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in Somerset, there was a fresh alarm that his secret service work might be exposed. This time Valentine Vivian was despatched for damage limitation and successfully arranged with the Somerset Chief Constable to leave any reference to Passport Control out of the legal proceedings. Gray, who recovered from his self-inflicted wound, was sentenced to death at Winchester in July 1941, but was reprieved and subsequently jailed for life.24 He evidently had a difficult and troubled private life. There is no way of estimating the extent to which (if at all) the pressures of secret intelligence work may have exacerbated his personal problems, though one may reasonably suppose that the strains of having to maintain a secret professional existence may not have helped. What is clear from this case, however, is that domestic crises, of whatever sort, had an unsettling potential to go public and endanger operations. Thus the Service took these kinds of problems very seriously indeed.

Even though Sinclair and Pay Sykes (in charge of SIS finance) tried to keep close tabs on Service expenditure, the realities of funding intelligence work at station level, regularly requiring untraceable payments in cash or precious goods of various sorts, inevitably meant that officers and agents, the former of whom were not particularly well paid, could be faced with considerable temptations. Not everyone was able to resist. In the early 1920s one of the Riga station’s staff decamped with the Passport Control Officer’s seal, a month’s advance salary and £500 (equivalent to £20,000 today) in diamonds and gold, stolen from a dealer who had smuggled it out of the Soviet Union. During the following decade the sharp increase in the numbers of Jewish refugees seeking to travel to Palestine underpinned the development of a black market in the necessary British visas. During the 1930s there were three cases of visa-trafficking in the Warsaw Passport Control Office. The most serious, in July 1936, threatened to expose SIS’s role in the Passport Control organisation and the British ambassador wanted to prevent Major Shelley, the Passport Control Officer (and SIS head of station in Warsaw), and other diplomats from having to appear in court lest ‘they might be asked questions about the internal affairs of the Passport Control Office which it would be inexpedient for them to answer’.25

The worst financial scandal of the 1930s occurred in the Netherlands. Here Major Ernest Dalton, a First World War MI1(c) veteran, had been head of station since April 1924. But his time at The Hague was overshadowed by the revelation in the mid-1930s that he had got into financial difficulties and embezzled several thousand pounds’ worth of visa fees.26 Dalton’s wife was seriously ill and he himself suffered from ‘blood poisoning’. Efforts to recoup the money through gambling having failed, he collapsed under the strain and committed suicide in July 1936. ‘I have got myself into such a mess’, he wrote, ‘that this is the only way out.’ Sent out to deal with the situation, Rex Howard vetoed a suggestion by one of Dalton’s assistants that his death should be put down to ‘heart failure’. The ambassador sensibly argued that ‘it was better to be quite frank in the first instance, as otherwise it would be thought that there was something to hide’. Traces of the Dalton tragedy remained at the station. Officers subsequently posted to The Hague were solemnly taken to what had been his bedroom and shown the badly repaired mark in the wall caused by the bullet with which he had killed himself.

Further investigation and suspicions of connivance among the station staff in Dalton’s ‘defalcations’ led to some dismissals and the Dutch-speaking Monty Chidson (his wife was Dutch), urgently summoned from Bucharest, became head of station with instructions ‘to take such steps as he may think fit to ensure that all matters in the office are systematised & regularised as soon as possible’. That Chidson’s attitude to security was not all that might have been desired became evident to Howard at dinner one