The New Spymasters Page 6

  Whether or not the influence was direct, Bond was in the Reilly mould. And while the real world of spying may have diverged, these stories firmly maintained a myth of spying that has suited agencies like SIS and the CIA. The fictional heroic deeds of their intelligence officers, their virtual invincibility and huge importance were a lure for recruits and intelligence sources. While the truth of intelligence was a classified secret, the myth was the attractive bright light.

  One reason why myth is so important is that most good spies started as volunteers knocking on the door of agencies like the CIA and KGB. Their motives were driven by myth. And the false image has been relentlessly exploited. In a speech in 2004 after his retirement, James Pavitt – until then deputy director for operations at the CIA – conjured up an image of the modern spy business as a worthy successor to its forebears. ‘I would like to borrow the words of an Englishman from another time who – better than any spy novel – captured the spirit and ethos of the clandestine service,’ he said. And then he spoke these lines:

  From time to time, God causes men to be born who have a lust to go abroad at the risk of their lives and discover news – today it may be far off things, tomorrow, of some hidden mountain, and the next day of some nearby men who have done a foolishness against the state. These souls are very few; and of these few, not more than ten are of the best.51

  Pavitt was quoting from a spy novel, Rudyard Kipling’s Kim, the story of the ‘child of the world’ during the Great Game of the British Empire. It was the tale of a young man of another age, at ease with every language and custom of the Hindu Kush region, who could pass unnoticed and collect information. He was the spy the British had always wished they had, a more innocent version of Reilly. But the modern-day intelligence officer, as Pavitt knew, was not some updated version of Kim or Reilly.

  There were some exceptions of course. There is always a danger in any description of this highly varied business in being too emphatic. ‘I like to think I did some spying,’ said one former SIS officer, who was particularly known for his unilateral – and at times very dangerous – exploits.

  At the SIS training base in the eighteenth-century Fort Monkton near Gosport, new recruits have been taught for decades by retired army sergeant majors how to handle a pistol. But in truth the agency became a very cautious place, much less gung-ho than its American cousins, and almost entirely focused on the simple business of running spies: protecting their identity and keeping them alive. While some of these agents perished, at the time of writing insiders said that not a single SIS career officer had been killed in action since the Second World War.

  But the myths established by Kipling, Reilly and Bond had a life of their own, one that was particularly important because they established a virtuous circle. According to one former SIS officer, Britain had created a ‘cult of intelligence’ that would serve it well, ensuring ‘invitations to the top table’ of world affairs, even as it lost its empire and declined as a world power. ‘We created the impression that intelligence was something we were very good at.’

  And was that impression justified?

  ‘Yes, we were good at it.’ Just because the public had a false idea of how human intelligence worked, that did not mean it wasn’t working. Britain, he said, became adept at running spies, at being spymasters.

  The spy war that had begun after the 1917 Bolshevik Revolution would see a stunning series of intelligence coups: spies employed for years by the Soviet Union, for example, who worked inside the most sensitive jobs in the West, as well as spies employed by the US and Britain with access to the most sensitive of Soviet secrets.

  The question that lingered, however, said the same former officer, was whether spying really had any effect and made all those sacrifices worthwhile.

  Chapter 2

  The Best-Ever Liars

  ‘Imagine a locker room full of guys and each of them trying to tell how many girls they’ve screwed – that’s sort of the recruitment thing … “Man, I got one”’

  – Milton Bearden, former CIA officer1

  In August 1940, a year into the Second World War, an event of some significance in the history of espionage took place. A Cambridge University-educated journalist from The Times was taken up the carpeted stairs to the fourth floor of St Ermin’s Hotel, Caxton Street, in Victoria, London. A guard stood by in the corridor.

  ‘Take a good look at Philby, because he is now going to be one of us,’ said the officer of Britain’s secret intelligence service.2

  He had just introduced and vouched for a Soviet penetration agent, newly recruited to Section D (sabotage and black propaganda) of SIS. The agent was inside.

  Kim Philby had been working for Soviet intelligence for the last six years under the code names Stanley or Söhnchen (little son).3 Vetting of new officers was then so lax that no one had discovered his left-wing past, not least his dissolved marriage to a German communist, Litzi Friedmann. Within three years of his appointment at St Ermin’s, Moscow was pleased to find he had progressed further. He secured a position at SIS headquarters at 54 Broadway, around the corner from St Ermin’s, and a job in Section IX, the counter-Soviet division. Moscow told Philby to ‘do everything, but everything’ to become head of section; he did and succeeded.4

  It was ‘a masterstroke’, as spy historian Professor Christopher Andrew would declare. Philby and the rest of the so-called ‘Cambridge Five’ were ‘the ablest group of British agents ever recruited by a foreign power’.5 Andrew regards Philby as one of the greatest liars in history. Perhaps so. But his success was also testament to the arrogance of the British ruling class at the time. They had been trapped by their assumption that no one with such a background could ever betray their country.

  The story of Philby is one that British intelligence would rather forget, one that damaged its credibility for decades. Even so, it remains an essential case study on the nature of spying – and what spying can achieve.

  His case poses this question: if Philby really was one of the greatest spies in history, why did he ultimately make so little difference?

  Understanding why his achievements were limited, and why the actions of so few ‘great spies’ in the Cold War had real consequence, not only reveals that much of the effort and money spent on spying is wasted but also exposes the elemental weaknesses of the spy game. These weaknesses can sometimes be mitigated; in fact a look at past exaggerations of success and failures also provides clues about how spies can be usefully deployed.

  When Philby started spying for the Soviet Union in 1934 only nine years had elapsed since Reilly’s last foray into Russia. By then the advantage in the game of espionage was firmly on the Soviet side. For the West, the Soviet Union had become a sort of black box, mysterious and mostly inaccessible. But the NKVD – the successor to the Cheka and the forerunner of the KGB – was by contrast able to operate with relative ease in the much freer West. By both concealing the evils and failures of the Soviet communist system and, among other methods, exploiting concern about the rise of fascism, it had successfully recruited many spies across the West.

  There was one small difficulty: much of what the best Soviet spies reported was widely discounted and disbelieved in Moscow. In the case of Philby, what he reported seemed just too good to be true.

  Back at ‘Centre’, as the headquarters of Soviet intelligence in the Lubyanka building, Moscow, were known, his controllers were aware of British skills at deception.6 By the time he got his job in SIS, the war was on and Philby’s fellow spies had already told Moscow of the British system of ‘Double Cross’, by which they were feeding false plans to the Germans. Agents sent to Britain were captured and made to send back false information.

  What if, Philby’s controllers asked, the same kind of planted falsehoods were being deployed by the Cambridge ring against the Soviet Union?

  When Philby’s file was unearthed in Soviet intelligence archives after the Cold War, it revealed that the Soviets had ceased all contact with him in
February 1940, thinking that he was going nowhere. They re-established contact only after they learned he had joined SIS. But they were suspicious. Soviet analysts set Philby a test in 1942. They asked him to name the agents SIS had in the Soviet Union. When Philby said that SIS had none, it was taken as proof that he was an impostor. When fellow spy Anthony Blunt confirmed Philby’s report, it was taken that he too was a double agent. Philby’s file, number 5581, was handed to an analyst within the NKVD, Elena Modrzhinskaya.7 She was tasked with analysing all the information provided by Philby in order to determine whether or not he was lying. She recorded, ‘Not a single valuable British agent in the USSR or in the Soviet Embassy in Britain has been exposed with the help of this group, in spite of the fact that if they had been sincere in their co-operation they could easily have done so.’8 And she concluded, ‘He is lying to us in a most insolent manner.’9

  Modrzhinskaya was convinced the SIS must have been run by fools if Philby and Co. were genuine and their masters did not realize that so much precious information was leaking to Moscow.10 She also complained that Anthony Blunt, who had penetrated MI5, was taking ‘incomprehensible’ risks by carrying original secret materials to meet his case officer. According to Soviet archives, from 1941 to 1945 he handed over a total of 1,771 documents.11

  Phillip Knightley – the former Sunday Times journalist who first exposed Philby’s position in SIS – concluded that Modrzhinskaya’s report was ‘confirmation of a theory that I have long held – that most spying is useless because the better the information a spy produces, the less likely he is to be believed’.12 For a secret service, this was the key problem with hiring foreigners as agents. It was hard to trust them.

  In 1943, the NKVD wrote to its London ‘rezident’ (station chief) to say that all five Cambridge spies were British moles. ‘There is no other way of explaining,’ wrote the Centre, ‘how “The Hotel” [code name for SIS] and “The Hut” [SOE] could entrust such critical work in such responsible areas to individuals who were involved in Communist and leftist activities in the past.’13

  But Moscow could never be sure they had been deceived, said Knightley. No one wanted to risk their careers by cutting off contact with potentially the best spies they ever had. Even if the Cambridge spies were plants, it would have been foolish to tip off the British that the NKVD knew. So they reluctantly continued to run these agents, not discovering for years that they were genuine. It meant that real gold nuggets of information were given little weight. For example, Moscow dismissed a 1943 report from their British agents providing a crucial technical detail – the thickness of armour on new German tanks. The NKVD’s London residence (as the Russians call their foreign intelligence stations) was informed by Moscow the information was dubious because the report did not harm British interests.14

  Even so, not everything Philby said was ignored. In one case, the Soviets reacted swiftly and ruthlessly. This was when Philby warned, in September 1945, that one of their intelligence officers based in Istanbul, Konstantin Volkov, was planning to defect to the West and was promising to bring news of a mole ‘fulfilling the function of head of a section of British counter-espionage in London’ (in other words, Philby himself). Moscow sent two hit men to murder him, which they did.15

  * * *

  There were similar Soviet blunders to Philby’s case in the handling of Richard Sorge – a dashing member of the Nazi Party, a journalist and, in 1941, a part-time officer at the German Embassy in Tokyo. He was also an agent for the GRU, Soviet military intelligence.

  For months, there had been rumours that Adolf Hitler was about to renege on his pact with the Soviet Union and invade the country. Stalin himself had said that war with Germany was inevitable, but he refused to accept specific warnings that it was imminent. Then on 1 June 1941, Sorge wrote, ‘Expected start of German-Soviet war around June 15 is based exclusively on information which Lieutenant-Colonel Scholl brought with him from Berlin … [for Ambassador Ott].’16

  His report (confirming eighty other warnings from sources17) was annotated in Moscow: ‘Suspicious. To be listed with telegrams intended as provocations.’ Stalin had rejected a previous warning as being sourced from ‘a shit who has set himself up with some little factories and brothels in Japan’.18

  Sorge was only a week off the mark. German tanks and four million soldiers started pouring across the Soviet border on 22 June, launching Operation Barbarossa.

  As John le Carré wrote in 1966:

  In 1941 Sorge had given to his Russian masters the exact date on which the German armies would invade the Soviet Union. At the hour of victory, this report was still rotting in a file marked ‘dubious intelligence’, and the two Soviet officers who had controlled Sorge’s activities lay in their graves, purged as enemies of the people.19

  The rejection of intelligence sent to Moscow by what were then the Soviet Union’s top spies, Philby and Sorge, was no accident. Rather, as Knightley hints, it touches on the nature of spying.

  It might be tempting, as some do, to pin the problem on Stalin and the Soviet system at the time. After all, the communists were legendary for their paranoid and conspiratorial nature, as well as the extreme caution that was engendered by the purges and show trials of the 1930s. (By 1941, three of Philby’s previous controllers had been shot dead in purges.20) Stalin himself may have been paranoid to the point of insanity. But there were examples from the spy work of other nations suggesting that secret agents’ greatest triumphs were destined, in general, to be disbelieved.

  One former CIA station chief described such an episode, which has never previously been disclosed. Before the Yom Kippur War of 1973, an agent had obtained for him all of Egypt and Syria’s invasion plans. He filed them to headquarters in Washington. The plans detailed the order of battle and the position of every unit. But he, and by extension his source, were not believed. The officer involved told me that CIA analysts could not accept that he had such a good agent who would provide him with these things. After the event, the station chief was a hero. It boosted his future credibility. But such opportunities were rare and too easily squandered, as they were here, because of analysts’ unwillingness to believe the human source. The CIA considered this episode an example of the success of agent reporting being trumped by a failure of analysis. The ex-officer said, ‘Since Pearl Harbor I have never been a great believer in assessment by analysts who are thousands of miles from the reality on the ground and just reading reports. Accurate agent reporting is fact. Intelligence analysis and estimates are guessing – educated guessing, but still guessing.’21

  Or, back in 1909, consider an agent called Le Vengeur, a member of the German general staff, who sent French intelligence a copy of the Schlieffen Plan, which described how the Kaiser would invade France in the First World War. His disclosures were ignored, even when the plan was also stupidly published in the Deutsche Revue.

  It becomes evident from many cases that real-life spy stories tend to end in an anticlimax. A great coup, some terrible plot discovered, but then, when the spy comes home to tell his story, it is all for nothing. Why do the efforts of spies so often come to naught? It has to reflect a number of critical weaknesses in the business.

  First, spies struggle with credibility because human intelligence delivers its product in a particularly frail vessel. To obtain secrets, spies must be treacherous. They must betray their country and tell lies to those around them. Truths from a spy come delivered in a wrapping of lies. It is hard to be sure that such habitual and accomplished liars are not being deceptive about the information they are delivering. This doubt is accentuated by the way modern spy agencies depend on foreign agents, rather than using their own officers. The agencies usually deliver what is second-hand information, technically hearsay. The game has too many layers.

  Second, there is the problem of what we could call truth-shock. An important revelation is something that challenges existing belief. The better the story, the harder to convince. Dull and conventional wisdom, u
nsurprising warnings, these all pass safely and rapidly into reports for presidents and prime ministers. But an intelligence agency that issues a surprising warning risks ridicule and inquiries if it turns out to be wrong and so will tend to agonize over such warnings, possibly until too late.

  Third, there is a problem of incentives. To use the language of economics, spying, like journalism and diplomacy, can be viewed as part of the market for information, a market that is famously imperfect. It is hard to trade efficiently in information because to describe fully the product that you are selling (for example, to say that the Russian president will visit Minsk on Monday) is already to hand over the product and devalue it. Secret intelligence is even harder to trade because it is information that often cannot be verified. A plan for a nuclear missile strike may be verifiable only after it has taken place. Imperfect markets like this lead to what economists call ‘perverse incentives’ – a tendency to do suboptimal things. A rational spy may have an incentive to invent or exaggerate secrets that cannot be verified. And the rational spy agency may have a perverse incentive to reject information it cannot immediately verify, and to overvalue verifiable titbits.

  These weaknesses – a lack of credibility, inbuilt inertia against shocking information and poor incentives – conspire to hinder spies from making a difference. Intelligence agencies have worked to counter these problems by, for example, developing a sceptical mindset to test the credibility of their agents. But, as both the CIA and the KGB found to their cost during periods of the Cold War, healthy scepticism can turn quickly into a sickly, paralysing paranoia that corrupts faith in faithful friends. Such a disease can devalue all the highly prized fruits of intelligence.

  * * *

  What should these inbuilt weaknesses tell us about whether or not spies can ever be effective? Generalizing from specific cases is always dangerous. Even with Philby and Sorge, the fact that during certain periods their intelligence was ignored hardly allows us to sum up the overall value of their betrayal, still less of spying as a whole. But the sheer scale of the espionage that took place during the Cold War, and the volume of detail about it disclosed publicly, do provide us with a platform from which to make a number of observations.