For more than 60 years, only seven people on Earth knew that the Soviets broke U.S. military and diplomatic ciphers. One of those people was former KGB Berlin bureau chief and master Soviet spy Sergei Kondrashev. Kondrashev and his peers searched desperately for American code clerks as they came and went from the U.S. Embassy in Moscow. The KGB knew next to nothing about American ciphers, the code room in the embassy, or even the personnel who worked there. That changed in the early days of the Cold War.
Tennent Bagley was a CIA agent working around Eastern Europe, including Berlin. In the early 1990's, after the fall of the Soviet Union, he was to be featured on a German television show to discuss Cold War intelligence with former KGB agents. In preparation for the show, he met Kondrashev, his direct KGB counterpart. Kondrashev told Bagley things that the CIA never knew, including the story of "Jack," a U.S. Army Sergeant who single-handedly sparked off the Korean War.
In 1949, the memory of World War II and the existential threat to Russia was still fresh in the mind of Soviet Premiere Joseph Stalin. Tensions with the U.S. were higher than at any time in recent memory. The Soviet Union needed a way to predict American behavior.
They thought they lucked out when Sgt. James "Mac" MacMillan, a U.S. Army code clerk in the U.S. embassy in Moscow, began dating a Soviet national, nicknamed "Valya." Kondrashev was the intelligence agent assigned to Mac. He persuaded Mac to give him any details of the code room and of anything else he knew. In exchange, the KGB offered to set him and Valya up with an apartment in Moscow and money to start their lives.
It was only a few weeks after their first meeting that Mac defected to the Soviet Union. Kondrashev soon learned Mac's knowledge of the American codes was limited and the Russians were no closer to breaking the codes.
The Russians watched the U.S. embassy intently. Based on the information provided by Mac, they knew what the code clerks looked like, but after Mac's defection, the Americans were on alert. The KGB's got lucky again when agents reported an Army clerk visiting a local apartment, staying long into the night, and then returning to the embassy a few nights a week.
They code named that clerk "Jack" and his Russian lover "Nadya." Nadya was single, attractive, and had her own apartment. She was an employee of the U.S. embassy. Jack was also single, but was short, overweight, and losing his hair. The Russians also discovered he had a history of alcoholism and was known to be greedy. Nadya saw Jack as an opportunity to live abroad at a higher standard of living.
The KGB discovered Nadya had been approached, as an asset but the intelligence agency had more than enough contacts inside the embassy and dropped her as a contact. At the same time, they instructed the young woman to foster the relationship.
She set up the meeting between Jack and Kondrashev, who would be his KGB handler. After a number of meetings designed to assess Jack's vulnerability, Jack began to offer useful information. Russian government code breakers also started attending the meetings. For the rest of Jack's tour in Moscow, he met with the KGB, for which he was paid more than $100,000 and told that Nadya would be allowed to leave the Soviet Union and join him in the West.
In addition to information about the code room, cipher machines, and code procedures, Jack also gave the KGB code schedules for when the deciphering procedures would be changed, broken and used cipher parts, and a print copy of the alphabet backward and forward (along with punctuation marks). The KGB was able to reconstruct the American code machine by the end of 1949. They were now able to read all American communications destined for installations worldwide.
Stalin's fear of a direct military confrontation with the United States guided much of the Soviet Union's foreign policy in the years following the Second World War. For years, Kim Il-Sung, the founder of the Communist regime in North Korea, urged Stalin for support (read: "permission") to invade South Korea and unify the peninsula under his rule. Stalin hesitated to give Kim the green light because he thought the Americans would rush to defend the South Korean regime.
Deciphered American military communiques convinced Stalin that the Americans would not be as willing to defend South Korea as previously thought. The secret messages revealed that the U.S. had moved combat assets to the Japanese mainland and would thus be ineffective in defense of the fledgling republic. Stalin gave Kim the go-ahead and North Korean tanks rolled across the border on June 25, 1950.
Nadya was not allowed to leave the Soviet Union due to the KGB's fears of American counterintelligence discovering Jack. Kondrashev's superiors in the KGB did not survive Stalin's purges. The codes Jack divulged to the USSR were used to read American diplomatic and military communications until 1961.
Jack returned to the U.S.; his identity was never discovered as Kondrashev went to great lengths to not disclose information to Bagley that might be used to compromise Jack.
(Author's note: Bagley documented these stories in his book, Spymaster: Startling Cold War Revelations of a Soviet KGB Chief.)