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By Root 2601 0

or appropriately do. From the mid-1930s, under the pressure of anticipated and actual war SIS had intermittently taken on a whole range of covert activities, not all of which were exclusively concerned with the gathering of foreign intelligence from foreign sources. Under similar pressures, and massively reinforced by William Stephenson’s restless business gifts and entrepreneurial flair, BSC developed with astounding speed into an impressively wide-ranging organisation, and one which provoked favourable comment from visiting officers. ‘How much I admire the wonderful set-up you have achieved in New York,’ wrote Admiral Godfrey. ‘As the prototype of what such an organisation should be, I consider it beyond praise.’ F. T. ‘Tommy’ Davies, a senior SOE man, who had begun in Laurence Grand’s Section D, was ‘much impressed’ by the ‘very harmonious relationship’ between BSC’s three sections of SIS, Security and SOE and claimed that an ‘immense advantage’ was gained ‘by a quick and complete inter-change of intelligence’.15 When Richard Gambier-Parry visited BSC in late 1941, he came away very struck by Stephenson’s ‘immense application, photographic memory and driving force’, and spoke highly of the overall efficiency of the operation, as well as the excellent relations both within its headquarters and between it and the numerous agencies with which it liaised.

But once the USA came into the war much of BSC’s security and intelligence work could legitimately be taken over by the FBI and other United States agencies. Indeed, an irony of the USA becoming an ally at all was that the State Department and United States service departments’ consequent determination to be the controlling influence in the western hemisphere, and to stop all foreign and clandestine activities in the USA, whether by friend or foe, actually threatened BSC’s existence. As Stephenson reported to Menzies in January 1942, the so-called McKellar Bill then before Congress would require the registration of all ‘foreign agents’ and the detailed disclosure of particulars concerning agents’ appointment, remuneration, business and activity. This, wrote Stephenson, ‘might render work of this office in U.S.A. impossible as it is obviously inadmissible that all our records and other material should be made public’. Menzies was less worried, however. He thought the bill did ‘not in fact appear to curtail the activities of S.I.S., since you obtain moneys from the Embassy which need not pass through any bank. Your agents are all secret men unknown to any person outside the organisation and it should be impossible for the Americans to check up on their activities.’ In any case, ‘your S.I.S. activities are not now very great, since all Fighting Force information obtained from American sources should be forwarded through the British Missions in Washington’, which had been formed ‘now that America is in the war’. Nevertheless, after some vigorous lobbying by Stephenson and others, the bill was amended so that agents of the Allied ‘United Nations’ would be exempt from registration and need only report in private to their own embassy.

By mid-1942 BSC had passed its zenith (although Stephenson stayed on until the organisation was wound up in 1945). In October 1942 Menzies responded to a request from Stephenson for additional staff with the unwelcome news that he was considering whether ‘your already large staff should not be reduced rather than increased’. By the New Year, after Air Commodore Payne (Deputy Director/Air) had been out to inspect the SIS stations in the Americas and had discussed the situation with Ellis, Menzies was taking a harder line. ‘I am disturbed by the size of the S.I.S. staff in your New York and Washington offices,’ he wired on 2 January 1943. He thought there was not ‘now any justification for increasing the staff at S.I.S. stations in Central and South America’ and bluntly instructed Stephenson ‘to effect a 25% reduction in the executive staffs, and a 25% reduction in the clerical personnel’ of the New York and Washington offices by 31 March. Stephenson