The Defence of the Realm (13 page)

Research in German archives demonstrates that Kell's Bureau did not succeed in identifying all the German agents present in Britain at the outbreak of war. It seems, however, to have rounded up all those that mattered. There is no evidence that in the critical early weeks of the war any worthwhile intelligence reached Germany from Britain. Holt-Wilson later recalled:

A German Order came into our hands early in the war which disclosed the fact that as late as the 21st August (i.e. 17 days after war was declared), the German Military Commanders were still ignorant of the despatch or movements of our main Expeditionary Force, although this had been more or less common knowledge to thousands in this country.
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There was, of course, much that Kell's small Bureau had not discovered about German intelligence work during its first five years. Its central error was to believe that German military as well as naval intelligence was operating in Britain. In reality, before the outbreak of war German military intelligence (Sektion IIIb) concentrated exclusively on Russia and France; indeed, intelligence from its agents in Russia helped to alert the Prussian General Staff to Russian mobilization at the end of July 1914.
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Kell's belief that Sektion IIIb was also targeting Britain was not, however, a foolish mistake for a young intelligence agency. The head of Sektion IIIb, Lieutenant Colonel Walter Nicolai, later revealed that, though ‘Time had not sufficed to extend this organisation to England, this was, indeed, to have been the next step in the organisation of our I[intelligence] S[ervice].'
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2

The First World War

Part 1: The Failure of German Espionage

War with Germany raised British spy mania to unprecedented heights. On 4 August 1914, the day that Britain went to war, Basil Thomson, Assistant Commissioner at Scotland Yard in charge of the Criminal Investigation Department (CID), whose responsibilities also included the 114-man Metropolitan Police Special Branch (MPSB),
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was informed that secret saboteurs had blown up a culvert near Aldershot and a railway bridge in Kent. An inspection next day found both to be intact. Spy mania, wrote Thomson later, ‘assumed a virulent epidemic form accompanied by delusions which defied treatment': ‘It attacked all classes indiscriminately and seemed even to find its most fruitful soil in sober, stolid, and otherwise truthful people.' Reports flooded in of German agents planning mayhem and communicating with the enemy by a variety of improbable means. All were false alarms.
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The Home Secretary, Reginald McKenna, sought to calm public fears on 5 August by announcing to the Commons that twenty-one spies and suspected spies had been arrested ‘all over the country' in the past twentyfour hours, ‘chiefly in important military or naval centres'.
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In his anxiety to reduce spy mania, however, McKenna had jumped the gun. Seven of the German agent network identified by Kell had still to be arrested.
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New legislation gave the government unprecedented powers to deal with aliens and suspected spies. The Aliens Restriction Act, drafted by the Home Office in consultation with Kell and Holt-Wilson,
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in readiness for war, was rushed through parliament on 5 August and gave the government carte blanche ‘to impose restrictions on aliens and make such provisions as appear necessary or expedient for carrying such restrictions into effect'. The Defence of the Realm Act (DORA), also drafted in consultation with Kell and Holt-Wilson,
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which became law three days later, gave the government powers close to martial law:

 i  to prevent persons communicating with the enemy or obtaining information for that purpose or any purpose calculated to jeopardise the success of the operations of any of His Majesty's Forces or to assist the enemy; and

 ii  to secure the safety of any means of communications, or of railways, docks or harbours.

Enemy aliens were required to register with the police and forbidden to live in a large number of ‘prohibited areas' without police permits.
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Kell and the other army officers on the retired list in his Bureau were mobilized for war service as general staff officers (GSOs).
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The Special Intelligence Bureau (SIB), as it continued to style itself, was integrated into the War Office as MO5(g) and its responsibilities extended to include ‘military policy in connection with civil population including aliens' and the ‘administration of the Defence of the Realm Regulations in so far as they concern the M[ilitary] O[perations] Directorate'.
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Its role, however, was kept secret. MO5(g) policy, approved by Whitehall, was to conceal ‘the very existence of a British Contre-Espionage Bureau'.
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The new wartime legislation did little in the short term to calm spy fever. When McKenna made a further attempt to allay public anxieties on 9 October by claiming that pre-war spies had obtained ‘little valuable information' and that the whole German spy network had in all probability been ‘crushed at the outbreak of the war',
The Times
was ‘more than a little incredulous': ‘It does not square with what we know of the German spy system . . . In their eager absorption of the baser side of militarism, the Germans seem to have almost converted themselves into a race of spies.'
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Security Service files still contain a small sample of the letters forwarded to it by the War and Home Offices from correspondents as deluded as those who had contributed to the spy scares of Edwardian England. An army officer, based in London, reported,
inter alia
, that ‘Haldane is the first and foremost spy. His houses should be raided, as he has got a wireless set behind the cupboard in one of his bedrooms.' Other correspondents claimed that German coalminers in the Kent coalfields had dug a series of tunnels which were to be used for wartime sabotage. According to a correspondent from East Ham, one of the tunnels passed under Canterbury Cathedral.
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The spy scares which followed the outbreak of war gave William Le Queux a new lease of life. He was, he declared, ‘not affected by that disease known as spy mania' and was full of praise for the ‘unremitting efforts' of Kell's Bureau, which he referred to as ‘a certain nameless department, known only by a code number'. Le Queux fraudulently claimed to be
'intimate with its workings': ‘I know its splendid staff, its untiring and painstaking efforts, its thoroughness, its patriotism, and the astuteness of its head director, who is one of the finest Englishmen of my acquaintance.' But he now considered the scale of the spy menace altogether beyond the capacity of Kell's ‘nameless department': ‘The serious truth is that German espionage and treasonable propaganda have, during past years, been allowed by a slothful military administration to take root so deeply that the authorities today find themselves powerless to eradicate its pernicious growth.'
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Milder forms of spy fever were common even among those who escaped the wilder fantasies of Le Queux and his readers. They were strengthened by the sinking of three British cruisers by U-boats in the North Sea on 22 September. Admiral Lord Charles Beresford, MP for Portsmouth and former Commander in Chief of the Channel Fleet, told a recruiting drive on 2 October: ‘Three cruisers were lost by information given from this country to the German Admiralty. The British people should insist that the Home Office prevent the British Army and Navy being stabbed in the back by assassins in the shape of spies. All alien enemies should be locked up!' Soon afterwards he claimed in a letter to the press: ‘Numbers of men have been caught red-handed signalling etc. and have been discharged through not enough evidence.' Requests to Beresford from the Director of Public Prosecutions for evidence to support his claims brought only confused and choleric replies. The Attorney General, Sir John Simon, however, was inclined to believe Beresford's explanation for the sinking of the cruisers. He wrote privately on 26 October:

Experience has shown that the German Navy is extraordinarily well informed of our movements, and though I have the greatest detestation of spy mania, I do not think it is open to doubt that there are a number of unidentified persons in this country, who have been making treacherous communications, and who were not known to us at the beginning of the war.
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MO5(g)'s growing responsibilities, combined with serious concern within and beyond Whitehall at the threat from German espionage, led to a steady expansion in its staff which continued throughout the war. By the end of 1914, MO5(g)'s staff had more than doubled in the four months since the outbreak of war (from seventeen to forty), but was still far too small to deal with the rapid increase in its work. An intensive recruitment campaign produced 227 new recruits in the following year.
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Many officer recruits were men who had been wounded on the Western Front or other theatres of war, and been declared unfit for active service. A wartime
cartoon shows a new recruit telling a visiting general: ‘Oh, they knocked a piece out of my skull, so they sent me to the Intelligence Dept.'
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Some recovered sufficiently to return to the Front. In 1915, to cope with increasing numbers, MO5(g) acquired rooms in Adelphi Court, a block of flats next to its HQ at Watergate House, York Buildings, Adelphi. Later, the whole block was acquired.

The most remarkable of MO5(g)'s early wartime recruits was the twenty-year-old William Edward Hinchley Cooke, the bilingual son of a German mother and British father, who had been to school in Dresden before becoming a student at Leipzig University. Early in 1914 he had also begun working as a clerk at the British legation in Dresden and, after being expelled with the rest of the legation at the outbreak of war, was strongly recommended to Kell by the minister, A. C. Grant Duff: ‘He is entirely British in sentiment and the fact that he speaks English with a foreign accent must not be allowed to militate against him.'
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Hinchley Cooke joined MO5(g) on 21 August and went on to become one of the few Security Service officers to serve in both world wars. In an attempt to counter the suspicion provoked by his German accent, Kell felt it necessary to write on Hinchley Cooke's War Office pass: ‘He is an Englishman.' Hinchley Cooke's first assignment was to liaise with Basil Thomson at Scotland Yard, ‘examining and reporting on the papers of enemy subjects, for which', Kell believed, ‘his unique knowledge of German rendered him specially fitted'. Hinchley Cooke's skill in interpreting cryptic allusions in the correspondence and papers of espionage suspects, as well as an alertness to the use of secret inks before testing for them became routine, made him, in Kell's view, ‘largely responsible for the arrest of several German spies'.
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Another early wartime recruit to MO5(g) was a fifty-two-year-old Cambridge-educated barrister at the Inner Temple, Walter Moresby, son of Admiral John Moresby, who lived near the Kells' home in Weybridge, Surrey, and joined in October 1914 as the Security Service's first legal adviser. His appointment reflected Kell's need for an experienced lawyer to advise on the increasingly complex wartime Defence Regulations as well as the high-profile prosecutions of German spies.
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The unpublished memoirs of Kell's wife Constance describe the Moresbys as ‘our cousins': ‘We saw much of them and they became great friends.'
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On 1 October Kell divided MO5(g) into three branches:

MO5(g)A: ‘Investigation of espionage and cases of suspected persons'

MO5(g)B: ‘Co-ordination of general policy of Government Departments in dealing with aliens. Questions arising out of the Defence of the Realm Regulations and the Aliens Restriction Act'

One of Kell's first wartime recruits: William Edward Hinchley Cooke, son of a German mother and British father. (i) Hinchley Cooke's War Office pass, certifying that ‘He is an Englishman' (despite his German accent). (ii) Bogus Alien Enemy Certificate of Registration card used by Hinchley Cooke when posing as the German Wilhelm Eduard Koch.

MO5(g)C: ‘Records, personnel, administration and port [immigration] control'
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As before the war, MO5(g)'s main investigative resources were its Registry and letter checks. Increased wartime responsibilities for ‘suspected persons', aliens and immigration control at ports led to a steady expansion in its records. By the spring of 1917 MI5's Central Registry contained 250,000 cards and 27,000 personal files on its chief suspects kept up to date by 130 women clerks. Major (later Colonel Sir) Claude Dansey, then responsible for liaison with the United States, told American military intelligence that the Registry's filing system was ‘our great standby and cornerstone': ‘We have brought it to a point where every department in the government comes to us for information.' So did security services in the Empire and Allied countries.
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