Spies: The Rise and Fall of the KGB in America (100 page)

Not surprisingly, the recall, arrest, and execution of so many officers and
the focus on hunting fantasy Trotskyists and traitors from 1938 into early
1941 gravely crippled the American KGB station's activities. When calm
started to return, an April 1941 memo evaluating intelligence operations
in the United States made clear the consequences of the turmoil. It noted
that the American station had fifteen KGB officers, but only two, Ovakimyan and his deputy Pastelnyak, had been in the country prior to 1939. The others were young officers, all commissioned since 1938, who "`do
not have operational-Chekist [KGB] experience, especially in work
abroad."' Only four of the station's officers had good English skills, seven
more were "`satisfactory,"' and the others were fair or poor. By the end
of the 1930s the station had developed some ninety-two agents, an impressive number, but most had subsequently been deactivated. Twenty of
those deactivated sources had been rated as valuable. Not only had it cut
off relations with useful sources, but also those that remained were being
serviced by inexperienced KGB officers whose grasp of English left a
great deal to be desired.28

A later Moscow Center plan for expanding intelligence operations in
the United States noted the ground that had to be made up:

"Everything depended on the existence of cadres-operatives who could oversee the activities of the aforementioned agents, but unfortunately, over the last
several years, the Amer. station endured a sharp crisis with regard to operatives. Of those who were available, individual workers were systematically sent
back home, both in 1939 and 1940. Thus, with breaches in the most important
areas of our intelligence work, we were forced to de-activate a significant number of agents and, with whatever forces were available, to conduct our work on
the smallest possible scale. This situation was also complicated by the fact that
a significant portion of the remaining American station workers were young
and newly arrived ... who shouldn't have been used at all for independent, serious work, and because of this, our most qualified agents in the field of polit.
and dip. work were left temporarily without guidance."29

As for the KGB's American illegal station, in April 1941 a Moscow
Center memo bluntly stated that by 1939 "`the station comprised a single employee-Station Chief Jung [Akhmerov]. When Jung was recalled
in December 1939 to the Sov. Union, the station ceased to exist."' Fitin
and his staff prepared, and Beria approved, a detailed plan in April 1940
to reestablish the illegal station with a new chief and officers sent from
Moscow. But for unknown reasons Moscow Center never implemented
the plan. Nine months later Fitin proposed and Beria approved a second
attempt to reestablish the illegal station, providing a generous budget and
designating Arnold Deutsch, a talented veteran illegal field officer as its
new chief. Moscow Center prepared a detailed and elaborate plan to
move Deutsch and his family to the United States in 1941 and to establish them with false identities:

"To arrange for `Stephan' [Deutsch] and his family to be sent over to the USA,
we are using his Austrian passport, which was issued under the name Alfred Deutsch in Austria and expired in December 1937. For the purposes of using
the passport to travel to the USA, we are preparing a copy of the document
with `Stephan's' wife written in, providing a 5-year extension (with a stamp
from the Austrian consulate in Paris), and filling in a route from France to
Latvia and all marks of Stephan's residence in Latvia until the present time.

Concurrently, we are assigning our station chief in New York the task of
finding someone who could submit a petition to U.S. authorities for the issue
of an immigration visa to the family, whom we plan to send from Latvia to the
USA. This could, for example, be done by `Frost' [Boris Morros] or `Boss'
[Henry Bookman]. Having been informed by the station that such a person
has been found, Stephan will write him a warm, `family letter,' in which he will
inform him of his desire to come to live in the USA with his family and ask for
help in this matter. As a courtesy for his relative, he will send in the znd or ist
letter several photographs of his family in a domestic setting.

We will receive the return address for this letter from the NKGB of the
Latvian SSR [Soviet Socialist Republic], where Stephan `lives,' according to
the cover story. This address will be reported to the address department in
Riga, and all the necessary information will be indicated on an address card.
When he is informed by the station that the matter has turned out favorably,
Stephan will submit a petition by mail to the Amer. embassy in Moscow about
issuing him a visa to settle in the USA. Later, when he is requested to visit the
embassy personally, Stephan will `arrive from Riga' and speak with an embassy
official in accordance with the cover story that we developed. In the course of
the maneuvers, it is possible for Stephan to reside for a brief time in Riga at
`his' address. Old Latvian identity papers and a Soviet foreign residence permit will be prepared for Stephan and his family These documents will be necessary for brief residency in Latvia and presentation at the American embassy.
Stephan's mother will use her old passport, in which the necessary marks will
be made, which will extend her trip from Austria to Latvia."

All this planning was for naught, however. In transit to the United States,
Deutsch died when a German U-boat sunk his ship.30

The Nazi attack on the USSR in June 1941 forced Moscow to put aside
its obsessions about imagined traitors and concentrate on intelligence
needed for the Soviet war effort and its future ambitions. The American
environment also changed. The Nazi-Soviet Pact of August 1939 had
heightened public and American government suspicion of the Soviet
Union and led to an increasing political isolation of the American Com munist Party and the breakdown of its Popular Front alliance with liberals. But with the Nazi attack all that vanished. President Roosevelt offered Lend-Lease aid to the USSR, and after Pearl Harbor, the United
States and the Soviet Union became allies in the war against Germany.
American Communists regained much of the influence they had lost in
the broad New Deal coalition.

American industrial, military, and technological resources were vital
to defeating Germany, and the Kremlin demanded covert intelligence in
addition to the information supplied to the USSR through diplomatic
channels and by massive American Lend-Lease aid. But because of the
damage done by the Terror, the KGB's American station was ill-prepared
to respond. Following Ovakimyan's arrest in May 1941, it was at it lowest
point since it had been established in 1933. After Ovakimyan was deported, the New York station had only one senior officer remaining with
field experience in the United States-Pastelnyak-to manage a group
of inexperienced officers, most with inadequate English-language skills.
And Pastelnyak himself had only limited foreign intelligence expertise
and a poor command of English. As for the illegal station, as noted, it had
been nonexistent since late 1939.

Moscow quickly dispatched several veteran senior officers. After
Deutsch's death, Fitin ordered Iskhak Akhmerov and his wife, Helen
Lowly, back to the United States in December 1941 to revive the illegal
station. Fitin chose Vasily Zarubin as legal station chief and overall supervisor of KGB operations in the United States. The vicissitudes of
wartime travel meant that he did not reach the West Coast until December 1941 and only got to the East Coast in January 1942. Zarubin
had served as both a legal and illegal officer and also as a station chief in
several European countries and China and, moreover, had carried out
several short-term missions in the United States in the mid-193os and
spoke English well. (Zarubin's appointment also began a shift in KGB organization in America. In the 1930s the handful of KGB officers stationed
at the Soviet Embassy in Washington was an appendage of the legal station operating out of the Soviet Consulate in New York. While Zarubin
served as New York station chief, his cover job was as a diplomat in Washington. He gradually shifted more of the KGB's personnel to the capital,
whose explosive growth during the war required more KGB attention.
By 1945 the KGB Washington station was an independent entity, and its
chief, Anatoly Gorsky, oversaw all KGB operations in America, including the New York station, headed by Vladimir Pravdin.)

With Zarubin came an influx of new officers and continued improve ment in the professionalism of younger operatives already in the United
States significantly upgraded the station's capabilities. But none of this
happened overnight, and when Zarubin took up his post in January 1942,
he had only an inadequate cadre of KGB professionals available at the
legal station while Akhmerov had nothing at all in place for the illegal
station. It would not be until 1944 that the KGB's American stations (legal
stations in New York, Washington, and San Francisco plus the illegal station) were up to adequate strength with an appropriate mix of experienced and junior field officers and support staff. Meanwhile, the Soviet
Union was fighting for its life against a massive German invasion, and
Stalin's demands for intelligence and information from America could
not wait for a methodical rebuilding of an intelligence apparatus that had
been wrecked between 1938 and 1941.

Fortunately for the Soviet Union, Jacob Golos and the American Communist Party stepped forward to fill the vast gap between the KGB's limited capacity and its enormous needs for intelligence. From 1941 until
1945, Golos and the CPUSA provided the KGB with its most valuable political, diplomatic, military, and technical intelligence sources. The relationship was fraught with difficulties and tensions, and the KGB was always aware that its reliance on party-based networks might result in
catastrophe. In the short run, the risk paid off, and the years from 1942 to
1945 were a golden age for the KGB. But later there was a price to be paid.

Ovakimyan had handled liaison with Golos directly, but for security
reasons in April 1941 he transferred that responsibility to Aleksey
Prokhorov, a junior officer who was impressed by his new contact. In June
he noted that Golos "`has contacts with tons of people. He knows everything. He is informed about all our work. Everything at the station has
been boiled down to `Sound' [Gobs], on all lines. Several agents who are
connected to `Sound' and provide reports are unknown to us other than
by their cover names. He has been given the task of providing information on the entire network connected to him."' Later that month the station asked Golos to arrange to send ethnic European-Americans into Germany disguised as journalists and relief workers, and Prokhorov also
asked that "`he inform us in detail on the activities of the U.S. government
regarding current events, as well as on the work of opposition groups in
the government."' A handwritten Moscow Center note on that report
asked, "`What, is Sound a wizard?"' and another Moscow Center anno tation directed that New York station officers be reminded that they
"`should behave in a more purposeful manner and not try to turn him
[Gobs] into a department store.... Only give assignments that are really
needed, and not whatever comes into somebody's head.' "31

But the KGB New York station had little else to rely on in late 1941
other than Jacob Golos and the party-based sources that he jealously
guarded. Nor was the relationship helped by the fact that Pastelnyak, the
acting station chief until Zarubin arrived, viewed Golos as "`an idiot and
regarded him with distrust."' Pastelnyak's limited foreign intelligence experience was also largely with the "White" line that dealt with Russian
exiles, monarchists, and other anti-Bolshevik Russians and wasn't attuned
to Moscow Center's shift to technical, diplomatic, and political intelligence of more immediate concern to the war effort. Zarubin, on the other
hand, realized he needed Golos and his party networks precisely for those
targets. His goal was to curb Golos's independence and ultimately gain
control over his sources.32

Zarubin wrote a detailed account of his tenure as station chief for
KGB chief Merkulov after being recalled to Moscow in 1944. He explained that his initial efforts to gain political intelligence led him to utilize contacts with the CPUSA: "`As a result of the war a number of new
government institutions were established that were definitely of interest
to us. Certain fellowcountrymen [Communists] and progressive people
they knew went to work at these institutions. It seemed to me that by acquiring connections among them we would be able to obtain the information that interests us more quickly."' Zarubin contacted Gene Dennis, number two man in the CPUSA (Earl Browder was then in prison on
a false passport conviction). He was cooperative, and using Earl's brother
Bill, Earl's Russian-born wife Irena, and other CPUSA contacts, the station recruited a number of sources who, while helpful, "`did not fulfill
the hope we pinned on them.' "33

In contrast to the meager returns from these recruits, Zarubin reported, Golos's sources had been a gold mine, and he devoted nearly half
of his report to the agents who had come to the KGB New York station
from Golos. From the very beginning, however, Zarubin had instructions
from Moscow to bring those sources under control: "`to study all the people in the group and to determine the possibilities of making them more
active while they were in the system of `Sound's' [Golos's] organization
and to orient the group's work above all toward obtaining polit. and econ.
information; to study the organizational system of S.'s work and on this
basis to work out the problem of breaking up his group into smaller units and relieving him of all connections that he doesn't need to carry out the
main tasks."' This effort met resistance: