Enemies Within

by Richard Davenport-Hines

  Generations of Labour activists nurtured festering resentment of MI5 for plotting to install the Conservatives in power: the party’s antagonism towards the intelligence services continues to this day. But it was suspicions of the financial terms of the Anglo-Russian treaty, and MacDonald’s refusal to institute a tribunal of inquiry into the Campbell case, coupled with Liberal voters transferring to the Conservatives, that lost Labour power: not the Zinoviev stunt. On the other side, from 1925 onwards, SIS collected ample and reliable evidence that in response to the Riga forgery Moscow sought to discredit, mislead and confuse the British intelligence services by providing forgers with blank Soviet and Comintern writing-paper with which to concoct bogus material for the misdirection, humiliation and weakening of SIS and MI5.

  A trades union delegation left for Moscow in mid-November 1924 to investigate the authenticity of the Zinoviev letter. On 21 November the Daily Herald carried a small advert placed by Ewer: ‘Labour Group carrying out investigation would be glad to receive information and details from anyone who has ever had any association with, or been brought into touch with, any Secret Service Department or operation.’ A box number at the Daily Herald was given for replies. Probably this small-ad was a clumsy attempt to investigate the machinations behind the forgery either in parallel or in association with the trades union inquiry in Moscow. MI5 set its agent D to reply. He received a message signed ‘Q.X.’ fixing a rendezvous outside St George’s Hospital at Hyde Park Corner on 1 January 1925. D waited there for an hour in vain. He was kept under surveillance by an MI5 colleague, who spotted another man (later identified as Walter Dale) also keeping covert watch. Following a second approach, D met Q.X. in a wine bar. Q.X. was soon identified as Ewer. They had several meetings, during which Q.X. questioned D about intelligence, until Dale, who was tracking D after meetings, discovered his MI5 connection. Ewer dropped him and, if challenged, could have pretended that he was investigating a possible story for the Daily Herald.

  Ewer and his network were put under surveillance. Ewer himself kept short hours at the Daily Herald office, punctuating his working day with visits to Fleet Street pubs, notably the Cheshire Cheese, lunches in the Falstaff restaurant in Fleet Street and tea-breaks in cafés. MI5 collected genealogical and financial data on the families of FPA operatives, checked addresses, obtained Home Office warrants on their correspondence, shadowed them, compiled physical descriptions and took photographic head-shots. The shadowing of Dale led to Rose Edwardes, who in turn led them to room 50 of Outer Temple, for which a Home Office warrant was issued in February 1925. Telephone intercepts revealed the FPA’s regular dealings with ARCOS, Chesham House and the Vigilance Detective Agency. On 11 February the FPA office received a package addressed to ‘Kenneth Milton, Esq.’ containing typed reports in French on Morocco, Bulgaria, Romania and Serbia.

  It became evident that ‘Kenneth Milton’ frequently received packets from Paris. These enclosed copies of French ambassadorial dispatches from various capitals, confidential news on French politics and finance, unsigned typed letters accompanying English plain-language codes, and occasional letters from Indian revolutionaries to comrades living in England. The material justified Vansittart’s quip: ‘in France official secrets are everybody’s secret’. Codewords in the letters were often food-related. ‘Spaghetti’ indicated an agent inside the Quai d’Orsay, paid 5,000 francs a month, who supplied product on Italy. ‘Goulash’ was an agent supplying material on the Balkans. ‘Native grown cereals’ meant an informant from within French political circles. ‘Hospitality’ or ‘footmen’ indicated occasional informants. ‘Bristol’ was the codeword for Warsaw. ‘Glasgow’ indicated Moscow or Russia. ‘Leicester’ meant Paris. Halifax, Cheltenham, Nottingham, Exeter, Hereford and Gloucester were other towns with coded meanings.26

  Then, on 8 May 1925, Ewer’s inadvertence exposed his Paris sub-agent. He published an article on French Morocco in the Daily Herald, under George Slocombe’s byline, which was barely distinguishable from a note to ‘Milton’ intercepted two days earlier. The Home Office issued postal warrants for Slocombe’s private and business addresses. They found that Ewer sent him about £210 a month, of which one-third was spent on bribes to obtain copies of secret documents from the Quai d’Orsay or embassies in Paris. The trusting fealty between Ewer and Slocombe was helped by juvenile matiness. They disdained upper-case typing in their unsigned missives, in which the keynotes were bluff irreverence and Jew-baiting.

  In November 1925 Slocombe became infuriated by the Bolshevik – whom he codenamed ‘flivverman’ – who had arrived in Paris to run him. ‘He’s a thin-lipped hebrew who despises politics of which d’ailleurs [anyway] he’s supremely ignorant and is interested only in originals of whatever value,’ Slocombe told Ewer. Flivverman had conveyed Moscow’s dissatisfaction that Ewer’s network seldom obtained original diplomatic documents. ‘He despises the London food service as too costly thinks you are all a lot of reckless spendthrifts is sceptical of your efficiency, and is generally jewish, but without the hebrew wit.’ Ewer replied on 20 November that he had seen ‘the chauffeur’ (his controller at Chesham House): ‘He’s damned angry with the yiddisher brat whom I think he does not love.’ Slocombe added a covering note with the batch sent on 26 November: ‘Yid improves slightly on acquaintance but … entirely preoccupied with first editions regardless of value. hope however to train him. our personal relations cordial enough. inferiority complex characteristic of his race responsible i think for his preliminary rudeness.’27

  Moscow sent almost £1.25 million to fund the miners’ strike of 1926, which developed into the General Strike. The consequent industrial disruption and civil strife, ample proof of Soviet-inspired subversion within the British Empire and Moscow’s support of Chinese communist revolutionaries against British control in Shanghai determined the Conservative government to break off diplomatic relations with Moscow. In January 1927 an ARCOS employee named Edward Langston informed Herbert (‘Bertie’) Maw of SIS that he had been instructed to photocopy a secret Signals Training manual obtained from Aldershot barracks. This information was passed to MI5, where Kell and Harker spent weeks checking its authenticity, interviewing the informant and consulting an ARCOS accountant who was a reliable SIS source in ARCOS. The Home Secretary, Sir William Joynson-Hicks, was an impulsive populist well described by his parliamentary colleague Cuthbert Headlam as ‘a miserable creature – a shop-walker attempting to pose as a strong man’. When the situation was explained to him (as the result of an intervention of the Secretary of State for War, Sir Laming Worthington-Evans), Joynson-Hicks initiated a raid on the ARCOS offices, with the intention of finding evidence for a prosecution under the Official Secrets Act.28

  Compton Mackenzie, who had worked for SIS in Greece during the war and wrote an insultingly farcical novel Water on the Brain (1933) about Sir Mansfield Cumming’s regime, commented on the ARCOS raid: ‘anti-Russian propaganda was being worked up solely with the object of persuading the country not to vote for the Labour Party at the next election; but the Russian government, less aware than ourselves of the unscrupulousness concealed by the pleasant masks of party politics in Great Britain, might be forgiven for supposing that the mind of the country was being prepared for a declaration of war against the U.S.S.R.’. Mackenzie exaggerated by using the word ‘solely’, but his phrases expressed a widespread and justified suspicion of the motives of Joynson-Hicks, Worthington-Evans and other ministers in Baldwin’s Cabinet.29

  Ginhoven and Jane were unable to warn the FPA of the impending raid, because Special Branch received misdirection, when they were deployed, that the target of the swoop was contraband in the London docks. The raid, on 12 May 1927, was hastily prepared and ill-executed. Desmond Morton was one of the SIS officers who participated in the descent on 49 Moorgate: his biographer Gill Bennett depicts uniformed City of London constables, Special Branch men and SIS officers hurtling around in strenuous, uncoordinated activity. One squirted ink on to a portrait of L
enin’s face hanging on the office wall. No one took charge; almost no one knew the extent of their legal powers to seize materials or detain individuals; few searchers knew what documents to seek. The seized items proved ‘inconclusive and confusing’, once they had been translated, Bennett reports. The stolen Signals Training manual, which it was the primary object of the raid to retrieve, was not found.30

  ‘An immense quantity of police descended on the place, searched the inmates, impounded documents, and for 48 hours have been occupied in smashing up concrete walls in order to break open concealed safes,’ noted Lord Crawford. ‘Secret hiding-places existed all over the building – behind panelling, under floors, in thicknesses of walls; and the place has been throbbing with pneumatic road-breakers, and with expert safe-breakers working acetylene gases.’ The rupture of diplomatic relations with Russia, which was the sequel to the raid, made the ‘Clear out the Reds’ section of the Conservative party rejoice. ‘At last we have got rid of the Bolsheviks,’ a Cabinet minister Lord Birkenhead rejoiced. ‘We have got rid of the hypocrisy of pretending to have friendly relations with this Jewish gang of murderers, revolutionaries and thieves. I breathe quite differently now that we have purged our capital of these unclean and treacherous elements.’ Birkenhead’s cooler-headed colleague Neville Chamberlain considered the raid ‘farcical’.31

  The raid was a blunder, which breached with disastrous results the intelligence principle of watch and learn. Having failed to find any clinching proof of espionage, subversion or schemes of sabotage, the government, which was set on severing diplomatic relations with the Soviet Union, had to justify its decision by producing, instead of the incriminating documents expected from the ARCOS raid, communications between the Soviet Mission at Chesham House and Moscow, which had been secretly intercepted by GC&CS. This proved to be a grievous error. As Gill Bennett has summarized the position, ‘The production in Parliament and publication of these documents for all to see in a Command Paper, revealed their source beyond question, leading to the immediate abandonment by the Soviet Foreign Ministry of its methods of encipherment in favour of unbreakable one-time pad systems for its communications; thereafter no high-grade Soviet diplomatic messages could be read by the British authorities.’

  Admiral Sinclair, the head of both SIS and GC&CS, deplored this heedless political irresponsibility. ‘The publication of these telegrams automatically stops their source of supply,’ he wrote. ‘It was authorized only as a measure of desperation to bolster up a cause vital to Government, which had the facts been fully known at the time, needed no such costly support.’ Both SIS and MI5 had been watching and learning from ARCOS, which had been a promising source of intelligence for the British secret services. Sinclair characterized the ARCOS raid as an ‘irretrievable loss of an unprecedented opportunity’.32

  After the raid, Ewer sent James Marston, Hayes’s predecessor as general secretary of NUPPO, to visit the former ARCOS employee Edward Langston, who was rightly suspected of being the source of the leak and had just started a new life as a publican at the Dolphin in Uxbridge. When Marston began hanging around the Dolphin, disguised as a tramp, Langston sent a panicky telegram to Harker, addressed to the chambers in the Temple of Harker’s brother-in-law Sidney Russell Cooke, asking to be sent a revolver for self-defence. Rose Edwardes had meanwhile ceased deliveries of material from the FPA to Chesham House. Instead, secrets were written in invisible ink in a book which she or Walter Dale took as couriers to Paris. From thence it went underground to Warsaw and thence to Moscow. The expulsion of the Soviet delegation after the raid left Ewer’s network short of funds. The CPGB secretary Albert Inkpin began travelling to Berlin to collect dollars, which he then took to Paris. There Slocombe arranged for Rose Cohen, or other women couriers, to smuggle the dollars to London, where Holmes laundered their conversion into sterling. But this procedure was too complex, and despite obtaining £100 from Slocombe in Paris, the network had shrivelled by October 1927 for lack of funds.

  MI5 investigates the Ewer–Hayes network

  Lakey, who with his taste for disguise was by now established in the new identity of Albert Allen, was left in financial straits after the FPA’s diminuendo. Ewer provided £20 to finance his move to Bournemouth, where he managed Dean’s Restaurant at 261a Wimborne Road, Winton. Jane Sissmore suggested a Home Office warrant to monitor Allen’s decline into debt, and a carefully timed approach to debrief him when he needed financial extrication but would not be too expensive to rescue. After an approach by Kell to Sir William Tyrrell, PUS of the Foreign Office, MI5 was granted £250 for this purpose.

  The first approach to Allen was made by John Ottaway, the chief of MI5’s observation section B6. Ottaway had been born in 1870 in a Midland Railway cottage at Hitchin in Hertfordshire, the son of a pointsman and signalman. In 1891 he became a constable in the City of London Police, lodging in a police boarding-house in Bishopsgate hugger-mugger with other young constables. He rose fast in the force, for ten years later he was already a police inspector, living in Leyton with a Scottish wife by whom he had at least five daughters. While City of London constables managed the formidable traffic congestion of the financial district, officers like Ottaway tracked forgers, swindlers and embezzlers. City of London detectives tended to be well-groomed men, suggesting the managing clerk of a solicitor’s office, rather than burly, heavy-footed plodders. In 1909 Ottaway was appointed detective superintendent – effective head – of the City of London Police, and his family were allotted apartments in Cloak Lane police station. In 1911 he participated in the search for the murderous anarchist Peter the Painter. During 1916 he joined a Freemasons lodge and received the freedom of the City of London. He was recruited to Kell’s department in 1920, and died in retirement at Bournemouth in 1954 leaving the notable sum of £12,000.33

  In 1942 Ottaway’s successor Harry Hunter described Section B6’s surveillance techniques to Anthony Blunt, who was then working for MI5. ‘His methods are very unscientific and depend above all on the experience and patience of his men,’ Blunt informed Moscow. ‘Recruiting is usually through a personal recommendation from some contact of Hunter’s, or by recommendation of Special Branch.’ The training for watchers was ‘primitive’. Hunter inducted new recruits with a few lectures, but relied on practice making perfect: ‘new men are sent out almost immediately on minor jobs accompanied by more experienced watchers, from whom they learn the methods in the actual process [of] following’.34

  Ottaway approached Allen in June 1928 offering to pay £75 for each interview that they had. In July Ottaway took Harker to meet Allen. As Harker reported to Kell, he and Ottaway motored to the Bournemouth suburb where Allen lived. He sat in his car in a small side-road, surrounded by half-built houses and wasteland, while Ottaway, who was masquerading as Mr Stewart of the Anti-Socialist Union, fetched Allen to the car. Harker then explained that he represented Kell, whose position in MI5 Allen knew. He decided that it might inhibit Allen, who talked for over an hour and a half, if he tried to take notes. He knew how often confession is a kind of pride. Interrogators can seem therapeutic: they encourage their subjects to talk about themselves and how they relate to other people; they discourage introspection; they do not lead the conversation by questioning or responses; they try to maintain an appreciative impassivity, never looking too keen, as their targets reminisce, boast, grumble, explain, retell rumours and produce telling anecdotes about other people. ‘I very quickly found’, Harker reported, ‘that we were on quite good terms, and, by treating him rather as my opposite number, found that he was quite ready to talk up to a point. He is, I think, a man who is extraordinarily pleased with himself, and considers that the work which he did for some eight years for the Underground Organisation known as the F.P.A. was admirably carried out, and has not received quite the recognition from its paymasters that Allen considers it deserves.’ Harker recognized Allen’s relief at talking ‘openly about his past life to someone who is not only a sympathetic listener, but also appr
eciates the technical side, and can thus see what an admirable Intelligence Officer Allen has been’. Harker was careful not to prompt or steer Allen, because ‘entirely spontaneous remarks’ were more useful than answers to questions. ‘Before we got down to talking generally, I explained to Allen that I understood from Mr Stewart that there were names that he did not wish to give away, and that this naturally would considerably impair the value of his information, if it was to be made with reservations.’ Allen reflected for a moment before replying, ‘I do not want to give away my late boss, because personally, I was very fond of him.’ Harker responded, ‘Perhaps I could tell you the name of your late boss, in which case you would not be placed in such an awkward position,’ then wrote the initials ‘W.N.E.’ on a piece of paper, and showed them to Allen asking, ‘That was your late boss, wasn’t he?’ Allen said: ‘Yes, Trilby. Trilby is a good fellow and damned smart!’35

  After further corroborative investigation Dale, Jane and Ginhoven were arrested on 11 April 1929; but Scotland Yard was determined to obscure as far as possible the infiltration of its Special Branch. After the three men’s detention Harker went straight to Bournemouth, where he asked Allen to tell all that he knew about the leakages from Scotland Yard, and the names of those responsible. ‘I explained to him that this information was of interest to me if given at once, but that if not given at once I was not prepared to pursue the matter further. I also stated that if ALLEN told the story in a manner which appeared to me to be correct, I would hand over to him the sum of £50, and that if the story which he told me was found to be of use to the authorities, I would consider giving him a further £50, but that, in any case, until I had heard his story, I was prepared to give him nothing.’ Allen accepted Harker’s terms. Before Allen began to tell his story, Harker asked him to note the time (5.10 p.m.) and that he was writing on a blank piece of paper. Harker then wrote, out of Allen’s sight, the names of Ginhoven and Jane together with the time. As Harker reported, ‘I then asked ALLEN to tell me his story straight away without any questions on my part and to preface it by giving me the names of the individuals in Scotland Yard who were known to have been passing on information to the F.P.A. organisation in the past. ALLEN at once gave me the names of GINHOVEN and JANE, whereupon I handed him the paper on which I had written these same names. ALLEN expressed considerable surprise and then continued with his story.’