Every agent has a blind spot, as Desmond Morton was about to be reminded. Max had assured his boss that in his new job for MI6 he would avoid Special Branch ‘like the plague’. By using Max, Morton was not only trespassing on his rival organisation’s territory but also flouting the government’s ban on undercover operations against the Communist Party. But if Morton’s agent was trying to avoid Special Branch ‘like the plague’, he had a very unusual way of going about it.
Soon after being taken on by MI6, Maxwell Knight began to have regular lunches with an old friend. This was Lieutenant-Colonel John Carter, a man who was by that stage of his career Deputy Assistant Commissioner of the Metropolitan Police, and as such the nominal head of Special Branch. On 23 July, 1930, Max went to have another lunch with Colonel Carter of Special Branch. They met at their usual spot: Hatchett’s, on Piccadilly. Max settled down for what he presumed was going to be another convivial meal.
It was not.
‘Was Major Morton going to close down the whole of this business,’ demanded Carter, ‘or was he not?’1
The man from Special Branch had found out about Max’s network. He was apoplectic with rage, and understandably so. It seems that during one of Max and Carter’s earlier meals the young MI6 agent had made a remark that piqued Carter’s curiosity. It is unlikely that Max told the Special Branch man outright that he was working for Morton. More likely he was unable to resist the temptation to hint that he was up to something, that his exile on Exmoor was over and that he was back in the intelligence game.
Carter’s response was to send a detective down to Exmoor to investigate. Other Special Branch detectives began to shadow Max around London. Although Max later claimed to have been aware of this, assuring Morton that he was more than capable of shaking off a Special Branch tail, it is hard to think why he would have allowed these detectives to see him meeting Morton. Most likely this observation happened at St James’s Park Tube station, just a stone’s throw from MI6 Headquarters.
By modern standards the idea of an MI6 agent meeting his spymaster here, of all places, sounds hopelessly amateur. But this level of tradecraft was not unusual at that time. There are many elements of MI5 and MI6 intelligence-gathering between the wars that come across as shockingly unprofessional when compared to what goes on today. Much of this was down to a lack of training, limited resources and tiny salaries. Men like Max and Morton were drawn to their profession out of a boyish love of intelligence and often found themselves making it up as they went along. But this does not fully explain Max’s decision to have a series of lunches with the head of Special Branch. Like a poacher who asks to meet the gamekeeper from whom he is stealing, this may have been about brinkmanship as well, and the bravado of being in on a secret which the other person is not.
All that had now come to an end. A spluttering Colonel Carter told Max that Desmond Morton was ‘a worm’, and that before he was finished he wanted to see the MI6 man ‘go on his knees to him on the carpet at Scotland Yard’.2
‘I can make things bloody unpleasant for you,’ Carter told Max. ‘How would it be if I gave the whole thing away to the Communist Party?’
By ‘the whole thing’ he meant Max’s agent network. Only months after it had been revived, Carter was threatening to snuff out Max’s espionage career.
‘This is going to be a fight,’ Carter went on.3 ‘I am going to fight until the last ditch.’ The head of Special Branch then delivered his ultimatum. If Max continued to work for MI6, Carter would ‘make his life and that of his agents a misery’.4
‘We have a government in power now whose policy is against this sort of work,’ said Carter.5 ‘I have to carry out their policy.’ His anger had as much to do with Morton trespassing on Special Branch territory as the MI6 man’s disregard for the Prime Minister’s instructions. Carter was right. He and Morton were Crown servants with a constitutional duty to carry out the wishes of the elected government. Yet Max did not see it like this. He interpreted Carter’s anger as evidence of a left-wing bias.
By this stage of his career Max had only ever worked for men who saw Communism as an existential threat to both the country they loved and to their own class. He did not see it as a legitimate political concern within a tolerant, liberal democracy. Whether it was through force of habit or his own political conviction, the idea of soft-pedalling against the Communists, or being impartial, was anathema to him.
Desmond Morton did not go on his knees to Colonel Carter. That was not in his nature. Instead, the row between MI6 and Special Branch was allowed to grow until it became, in the words of the historian Gill Bennett, ‘outright warfare’.6 MI5 was dragged into the fray and at one point even received information about Max from John Baker White, the man who had talent-spotted him all those years ago. Relations between MI6 and Special Branch reached an all-time low, until it was decided, in an attempt to resolve the situation, to convene the all-powerful Secret Service Committee.
In January 1931, the head of MI6 was summoned before this august committee. He was asked to explain why his organisation had agreed to take on Max. One of the charges against C’s ‘intermediary’, that is, Max, was that this young MI6 agent had used a British civil servant as one of his informants. Another accusation was that Max had been, and might still be, a senior figure within the British Fascists.
This was why Desmond Morton had covered up his agent’s past. There was nothing exceptional about Max’s anti-Communist views, and they were consistent with those held by most MI6 officers. Yet his involvement with the British Fascists was different. Although he could say that he had joined this organisation under instructions from Sir George Makgill, there was, of course, the possibility that deep down he had come to sympathise with this group’s core beliefs. Over the last few years the popular perception of Fascism had changed. In Germany, Hitler’s Fascist party now represented the second largest political grouping and might soon form a government. Mussolini was moving towards a new conception of Fascism as a ‘universal phenomenon’, one that might match international Communism in its reach and power.7 European Fascism was a far more dangerous prospect than it had been five years earlier, and now had the potential to threaten British interests.
Maxwell Knight was a spymaster of obvious ability, he was trustworthy, industrious and showed rare skill as an agent-runner, but he was handicapped both by his Fascist past as well as his occasional desire to show off, which was what had got him into this mess in the first place. The whole debacle might have been avoided, or at least postponed, had Max been able to resist the temptation to see Carter for lunch and drop hints about his work for MI6.
The Permanent Secretary at the Home Office, Sir John Anderson, was Chairman of the Secret Service Committee. He told C that the idea of MI6 employing a senior Fascist, such as Max, was intolerable. The possibility that this man had also recruited as an agent a British civil servant was one that he ‘could not possibly countenance’.8 Anderson stressed ‘the danger of a Government organisation such as MI6 being in any way associated with such undertakings’, before adding that the situation was ‘a source of grave embarrassment’.9
C could have hung Max out to dry. Instead, as MI6 employees generally do when one of their own is under attack, he went on the offensive. He assured the committee that Max’s network contained just four agents. As for his man being a Fascist, C claimed to have documentary proof to show that Max had severed his link with the BF. He also dismissed the idea that Max had been using a British civil servant as an agent.
Almost all these claims were untrue. Whether or not Anderson believed C, he concluded that the best solution was wholesale structural reform, an opinion shared by his colleagues on the committee, Sir Warren Fisher and Sir Maurice Hankey, two of the most powerful British civil servants of the interwar years. After three further meetings, the Secret Service Committee reached a radical decision.
The ‘Treaty of Westminster’, as it became known, fundamentally changed the relationship among Special Branch, MI5 and MI6, and the scope of their respective powers. Desmond Morton lost the services of Max and his network of agents, as well as the Special Branch section SS1 (which had become MI6’s de facto domestic wing). Morton and his MI6 colleagues were also forbidden from running agents within three miles of British territory. MI5 came out of it all rather differently.
The committee ruled that in future Sir Vernon Kell’s department would deal with all Communist subversion in Britain, whether civilian or military. It would be detached from the War Office and renamed the Security Service (a title that took many years to catch on in Whitehall). It was also given the services of SS1 and the man at the eye of this particular storm: Maxwell Knight.
Max’s ill-advised lunches with Colonel Carter had been the catalyst to one of the greatest shake-ups in the history of British intelligence. It was also the turning point of his career. For months this MI6 agent had been living under a Damoclean sword as he waited to discover the fate of his network and, ultimately, his espionage career. He had been staring at a defeat that was rooted in his inability to make himself invisible and the extent of his Fascist past. Now he was on the verge of a new life as an MI5 officer. He would be offered his own desk, his own staff, more funding than ever before and his own MI5 section with which to carry out the task he saw as his calling in life: defending the realm from Communism. Although he would no longer be working for Desmond Morton, he would stay in close contact with his former spymaster, and this relationship would one day prove to be vital.
Yet there may have been more to Max’s sudden change of fortune. Towards the end of his life, Max’s most treasured possession was a gold cigarette case. It bore the royal cipher of King George V and the following inscription: ‘Maxwell Knight, 1931’.
The King was not in the habit of handing out gifts like this for trivial or unremarkable acts. The few people that Max entrusted with the story of why he had been given this cigarette case died without divulging the details, saying only that it was the greatest secret of his career. At the very least, we know that in 1931 he performed some act or service for which the Royal Family, and in particular the King, was extremely grateful. Precisely what he did and for whom may never come to light. It is possible that it involved a case of blackmail and one of the King’s sons, but that is speculation. What is absolutely clear is that the task he carried out for the King coincided with the start of his new life as an MI5 officer.
Before taking up his post in MI5, Max considered the question of what to call himself and his new section. He knew that the head of MI6 signed himself off as ‘C’, the head of MI5 sometimes went by ‘K’ and Somerset Maugham’s agent, Ashenden, reported to ‘R’. Max decided that his MI5 section should be known as ‘M Section’ and that he would be called ‘M’. Some took this to be nothing more than an abbreviation of his first name, but there was more to it than that, as we shall see.
Incidentally, M was the moniker that had been used long ago by William Melville, a founding father of MI5. As a newcomer to Britain’s counterespionage agency, Max could have been accused of claiming a slice of its history for himself. His decision to reinvent himself as M was bold and full of chutzpah. It was a sign of the confidence he had in his ability as a spymaster and the new approach he was hoping to adopt. For, by the time Maxwell Knight joined MI5, he had a plan for how to find out what was really going on inside the Communist Party and how to reach the fabled ‘centre of affairs’. To do this he would use a very different kind of undercover agent.