A Brief History of the Spy

by Paul Simpson

  The purpose of Operation Phoenix was to root out supporters of the Viet Cong, otherwise known as the National Front for the Liberation of South Vietnam. The Viet Cong wanted to ‘overthrow the camouflaged colonial regime of the American imperialists’, and to all intents and purposes were carrying out the wishes of the North Vietnamese government in Hanoi. They carried out acts of violence and terrorism against government employees and anyone assisting those they regarded as the enemy, which at times could include medical personnel.

  The Viet Cong carried out what became known as the Tet Offensive in early 1968, attacking more than a hundred towns around South Vietnam. They even mounted a commando raid on the US embassy in Saigon. They hoped that an urban uprising would follow, but it didn’t, and between forty thousand (the US estimate) and seventy-five thousand (the Viet Cong’s own figure) of their own troops were killed, as compared to around six thousand American and South Vietnamese. Although this was presented as a major defeat for the Americans by the anti-war media in the States, it was equally devastating for the Viet Cong, whose infrastructure was weakened, and numbers depleted to such a level that they were unable to ever fully regroup: ‘We failed to seize a number of primary objectives. We also failed to hold the occupied areas. In the political field we failed to motivate the people to stage uprisings,’ the Viet Cong themselves admitted. However, as Richard Nixon pointed out: ‘Though it was an overwhelming victory for South Vietnam and the United States, the almost universal theme of media coverage was that we had suffered a disastrous defeat. The steady drumbeat of inaccurate stories convinced millions of Americans that we had lost a major battle.’

  Operation Phoenix had already been in existence prior to the Tet Offensive, but went into overdrive afterwards. Created as the Intelligence Coordination and Exploitation Program as part of the general Civil Operations and Revolutionary Development Support program (CORDS), it was quickly renamed Phoenix (or Phung Hoàng in Vietnamese). MACV Directive 381-41 of 9 July 1967 established it with the aim of attacking with a ‘rifle shot rather than a shotgun approach to target key political leaders, command/control elements and activists in the VCI’. In essence, it was similar to previous CIA operations, a struggle for the hearts and minds of the Vietnamese, so that they chose to turn against the Communists. It therefore needed to be carried out by the Vietnamese themselves.

  Oversight committees operating at national, corps and district levels agreed the framework within which the Phoenix teams could operate, and set quotas. At the provincial level were teams, usually comprised of trained South Vietnamese soldiers, who would ascertain who was involved with the Viet Cong, and ‘neutralise’ them. This didn’t necessarily mean they were killed: it was recognized that that sort of heavy-handed operation could be counter-productive, and of course, dead Viet Cong couldn’t provide useful intelligence. According to a CIA report in 1969:

  The Provincial Reconnaissance Unit (PRU) Program in South Vietnam forms an investigative and paramilitary attack upon the covert communist apparatus in South Vietnam. PRU teams, currently totalling approximately 4,200 men, operate in 44 provinces of South Vietnam. PRU are based in their home areas and operate in teams of 15–20 men. They are presently advised and supported by 101 US military advisors and seven CIA personnel. CIA funds the PRU and retains overall administrative control of the project for the US Government.

  The official remit of Phoenix was:

  … the collection of intelligence identifying these members; inducing them to abandon their allegiance to the VC and rally to the government; capturing or arresting them in order to bring them before province security committees or military courts for lawful sentencing; and as a final resort, the use of reasonable force should they resist capture or arrest where failure to use such force would result in the escape of the suspected VCI member or would result in threat of serious bodily harm to a member or members of the capturing or arresting party.

  The problem was that there were many occasions where those carrying out the Phoenix program went beyond their orders, leading to the belief that Phoenix was a cover for assassination (although obviously there was a grey area between targeted kills of Viet Cong operatives and assassinations.) Interrogations could be brutal — K. Barton Osborn, who was connected to Phoenix in 1968, described the techniques in graphic detail to a Congress subcommittee in 1971, and called Phoenix a ‘sterile depersonalized murder program… I never knew an individual to be detained as a VC suspect who ever lived through an interrogation.’

  The CIA wanted to pull out of the program and leave it in South Vietnamese hands as early as 1969, in part because it didn’t really fit with their intelligence-gathering mission any more. The program was run by William Colby, who had been Chief of Station in Saigon; it officially came to an end shortly after he returned to Washington as Executive Director of the CIA in 1971 and Congress began investigating the abuses. As far as Colby was concerned, despite the problems that he acknowledged had occurred, it was a success; as he explained in a 1981 television interview: ‘I have heard several references to North Vietnamese and South Vietnamese communists who account, who state that in their mind the most, the toughest period that they faced in the whole period of the war from 1960 to 1975 was the period from 1968 to ’72 when the Phoenix Program was at work.’

  The CIA was instrumental in assisting with information about prisoners of war being held during the Vietnam War. Future Vice-Presidential candidate James Bond Stockdale (yes, that really was his name) was shot down in September 1965 and spent the next seven years as a prisoner. During that time he developed a code that he used in letters home to his wife, which gave the identities of some of the men held with him. US Naval Intelligence originally handled communications with Stockdale, using a letter from his wife to secretly send him invisible carbon paper — although they warned him that if he was caught, he would be treated as a spy.

  Stockdale was able to send back lists of potential targets, prisoners held and information on the camp’s location, but when senior officers decided to back off from the project, noting that the POWs ‘have got it tough enough right now… The last thing we need to do is make them spies’, the Navy turned to the CIA. The Technical Service Department’s Bruce Rounds came up with a new code which Stockdale’s wife used for a letter in May 1967.

  Although the communications would lead to Stockdale’s brutal torture, they continued with other POWs, allowing families to find out about the fate of their loved ones. TSD agent Brian Lipton worked at night on the project which was kept secret from all but a very few at the CIA: it remained a classified secret even after the Vietnam War ended, with Lipton persuading now Rear Admiral Stockdale not to give up all the secrets in his autobiography. It was eventually revealed in a history of the Technical Services Division published in 2008, three years after Stockdale’s death.

  * * *

  The other key element of the CIA’s involvement in south-east Asia was Air America, the civilian airline owned by the Agency. This carried out multiple operations supporting the tribal groups, known as the Montagnards, who lived in the highlands between Vietnam and Laos, as well as mounting missions to rescue US pilots who had been shot down in North Vietnam. Between 1962 and 1975 Air America provided support to the Royal Lao Army and was used to transport anything and everything that needed to move around the area — from live pigs and cows during a famine, to Richard Nixon himself. According to some of its pilots, it was also involved in the opium trade (an accusation that gained credence with the release of a movie in 1990); it certainly was aware of the drugs trade, but its role was assisting in fighting the war against the communists, not policing narcotics.

  Air America’s own history points out that its crews were involved in many different varieties of mission:

  [They] transported tens of thousands of troops and refugees, flew emergency medevac missions and rescued downed airmen throughout Laos, inserted and extracted road-watch teams, flew night-time airdrop missions over the Ho Chi Minh trail,
monitored sensors along infiltration routes, conducted a highly successful photo reconnaissance program, and engaged in numerous clandestine missions using night-vision glasses and state-of-the-art electronic equipment.

  As the tide of the war in Laos turned against the Americans, Air America took heavy casualties. CIA Director Richard Helms decided to shut the operation down in 1972 once the war was concluded, but the final two years of service saw twenty-three Air America personnel killed. Although the operation’s reputation has been attacked, it is still regarded by the CIA as one of its finest. A plaque to those who served was unveiled at CIA Headquarters at Langley in 1988: ‘The aircrew, maintenance, and other professional aviation skills they applied on our behalf were extraordinary. But, above all, they brought a dedication to our mission and the highest standards of personal courage in the conduct of that mission.’

  8

  DISHONOUR

  The seventies were a time of disillusionment in the Western world. In Britain, Edward Heath’s administration struggled with industrial disputes, and his successor Harold Wilson believed that MI5 were organizing a coup against him. In America, the ignominious end of the Vietnam War came as a shock to the country’s sense of self-belief. Matters were made worse when President Richard Nixon assisted in the cover-up of a break-in at the Watergate building in Washington DC, and would have to resign two years into his second term of office rather than risk being impeached. Worries about the CIA’s links to that burglary, as well as revelations about operations apparently directed against the American people, prompted investigations into the agency’s conduct, and a great deal of dirty linen being washed in public. West Germany’s chancellor was forced to resign when his closest advisor was revealed as a Stasi spy. And at the end of the decade, the Soviet Army, assisted by the KGB, invaded Afghanistan.

  Not everything was doom and gloom. The decade began with a notable coup for MI5, who were able to arrange the expulsion of a ring of Soviet agents from the UK in Operation Foot, causing a major setback to Moscow Centre’s plans, not just in Great Britain but throughout the non-Communist world. In all, 105 agents were removed, which resulted in Soviet intelligence operations being severely hampered in the UK for the rest of the seventies.

  Operation Foot came about because of increasing concern on the part of MI5 through the sixties at the size of the Soviet intelligence set-up in the UK — even if some in government and the civil service seemed to think that the threat from the KGB was diminishing following the Cuban Missile Crisis. In November 1968, following pressure from MI5, the government restricted the size of the Soviet embassy, but the KGB and GRU simply added intelligence officers to the Trade Delegation. Sir Alec Douglas-Home, appointed Foreign Secretary in Ted Heath’s cabinet following the June 1970 general election, raised the issue with his counterpart, Andrei Gromyko, only to be told: ‘These figures you give cannot be true because the Soviet Union has no spies.’

  After some persuasion, the new Home Secretary, Reginald Maudling, wrote a joint memo with Douglas-Home on 30 July 1971 to the prime minister, warning that there were at least 120 Soviet intelligence officers (from the KGB or GRU) in the UK, and that they were causing serious problems. ‘If the cases of which we have knowledge are typical, the total damage done by these Soviet intelligence gatherers must be considerable,’ they wrote. ‘Known targets during the last few years have included the Foreign Office and Ministry of Defence; and on the commercial side, the Concorde, the Bristol ‘‘Olympus 593’’ aero-engine, nuclear energy projects and computer electronics.’ On 4 August, Douglas-Home sent a final warning to Gromyko about ‘inadmissible Soviet activities’.

  Operation Foot would have taken place in October had it not been for the defection of KGB officer Oleg Lyalin on 3 September. Lyalin had been providing information to MI5 since the previous April, revealing his role as the senior representative of Department V, the KGB’s sabotage and covert affairs section. According to the plans Lyalin was compiling, seaborne sabotage groups would land at Hayburn Wyke on the north Yorkshire coast (240 miles north of London) with airborne colleagues dropping in north of the Caledonian Canal to cause major problems for the British infrastructure. In addition, he had been the case officer for Sirioj Husein Abdoolcader, the KGB spy in the GLC motor licensing department; Abdoolcader was arrested two weeks after Lyalin’s defection.

  On 24 September, the Permanent Undersecretary at the Foreign Office, Sir Denis Greenhill, told the Soviet chargé d’affairs that ninety GRU or KGB officers were being expelled, and fifteen others who were in the Soviet Union at the time had their visas revoked. The following day Douglas-Home faced an angry Gromyko at the UN, who warned it was dangerous for Britain to threaten the USSR. Douglas-Home apparently burst out laughing and said, ‘Do you really think that Britain can ‘‘threaten’’ your country? I am flattered to think that this is the case.’ Gromyko complained about the ‘hooligan-like acts of the British police’ and expelled eighteen British diplomats, but the matter didn’t escalate. The success of Operation Foot led to MI5’s standing within the international intelligence community rising.

  KGB operations were hampered but not stopped altogether — in fact their key operative in the UK wasn’t affected by Operation Foot at all, since he was controlled from abroad. This was Geoffrey Prime, whose work at the British SIGINT headquarters at the Government Communications Headquarters (GCHQ) building in Cheltenham and elsewhere could have been much more damaging to British interests than it was, MI5 believed, had he been run by the KGB First Directorate, who handled most espionage operations. The Third Directorate, to whom Prime reported, weren’t used to handling such sensitive material. Even so, during his time at Cheltenham, the Russians suddenly changed their communications procedures, making them impenetrable to NSA and GCHQ analysts.

  Prime had offered his services to the Russians while stationed with the RAF in West Berlin in 1968 — leaving a message at a Soviet checkpoint, asking Soviet intelligence to contact him — and was encouraged by them to apply for a post with GCHQ. He would later claim that he worked for the KGB ‘partly as a result of a misplaced idealistic view of Russian Communism which was compounded by basic psychological problems’. Prime was a sexual pervert, whose interest in young girls would eventually lead to his arrest.

  During his work at GCHQ, Prime had access to intercepts that he would pass through to his Soviet controllers, using his own judgement as to what was important. Like many spies before him, Prime suffered from stress because of his double life, exacerbated by his sexual problems, and eventually, in 1977, he resigned from GCHQ, and went on to work as a Cheltenham taxi driver. The KGB left him alone for three years, before trying to reactivate him in 1980, but although Prime provided them with material he had obtained during his final few months at Cheltenham, he wasn’t willing to try to regain his old job. His espionage activities were only revealed after his arrest on child sex charges in 1982 when his wife handed over one-time pads and other spy equipment to the police. Prime was sentenced to thirty-eight years’ imprisonment (thirty-five for spying, three for the sex offences), of which he served nineteen. In an echo of the Rosenberg case, Prime was told by the judges that if Britain had been at war with the Soviet Union, he would have been sentenced to death.

  When the KGB began reactivating their agents, they discovered that one of their most important assets over the years was no longer in a position to help them, since she had retired! Melita Norwood’s long service to Communism passing over atomic secrets had been recognized with the Order of the Red Banner in 1958; she eventually collected it in Moscow in 1979. She had evaded detection by the Security Service in the UK over the years (‘a harmless and somewhat uninteresting character’ was the assessment in April 1966) and had been instrumental in recruiting other agents including a civil servant, code-named Hunt. He was reactivated in 1975 via a French agent, but according to KGB papers supplied by Vitali Mitrokhin when he defected in 1992, Hunt’s usefulness was pretty minimal, and an MI5 investigation conc
luded that it was unlikely that his activities caused any significant damage. That assessment was also applied to three other agents — a chemical engineer, a lab assistant, and an aeronautics and computer engineer — who were brought back into the KGB fold in the mid-seventies.

  The Soviets were able to get useful information from some agents during the decade. Code name Ace, aircraft engineer Ivor Gregory, was recruited for cash by the London residency in 1967, and was able to pass technical details on numerous planes, including Concorde, aero-engines and flight simulators, which enabled the Soviets to create their own versions. He died in 1982, although his treachery wasn’t discovered until a decade later.

  Michael John Smith, code-named Borg, was an electronics engineer, who received security clearance when reports of his earlier affiliation to the Communist party weren’t cross-filed properly. He started working for the KGB in May 1975 and in the three years before his security clearance was revoked, he was able to pass the Soviets vital information from his employment at Thorn EMI defence contractors on the then top-secret Project XN-715, developing and testing radar fuses for Britain’s free-fall nuclear bomb. His material was so good that the KGB suspected he was a double agent, and went so far as to test him with a non-contact polygraph during a trip to Vienna. However, the Soviets broke off contact after he lost his security clearance, until he changed jobs; then between 1990 and 1992, he supplied information from the General Electric Company. He was betrayed when his original case officer, Victor Oshchenko, defected in 1992; Smith was sentenced to twenty-five years’ imprisonment, reduced to twenty on appeal. Since his release, he has campaigned ‘to discover and expose the full story behind the conspiracy that led to my conviction of supposedly spying for the Russians in the early 1990s’, according to his blog.