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Empire of Secrets: British Intelligence, the Cold War and the Twilight of Empire

Язык: Английский
Год издания: 2018 год
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If the greatest wartime successes of the British secret state were against its enemies, the Axis Powers, its greatest failure was its inadequate surveillance of its ally, the Soviet Union. Britain’s intelligence services – MI5, SIS and GC&CS – were not blind to the Soviet threat during the war, even after June 1941, when the two countries became allies. As early as 1942, Guy Liddell, the chain-smoking wartime head of MI5’s B-Division, was sombrely noting in his diary, which he dictated to his secretary at the end of every working day:

There is no doubt that the Russians are far better in the matter of espionage than any country in the world. I am perfectly certain that they are well-bedded down here and that we should be making more active enquiries. They will be a great source of trouble for us when the war is over.

The problem for the British intelligence community was that investigating an ally was an extremely delicate matter. Liddell noted in his diary in 1943 that if MI5 did try to investigate the Soviet threat, which he increasingly felt was necessary, but got found out, there would be ‘an appalling stink’. As soon as the Soviet Union entered the war in June 1941, the Foreign Office placed an embargo on all British intelligence-gathering efforts on it. Apparently allies do not spy on allies – an honourable, but totally naïve, assumption when it came to the Soviet Union. We now know from Soviet archives that Moscow devoted as many resources to gathering intelligence on its wartime allies, Britain and the United States, as it did on its enemies, the Axis Powers.

Despite Britain’s intelligence services effectively having their hands tied by the Foreign Office in terms of spying on Moscow after June 1941, they tried to devise ways around the embargo. GC&CS concocted an ingenious method of sidestepping the ban, using intercepted German communications that discussed Soviet matters to gain information. MI5 also undertook measures to continue investigating the Soviet threat, opening a new department, F-Division, to investigate ‘subversive activities’ – the main focus of which was communism and Soviet activities. F-Division was led by Roger Hollis, a pre-war entrant to MI5 recruited from a tobacco firm in the Far East, who had left Oxford before taking his degree – he was described by Evelyn Waugh as a ‘good bottle man’ at Oxford. As we shall see, Hollis went on to become a Director-General of MI5, and was falsely accused of being a Soviet agent. In reality, he, arguably more than anyone else in the British intelligence community, took seriously and attempted to investigate wartime Soviet espionage, arguing that the leopard had not changed its spots. Rather than the Soviet embassy in London, which was now a forbidden fruit, the main priority for Hollis’s F-Division was surveillance of the British Communist Party. This was never going to be sufficient to detect Soviet espionage, for Soviet agents knew to distance themselves from overt communist organisations, but given the restrictions imposed on F-Division, it was the only legitimate avenue left open to it. One of Hollis’s personal triumphs was in 1942, when he organised the installation of bugging equipment in the headquarters of the British Communist Party in King Street, London. These eavesdropping microphones, codenamed source ‘Table’ or ‘special facilities’ in MI5 records, were almost certainly telephone receivers modified so as to be always switched on, thus picking up ambient conversations. As we shall see, they would provide MI5 with crucial intelligence in the post-war years about various anti-colonial ‘liberation’ leaders who communicated with the British Communist Party.

Towards the end of the war, SIS also started to focus on the Soviet threat. In 1944 it set up a new department, Section IX, the precise remit of which was the ‘collection and interpretation of information concerning Soviet and communist espionage and subversion in all parts of the world outside of British territory’. Unfortunately, the second head of Section IX (after John ‘Jack’ Curry, seconded from MI5 to SIS) was none other than the high-level Soviet penetration agent Kim Philby. Philby was arguably the most successful of the five so-called ‘Cambridge spies’ – the others were Guy Burgess, Donald Maclean, Anthony Blunt and John Cairncross – who had been recruited by Soviet intelligence before the war and then manoeuvred themselves into sensitive positions in the British wartime administration, including its intelligence services, by portraying themselves as trustworthy members of the Establishment – four of the five went to Trinity College, Cambridge. In fact, because so few pre-war MI5 and SIS officers had university degrees – most had military backgrounds, often with colonial experience – the perverse situation was that at the start of the war Soviet intelligence actually had more recruits from British universities working for it than Britain’s own intelligence services did. Coupled with their respectable backgrounds, another reason Philby and the other members of the ‘Cambridge Five’ were able to penetrate to the heart of wartime Britain was that MI5’s background checks at the time were totally inadequate: they were based on a process called ‘negative vetting’, meaning that they depended on whatever information MI5 had in its Registry. It did not carry out its own active background checks. This process overlooked a simple fact: that it was possible for agents to make themselves invisible to MI5 by deliberately distancing themselves from organisations whose membership would lead to their names being filed in its Registry – which is exactly what the five Cambridge spies did.

The story of how Philby got himself appointed as the head of Section IX is the epitome of deception and subterfuge. By a process of skilfully outmanoeuvring his rivals, particularly his immediate superior, Felix Cowgill, and playing one faction in SIS off against another, he made himself the most obvious candidate for the post. As one of Philby’s wartime colleagues in SIS, Robert Cecil, later recalled of his appointment, ‘the history of espionage contains few, if any, comparable achievements’. From his position as the second head of Section IX, Philby was able to betray all of the most important British efforts to counter Soviet espionage in the immediate post-war years to Moscow. In the years to come he would establish himself as Whitehall’s leading expert on Soviet espionage. Before his eventual exposure in the early 1950s, he was even being tipped as a future Chief of SIS – the consequences of which for Western intelligence in the Cold War can scarcely be imagined. The post-war diaries of MI5’s Guy Liddell, only declassified in October 2012, show that he struggled to come to terms with the defection of Burgess and Maclean, and the suspicion cast upon Philby, whom he trusted. Philby has justifiably been described as the greatest spy in history.


As Britain’s wartime intelligence machine began to refocus on the Soviet threat, one area provided more information than anywhere else about the operational methods used by Soviet intelligence. From 1940 onwards, the two states of Iraq and Persia (Iran) were jointly occupied by British and Soviet forces, and this led to exceptionally close collaboration between the two Allied intelligence services. Iran’s capital Tehran was also the setting in November 1943 of the famous meeting of the ‘Big Three’, Churchill, Roosevelt and Stalin, which symbolised, at least outwardly, the collaboration between the Allies. However, as Churchill later claimed, it was in Tehran that he realised for the first time how small the British nation was:

There I sat with the great Russian bear on one side of me, with paws outstretched, and on the other side the great American buffalo, and between the two sat the poor little English donkey …

From late 1944 onwards the British collaborated with Soviet intelligence in running a double agent, codenamed ‘Kiss’ – one of only two double agents run by British and Soviet intelligence together during the war, the other being Silver (see pp.50–3). Kiss, an Iranian national recruited by the Abwehr in pre-war Hamburg, was run from the inter-service British intelligence centre based in Baghdad, Combined Intelligence Centre Iraq (CICI). Under the guidance of his British and Soviet controllers, he radioed false information on British and Soviet troop movements in Iraq and Iran to the Abwehr. However, the real importance of the Kiss case, as is revealed by his MI5 file, was the proximity it gave British officials to their Soviet counterparts, allowing them to study their methods at close quarters – as the Soviets doubtless did to the British too. MI5’s DSOs in Tehran and Baghdad used the opportunity to gather as much information as they could on their Soviet opposite numbers, particularly the names and backgrounds of intelligence officers, and passed this information back to F-Division in London. MI5’s DSO in Tehran, Alan Roger, explained in one report in December 1944 that although gathering information on Soviet intelligence was not part of his official mission – the Foreign Office ban still outlawed it – he nevertheless thought that it might one day become useful. He was more right than he could have known. The Kiss case collapsed in March 1945, apparently due to bitter mutual mistrust between Soviet and British officials – a forewarning of events that were to follow with the onset of the Cold War.

Occupied Iraq and Iran gave an early indication of the kinds of problems Britain would repeatedly face in the post-war years, as relations between Western countries and the ‘great bear’ to the east deteriorated. Towards the end of the war, the head of CICI in Baghdad despatched back to London a series of stark warnings about the consequences of Britain pulling out of Iraq and Iran too quickly at the end of hostilities. If it did so, he predicted, both countries would soon be overrun by Soviet intelligence officials, who would seek to turn them into Soviet satellite states. As we shall see, this fear would greatly colour London’s reaction to colonial ‘liberation’ movements in the post-war years, as the Cold War set in.

As the war in Europe wound down, MI5 and SIS began to address the problem of the Soviet Union in earnest. In December 1944 Sir David Petrie noted that for a long time he had been ‘a complete convert to the view that the role of F. Division will appreciate in importance after the war’. After the end of hostilities in Europe in May 1945, as Petrie was preparing to leave his position as MI5’s Director-General, he circulated a long memorandum ‘on the shape of things to come’, in which he forecast – pessimistically but accurately – that one form of totalitarianism in Europe would be replaced by another. In August 1945 he held a high-level meeting with the Chief of SIS, Sir Stewart Menzies, about the problem of crypto-communists employed on secret work – on which Philby in SIS would certainly have been briefed – and on 5 September 1945 he, Hollis and other F-Division officers discussed at length, the ‘leakage of information through members of the Communist Party’. Their meeting was more significant than either Petrie or Hollis realised. Later that same day, a cypher clerk working at the Soviet embassy in Ottawa, Igor Gouzenko, defected to the West, bringing with him alarming and dramatic evidence of wartime Soviet espionage. It confirmed Britain’s worst fears. The Cold War had begun. However, before MI5 could deal properly with the new situation, it first had to deal with a different and even more urgent threat: international terrorism.

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‘The Red Light is Definitely Showing’: MI5, the British Mandate of Palestine and Zionist Terrorism (#ulink_6f3f3fb9-0ca6-5595-9647-69a28e9b71c6)

A bomb outrage to have any influence on public opinion now must go beyond the intention of vengeance or terrorism. It must be purely destructive.

JOSEPH CONRAD, The Secret Agent

I have always been clear that the best method of dealing with terrorists is to kill them.

GENERAL SIR ALAN CUNNINGHAM, High Commissioner for Palestine and Transjordan

Despite all of its wartime successes, the British secret state did not emerge from the Second World War in a strong position. Reports from the ‘high table’ of the British intelligence community, the Joint Intelligence Committee (JIC), stated frankly that it had little available intelligence on its ‘new’ enemy, the Soviet Union. The JIC’s immediate post-war reports are revealing as much for what they do not say as what they do. Although it seems incredible with hindsight, between December 1944 and March 1946 – that is, at precisely the time when we would imagine that the JIC would have been focusing on the re-emerging Soviet threat – the JIC was totally silent on the Soviet Union. Taken as a whole, JIC reports from this period do, however, shed light on the origins of the conflict that would shape the whole second half of the twentieth century: the Cold War. We can now see that in the immediate post-war period, during the transition between World War and Cold War, the JIC was relatively optimistic about Britain’s future relations with Moscow. It was certainly not expecting a war to break out between Britain or its allies and the Soviet Union.

However, by 1946 JIC reports, which were circulated to Britain’s leading military figures, a small circle of cabinet ministers and top civil servants, had begun to take a much more pessimistic and hard-line approach, and were warning that a war with the Soviet Union could erupt as the result of a series of mutual miscalculations between Western governments and Moscow. This supports the most recent research on the origins of the Cold War, offered by historians such as John Lewis Gaddis and former intelligence practitioners such as Gordon Barrass, which suggests that it arose essentially because of conflicting signals given by the West and the East, and a range of mutual misinterpretations.


The essential problem for the JIC was that between 1944 and 1946 it lacked any useful intelligence on the Soviet Union, either from SIS, GCHQ (the new name given to GC&CS at Bletchley Park after 1945) and MI5, or from their counterparts in US intelligence. This is not entirely surprising, given how difficult it was to gather any objective intelligence on the Soviet Union. As with the Third Reich, British and US intelligence found it virtually impossible to penetrate the heavy police and surveillance presence in the Soviet Union, run as a police state, and London and Washington also found it virtually impossible to understand the mindset of the post-war Soviet leadership. Churchill was close to the mark when he famously remarked in October 1939 that the Soviet Union was ‘a riddle wrapped in a mystery inside an enigma’. At the end of the war, MI5’s in-house historian John Curry lamented that the position in which MI5 found itself regarding the Soviet Union in 1945 was the same as it had been regarding Nazi Germany in 1939: it faced a complete dearth of intelligence. In reality, the situation was even worse than Curry and MI5 assumed. From his position as head of Soviet counter-intelligence in Section IX within SIS, Kim Philby almost certainly helped to prepare some of the post-war JIC papers on the Soviet threat. Through the Cambridge spies and other well-placed agents in the West, the Soviet Union was able to obtain the most sensitive secrets of Britain and other Western governments in the post-war years.

One of the priorities for British and Allied intelligence in 1945 was dismantling Axis intelligence networks. As the end of the war approached, a stream of apparently reliable reports stated that the Nazi leadership was making megalomaniacal plans to rise again if Germany were defeated. These schemes focused on Hitler’s so-called ‘Werewolf’ organisation, through which SS officers planned to orchestrate guerrilla warfare against the victorious Allies. Meanwhile, the German security service (Sicherheitsdienst) was apparently planning to disperse sabotage sleeper agents across Europe and the rest of the world to help create a Fourth Reich out of the rubble of the Third ‘Thousand Year’ Reich. The first alarming reports along those lines came to MI5 in March 1945, when a four-man team of German sabotage agents was captured and interrogated in Allied France. They had been flown in a German-captured US B-17 Flying Fortress deep behind Allied lines in France, from which they parachuted in with instructions and equipment to organise sabotage networks. The agents revealed that their sabotage colleagues had been equipped with a number of poisons, ‘not the usual ampoules of hydrocyanic acid, with which agents have been equipped in recent months to commit suicide after arrest’. Instead, they were planning to kill Allied officers with poisons infused in everyday commodities such as sausages, chocolate, Nescafé, schnapps, whisky and Bayer aspirin. They had also been instructed on how to leave arsenic and acids on books, desks and door handles.

Alarm was heightened when the Supreme Headquarters of the Allied Expeditionary Force (SHAEF) discovered sabotage plots involving secret weapons such as poisonous cigarette lighters which would kill the smoker; a belt buckle with a silver swastika that concealed a double-barrelled .32 pistol; and germ warfare ‘microbes’ that were to be hidden in female agents’ compact mirrors. SHAEF also obtained some mysterious pellets and brown capsules that would emit fatal vapours when placed in an ashtray and heated by a cigarette. These were forwarded to MI5 in London, where they were tested by the service’s expert on counter-sabotage, Lord Rothschild, and its in-house scientist, Professor H.V.A. Briscoe of Imperial College London. Although SHAEF was sceptical about some of the supposed sabotage plots, the conclusion of one of its reports in March 1945, entitled ‘German terrorist methods’, was that Allied personnel should be forbidden from eating any German foods or smoking German cigarettes, ‘under pain of severe penalties’.

However, contrary to all of the warnings and intelligence assessments made in London and Washington, the Nazi threat – and that of imperial Japan – disintegrated far more quickly than predicted. As it turned out, neither Nazi Germany nor the Japanese secret police (the Kempeitai) organised any effective stay-behind networks after the Allied victory. British intelligence nevertheless devoted significant resources to hunting down and capturing Nazi war criminals on the run. The Oxford historian and wartime SIS officer Hugh Trevor-Roper was sent by SIS to Berlin to make a detailed report on the final days of Hitler and the attempted escapes of Nazi leaders. His report eventually became a best-selling book, The Last Days of Hitler. One of the leading figures in the ‘Final Solution’, Ernst Kaltenbrunner, for example, was captured in Austria disguised as a huntsman and was then secretly transported to Britain. Though it has not been acknowledged in historical accounts to date, Kaltenbrunner’s interrogation by MI5 at Camp 020 played a significant role in his successful prosecution and execution at Nuremberg. Likewise, the notorious leader of the SS and architect of Nazi mass murder in Europe, Heinrich Himmler, was captured by the Allies as he attempted to flee across the German border in disguise. However, Himmler committed suicide in British detention, by biting into a cyanide pellet hidden in one of his teeth, before he could be brought to trial.

The political situation in post-war Britain did not create an easy atmosphere for its secret services. The new Labour government of Clement Attlee, elected in July 1945, made an election promise to keep them on a tight leash. The Labour Party had experienced difficult relations with Britain’s intelligence services ever since the scandalous ‘Zinoviev affair’ in 1924, which had led to the downfall of Britain’s first Labour government under Ramsay MacDonald. The affair involved a letter supposedly sent by one of the Soviet leaders, Grigory Zinoviev, to the British Communist Party, in which Moscow apparently implored communist fellow travellers to spread revolution to Britain and its colonies. MacDonald’s government suspected that the letter was a forgery, concocted by conservative elements in British intelligence, but the Conservative Party pounced on the scandal, and implicated the Labour Party in the affair. It is now known that the letter was indeed a fake, but it was not devised by MI5 or any other part of British intelligence: it was forged by anti-Bolshevik White Russians, probably in one of the Baltic countries.

Meanwhile, Churchill’s parting shot before he left office as Prime Minister in 1945 was to warn that a ‘socialist’ government in Britain would inevitably establish a ‘Gestapo’ and a ‘police state’. To nip Churchill’s prediction in the bud, when MI5’s wartime Director-General Sir David Petrie retired in 1946, Attlee attempted to keep MI5 under his control as much as possible, choosing a former policeman, Sir Percy Sillitoe, as Petrie’s successor. Many within MI5, probably with good reason, regarded Attlee’s choice of an outsider as a vote of no confidence. The fact was that MI5 emerged from the war judged not for its triumphs, like the Double Cross System, which remained secret, but instead on claustrophobic wartime security measures, including the temporary curtailment of civil liberties and, perhaps most notoriously, mass internment in Britain.

For Britain’s intelligence services, as for many other departments in Whitehall, the transition from war to peace witnessed a rapid wind-down. Just as after the First World War, in the years after 1945, in ‘Austerity Britain’, funding of the nation’s intelligence services was slashed, their emergency wartime powers removed, and their staff numbers drastically reduced. Many of the brilliant amateur outsiders who had joined the ranks of the intelligence services during the war returned to their pre-war professions. MI5’s staff numbers were reduced from 350 officers at its height in 1943, to just a hundred in 1946. Its administrative records reveal that it was forced to start buying cheaper ink and paper, and its officers were instructed to type reports on both sides of paper to save money. Combined with all this, MI5 also soon became demoralised. The officer who had been responsible for skilfully running its double agents section during the war, Tar Robertson, was so disheartened with the service after the war that in 1947 he took early retirement and went off to become a sheep farmer in Gloucestershire, hardly ever speaking publicly of his secret wartime exploits. There were some serious discussions within Whitehall, as there had been after the First World War, about shutting MI5 down altogether. Unfortunately for MI5, in the post-war years it faced the worst possible combination of circumstances: reduced resources, but increased responsibilities. After the war Britain had more territories under its control than at any point in its history, and because MI5 was responsible for security intelligence in all British territories, it acquired unprecedented overseas obligations.


If the British intelligence community faced an uneasy situation in the post-war period, with reduced funding, greater responsibilities, awkward relations with the Labour government and scanty intelligence on their new Soviet enemy, MI5 was confronted with an even more urgent threat. Recently declassified intelligence records reveal that at the end of the war the main priority for MI5 was the threat of terrorism emanating from the Middle East, specifically from the two main Jewish (or Zionist) terrorist groups operating in the Mandate of Palestine, which had been placed under British control in 1921. They were called the Irgun Zevai Leumi (‘National Military Organisation’, or the Irgun for short) and the Lehi (an acronym in Hebrew for ‘Freedom Fighters of Israel’), which the British also termed the ‘Stern Gang’, after its founding leader, Avraham Stern. The Irgun and the Stern Gang believed that British policies in Palestine in the post-war years, blocking the creation of an independent Jewish state, legitimised the use of violence against British targets.

As the Second World War came to a close, MI5 received a stream of intelligence reports warning that the Irgun and the Stern Gang were not just planning violence in the Mandate of Palestine, but were also plotting to launch attacks inside Britain. In April 1945 an urgent cable from SIME warned that Victory in Europe (VE-Day) would be a D-Day for Jewish terrorists in the Middle East. Then, in the spring and summer of 1946, coinciding with a sharp escalation of anti-British violence in Palestine, MI5 received apparently reliable reports from SIME that the Irgun and the Stern Gang were planning to send five terrorist ‘cells’ to London, ‘to work on IRA lines’. To use their own words, the terrorists intended to ‘beat the dog in his own kennel’. The SIME reports were derived from the interrogation of captured Irgun and Stern Gang fighters, from local police agents in Palestine, and from liaisons with official Zionist political groups like the Jewish Agency. They stated that among the targets for assassination were Britain’s Foreign Secretary, Ernest Bevin, who was regarded as the main obstacle to the establishment of a Jewish state in the Middle East, and the Prime Minister himself. Before his retirement as MI5’s Director-General, Sir David Petrie warned that the spike of violence against the British in Palestine, and the planned extension of Irgun and Stern Gang operations to Britain, meant that the ‘red light is definitely showing’. MI5’s new Director-General, Sir Percy Sillitoe, was so alarmed that in August 1946 he personally briefed the Prime Minister on the situation, warning him that an assassination campaign in Britain had to be considered a real possibility, and that his own name was known to be on a Stern Gang hit-list.

The Irgun and the Stern Gang’s wartime track record ensured that MI5 took these warnings seriously. In November 1944 the Stern Gang assassinated the British Minister for the Middle East, Lord Moyne, while he was returning to his rented villa after a luncheon engagement in Cairo. Moyne, an heir to the Guinness dynasty, was a wealthy and well-connected figure, and his assassination prompted a furious reaction from Churchill. The wartime leader had been a long-time supporter of the Zionist cause, having known the Zionist political leader Chaim Weizmann (who later became the first President of Israel) since the early 1900s, when he was an MP and Weizmann a lecturer at Manchester University, but despite his private outrage with the Stern Gang ‘gangsters’, he urged moderation. However, Moyne’s murder was followed by an escalation of violence in Palestine, with incidents against the British and Irgun and Stern Gang fighters being followed by bloody reprisals. In mid-June 1946, after the Irgun launched a wave of attacks, bombing five trains and ten of the eleven bridges connecting Palestine to neighbouring states, London’s restraint finally broke. British forces conducted mass arrests across Palestine (codenamed Operation Agatha), culminating on 29 June – a day known as ‘Black Sabbath’ because it was a Saturday – with the detention of over 2,700 Zionist leaders and minor officials, as well as officers of the official Jewish defence force (Haganah) and its crack commandos (Palmach). None of the important Irgun or Stern Gang leaders was caught in the dragnet, and its result was merely to goad them into even more violent counter-actions. On 22 July the Irgun dealt a devastating blow, codenamed Operation Chick, to the heart of British rule in Palestine, bombing the King David Hotel in Jerusalem, which housed the offices of British officialdom in the Mandate, as well as serving as the headquarters of the British Army in Palestine and all the British intelligence services operating there.

The bombing was planned by the leader of the Irgun, Menachem Begin, later to be the sixth Prime Minister of Israel and the joint winner of the Nobel Peace Prize. On the morning of 22 July, six young Irgun members entered the hotel disguised as Arabs, carrying milk churns packed with five hundred pounds of explosives. At 12.37 p.m. the bombs exploded, ripping the façade from the south-west corner of the building, which caused the collapse of several floors in the hotel, resulting in the death of ninety-one people, including British civilians, Arabs and Jews, some of whom were maimed beyond recognition, and causing a further forty-five casualties. Begin later claimed that he had given adequate warnings about the bomb, which were ignored by the British authorities: a young Irgun courier, Adina Hay-Nissan, had made three telephone calls to the hotel’s switchboard, as well as to the French consulate and the Palestine Post before the explosion. However, the reality was that, as her terrorist bosses knew well, the Irgun issued so many warnings that the British police had become blasé, and the bomb went off just fifteen minutes after the warnings, leaving little time for evacuation.

The Chief Secretary of the Palestine Mandate, Sir John Shaw, who narrowly escaped being killed in the explosion, and who went on to work for MI5, was adamant that he never received a warning about the bomb – he privately recorded in MI5 files that he was contemplating suing Begin for libel following Begin’s assertion in his book The Revolt (1951) that Shaw had ignored the warning. Shaw graphically described to Labour MP Richard Crossman how he lost nearly a hundred of his ‘best officers and old friends’ in the bombing, and in its aftermath helped to dig lacerated bodies from the rubble, attending thirteen funerals in just three days. The explosion was so powerful that the body of the Postmaster General was hurled across the street from the hotel into the YMCA, where his remains had to be literally scraped off a wall. One clerk in the hotel had his face cut almost entirely in half by shards of flying glass. A photograph from the scene shows a typewriter sitting on top of a pile of rubble, with dismembered fingers still attached to its keys. The post-war diaries of Guy Liddell reveal that in the aftermath of the bombing, Shaw made an urgent trip to London, where he briefed the JIC:

He [Shaw] was obviously considerably moved by his recent experience. The principal point of his statement [to the JIC] was his conviction that Palestinian Arabs would prove entirely intransigent. He thought that we were lucky to have got over the funerals of the Arab victims in the King David Hotel without any serious incident. He thought that it was quite on the cards that, although the Arabs knew that in a street fight with the Jews they could not hope to win, they might at any moment commit some outrage which would cause things to flare up. It might even lead to a Holy War.

In terms of fatalities, the King David Hotel bombing was one of the worst terrorist atrocities inflicted on the British in the twentieth century. It was also a direct attack on British intelligence and counter-terrorist efforts in Palestine: both MI5 and SIS had stations in the hotel.

In the wake of the bombing, the Irgun and the Stern Gang launched a series of operations outside Palestine, just as the reports coming into MI5 had warned. At the end of October 1946 an Irgun cell operating in Italy bombed the British embassy in Rome, and followed this in late 1946 and early 1947 with a series of sabotage attacks on British military transportation routes in occupied Germany. In March 1947 an Irgun operative left a bomb at the Colonial Club, near St Martin’s Lane in the heart of London, which blew out the club’s windows and doors, injuring several servicemen. The following month a female Irgun agent left an enormous bomb, consisting of twenty-four sticks of explosives, at the Colonial Office in London. The bomb failed to detonate because its timer broke. The head of Special Branch, Leonard Burt, estimated that if it had gone off it would have caused fatalities on a comparable scale to the King David Hotel bombing – but this time at the heart of Whitehall. At about the same time, several prominent British politicians and public figures connected with Palestine received death threats from the Stern Gang at their homes and offices. Finally, in June 1947 the Stern Gang launched a letter-bomb campaign in Britain, consisting of twenty-one bombs in total, which targeted every prominent member of the cabinet. The two waves of bombs were posted from an underground cell in Italy. Some of those in the first wave reached their targets, but they did not result in any casualties. Sir Stafford Cripps was only saved by the quick thinking of his secretary, who became suspicious of a package whose contents seemed to fizz, and placed it in a bucket of water. The Deputy Leader of the Conservative Party, Sir Anthony Eden, carried a letter bomb around with him for a whole day in his briefcase, thinking it was a Whitehall circular that could wait till the evening to be read, and only realised what it was when he was warned by the police of the planned attack, on information provided by MI5. General Evelyn Barker, the former head of British land forces in Palestine, was saved when his wife smelt something strange – gunpowder – as she was opening the morning post, and called the police. None of the other letter bombs in the second wave got through to their targets, but ballistics experts at the Home Office found that all the bombs were potentially lethal.

MI5’s involvement in dealing with Zionist terrorism offers a striking new interpretation of the history of the early Cold War. For the entire duration of the Cold War, the overwhelming priority for the intelligence services of Britain and other Western powers would lie with counter-espionage, but as we can now see, in the crucial transition period from World War to Cold War, MI5 was instead primarily concerned with counter-terrorism. This sensitive chapter in the history of the Cold War and Britain’s end of empire was not publicly revealed until the recent declassification of MI5 records. It also provides a remarkable new chapter in the history of modern international (trans-national) terrorism. Most studies on the subject suggest that this began in earnest in July 1968, with the hijacking of an Israeli El Al flight by Palestinian terrorists. In fact, as we can now see from MI5 records, it began over twenty years earlier. In the years after 1945, Jewish-led terrorist groups in Palestine deliberately sought to internationalise their conflict with the British. The infiltration and radicalisation of a terrorist minority from the Middle East – so prevalent among terrorist groups today – was experienced in Britain half a century ago.


Britain became the uneasy patron of Zionism when it was granted Mandatory Power over Palestine by the League of Nations in 1921. The doctrine of Zionism, the political movement seeking to establish a Jewish national homeland in Palestine, was largely derived from the writings of Theodor Herzl, in particular his book Der Judenstaat (1896). However, it was the famous (and fateful) Declaration framed by the British Foreign Secretary, Arthur James Balfour, in November 1917 that set the agenda for British policies in Palestine for the next twenty years. The Balfour Declaration provided Zionist groups with a moral, and they argued also a legal, right for Jews to settle in Palestine. Made public on the same day as the Bolshevik coup in St Petersburg, the Declaration was designed to be a rallying point for the Allies, a kind of Christmas present for beleaguered troops and governments which was also intended to whip up further support for Britain in Russia and the United States. The Declaration stated that Britain aimed to establish a ‘National Home for the Jewish People’ in Palestine, but went on to state, ‘it being clearly understood that nothing shall be done which may prejudice the civil and religious rights existing of non-Jewish communities in Palestine’. Balfour was a man of deep intellect, who in his youth had published a book defending philosophic doubt. Unfortunately, his Declaration left a good deal of doubt, failing to explain what the nature of the Jewish homeland in Palestine would be, leading to the joke that Palestine was the twice promised land.

Despite the British government’s clear wording in the Balfour Declaration of its intention to create a ‘National Home for Jewish People’, it was subsequently interpreted by many Zionists as a pledge to create a Jewish state, not just a state for Jews. The description of Palestine by the Zionist writer Israel Zangwill as ‘a land without people for a people without land’ apparently overlooked the fact that Arabs and Christians had been living there for generations. At the time of the Balfour Declaration, the Jewish community in Palestine (the Yishuv) numbered 85,000, while the Arab population was 750,000, but over subsequent years Jewish immigration steadily increased, so that by 1946 the Jewish population totalled 600,000. Growing levels of Jewish immigration to Palestine soon sparked off major Arab disturbances in response. In 1933 the Syrian Wahhabist preacher Izz al-Din al-Qassam launched pro-intifada attacks on Jews and the British police in Palestine – for which he is commemorated to this day by teams of Palestinian suicide bombers, who remember him as the leader of the first Palestinian armed nationalist grouping.

It was largely in response to increased levels of Jewish immigration that in 1936 a major Arab revolt erupted, lasting until 1939. The so-called ‘Arab Revolt’ was only put down by a tough response from the British military and police, who, backed up by the RAF, fought Arab forces in pitched battles. The British military and the Palestine police inflicted brutal interrogations on Arab insurgents, a practice that was known as ‘duffing up’ after one especially robust police officer, Douglas Duff, who before serving in the Palestine Police had been one of the Black and Tans in Ireland. British forces also collaborated with Haganah, which had been formed in 1921 in response to anti-Jewish violence in Palestine. Applying the military doctrine that the best form of defence is offence, the British military leader Captain (subsequently Major General) Orde Wingate – whose Christian beliefs made him a natural Zionist supporter – established ‘Special Night Squads’, whose ranks consisted of Haganah and British volunteers, and included legendary future Israeli military leaders such as Moshe Dayan. Wingate would later be famed for creating the Chindits, a special-forces airborne deep-penetration unit, who were trained to operate far behind enemy lines in Japanese-occupied territories in the Far East during the Second World War.

The British government generally favoured the position of Arabs in Palestine, despite the anti-British violence unleashed there during the Arab Revolt. This was because the Chiefs of Staff in London, their views coloured by nostalgic memories of Lawrence of Arabia, feared doing anything that could destabilise Palestine, which was a crucial strategic base from which to guard the eastern Mediterranean, the gateway to the Suez Canal, and the vital supply route to the subcontinent of India. The Arab Revolt revealed to London that an orgy of violence between Jews and Arabs would arise if Jewish immigration to Palestine were not restricted. Military and Colonial Office mandarins were also worried about provoking the sixty million Muslims living in India. As a result, in 1939 the British government published a White Paper limiting the number of Jewish immigrants to Palestine to a total of 75,000 over the next five years, which effectively meant a quota of 1,250 immigrants per month.

When the war in Europe broke out, the majority of the Yishuv remained strongly opposed to the White Paper, but nevertheless supported Britain in the conflict. The Zionist leader David Ben-Gurion said that Jews had to fight the war as if there were no White Paper, and the White Paper as if there were no war. The British Army quickly found recruits for a special unit it formed, the Jewish Brigade, which acted as a counterpart to the Nazi SS Division of Muslims that fought in the Balkans. However, matters soon became more complicated. In 1941 the Haganah established a special ‘commando’ unit, the Palmach, one of the aims of which was to fight anyone, including the British, who opposed increased levels of Jewish immigration to Palestine. It was during a Palmach operation that Moshe Dayan lost an eye. Furthermore, for a minority of so-called ‘Revisionist’ Zionists, even the Palmach’s ‘resistance’ against the British was not enough. Revisionists were so-called because they purported to revise the ideas of Zionism. They pursued a fanatical right-wing agenda, taking inspiration from the extremist writings of the Polish Zionist politician Vladimir Jabotinsky. Their beliefs lay in sharp contrast to the broadly left-wing politics of the majority of the Yishuv, who followed a generally socialist agenda tinged with Marxism – reflective of which is the fact that Israel did not elect a right-wing government until the 1970s. Revisionists dispensed with traditional Jewish doctrine of restraint (havlagah), rejected mainstream Zionist aspirations derived from Herzl’s writings in the 1880s, and instead believed that it was necessary to fight for the establishment of an independent and predominantly Jewish state in Palestine (eretz Israel) on both sides of the river Jordan. The cornerstones of Revisionist Zionism were a belief that the Haganah’s reliance on defence was inadequate given the wartime threat, and more offensive action was needed; that the British must be compelled to fulfil their pledges to protect and defend the Yishuv; that neither Britain nor Jews would ever placate the Arabs with political concessions or buy them off with economic development; and that an ‘iron wall’ had to be erected to separate the two peoples in Palestine.

The main Revisionist fighters were the Irgun and the Stern Gang. The Irgun had been established in 1931 in opposition to the ‘moderate’ policies pursued by the Haganah, and was led first by David Raziel and then, after 1944, by Menachem Begin, a future Prime Minister of Israel. One of the reasons Begin was chosen as the Irgun leader was that he was invisible to British intelligence and the Palestine Police. After fleeing his native Poland to escape invading Nazi forces, he was arrested by the Soviet NKVD and sent to a Gulag, from which he escaped, it seems with the assistance of Soviet intelligence, to Palestine. The Irgun guessed rightly that because of his itinerant background, Begin would not appear on Britain’s wartime intelligence’s radar. Under Begin’s command, the Irgun specialised in bombing buildings and other infrastructure, and by 1945 was estimated by British intelligence to have between 5,000 and 6,000 members – figures that were exaggerated, perhaps by as much as three times, due to the difficulties in penetrating the Irgun with agents.

The Stern Gang was an even smaller and more extremist group than the Irgun, from which it split in 1940 because the Irgun was too ‘moderate’. It was led by Avraham Stern, a romantic poet, former philosopher and gunman, whom the British eventually eliminated in 1942. The circumstances of Stern’s death were controversial. It appears that a Palestine police officer, Geoffrey Morton, shot him dead while he was unarmed and un-handcuffed, apparently as he was attempting to jump out of a window. Thereafter the Stern Gang’s leadership included the future seventh Israeli Prime Minister, Yitzhak Shamir, who was the architect of Lord Moyne’s assassination and who adopted the nom de guerre ‘Michael’ in honour of Sinn Féin’s Michael Collins. The Stern Gang’s speciality was political assassinations, and by 1945 it was estimated to have between three hundred and five hundred members – again an inflated estimate, but about the same number of trigger-pulling members as there then were in the IRA.

After the Stern Gang’s assassination of Moyne in 1944, the Haganah helped the British to track down Stern Gang members – a period known as the ‘hunting season’, or Sezon. Zionist political leaders initially hoped that the 1945 election victory in Britain of the Labour Party, traditionally a supporter of the Zionist cause, would help to ease British restrictions on Jewish immigration to Palestine. However, their hopes were soon dashed. The new British Foreign Secretary, Ernest Bevin, came to office with a background as a tough trade union negotiator, and had formerly been a supporter of the creation of a Jewish state, but within days of coming to power he changed his mind – and thus became public enemy number one for Zionist Revisionists, who regarded him as the main impediment to eretz Israel. Bevin’s policy over Palestine was not shaped by closet ‘anti-Semitism’, a claim that has often been made, but instead by his belief that a civil war would break out between Jews and Arabs if unrestricted Jewish immigration were permitted in Palestine. That said, he often displayed shocking insensitivity, joking that the US government supported mass immigration to Palestine ‘because they did not want too many Jews in New York’, and when power cuts threw one set of Anglo–Jewish negotiations in 1947 into literal darkness, he ponderously joked that ‘there was no need for candles because they had Israelites’.

The Holocaust transformed British policies on Palestine. As details of Nazi mass-murder programmes in Europe appeared in the world’s media after 1945, it became increasingly unacceptable to world opinion for Britain to block the entry of Jewish refugees into Palestine. The new US President, Harry Truman, repeatedly demanded that the British government should allow 100,000 Jewish refugees immediate entry into Palestine, even though his demand was not supported by the US State Department, which advised that Jewish immigration to Palestine should be controlled. Despite the pressure on it, the British government refused to increase substantially the Jewish immigration quota. With their hopes of securing greater Jewish immigration now sunk, all of the Zionist militias in Palestine – the Haganah, the Irgun and the Stern Gang – came together in late 1945 to fight the British in what was termed the Hebrew or United Resistance Movement.

At this stage the British were faced with what appeared to be a hopelessly irreconcilable situation. By the end of the war, some British officials were already pessimistically forecasting that Britain would be unable to square the circle in the Palestine triangle between themselves, Jews and Arabs. In 1945 the Special Commissioner in Palestine, Sir Douglas Harris, said that Britain was doing little more than ploughing sand. Not long after, the British Chancellor of the Exchequer, Hugh Dalton, complained to Attlee that it was impossible to build a firm base on a wasps’ nest.

Before 1948 several leading politicians of the future state of Israel were involved in fighting the British. Menachem Begin, one of the great pillars of Israeli politics, was denounced by the British as a terrorist, as was another future Israeli Prime Minister, Yitzhak Shamir, and at least one future Israeli Supreme Court Judge (Meir Shamgar) as well as a future Minister of Justice (Shamuel Tamir). Avraham Stern himself was subsequently commemorated on an Israeli postage stamp, and today the Israeli town of Stern is home to a number of the country’s leading political and intellectual elites. All of this leads one to ask whether it is legitimate to call these fighters ‘terrorists’. After the state of Israel was established in May 1948, the overwhelming majority of those who had fought the British refused to admit that they were ever ‘terrorists’, instead labelling themselves ‘freedom fighters’. However, the fact of the matter is that, at the time, Stern Gang operatives openly admitted to using ‘terrorist’ tactics. The Stern Gang is thought to have been one of the last groups in the world to call itself a ‘terrorist’ organisation. Some of its members apparently used the term ‘terrorism’ as a badge of honour, romanticising the role of violence. Deceitful mythologies still insist that the Irgun and the Stern Gang acted as ‘soldiers’ and were ‘freedom fighters of the highest moral standards’. As recently as July 2006 a group of right-wing Israelis, including Benjamin Netanyahu, attended a commemoration organised by the ‘Menachem Begin Heritage Centre’ for the sixtieth anniversary of the bombing of the King David Hotel, which they insisted on labelling an act of ‘freedom fighting’. A plaque commemorating the attack attracted an official response from the British ambassador in Tel Aviv, who urged that it was offensive to celebrate an act of terrorism. In reality, the Irgun and the Stern Gang targeted and killed innocent civilians. The victims of over half of the forty-two assassinations carried out by the Stern Gang and the Irgun were Jewish, supposedly acting as ‘collaborators’ with the British.

The extent to which the Irgun and the Stern Gang lacked legitimacy was seen in the fact that, after the state of Israel was created in May 1948, the new Israeli government was itself forced to deal with their threat. When David Ben-Gurion became Israel’s first Prime Minister, the firm stance he had always taken against the Stern Gang and the Irgun led to some dramatic confrontations. In June 1948 he ordered Jewish troops to fire on a boat moored off the coast of Tel Aviv, the Altalena, named after Vladimir Jabotinsky’s old nom de plume, which was bringing Jewish sympathisers and arms to the Irgun. At this point the fragile young Israeli state came closer to civil war than it would in its entire history. The episode has echoes closer to our own time. In 1995 Israel’s Prime Minister, Yitzhak Rabin, was assassinated by an ultra-Zionist Jewish extremist in a ‘revenge attack’ for proposed Israeli withdrawals from the Gaza Strip and for the fact that Rabin had been one of the troops responsible for shelling the Altalena in 1948.


In the post-war years MI5 did not have a specific department dedicated to counter-terrorism, but dealt with it under the rubric of ‘counter-subversion’, the concern of F-Division. The F-Division officers most concerned with Zionist activities were Alex Kellar and his assistant James Robertson. Kellar was a flamboyant Scot who held law degrees from Edinburgh and Columbia Universities, and was probably the inspiration for the ‘man in cream cuffs’ depicted by John le Carré in his first novel Call for the Dead (1961), played in the 1966 film (retitled The Deadly Affair) by Max Adrian wearing a dragon-patterned silk dressing gown with a purple handkerchief and a rose in his buttonhole. During the war Kellar had served as head of SIME, travelling frequently between London and the various stations MI5 maintained in the Middle East. Later, while stationed in the Far East, Kellar would memorably put in expense requests to MI5 HQ for tropical kit, including ‘two Palm Beach and one Saigon linen suitings, white shirts, drill, sharkskin dinner jackets’. Kellar’s homosexuality was widely known within MI5, a remarkable fact given that at the time homosexual practices were still illegal in Britain, and as such were regarded within Whitehall vetting circles as a potential source for blackmail. Vetters also apparently overlooked the homosexuality of the Cambridge spy Anthony Blunt. Despite his sometimes unserious appearance – he had a penchant for wearing purple socks – in the course of his thirty-five-year career in MI5 Kellar served in the front line during the last days of the British empire and the Cold War, acting as a roaming troubleshooter in successive Emergencies that broke out in Britain’s holdings across the globe.
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