by Andrew Cook
Vickers’ ruthless and unscrupulous representative Basil Zaharoff was the biggest player in the arms trade at this time, and it is hardly surprising that his name has been subsequently linked with the equally unsavoury Reilly. Zaharoff was featured as a prominent character in Troy Kennedy-Martin’s television adaptation of Ace of Spies,60 despite the wholesale lack of evidence linking the two. Richard Deacon, who also proffered the theory that Reilly was an Ochrana agent, believed that ‘one of the tasks which the Russian Secret Service set for Sidney Reilly was to build up a dossier on the notorious international arms salesman, Basil Zaharoff’.61 Ochrana records at the Hoover Institute in California and in the State Archive of the Russian Federation in Moscow contain no corroboration for this belief, nor for any kind of association between Reilly and Zaharoff.
Not unsurprisingly, Reilly was viewed with suspicion by many of those he came into contact with in St Petersburg. Some thought he was an English spy, others said he was spying for the Germans. In November 1911 the Suvorins had been concerned enough to make enquiries about Reilly and his activities. Boris Suvorin initially asked his associate Ivan Manasevich-Manuilov, a Novoe Vremia journalist, to check with Stephan Beletsky, the head of the St Petersburg Police Department. Beletsky referred the enquiry to Gen. Nicolai Mankewitz, head of counter-intelligence. As a result Reilly was briefly kept under close surveillance and had his mail intercepted. As with the previous year’s check initiated by the Interior Ministry, nothing that would give any cause for concern was found and Mankewitz called off the surveillance and closed the file.62
Among the regular correspondents Reilly kept in touch with was his cousin Felitsia, now living in Warsaw. Their close relationship is evident from a verse from the 29th stanza of the Rubaiyat of Omar Khayyam he sent her:
Into this universe, and why not knowing,
Nor whence, like water, willy-nilly flowing,
And out of it, as wind along the waste,
I know not whither, willy-nilly blowing
Ironically, Manasevich-Manuilov was himself an Ochrana agent and had supplied information on Boris Suvorin and his fellow directors to the Ochrana authorities.63 As the storm clouds of the First World War approached, concern about German spies intensified and Manasevich-Manuilov turned his attention to supplying lists of suspects. With growing tensions between the two countries, naval contracts dwindled and eventually petered out altogether. Thankfully for Reilly, the clouds of war on the horizon were to have a substantial silver lining.
SIX
THE HONEY POT
While Reilly and Nadezhda Massino were holidaying at St Raphael on the French Riviera,1 a Bosnian Serb student named Gabriel Princip assassinated the heir to the throne of the Austro-Hungarian Empire, Archduke Francis Ferdinand, in Sarajevo on 28 June 1914. This set off a chain reaction that within six weeks would envelop the great powers in a world war. On 5 July Germany declared its support for Austria, who in turn issued an ultimatum to Serbia that was purposely designed to make acceptance impossible. As the great powers squared up to each other, Reilly hastily departed for St Petersburg, leaving Nadezhda to continue the holiday alone.
On his arrival back in the Russian capital, he soon learned from his contacts that Russia had resolved to take military action against Austria if Serbia was attacked. On 28 July Austria declared war on the Serbs and Tsar Nicholas mobilised Russian forces the following day. Germany’s declaration of war on Russia on 1 August found the Russians ill prepared. What would turn out to be a catastrophe for Russia, and the Tsar in particular, would provide Reilly’s big chance, not only to make the millions he dreamed of, but also to make his mark on history.
As the hostilities commenced, a small army of contractors and brokers set off to secure the guns, ammunition, powder and general military equipment that the Russian war effort would need in abundance. Within days of war being declared, Reilly had been commissioned by Abram L. Zhivotovsky of the Russo-Asiatic Bank and the Russian Army to acquire munitions for the Russian Army.2 Before departing for Tokyo in early August he wrote to both Margaret and Nadezhda.3 For Margaret it would be the last letter she would receive from him until the war was over. Once in Tokyo, Reilly successfully secured a large powder deal with Taka Kawada and Todoa Kamiya of Aboshi Powder Company,4 and the contract was then put in the hands of Reilly’s agent in Japan, William Gill.
While Reilly was in Tokyo, Samuel M. Vauclain, vice president of the Baldwin Locomotive Works of Philadelphia, arrived in St Petersburg seeking contracts for narrow gauge locomotives and munitions.5 Although Reilly was absent from St Petersburg, Vauclain found that his main competitor for the munitions contract was Reilly. It was obvious to him that Reilly had tremendous political backing in Russia which emanated from the office of the Tsar’s cousin, the Grand Duke Alexander Mikhailovich, a contact Reilly had made at the time of the Russo-Japanese War through Moisei Ginsburg. The grand duke showed Vauclain a telegram from Reilly, sent through his London office, in which he had cut his contract price.6 However, on this occasion, Vauclain won the contract, and took back an order for 100,000 military rifles, converted to use Russian cartridges, to be manufactured by the Remington Arms Company. Not long after, Vauclain shrewdly converted the Baldwin plant at Eddystone, Pennsylvania, which was running two thirds below capacity, to manufacture arms and munitions.
Before the war was over, the United States would manufacture over a third of all Russia’s war munitions and equipment. American industry quickly saw the opportunity that beckoned, as indeed did brokers such as Reilly. Having concluded the powder deal in Tokyo, Reilly booked a passage on the SS Persia, which sailed from Yokohama Docks bound for San Francisco on 29 December 1914. It arrived in San Francisco on 13 January 1915.7 On arrival he declared to US Immigration that he was a forty-one-year-old merchant of British nationality, born in Clonmel, Ireland. He further declared that this was his first visit to the United States, that his journey had started in St Petersburg and that he had a through ticket to his final destination, New York City.8 Apart from his claim to have been born in Clonmel, the rest of the informa-tion he gave was true. From San Francisco he travelled to New York by train, where he took an apartment at 260 West 76 Street.9
Through the Russo-Asiatic Bank he was introduced to Hoyt A. Moore, an attorney specialising in import and export matters. Moore not only provided advice to the new arrival but also recommended an acquaintance, thirty-year-old Dale Upton Thomas, whom Reilly took on as his office manager. Hays, Hershfield and Wolf, at 115 Broadway, another Moore introduction, became Reilly’s legal representatives. A short walk away, with its classical arched entrance and grand marbled lobby, was the Equitable Building, at 120 Broadway, which Reilly chose as his New York base. He took 2722, a prestigious high-floor suite overlooking the downtown financial district of Manhattan, from where he and Thomas were to operate for the next three years.10 The Equitable Insurance Company was well established in Russia11 and its Broadway building was already home to a number of Russian tenants, a good number of whom were dealing in wartime munitions contracts in America. It was also through Hoyt Moore that Reilly met Samuel McRoberts, vice president of the National City Bank, who was also keen to profit from the honey pot that the war in Europe promised to deliver. To this end he procured Reilly’s appointment as managing officer of the Allied Machinery Company, which was also based at 120 Broadway.12 It has been suggested that Allied Machinery was a Reilly front company, when in fact it had been established since 1911. McRoberts was elected to the board of directors the following year, from which position he was able to introduce Reilly into the company. Company records indicate that Reilly was neither a shareholder nor a director, and was purely an employee, albeit a senior one.13 The purpose of the company was to ‘manufacture, produce, buy, sell, export, lease, exchange, hire, let, invest in, mortgage, pledge, trade and deal in, and otherwise acquire and dispose of machinery, machine-tools and accessories, machinery products and parts and goods, wares and merchandise of every kind and description
’. In other words, it had an extremely wide remit and was ideal for trading within the new munitions marketplace.
While it is clear that Reilly used his exceptional networking skills to their full advantage and no doubt made the acquaintance of a large number of businessmen in NewYork, these often tenuous relationships have been used to associate Reilly with a range of events with which he had no connection whatsoever. His rivalry with J. Pierpont Morgan, the Anglophile American financial magnate, is a prime example. Morgan, best remembered today for his ownership of the White Star Line and its ill-fated flagship the RMS Titanic, was the main player in the allied quest for munitions in the United States. His desire to monopolise the arms trade on behalf of the Allied powers alienated him from the small army of independent brokers, like Reilly, who sensed they would be squeezed out of the munitions marketplace if Morgan succeeded in his aims. The very month that Reilly arrived in New York, Morgan had signed an agreement with the British Commercial Agency that made him the sole agent in the USA for munitions purchases. As part of this deal, Morgan made his ambitions clear so far as the Russian market was concerned, by offering Russia a $12 million credit on the proviso that his company acted as agent for all contracts signed as a result.14
On 3 February 1915 an explosion rocked the DuPont Powder Plant in DuPont, near Tacoma, Washington. According to the Tacoma Daily News (an afternoon publication):
With a detonation that was heard for miles, the black powder plant of the DuPont company at DuPont, near Tacoma, exploded at 9.30 this morning, demolishing the building, killing Henry P. Wilson, thirty- five, unmarried, and seriously injuring Harry West, married. As Wilson and West were the only men in the vicinity at the time officers of the company said the exact cause could not be given. The roof was lifted off the building and the sides blown to pieces, corrugated iron being scattered for a radius of 200ft. The building was one of a chain and was known as the ‘press’ building, where the powder is pressed into cakes. Wilson’s body was blown about 50ft from the building. West was thrown about 150ft.15
Richard Spence has speculated that Reilly’s hidden hand was behind the explosion, as DuPont had opted to do business with Pierpont Morgan rather than Reilly.16 Spence believes that German saboteur Kurt Jahnke executed the deed on Reilly’s instructions, drawing attention to Jahnke’s supposed later admission to his German superiors that he was responsible. The more likely scenario was that Jahnke was seeking to take credit for something that was none of his doing, and was, in all likelihood, a complete accident. Indeed, the official verdict remains, in the absence of any compelling evidence to the contrary, that it was an accident. According to former DuPont employees, explosions at the DuPont Works were not unusual. They did not happen often, but when they did they were usually due to accidental causes.
Furthermore, Reilly had been in America for less than three weeks when the explosion occurred. It would have been somewhat difficult for him to have sought a powder contract with DuPont, to have been rebuffed by the company, and then to have planned and executed such a response, all within the space of some nineteen days. In short, there is no tangible evidence to connect Reilly with either Jahnke or this tragic accident.
Since his departure from St Raphael back in July 1914, Reilly and Nadezhda had been exchanging letters. Her divorce, which had recently been granted, meant that they could now marry. Although there is no doubt that she was in love with him and that he was very fond of her, doubt remains as to whether he actually wished to marry her. Although in his letters to her he promised to send for her as soon as he arrived in New York, she could well have had reason to doubt him. The fact that throughout their three-year relationship she had been married and latterly awaiting a divorce meant that the issue of marriage had not been a consideration. Once the divorce came through in 1914, he may well have had second thoughts, being perfectly content for her to remain as his mistress. If this was not the case and he really did have every intention of marrying her, there would have been absolutely no need for the Machiavellian scheme Nadezhda now embarked upon.
At her own expense she purchased a ticket in the name of Nadine Zalessky at Le Havre and took the SS Rochambeau to New York. As the liner neared New York she cabled Reilly to notify him of her arrival in order that he might meet her at the pier. She also cabled the New York police, informing them that Reilly was importing a woman into the state for immoral purposes – a criminal offence under the Mann Act.17 When her ship docked on 15 February,18 Reilly was there to meet her and so too were the police. The police arrested Reilly and, despite his insistence that she was his fiancée, informed him that he could only avoid prosecution and possible imprisonment if he married her immediately. As he had already promised to marry her and she had stated that this was the purpose of her journey, he did not have a leg to stand on. It was the first day of Lent under the Orthodox calendar, however, and Orthodox weddings do not, by custom, take place during the first week of Lent. Reilly, therefore, had to appeal to the head of the Russian Orthodox Church in America, Metropolitan Platon, to give special dispensation for the wedding to take place.19 As luck would have it, for Nadine at any rate, Platon gave his permission, and the wedding took place the next day at St Nicholas’s Cathedral in Manhattan.20 Nadine claimed in the marriage register that she was the twenty-seven-year-old daughter of Pierre and Barbara Massino, residing at the Ritz Carlton Hotel, at 313 East 63rd Street. She was, in fact, twenty-nine years old. Reilly stated that he was a forty-one-year-old bachelor, the son of George and Pauline Reilly of Clonmel, Ireland, residing at 260 Riverside Drive, an address that did not exist until 1925. Petr Rutskii from the Russian Consulate was one of the witnesses.
Reilly’s marriage on 16 February 1915 almost certainly saved him from arrest by the New York Police Department.
G.L. Owen21 believes that the Reillys left New York shortly after their wedding and undertook a visit to Petrograd. The timing of this visit may seem incidental, but it is of crucial importance in terms of authenticating a claim by Owen that the Reillys sailed back to New York on the same ship as a prominent German spy. Franz Von Rintelen was sent to America by German intelligence to co-ordinate a campaign of sabotage and disruption that would hopefully stem the flow of munitions to the Allies. Von Rintelen arrived in New York on 3 April aboard the SS Kristianiafjord, travelling on a Swiss passport under the name of Emil V. Gasche.22 A search of the passenger list, however, reveals no Sidney or Nadine Reilly on board, nor indeed any male passenger fitting Reilly’s general physical description (around 5ft 9 or 10ins tall, brown eyes, dark hair, in the region of forty years of age). This is purely and simply because the Reillys had been in New York all the time. They did not, in fact, leave the city until 27 April, when they boarded the SS Kursk bound for Archangel.23
Arriving in the north Russian port on 11 May, they proceeded immediately to Petrograd. While Nadine spent some time with her family, Reilly entered into negotiations with the Russian Red Cross, with a view to securing, on their behalf, ambulances and auto-mobiles from Newman Erb and the Haskell and Barker Car companies.24 He also met with the Tsar’s cousin, Grand Duke Alexander Mikhailovich. The grand duke had been head of the Directorate of Commercial Navigation and Ports during the war, and worked closely with Ginsburg in organising coal supplies to Vladivostok. A keen photography enthusiast, Alexander Mikhailovich was no doubt much impressed by the American automatic camera Reilly brought with him.25 According to G.L. Owen, the Reillys were in Petrograd between June/July and September of 1915, a view shared by Richard Spence.26 Although originally intending to leave Archangel on 13 June,27 their departure was postponed until 26 June, when they headed back on board the SS Czar.
The delayed departure was more than likely caused by the attentions of the Ochrana, who were taking a close interest in Reilly and the war materials he was trading in. Before going aboard the SS Czar, he was searched on the orders of Col. Globachev, head of the St Petersburg Ochrana. Nothing incriminating was found on him or in his trunks and he was al
lowed to proceed on his way.28 One such deal that attracted Globachev’s interest concerned a consignment of nickel ore ordered through Reilly by the Russian government. The consignment was duly shipped to Russia via Sweden in a deal Reilly brokered through the Swedish Russo-Asiatic Company. All had proceeded smoothly until a routine check indicated that the weight of the ore unloaded in Petrograd was somewhat less than the amount loaded in New York.29 This immediately lead to rumours that the missing ore had been appropriated in Sweden and sold on to Germany. A more likely scenario, however, was that the Russian government had been short-changed in New York by a sleight of hand on the paperwork. It would not have been the first time that a Reilly consignment was loaded underweight but the customer invoiced for the full cargo.
Reilly’s postponed departure lead to a rumour reaching the Russian General Staff that the Ochrana had detained him. Maj.-Gen. Leontyev of the Quartermaster-General’s Office immediately sent a cable on 24 June30 to the staff of the commander-in-chief of the 6th Army, instructing that urgent enquiries be made to establish what had happened to Reilly. In a reply from Maj.-Gen. Bazhenov, Leontyev was assured that Reilly had not been detained and that he had been allowed to depart unhindered.31
Arriving in New York on 10 July,32 Reilly returned to his desk at 120 Broadway. It did not take him long to work out that the main problem being encountered by American companies was not in securing munitions contracts per se, but in ensuring that the order, once manufactured, was actually accepted on delivery. Russian inspectors, whose job it was to ensure that shells, for example, were up to standard, were exceptionally careful about passing them. In the first six months of the war it was found, to the great cost of those at the battlefront, that some shell deliveries were not compatible with Russian guns and could not be fired. The result of this was a more vigorous system of quality control. This inspection system applied to all munitions including rifles, which had to be specially converted to take Russian cartridges. This presented an opportunity for Reilly, who had a close relationship with those issuing the surety bonds necessary before the Russian government would accept the consignment. On 19 April 1915, for example, Reilly signed a deal whereby he would, ‘assist in the performance of the said contract and in particular in reaching an understanding with the Russian Government as to the assurances required… that the contract will be performed’.33 In other words, Remington Union would pay Reilly a large sum of money to ensure that their rifles successfully passed through the quality control process and were accepted by the Russian government. Over three years later, Samuel Prior, who had signed the agreement with Reilly on behalf of the Remington Union Company, quite accurately described the deal as a ‘hold-up’34 on Reilly’s part, for unless he was given a commission on the deal, the implication was that he would use his influence to frustrate their ability to get the rifles accepted.