Intelligence can do alot...and it can be very confusing...:
‘Stella Polaris’ and the Secret Code Battle in Postwar Europe by Matthew M. Aid
Much has already been written about the September 1944 evacuation of the Finnish intelligence service to Sweden, which was designated Operation ‘Stella Polaris’. Newly declassified intelligence documents found at the US National Archives provide a fresh perspective on the role of the American wartime foreign intelligence service, the Office of Strategic Services (OSS) and its successor, the Strategic Services Unit (SSU), in ‘Stella Polaris’ and its aftermath. The documents reveal that throughout World War II, the OSS secretly obtained sensitive intelligence information concerning America’s wartime ally, the Soviet Union, from agents within the Finnish intelligence service. The OSS Stockholm Station purchased Soviet and other foreign government code and cipher materials from the Finns, not realizing until later that the Finns had sold the same material to other states. The Americans responded by recruiting some well-placed agents within the Finnish ‘Stella Polaris’ organization, who provided detailed information about the intelligence activities of the Finns in Sweden, and the work of Finnish intelligence officers in France after the end of the war. Among the key pieces of intelligence obtained was the fact that the French intelligence service was intercepting American radio traffic.
http://www.frankcass.com/jnls/int_17-3.htm
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http://frode.home.cern.ch/frode/pubs/beckrevw.pdf
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http://cryptome.sabotage.org/venona-ru.htm
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IN 1939, WHEN THE SOVIET UNION was an ally of Nazi Germany, the U.S. Army began collecting copies of encrypted cables sent commercially to Moscow by the Soviet diplomatic missions in the United States. No effort to decrypt the cables, thought to be diplomatic in nature, was made until 1943, when reports were received that Stalin, by then an ally of the United States, was negotiating a separate peace treaty with Germany. At that time, the Army Signals Security Agency (SSA), an early predecessor of the National Security Agency (NSA), was ordered to establish a program—eventually called VENONA—to decipher the cables. The Soviet codes did not yield readily to cryptanalysis, because, as it was soon discovered, a two-part ciphering system had been employed; the second step used a one-time pad—theoretically unbreakable. As it happened, none of the messages was deciphered before the end of the war.
Once progress began to be made, however, the SSA cryptanalysts made a startling discovery. Only slightly more than half of the 750,000 intercepted cables concerned foreign ministry and trade matters; the balance involved Soviet intelligence organizations. By 1946, when the first message was decrypted, KGB, GRU (military intelligence), and naval GRU–user systems had been identified. When the VENONA program ended in October 1980, portions of nearly three thousand of the cables intercepted between 1939 and 1948 had been decrypted. The results revealed that Soviet agents had penetrated every important organization in the American government, including the Manhattan Project. The Allies were not immune; VENONA revealed Soviet penetrations in Britain, Canada, and Australia. In 1995 the VENONA decrypts were declassified. Hard copies were made available to scholars, while digital versions were posted on the NSA Website, together with several monographs providing historical details.
After the British joined the VENONA operation in the late 1940s, they began to decrypt and analyze cables sent over the London-Moscow and Moscow-Canberra circuits. (The results, with a mix of clear text and gaps, were released by NSA in 1996.) The task for the analyst was to use the clues provided by the clear text to determine the identity of the agent. While not always possible, West, after analyzing GRU traffic from London to Moscow, for the first time puts true names to Soviet agents identified previously only by their cryptonyms in VENONA. For example, Igor Montagu (cryptonym Nobility), brother of Ewen Montagu (author of The Man Who Never Was), was a life-long communist who spied for the GRU, though his family never suspected either. In another instance, West identifies “Intelligentsia,” an active GRU agent, as the well known British scientist J. B. S. Haldane, who was helped by his wife Charlotte. For reasons not made clear, West concludes that the still unidentified VENONA Agent 19 (thought by some to be Harry Hopkins) was Eduard Beneš.
Professor Desmond Ball and David Horner, a Senior Fellow, are with the Strategic and Defence Studies Centre at the Australian National University. Each has written extensively in the national security field. Their book, Breaking the Codes, was the first to be published after the release of the VENONA decrypts in 1995; it is primarily concerned with ten Australians who spied for Soviet intelligence. From 1943 to 1949 ten individuals delivered to their communist handlers classified documents from the Australian military, domestic security, and external affairs departments, as well as British and American strategic plans. By 1945 Australian security officials knew there were leaks in the system, but it was not until the Americans and British informed them of the VENONA decrypts from the Canberra-Moscow KGB link that the sources became known.
Several of the ten were first named publicly in 1954 by KGB colonel Vladimir Petrov and his code-clerk wife when they defected to Australia. However, in reality, as Ball and Horner reveal, some of the identities, although attributed to the Petrovs, actually came from VENONA.
One revelation, now of historical interest only, was that during World War II Australian agents gave Allied war plans in the Pacific to their Soviet masters, who then “allowed” the Japanese to acquire them. Whether the Australian agents knew about this is unclear, but the authors quote Australian Communist Party leaders as saying, “We want a Russian victory, not necessarily an Allied victory.”
For example, VENONA cables confirmed that Alger Hiss (Ales) of the State Department was a GRU agent and that Harry Dexter White, assistant secretary of the treasury, served the NKGB.* There is more on the spy ring run by Julius Rosenberg and his wife; he was an active NKGB agent, and she knew it. The VENONA decrypts also show that the American networks violated nearly every principle of clandestine operations—most of the American agents had received little or no training. A good example of this is the Golos-Bentley network, which functioned in Washington, D.C. The decrypts confirm that careless tradecraft was one reason why the NKGB took over the agents from the American communists who initially ran them. The takeover by the NKGB, VENONA makes clear, is the principal reason why Elizabeth Bentley defected to the FBI. Her testimony, criticized in the media as “the bizarre rantings of a neurotic old maid,” was later confirmed by VENONA, and it contributed greatly to the disintegration of the Soviet espionage networks in America.
Despite their sloppiness, it cannot be denied that the Soviets were amazingly successful. VENONA makes absolutely clear that they had active agents in the U.S. State Department, Treasury Department, Justice Department, Senate committee staffs, the military services, the Office of Strategic Services (OSS), the Manhattan Project, and the White House, as well as wartime agencies. No modern government was more thoroughly penetrated. The Soviets were even told about the VENONA project, but there was little they could do about it at that point. Another measure of the magnitude of Soviet penetration in the United States is provided in the appendices. One lists 349 Americans and U.S. residents identified by VENONA who spied for the Soviets; another lists 139 Soviet spies known from other sources.
For instance, the cables revealed that it was Cambridge spy Kim Philby who told the NKGB that Elizabeth Bentley had defected to the FBI. The new material confirms details concerning the atom spies, Harry Dexter White’s role, the Hiss case, and a number of others. The chapter on the OSS (long known to have been deeply penetrated) adds new names and corroborates agents identified in VENONA. No intelligence service had so many moles. Regarding the nonexecutive-branch agents, the authors also expose several previously unreported penetrations. The most spectacular example is the case of Congressman Samuel Dickstein, the man who introduced legislation that eventually produced the House Committee on Un-American Activities. Dickstein spied for the NKVD in the late 1930s; he was one of the few who served his Soviet masters strictly for money.
The Haunted Wood also adds new detail to the case of Hollywood film producer Boris Morros, a Soviet spy for years before being discovered, thanks to VENONA. Questioned by the FBI, Morros quickly realized his predicament, and to save his skin, he volunteered to become a double agent. He did a good job. In his 1959 book, My Ten Years as a Counterspy, Morros leads the reader to believe that it was he who sought out the FBI. Part of the same espionage ring was Martha Dodd. Her father was the American ambassador to Germany in the 1930s. She started her spying in Berlin and continued well into the 1950s. She and her American husband, who was also a Soviet agent, escaped to Eastern Europe, where they remained until their deaths.
http://www.nwc.navy.mil/press/Review...er/re2-Su0.htm
