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Germany’s Venlo sting completely
compromised an already shaky British
Intelligence network in Western Europe.

By Wil Deac

The 70th day of World War II–November 9, 1939–dawned chilly and overcast above neutral Holland’s southeastern frontier with Germany. Later that day, in the early afternoon, a slim, 29-year-old German drove a short distance onto Dutch soil and pulled into the Café Backus parking lot. He and his male companion entered the crowded, three-story building, doffed their overcoats and ordered aperitifs. Perhaps 40 yards from the cafe was the German customs house, swastika flag flying, behind which waited another 13 Germans. In the other direction, toward the town of Venlo, the Dutch frontier post was active with guards and military construction.

The two men nervously eyed the outside traffic, mostly bicycles, and waited. Finally, at 3:20 p.m., a sleek, red Lincoln Zephyr drew up. Inside the car were four men, including Britain’s top spymasters in Holland.

This secret meeting between representatives of the opposing sides had its genesis in peace feelers being sent out by German opponents of Führer Adolf Hitler. The task of sorting out most of the peace overtures fell to British Intelligence, which had its primary European station in the Dutch capital of The Hague. The British Intelligence effort was a joint venture between two organizations. One was the British Secret Intelligence Service (MI-6), which performed its clandestine tasks under the cover of the embassy-based Passport Control Office (PCO). The second, created by MI-6’s Colonel Claude Dansey to complement the PCO’s rather transparent cover, was the deep-cover Z Organization. Chief of the PCO-based operation was Major Richard Henry Stevens, who had served as an intelligence officer in India. The Z Organization was headed by German-speaking Captain Sigismund Payne Best, a tall, monocled, spat-wearing intelligence veteran of World War I whose cover was a trading and consulting firm.

Before too long, the PCO was penetrated by the Nazis and Best was compromised. Worse still, when Britain declared war on Germany, London destroyed any remaining security by ordering the two Intelligence elements to work together.

Thus armed with considerable knowledge of their enemy’s secret activities in northwestern Europe, the Nazis found it relatively simple to insinuate themselves into meetings between anti-Hitler German emigrés and the British. In the fall of 1939, the young and ambitious ex-lawyer Walter Schellenberg, who was about to become chief of the counterintelligence bureau of the Reichssicherheitshaupamt (RSHA, or the Reich Central Security Office), proposed using these emigrés to initiate a sting operation against the Best-Stevens team. Its purpose was to gain information on Allied Intelligence operations in Germany and to uncover disloyal Germans. Schellenberg’s boss, Reinhard Heydrich, agreed to the proposal.

Schellenberg’s first step was to have a known British agent, who was then working with the Nazis, inform Best that he could arrange a meeting with a disaffected German general. As expected, Best brought Stevens into the act. The British spymasters then solicited the cooperation of Dutch Intelligence, GS III (General Staff Section III). The GS III commander, who was pro-British and well aware of the German threat to his country, assigned a young lieutenant, Dirk Klop, to work with the British. To safeguard Dutch neutrality, Klop, who had lived in Canada, was to be passed off as an English captain named Coppens.

The initial meeting between the British officers and the “dissident” Germans took place on October 21, 1939, hopping from two cafes to a house in the town of Arnhem in east-central Holland. Instead of a general, the emigré double agent brought a Captain von Seydlitz and a Lieutenant Grosch, both army officers, to meet with Best and Stevens. No sooner had their session begun than Dutch policemen surrounded the house. They had been alerted by the conspirators’ suspicious behavior in one of the cafes they had visited. Although Klop was easily able to get rid of the intruders, the incident ruined the meeting. The shaky Germans wanted to go home immediately. Little wonder, since Seydlitz and Grosch were really von Salisch and Christensen of the Sicherheitsdienst (SD), the Nazi Party’s security and intelligence service.

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