Churchill's Spy Files

by Nigel West

  Two days later BUNBURY came again, unexpectedly, when Rothschild referred to the operation during a conference at Oxford attended by MI5’s Regional Security Liaison Officers (RSLO), as Liddell confided to his diary:

  Victor Rothschild has been talking to the RSLOs before lunch and had outlined to them Plan BUNBURY. He had written a circular letter which he had sent off to all his utility undertakings in which he had drawn attention to the incident at the electricity power station at Bury St Edmunds. He said quite definitely that we regarded this as an act of enemy sabotage, and had made some reference to spies being at large. RSLOs felt that the electricity undertakings would undoubtedly take this letter to the Chief Constable and ask him for his views. The Chief Constable would then go to the RSLO and ask why it had been thought desirable to communicate the information to utility undertakings which had not been given to the Chief Constables. They would want to know whether it was true. Was the RSLO to lie or take the Chief Constable into his confidence? The general opinion at that stage seemed to be that it might be a wise move to take the Chief Constable into our confidence if he approached the RSLO but not otherwise. The matter however was left in abeyance.

  However, the issue did not fade away, as probably everyone hoped, and was brought to the attention of Petrie, who was unamused by Rothschild’s initiative. By telling the RSLOs about the true nature of the operation, he had placed them in an invidious position as they acted as MI5’s official link to the police. If that relationship was to be based on a lie, implying that the Chief Constables were not fully trusted, then they were in danger of being undermined, thereby potentially compromising future cooperation:

  I had a meeting with the Director-General, Jasper Harker, Victor Rothschild, Alan McIver and T.A. Robertson about Plan BUNBURY. The Chief Constables are to be told if they approach the RSLOs that the incident is a special exercise. They are to be asked to keep up the deception with the utility undertakings. I am to visit Colin Robertson, the Chief Constable of Suffolk, and explain the position. There is to be no publication in the Police Bulletin. The D-G was rather annoyed about the letter to the utility undertakings being sent out without prior reference to himself. The fact is, however, that the normal way is for a utility undertaking to report to the Central Electricity Board who immediately send teleprinter messages to all their power stations in the country. Moreover, if we are out for publicity which we have so far not been able to get, there is bound to be a reproach by Chief Constables to RSLOs. The only unfortunate thing about the letter to my mind is that there is something about spies being at large, and it is perhaps a little too positive.

  Nevertheless, despite the internal friction caused by BUNBURY, MI5 remained keen to exploit the situation and generate some media interest, as Liddell noted on 18 August when Len Burt was authorised to adopt unorthodox tactics to attract the newspapers:

  I had a talk with Len Burt about BUNBURY. There is to be publicity in today’s press. Burt pretended to get tight in a pub and had leaked to one of his more disreputable contacts and he has now protested to this contact that he has been let down. In the light of this publicity the Director-General has agreed to reverse instructions to RSLOs, provided they have not already been approached. Jasper Harker subsequently ascertained that the field was clear. RSLOs were told that if the Chief Constable approached them they were to say that equipment known to have been used by the enemy was employed and that the matter was still under investigation. If they referred to the letter to utility undertakings they are to be told that this was ‘toned up’ a bit to make the undertakings more security-minded.

  This led Liddell and Rothschild to visit the Chief Constable, and make a clean breast of the situation:

  I went down to see Chief Constable Colin Robertson with Victor Rothschild and I explained to him all the various phases of BUNBURY and our difficulties. He told me that in spite of this morning’s publicity in every paper, not one question had been put to him about BUNBURY at a Chief Constable’s meeting he had attended. He expected everybody to come up and say ‘Now give us the lowdown about the sabotage at Bury’ but not a word. He was I think pleased we had paid him a visit. He was in thorough agreement with the policy of saying nothing to Chief Constables, and entirely agreed with Len Burt’s view that quite a number of them on receiving the information would hold a mother’s meeting. He was quite prepared to face his own superintendent if he ever found out. He explained to me how difficult it would be to get the searchers to find the unexploded bomb. He pretty well had to push their noses right into it before it was discovered. It looked just like a part of the old unused generator.

  Although the two MI5 officers succeeded in mollifying the Chief Constable, the issue was raised the next day at Scotland Yard, where Special Branch detectives expressed their well-founded suspicions:

  When visiting Special Branch, Langdon was confronted by Albert Foster, Charles Gill, and four inspectors with the announcement of Plan BUNBURY. They said ‘Whatever your views are about this case, we have come to the conclusion that it is either SOE or Lord Rothschild.’ I am afraid Langdon did not put up a very good show. Although he did not commit himself positively, I think he left them with very little doubt about the origin of the outrage. Amongst other things he is reported to have told them to keep it to themselves, which is of course a complete admission of guilt.

  This scenario, in which MI5 sought to deceive Special Branch, was exacerbated on 20 August by Len Burt, himself a former Scotland Yard detective, though never a member of Special Branch. Apparently he had no compunction in assuring Foster that the sabotage had been genuine:

  Len Burt has seen Albert Foster and considerably shaken him on the question of the genuineness of BUNBURY. Burt gave it as his opinion it was a true bill.

  Having committed itself to perpetuating the lie, it began to spread, and the following day another RSLO, Peter Hope, sought Liddell’s guidance:

  Peter Hope has got a reaction from the Assistant Superintendent in Newcastle about Plan BUNBURY. He has been told to stick to the line given to him for communication to the Chief Constable.

  On 24 August Liddell was obliged to address the dilemma yet again:

  Alan McIver came to see me about an enquiry about Plan BUNBURY that Hughes had received from the local Security Control Officer. I said that I thought Hughes should tell the SCO exactly what he had told the Chief Constable, otherwise he was putting the SCO vis-à-vis his subordinates in the same difficulty as the Chief Constable would be placed. This meant a further spreading of the information.

  There the matter rested until early in September when the question arose about how the Home Office should refer to BUNBURY in the monthly Police Bulletin, which was circulated routinely to all the regional police forces:

  Wells has raised the question of putting something in the monthly Home Office police report on the subject of Plan BUNBURY. He is reluctant to do this because he feels it wrong that the Home Office should mislead the police in an official document. I pointed out to him that we had faced up to this question long ago and made up our minds that in spite of the difficulties the question of the possible leakage of the truth had to be the first consideration. I discussed this matter with T.A. Robertson and Victor Rothschild. We eventually decided that provided Hughes did not think that the Suffolk police would be astonished not to read of the incident in the bulletin we should leave it out, and give a directive to RSLOs to the effect that they should if asked, explain to Chief Constables that the item had not been put in owing to the inconclusive nature of the investigation. Wells said that the Executive did not always put cases into the Bulletin and that they could therefore defend themselves in this particular case. He also said that the Bulletin was generally read by the head clerk who took an intelligence interest in a matter of this sort and would almost certainly bring it to the notice of the Chief Constables. Hughes telephoned later to say that he did not think that the omission of the BUNBURY item in the Bulletin would cause comment from the local poli
ce. It was therefore agreed that with the Director-General’s approval this line should be adopted and RSLOs if approached should say that the case had been omitted owing to its inconclusive nature.

  A month later the Sunday Chronicle published an innocuous story about BUNBURY, and that was the final word on the matter which, to everyone’s relief, could now be laid to rest.

  * * *

  Perhaps the most remarkable item in Petrie’s report is the reference to Violet Trefusis, who was Virginia Woolf’s lesbian lover and a well-known figure in London’s literary circles. Evidently she had engaged in an illicit correspondence with a well-connected French friend in German-occupied Paris, and this had come to MI5’s notice through ISOS and a letter intercepted by Postal Censorship. The contact was allowed to continue, as Liddell mentioned in his diary:

  A letter has been thrown up by Censorship from the son of General Louis de la Pellouse in Occupied France, to a Mrs Trefusis in London, inviting her to come to Portugal for discussions and giving her a cover address for her reply. It was clear that this letter was written on the instructions of the German secret service, the whole matter being reflected in ISOS. It was possible that this was some form of peace feeler. Mrs Trefusis is known to be pro-Vichy in her sentiments. The letter has been allowed to go on and arrangements made to intercept her reply. The cover address used is a well-known German collecting centre.

  There was no further mention of this contact, either by Liddell or Petrie, so presumably Mrs Trefusis did not take up the suggestion of a visit to Lisbon.

  SECOND REPORT

  A. Spies Detained

  (1) STEINER

  Frank Steiner, a well-trained Belgian agent of the German Secret Service arrived in this country on 5 April 1943. The Security Service was already in possession of considerable information about him from Most Secret Sources, but he made our task easier by voluntarily disclosing his connection with the enemy to the British authorities in Lisbon. Since his arrival in this country he had enthusiastically supplied the large quantity of valuable and detailed counter-espionage information in his possession. He was moreover given by the Germans a new means of receiving further instructions, namely code messages sent over the Calais broadcasting station. The possibility of using him for double-cross purposes is being investigated.

  (2) MENEZES

  The Portuguese Government has put in a strong plea that the death sentence pronounced against Menezes should be commuted. The Security Service do not wish to stand in the way of such commutation, but it is assumed that the Portuguese Government would in return be ready to follow up actively the information supplied to them partly as a result of the Menezes case, and round up the circle of German and Italian agents still thriving in Lisbon.

  B. Double-cross Spies and Saboteurs

  (1) ZIGZAG

  The double-cross saboteur ZIGZAG returned to his German Secret Service station via Lisbon, travelling as steward on a British ship. On arrival he was given by the local head of the German Sabotage Service a high explosive bomb camouflaged as a piece of coal with instructions to place it in the ship’s bunkers in order to sabotage the ship. ZIGZAG accepted the bomb, but immediately informed the master of the ship, who kept the bomb in a place of safety.

  (2) HAMLET

  An Austrian subject, who has been in contact with the German Secret Service in Lisbon, was sent to this country with our knowledge on April 4th. Under our direction he had been working for Koessler, a German Jew who is a member of the German Secret Service in Lisbon but who has in fact been double-crossing his German masters. In addition to Fanto, Koessler is supposed to have another agent in this country, who is notional and whose letters will be written by us, and, further, five agents in America, all of whom are also notional. Fanto is a very close personal friend of General von Falkenhausen, and he reports that the General and his staff are convinced that Germany will lose.

  (3) METEOR

  This Yugoslav was asked by the Germans to work for them in the UK and was given a novel type of instructions. He was told to inform the British authorities in Madrid that he was being sent to England as a spy and that he was prepared to work for the British in double-crossing the Germans. For a period he was to follow exactly the orders given him by the British, but at a later stage he was to receive new instructions from the Germans together with a proper mission, new cover addresses and another secret ink by which he could communicate with the Germans without our knowledge. He has, however, told the whole story to the British authorities.

  C. Sabotage

  (1) German sabotage plans for Gibraltar

  We have now arranged for one of our own agents to be appointed head of the German Sabotage Service operating against Gibraltar. It is hoped that he will be able to persuade the Germans to let him report direct to the German Secret Service station at Algeciras, which would provide us with an independent check on the activities of that station as they are revealed to us in Most Secret Sources. It is believed that the whole of the German Sabotage organisation operating against Gibraltar is now on our side, though still paid for their faked explosions by the Germans.

  (2) German Sabotage Equipment

  Photographs are attached of two specimens of the type of camouflaged bomb which the Germans attempt to introduce into such places as Gibraltar or smuggle on to our merchant ships in Spanish ports. The first shows a Thermos flask in which the genuine thermos only occupies the top few inches, the rest being filled with an incendiary bomb containing a time clock capable of being set up to twenty-one days. The second shows what appears to be a can of oil, which is, however, in reality filled with Thermit with a timeclock housed in the filler cap.

  (3) PLAN BUNBURY

  There is in being a plan to build up the two Norwegian agents who were sent here in 1941 as saboteurs. They are been instructed by the enemy to try and sabotage electricity miles, and the undertaking at Basingstoke has been chosen by us as the least important in the area in which they are operating. Having announced to the Germans that they would try and damage this, they were told that in due course proper materials for sabotage would be sent to them by parachute, and in view of the importance which appears to be placed on the project, the possibility of doing a bogus act of sabotage in the power station is being investigated. If this is not practicable, the Germans will be told that the attempt has also failed.

  D. Possible Peace Feelers

  Most Secret Sources together with a Censorship intercept reveal that the German Secret Service in Paris has arranged for correspondence to be set up between a person in France, probably the son of a General Vicomte Louis de la Panouse, and Mrs. Denys Trefusis in London. A letter was later intercepted to Mrs Trefusis inviting her to meet the writer in Lisbon to discuss matter affecting the best interests of Britain and France. The phraseology of the letter suggests that the subject to be discussed may be some form of Peace feeler. The letter has been allowed to go on to Mrs. Trefusis, and arrangements have been made for intercepting her reply.

  E. Political Cases

  (1) CRAVEN

  On 14 March 1943 William Frederick Craven, an ex-British Union detainee, wrote a letter to the German legation in Dublin, in which be declared that his sympathies were with the Germans and that he hoped for a German victory. He also sent his best wishes to his friends in Germany, particularly to Herr Reinhardt, a former German Consul in Liverpool who was removed from his post on account of his espionage activities. Craven was charged and convicted under the Defence Regulations on two charges, getting the maximum penalty on each, namely Penal Servitude for life on one, and 14 years on the other. He has appealed, but his appeal has not yet been heard.

  (2) Ben Greene

  The action brought by Ben Greene against Sir John Anderson, claiming damages for wrongful imprisonment on the ground that the order for his detention was made in bad faith, ended on the 9th April, 1943, by the plaintiff abandoning the action and unreservedly withdrawing the charge of bad faith.

  During the earlier p
roceedings before the Advisory Committee, MI5 were pressed, contrary to well established principle, to disclose the names of two of their agents on whose testimony the grounds for Ben Greene’s detention largely rested. Later, one of these agents was inveigled into the office of Greene’s solicitor, to whom, on being questioned, he denied the truth of the charges against Ben Greene which depended on his information which he had given, so as to avoid admitting by implication he was an MI5 agent. A further hearing of Greene’s case took place before the Advisory Committee, who, failing to appreciate the agent’s real reason for retraction, submitted him to a most severe cross-examination and finally wrote him down as utterly unreliable. As a result Ben Greene was released and the charges against him which rested on this agent’s testimony were formally withdrawn by the Home Secretary.

  In the suit just mentioned Ben Greene’s Counsel were so unwise as to call this agent, who, under examination by the Attorney-General, convincingly explained his motive for having lied to the solicitor, and was dearly doing so to affirm that his original evidence was true. At the commencement of the fifth day’s hearing and before the agent could go on to tell the jury all he knew about traitorous conversations, leading Counsel for the plaintiff intimated that the action would be withdrawn, thereafter judgement was given for Sir John Anderson with costs.

  The ignominious collapse of this case has been very satisfactory to MI5 since the reliability to their agent who had been so fiercely assailed and disparaged was vindicated in open court. The immense trouble and expense of the proceedings have also pointedly confirmed the unwisdom of any departure from the established and till now inviolable practice of never disclosing the names of their agents.

  I. Security of Services and other wireless signals

  As a result of information obtained by the Security Service from a German spy who recently came over here with the intention of working for the English, it has been discovered that the Germans rely to a very large extent for their intelligence on the interception of wireless messages sent in this country. A strong recommendation has therefore been put up to the Chiefs of Staffs that a thorough investigation should be immediately made into the security of wireless communications used both by the Services and by such bodies as the Police and Post Office.