Enemies: A History of the FBI (28 page)

PARANOIA

T
HE
U
NITED
S
TATES
was the most powerful force on earth in the spring of 1949. “
She bestrides the world like a Colossus,” a British historian wrote that year. “No other power at any time in the world’s history has possessed so varied or so great an influence on other nations.” The British Empire had collapsed. The Soviets had lost twenty-seven million dead in the war. China was in chaos as a Communist army strode toward its capital. Germany and Japan were crushed and under occupation. The United States had half the world’s wealth, half its material production, two-thirds of its machines, and its only atomic arsenal. Yet before the year was out, the United States would lose its monopoly on the atomic bomb, and with that loss came a sense of intense peril at the highest levels of government.

Hoover learned that Soviet espionage had penetrated the CIA, the Pentagon, the Justice Department, and the FBI itself.

The year began with an electrifying breakthrough by Venona. Fifteen newly decoded Soviet wartime cables described a woman who had held a job in the Economic Warfare Division of the Justice Department in New York in 1944. She had moved to Washington in 1945 to take another job at Justice—a far better posting from the Soviet point of view. She worked at the Foreign Agents Registration Division, in liaison with the FBI, tracking the political operatives of foreign powers.

Her cover name was Sima. “
She gives the impression of a very serious, modest, thoughtful young woman who is ideologically close to us,” reported her KGB recruiter.

The FBI quickly determined that only one woman at Justice fit Sima’s profile. Her name was Judith Coplon and she had the security clearance to
see classified FBI records in the Foreign Agents files, a wealth of data recording the pursuit of Soviet spies and American Communists.

Hoover had to choose a strategy to use against her. The Bureau moved fast. It was inside a Soviet espionage operation, watching it as it happened.

First came wiretaps on Coplon’s home and office, the home of her parents, and the New York residence of a Soviet she had telephoned, Valentin Gubitchev, who worked at the United Nations but was clearly a Soviet spy. Fifty agents worked around the clock monitoring and recording the wiretaps. Then the FBI’s Bob Lamphere set up a sting. He created a phony document showing that an attorney for Amtorg, the Soviet trading group in New York, was an FBI informant, and he slipped it like a baited hook into the stream of paper Coplon saw at work at the Justice Department. She stole it.

The FBI overheard Coplon planning a trip to New York to see Gubitchev. Agents went to Assistant Attorney General Peyton Ford for an arrest warrant. He told them they lacked sufficient evidence. He said Coplon could be arrested only if she were caught in the act of handing over classified documents to an agent of a foreign power. On March 3, 1949, Coplon took the train to New York. A team of FBI agents followed her. Coplon and the Soviet spy saw they were being shadowed. She never gave him the documents. The FBI nonetheless arrested them, without a warrant.

Coplon faced two trials: one, in April, on the charge of stealing secrets in Washington; the second, in November, on the charge of espionage in New York. They proved to be disasters for Hoover and the FBI.

Coplon was a spy, without question. But the FBI had broken the law trying to convict her. The Bureau illegally wiretapped her telephone conversations with her lawyer. At the first trial, an FBI special agent on the witness stand denied that Coplon’s phone had been tapped, a lie that was later detected.

Then, to Hoover’s dismay, the judge admitted into evidence FBI reports alluding to the search for information on the Soviet atomic spy ring—a threat to the secrecy of Venona.

To protect the intelligence secrets of the FBI from exposure by the court, Hoover instituted a new internal security procedure on July 29, 1949. It was known as June Mail—a new hiding place for records about wiretaps, bugs, break-ins, black-bag jobs, and potentially explosive reports from the most secret sources. June Mail was not stored or indexed in the FBI’s central records but kept in a secret file room, far from the prying eyes of outsiders.

FBI headquarters issued a written order to destroy “all administrative records in the New York field office”—referring to the Coplon wiretaps—“in view of the immediacy of her trial.” The written order contained a note in blue ink: “
O.K.—H.”

Despite Hoover’s efforts, the existence of the wiretaps was disclosed at the second trial—another layer of the FBI’s secrecy penetrated. Then the same FBI special agent who had lied at the first trial admitted that he had burned the wiretap records.

Coplon was found guilty, but the verdict would not stand. Judge Learned Hand, who heard Coplon’s appeal, overturned her twenty-five-year sentence. He publicly rebuked Hoover—a rare event in American jurisprudence. In the words of the FBI’s Bob Lamphere, who led the investigation, Hoover was furious about “
the entire Coplon affair—especially in the reversal of the conviction.” The judge reminded the FBI that the Supreme Court’s ban on wiretapping was still the law of the land. The ban was based on “broad considerations of morality and public well-being.” The warrantless arrest was illegal. The evidence seized from an illegal arrest was inadmissible—“a fruit of the poisonous tree.” Judge Hand also wrote that the defense should have had the right to identify the FBI’s original “confidential informant” in the case. That source, of course, was Venona, the deepest secret of American intelligence.

The FBI had been caught breaking the law again. For the first time since the raids of 1920, lawyers, scholars, and journalists openly questioned the powers that Hoover exercised. Almost everyone agreed that the FBI should have the ability to wiretap while investigating treason, espionage, and sabotage. Of course taps would help to catch spies. But so did opening the mails, searching homes and offices, stealing documents, and planting bugs without judicial warrants—all standard conduct for the FBI, and all of it illegal. Even at the height of the Cold War, a free society still looked askance on a secret police.

“T
HEREFORE
R
USSIA KNOWS
”

Hoover increased the pressure on his agents to break the secrets of Soviet espionage. The KGB saw the manhunt coming, thanks to its well-placed spies inside the American and British intelligence services.

The American spy-hunters consulted regularly with Peter Dwyer, the
chief representative in Washington of the British foreign intelligence service, MI6. In August 1949, Dwyer relayed some recent Venona decryptions from the FBI to the chiefs of British intelligence in London.

They included a five-year-old Soviet cable that contained a verbatim quote from a naturalized British subject, a leading atomic scientist named Klaus Fuchs, who had worked on the Manhattan Project. It showed that Fuchs had served as a Soviet agent at Los Alamos while America was perfecting the bomb. A first-rate theoretical physicist and a hard-core Communist who had fled Hitler’s Germany, he proved the best source of secret intelligence for the Soviets on the atomic bomb and its far more powerful successor, the hydrogen bomb.
By September 7, 1949, informed of the evidence against Dr. Fuchs, the British were trying to decide how to arrest and convict him without revealing Venona as the source of their knowledge.

On September 20, the CIA issued a report saying the Soviets probably would not produce an atomic weapon for four more years. Three days later, President Truman announced to the world that Stalin had the bomb. American planes had picked up the radioactive fallout from the secret Soviet test. The balance of terror shifted.

Hoover sent his agents across the country to interrogate the scientists who had worked with Fuchs. The Americans pressed the British to prosecute him. He finally broke on January 31, 1950, after weeks of intense interrogation in London. Harry Truman decided publicly, at almost precisely the same hour, to build the hydrogen bomb. The president’s decision coincided with Hoover’s warning that Fuchs had enjoyed almost unlimited access to the secrets of Los Alamos, including long-term research on the H-bomb.

“
Fuchs knew as much about the hydrogen bomb as any American scientist; therefore Russia knows,” the FBI reported days after he confessed.

The FBI was desperate to find the rest of the ring that had stolen the secrets of the bomb. But British diplomats barred the Bureau from questioning Fuchs until after a formal sentencing. Hoover called the delay an outrage—especially since it was the British who had recommended Fuchs for the Manhattan Project. Precious weeks passed before the FBI questioned the spy. Fuchs withheld a good deal in his answers, much of it concerning the technological leap from atomic to nuclear bombs. But the Bureau got what it wanted: an airtight identification of the courier who had connected Fuchs to the Soviet espionage underground in America.

His name was Harry Gold, and he had been a Soviet intelligence agent in the United States for fifteen years. His name had been in the FBI’s files since 1947. Agents from the Bureau’s New York office had interviewed Gold, and he had freely admitted being part of the network of wartime Russian agents served by Elizabeth Bentley. “
But after that connection with Gold, three years went by,” said FBI special agent Donald Shannon. The interview had been sent to FBI headquarters, filed, and forgotten.

Hoover discovered, to his intense chagrin, that the FBI had overlooked its own records on Klaus Fuchs for four years. They were English translations of captured German army documents, and they had been in the FBI’s possession since shortly after the end of World War II, when Fuchs was still spying for the Soviets in the United States. They revealed that Fuchs was well-known as a “communist of relatively important character.”

The fault lay with a brilliant but erratic FBI counterintelligence supervisor named William K. Harvey. Hoover had fired him for alcoholism in 1947; he had then joined the CIA. The evidence went unseen until after Fuchs confessed.

“
Take note,” Hoover wrote to his national security chief on February 16, 1950. “We can’t tolerate such slip-shod methods.”

“W
HAT THE COMPETITORS HAVE
”

The KGB knew with uncanny precision how the case would unfold after Fuchs confessed. It predicted that Fuchs would give up Gold, and that Gold would betray the rings of Soviet spies and couriers who had worked to obtain America’s atomic secrets. The KGB lamented: “
What the competitors have on them is not only their clear and incontrovertible involvement in our work, but also evidence that they passed secret materials on the atomic bomb to us.” The “competitors” were the FBI.

The KGB’s knowledge came from a Soviet spy named William Weisband. He had been inside Venona headquarters at Arlington Hall for five years.

Much about Weisband remains mysterious today, including his birthplace—Alexandria, Egypt? Odessa, Russia?—and the year he first came to the United States. He likely trained at the Comintern’s Lenin School in Moscow during the early 1930s. He spoke fluent Russian, unaccented English, and fair Arabic. By 1936 he was working as a courier for Soviet intelligence in
New York. He became an American citizen in 1938. He joined the United States Army and he served with Signals Intelligence in England, Italy, and North Africa.

Weisband came to Arlington Hall as a Russian translator in 1944. He was a social animal, affable in the extreme. “
At the Hall he had a reputation as a stroller. He wandered around, chatting and picking up pieces of gossip,” reads a secret history of the case prepared by the National Security Agency. “He was also adept at getting himself on distribution for documents that did not directly concern the work of his section. Highly gregarious, Weisband had a wide circle of friends … His postwar wedding party was talked about as a who’s who of Army cryptology.” His new wife also worked at Arlington Hall.

From February 1948 onward he sent Moscow reams of intelligence describing Venona. In short order, Moscow changed its codes. The Soviets “
implemented a set of defensive measures, which resulted in a significant decrease in the effectiveness of the Amer. decryption service,” Weisband’s KGB file shows. Six weeks before the Soviets tested their first atomic bomb, he reported that American intelligence “was all of a sudden no longer able to read our cipher telegrams.”

The secret National Security Agency history picks up the story. “The FBI began piecing together information” on why Venona had gone dark. The Bureau “was aghast to learn in 1950 that Weisband was employed at Arlington Hall” as a section chief working on the Soviet cables. He was arrested, but he never talked. He served a year in prison for contempt of court after he refused to testify before a federal grand jury. He worked in and around Washington selling cars and tending apartments for sixteen years before he died.

The penetration paralyzed the progress of Venona. For the next three decades, the United States could not read the Soviets’ most secret messages. It could only look backwards, trying to decipher old cables from the 1940s.

The FBI never found out what Weisband told the Soviets. The National Security Agency history concludes: “His case instilled a certain paranoia within the profession.”

That paranoia afflicted the FBI. Hoover insisted that the FBI would create and control its own system for secret communications. “
Mr. Hoover was not one who trusted anyone,” said the FBI’s Ronald M. Furgerson, a leading cryptanalyst at the Bureau. “He was afraid that the National Security
Agency, which manufactured everybody else’s cryptographic equipment, might have been infiltrated.”

Weisband had burrowed into American intelligence from the bottom up. Now another Soviet spy penetrated it from the top down.

Hoover had been convinced from the first that the CIA would be an easy target for Soviet spies. In October 1949, a suave and smooth-talking new MI6 man arrived in Washington, and in time he would personify Hoover’s fears.