by Curt Gentry
In his June 3, 1940, diary entry, Adolf Berle wrote, “…to J. Edgar Hoover’s office for a long meeting on coordinated intelligence. We agreed that we would set up a staff that I have been urging, plans to be drawn here…We likewise decided that the time had come when we would have to consider setting up a secret intelligence service—which I suppose every great foreign office in the world has, but we have never touched.”24
In his conversations with Roosevelt, Berle, and particularly his own aides, it was obvious that Hoover was aiming at a specific goal, which was nothing less than expanding the Federal Bureau of Investigation into a worldwide intelligence-gathering organization.
Unfortunately for Hoover, others had similar ideas. And because of their secret planning, Hoover would lose that much coveted prize, to none other than William “Wild Bill” Donovan.
With the outbreak of the war in Europe, the FBI had cut its liaison with British intelligence, in compliance with a mandate from the State Department which maintained that any form of collaboration would infringe on U.S. neutrality.
With tons of badly needed shipping threatened by the activities of German agents in the Western Hemisphere, the British, and in particular Winston Churchill, were especially anxious to reestablish a close working relation with U.S. intelligence, and for this purpose in the spring of 1940 William Stephenson (code name Intrepid) was sent to the United States to approach the FBI director.
A mutual friend, the boxing champion Gene Tunney, provided the introductions. Hoover listened attentively as Stephenson presented the British proposal. The argument was made even more convincing by Stephenson’s disclosure that a code clerk in the American embassy in London—the domain of Ambassador Joseph Kennedy—had been intercepting communications between Roosevelt and Churchill and turning them over to the Germans.
Hoover responded by saying that although he would welcome working with the British, he was prohibited from doing so by the State Department mandate: “I cannot contravene this policy without direct presidential sanction.”
“And if I get it?” Stephenson asked.
“Then we’ll do business directly,” Hoover replied. “Just myself and you. Nobody else gets in the act. Not State, not anyone.”
“You will be getting presidential sanction,” Stephenson told him.
Another mutual friend, Ernest Cuneo, was chosen to approach Roosevelt. According to Cuneo, the president responded enthusiastically, telling him, “There should be the closest possible marriage between the FBI and British intelligence.”25
If Roosevelt put his approval in writing, the document has never surfaced. More likely, his permission was oral.* Even at that, it was a politically dangerous act: given the isolationist sentiment at the time, had the agreement been made public, it could conceivably have resulted in an impeachment attempt and would almost certainly have been used against Roosevelt in his 1940 reelection bid.
Operating under the guise of a British trade commission, Stephenson set up the British Security Coordination (BSC), their cooperation at this early stage being so close that Hoover himself suggested the name. Although its headquarters was a small suite—Room 3606—in Rockefeller Plaza in New York, at its peak about one thousand persons worked for the BSC in the United States and about twice that number in Canada and Latin America. Its largest single operation was in what seemed a most unlikely location, Bermuda. However, all mail between South America and Europe was routed through there, including diplomatic pouches, and the BSC set up a mammoth, highly sophisticated letter-opening center, complete with code breakers, the fruits of which it shared with the FBI.
It was an odd marriage—the British quickly realized that Hoover was an Anglophobe†—but for a time it worked. During 1941 alone, the BSC provided the FBI with over 100,000 confidential reports. Better yet, from the FBI point of view, Stephenson, who didn’t want any publicity regarding his activities, was quite content to let Hoover claim full credit for British successes.
It is possible to pinpoint exactly when the marriage went sour: it occurred on July 11, 1941, when Roosevelt appointed William Donovan head of the Office of the Coordinator of Information (COI).
Though classmates at Columbia Law School, Donovan and Roosevelt had been neither social equals nor friends. In 1932, during his unsuccessful bid for the governorship of New York, Donovan had even campaigned against FDR. However, as the situation in Europe worsened, John Lord O’Brian convinced the president that his much traveled protégé would be a good choice for any “special assignments” he might have, and Roosevelt, intrigued by the idea, sent Donovan on a number of secret missions, including several to Great Britain, where—circumventing the defeatist Joseph Kennedy—he dealt directly with Winston Churchill and other high British officials.
Aware that Donovan provided direct access to the American president, William Stephenson quickly “co-opted” him. Donovan was given an inside view of British intelligence, with special emphasis on code breaking, sabotage, counterespionage, and psychological and political warfare. Stephenson also convinced Donovan that the United States was badly in need of its own coordinated, worldwide intelligence agency. Donovan, armed with accurate and impressive military intelligence provided by the British, in turn convinced Roosevelt; and in July 1941—much to the displeasure of Hoover and his rivals in the State Department, Army, and Navy—the president appointed Donovan chief of a new organization called the Office of the Coordinator of Information (COI), a year later renamed the Office of Strategic Services (OSS).
Although he did everything in his power to oppose Donovan’s appointment, Hoover was partly responsible for it. For months the FBI director had been battling with General Sherman Miles, head of Army intelligence, over which of their organizations had what intelligence authority. The president, Richard Dunlop has noted, “exasperated by the intransigence and narrow-minded bickering of Miles and Hoover, decided that an integrated strategic intelligence service was long overdue,” and adopted the Donovan-Stephenson plan.28
“You can imagine how relieved I am after months of battle and jockeying in Washington that our man is in position,” Stephenson cabled London.29
Well aware of Stephenson’s efforts on Donovan’s behalf, Hoover stopped cooperating with the BSC. He continued to use its reports, sending them on to Roosevelt as if they were his own, but, as the British soon discovered, it was now a one-way street.
“The FBI in its day-to-day working relations were always superbly helpful,” the BSC’s Herbert Rowland recalled. “Hoover only began ordering his department heads to cut us off after he saw Roosevelt had bought Stephenson’s arguments for an integrated and co-ordinated intelligence service.”30
Lieutenant Commander Ewen Montague, the “dirty tricks” expert on Stephenson’s staff, saw it coming. Hoover, Montague recalled, “wanted to publicize everything to enhance the FBI’s reputation. We dared not confide to him certain plans for fear of leaks. Our methods depended on concealment. This made Hoover most distrustful. A ghastly period began.”31
Even at that, the BSC fared better than Donovan’s new organization. On orders from Hoover, specially selected FBI agents infiltrated the fledgling COI, some later rising to key positions in both the OSS and its successor, the CIA. Since the FBI was charged with conducting background investigations of all COI/OSS applicants, Hoover knew the identities of Donovan’s agents, many of whom were kept under surveillance. One of Hoover’s closest allies in Washington, Mrs. Ruth Shipley, who ran the U.S. Passport Office as her own fiefdom, had the passports of Donovan’s supposedly secret operatives stamped “OSS,” until a complaint to the president stopped the practice. Hoover, who had first opened a file on Donovan back in 1924, when he was his nominal superior in the Justice Department, now added to it reports on his security lapses,* financial dealings, and numerous extramarital involvements. Whenever Donovan or his men made a serious mistake—and former COI/OSS officers admit there were many such—Hoover fired off a memorandum to the White House. For example, acti
ng on their own, OSS agents broke into the Japanese embassy in Lisbon, Portugal, and stole a diplomatic codebook—unaware that U.S. intelligence had already broken the code. With the discovery of the loss, the ciphers were changed and Donovan added to his growing list of bureaucratic enemies the Joint Chiefs of Staff.
Even relatives of OSS officials did not escape Hoover’s attention. In 1942 a Polish college professor applied for a job with the FBI as a Russian translator. FBI surveillance revealed that he was carrying on an affair with Eleanor Dulles, sister of Allen and John Foster, the pair having met secretly three times a week (every Tuesday, Saturday, and Sunday) for five years, and Hoover rejected him for this reason. Donovan, to whom Hoover’s enmity was the highest recommendation, quickly hired him, remarking, “We need Russian analysts more than Hoover does.”†33
All too often Donovan made himself an easy target. His hiring practices, for example, were sloppy at best. Ernest Cuneo recalled that once Donovan requested a special entry visa for a man he’d hired, but that Hoover had blocked it. The problem, Donovan told Cuneo, was that the man had committed “a few youthful mistakes.” Cuneo approached Attorney General Biddle, who said he was sure the youthful escapades could be overlooked. Cuneo had scarcely returned to his office when the telephone rang and Biddle ordered him to get right back to the Department of Justice. The FBI director was with the attorney general when he arrived. “A few youthful mistakes?” Biddle uncharacteristically shouted. “Tell him, Edgar!” Hoover read the man’s rap sheet, which included two convictions for homicide in the first degree, two manslaughters, and a long list of dismissed indictments.35 Hoover made sure such incidents received wide circulation in the intelligence community.
An even greater sin, as far as Hoover was concerned, was Donovan’s attitude toward Communists. He’d hire anyone, he often said, if he’d help get the job done. Time and again, when Hoover informed him that an applicant was a known or suspected party member, Donovan hired him anyway.
Although he saw to it that his adverse recommendations were on record, Hoover did not publicize these incidents. He saved them for later.
Hoover’s attempts to discredit Donovan placed the BSC in an almost untenable position. As the BSC official Donald Downes observed, “The no-man’s land between the FBI and OSS was dangerous territory.”36
Adolf Berle, Hoover’s closest ally in the State Department, was opposed to the BSC. He confided in his diary, “No one has given us any effective reason why there should be a British espionage system in the United States.” In an attempt to sever the link between the OSS and the BSC, Berle proposed that the BSC deal exclusively with the FBI. Learning of this, British intelligence assigned an agent named Paine to “get the dirt” on Berle. Alerted to the plot, Ed Tamm warned the assistant secretary of state. Hoover and Tamm also called on Stephenson and told him they wanted Paine out of the country by six o’clock “or else.” Professing “surprise and horror that any of his men should do such a thing,” Stephenson had Paine on a plane to Montreal that same night.*37
Nor was Berle the FBI director’s only ally. Hoover also secretly backed a bill by his one-time enemy Senator Kenneth McKellar which would have greatly restricted the operation of foreign agents—friendly or otherwise—in the United States. Moreover, it would have transferred the monitoring of their activities from the State Department to the Department of Justice, and made them open all their records to the FBI. Donovan, acting on behalf of Stephenson, went directly to FDR and persuaded him to veto the bill. An amended version, which the president later signed, exempted the BSC.
Roosevelt had no intention of hampering either the OSS or the BSC. They were far too useful. He utilized both to conduct a number of secret operations which he either did not wish to entrust to Hoover or which he felt the FBI director might refuse. Stephenson, for example, was the moving force behind a campaign to discredit the isolationist Burton K. Wheeler, BSC agents having collected information which revealed that one of the senator’s aides had used the congressional franking privilege to disseminate Nazi propaganda.
Unable to outlaw the BSC, Hoover now extended it only token cooperation. British visitors to FBI headquarters were given a chilly, though formally correct, reception, as Commander Ian Fleming discovered when he and the director of British naval intelligence visited the FBI director. Fleming found Hoover to be “a chunky enigmatic man with slow eyes and a trap of a mouth who received us graciously, listening with close attention (and a witness) to our exposé of certain security problems, and expressed himself firmly but politely as being uninterested in our mission.”
“Hoover’s negative response was soft as a cat’s paw,” Fleming recalled after the war. “With the air of doing us a favor, he had us piloted through the FBI Laboratory and Record Department and down to the basement shooting range. Even now I can hear the shattering roar of the Thompsons in the big dark cellar as the instructor demonstrated on the trick targets. Then, with a firm, dry handclasp we were shown the door.”39
The British agent Dusko Popov, the man said to be the model for Ian Fleming’s James Bond, received an even less cordial reception—with tragic consequences to the United States.
The playboy son of a wealthy Yugoslav family, Popov had in early 1940 been approached by the Abwehr, the German high command’s espionage service, and asked to become a spy. He immediately reported the overture to British counterintelligence, MI-6. Following intensive training by both the Germans and the British—his German code name was Ivan and his British Tricycle—Popov became one of Britain’s most successful double agents, the misleading information he fed the Nazis resulting in a number of major intelligence victories.
In the summer of 1941 the Abwehr arranged for Popov to go to the United States. Supplied with the Abwehr’s latest paraphernalia, including the “microdot”—a process whereby a page of text was photographically reduced to the size of a period or comma, then inserted into an innocuous communication—Popov was given two assignments. He was to set up a large-scale espionage ring; and he was to carry out a very important mission for the Japanese. The latter, Popov had been told, was “of the highest priority.”
Before leaving for the United States, Popov reported to MI-6. His British handlers were especially interested in the Japanese questionnaire, which was one of the microdot documents he’d been given.
J. C. Masterman, chief of the British XX (Double Cross) Committee, received a copy of the questionnaire on August 16, 1941. Carefully examining it, Masterman noted that one-third of the questions dealt with Hawaii and, particularly, Pearl Harbor. He also observed that whereas all the other questions were general or statistical, those regarding Pearl Harbor were specific. For example, the questionnaire asked for “Details about naval ammunition and mine depot on Isle of Kushua [Pearl Harbor]. If possible sketch…Where is the station for mine search formations? How far has the dredger work progressed at the entrance and in the east and southeast lock? Depths of water? …Exact details and sketch about the situation of the state wharf, of the pier installations, workshops, petrol installations, situation of dry dock No. 1 and of the new dry dock which is being built.” The questionnaire also asked for sketches showing the exact locations of installations at “Wickam” (Hickam), Wheeler, Luke, and “Kaneche” (Kaneohe) airfields.40
Masterman concluded, “It is therefore surely a fair deduction that the questionnaire indicated very clearly that in the event of the United States being at war, Pearl Harbor would be the first point to be attacked, and that plans for this attack had reached an advanced state by August 1941.”41
Popov, and the British, also had other information which not only supported this conclusion but indicated how the attack might be carried out. Another double agent, a friend of Popov’s, accompanied by the German air attaché in Tokyo, had recently escorted a group of Japanese naval officials to Taranto, Italy. Their primary interest, Popov had been told, was in determining exactly how, in one sneak attack, using torpedo planes launched from an aircraft c
arrier, the British had nearly obliterated the Italian fleet.
On his arrival in the United States, Popov was met by Percy Foxworth of the FBI’s New York office, to whom he explained the secret of the microdot and turned over the Japanese questionnaire and other materials.
Popov then waited for FBI permission to set up his bogus espionage network. It was a long wait. In the meantime he resumed his playboy life-style. Using money supplied by the Germans, he rented a penthouse on the corner of Park Avenue and Sixty-first Street, where he resumed a long-standing affair with the French actress Simone Simon. When she returned to Hollywood, Popov wasn’t lonely. A former SA assigned to the New York field office said, “As I recall—and I recall it quite clearly—Popov was partial to twins, but, lacking a matched pair, often made do with a couple other accommodating ladies.”42 Little they did escaped the attention of the FBI. Popov complained to another British agent, “If I bend over to smell a bowl of flowers, I scratch my nose on a microphone.”43
“Mr. Hoover is a very virtuous man,” Foxworth warned Popov, in preparation for his long-delayed meeting with the director. Foxworth could have added, but didn’t, that the director was also not pleased that the double agent frequented his favorite haunt, the Stork Club, where his munificent tips earned him and his female companions entry to the Cub Room.
The meeting was brief. The FBI didn’t need the help of foreign spies, the director told him: “I can catch spies without your or anyone else’s help.” He also accused Popov of being “like all double agents. You’re begging for information to sell to your German friends so that you can make a lot of money and be a playboy.”
There was no mention of the Japanese questionnaire or of the microdot, the discovery of which Hoover believed so important that on September 3, 1941, within days after Popov’s arrival, he’d sent a “strictly confidential” report on it to the White House.44 And, following the war, the microdot was the subject of one of his many ghost-written Reader’s Digest articles, called “The Enemy’s Masterpiece of Deception.”
