The Billion Dollar Spy: A True Story of Cold War Espionage and Betrayal (33 page)

The Tolkachev story is based, in part, on 944 pages of declassified operational files, primarily cable traffic between CIA headquarters and the Moscow station from 1977 to 1985. The cables are cited individually in the notes below by sender, recipient, date, and time-date stamp. The time-date format is as follows: the first two digits are the date, the next four are the time in GMT that the cable was sent, followed by a
Z
, such as 131423Z for a cable sent on the thirteenth at 2:23 p.m. GMT. In some cables, this time-date information was redacted; they are identified by date where possible.

The CIA cables were often written in a clipped, minimalist style, with some words dropped. When quoting directly, the author has preserved this style, verbatim.

The documents were reviewed by the CIA for information considered sensitive, and that information was redacted prior to release to the author. The CIA placed no restrictions on the author’s use of the documents it released, nor did the agency review the manuscript prior to publication. Selected CIA cables are posted at
www.thebilliondollarspy.com
.

The FBI released records on the Howard investigation in response to a Freedom of Information Act (FOIA) request by the author.

The book is also based on interviews and additional documents obtained by the author from other sources.

1.
William Plunkert, correspondence with author, March 28, 2014; Moscow station to headquarters, Dec. 8, 1982, 081335Z.

2.
Barry G. Royden, “Tolkachev, a Worthy Successor to Penkovsky,”
Studies in Intelligence
47, no. 3 (2003): 22. Also Robert Wallace and H. Keith Melton,
Spycraft: The Secret History of the CIA’s Spytechs from Communism to al-Qaeda
, with Henry Robert Schlesinger (New York: Dutton, 2008), 130–31.

1.
Roberta Wohlstetter,
Pearl Harbor: Warning and Decision
(Stanford, Calif.: Stanford University Press, 1962), 48–49. Also see Joint Committee on the Investigation of the Pearl Harbor Attack, “Investigation of the Pearl Harbor Attack,” U.S. Senate, 79th Cong., 2nd sess., Report no. 244, July 20, 1946, 257–58. In his memoirs, Truman wrote that he had “often thought that if there had been something like coordination of information in the government it would have been difficult, if not impossible, for the Japanese to succeed in the sneak attack at Pearl Harbor.” Harry S. Truman,
Memoirs
, vol. 2,
Years of Trial and Hope
(Garden City, N.Y.: Doubleday, 1956), 56.

2.
Woodrow J. Kuhns, ed.,
Assessing the Soviet Threat: The Early Cold War Years
(Washington, D.C.: Center for the Study of Intelligence, CIA, 1997), 1, 3.

3.
The agency toppled leaders in Iran and Guatemala, carried out the abortive landing at the Bay of Pigs, warned of Soviet missiles in Cuba, and was drawn deeply into the Vietnam War, eventually managing a full-scale ground war in Laos. U.S. Senate, “Final Report of the Select Committee to Study Governmental Operations with Respect to Intelligence Activities,” 94th Cong., 2nd sess., bk. 1, “Foreign and Military Intelligence,” pt. 6, “History of the Central Intelligence Agency,” April 26, 1976, Report 94-755, 109.

4.
Dmitri Volkogonov,
Stalin: Triumph and Tragedy
, trans. Harold Shukman (London: Weidenfeld & Nicolson, 1991), 502–24.

5.
David E. Murphy, Sergei A. Kondrashev, and George Bailey,
Battleground Berlin: CIA vs. KGB in the Cold War
(New Haven, Conn.: Yale University Press, 1997), ix.

6.
“Report on the Covert Activities of the Central Intelligence Agency,” Special Study Group, J. H. Doolittle, chairman, Washington, D.C., Sept. 30, 1954, 7.

7.
Richard Helms,
A Look over My Shoulder: A Life in the Central Intelligence Agency
, with William Hood (New York: Random House, 2003), 124.

8.
Evan Thomas,
The Very Best Men: The Daring Early Years of the CIA
(New York: Simon & Schuster, 1995), 25, 30, 36, 142–52. Also, U.S. Senate, “Final Report,” pt. 6, “History of the Central Intelligence Agency.” Richard Immerman, “A Brief History of the CIA,” in
The Central Intelligence Agency: Security Under Scrutiny
, ed. Athan Theoharis et al. (Westport, Conn.: Greenwood Press, 2006), 21.

9.
Helms,
Look over My Shoulder
, 124, 127.

10.
Gerald K. Haines and Robert E. Leggett, eds.,
CIA’s Analysis of the Soviet Union, 1947–1991: A Documentary Collection
(Washington, D.C.: Center for the Study of Intelligence, 2001), 35–41.

11.
Kuhns,
Assessing the Soviet Threat
, 12.

12.
Richard Helms, interview with Robert M. Hathaway, May 30, 1984, released by CIA in 2004. Hathaway is co-author of an internal monograph on Helms as director.

13.
This account of the Popov case is based on five sources. William Hood,
Mole: The True Story of the First Russian Intelligence Officer Recruited by the CIA
(New York: W. W. Norton, 1982), is descriptive. Hood was an operations officer in Vienna at the time, but his account is fuzzy about some details. Clarence Ashley,
CIA Spymaster
(Grenta, La.: Pelican, 2004), is based on recorded interviews with George Kisevalter, and the author is a former CIA analyst. John Limond Hart,
The CIA’s Russians
(Annapolis, Md.: Naval Institute Press, 2003) includes a chapter on Popov. More can also be found in Murphy, Kondrashev, and Bailey,
Battleground Berlin
. Lastly, for examples of the positive intelligence and its significance, see Joan Bird and John Bird, “CIA Analysis of the Warsaw Pact Forces: The Importance of Clandestine Reporting,” a monograph and document collection, Central Intelligence Agency, Historical Review Program, 2013. On the farm journal, see Hood,
Mole
, 123.

14.
Intelligence reports based on Popov’s reporting are contained in Bird and Bird, “CIA Analysis.”

15.
He was Edward Ellis Smith, then thirty-two, who had served in Moscow as a military attaché during World War II. He went to Moscow posing as a low-level State Department official. His choices of dead drop sites were deemed unsatisfactory by Popov. See Richard Harris Smith, “The First Moscow Station: An Espionage Footnote to Cold War History,”
International Journal of Intelligence and Counterintelligence
3, no. 3 (1989): 333–46. This article is based on an interview with Edward Smith, who died in an auto accident in 1982, and on his papers. There are conflicting accounts about Smith’s role in the Popov case and whether Popov passed useful intelligence to the CIA while in Moscow. According to Hood in
Mole
, the CIA decided not to run Popov at all while in Moscow because of the risks. In contrast, Richard Harris Smith says Popov while in Moscow tipped off the CIA to the most momentous political event of the decade, Khrushchev’s secret speech to the Twentieth Party Congress denouncing Stalin on February 25, 1956. Ashley reports that Smith never met Popov. That doesn’t preclude operations, however; if he was just servicing dead drops, there would be no need for a meeting. Smith had an affair with his Russian maid, who was working for the KGB and who made surreptitious photographs. The KGB then showed Smith the photographs and tried to blackmail him into working for them. Smith refused and confessed to the U.S. ambassador, Charles “Chip” Bohlen. Smith was recalled to CIA headquarters in July 1956 and fired.

16.
Jerrold L. Schecter and Peter S. Deriabin,
The Spy Who Saved the World: How a Soviet Colonel Changed the Course of the Cold War
(New York: Scribner’s, 1992). This is the definitive work on Penkovsky, based on the CIA’s files. Also see Richard Helms, “Essential Facts of the Penkovskiy Case,” memo for the Director of Central Intelligence, May 31, 1963, and Oleg Penkovskiy,
The Penkovskiy Papers
(New York: Doubleday, 1965), which is based in large part on Penkovsky’s meetings with the U.K.-U.S. team. A recent account is Gordon Corera,
The Art of Betrayal: The Secret History of MI6
(New York: Pegasus Books, 2012), 135–83. Also see Leonard McCoy, “The Penkovsky Case,” Studies in Intelligence, CIA, date unknown, declassified Sept. 10, 2014, and “Reflections on Handling Penkovsky,” author and date unknown, Studies in Intelligence, CIA, declassified Sept. 3, 2014. Declassified CIA documents are available at
www.foia.cia.gov
, and documents older than twenty-five years via CREST, a CIA electronic search tool available at the National Archives, College Park, Md.

17.
The officer code-named
compass
arrived in Moscow in October 1960. His cover was to be the superintendent—basically, a glorified janitor—at America House, a dormitory-like building for U.S. embassy marine guards and others. Inexperienced, he found it rough going. In his letters to headquarters, he proposed that the prospective new agent toss packages of sensitive intelligence materials over the twelve-foot wall of America House at night, and he would be on the other side to catch them, a strange suggestion given that the building was under KGB surveillance.
compass
could find no other dead drop sites in Moscow and complained about his personal misery. Two months after his arrival, he had failed to make contact. On February 5, 1961, he finally tried to telephone Penkovsky at home. It was a Sunday morning. His instructions were to call at 10:00 a.m. and speak in Russian; instead, he called at 11:00 a.m. and spoke in English. Penkovsky had little English and never used it at home; he told the caller he didn’t understand and hung up. The whole
compass
effort was a dead end.

18.
Hart,
The CIA’s Russians
, 59–60.

19.
McCoy, “Penkovsky Case,” 3.

20.
Ibid., 5.

21.
Christopher Andrew, “Intelligence and Conspiracy Theory: The Case of James Angleton in Long-Term Perspective,” keynote address at a conference, March 29, 2012, Washington, D.C., sponsored by the Woodrow Wilson Center and the Georgetown University Center for Security Studies. McCoy suggests that Penkovsky’s arrest must have shaken the Soviet leadership in September–October 1962 because they did not know what he had passed to the United States. McCoy says the arrest might have undermined Khrushchev’s confidence in his response to President Kennedy. “The timing of Penkovskiy’s arrest gave Kennedy the upper hand,” he wrote. McCoy, “Penkovsky Case,” 11.

22.
Penkovsky moved about in high-level Moscow military circles, including the family of General Ivan Serov, the former KGB chief who now headed the GRU, and thus gave the West a sense of the thinking of Soviet military leaders.

23.
Schecter and Deriabin,
Spy Who Saved the World
, 147. Examples of the positive intelligence that Penkovsky provided are in Bird and Bird, “CIA Analysis,” 13–28, and the associated document collection. McCoy offers a detailed account of the positive intelligence gleaned from the operation. A more skeptical view of Penkovsky’s contribution to the Cuba crisis is offered by Len Scott, “Espionage and the Cold War: Oleg Penkovsky and the Cuban Missile Crisis,”
Intelligence and National Security
14, no. 3 (Autumn 1999): 23–47.

24.
Unknown author, “Reflections on Handling Penkovsky,” Studies in Intelligence, CIA, date unknown, declassified by the CIA Sept. 3, 2014. This monograph was written by the CIA case officer who arrived in June 1962. See p. 53.

25.
Wallace and Melton,
Spycraft
, 36–39.

26.
Unknown author, “Reflections,” 57; McCoy, “Penkovsky Case,” 9.

27.
Wynne was sentenced to eight years in prison but released in a spy swap in 1964.

28.
A large literature exists on Angleton. This account draws upon Tom Mangold,
Cold Warrior: James Jesus Angleton: The CIA’s Master Spy Hunter
(New York: Simon & Schuster, 1991); David C. Martin,
Wilderness of Mirrors
(New York: Harper & Row, 1980); David Robarge, “Cunning Passages, Contrived Corridors: Wandering in the Angletonian Wilderness,”
Studies in Intelligence
53, no. 4 (2010); and another CIA study, whose author has not been disclosed, “James J. Angleton, Anatoliy Golitsyn, and the ‘Monster Plot’: Their Impact on CIA Personnel and Operations,”
Studies in Intelligence
55, no. 4 (2011), released via the National Security Archive, Washington, D.C. Also see “Moles, Defectors, and Deceptions: James Angleton and His Influence on U.S. Counterintelligence,” report on a conference held at the Woodrow Wilson Center and co-sponsored by the Georgetown University Center for Security Studies, March 29, 2012, Washington, D.C. Also see Robert M. Hathaway and Russell Jack Smith, “Richard Helms as Director of Central Intelligence,” Center for the Study of Intelligence, CIA, 1993, 103.

29.
Robert M. Gates,
From the Shadows: The Ultimate Insider’s Story of Five Presidents and How They Won the Cold War
(New York: Simon & Schuster, 1996), 34. Also see Robarge, “Cunning Passages.”

30.
Burton Gerber, interview with author, Oct. 25, 2012.

31.
Although the tunnel had been compromised from the start by George Blake, the KGB’s agent inside British intelligence, the Soviets apparently allowed use of it to proceed unhindered, wanting above all to protect their source. For an official account of the tunnel operation, see “The Berlin Tunnel Operation, 1952–1956,” Clandestine Services History, Historical Paper No. 150, June 24, 1968, declassified in part by the CIA in 2012, included as doc. No. 001-034, chap. 1, in the document collection accompanying Bird and Bird, “CIA Analysis.” Some previous accounts have claimed the intelligence take from the tunnel was contaminated with disinformation. In an authoritative account, Murphy, Kondrashev, and Bailey,
Battleground Berlin
, say the operation “did in fact produce a large amount of badly needed and difficult to obtain military intelligence” in a period before such material became available from the U-2 overflights and satellite imagery. They also report that the KGB had its own, secure channels for communications, but the military and the GRU used lines that were tapped by the West.