Soldiers, Spies, and the Rat Line

by James V Milano

  USFA Headquarters produced a weekly intelligence summary, classified "secret," of course, which contained much of the routine intelligence picked up by the CIC, the MIS, and the three censorship offices. A section of the director of intelligence's staff was devoted to political intelligence and included two analysts whose job was liaison with the Austrian government. Another aspect of intelligence gathering was handled by the Technical Intelligence Group on Milano's staff, headed by Major Samuel Townsley. It concentrated on German equipment, missiles, and field encoding devices and rounded up and interrogated Austrians who had worked in those fields during the war. William Wagner, whose exploits in radio intercepts are described in Chapter 15, ferreted out virtually everyone in Austria who had been involved in signals intelligence for the German Army during the war. The idea was to discover what these agents knew of Soviet practices and abilities in such matters.

  Milano was not always on good terms with his American colleagues in Washington. At all times, he tried to stay clear of the State Department. He wanted its stuffy officials to know nothing of his operations-indeed, he would have preferred them to know nothing of his existence. As for the CIA, a certain measure of cooperation was inevitable. The two were operating in the same country, and the CIA chief of station in Vienna had regular meetings with the director of intelligence in the Army Staff. They usually discussed political matters, such as the activities of the Austrian government and the position of the Communist Party in Austria. Some CIA officers kept in close touch with Milano and his office, usually hoping to elicit useful information. Milano was guarded in his answers, except when the general good required full confidence. There were occasional conflicts of interest that had to be ironed out, and it was not difficult: Milano and his colleagues knew many of the CIA men from earlier days. The new CIA officers were often old hands who had served in Army Intelligence during the war. But in general the two institutions regarded each other warily: the Army side thought the CIA rather snobbish and resented being looked down on. Milano and his friends, on the other hand, after their much longer experience in intelligence in postwar Europe, tended to look on the CIA agents as pussycats-the Army men were the real tigers.

  On one occasion Milano fell afoul of James Jesus Angleton, the Agency's counterintelligence chief and one of its most celebrated figures. Once again, Milano had been exceeding his authority, this time over a possible double agent. The CIC chief in Vienna told him that the Soviets had approached a U.S. Air Force officer to ask him to spy for the Soviet Union in exchange for money. The officer had immediately reported the matter to the CIC. Milano met the two men and urged them to accept the Soviet offer. The double agent would be supplied with false information to pass on to his Soviet case officer. Milano wanted to see how the KGB handled its agents and also thought it an excellent occasion to feed the KGB with inaccurate technical information that might cause Soviet scientists and technicians great trouble. At the very least, it might lead to a considerable waste of time in Soviet laboratories.

  The problem with this enterprising project was that Milano and his colleagues had no experience in running double agents. They had some idea of the basic ground rules, including the principle that the agent must never be given the misinformation directly. He must be allowed to steal it, in a convincing manner, so that he could account for every detail when asked by his Russian case officers. The Air Force officer agreed with Milano's proposal, and a first package of misinformation was prepared. The agent was then allowed to steal it, and he submitted it to his Soviet contact. Milano, thoroughly pleased with himself, prepared a report on the case and sent it off to the Pentagon.

  Within a week he got his reply. The Pentagon had passed his report on to the CIA, which was furious at his initiative. Angleton himself would be in Geneva shortly, and Milano and the CIC chief in Vienna were to meet him there to be informed of his objections. Milano and Hancock drove to Geneva to make the rendezvous, which was at one of the hotels in the city, and had just sat down to dinner when Angleton appeared.

  Milano had met him once before, during the war. They had both been at Caserta, which had for a time been Allied Military Headquarters in Italy and was the center of intelligence work. Angleton had then been working with the OSS, while Milano had been with Army Intelligence. They had met by chance in the bar of the Allied Headquarters, which was then housed in the royal palace, and had talked together for an hour or so. Milano had not been impressed. The man was clearly a highly competent intelligence officer, but Milano had thought him a self-satisfied snob. Now he had reappeared, clothed in all the authority of the Central Intelligence Agency, to reprimand Milano for his temerity.

  He declined the offer to dine with the two young men. He said that he had another engagement. Instead, he sat down for twenty minutes and lectured them sternly on the need for Washington to control all double agents, particularly the information sent to the unsuspecting Soviets. Low-level officers, like Milano, could not be allowed to judge for themselves what was appropriate or inappropriate. Such things had to be coordinated in Washington with various agencies. In future, he said, Milano would please leave such matters to the CIA. Then he got up and left.

  Milano was suitably chastened. Angleton was right. If the Americans were running double agents, it was at the least necessary that each agent's story should conform with those of other agents, or the KGB would deduce that they were all fake. Running double agents, what the British in World War II called the "double-cross system," was a difficult, complicated task, requiring a whole staff of specialists and a coordinated effort. The CIA then took over the case of the Air Force officer, and Milano heard no more about it.

  Jim Milano's man in Vienna was Major Peter Chambers. He was one of those colorful eccentrics who thrive in the stimulating and exciting conditions of wars, open or covert, but are less well suited to the piping times of peace. Chambers was a cavalryman who chewed tobacco, swore ceaselessly, and had no time at all for the protocol and discipline of military headquarters. He came from a wealthy New York family that had made its money in sugar plantations and refineries in Cuba. Pete Chambers had grown up in the exclusive community of the very rich on the north shore of Long Island. It had not been to his taste. He had gone first to the New York Military Academy (not to be confused with West Point) and then to Yale University.

  He had abandoned his studies after two years and had set out to see the world without leaving a forwarding address. His family had called in the services of a private detective, who had finally caught up with him driving a dogsled in the Yukon. He had unwillingly returned to New York and had then informed his parents that he had decided to be an opera singer. He had been sent to study music in Paris for the next six years, and, although he had never made a career as a tenor, he had lived happily in that city at his father's expense. He had married an American diplomat's daughter, who had divorced him after two years. When his father had died in 1938 and his will had been opened, it had been found to contain nothing for Pete except a note that it was time for him to start working for a living. The allowance had abruptly come to an end, and Chambers had returned to the United States to join the U.S. cavalry as a private. His family connections had won him admission to the Cavalry Officer Candidate School at Fort Riley, Kansas, whence he had graduated a second lieutenant at the age of thirty-two. He had been one of the oldest lieutenants in the U.S. Army, but his timing had been excellent. The war had come, and he had served with distinction as an intelligence officer, ending as a major. He had been on General Mark Clark's intelligence staff in Italy and had arrived in Vienna with the general in the summer of 1945.

  He was a tall, commanding figure with bushy eyebrows, a crew cut, riding boots, and breeches-and he carried a riding crop at all times. He looked the caricature of the cavalry officer, the sort of man who would have ridden with Ney at Waterloo or with the Light Brigade at Balaclava. In reality, he was a subtle, inventive intelligence officer, particularly skilled at managing and manipulating his age
nts. He was a brilliant linguist and completely at home in the netherworld of Viennese intrigue and suspicion. However, he was quite unsuited to the politics and posturing of Army Headquarters.

  The trouble was that, as an intelligence officer, he was constrained by the regulation chain of command to report to Lieutenant Colonel Joseph McCray, who was executive officer to Colonel Charles Bixell, who, in turn, was chief of staff to the G-2, General Thomas Hickey. This was the usual, tidy, hierarchical arrangement of all large organizations, including the Army, but unfortunately McCray and Chambers were oil and water. McCray was the pure West Point man, all spit and polish, and believed that every rule and regulation was sacred and should be followed at all times. He knew nothing of the gray, confusing world of intelligence operations and found constant cause for complaint at Chambers's unorthodox procedures. Chambers, on the other hand, was always on the brink of being court-martialed for insubordination: he could see no reason why he should have to report to anyone so indifferent to intelligence questions as Colonel McCray. Their conflict paralyzed the Vienna intelligence operations until Bixell cut the knot by transferring Chambers's operations from his own direct command to Milano's in Salzburg. Milano would supervise him and then report the fruits of his endeavors to Bixell-without disturbing him, or his executive officer, with the messy details of espionage, deceit, and the entrapment of unwary Soviet soldiers.

  The only problem Milano met with Chambers was anti-Semitism: he once expressed horror at the prospect of working with a senior agent in Vienna, Karl Brewer, a Viennese Jew who had escaped to the United States at the time of the Anschluss and had returned as an intelligence officer seven years later. (Henry Kissinger had followed the same path from Furth, in western Germany.) Milano had to assert himself very firmly to bring Chambers into line.

  Over the years, Chambers ran a series of networks in Vienna. The first, and most enjoyable, was a riding stable that he christened Operation Horsefeathers and that was put into jeopardy by the Rover Boys (see Chapter 16). Chambers was a cavalryman, and, when the dust settled after the war and he found himself in Vienna, he went looking for horses to ride. He discovered a stable run by a former Austrian cavalryman, near the Prater, the big amusement park in east Vienna in the Soviet zone. The stable had five horses, and the owner, a retired major, hired them out to Soviet officers and the occasional American. He also had a couple of French customers.

  Chambers started patronizing the stables and would ride around Vienna with the major. He soon discovered that the business was barely surviving and that its owner would be most willing to accept a subsidy in exchange for performing special services. Within a year the riding stables had become a prosperous operation with several employees and many horses. They attracted many more Russian officers, though Major Chambers himself discreetly stopped riding there regularly. As the Rover Boys episode demonstrated, the Soviets were suspicious but were never able to prove anything, and the fact that Soviet officers were still allowed to ride there suggested that the major had succeeded in covering his tracks. Operation Horsefeathers was one of the most productive American intelligence schemes, producing a steady stream of defectors. Since most of them were officers, the information they provided was particularly valuable.

  Chambers's second network was the simplest. He had a girlfriend, Sonya, whose mother and aunt worked as cleaning women at the Soviet Army Headquarters in Vienna. They proved only too willing to collaborate with the Americans, for a fee. Indeed, they recruited two other cleaning women, and the four collected all the wastepaper in the Soviet wastebaskets and turned them over to Sonya. Chambers and a team of interpreters then spent a few hours every morning going through the papers. Perhaps the Russians had never heard of shredders, or perhaps they trusted the anonymous Austrian women who cleaned their offices every night with true Teutonic zeal, leaving them spotless and tidy, however much Slavic disorder had been created there. In any event, it was a major breach of Soviet security. Chambers called it Operation Paperchase and claimed many an intelligence coup. The Russians locked their important papers in safes, out of the reach of Sonya's friends and relatives, and in any case Chambers had no wish to endanger them by asking them to steal papers. The rubbish was treasure enough. Soviet officers would draft reports and memoranda, letters and notes, they would annotate and correct them, have them retyped in clean copies to put into the safes-and then tear up the drafts and drop them in the wastebaskets. American Intelligence learned many a secret from this Soviet improvidence.

  Chambers's third operation was known as Claptrap. It was the least orthodox, and probably the most effective, of all intelligence operations in Austria. Its very name was anathema to the likes of Colonel McCray: everyone in the army used the term "clap" to designate venereal diseases, but to use it in official documents, even top secret ones, was a vulgarism that offended McCray's every sensibility. That, of course, was a further example of Chambers's deliberate insubordination or determination to needle his superiors. The code name was precise and expressive, as well as being a vulgar joke. It was a scheme for entrapping Soviet soldiers who had the misfortune to become infected by the Austrian ladies and persuading them to betray the Red Army's secrets in exchange for a cure for their afflictions.

  Chambers had discovered a young Bulgarian doctor who had studied medicine in Vienna during the war and had wisely decided to stay in Austria at the end of hostilities rather than return home. He had opened a clinic for venereal diseases in Wiener Neustadt, south of the capital, in the Soviet zone. He had a constant stream of Soviet officers and soldiers among his patients, but he had to act discreetly: catching a venereal disease was a court-martial offense in the Red Army. He could not advertise his services. The existence of the clinic and the fact that it could offer help to suffering soldiers was a secret spread by word of mouth in the Red Army. What the Russian soldiers did not know was the source of the Bulgarian doctor's success: Major Chambers had access to a supply of penicillin in the U.S. military hospital in Vienna and passed it on to the doctor. The drug was the most effective way of treating gonorrhea, syphilis, and less dangerous diseases, and the patients at the clinic were suitably grateful. The doctor and his drugs saved them not only an unpleasant disease but the probability of being summarily shipped back to the Soviet Union.

  Chambers had given the doctor a camera, with which he managed to photograph documents that his patients had with them and left in waiting rooms while they were being treated. Much more important, once he had won the confidence of his patients by promising to cure them, he was able to learn many important details of their units and their activities. The doctor spoke excellent Russian and met Chambers once a week to discuss what line of questioning he might most usefully follow. Chambers, of course, made sure that the doctor understood the need for tact. His questioning had to be casual, elliptical, indirect. Chambers was at his best in suggesting a line of unthreatening questions that would lead young, worried Soviet soldiers to unburden themselves.

  Best of all, some of the doctor's patients, particularly those who were due to be sent home, could be persuaded to defect. A number of defectors recruited in this way later found their way down the Rat Line to South America. One of the most important was a major who had been cured of gonorrhea and who himself raised the possibility of defecting. The Bulgarian doctor passed on the suggestion to Chambers, who treated the matter with great care: it was possible that the major was a double agent, sent by the KGB to follow the trail of defectors. If he were a Soviet agent and were accepted by the operations staff, he would not only expose the doctor and Operation Claptrap but would then find out all about American debriefing procedures in the Salzburg area, as well as the Rat Line.

  Chambers's solution to the problem was to send one of his Austrian agents to investigate the major. He found him billeted with an elderly Austrian lady, a woman in her sixties who was not merely anti-Communist but a secret royalist. She remained nostalgic for the golden days of the Hapsburgs. She spoke highly of the m
ajor, saying that he was an honest, interesting man who was taking lessons in German. Chambers promptly recruited her to keep an eye on the major and, after several weeks, concluded that he was perfectly genuine. The Bulgarian doctor was then told that he could tell the major that, if he were ready to desert to the West, arrangements would be made to get him to safety and then out of the country to start a new life in South America.

  The climax of that operation came when the major presented himself to his new American contact, as arranged-and brought his Austrian housekeeper with him. He told the astonished Chambers that he was worried about her security if he left her behind in the heart of the Soviet zone. Milano had to make hasty inquiries among American military families in Salzburg to find one who needed a housekeeper. It was not difficult: the Russian recommended her highly.

  In 1949, the Bulgarian doctor told Chambers that he wanted to leave. He had a thriving practice at Wiener Neustadt and had directed a steady stream of Soviet defectors to Pete Chambers, but now he was getting nervous. He assumed that sooner or later the KGB would make the connection between the defectors and their medical history and come looking for him. Besides, he had acquired an Austrian wife, they had a one-year-old child, and he had to consider their safety. Chambers came to Milano, therefore, and asked if he could arrange a passage out of Austria for the doctor and his family on the Rat Line.