M

by Henry Hemming

  ‘We have a government in power now whose policy is against this sort of work,’ said Carter.5 ‘I have to carry out their policy.’ His anger had as much to do with Morton trespassing on Special Branch territory as the MI6 man’s disregard for the Prime Minister’s instructions. Carter was right. He and Morton were Crown servants with a constitutional duty to carry out the wishes of the elected government. Yet Max did not see it like this. He interpreted Carter’s anger as evidence of a left-wing bias.

  By this stage of his career Max had only ever worked for men who saw Communism as an existential threat to both the country they loved and to their own class. He did not see it as a legitimate political concern within a tolerant, liberal democracy. Whether it was through force of habit or his own political conviction, the idea of soft-pedalling against the Communists, or being impartial, was anathema to him.

  Desmond Morton did not go on his knees to Colonel Carter. That was not in his nature. Instead, the row between MI6 and Special Branch was allowed to grow until it became, in the words of the historian Gill Bennett, ‘outright warfare’.6 MI5 was dragged into the fray and at one point even received information about Max from John Baker White, the man who had talent-spotted him all those years ago. Relations between MI6 and Special Branch reached an all-time low, until it was decided, in an attempt to resolve the situation, to convene the all-powerful Secret Service Committee.

  In January 1931, the head of MI6 was summoned before this august committee. He was asked to explain why his organisation had agreed to take on Max. One of the charges against C’s ‘intermediary’, that is, Max, was that this young MI6 agent had used a British civil servant as one of his informants. Another accusation was that Max had been, and might still be, a senior figure within the British Fascists.

  This was why Desmond Morton had covered up his agent’s past. There was nothing exceptional about Max’s anti-Communist views, and they were consistent with those held by most MI6 officers. Yet his involvement with the British Fascists was different. Although he could say that he had joined this organisation under instructions from Sir George Makgill, there was, of course, the possibility that deep down he had come to sympathise with this group’s core beliefs. Over the last few years the popular perception of Fascism had changed. In Germany, Hitler’s Fascist party now represented the second largest political grouping and might soon form a government. Mussolini was moving towards a new conception of Fascism as a ‘universal phenomenon’, one that might match international Communism in its reach and power.7 European Fascism was a far more dangerous prospect than it had been five years earlier, and now had the potential to threaten British interests.

  Maxwell Knight was a spymaster of obvious ability, he was trustworthy, industrious and showed rare skill as an agent-runner, but he was handicapped both by his Fascist past as well as his occasional desire to show off, which was what had got him into this mess in the first place. The whole debacle might have been avoided, or at least postponed, had Max been able to resist the temptation to see Carter for lunch and drop hints about his work for MI6.

  The Permanent Secretary at the Home Office, Sir John Anderson, was Chairman of the Secret Service Committee. He told C that the idea of MI6 employing a senior Fascist, such as Max, was intolerable. The possibility that this man had also recruited as an agent a British civil servant was one that he ‘could not possibly countenance’.8 Anderson stressed ‘the danger of a Government organisation such as MI6 being in any way associated with such undertakings’, before adding that the situation was ‘a source of grave embarrassment’.9

  C could have hung Max out to dry. Instead, as MI6 employees generally do when one of their own is under attack, he went on the offensive. He assured the committee that Max’s network contained just four agents. As for his man being a Fascist, C claimed to have documentary proof to show that Max had severed his link with the BF. He also dismissed the idea that Max had been using a British civil servant as an agent.

  Almost all these claims were untrue. Whether or not Anderson believed C, he concluded that the best solution was wholesale structural reform, an opinion shared by his colleagues on the committee, Sir Warren Fisher and Sir Maurice Hankey, two of the most powerful British civil servants of the interwar years. After three further meetings, the Secret Service Committee reached a radical decision.

  The ‘Treaty of Westminster’, as it became known, fundamentally changed the relationship among Special Branch, MI5 and MI6, and the scope of their respective powers. Desmond Morton lost the services of Max and his network of agents, as well as the Special Branch section SS1 (which had become MI6’s de facto domestic wing). Morton and his MI6 colleagues were also forbidden from running agents within three miles of British territory. MI5 came out of it all rather differently.

  The committee ruled that in future Sir Vernon Kell’s department would deal with all Communist subversion in Britain, whether civilian or military. It would be detached from the War Office and renamed the Security Service (a title that took many years to catch on in Whitehall). It was also given the services of SS1 and the man at the eye of this particular storm: Maxwell Knight.

  Max’s ill-advised lunches with Colonel Carter had been the catalyst to one of the greatest shake-ups in the history of British intelligence. It was also the turning point of his career. For months this MI6 agent had been living under a Damoclean sword as he waited to discover the fate of his network and, ultimately, his espionage career. He had been staring at a defeat that was rooted in his inability to make himself invisible and the extent of his Fascist past. Now he was on the verge of a new life as an MI5 officer. He would be offered his own desk, his own staff, more funding than ever before and his own MI5 section with which to carry out the task he saw as his calling in life: defending the realm from Communism. Although he would no longer be working for Desmond Morton, he would stay in close contact with his former spymaster, and this relationship would one day prove to be vital.

  Yet there may have been more to Max’s sudden change of fortune. Towards the end of his life, Max’s most treasured possession was a gold cigarette case. It bore the royal cipher of King George V and the following inscription: ‘Maxwell Knight, 1931’.

  The King was not in the habit of handing out gifts like this for trivial or unremarkable acts. The few people that Max entrusted with the story of why he had been given this cigarette case died without divulging the details, saying only that it was the greatest secret of his career. At the very least, we know that in 1931 he performed some act or service for which the Royal Family, and in particular the King, was extremely grateful. Precisely what he did and for whom may never come to light. It is possible that it involved a case of blackmail and one of the King’s sons, but that is speculation. What is absolutely clear is that the task he carried out for the King coincided with the start of his new life as an MI5 officer.

  Before taking up his post in MI5, Max considered the question of what to call himself and his new section. He knew that the head of MI6 signed himself off as ‘C’, the head of MI5 sometimes went by ‘K’ and Somerset Maugham’s agent, Ashenden, reported to ‘R’. Max decided that his MI5 section should be known as ‘M Section’ and that he would be called ‘M’. Some took this to be nothing more than an abbreviation of his first name, but there was more to it than that, as we shall see.

  Incidentally, M was the moniker that had been used long ago by William Melville, a founding father of MI5. As a newcomer to Britain’s counterespionage agency, Max could have been accused of claiming a slice of its history for himself. His decision to reinvent himself as M was bold and full of chutzpah. It was a sign of the confidence he had in his ability as a spymaster and the new approach he was hoping to adopt. For, by the time Maxwell Knight joined MI5, he had a plan for how to find out what was really going on inside the Communist Party and how to reach the fabled ‘centre of affairs’. To do this he would use a very different kind of undercover agent.

  PART II

  THE RED MENAC
E

  11

  OLGA

  Although Mrs Gray liked having her twenty-four-year-old daughter living with her, in her modest house on the outskirts of Birmingham, by 1931 she had begun to wonder when or whether her eldest was going to find herself a husband. Her daughter’s name was Olga. She was a typist. Mrs Gray, the young woman’s widowed mother, ran a local youth club and volunteered for the Conservative Party. Through this connection she had come to know the wife of her local member of Parliament, Neville Chamberlain, the future Prime Minister, and it was probably through Mrs Chamberlain that, in 1931, Mrs Gray was invited to a summer garden party in the home of the local Conservative Party electoral agent. Rather than attend by herself, she decided to bring her daughter.

  Olga Gray was one of the younger guests at No. 21 Clarendon Road that day, as well as being the most striking. With her peroxide bob and hourglass figure, she was hard to miss. She was also quick, curious and strong-minded. Yet beneath her confident façade was an altogether different person, one who was captive to her past.

  More than a decade earlier, Olga’s father, Charles Gray, had been killed during the war at the Battle of Passchendaele. The news of his death had hit the Grays hard, yet it had not sent Olga spiralling off into paroxysms of grief. Instead, she confessed many years later to feeling a small sense of relief.

  The turning point in her childhood, she later realised, had come several years before the start of the war when her older brother died in a tragic accident. Olga had been just five. Her father never really recovered from this loss. Overwhelmed by grief, he began to lash out at Olga. He wanted her to take his dead son’s place, but he was not sure how. He told Olga to be more like him. Harder. More boyish. Olga started to morph into a tomboy, yet by the time her transformation was complete, her two younger sisters had blossomed into blonde-haired, blue-eyed girls – dainty and pretty and the epitome of everything that Olga was not. Now, her father urged her to be more like them.

  He bullied Olga about her looks, telling her that she was either too feminine or not girly enough. She fought back, and a vicious antagonism developed between father and daughter, fuelled, in many ways, by the similarities between them. Charles Gray recognised parts of himself in Olga – the stubbornness, the pride, the primal certainty – and it spurred him on. When his job as Northern Night Editor of the Daily Mail became stressful he would take it out on Olga. He was violent towards her, but never in front of her siblings or her mother, so that when she told them about what had happened, after he had died, they did not believe her.

  Fourteen years after her father’s death, Olga Gray was still coming to terms with her childhood and its effect on the way she saw herself. Beneath her frank and sometimes combative demeanour was a person who despaired of her looks and found it hard to make lasting relationships with the opposite sex. She was convinced that nobody would ever find her attractive.

  It is unlikely that any of this bubbled up to the surface during the sunny chit-chat at the Conservative garden party in Birmingham, one bright day in the summer of 1931. It certainly did not suit the mood of the occasion. Although the political situation elsewhere in the country was dire, with unemployment close to three million and the new coalition or ‘National’ Government committed to a programme of economic austerity, the mood in the local Conservative Party was upbeat. The venue for that gathering was the home of Robert Edwards, the local Conservative agent, who was confident of success for his candidates in Birmingham at the forthcoming General Election. Amid the happy hubbub of conversation that afternoon there was also the occasional happy yelp from guests playing games on the lawn. One of these activities was clock golf, in which players took turns putting at a flag while moving around the hours of a clock face. At one point that afternoon, Olga agreed to play a round of clock golf with a woman she had got to know at work: an impressive, upright individual called Dolly Pyle.

  Though Olga Gray had been a disruptive presence at most of her schools, and had been asked to leave at least one, she had always done well at games. At St Dunstan’s, Plymouth, she had impressed the nuns in charge by becoming captain of the school hockey team. So, she would have been good at clock golf. Who knows, she might have been winning when Dolly Pyle asked a question that would stay fresh in her mind for the rest of her life:

  ‘I say, old thing, have you ever thought of working for the Secret Service?’1

  Had Olga ever thought of this? In all likelihood, yes, but only in a fantastic and essentially abstract sense.

  By 1931, espionage novels were fashionable and popular, as they had been for several decades in Britain, yet this was also the dawn of the golden age of spy films. Fritz Lang’s breath-taking Spione, in 1927, had been the harbinger, followed by the first ‘talkie’ from Alfred Hitchcock, Blackmail, and another classic spy caper, The W Plan, directed by Victor Saville. The popularity of spy films and spy novels was such that Olga and many others her age had almost certainly daydreamed at some point about what it would be like to be a spy. But she had never imagined that for someone like her, with her background, her qualifications and her lack of social connections, this might ever become a reality. Spies seemed to operate on some higher plane; they were grander and more debonair than anyone she had ever met. She knew nothing to suggest otherwise. Olga’s understanding of ‘the Secret Service’ was based entirely on fictional representations of espionage. At the time even the name MI5 was classified. To be asked to work for the Secret Service in 1931 was like being invited to star in a film. It felt mysterious, exotic and stupendously unreal – which was why Olga thought Dolly Pyle was pulling her leg.

  ‘Gosh, Doll,’ she replied, playing along, ‘that sounds jolly exciting.2 I’d love to.’

  Only then did she realise that ‘Doll’ was being serious.

  In the moments that followed, Olga had to make a life-changing decision. It is possible that she put down her putter.

  Though she did not yet know what the work might involve, it would surely mean leaving home – it was hard to imagine there being many state secrets for a spy to guard or steal in the outskirts of Birmingham. In that case, accepting this offer would mean leaving her mother. This might also involve considerable risks to herself and her reputation.

  The fictional female spies that Olga had encountered on-screen or read about in books were cast in the mould of the legendary female spy Mata Hari: they were beautiful harlots who used sex as a weapon. ‘Any woman who values her virginity would be well advised to keep away from the spy-business,’ warned one former intelligence officer.3 There was no such thing as a spy novel in which the female agent had a successful espionage career before going on to get married, have children and otherwise lead a happy and fulfilled life. Things did not end well for female spies. By agreeing to Dolly Pyle’s proposal, Olga might be risking her reputation and her prospects; and, at the same time, this dilemma brought her up against her old enemy, her crippling lack of self-esteem. How could she ever play the part of a Mata Hari if men did not find her attractive?

  Ultimately, Olga’s curiosity overcame her fear.

  She said yes.

  The next step, Dolly Pyle explained, was for Olga to meet a man from MI5, who would introduce himself as Captain King.

  12

  THE M ORGANISATION

  ‘The incident,’ as it came to be known, happened shortly before Maxwell Knight joined MI5 in late 1931. It took place in Invergordon, a port in the Scottish Highlands, after word spread among the naval ratings that, as part of the government’s sweeping austerity drive, their salaries were about to be cut. On the morning of 15 September, 1931, the crews of several warships refused orders. Others followed suit, and by midday there were mobs of sailors gathered on the forecastles of several ships giving boisterous speeches, singing songs and otherwise enjoying themselves. On board one ship a piano was hauled up on deck. Several crews refused to put out to sea for routine exercises.

  This was the Invergordon Mutiny. Nobody was hurt. It lasted less
than two days, and the rebellious sailors carried out all their essential duties. Yet for the British public the idea of a mutiny in the Royal Navy was truly shocking. News of ‘the incident’ sent the London Stock Exchange into meltdown. Markets plummeted. There was a run on the pound. Sterling lost a quarter of its value, and several days later the government made the momentous decision to leave the gold standard.

  The reaction in MI5 was no less dramatic, largely because one of the songs that was sung by the mutinous sailors had been ‘The Red Flag’ – the Communist anthem.

  In Russia, the Bolshevik uprising of 1917 had begun after a group of sailors refused orders. The Wilhelmshaven Mutiny in Germany, the following year, had been another naval uprising inspired by socialist ideals. Eisenstein’s film Battleship Potemkin, which came out soon after, was a riff on the same theme. For many people, and not just those in MI5, the Invergordon Mutiny was a near miss and a reminder that the possibility of a Communist uprising in Britain was entirely real.

  This was an age in which dictatorship was not yet a dirty word. Universal suffrage was still a recent innovation, and during the war Britain had been effectively run as a totalitarian state. By 1931, a growing number of people across Europe saw dictatorship as a viable and sensible solution to the worsening economic recession. With the Soviet Union apparently thriving, a significant chunk of the British population was at least open to the idea of a strong socialist government, and with it a reduction in democracy.

  Under its new charter, MI5 was responsible for investigating Communism throughout the United Kingdom and the British Empire. Its task was to infiltrate the many tentacles of the British Communist movement, to find out what was being planned and to identify channels of communication between British revolutionaries and their controllers in Moscow, all of whom were working towards the same basic goal: a socialist revolution in Britain. The task that had been given to MI5 was about much more than keeping the peace or guarding secrets. At stake was nothing less than democracy in Britain and the future of the British Empire.