Fighting to Lose (17 page)

By way of explanation, he wrote:

As you will see, each heavenly body in our solar system is “linked up” with a certain realm of things. Mars is linked up with “all that is pointed,” “all that is sharp and cutting,” with iron, steel, weapons, war, aggression and so on. Neptune is linked up with or has a bearing on “all that is hidden” and “all that is un-ordered,” with the chaotic, the intuitive, the secret. And, as Mars has a bearing on iron, Neptune has a bearing on dyes, chemicals, and oil, and also on the sea….

One of the recipients of these perambulations was the director of Naval Intelligence, Admiral John Godfrey. He was a celebrated no-nonsense officer, and it is amusing to imagine what he must have thought of it.32

Still, the nonsense aside, it was not hopeless. Britain did stand astride the world’s postal and telegraph communications like no other country, and most of the world’s letters and telegrams went through choke points it controlled. Moreover, the old chief, Admiral Sinclair, who had died of cancer the previous November, had been replaced by the talented, canny, and German-speaking Stewart Menzies, who had been with the service since 1923. He and Denniston, the Government Code and Cipher chief, had been Sinclair’s key deputies, the latter in charge of the covert assault on foreign codes and ciphers, and Menzies in charge of foreign espionage and counter-espionage, most of it throughout the 1920s and ’30s directed against the Bolshevik menace.

Menzies was fifty, a clubman, an enthusiast of the hunt, and a “somebody” in the highest social circles, ones that included the king and queen. During the First World War he had been liaison officer between army intelligence and Mansfield Cumming’s fledgling secret intelligence service MI1(c). In the interwar years, he proved to be calculating and imaginative in his covert backing of the expatriate White Russians in their deadly struggles with the Soviets. He was an Etonian, an Establishment man; Communists were far more natural an enemy for him than Germans.33

However, Hitler was the enemy now, and he had just conquered most of Western Europe. The only card of real consequence in Menzies’s hand was the gift bestowed some months before by Polish cryptologists of the theoretical solution to the enciphering machine used by the German armed forces, appropriately called Enigma. Denniston’s team had frantically applied themselves to the insights and had begun to read some of the traffic of the Luftwaffe, but this source had dried up with the collapse of France. Menzies’s best hope for the time being was to try to enlist the help of the refugee secret services whose countries had been conquered, and have his agents furrow the social circles, hotels, and bars of the remaining neutral countries, especially Portugal and Spain.

The intelligence situation must have deeply annoyed Winston Churchill. On the very day that Hitler launched his attacks in Western Europe, Churchill took over leadership of Britain’s coalition government and became prime minister. A veteran of the War Cabinet of 1914–18, he had always pressed for a robust and aggressive secret service, having supported from the outset the covert interception of private mail, the pioneering code-breaking efforts of Room 40, and the pursuit of espionage generally. He was on record as believing that “the British Intelligence Service before and during the Great War was more skilfully organized, more daringly pursued, and achieved more important results than that of any other country, friend or foe.”34 This was not what he found in 1940.

Difficult as it was at MI6, at MI5 it was infinitely worse. Two decades of concentrating primarily on fighting Bolshevik subversion at home had left it without either the tools or the mentality to fight a sophisticated foreign espionage organization. In the first eight months of the war, when Britain had been wide open to the Continent with the ferry services running normally from Norway to Portugal, all MI5 had to show for its spy-catching efforts was one middle-aged woman caught sending a five-pound note to a known pre-war German agent. Any other spies in hand had turned themselves in.

Indeed, MI5 by its own admission still had no “practical working knowledge” of the Abwehr, other than what had been reported by Owens after his cross-Channel trips, a state of affairs that continued throughout the year.35

As prime minister, Churchill was entitled to see MI5’s score card, and it would have been one of the first things he asked for. He was a war leader who counted scalps, but there were none to count.36 He also had read
The German Secret Service
(1924), written by Germany’s First World War spy chief, Colonel Walter Nicolai, and would have deduced from the book that Hitler had launched a massive espionage effort against Great Britain.37

Churchill fired Vernon Kell, MI5’s chief since before the First World War, and his deputy, Eric Holt-Wilson. The service was shocked. The pair had been a team for three decades. Now here was sixty-eight-year-old Kell, grey-faced, clearing out his desk. “I get the sack from Horace Wilson,” he bitterly noted in his diary June 10. Wilson was head of the civil service.38

Kell, who had been at the centre of so many national secrets for so long, resented being abruptly terminated like any ordinary bureaucrat. He died suddenly in March 1942.39

Churchill turned over ultimate control of MI5 to a high-level panel he set up within a week of taking power. The Home Defence (Security) Executive was tasked with coordinating the security activities of the War Office, the Home Office, and the Commander-in Chief, Home Forces, the latter’s job being to prepare England for invasion. For chairman, Churchill chose Lord Swinton, formerly Philip Cunliffe-Lister, MP, who had been made secretary of state for air in 1935 to oversee the secret buildup of Britain’s air defences, leaving the post in 1938. He interpreted his new mandate as being directly responsible for MI5 and proceeded to overhaul it by putting in his own people. Administrative chaos ensued.

A Mr. Crocker became joint head of B Division with Guy Liddell, who took over from Brigadier Harker when the latter moved up to replace Kell as chief. Robertson became the assistant to a Mr. Frost in the new “W Branch,” the
w
standing for “wireless.” The new section’s mandate, building on the experience gained from running the SNOW transmitter, was to detect enemy agents by their intercepted communications, with illicit letters, lights, signals, and pigeons thrown in on top of wireless. Non-wireless double agents remained in a separate section under Major Sinclair.

Expansion of the service went out of control. New people were brought in merely because they were a friend of a friend, sometimes without the administrative staff being consulted beforehand, or even told after. There was no training, no corporate memory to be shared, no required reading list. Every officer got his own department. Co-operation up the chain of command or laterally was token or nil.

MI5 did recover eventually, with the 1941 reorganization carried out by veteran Indian Police officer David Petrie, but throughout the remainder of 1940 and into the early months of the following year, it was a dysfunctional Humpty-Dumpty organization whose pieces made no sum. It is against this background that MI5’s further actions should be viewed.40

On the German side, it was the complete opposite. The Abwehr had performed superbly. Based on the recommendations of his First World War predecessor, Colonel Walter Nicolai, Canaris had built up an organization that had outfoxed, outmatched, and outplayed all its secret service adversaries: Belgian, Dutch, French, and British. The triumph was complete, down to the detail of deploying special Abwehr reconnaissance units behind the advancing German armies to sweep up the documents left behind by enemy headquarters units that had been overrun. It was magnificent, and tragic; Canaris had betrayed his own cause.

Canaris had delivered Hitler his victory; there is no getting around it. He did not have to tell Hitler the enemy was weak in front of the Ardennes; he could have said they were strong. He had given Hitler good intelligence, and the Führer had acted upon it.

One can imagine the Abwehr chief’s discomfort as he watched Hitler basking in the glory. The German people now adored him. He was cheered whenever he appeared in public; young girls pelted him with flowers and swooned before him. Most of the doubting generals now allowed that he might be a military genius, or at least credited him with that superior intuition that the Prussian military caste believed was the mark of a great commander. The likes of Italian dictator Benito Mussolini, and the war party in Japan, saw their own ambitions mirrored in his success, with Mussolini declaring war on France mere days before its surrender. All this had been made possible because Canaris had decided to help Hitler.

Most devastating of all, the common soldiers and young officers of the German armed forces now worshipped Hitler. They would willingly and blindly lay down their lives for him. No chance now of Canaris using the Brandenburg Regiment in a coup attempt. The elite Abwehr commandos, trained to the teeth by the Nazi-hating Colonel Heinz, were proud of their exploits behind enemy lines and of their seizure of key bridges over Holland’s canals. An order to act against Hitler would not be obeyed. Overthrowing a criminal regime had suddenly become infinitely more difficult.

Canaris, with Halder and the other dissident generals, undoubtedly felt he had had no choice. Hitler was still legally head of state and head of government. They could arrest him, or even kill him, but so long as he was Führer and chancellor, by right of majority vote in the Reichstag, they had a soldier’s moral obligation to obey him. Once General Halder backed away from the planned coup, there was nothing for it but to try to make the attack against France succeed. At the very least, the army leadership owed it to the ordinary German soldier. Victory saves lives; defeat loses them.

Canaris was a man of normal sensitivity. It must have plucked at his conscience when it sank in that in order to give Hitler victory he had exploited the loyal Oster and the honest Beck. The latter had been seized with wonderment and disbelief as he followed the sweep of the German army through northern France. His whole argument had hung on the premise that the offensive would be quickly halted. He was totally mystified. “Beck stands before the carelessness and bad leadership of the English and French as before a riddle,” one of his co-conspirators wrote.41

The answer to the riddle was Canaris. He had made it happen.

For now, Canaris could only hope that Hitler would be content to consolidate his gains while the conspirators reorganized to deal with him afresh. Assassination perhaps? There was no shortage of volunteers. Eliminate Hitler, eliminate the Nazis, and a responsible Germany would return, stronger than ever. The British could again be brought to the table.

Or could they?

Venlo and the Vatican. They would be remembered by the British. They would be seen as two very good reasons why German offers to stop the fighting could not be trusted.

7

May–August 1940

Earlier that spring, before Hitler’s invasion of the Low Countries, Ast Hamburg’s Major Nikolaus Ritter — a.k.a. DR. RANTZAU — pondered a problem. He knew that when Belgium and Holland were overrun, as soon they would be, it would be the end of Arthur Owens’s easy cross-Channel excursions. Yet DER KLEINER — the LITTLE GUY — was irreplaceable. Not only had he been the first to alert the Abwehr to British advances in radar, and to the existence of Britain’s coastal radar network, but Ritter could mentally check off many other accomplishments:

He reported on ship movements, RAF concentrations of aircraft in England and France, the delivery of war materials from the United States, the strengthening of coastal defences, the disposition of balloon barrages, the formation of merchant vessel convoys, the camouflaged locations of fuel dumps. He also gave daily weather reports, often both morning and evening….1

Owens had been head and shoulders above all other spies for three good reasons: he was inside British intelligence as a trusted double agent; he was allowed to travel Britain unsupervised; and MI5 accepted in principle that a double agent could be allowed solo visits to the Continent to confer with his German masters. Even having access to a secret transmitter, which Owens may have had, could not match the latter. The trick for Ritter that spring was to find a way for Owens to continue these in-person encounters.

Having meetings at sea was one possibility, and at their April meeting he and Owens discussed the idea, the latter mentioning that he had a Welsh fisherman friend who might be willing to help. They also discussed Owens getting certain “secret papers from aerodromes.” A month later, on May 8, A-3504 wirelessed Hamburg: “Have applied for exit permit [for Holland]. Have secret documents. Order of battle RAF. When can we meet?”2

Two days later, Hitler launched his attack on France and the Low Countries. A meeting at sea it would be.

MI5 procured the fishing boat and crew, and presumably the RAF documents promised to Ritter. It also planted on Owens a confederate who was to accompany him to the rendezvous. This was a long-time MI5 informer named Sam McCarthy.3