Art of Betrayal Read online

  In October, a vast crowd gathered to cheer as each of the four flags which had hung over the Allied Control Commission building was lowered. The Soviet flag fell last. After ten years, the occupation was over. A few weeks later, the State Opera House, that symbol of Viennese pride, was reopened. Vienna had survived. The war had moved on. But the loyalties and betrayals nurtured in the crucible of Vienna were also moving on to play out on a larger stage.

  2

  THE COST OF BETRAYAL

  A violent banging on his front door summoned Anthony Cavendish from a deep slumber. It was three in the morning. He was MI6’s liaison officer with the Royal Navy in Hamburg in the British zone of Germany, a city out of which operations at the northern end of the Iron Curtain were run.1 At the door he found one of his radio operators in a visibly distressed state. There was a problem that required his urgent attention. The previous night, Cavendish and a fellow officer had taken three Baltic agents to the red-light district of Hamburg. The men, plucked from refugee camps, had been offered a last indulgence before embarking on a secret mission. It should have been relatively safe since they had been led to a bar in the Reeperbahn where the manager was an informant for Field Security. When Cavendish had retired for the night, the men had still been enjoying themselves, knocking back a peculiar German brandy drink and talking to some over-made-up girls while they watched the floor show. But the radio operator explained that, although two of the agents had made it back to their own secluded safe house, the third and the MI6 officer ‘looking after him’ had got into a fight.

  Cavendish threw on some clothes and headed for the bar. He found it smashed up. The police had taken everyone involved to the station. Cavendish persuaded them to release his two men, but there followed a long, painful post-mortem to ensure that the agents’ cover story as visiting businessmen had not been blown. This was the inauspicious prelude to one of MI6’s most aggressive and ill-fated operations of the early Cold War, which, along with many others, would be betrayed.

  A day or so later, when the weather had improved, the agents were taken down to a jetty at a nearby harbour. Waiting for them was a German called Helmut Klose. During the war he had captained E-boats which dropped Germans behind Russian lines to carry out acts of sabotage. He knew every nook and cranny of the stretch of coast along the Baltic. A German boat had been purchased by MIE and taken back to Portsmouth to be kitted out with a new engine which offered fifty knots with barely a sound. Klose’s cover was as part of the British Control Commission’s Fishery Protection Service.

  Cavendish’s job had been to establish a safe house, look after the agents and liaise with the Royal Navy. His naval contact was Anthony Courtney, a bluff officer whose remarkable career would take him back and forth between Moscow and London, from the netherworld of intelligence to the bright lights of parliament, and end in disaster at the hands of the KGB. Courtney was perhaps unique among British intelligence officers in having donated blood to the Red Army.2 His father had once sold machine tools to the Russians and would return from trips to the Soviet Union with beautifully carved wooden bears and books full of fairy stories. They were impenetrable to his son but had contributed to an abiding fascination with all things Russian, including its women.

  After joining the navy, Courtney was one of the few Westerners to visit the Soviet Union in the mid-1930s, a period when he was also in touch with MI6. He wrote up long reports for Naval Intelligence with details ranging from the battleships he saw to how many roubles a month a waiter earned. He also drafted papers on what operations could be mounted against the Soviets in the Arctic and Black Sea in the event of war. ‘I’m afraid I have rather violent ideas on what we really could do to the USSR if we tried,’ he wrote in a 1936 report.3 His experience led to a posting as deputy head of the Naval Mission in Moscow during the war, sailing the Arctic to Murmansk through storms violent enough to detonate mines around the boat. Those years in Moscow were filled with frustration and obstruction but he managed not only to donate blood in an act of solidarity but also to embark on an affair with a Russian dancer at the Bolshoi, which lasted until the secret police warned her off.4

  After the war, he advised MI6 on the use of fast surface craft and special submarines for operations in the Black Sea. In 1948, he had been made chief of intelligence staff to the Flag Office in Germany living with his wife in a house with a pool and tennis court, although he repeatedly complained of a lack of money. Germany offered him the chance to run his own front-line operations as he learnt how German fast boats could be adapted to slip quietly and quickly out of smaller harbours.

  Courtney had approached Helmut Klose in May 1949. Klose had not been a Nazi, but Courtney explained to him that his wartime activities had been discovered and suggested he might like to undertake similar work again.5 No pressure was needed since Klose proved happy to resume his duel with the Bolsheviks. Courtney’s deputy was John Harvey Jones, later chairman of ICI and TV trouble-shooter, who had joined Naval Intelligence after studying Russian at Cambridge.

  After a few false starts, Klose’s white E-boat, S-208, carrying Cavendish’s Baltic agents finally headed out from the harbour on 31 October 1949. Its destination was Latvia, which had been swallowed up by the Soviet Union during the war. The men included former members of the SS whose past had been conveniently overlooked. MI6 was fighting the new war as if it were the last one, finding exiles to drop behind enemy lines. These men had been trained in weapons and secret inks back in Britain, including at a firing range in Chelsea. They carried a brown suitcase containing radios, machine guns and pistols. In watertight plastic bags they had codebooks and false passports. They had money belts full of gold coins and each carried a cyanide pill in case of capture.6

  The Latvian drop was not the first. The Baltic coast, MI6 believed, was a weak point in the Iron Curtain. British intelligence had studied it closely. They knew it was guarded by camouflaged watchtowers, concealed lookouts and guard patrols, but these were at irregular intervals. The area closest to the shore had been evacuated and islands declared prohibited zones. Fishing vessels had informers placed on board and were scrutinised by coastal cutters, which guarded the boundary with the British sea zone.7 MI6 had already tried similar missions to Lithuania but these had ended in disaster with a KGB ambush on the beach.

  Klose dropped the men at an isolated spot. They made their way to the house of a priest and gave him their password: ‘Can I buy some beer here?’ The agents radioed back to Hamburg that their mission had started well. They headed for Riga and knocked on another door. They had arrived to help the resistance in the forests, they explained. The next day, their contact said he was going out to get food. Instead he got in touch with a man called Janis Lukasevics. ‘They’re comfortable and feel quite at home,’ he told Lukasevics.8

  The Baltic operations were masterminded by a brooding, secrecy-obsessed MI6 controller in London called Harry Carr. With an arched nose, intense eyes and straight black hair, Carr was the leading member of a group of MI6 officers for whom the Second World War had been only a brief interruption in their single-minded struggle against the real enemy. Back in the nineteenth century, the Russians had been Britain’s rivals as the first intelligence skirmishes were fought as part of the Great Game in Asia. The imperial roots of anti-Russian sentiment in the Secret Service were then supplemented by a deep distaste for Bolshevism and its class struggle. For Harry Carr, the appropriation of property was also personal. He had been born in the northern Russian port of Archangel in the last weeks of the nineteenth century. His father managed timber mills and Carr grew up in luxury with a grass tennis court and servants before everything was taken away by the Bolsheviks.9 A remarkable number of MI6 officers had links to the old Russia either personally or through marriage. This created a highly motivated faction who were emotionally committed to confronting the Soviets. In the 1920s they had fallen foul of a Soviet deception called the Trust – a fake émigré group which acted as flypaper to trap agents. But Carr
and his like had not learnt their lesson. A doer, not a thinker, Carr demanded aggressive operations. ‘There was a philosophy which affected almost everything they did which was “We must do something. Never mind what – but something,’” recalls a colleague who worked in Carr’s department just after the war.10

  Carr was among those itching to start operations against the Soviets after the Second World War and chafing at the restrictions initially imposed by the government on operating inside Russia. Eventually, the leash was loosened and it was agreed that operations could be launched from outside the Soviet Union into its perimeter.11

  One of those was the effort to support the partisans in the Baltic forests. But an ambitious KGB major called Janis Lukasevics was waiting. He had interrogated a group of Latvians who had landed as early as 1945 and by the time more groups landed in 1949, including those shepherded by Courtney and Cavendish, he was ready to enmesh them in his web of deception.12 The real partisans had been almost totally crushed by the Soviet secret police, and six of his KGB officers would pose as fake partisans. ‘We put them in a safe place,’ Lukasevics recalled decades later of the team dropped in October. ‘There was a decision not to touch them.’13

  The newly arrived agents were hidden under fish boxes in a truck and taken to meet their fellow ‘forest brothers’. Deep in the woods, the MI6 agents spent months training the ‘partisans’ and gave them codenames. They told them they would receive £20 a month paid into a London bank account. At one point, one of the MI6 agents put his arm around the shoulders of a ‘partisan’ and confided that in the first few weeks he had been worried it was all a KGB trap. They began to supply information back to London – profiles of people, troop movements and factory production – nothing special but good enough to be included in MI6’s weekly intelligence summary for the Foreign Office. More agents arrived, including another undercover KGB man planted to report back on every element of the operation.14 Over five years, Klose would drop many more agents into the Baltics. The KGB would capture and in some cases torture and kill them. MI6 had been ensnared. It had been betrayed. Who was to blame?

  At the same time as the Latvian operation was under way at the northernmost reaches of the Iron Curtain, an even more ambitious, but equally ill-fated, covert action was being undertaken by MI6 at the southern end. On the moonless night of 3 October 1949, a boat called the Stormie Seas lay 200 yards off a cove on the Albanian coast. A group of men climbed into a rubber dinghy and rowed ashore.15 Hidden by darkness, the landing spot was a remote ravine at the bottom of cliffs with a goat track leading up the scrub-covered mountain. One of the men thought he spotted a light, but a few seconds later it disappeared. When a British marine brought the second half of the team over in his dinghy, he found the first arrivals still waiting, unsure of what lay in store for them in the dark. He ushered them up the hillside. ‘They all just mooched off,’ he later recalled. ‘We’d let them down very badly.’16

  The nine men again split into two groups. Within hours, one group was ambushed and three of its four members killed. The others made contact with villagers who told them that soldiers had been in the area for several days. The Albanian security forces had been preparing for weeks. Their networks of informers had been told to be on the lookout.17 At a radio station in Corfu the MI6 team running the operation began to panic as days passed with no contact. Slowly messages trickled back and a few survivors made it into Greece to report the bad news. A second team that went in had likewise been expected and had fallen into a trap.

  These teams’ objective was to get a feel for the population in preparation for toppling the Albanian government.18 The losses were bad but not bad enough to put off those who had decided that this was the way in which the Cold War was to be fought. There were late-night conferences to work out what had gone wrong. Sitting in a secure office in the Pentagon, monitoring those first drops, one American said there had to be a leak. His counterpart, the newly arrived liaison from MI6, whom the Americans found comfortingly English and only mildly eccentric by his colleagues’ standards, remained quiet.19 The culture of the times, one MI6 officer recalled, was to meet every setback with the cry ‘not to worry, bash on regardless’.20

  The USSR was seen by Britain’s Joint Intelligence Committee in 1948 as a ‘hostile, messianic state, with a world-wide mission of hastening the elimination of capitalism’.21 Albania had been identified by both MI6 and the CIA as a weak spot in the Communist front and in February 1949 the decision had been taken to make it the test case to ‘roll back’ Communism, a policy in many ways as aggressive as anything the KGB was attempting. All means short of war were on the table.

  Britain had one problem. Money – or a lack of it. The country was broke. The solution was obvious: the Americans. They did not take much persuasion. Britain was retreating from centre-stage and passing the baton. In February 1947, London had informed Washington that its economic and military aid to Greece and Turkey would have to stop because Britain was approaching bankruptcy. Given the danger that those countries would fall to Communism, the US President announced the Truman Doctrine offering support to all ‘free people who are resisting subjugation’. This was followed by the Marshall Plan to offer economic aid to prevent Communist influence. It was accompanied by a vast increase in propaganda and covert action, including the backing of émigré groups and the financing of anti-Communist political parties in places like Italy where enormous effort had been expended to ‘win’ the election in 1948. The vogue phrase to describe this was ‘political warfare’. It ranged from propaganda to manipulating commodity prices, from counterfeiting currency to sabotage, from bankrolling émigré front organisations to dropping leaflets from hot-air balloons (some of which, destined for Czechoslovakia, were discovered by Scottish farmers, much to their bemusement).22

  Albania was a test case for the most aggressive end of the political-warfare spectrum. The British Foreign Secretary Ernest Bevin, a fierce anti-Communist thanks to his battles inside the trade unions, was a supporter. There were differences in emphasis between London and Washington, particularly over who to back. In one discussion with US Secretary of State Dean Acheson, Bevin uttered that great British battlecry: ‘Are there any Kings around that could be put in?’23 Not everyone in the Foreign Office and State Department was keen on the plan, but MI6 found an enthusiastic backer in Washington in the form of Frank Wisner, known as ‘the wiz’. A former corporate lawyer from Mississippi, he was smitten with the idea of using covert operations to take on the Soviets. From an office known as the ‘rat palace’ because of the vermin scuttling through its corridors, he ran the Office of Policy Co-ordination, which was tasked with fighting the secret war, a role he continued after the OPC was absorbed into the CIA in 1950. By 1951, Wisner was spending more than $200 million a year on his covert operations, three times the money spent on collecting and analysing intelligence.

  MI6 and the CIA have always had two functions – information gathering and covert action. The latter involves engineering outcomes with the hand of government hidden. For Wisner and his people, intelligence was about doing things, not finding out about things. ‘The central and decisive battles of the secret war are fought in the vast realm of covert political operations,’ wrote James McCargar, who led the American side of the Albanian operation. ‘The ultimate national aim in the secret war is not simply to know; it is to maintain or to expand national power.’24 Not everyone agreed. ‘The operational tail will wag the intelligence dog,’ one American spy chief warned.25 But the CIA, even more than MI6, came to be infused with a paramilitary culture and enthused by the possibilities that covert action offered. The US was deciding there was only one way to play against an implacable, deadly new enemy hell-bent on domination. ‘There are no rules in such a game,’ an official report argued in language that would be echoed after 9/11. ‘Hitherto acceptable norms of human conduct do not apply. If the United States is to survive, long-standing American concepts of “fair play” must be reconsidered … W
e must develop effective espionage and counterespionage services and must learn to subvert, sabotage and destroy our enemies by more clever, more sophisticated and more effective methods than those used against us.’26 (‘We cannot afford methods less ruthless than those of our opposition,’ a fictional British intelligence man argues in John le Carré’s The Spy Who Came in from the Cold.)

  Bankrolling Britain’s Albania plan was no problem for the cash-rich American spies who operated a slush fund siphoned out of the Marshall Plan money with almost no oversight.27 How the cash-strapped British Secret Service housed in the Broadway buildings by St James’s tube station, with its brown linoleum floors, grotty furnishings and bare lightbulbs, must have gazed in envy at the wealth of its younger, brasher cousin. Beneath the surface, a few in Washington detected a sour resentment of the Americans, particularly among some upper-class Britons, who disliked the passing of the baton and the anti-imperial instincts of their cousins.

  The awareness of no longer being top dog and of being reliant on American largesse was expressed in the fictional writings of one of Anthony Courtney’s friends and former colleagues from Naval Intelligence who, just as the Albania operation reached its zenith, was writing his first book. ‘Our people are definitely interested. They think it’s just as important as your friends do and they don’t think there’s anything crazy about it all. In fact, Washington’s pretty sick we’re not running the show,’ the CIA man explained to James Bond. Just as Bond’s British operation, fought at the baccarat table of Casino Royale rather than in the Albanian mountains, looked lost, CIA man Felix Leiter slides an envelope across the table, ‘thick as a dictionary’, with the words ‘Marshall Aid. Thirty-two million francs. With the compliments of the USA’, allowing Bond to win the day and bankrupt his enemy. In Ian Fleming’s fantasy world, the British were still in charge even if they did need American money. This was an escapist alternative reality in which the British reader could be consoled by the thought that, even as the days of Empire and greatness were passing, Britain was still good at something, a world in which the illusions of power and influence could be preserved in the form of a cool and ruthless superspy.28