The Billion Dollar Spy: A True Story of Cold War Espionage and Betrayal (30 page)

The Soviet Foreign Ministry notified the U.S. embassy that an American had been detained by the KGB. When an embassy duty officer came to the Lubyanka to get Stombaugh, a heated confrontation erupted. Krasilnikov kept insisting Stombaugh was a spy, and the embassy duty officer demanded they be allowed to leave. The embassy officer was told by Krasilnikov that Stombaugh had been detained “in the act of meeting with a Soviet citizen for alleged espionage purposes” and “the Soviet citizen in question had been arrested.”

Just before the ambush, the KGB had put an impersonator on the street to resemble Tolkachev, carrying the recognition signal, a book with a white cover in his left hand. The KGB also opened the
fortochka
in Tolkachev’s window and parked Tolkachev’s car nearby as additional enticement. Stombaugh saw the car but didn’t see the fake Tolkachev. He thought he had been free from surveillance, but the KGB was waiting.

A flash cable was sent to CIA headquarters reporting an arrest. A longer cable was sent to headquarters after Stombaugh was released, describing the ambush. Stombaugh was released after midnight, Moscow time, declared persona non grata, and expelled.
16

The incident carried an ominous meaning for those who knew of the Moscow station’s most valued asset. The KGB had the exact time and place where Stombaugh was to meet the agent. It meant the Tolkachev operation was over.

He was already in the grip of the KGB.

That same afternoon, Aldrich Ames arrived at a small restaurant, Chadwicks, on the Georgetown waterfront in Washington. Ames had wrapped up a bundle of classified messages in his CIA office and carried them out of headquarters without being stopped. He brought the cables and documents in a plastic bag to the restaurant, where he was met by Sergei Chuvakhin from the Soviet embassy. Ames gave him the materials, a colossal breach that was just the beginning of his treachery. The KGB had already detained Tolkachev, but if they had any doubts, Ames gave them further confirmation.
17

That evening, Gerber was at home on Connecticut Avenue in Washington. His wife, Rosalie, was cooking, expecting a guest for dinner, James Olson, who had worked with them in the Moscow station. Olson was the first case officer to climb into the manhole for
ckelbow
and had also met Sheymov in Moscow and worked with Rolph on the
ckutopia
exfiltration. After dinner, Gerber and Olson were scheduled to participate in an exercise on the streets of Washington, providing training in detecting, evading, and escaping surveillance to the next generation of CIA case officers. Gerber was to play the role of a spy, and the young trainees would attempt to find him while dodging or escaping the surveillance, provided by the FBI. On a warm summer evening, the exercise would require a few hours out on the streets, teaching the rookies the exacting, choreographed methods that Gerber had polished over a long career. Olson arrived with a grim face at Gerber’s apartment. The first thing he said was, “Terrible news.” The CIA had just received the message from the Moscow station that Stombaugh had been arrested.

Gerber realized instantly what that meant: Tolkachev had been lost. Gerber cared passionately about his country and about agents who risked their lives for it. A Roman Catholic, he often lit a candle at Mass for agents who had been killed in the line of duty. But after a career in espionage, he was also determined not to let setbacks slow him down. He often compared the work to that of a surgeon or a cancer doctor. He did everything he could to save the patient, but if and when a patient died, he moved on to save the next. Gerber always felt it necessary to soldier on, even with the burden of loss. He did not torment himself over whether he should have done something differently. He knew there would be all kinds of questions about Tolkachev in the morning; for now, he and Olson headed out to the street to prepare future CIA case officers in how to run a spy.
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In the weeks that followed, the Moscow station and headquarters attempted to puzzle out what might have compromised Tolkachev. The cables and messages were defensive and inconclusive. The reports and requirements branch in the division, responsible for sharing intelligence with the “customers,” emphasized that “all of
ckvanquish
’s material has been disseminated on an extremely limited basis” and that “all of the customers made a conscientious effort to keep down the number of people cleared.”
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On July 8, headquarters wrote to the Moscow station, “We cannot state definitively what might have caused his compromise.” One possibility, headquarters said, was that Tolkachev was “compromised at work through discovery of his intelligence gathering activities,” and another was that he was discovered “as a result of a security investigation” at Phazotron. Perhaps the investigation in early 1983 that had so frightened Tolkachev was still going on in early 1985 and exposed him.

There was one more embarrassing possibility. Three pages of the master copy of a top secret Tolkachev document were lost in July 1984 when they were sent to the CIA’s printing and photography division. The contents of the pages were “specific enough to compromise
ckvanquish
,” headquarters noted. No one knew what happened to those three pages.

Did Tolkachev make a mistake with all his money from the CIA? Headquarters didn’t think so. “Lavish spending does not seem to accord with what we know of
ckvanquish
’s character and conservative lifestyle, or with his statements from time to time that he viewed the money we gave him as a nest egg, or insurance against adversity,” headquarters told the station.

Was Tolkachev already under control by the KGB at the January 1985 meeting, when he turned over the cameras, with the end caps switched and the film blurred? Headquarters thought this was not likely, given the high value of the potential intelligence to the United States. The KGB didn’t like to dangle agents who could relinquish really important secrets.

All of the headquarters messages at this point were speculative and largely wrong. None of them focused on the possibility that Tolkachev was betrayed from within the CIA. But one observation was very accurate. Because the KGB knew the time, date, and place of the June 13 meeting with Tolkachev, they must have discovered the materials the CIA gave Tolkachev in January, including the meeting sites, ops note, and schedule. All of it was terribly incriminating.

“The arrest, therefore, came without warning.”
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O
n August 1, 1985, Vitaly Yurchenko went for a stroll from the Soviet embassy in Rome and never returned. He had recently been named deputy director for the KGB department that ran Soviet spies in the United States and Canada. From the street, he called the U.S. embassy and said he wanted to defect to the United States. A quiet and dignified officer, Yurchenko was debriefed by the CIA before being flown from Naples, Italy, to Andrews Air Force Base outside Washington.

Alerted to the defection, Gerber remained late in his office at CIA headquarters, waiting for details. The cable secretariat called at 8:00 or 9:00 p.m. and said new messages had come in. Gerber walked down the stairs to get them, and as he climbed the stairs back to his office, he opened the envelope, found the most recent cable, and began to read.

He felt his throat tighten. The cable reported that Yurchenko told the debriefers that the KGB had a very good source, code-named
robert
. Yurchenko did not know the true name of the source but identified him as a disgruntled former CIA trainee who was in the pipeline for the Moscow station and was subsequently fired.

Gerber suddenly felt overcome with emotion. He immediately put the pieces together: the KGB source was Edward Lee Howard, and he had betrayed Tolkachev. After all they had done to protect Tolkachev—after all the concealments, identity transfers, surveillance detection runs, electronic communications gear, Tropel cameras, and messages urging Tolkachev to be careful—the billion dollar spy had been destroyed by one of their own, by a failed trainee.
1

Yurchenko’s mention of the mystery agent
robert
led to an internal meeting at the CIA. The CIA’s quasi-independent security office wasn’t yet convinced of the link and said there were several possible candidates. But Gerber was adamant. “This is undoubtedly Howard,” he insisted. The clue was unambiguous; Yurchenko was talking about a trainee who had been fired and was in the pipeline for assignment to Moscow. That description fit Howard perfectly.
2

More than two years had passed since Howard had been forced out of the CIA, and for a long time the agency’s attitude was to keep its problems to itself. Now the CIA informed the FBI they had a problem. The person known as
robert
was Edward Lee Howard. But the hour was late.
3

Howard’s next planned meeting with the Soviets was to be in Mexico City, but he sent them a signal, changing it to Vienna. He flew there on August 6, 1985. Howard took with him his own handwritten notes about CIA matters on water-soluble paper, a trick he had learned in training. According to his wife, Mary, he received $100,000 on this trip. On August 12, he opened a Swiss bank account in Zurich and made a large deposit. The Soviets had a word of caution for Howard: One of their own officers had defected to the United States. Howard was told if he ever felt he was in trouble, he should go to any Soviet consulate.
4
On his return to New Mexico, Howard bought a metal “ammo box” and put inside $3,100 in $100 bills, $900 in $50 bills, a dozen one-ounce Canadian maple leaf gold coins, a hundred-troy-ounce bar of fine silver, and two gold Krugerrands. Howard then drove to a wooded area about three miles away from his house and buried the box.
5

The FBI began an investigation, opening a file titled “Unknown Subject, Known as Robert.” The file was created on August 5 or 6, according to an FBI official directly involved. The title of the file was changed to “Howard” within days. But the FBI did not contact Howard right away. Rather, it asked the Justice Department whether there was probable cause to arrest Howard. The response came back: no. Meanwhile, the department sought a court order to wiretap Howard’s phones, which took some time. The bureau decided not to interview Howard immediately because that might alert him and make further investigation more difficult.
6

In early August, FBI headquarters directed special agents in Albuquerque to “conduct discreet inquiries” about Howard’s whereabouts and activities. Surveillance was begun on August 29 and was “carried out in a discreet, intelligence gathering mode, attempting to determine his routines.”
7
The surveillance consisted of special FBI teams of watchers who are trained to blend in and look like civilians, as well as regular FBI special agents. With court approval, Howard’s phone was tapped, and fixed-wing airplanes were used to keep an eye on his movements. The “discreet” surveillance of Howard was carried out from 7:00 a.m. until he went to bed in the evening.

On September 3, Howard bought a $10,000 U.S. Treasury certificate. His annual salary at the Legislative Finance Committee in New Mexico was $30,000.
8

On September 10, Howard drove out into the desert about three miles, stopped, and retraced his route, all the while being watched by the FBI. At one point, he pulled over to the side of the road and turned off his car lights, attempting to spot the surveillance. The FBI decided it was time to confront him. The FBI had obtained Howard’s psychiatric evaluations and other evidence “which indicated that Howard would probably break in an interview and confess his espionage.” The word came from Washington: go ahead. Howard was put under more intensive, twenty-four-hour FBI surveillance on September 18.

The next day, he was called at his office at 2:00 p.m. and asked to come to the lobby of the Hilton hotel in Santa Fe, where the FBI wanted to talk to him. On the phone, Howard sounded concerned, but fifteen minutes later he showed up at the hotel. The FBI agents took him to room 327. He was told that he was being questioned about working with the KGB and that he had been implicated by a defector “in London.” Howard adamantly denied making contact with the Soviets and angrily accused the CIA of being out to get him. Asked about trips to Vienna, Howard quickly suggested that the FBI check the “paper trail,” his American Express card receipts, and see that he had not been to Vienna, although he mentioned he had been elsewhere in Austria in 1984 on business. What Howard didn’t say is that he had carefully avoided using the American Express card on the trip. About twenty minutes into the interview, Howard said the FBI was denying him his rights and he wanted to consult with an attorney. The FBI agents agreed; he was free to leave. Howard got up out of his seat and began to walk out of the room, but as he did, the FBI told him that if he did not cooperate, they would begin a full-scale investigation, interrogating his wife, relatives, employer, and associates. Howard reconsidered and sat down.

Then the FBI agents said Howard should take a polygraph examination at some later point, suggesting that if he were innocent, the lie detector would clear him and the FBI could look for the “true” suspect. Howard adamantly refused, saying he had been “screwed” by the polygraph in the past, reiterated that he was innocent, and again demanded time to consult a lawyer. The FBI then switched gears and said Howard would have to take a polygraph
before
seeing his lawyer. At that, Howard grew irate and said the FBI could do whatever it had to, including search his house. The FBI agents asked if he would sign a consent to be searched. Howard refused. The FBI agents said if he reconsidered, they would be around the next morning, and they gave him a phone number to call.
9

The next day, a Friday, late in the day, Howard called the FBI agents in the hotel room, saying he had talked with a lawyer and suggested that, despite his fear of the polygraph test, he might agree to go through with it, to get the FBI “off his back” and to prove his innocence. His tone seemed cooperative, a sharp change from the day before. He told the FBI that on Sunday he was going to Austin, Texas, on business and would get back in touch when he returned on Monday afternoon.
10
After Howard’s phone call, the FBI decided to revert to “discreet” surveillance, “in order to avoid antagonizing” him.
11

The FBI had trouble keeping an eye on Howard’s house at 108 Verano Loop, located in a desert area with wide open terrain. They couldn’t find a neighboring house to use for a lookout, so they parked an empty van with a video camera across the street from Howard’s low-slung single-story home. The video signal was transmitted by microwave to a trailer a short distance away and monitored by a single FBI special agent. FBI surveillance teams were also parked just outside the subdivision, to follow Howard in case he left, but they could not see the house or the exits of the subdivision. The entire watch depended on the video feed from the empty van to the trailer and on the lone agent to alert the others. The agent was assigned an eighteen-hour duty shift, from 3:00 p.m. on Saturday until 9:00 a.m. on Sunday. Inside the trailer, he thought the video image from the van was poor.

On Saturday, in the early evening, Howard and his wife hired a babysitter and went out to a local restaurant, Alfonso’s. They took their red Oldsmobile but left a second car, a Jeep, in the driveway. The lone agent in the trailer didn’t see the Oldsmobile leave, so the surveillance teams were not dispatched to follow Howard. The babysitter made calls from Howard’s home phone that were picked up by the FBI tap, but still the surveillance teams did not move. Mary even called the house from the restaurant and had a conversation with the babysitter, but this did not trigger the surveillance teams. About 7:30 p.m., the surveillance teams decided to conduct a drive-by of the house because so little had been seen or heard. Nothing unusual came from the drive-by, either.
12

The FBI completely missed Edward Lee Howard and Mary Howard. On the way home from the restaurant, Mary was at the wheel and took the car on a winding route, a surveillance detection run like those they had practiced a few years before. At one point, the car stopped near downtown, her husband jumped out, and she flipped up a makeshift Jack-in-the-Box dummy in his place. It was made from a Styrofoam head on which Ed had drawn a face; a brown wig; an orange-and-white baseball cap with the word “Navajo” on the front; a two-foot-long stick; and a tan waist-length jacket. Before he departed, Howard told his wife to drive straight home with the dummy in the passenger seat, open the garage door with the remote control, pull in, and close the door.

The ruse was taught them by the CIA. But it wasn’t necessary. No one was following them. The lone FBI agent in the trailer, supposedly watching a video feed from the van, never saw Mary Howard’s return in the Oldsmobile with the dummy in the passenger seat. The surveillance teams never spotted the Oldsmobile either. When she was back home, Mary Howard dialed the phone number of her husband’s psychiatrist and played a tape over the phone of Howard’s voice, asking for an appointment. This was intended as a diversion. The voice was picked up by the FBI wiretap.
13

After his jump from the Oldsmobile, Howard jogged to his office in Santa Fe, wrote out a resignation letter to his boss, and caught an airport shuttle to Albuquerque under the alias “J. Preston.” He flew to Tucson, Arizona. In a motel room there, he dyed his hair but didn’t like it and washed out the dye.
14
Early Sunday, he went to the airport and bought tickets for flights from Tucson to St. Louis, New York, London, and Copenhagen, arriving in Denmark on Monday morning. He paid for the $1,053 ticket on his TWA credit card. He then flew on to Helsinki.
15

While Howard was jetting off, the FBI knocked on his front door in Santa Fe. It was 3:05 p.m. on Sunday. The special agents had just received word from Texas of an interview the FBI conducted there with Howard’s friend Bosch. The FBI agents felt that Bosch had corroborated the accusation that Howard gave information to the Soviets.
16

The FBI special agents asked Mary where Howard was. Mary said he was out jogging and would return in half an hour.
17

He never did.

On Monday, a federal warrant was issued for the arrest of Edward Lee Howard on charges of espionage.
18
But he had eluded the FBI, and they would never catch up. In Helsinki, Howard contacted the Soviets on Monday and crossed the border on Tuesday, smuggled in the trunk of a car. He was granted asylum by the Soviet Union in 1986, the first CIA officer ever to defect.

In the subsequent investigation, Mary Howard was interviewed repeatedly by the FBI. She gradually revealed what she knew about his trips to Vienna and contacts with the Soviets. Mary “admitted her knowledge and participation in Ed’s espionage activities” and passed two polygraph tests, the FBI records show. With her help, the FBI dug up Howard’s buried ammo box in the desert, recovered the makeshift Jack-in-the-Box head and disguise, and learned of his Swiss bank account in Zurich. She eventually “disclosed all that could have been helpful” to the FBI. Mary continued to receive phone calls from Howard and visited him in Moscow. She was never prosecuted. They divorced in 1996.
19

Howard published a memoir,
Safe House
, in 1995, that is full of deceptions, including a denial that he betrayed Tolkachev.
20

He died at fifty years old in Moscow on July 12, 2002, as a result of a fall at his home.
21