by Jim Wilson
In Paris Stephanie was increasingly becoming involved in problems which upset the French government. One issue that French ministers were particularly concerned about was her persistent campaigning for a revision of the Treaty of Trianon, with a view to Hungary being restored to its former size and power. It flew in the face of the French government’s alliance with Czechoslovakia, Yugoslavia and Romania – known as ‘The Little Entente’ – a policy which as far as the French government was concerned was designed to contain a resurgent Hungary, the very opposite of what the princess and Rothermere were working to achieve.
The former Berlin journalist Bella Fromm, who in the 1930s wrote for the prominent German newspaper the Berliner Zeitung and had high-level contacts which made her well placed to know the truth, insisted in an unpublished memoir years later that Princess Stephanie had been expelled from France because of her espionage activities. British intelligence files, only declassified and deposited in the Public Record Office in Kew in 2005, disclose the truth. In 1933, the year after she left Paris to take up residence in London, and the year Hitler gained power in Germany, the British secret service circulated a government report stating that files had been found in the princess’ flat in Paris showing she had been commissioned by the German authorities to persuade Rothermere to campaign in his newspapers for the return to Germany of territory and colonies ceded at the end of the First World War.10 She was to receive the then massive sum of £300,000 (equivalent to some £13 million today) if her mission succeeded. Meanwhile, the princess was on the verge of concluding a separate deal with Rothermere to become his representative or ‘fixer’ in Europe on a retainer of £5,000 a year (£200,000 at today’s values), plus additional payments for each assignment she carried out.
She had finally secured the role she had aimed for back in 1927. Via the mouthpiece of Rothermere’s newspapers, she would be in a prime position to influence British politics and British government policy. The arrangement also gave her the opportunity to influence Rothermere’s personal views, which since 1930 had been strongly in support of the rise of Hitler’s National Socialists, and steer him closer to Hitler’s inner circle. Regardless of her loyalties, playing both sides in a ‘game’ of international politics could potentially be very lucrative for her. And this was convenient, because in 1932 the Great Depression following the Wall Street Crash caught up with her. She was heavily in debt. At one time, according to her son, she had been worth some $4 million, a colossal sum at that time. Now she seriously needed to economise and to find a new and regular source of income.11
As was so often the case in Stephanie’s life, she was dealt another ace. The luxurious Dorchester Hotel in London’s Park Lane was newly opened. Its first manager had also been manager of the Hotel du Palais in Biarritz, where she had frequently stayed. Recognising that having a princess as a guest would help to attract the right sort of clientele to his new hotel, the manager offered the princess cut-price terms if she would stay there instead of Claridge’s, her usual base when she was in London and where she frequently met Annabel Kruse. Stephanie settled into a magnificent apartment on the Dorchester’s sixth floor. It had a private entrance to Park Lane, a massive sitting room overlooking Hyde Park and four bedrooms. Her latest beau, an American banker by the name of Donald Malcolm who had studied at Harvard and Oxford, also moved from Paris to London with her, joining her at the Dorchester. Malcolm was a genius in the field of finance and he took over managing and boosting her finances. It was Malcolm who advised her to negotiate a contract with Rothermere.
Clinching the contract was not difficult to achieve. She reminded Rothermere of the success of her intervention over Hungary, and persuaded the press baron to appoint her as his emissary in Europe. She argued – and this was undoubtedly true – that she had the contacts to gain admittance to many of Europe’s most powerful people, and that she could open doors to almost every exclusive social circle on the Continent. Hoping to build on his initial success in raising Hungary’s profile, and desirous to restore the Hapsburg monarchy, Rothermere now instructed Stephanie to make contact with the ex-empress Zita, widow of the last Austro-Hungarian emperor, and also with Admiral Horthy, Regent of Hungary. Rothermere was an ardent monarchist; his argument was that a monarchic constitution was the best bulwark against Bolshevism and his hopelessly optimistic ambition was to restore both the Hapsburg and Hohenzollern thrones. In reality, following war in Europe, the cause of both monarchies was beyond revival. When neither of Stephanie’s missions showed any chance of success, he next instructed her to seek a meeting with the exiled ex-Emperor of Germany, Kaiser Wilhelm II.
This was a simple assignment for her. She was a close friend of the kaiser’s eldest son, Crown Prince Wilhelm; indeed, they had been flirting for years. Crown Prince Wilhelm, who unlike his father had not been condemned to exile, lived at Potsdam outside Berlin and had been a member of the Nazi Party since 1930. In 1933 he had joined the party’s paramilitary wing. As a result of the princess’ visits to him on Rothermere’s behalf, and probably influenced by her arguments, the Crown Prince sent Rothermere a crucial letter, dated June 1934, from his office in the Unter den Linden in Berlin. It praised the actions of Hitler’s new government: ‘The rearmament of the nation was recognised as a necessity,’ he wrote. ‘The withdrawal from the League of Nations and from the Disarmament Conference announced to the world at large the determination of the new German government, behind which for the first time the whole nation was concentrated, not to tolerate any longer being treated as a second-class people.’12
The Crown Prince said his respect for, and confidence in, the personality of the Führer had gown month by month. His personal relations with Hitler were moreover friendly and enjoyable. He made it clear that he thought Hitler had come to power at the right psychological moment. The people had faith in the National Socialist movement following all the humiliations of the peace treaty of Versailles, the senseless destruction of Germany’s entire war material, the degrading war reparations which had burdened the people with insane debts, and the subsequent inflation which had ruined the most valuable parts of the nation. While the letter expressed some concern for the views and influence of Goebbels, the Reich Minister for Propaganda, in all other respects its support for Hitler and his policies must have been music to Princess Stephanie’s ears. It would prove crucial in her efforts to persuade Rothermere to put the powerful influence of the Daily Mail behind Hitler and the Nazi Party.
6
A FRIEND IN BERLIN
A growing number of people in England in the early 1930s agreed with Lord Rothermere that the Treaty of Versailles had been excessively harsh on Germany. Many who shared the press baron’s views on Bolshevism were also obsessed by a fear of the spread of Communism. They argued that Germany, if released from some of the more humiliating terms of Versailles, could be an important bulwark against Bolshevism and the growing power of Russia. Meanwhile, Rothermere’s own political views were becoming increasingly nationalistic and right wing. In 1929, disillusioned with the mainstream Conservative policies, he joined with fellow press baron Lord Beaverbrook to form the United Empire Party. Rothermere urged the Tory Party to dispense with its leader Stanley Baldwin and replace him with Beaverbrook. He also argued for the reform of the House of Lords to make it possible for peers to be elected to the Commons. But the row he stirred up backfired. It divided Conservative voters to such an extent that the Labour Party won the 1929 election.
As early as September 1930, when the National Socialists had just emerged in Germany as a major party from the Reichstag election, Rothermere published in the Daily Mail an article extremely supportive of Adolf Hitler. It was headlined ‘A Nation Reborn’ and Rothermere, someone who always preferred to seek evidence first hand and see for himself before committing his views to print, had travelled to Munich to gain information about what he described in the article as ‘the beginning of a new epoch in the relations between the German nation and the rest of the world’.1 He
could not have imagined how correct he would be in terms of Germany’s impact on the outside world. But the impact would be far more devastating and destructive than Rothermere could possibly have imagined at that time. He wrote:
What are the sources of strength of a party which at the general election two years ago could win only 12 seats, but now, with 107, has become the second strongest in the Reichstag, and whose national poll has increased in the same time from 809,000 to 6,400,000? Striking as these figures are, they stand for something far greater than political success. They represent the rebirth of Germany as a nation.
Rothermere pointed out that the great majority of those who had voted for the National Socialists were between the ages of 20 and 30. He welcomed the fact that the new trend represented the values and the resurgence of youth. Whatever his views on Hitler and his Nazi Party, as a press proprietor and journalist he was uncannily prophetic. When the majority in Britain, including those in government, were indifferent to or ignorant of it, he realised the crucial significance of what was happening in Germany.
In September 1930 the New York Times was reporting on Rothermere’s pro-German views, saying that the newspaper proprietor was urging the British government to ‘examine diligently the potential sources of conflagration which are smouldering beneath the present peaceful surface of Europe’; it warned that to make enemies of the younger generation in Germany would mean that sooner or later there would be another terrible awakening facing the European nations.2 So when Hitler swept to power in 1933, Rothermere wanted to meet and get the measure of the man who was now Germany’s chancellor. He gave the task of engineering that meeting to Princess Stephanie. Surprisingly, he was aware that she had been publicly accused of being a spy, as he certainly had not been when he commissioned her to undertake assignments for him. But Rothermere refused to believe the slurs about her activities in the Continental press; indeed, he thought he had sound reasons not to believe them.
In December 1932 a number of European newspapers had carried allegations of espionage against her. One published the sensational headline: ‘Princess Stephanie Hohenlohe arrested as a spy in Biarritz.’ It transpired that the story had originated in the French newspaper La Liberté. The following day, Christmas Day, the same newspaper carried a further report: ‘Le Mystère de Biarritz.’3 Other European newspapers followed with reports referring to her as a ‘political adventuress’, even ‘the vamp of European politics’.4 La Liberté asked, ‘Is a sensational affair about to unfold?’, alleging that she had been arrested by agents of the Sûreté Nationale because of political activities harmful to France.5 But as Stephanie had not spent a single day in Biarritz during 1932, had given up her villa there and had sailed for New York at the time she was alleged to have been arrested in the French resort, it was reasonable for Rothermere to believe there was not a shred of truth in it. It is now clear from declassified British intelligence papers that both the French and British secret services had evidence which pointed to the accuracy of at least some of those allegations, although the facts as presented in the newspapers at the time were wrong. Indeed, British intelligence had had serious suspicions about the princess’ motives and her true allegiance since 1928, and they had been routinely intercepting the princess’ correspondence and tracking her movements in and out of the country from 1928 onwards.6
The declassified files show clearly that she was a target of British intelligence during the decade from 1928 until war broke out in 1939. Copies of her intercepted letters have been removed from the heavily weeded files, and a number of pages continue to be withheld under a section of the Public Records Act of 1958, invoked as recently as May 2004. But there is enough in the records of the British secret service to show that the monitoring of her communications and movements was extensive. As early as April 1931 the Foreign Office was questioning the condition of the princess’ residence in Britain, as she was suspected of having connections with highly placed Germans, including the Crown Prince, eldest son of the kaiser, who was known to be an ardent Nazi sympathiser. The FBI also suspected her of being a Nazi agent. Those suspicions were summarised in great detail in a lengthy memorandum dated October 1941.7 French intelligence, the Deuxième Bureau, informed the British secret service in August 1938 that, in their opinion, the princess was in all probability an important German agent. They further commented that they found this curious, since according to their information she was of Jewish origin.8 Stephanie, against all the evidence, for years robustly contested her Jewish parentage and the claims that she was involved in espionage. On many occasions before and after the Second World War she said she would publish her memoirs and prove these allegations to be entirely false, but she never did.
An indication of how seriously MI5 treated her during the latter half of the 1930s can be gauged from the fact that while MI5 were certainly alert to the potential dangers of Oswald Mosley and his Blackshirts, and indeed had infiltrated the British Union of Fascists, at no time were any Home Office warrants issued to monitor Mosley’s correspondence and his movements. In contrast, warrants were repeatedly issued throughout those years, covertly, against Princess Stephanie. What is surprising is that the British government never seem to have warned Rothermere of their suspicions. As a prominent newspaper owner he clearly had contacts in the highest levels of government. Why so influential a person in public life, with powerful organs of the media in his power, was not tipped off by MI5 is a mystery. Presumably they had sound reasons.
Stephanie turned to Rothermere for advice on how she could clear her name over the damaging newspaper reports. Rothermere’s response was it was better for her to do nothing about it. Anything she did would only make matters worse and would lead to people believing there was indeed substance in the stories. He had been in the newspaper business long enough, he said, to realise that a denial usually resulted in merely refreshing the story, and was likely to stir up new rumours. His advice was to let the matter lie. Her friends would know it was untrue after all. Rothermere also appreciated that further publicity could be extremely damaging to him as well. But Stephanie would not let the issue drop. As long after the original publication as July 1936, Rothermere was writing to her to say ‘the libels were of such a preposterous character that my lawyers advised me that you and myself should treat them with the contempt they deserved’.9 Stephanie remained dissatisfied, although it appears she never considered suing in the French courts to clear her name. Her belief that Rothermere should have done more to squash the 1932 allegations formed part of the notorious court case she pursued in the High Court some weeks after the Second World War had begun.
The story of the princess’ secret life refused to die, however. In January 1933 an article headlined ‘Fairy Tales around Princess Hohenlohe, Franco-Polish Intrigues’ appeared in a major German newspaper. The report stated that the princess, whom some French newspapers had reported had been arrested in Biarritz, had now arrived in Southampton aboard the liner Europa and had immediately travelled to London. She had spent the month of December in New York, the paper explained, and was exceedingly put out by the reports that had appeared in the ‘chauvinist’ French press. ‘It would appear that the whole story is an intrigue,’ the article went on, ‘instigated by Poland against the Princess.’ The report added that the princess was being held responsible for the editorial policy of Lord Rothermere who, in a series of articles in the Daily Mail, had argued for the return of the Polish corridor to Germany. It went on to allege that during Rothermere’s stay in Berlin, the princess was repeatedly seen in the company of his lordship, with whom she was on ‘close’ terms, and she had also been in the company of leading German politicians. But again, the reports were basically untrue. Rothermere, at that point, had not been in Berlin, nor indeed had Stephanie. But as is so often the case, there was no smoke without fire, even though some of the details of the press reports were inaccurate.
Writing forty years later, her son, Prince Franz Hohenlohe, said that the ugly label �
�spy’ turned out to be a persistent one.10 The mud stuck, and his mother’s subsequent work for Rothermere did little to help remove it. His account says that the evil wrought by the ‘irresponsible news stories’ pursued his mother for the remaining decades of her life; though the majority of her friends remained steadfastly loyal to her throughout. ‘People remembered the accusation, not the denial,’ he wrote. Had he, or her friends, had access to her British intelligence files, they may not have been quite so unquestioning. Rothermere now realised it was totally unrealistic to believe, as he previously had, that the restoration of any of the old and now defunct monarchies of central Europe could be seen as a way of assuring the integrity of post-war countries and guaranteeing their stability. Instead of placing his faith in a restoration of the old Hapsburg and Hohenzollern thrones, he now turned his attention to the new dictators. They were becoming, he believed, the guarantors of future peace in Europe: Mussolini in Italy, and now with his appointment as chancellor, Hitler and his National Socialists in Germany.
In July 1933 Rothermere wrote probably the most famous of his pro-fascist Daily Mail editorials, hailing Hitler’s rise to power in an article headlined ‘Youth Triumphant’, and captioned ‘from somewhere in Naziland’.11 Rothermere wrote of the Germans: ‘There has been a sudden expansion of their national spirit like that which took place in England under Queen Elizabeth. Youth has taken command.’ His editorial praised the regime for what it had achieved both in ‘spiritual’ and ‘material’ terms. Germany, he wrote in a subsequent article, had been ‘liberated’ by Nazism from ‘the rule of the frowsty, down-at-heel German republic … where fraud and corruption had begun to spread on a large scale’. He continued:
