by Larry Loftis
Another Lisbon officer was said to have died more swiftly. Supposedly stumbling while boarding a DC-3, the man had fallen into a spinning propeller. A witness testifying later claimed that three men had thrown him into the arc.
And German operatives were not the only hazard. America, France, Italy, Japan, and countless other countries sent their agents as well. Many hired locals as informers. Lisbon was a swarm of refugees and spies, rumors and lies.
Don’t worry about them, came the remark at the Palácio lounge one evening. They’re just a bunch of leg men. The one on the left tells Musso who’s here. The big fellow does the same for Himmler. The little guy keeps Goebbels supplied with English newspapers.
And on it went. Information was Portugal’s priceless commodity and bellmen, clerks, valets—anyone—could be on a country’s payroll. Even in the Allied-friendly Palácio the head waiter was Italian and thought to be working for the Italians or Germans.
Added to this incestuous nest was the local secret police. Like Casablanca’s Captain Renault, Lisbon’s Captain Agostinho Lourenço supervised an aggressive force—the Polícia de Vigilância e Defesa do Estado (PVDE). Desmond Bristow, an MI6 officer who described them as “over-zealous Germanophiles,” reported that they could be found at the airport, tram stops, and most hotel lobbies. While he was on assignment in Lisbon, Bristow recalled, an officer at Passport Control warned him about these “devils.”
One day, Bristow wrote in his memoirs, he was conversing on a tram island with Jona von Ustinov,* a Russian-German MI5 agent. Ustinov had offered a Black Russian cigarette and Bristow was attempting to light it between gusts of wind. Suddenly, he felt two hands grab him at the shoulders. “Senhor,” a secret policeman said, “please show me the license for your lighter. Here in Portugal, gentlemen, you have to have a license for a cigarette lighter.”
The British agents shrugged.
“Passports please, senhores; you are obviously foreign.”
From that moment on, Bristow remembered, the secret police followed them everywhere. For several days they would have up to five PVDE agents watching them as they dined, walked, and traveled about Lisbon and Estoril. When the agents suddenly disappeared, Ustinov was worried. “Better we see them seeing us,” he said, “because then we can all see together, but when not seeing them seeing us we might not see them seeing us doing what we are doing.”
Such attention compounded Dusko’s apprehension. On any given night he might be shadowed by a German or British agent, who himself was being tailed by PVDE. It was possible that Popov might have three tails, all watching as he entertained a female companion—who also might be a German spy.
Aviz Hotel, Lisbon, 1940.
Gulbenkian Foundation
But the PVDE controlled the music of the dance. Lourenço’s men filed extensive reports and based on what he read, the secret police chief decided which espionage activities he would allow, and which he would prohibit. In many instances—as several German and British spies and journalists discovered—a run-in with Lourenço resulted in a quick trip home.
It was from this hive of refugees, diplomats, spies, informers, and secret police that Dusko would collect his honey.
And implant his stinger.
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On November 22, 1940, he flew to Barcelona, spent the night at the Ritz, and the following day caught a Lufthansa flight to Lisbon. Per Abwehr instructions he checked in at the Aviz, the city’s most luxurious hotel and home to Calouste Gulbenkian, the world’s richest man.
Napoléon himself would have approved. The seventeenth-century French furniture, intricate ironwork, and mural entryways exuded aristocracy. The ominous crest looming on the building’s exterior, however—which was strikingly similar to the Imperial Coat of Arms of the German Empire—hinted at why Berlin had instructed Dusko to stay there: The Germans controlled it.
According to Popov’s memoirs, he called von Karsthoff and followed the “Schmidt” code; he was at the pickup spot on the Rua Augustus an hour early. The winking blonde appeared and moments later he ducked into an Opel. A few blocks later the driver let the girl out and then pointed the sedan west, toward Estoril.
Situated between the bustle of Lisbon and the cliffs of Cascais, Estoril was Portugal’s Riviera. As early as the turn of the century local officials had begun initiatives to transform the charming fishing village into a commercially viable resort. In 1910 a Portuguese physician had published in London a medical report espousing the therapeutic advantages of Estoril’s thermal springs and mild climate. Four years later Fausto de Figueiredo, the former president of Portuguese Railways, announced his vision of establishing Estoril as a tourist destination akin to the French Côte d’Azur. Although delayed in his work until the conclusion of World War I, Figueiredo set about his task vigorously, obtaining a betting license and overseeing construction. By 1930 his dream had been realized and Estoril boasted a world-class hotel (Palácio), an international casino, a glistening beach, gardens, a golf course, a thermal spa, and a complex of high-end restaurants, shops, and promenades. Advertising campaigns followed, and almost immediately Estoril was on the short list of “must visit” destinations.
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At the outbreak of World War II, German, British, and American diplomats and military attachés stationed in Lisbon saw no harm in enjoying all that Estoril offered, including its luxury hotels. While Axis personnel preferred Lisbon’s Aviz and Estoril’s Atlântico and Parque, the Allies preferred the Palácio. Those with considerable means and extended stays rented lavish villas in Estoril and Cascais, estates originally constructed to house visiting royalty.
Popov’s car was headed to one such estate, the Villa Toki-Ona. As the sedan crept into the garage, Dusko rose from his crouched position in the backseat as an attendant was closing the door behind them. Von Karsthoff was an imposing figure, not so much due to his physical presence, but because of his stature. Forty to forty-five years old, he was just under six feet, had dark hair and eyes, and looked more Italian or Spanish than Austrian. Well dressed and well educated, he spoke Italian, French, and some Portuguese. He also could read English and, as Johnny had warned, was very much Dusko’s equal—handsome, intelligent, charming.
Palácio Estoril Hotel.
And dangerous. Dusko would later describe his time with the major as “being in the company of a domesticated panther.” Slim and lithe, the major’s movements resembled those of a big cat, he recalled. At every moment, even in relaxed settings, the slightest mistake might rouse the creature to devour him.
Ludovico offered a drink and introduced a young woman, Elisabeth Sahrbach, his secretary. About twenty-five and with a good figure, Elisabeth was professional but cool. A fair-complected blonde, she wore no makeup but was nevertheless attractive. Dusko assumed she was the major’s mistress and made a mental note to win her over early.
Von Karsthoff’s villa, Dusko remembered, was Moorish, opulent, and boasted features necessary for any active spymaster: an enclosed garage, an interior stairwell, a high stone border, and within walking distance to the Palácio, the casino, and Estoril entertainment. Popov identified the property to MI5 as the “Villa Toki-Ona” and the “Villa Toki-Ana.” Cascais land records, however, contain no properties called “Toki-Ana.” A “Chalet Toki-Ona” on Bicesse, later identified as the “Vivenda Toki-Ona,” was most certainly von Karsthoff’s residence.
Not surprisingly, the property had a colorful history.
In 1923 a Luís Teixeira Beltrão filed with the authorities plans for a luxurious home at Estrada de Bicesse, Nº 31, a location which comports with the parcel later known as the Toki-Ona. The blueprints match Popov’s description of von Karsthoff’s residence in every detail: Moorish architecture, large—likely exceeding eight thousand square feet—and having an enclosed garage and interior stairwell. In May 1928 Beltrão notified the city that construction had been completed.
In 1936 an ad appeared in O Estoril for a property known as the Bom Refúgio, also on Estrada de Bicesse, which matched the construction plans filed by Beltrão. The property was sublet for a time as apartments, and the ad revealed the appeal: two hundred yards from the casino, luxurious accommodations, a spacious garden and garage. In all probability, the Beltrão property, the Bom Refúgio, and the Villa Toki-Ona were all one and the same.
In 1937 Beltrão sold the property to a Ms. Margot Seco de Topete, who appears to have returned it to single-family use. Margot de Topete, however, was not a Lisbon local; hotel registrations reveal that, although born in Paris, she was a Venezuelan national. She also was not living in the Bom Refúgio in 1939. On April 16 of that year she checked into the Palácio. The next day she was across the border, gambling at the French casino in Biarritz.
The day after that she was escorted from the country.
Ms. Topete, it seemed, was doing her part in the war—for Germany. An Associated Press release on April 18 carried the story:
FASCIST AXIS EMBLEM TORN FROM CLOTHING
Politically-minded patrons of a Biarritz casino ripped the jewel-embroidered letters, “R-O-M-E, B-E-R-L-I-N, T-O-K-Y-O,” from the gown of a stylishly dressed Venezuelan last night. . . . Intervention of a police commissioner enabled her and her companions to leave. The woman identified herself as Senora Margot Topete, widow of a Venezuelan general. With her were a group of young Spanish women and a German.
In addition to the gown letters, she was also wearing a belt with the three Axis powers prominently displayed. The story didn’t identify the German, but he may well have been von Karsthoff, or one of the major’s lieutenants. From May 25, 1940, to December 26, 1942, while Ludovico was renting the Toki-Ona, Ms. Topete lived at the Palácio. The Venezuelan evidently enjoyed gambling, and Casino Estoril patrons apparently were more tolerant of politically themed fashions.
In the meantime, von Karsthoff kept a low profile. Other than his listing with the German Embassy, his name—itself an alias—appeared nowhere, even though he rented several properties. He would expect Popov to observe the same level of secrecy; they would meet only after dark, and only after a car ushered Dusko inside the garage.
When they finished their drinks, the major concluded the meeting and Dusko left the way he’d come—hiding in the back of the sedan. The driver returned to Lisbon and dropped him off several blocks from the Aviz. Darting between moon-cast shadows, steps echoing down cobbled streets, Dusko hustled to the hotel. It was a scene reminiscent of a John Buchan novel.
What happened a few nights later, however, could only have been replicated in the sybaritic mind of Ian Fleming.
6
TOO MANY DEVICES
His second or third night in Lisbon, Dusko recalled, he emerged from the shower to find a beautiful girl in his room—in a silk negligee. He had seen her earlier at the Aviz but knew nothing about her other than her name—Ilena Fodor—which he had acquired from the front desk.
Somehow Ilena knew his name, and commencing with a kiss, she began asking questions about his origins, opinions, and why he was in Portugal. She was clearly a spy; Dusko’s only decision was whether to partake in the forbidden fruit. He made up stories about his origins and opinions, and told her he was in town for a client who had lost a Gaugin and two post-impressionist paintings. Ilena nodded, seemingly disappointed. Reclining, she opened her negligee, exposing half of Gibraltar. The ruse was so blatant it was annoying. Dusko sent her on her way.
Bem-vindo à Lisbon.
The Germans had upped their game and Popov would have to follow suit. A few days later he discovered that he had been right about Ilena. While he was visiting von Karsthoff and going over codes and questions, the major dryly suggested that Dusko “stop trying to find those post-impressionist paintings.” Ludovico had heard all about it, he said, and claimed that it was the work of Abwehr III, counterintelligence.
What he didn’t mention was the mind-boggling level of Axis infiltration in Portugal. Graham Greene, the English novelist who served with MI6, saw firsthand the daunting task facing the Allies. As head of the Portuguese desk in 1943, Greene assembled a notebook providing the names and activities of known Axis agents operating in the country. Greene’s report listed two thousand names. In addition, no less than forty-six companies doing business in the Iberian peninsula were considered covers for German espionage.
For his entire tenure in Portugal, then, Popov could be tailed, tested, or trapped by agents of Abwehr I, Abwehr III, the Gestapo, the SD, the PVDE, or informants of any.
The tightrope was long, taut . . . and invisible.
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Dusko knew he had to leave the Aviz, and on November 28, 1940, he transferred to Estoril’s Allied-friendly Palácio. His excuse was that the Aviz was too staid for his tastes; the fact that the Palácio was adjacent the casino and beach was merely incidental. Knowing of Popov’s penchant for entertainment, von Karsthoff made nothing of the transfer.
On December 5 Dusko received his visa for England but was unable to secure a seat on the KLM flight. He was also beginning to run short of funds. A few days later he cabled Johnny: “Still 5–15 waggons deliverable—send letter of credit immediately.” The number of wagons indicated his estimated days before departure. Hearing nothing back, he pressed von Karsthoff, who gave him $400. The major also delivered a questionnaire—verbally—for Popov’s trip to London. Dusko was to find out:
The people opposed to Churchill who were working for peace with Germany, and how to get in touch with them. He was to ascertain their hobbies and weaknesses—money, drink, women, etc.
The type of bombing attack most affecting the morale of the population.
The most effective kind of propaganda.
The class of the population most affected by propaganda and how they could best be approached.
The circle of people surrounding Vice-Admiral Sir John Tovey, Commander-in-Chief of the Home Fleet. Once identified, Dusko was to ingratiate himself with as many as possible.
The answers were to be sent, von Karsthoff said, via a new secret ink formula. In a wineglass three-quarters full of non-chlorinated water, Dusko would dissolve a few crystals. Dipping a steel nib into the solution, he was to write on a postcard to one of three cover addresses in Lisbon. Once received, Ludovico could read the message by placing a hot iron on the card. Once the paper turned brown, the secret writing would suddenly appear in black.
The major added that if the invasion came while Popov was still on the island, Dusko was not to be afraid. “When our troops are there, just ask to be taken to the Commander, tell him who you are, mention my name and everything will be all right. The Commander might give you new orders, just do what he tells you to do.”
If Dusko ran into difficulties or needed money, he was to telegraph a woman who would pass for his girlfriend: Maria Helena Barreto de S. Anna, Rua Donna Stephania 7b—4°, Lisboa. Maria was about twenty-two, he said, beautiful, and had a good figure. Von Karsthoff still had much to learn about his new spy; given Ludovico’s description, there was a good chance Dusko would contact her even if he didn’t need money.
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On December 20 Popov finally acquired a KLM ticket, the plane arriving at Felton Airport, near Bristol, around 6:00 p.m. At Immigration he informed the agent that he was visiting England on business for the Savska Bank of Belgrade. The officer stamped his passport, and Dusko made his way through Customs, where he was met by a wiry young man with jet-black hair and a pencil-thin mustache. The man whispered that his name was Jock and that he would be Popov’s driver. At the car Dusko met his MI5 escort, a Mr. Andrew.
Jock drove skillfully, Dusko remembered, but exceedingly fast. The Security Service, it turned out, had recruited well. The man’s name was St. John Horsfall, a professional race car driver and winner of the 1938 Leinster Trophy.
Driving an Aston Martin.<
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They arrived at the Savoy around ten o’clock, just as the Luftwaffe was setting the city aglow. Like Lisbon’s Aviz, Estoril’s Palácio, and Rome’s Ambasciadore, the Savoy was England’s best, famous for its French chefs and favorite guest—Winston Churchill.
The clerk handed Dusko the key to room 430 and someone from behind whispered Popov’s name. It was Major Tar Robertson, MI5’s B1A section chief and the man who would directly run him.
Trained at Royal Military Academy Sandhurst, Tar had been commissioned in the Scottish Seaforth Highlanders before joining Intelligence and often could be found in the office sporting his tartan trews. Winsome, Tar had twinkling eyes which were at once disarming and engaging—the kind that partied with you before words were spoken. “A born leader,” a colleague would say of him, Robertson possessed uncanny and perceptive judgment, traits critical for running enemy agents. Just three years older than Dusko, Tar was already an intelligence veteran, having joined MI5 in 1933.
Robertson introduced himself and over drinks explained what Dusko needed to know about B1A, and the overlap between MI5 and MI6. Since Dusko had not been vetted and remained a security risk, Tar did not reveal the puppet masters pulling the double-cross strings.
In the summer of 1940, MI5 and MI6, together with the military intelligence directors, had formed the Wireless Board (aka, W Board) to oversee all intelligence and counterintelligence. The members of the board were: Major General Stewart Menzies (head of MI6), Guy Liddell (director of MI5’s B Division, Tar Robertson’s boss), Admiral John Godfrey (director of Naval Intelligence), Air Commodore Archie Boyle, Major General F. C. Beaumont-Nesbitt (director of Military Intelligence), and the intelligence officer of the Home Forces. Before the end of September, however, the work of the W Board became too burdensome and Beaumont-Nesbitt suggested that the Board limit itself only to supervision of a subcommittee that could perform the daily chores.
