Art of Betrayal (40 page)

Did the British employ blackmail as well? There was a debate within the service about whether or not to follow Soviet methods. One of those opposed to its use was Gerry Warner. ‘I don't believe in blackmail for both moral and practical reasons. An agent who is working because he is being blackmailed, because he is being coerced into it, he – or she – is never going to be reliable. He has every good reason to betray you if he thinks he can get away with it … An agent who is being blackmailed has no reason to tell you the truth – he may make things up. He has no loyalty to either himself or to you so it is not a practical business and quite clearly it is not a moral business. If we had descended to the kind of practices that the KGB and GRU routinely practised there was no point in doing the job.'
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But there is evidence that blackmail was occasionally attempted. MI5 was said to have tried to ensnare a KGB officer in London by introducing him at a party to a high-class call girl who was on its books and then photographing him in the act and entering the room. But when the MI5 man confronted the naked Russian, he simply demanded to talk to his Embassy and refused to co-operate.
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‘Obviously a new recruit
is always going to ask the question “Do we blackmail people, do we seek to compromise them, do we seek to put pressure on them?” a chief of MI6 later claimed. ‘No is the answer … in 1923 an internal study of the service and the methods used by the service wrote, “an individual's vices are not played upon in order to obtain a hold upon him”. There you have it in one sentence. Do we use pressure? No we don't.'
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Vassall had been sufficiently important to be run by the KGB chief in London, the domineering Nikola Rodin. But the Soviet Embassy was not the only home for spies. There was another elite breed of KGB officer who truly operated out of sight. These were the famed Russian ‘illegals'. On 3 March 1955, the liner
America
docked at Southampton. One of those to disembark was a Canadian named Gordon Lonsdale. Well spoken, handsome and replete with cash, he used his connections as a member of a St James's club, the Royal Overseas League (patron: the Queen), to rent a top-end apartment just off Regent's Park. He then enrolled to take a course learning Mandarin at the School of Oriental and African Studies. But while other students spent their time struggling with the new language, Lonsdale found it all too easy. The reason was that he could already speak the language fluently. The course was simply cover, an excuse to find his feet in London and meet the many government officials also taking it. And Lonsdale was not really Lonsdale.

The real Gordon Lonsdale was most likely dead. He had been a Canadian whose Finnish mother had taken him to the Soviet Union. He probably died around the age of thirty. His death had been covered up by the KGB who had stolen his identity and given it to one of their most prized assets – a man called Konon Molody. Molody was born in Moscow and had been chosen for the life of an illegal. How early no one knows, but he was sent to California to learn English with an aunt when he was aged just ten. After returning to the USSR, he then went to Canada to familiarise himself with his new identity. He had holes drilled in his teeth and went to a specific dentist in Vancouver who would recognise the cavities. That he was a patient named Molody reciting a line from Heinrich Heine would confirm that he was the right person. The dentist then helped him use Lonsdale's birth certificate to get hold of a Canadian passport, allowing him to build a credible back-story – or legend.
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This had to be
watertight. The illegals operate under deep cover. There is no pretence of being a Soviet diplomat and these men and women have no diplomatic immunity if they are caught. Even more remarkably, they give no sign of being Russian but take on a totally different nationality. These were the spies used to meet the truly important agents in the West.

Once in London, Lonsdale moved into business. He had spotted a gap in the market from his time in North America – Britain had yet to develop the American love affair with the jukebox. So he began selling the machines carrying the latest rock-and-roll songs. It was a job that allowed him to travel widely. He had a natural aptitude for business and next became director of a company selling bubblegum machines. At one point he was making so much money that he was able to pay his profits back to the KGB like the good Communist that he was. All the time, he was waiting for instructions to be activated. Every day he visited one of the red London telephone boxes near the back entrance to the Savoy Hotel on the Strand. He would pretend to use the phone but actually feel underneath the wooden shelf holding the telephone directories for a map pin. When he eventually found the pin, he knew it was a sign to head for a dead-letter box. There he found a small wedding-ring case with instructions inside on where to meet a senior KGB officer to receive his marching orders. It was time to get down to his real work. He had an agent to run.

Harry Houghton enjoyed the seedier side of life. When he was posted as a clerk to Warsaw in 1951 he had begun to dabble in the black market, travelling with a gun to seal deals in the back streets of the city involving illicit penicillin supplies (not dissimilar to Harry Lime in Vienna). Booze and women flowed freely and his marriage came under strain. This had all been noticed by his bosses and after being spotted drunk at a reception he was sent back to Britain to work at the Admiralty Underwater Weapons Establishment at Portland, joined to the mainland by a causeway at Chesil Beach.
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Houghton would later allege that his treachery began one afternoon when his office phone rang and the caller said he had come from Poland with a message from an old girlfriend. Houghton claimed they had met at Dulwich Picture Gallery and the man told him the girl would like to leave but would be allowed to do so only if Houghton could
provide some information. ‘Putting it bluntly, all the later mistakes stemmed from that one mistake – chasing a bit of skirt behind the Iron Curtain,' he would later say, explaining that it all started gently with a few innocuous documents before the temperature was raised.
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These were lies. Houghton had unilaterally offered secrets to the other side in Warsaw in exchange for cold hard cash.
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He had provided thick bundles of documents including the Naval Attaché's codebooks. Back in Britain, his work then accelerated. He was given a Minox camera which could pass as a cigarette lighter and copied thousands of files from a safe room where security was lax. In London, amid concerns for the security of their valuable agent, the KGB – which had taken control of him from the Poles – switched to running him through Lonsdale rather than through an Embassy-based KGB officer (although initially Houghton was led to believe he was still meeting Poles in case it scared him off, a so-called ‘False Flag' operation).
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Houghton would carry a newspaper in his left hand as he entered the Bunch of Grapes pub on Brompton Road. ‘Is that the evening paper you've got there?' a man would ask.

‘No, I'm afraid it's the daily,' Houghton would reply.

‘I wanted the racing results,' the man would say and walk into the gentlemen's lavatory. A few minutes later Houghton would follow to pick up a package. As their marriage fell apart, his wife noticed his strange trips to London on the first Saturday of each month and even spotted secret documents at home. She told a number of officials that she thought her husband was in touch with Communist agents. This information was sent to MI5, but everyone agreed she was simply being spiteful and making it up. Her accusations were ‘nothing more than the outpourings of a jealous and disgruntled wife', it was said. She and Houghton soon separated.
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Houghton, even though he was street-smart, proved easy prey for a skilled agent handler like Lonsdale. Lonsdale convinced him that the two men were friends. ‘I came to enjoy the company of the people I worked with, and the challenges they set,' recalled Houghton. ‘We were a team.'
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There was also the sheer exhilaration of being a spy. The feelings were never reciprocated. ‘He was vain as well as shifty,' Lonsdale said contemptuously of Houghton. ‘Once he has his claws into the agent, there's no getting away,' he added, describing how a good officer traps his target. Lonsdale always agreed the next meeting
place and time so that there would be no need for phone calls or a trail for MI5 to follow.

Houghton's access to secrets was limited after it had been noticed that some documents had been misplaced overnight, but he then found a new route through a girlfriend, Ethel ‘Bunty' Gee. When he first told her what he was doing she refused to believe it and then began to cry. But she quickly changed her mind and began to cooperate (‘She's very friendly and talkative. But an awful cook,' Lonsdale told the KGB in one message after dinner at their house).
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At one of many meetings a bundle of 150 five-pound notes was handed over in a brown carrier bag. Lonsdale would receive messages from Moscow on a standard short-wave radio receiver at prearranged frequencies usually at three or four in the morning.

A Polish defector – codenamed ‘Sniper' – revealed in April 1960 that the Poles had recruited an agent in Warsaw, and Houghton was soon put under surveillance by MI5, whose spycatchers had been embarrassed when they realised they already had a trace on him thanks to his ex-wife's suspicions.
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Houghton was watched meeting a man on a park bench and then in a café at Waterloo where an envelope was handed over. The man was then identified as Gordon Lonsdale. MI5 broke into Lonsdale's flat and installed a listening device. Lonsdale was seen delivering items to a safety deposit box at the Midland Bank on Great Portland Street. As the MI5 officer who opened the box flicked through a set of photographs, he saw something which halted him in his tracks. One of the pictures was of himself.
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He had some explaining to do, but realised that he and Lonsdale had both been at a party thrown by a Canadian diplomat and Lonsdale had been taking clandestine photos. The box also contained a cigarette lighter set in a bowl. Peter Wright X-rayed these back at MI5, which revealed a hollow base acting as a secret compartment. Using a rubber suction cup and tweezers he carefully pulled out a set of tiny one-time cipher pads and London map references. Everything was carefully copied and then returned to the safety deposit box in the early hours of a Sunday morning. Did Lonsdale realise he was being watched? Wright would later believe that signs of increased radio traffic at the Soviet Embassy at the time the safety deposit box was removed was an indication that a mole in MI5 had tipped off the KGB.
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Small groups of watchers would tail Lonsdale from his office and then peel off to be replaced by others. This went on for weeks, MI5 officers privately wondering at the quantity and quality of women with whom Lonsdale seemed to consort. They also learnt that he used the cistern in a toilet at the Classic Cinema at Baker Street as a drop point, hiding notes and radio spare parts in a condom deposited in the lavatory. He was also spotted heading to a bungalow in the bucolic London suburb of Ruislip. It was the home of a sociable, elderly couple who ran an antiquarian booksellers on the Strand, Peter and Helen Kroger. What MI5 call a ‘static observation post' – in other words a camera in a neighbour's house – was set up to watch the comings and goings of this innocent-looking couple. Peter Wright began reading some of Lonsdale's messages from Moscow which included not only professional information about how to run Houghton, but also news of his wife and children back home. They were missing him and wanted him back.

In January 1961, the CIA informed MI5 that Sniper was defecting and so the net had to be drawn in. On a Friday night, Arthur Martin and Peter Wright from MI5 sat in a brown cell-like room in their headquarters and listened in to the sounds from Lonsdale's flat which they had bugged. Listening to targets like Lonsdale sometimes generated a strange affinity among the buggers as the intimate details of a person's life were revealed. ‘It's not as if he's a traitor … not like Houghton. He's just doing his job like us,' Wright reflected.
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They heard him make love to a girl and then in the morning persuade her to leave, saying he had urgent business. Lonsdale, Houghton and Gee were all meeting at Waterloo Bridge Road. Houghton thought he had seen someone running behind him to catch his bus but thought nothing much of it. As Gee handed over a shopping bag containing secret films, three cars drew up on the kerb and a dozen men in regulation beige mackintoshes seized the group. Special Branch went to visit the Kroger house. The Krogers were not who they appeared to be. They were two more Russian illegals – real names Morris and Lona Cohen. They had operated in the United States in the 1940s until Philby had tipped the KGB off that they might be discovered. In the London suburbs, their job was to support Lonsdale and act as the link between him and Moscow. The Special Branch officer told Lona she would be taken away for questioning. Could she just stoke
the boiler before she went? she asked. The officer was sharp enough to say, ‘First let me see what's in your handbag.' She refused. There was a struggle. Inside the bag, the officer found a glass slide with three microdots and a typed sheet of code. When the home was searched a microdot reader was found in a box of face powder. Microdots allowed documents to be reduced to a size sometimes of less than a millimetre and then concealed, even in a bottle of orange juice. Also discovered were seven passports and the crucial piece of equipment – a powerful radio transmitter in a grey suitcase-sized case which could compress a long message and then send it as a burst transmission all the way to Moscow in a few seconds.

Lonsdale would not talk. No one understood yet that he was an illegal. It took a strange bit of detective work to understand that he was not really Lonsdale after all. The doctor in Canada who had been present at the real Lonsdale's birth was tracked down. He remembered the birth because he had had to travel miles into the countryside down dark lanes. He checked his records which showed that the real Lonsdale had been circumcised as a baby.
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The man who had been arrested had not been. The revelations of illegals, radio sets in the suburbs and treacherous Britons were sensational and captivated the nation, leading to much despair on the part of Prime Minister Harold Macmillan.
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So important was the trial that Lonsdale/ Molody was prosecuted by the Attorney General himself, the formidable Reginald Manningham-Buller. The sentence was twenty-five years' imprisonment. Manningham-Buller had also dealt with the Blake case personally. He had proposed to the Prime Minister that Blake should be charged on five counts for each posting and he made sure the judge knew that at least forty agents had been betrayed.
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The high-profile spy trials meant that reporters were frequently camped out on the doorstep of Manningham-Buller's home. He developed a distaste for the world of spies which he regarded as somewhat seedy. The Attorney General's daughter Eliza, barely into her teens, watched with curiosity, an introduction into a world into which she would later plunge.