GRU methods and field-craft.
The debriefings were continued later in May when Wynne visited ALEX in Moscow and was handed dozens of exposed Minox films. As a back-up Penkovsky was also assigned an MI6 case officer from the Moscow Embassy, Roderick Chisholm, who operated under the diplomatic cover of Second Secretary. He had, of course, been instantly identified by the KGB as a career MI6 officer (he had previously served in Germany and Singapore), so his wife Janet invariably acted as a courier whilst taking her children for walks in the afternoon.
In July 1961 ALEX made a second trip to London, this time to attend the Soviet Industrial Exhibition. On this occasion he was booked into the Kensington Close Hotel, only walking distance from his Embassy, and the debriefings were conducted at a rented flat in Coleherne Court in the nearby Old Brompton Road. Two months later ALEX was again in the West, this time visiting an exhibition in Paris. More ‘safe-houses’ were prepared and the debriefings continued.
The ALEX case began to go sour in January 1962, when it became obvious that his apparently casual encounters with Janet Chisholm had been monitored by the KGB. He reported that further meetings would be too dangerous and fell back on an elaborate series of dead-letter drops. This prearranged system relied on ALEX secreting his messages in hiding-places and then informing his case officer that they were ready for collection. This he did by telephoning the homes of CIA contacts twice and then hanging up after an agreed number of rings. The case officer would then check a particular lamp-post on the Kutuzov Prospect for a tell-tale black mark, which indicated that ALEX had completed his 'drop’ successfully, and empty the hiding-place. So as to reduce the possibility of interference by the KGB, no dead-letter drop was used more than once and the entire operation was only conducted once a month. ALEX was also instructed to give advance warning of his visits to the West via a system of apparently innocent tourist postcards mailed to MI6 cover addresses in London. It was this latter system that ALEX used on 12 January 1962 to call off further direct meetings, although on the occasions that he met Janet Chisholm at official diplomatic receptions, such as the Queen’s Birthday on 31 March 1962, which they both attended, and the Fourth of July celebration at the American Embassy, more valuable rolls of film passed hands.
By the summer of 1962 KGB surveillance on ALEX had intensified to such a degree that he advised that Wynne be withdrawn from Moscow a day earlier than planned. It was later established that at their final meeting, at the Ukraina Hotel, their conversation had been taped. In spite of the KGB’s by now obvious surveillance, ALEX continued to fill his dead-letter drops until one final abortive visit to an American Embassy reception on 5 September. ALEX failed to identify any of his CIA contacts and retained his packet of films. Before he could defect he was arrested by the KGB on 12 October. (The exact date of his arrest has never been disclosed. Some Western intelligence officers believe it may have taken place ten days later, on 22 October 1962.) News of ALEX’s arrest did not leak out until Wynne had been intercepted in Budapest on 2 November. Wynne was arrested after a cocktail party at his mobile trade exhibition. A pair of specially constructed vehicles were to be used to smuggle ALEX out to the West by road. A Soviet passport with all the correct authorizing stamps had been forged in the United States to enable ALEX to visit Hungary once he had shaken off the KGB in Moscow.
The escape plan had only the remotest chance of success, but the attempt had to be made so as to prevent ALEX being interrogated. He would have no alternative but to describe the extent of his work for the CIA/MI6 and would thus reduce its value. Wynne’s case was less important in intelligence terms because he had never seen ALEX’s material and therefore was not in a position to compromise any of it. As it turned out the Russians appeared to disbelieve that ALEX could possibly have passed the quantities of intelligence he admitted to, which enabled Fort Meade to continue decrypting the GRU signal traffic. That, however, was a doubtful consolation for his loss and that of Wynne. To compound the disaster, Popov’s execution was announced the very next month, in December. The statement in the Soviet press simply stated that an infantry officer, ‘Lieutenant-Colonel P’, had been shot for treason, as a spy of the American intelligence service. In the aftermath of the arrests of ALEX and Wynne no less than eight American and British diplomats were declared persona non grata and expelled.
A four-day show-trial was duly held in the Soviet capital in May the following year with the world’s press invited to inspect and photograph a display of MI6/CIA spy paraphernalia. The result was, of course, a foregone conclusion. Penkovsky was sentenced to death and confiscation of his property; Wynne to eight years’ imprisonment. Eleven months later Wynne was exchanged at Checkpoint Heerstrasse in Berlin for Gordon Lonsdale.
