Operation Valuable Fiend

by Albert Lulushi

  On October 8, all the Egyptian newspapers carried a story that the Ministry of Interior had refused exit visas to King Zog and his suite pending settlement of a tax claim and a decision regarding gold found in his villa. A detailed estimate valued Zog’s gold at twenty thousand Egyptian pounds, approximately sixty thousand dollars at the time,4 or about nine times that much in today’s dollars.5 The story stated that Zog had failed to submit a currency declaration upon his entry into Egypt. The director of the General Income Tax Section in the Ministry of Finance was quoted as saying that Zog could be considered a tax evader and liable from one month to three years’ imprisonment and/or a maximum fine of one thousand Egyptian pounds. Ambassador Caffery, commenting upon the incident, called it “the latest in a series of maneuvers to scare Zog into parting with some of his gold.”

  On October 16, an embassy officer met with the Egyptian vice premier Nasser and asked why Zog was not allowed to pay a tax settlement and leave Egypt. Nasser replied that his government had attempted to collect taxes from Zog, but he had denied tax liability. And, because Zog had not made a proper customs declaration when he brought in his gold, the Egyptian government legally could confiscate it. The embassy officer pointed out that because Zog had entered Egypt as a guest of the then reigning monarch, confiscation of Zog’s gold would seem neither just nor ethical; he added that Zog had been helpful to the West in opposing Communist domination of Albania, which had gained him friends in the US, where he owned property. The embassy official added that anything resembling persecution of Zog by the Egyptian government would probably be unpopular in the US and adversely impact Egyptian prestige there.

  Then Nasser, seemingly improvising, proposed a complicated scheme for resolving the impasse: if the US were to buy Zog’s gold in Egypt, paying him in dollars in the US, the US could sell the gold to Egyptian banks for Egyptian pounds, which then could be used to pay for US government expenses in Egypt. When informed of Nasser’s suggestion, Ambassador Caffery commented that he hoped the CIA would be able to accomplish the proposed transaction discretely. After studying the proposal, the State Department eventually decided not to pursue it because it was a complicated transaction without precedent, and, from a diplomatic viewpoint, it was insulting to the US government. It also had the potential to hurt US prestige and could be used by hostile press to paint the State Department as supporting a villain.

  On October 21, at the request of the CIA, Ambassador Caffery again asked the foreign minister about Zog and urged restraint and moderation on the part of the Egyptian government. At the same time, Caffery advised the CIA station chief in Cairo that he could go no further on Zog’s behalf. As he put it:

  Zog’s present plight would seem to be, to a considerable extent, of his own making, particularly since, despite the obvious turn of events, he chose to overstay his time in Egypt. If he had left some time ago before the Egyptian Government withdrew its diplomatic recognition of Albania, he would undoubtedly have been spared his present troubles. The Embassy will continue its informal efforts to resolve the present difficulties but there is obviously a limit to the intervention which can be profitably undertaken on his behalf.6

  Caffery explained that on several occasions he had made the point with the Egyptian authorities that any discrediting of Zog would be against the Free World’s interests and he had requested the Egyptian government to permit Zog to leave Egypt with his property and his dignity unimpaired. However, Caffery was reluctant to use more pressure, because he felt that the US influence ought to be reserved for paramount policy objectives, such as finding a settlement to the Egyptian-British-Israel issues. After intervening five times without success on Zog’s behalf, Ambassador Caffery wrote that, short of physical coercion or threats “inappropriate to the importance of the Zog affair relative to other area issues,”7 there was not much else the US government could do to influence the manner in which the Egyptians were handling the matter.

  * * *

  Negative stories continued to appear in the press almost daily. On October 30, Agence France-Presse claimed that Zog, Queen Geraldine, and ten members of their suite who had allegedly “participated actively in the clandestine commercial operations of the former King” had been placed under police surveillance until they appeared before a Cairo court. The Alexandria Reformer of November 2 reported that Zog’s residence had been raided the day before by the police, who seized arms, including three revolvers that were licensed and two machineguns, four shotguns, and eight pistols that were unlicensed.

  At the same time, the CIA station in Cairo received a report from a reliable source indicating that the minister of state, Fathi Radwan, and Revolutionary Commanding Council member Anwar Sadat were working under guidance from the Soviet legation in Cairo to discredit King Zog to the point where he could no longer be a threat to the Hoxha regime.8

  Other reports indicated the possibility that the Communists, fully aware of Zog’s engagement against the Tirana regime, were making a concerted and deliberate effort to discredit and intimidate Zog. A friend of Queen Geraldine in the US wrote to Ambassador Caffery stating that Zog’s Long Island estate had been damaged by Communists. Then, on November 5, a Franciscan priest who visited Queen Geraldine regularly reported that at their last meeting she had expressed fear for the life of her son, stating that Zog had learned that Communist agents had recently arrived in Alexandria and that they might attempt to kidnap the boy.9

  The moves of the Egyptian government against Zog furnished the Albanian Communist press good material in its propaganda against the king and the Albanian emigrant community in general. In its broadcasts of November 9, Radio Tirana quoted Zëri i Popullit (People’s Voice), the newspaper of the Albanian Communist Party, as stating that Zog’s “frauds” are nothing new to the Albanian people who know him as a “bandit, adventurer, and a traitor.” Bashkimi (Union), the newspaper of the Democratic Front of Albania, stated that “Zog, an individual without principles and morals,” has had as his sole aim his own enrichment and that of the “clique” surrounding him. As a leader of Albanian “traitors and criminals” abroad, the paper continued, he and his followers constitute reserves for the American-British espionage. It is not accidental that their next place of residence will be the United States, stated Bashkimi.10

  * * *

  King Zog’s situation continued to deteriorate. On December 22, he was ordered to appear for trial on January 4, 1954, where he would be charged with tax evasion and with evasion of customs duties at the time of his entry into Egypt in 1946. CIA officers involved in the case felt that the agency needed to take further actions to dissuade the Egyptian government from proceeding with Zog’s public trial and probable conviction, which would seriously reduce his prestige as an anti-Communist leader and strengthen the propaganda of the Albanian Communist regime and other Communist countries. Having exhausted all other possibilities, the CIA decided to make a high-level liaison approach to Vice Premier Nasser in the hope of dissuading the Egyptian government from further public humiliation of the former monarch.

  Miles Copeland, the CIA chief of station in Cairo, met with Nasser on the morning of January 4 and pointed out to him, in the name of the director of Central Intelligence, the potential damage to the Free World that would come from the discrediting of Zog by a continuation of the Egyptian proceedings. He did not argue the merits of the case or reveal the CIA’s clandestine relationship with Zog. Instead, he stressed that the mutual US and Egyptian interests required denying “further grist to the worldwide Communist propaganda mill.” During the discussion, Copeland was careful not to commit the prestige of the DCI to the release of Zog; he indicated that US interest was not in Zog the man but in Zog the symbol of resistance to Communist domination of Albania.11 Nasser explained apologetically that it was too late to cease entirely the action against Zog, but he promised that he would do all he could to minimize such action.12

  The Zog hearing before the Egyptian customs court was held later that afternoon as
scheduled. Zog personally was not required to appear. His lawyers protested that the customs claim of ten thousand pounds Egyptian was “outrageous” and requested the court to overrule the customs administration. The court took the matter under advisement and set a new hearing for May 1. Zog was free to post a deposit of ten thousand Egyptian pounds against the final judgment and depart, obtaining a refund if the subsequent ruling was favorable. Copeland urged Zog to settle his customs case either by payment or deposit, apply for exit visas and permission to export his gold and jewelry, and leave Egypt without delay.13

  But only a few days later the Egyptian authorities ordered the dissolution of the Muslim Brotherhood and the mass arrest of its leaders, blaming them for an assassination attempt on Nasser. The newspaper Le Progrès Egyptien on January 15 reported that Zog and his entourage were on the Ministry of Interior’s blacklist and were prohibited from leaving Egypt. The CIA station, concerned over the possible closeness of Zog’s relationship with the Muslim Brotherhood, believed that if the Egyptians had or could obtain concrete evidence of his involvement with the brotherhood, Zog’s chances of leaving Egypt would be considerably lessened. Horace W. Fuller, a retired US Marine Reserve brigadier general who had taken over from Gordon Mason as the CIA’s chief of external operations in Athens, traveled to Egypt and met with Zog on February 3 to discuss the entire situation with him.14

  According to Zog, the tax officials’ inquiry of January 28 to 30 had discovered no irregularities and, as a result, his lawyers as well as the Egyptian officials expected full tax clearance papers within fifteen days, which would enable him to depart from the country. Zog estimated he would have approximately eight thousand Egyptian pounds’ worth of gold coins remaining after the payment of debts, taxes, and customs. Apart from this sum and his family jewels, he had no other means of support. Regarding his alleged involvement with the Muslim Brotherhood and other anti-regime personalities, Zog asserted that his contacts had been infrequent and purely social, denying any interference with Egyptian internal or external affairs.

  Fuller told Zog that the Americans were making every possible effort to assist him and facilitate his early departure to the US. He advised Zog that the special entry arrangements made by the CIA covered only himself and nine members of his family; the balance of his entourage had to go through normal entry and immigration procedures. Zog agreed to avoid publicity and press conferences en route to the US and to make no derogatory statements concerning the Egyptian government and its treatment of his case. Fuller also asked Zog to destroy, burn, or return to him every paper describing any of Zog’s interactions with CIA up to that point.15 At the end of the meeting, Fuller obtained Zog’s signed statement covering the points of their discussion.16

  Despite the assurances given Zog in January 1954 that he could expect clearance to depart Egypt within fifteen days, at the end of February Zog reported that his passport was still at the Ministry of Interior and his gold and jewels still impounded. Now the Finance Ministry required proof that he had not purchased his Long Island estate with money exported from Egypt. Zog was sure this was yet another excuse to hold him and expressed anxiety about the real reason for the latest move by the Egyptian authorities.17

  The Egyptian customs administration held another hearing of Zog’s case on March 4. The tax officials stated that Zog’s bank balance in Egypt was insufficient to cover the claim against him of ten thousand Egyptian pounds and requested permission to seize other properties. The court granted a postponement of the case to March 22.18

  After other postponements, on May 20, the Egyptian court ordered the release of all Zog’s assets in fifteen Egyptian banks.19 It took several more months until Zog finally received the exit visas for himself and his entourage. He booked passage to France and left Egypt immediately afterward.

  CHAPTER 16

  Planning the Fondest Dream

  In December 1951, a small group of analysts led by Rear Admiral Leslie C. Stevens, the Joint Chiefs of Staff liaison with the CIA, had begun drafting a strategic plan for cold war operations for the Psychological Strategy Board (PSB). The PSB was a committee set up by presidential directive on April 4, 1951, to coordinate national psychological warfare objectives, policies, and programs across agencies in the US government.1 Board members included the undersecretary of state, the deputy secretary of defense, and the director of Central Intelligence, or their designated representatives.2 DCI Walter B. Smith, intent on curtailing the autonomy that the Office of Policy Coordination had enjoyed up to that point, had insisted that the PSB assume the responsibility of providing the CIA with guidance on the conduct of covert operations and become the approval body for covert action.3

  In May 1952, the group considered including in the strategic plan the goal of detaching Albania from the Soviet orbit. Everyone remembered that the OPC had considered this action since the first months of its existence, in an effort to disrupt and deny the use of Albania by the Communist side as an operating base of guerrilla warfare against Greece and possibly Yugoslavia. The priority of attention and effort with respect to Albania had dropped sharply with the end of Greek guerrilla hostilities in 1949. Nevertheless, since the CIA was still active in the area, the PSB asked it to submit an analysis of pros and cons for such an action. Wisner and his team prepared the analysis, and Allen Dulles, the CIA’s deputy director for plans at the time, presented it to the board on June 4, 1952.

  In the event of a general Soviet attack, Wisner wrote, Albania had to be cleaned up in order to remove the threat to the Adriatic and to eliminate the dagger at Tito’s back. The resources required to accomplish this objective were not that significant. Admiral Robert Carney, commander in chief of NATO forces in Southern Europe, believed that he could knock out Albania in fairly short order by aerial bombardment. Tito had consistently taken the position that his forces could overrun and clean up Albania within two weeks. But such resources, no matter how small, would need to be diverted at the moment when everything might be required to fend off Soviet assaults elsewhere. Not having to face this trade-off in a war situation, Wisner emphasized, was the most significant argument for a cold war effort to detach Albania from the Soviet orbit.

  The list of arguments against the coup included the fact that providing for the economic requirements of Albania after its liberation would place an additional strain on the US resources. Wisner wrote:

  From a purely cold-blooded point of view, it might be better for us to concentrate all efforts to further disorganize and hamstring the tottering Albanian economy, thus leaving the Russians with the unhappy alternative of pouring in resources of their own or allowing the fate of a rotting and desperate Albania to appear before all the world as further evidence of what happens to countries and peoples within the Soviet orbit.4

  As a final, but considerably significant point against an Albanian coup, Wisner pointed at the amount of effort that such a program would involve and the extent to which it would reduce CIA’s capabilities of attacking other and perhaps more useful targets.5

  On November 26, 1952, the PSB finalized its paper, entitled “A Strategic Concept for a National Psychological Program with Particular Reference to Cold War Operations under NSC 10/5,” which outlined a number of useful ways to erode Soviet power and influence. Regarding covert operations, the PSB recommended placing the greatest emphasis in three broad areas:

  First, weakening of Kremlin control over the internal assets of the Soviet-controlled bloc, and increasingly occupying the Kremlin with problems within this area.

  Next, direct action to reduce subversive Soviet influence in those areas of the free world that were most immediately threatened by it.

  Last, covert manipulation of key elements in unstable countries of the free world to increase the stability and utility to the objectives of US foreign policy of those countries.

  Within these three broad fields of activity, the PSB highlighted several actions that should receive greater emphasis. One of them was the detachment
of Albania from the Soviet orbit, considered feasible because of Albania’s unique geographical position and desirable to demonstrate that the Soviet influence in the world could be held in check and even diminished. The principal advantage to be gained from this would be its psychological effects both in subjugated countries and in areas under intense Soviet pressure; secondary benefits included military advantages from the removal of Soviet forward operating bases in the Mediterranean and improved security of Albania’s neighbors, especially Yugoslavia and Greece.

  The PSB cited preliminary estimates indicating that Albanian personnel could accomplish the detachment without the overt participation of Western military forces. Ignoring the most recent analysis of the CIA, which clearly leaned against intervening in Albania, the PSB directed the agency to make a detailed plan specifying each step such an action would require up to its successful completion, including time phasing, logistics, estimates of personnel and material requirements, together with plans for meeting them.6

  * * *

  The task for preparing the plan fell to the Paramilitary Operations branch of the CIA’s new Directorate of Plans, created by the merger of the OPC with the OSO in August 1952. Under the direction of Brigadier General John Weckerling, former chief of US Army Intelligence, staff officers worked in “crash” mode to prepare the plan at a level of detail sufficient to satisfy the PSB requirements. On February 6, 1953, Weckerling provided a detailed paramilitary plan for a coup d’état in Albania supported multilaterally by the US, UK, and Yugoslavia. The plan called for a bare minimum of fifteen months of preparations before reaching sufficient readiness to launch the coup; Weckerling suggested eighteen months to two years as a far more desirable time to prepare.

  During this period, the State Department would negotiate agreements to incorporate the Yugoslav-sponsored League of Albanian Refugees into the National Committee for Free Albania under joint US-UK-Yugoslav control and turn NCFA into an instrument for the creation of a new provisional government in Albania. Yugoslavia and Greece would agree to allow paramilitary operations to be launched and supported from bases in their territories, including assembling, equipping, and training over ten thousand Albanian personnel who would carry out the initial phase of the coup. The Yugoslav and Greek armed forces would prevent land and aerial reinforcement of Albanian opposition forces by Soviet or satellite nations moving through or flying over their territories during the coup; in return, the US and UK would give military support to Yugoslavia and Greece in the event of invasion of these countries by Soviet or satellite forces. In addition, US naval forces would conduct maneuvers near the mouth of the Adriatic when the coup started in order to discourage Soviet or satellite forces from sending reinforcements by sea.