The Sword and the Shield: The Mitrokhin Archive and the Secret History of the KGB

OUTSIDE EUROPE, THE NKVD’s most successful attacks on German targets were mounted by an illegal residency in Argentina,⁵² headed by Iosif Romualdovich Grigulevich (codenamed ARTUR), a veteran both of sabotage operations in the Spanish Civil War and of the first attempt to assassinate Trotsky in Mexico City.⁵³ In September 1941 an official Argentinian inquiry reached the hysterical conclusion, endorsed by the Chamber of Deputies but rejected by the government, that the German ambassador was the head of over half a million Nazi stormtroopers operating under cover in Latin America.⁵⁴ During the months after Pearl Harbor, Argentina and Chile were the only Latin American states not to break off diplomatic relations with Germany and Japan. The rumors of Nazi plots among Argentina’s quarter of a million German speakers, pro-German sympathies in its officer corps, and the presence of an Argentinian military purchasing mission in Berlin until 1944, helped to persuade the Centre that Argentina was a major Nazi base. Though this belief was greatly exaggerated, it was shared by OSS, the US wartime foreign intelligence agency, which reported that Dr. Ramón Castillo, president of Argentina from 1941 to 1943, was in the pay of Hitler.⁵⁵ Such reports, passed on to the Centre by its agents in OSS and the State Department,⁵⁶ doubtless reinforced Moscow’s suspicions of Nazi plots in Argentina.

After the outbreak of war the German merchant navy was unable to run the gauntlet of the Royal Navy and enter Argentinian ports. Grigulevich’s residency, however, reported in 1941 that copper, saltpetre, cotton and other strategic raw materials were being exported from Argentina in neutral vessels to Spain, whence they were being secretly transported overland through France to Germany. To disrupt this export trade, Grigulevich recruited a sabotage team of eight Communist dockyard workers and seamen, headed by a Polish immigrant, Feliks Klementyevich Verzhbitsky (codenamed BESSER), who in December 1941 obtained a job as a blacksmith in the port of Buenos Aires. The first major exploit of Verzhbitsky’s group was to burn down the German bookshop in Buenos Aires, which Grigulevich regarded as the main center of Nazi propaganda. Thereafter it concentrated on planting delayed-action incendiary devices on ships and in warehouses containing goods bound for Germany.⁵⁷ Grigulevich also ran smaller sabotage and intelligence networks in Chile and Uruguay. The approximately seventy agents in his far-flung illegal residency were to remain the basis of Soviet intelligence operations in Argentina, Uruguay and—to a lesser extent—Chile during the early years of the Cold War as well as the Second World War.⁵⁸

Between the beginning of 1942 and the summer of 1944, according to statistics in KGB files, over 150 successful incendiary attacks were mounted by Grigulevich’s agents against German cargoes, and an unspecified number of Spanish, Portuguese and Swedish vessels sunk. One, probably exaggerated, assessment by the Centre claims that the attacks succeeded early in 1944 in halting German exports from Buenos Aires.⁵⁹ A more serious problem for Germany than Soviet sabotage, however, was the change of government in Argentina. A military coup in the summer of 1943, followed by the uncovering of a Nazi espionage network, led Argentina to sever diplomatic relations with Germany in January 1944.⁶⁰

For most of the war communications between Grigulevich’s residency and the Centre were slow and spasmodic, depending on occasional couriers between Buenos Aires and the New York residency.⁶¹ In the summer of 1944, shortly after the NKGB had established a legal residency in Uruguay, Grigulevich was summoned to Montevideo to give a detailed report on his intelligence operations, finances and agent networks since the beginning of the Great Patriotic War. The Centre had become alarmed at the scale of his incendiary attacks on neutral shipping and feared that his cover might be blown. In September it ordered him to suspend sabotage operations and limit himself to intelligence collection in Argentina, Brazil and Chile.⁶² Once instructed to stop work by Grigulevich, Verzhbitsky began making grenades for the underground Argentinian Communist Party but was seriously injured in October by an explosion in his workshop which cost him his left arm and the sight in one eye. Grigulevich reported that he behaved with great bravery during police investigation, sticking to a prepared cover story that a personal enemy had planted explosives on him, hidden in a packet of dried milk. In 1945 Verzhbitsky was smuggled out of prison and exfiltrated by the Argentinian Communist Party across the border into Uruguay, where he lived on a Party pension.⁶³