THE FOURTH MAN PART 1

True Spies, Episode 129 - The Fourth Man, Part 1

++++DISCLAIMER: The investigations detailed in these episodes of True Spies are still ongoing, and no formal accusations have been levied. SPYSCAPE does not endorse any one conclusion to the so-called Fourth Man Case.

NARRATOR: Welcome to True Spies. Week by week, mission by mission, you’ll hear the true stories behind the world’s greatest espionage operations. You’ll meet the people who navigate this secret world. What do they know? What are their skills? And what would you do in their position? I’m Vanessa Kirby, and this is True Spies, The Fourth Man.

BOB BAER: They had multiple operations that were compromised that [Aldrich] Ames unlikely had any access to. And as it turned out, [Robert] Hanssen didn't have access to them. So as the FBI told me, it's just a matter of mathematics.

NARRATOR: Part One: The Big Case. The principle of need-to-know is a pillar of life at the CIA. Avoid sharing information with anyone other than the people who need to know it and you can potentially avert disaster down the line. That’s precisely how a team of three women at the CIA carried out a major mole hunt right under the nose of their clueless boss.

BOB BAER: I certainly didn't ask, “Why are you coming in on weekends? And why are you working on an air gap computer which you lock up? And I don't have the combination of your safe even though I'm your boss." I just let it go.

NARRATOR: This was the mid-90s, and moles were a hot topic at the CIA. The most famous KGB infiltrator of all time had recently been arrested and convicted of espionage. His name was Aldrich Ames. These investigators wanted to know how many losses could be blamed on Ames and other known moles and how many were still unexplained. The three women were peeling back the layers of secrecy and mystery to identify the known unknowns.

BOB BAER: Ames' traveled to Bogota when he met the KGB. What case went bad after that? What cases went bad in, let's say, Bulgaria, when Ames is assigned to Rome? And so they can make a list of… All right, that's definitely Ames. That's definitely Ames. That's definitely Ames.

NARRATOR: And the more they worked, the clearer it became that something had gone horribly awry.

BOB BAER: They said, “Wait, they're just too many anomalies here and there's too much of it for luck. We believe there's a fourth man.”

NARRATOR: Let’s begin with a disclaimer. There’s no end to this story. No definitive answer to the question at its core. No tidy resolutions. This is a tale that has been unfolding, quietly, for the past three decades, concerning people who once held some of the highest positions in American intelligence. It’s a story we’re telling in two parts. In Part Two, you’ll learn about the modern-day investigation being carried out right now. You’ll also learn how one man, a former intelligence officer himself, is bypassing the bureaucratic red tape to get his own answers. To the ire of just about everyone involved…

BOB BAER: I mean, right now I'm persona non grata.

NARRATOR: But in this episode, Part One, we have to return to the start, 30 years ago. To an even more complex environment - if you can believe it - for people whose duty it is to root out the truth. To the early 1990s, shortly after the fall of the Soviet Union. Not one, not two, but three moles had infiltrated the Agency. And now, a team of counterintelligence officers was investigating yet one more. It goes without saying: Morale was down in the CIA. And the last thing the Agency needed was more bad press. If the investigators unearthed yet another KGB mole they would hardly be celebrated for their success.

BOB BAER: Have you ever seen The Wire? He tells the judge about some big cases in the Baltimore Police Department. And the judge then immediately demands an investigation and the guy's in a lot of trouble. It's the same way with the CIA. 

NARRATOR: By now, you might be getting the sense that the voice you’re hearing is not the Agency’s number-one fan. 

BOB BAER: My name is Bob Baer. I spent 21 years in the CIA, almost all overseas.

NARRATOR: Robert Baer is what you might call a CIA heavyweight. A big shot. He’s a winner of the Agency’s prestigious career intelligence medal. A sought-after columnist and commentator across countless glossy magazines and high-profile news outlets. He’s someone people turn to in order to make sense of American intelligence. And yet, he’s long viewed the agency with some remove.

BOB BAER: I personally always expected to be invited to leave the CIA at any time. When I jumped out of an airplane with Russian Spetsnaz, that was looked down upon. When I drove a tank, that was looked down upon. When I went to Beirut in the middle of the Civil War and it was just completely crazy, and that was looked down upon. That was not a career-enhancing thing for anybody. And I resigned from the CIA, didn't retire, in December ‘97 and went out and started writing books and doing movies.

NARRATOR: You might already know a thing or two about Bob if you’ve seen the film Syriana starring a little-known actor by the name of George Clooney.

BOB BAER: He more or less plays me - sort of a bedraggled spy who meets a bad end. I haven't met a bad end yet, but you never know.

NARRATOR: Clooney spent a lot of time with Bob - really studied his subject.

BOB BAER: Put on weight, disillusioned by the whole system, by the lies and big oil and the rest of it. So he got the mood and he got an Academy Award for looking bedraggled.

NARRATOR: Bedraggled Bob, having spent many years feeling frustrated with the CIA, was by then working full-time as an author.

BOB BAER: I wrote a book about Iran and Saudi Arabia, and then I woke up one day and I said, “I am not going to write about espionage.” Whatever I knew about it - or know about it - I'm done. And that's when my former boss, who ran Russian operations, said there was another spy.

NARRATOR: Another spy. It wasn’t your average CIA operations officer Bob’s ex-boss was talking about. No, this was a different kind of spy and a different kind of story from the ones Bob was used to telling. But it was a story that American intelligence officials were becoming increasingly, uneasily, familiar with.

BOB BAER: In American intelligence, there were three great betrayals of Russian operations between the FBI and the CIA. The first betrayal was Ed Lee Howard, who ended up defecting to Moscow, where he died of a broken neck. He betrayed all sorts of things to the Russians. It wasn't quite certain what. And then there was Rick Ames who worked in counterintelligence, and he betrayed everything he knew to the Russians in 1985. He was arrested in 1994. And then there was Hanssen, Bob Hanssen, who was arrested in 2001. He was an FBI agent who told the Russians everything he knew.

NARRATOR: Three men, three massive betrayals of American secrets. You can learn about one of them, Robert Hanssen, in Episode Two of True Spies. The Agency had incurred significant damage as a result of all three, and Russian assets working for the United States had lost their lives. And then, in 1994, American intelligence officials began to ask seriously: Was there a fourth?

NARRATOR: For Bob, this story first began back in 1996, shortly before he resigned from the CIA, on a trip from the White House back to Agency headquarters.

BOB BAER: My boss, Bill Lofgren, we were getting out of the car and he said there was another one. He pointed it up at the seventh floor and he said, “He's up there.”

NARRATOR: The seventh floor of the headquarters building was where the bigwigs worked. It was the seat of power for American intelligence officials. If the mole had really infiltrated such a senior level at the Agency, he would no doubt have access to some of the country’s most consequential secrets. But the losses brought about by Ames and Hanssen had occasioned an atmosphere of extreme suspicion in the CIA. Bob knew that if he went poking around to find out more, he’d likely come up against trouble.

BOB BAER: And there's so much paranoia in the CIA, I didn't dare ask him, like, “What do you mean there's another one?” And, I sort of looked up at the seventh floor dumbly and didn't ask any questions.

NARRATOR: Even if Bob had asked those questions, Bill Lofgren wouldn’t have been able to answer. He retired shortly thereafter, certain that there were intelligence losses that couldn’t be accounted for. 

BOB BAER: I just put it out of my mind. He gave me no details. He didn't say who it could be. It was a passing comment. I wrote about it in my first book, like all the things I didn't know about the CIA, even though I was on the inside. It's really quite hard to tell what's going on. You just drop these things and maybe you get answers and maybe you don't.

NARRATOR: Lofgren himself couldn’t, or didn’t, say who he believed was to blame until more than two decades later. 

BOB BAER: When we're out to lunch and he drops a name on me.

NARRATOR: Whose name? Well…we’re not going to spoil the ending just yet. And remember, it’s just one possible ending. No one has been arrested. No one has been charged. Lofgren had his theory, and by the end of these two episodes, you might have yours. After he dropped his bombshell, Lofgren tasked Bob with digging for answers.

BOB BAER: Clearly, by 2017 this is really bugging Lofgren. He's long retired. We're talking, like, 11 years. And so I said, “Bill, what do I do with this?” And he says, “Well, go back to the investigators and get their viewpoint on it.”

NARRATOR: That’s precisely what Bob did. In the late 80s or early 90s, a KGB operative working for the Americans started dropping hints that there were double agents in the mix. His code name was Max.

BOB BAER: He first approaches the CIA in an African station. At some point, this guy Max says, “You guys got a problem in the CIA. We're running a source there.” ‘We’ [being] the KGB counterintelligence. Well, the boss there said, “No, this is a typical KGB disinformation program where we're going to drive the CIA crazy.” Max is not provided any details. These throwaways, the code names are worthless. And Max was flighty.

NARRATOR: For a while, they believed he was what’s called a ‘dangle’ - someone tasked by the Russians with confusing and inciting chaos within the American intelligence services. But by 1992, the CIA had started to think maybe Max was onto something. Maybe there was a double agent in the Agency, compromising its intelligence. 

BOB BAER: So the CIA arranges what's called the ‘liaison visit’ to Washington, and then they take them to this fancy hotel in Greenbrier, West Virginia. And, one morning, Max's CIA buddy and he go fishing. Someone told me it was on a boat. Someone told me it was fly fishing. And Max said, “Hey, our source, the KGB's source, is going to Caracas to meet a case officer named Karatekin, a KGB officer.”

NARRATOR: Max didn’t know the name of the source, but that didn’t matter. With the help of the FBI, the travel plans of the double agent were corroborated and an arrest was made. That’s how the notorious KGB mole Aldrich Ames was caught.

BOB BAER: Based on that lead, the FBI was able to break into Ames’ house and get solid evidence that Ames was a Russian spy. It was a matter of wiring his house, following the money. And so in February ‘94, they're able to arrest him. So Max is, of course, a hero in this whole thing. And he's the fount of truth.

NARRATOR: The revelation that Ames had met the KGB in Caracas was a game-changer. But that wasn’t the only revelation Max provided his handlers. According to Max, there was also a mole in the FBI and a second double agent in the CIA, someone who was still at work in Langley and who had been recruited in Kuala Lumpur. That particular spy had even more power in the Agency than Ames had had, giving him access to even more secrets. In short order, the CIA was able to pin a name to Max’s second tip: Harold ‘Jim’ Nicholson. Today, Nicholson holds the odious title of the highest-ranking CIA officer ever to be convicted of espionage. You can learn about his story in True Spies: The Spy’s Son.

BOB BAER: So now what we have is that Max has led to the arrest of two CIA spies. He's still talking about the asset inside the FBI. But of interest to the CIA, he said, “The KGB has another spy inside the CIA, and he's at the very top.” 

NARRATOR: How could mole after mole slip through the cracks of the highest echelons of American intelligence? 

BOB BAER: We were firmly convinced by ‘91 or ‘92, Russia was falling apart completely. You had the war in Abkhazia, then you had the war in Chechnya, and you had corruption in Moscow. And the KGB, when I would go through, had disappeared.

NARRATOR: The KGB had been the CIA’s primary focus for decades. But when the Soviet Union fell, the Americans turned their attention elsewhere. According to Bob, Milt Bearden, head of the CIA’s Central Eurasia Division, scaled back the number of Russian agents working for the CIA in Moscow. They weren’t needed as much anymore. 

BOB BAER: And this wasn't just Milt Bearden. It went right to the top director of operations. It went to the White House: “We can get all the information we need about Russia by simply asking the Russians. You have a contact in the Kremlin. You call them up and say, ‘What's happening in Abkhazia?’ And that's enough.”

NARRATOR: That wasn’t quite true. For one thing, the KGB had not disappeared.

BOB BAER: The KGB just went underground. It was the KGB nomenklatura that simply went underground, shut up, and prepared for their takeover in ‘99 when [Vladimir] Putin came to power. But we couldn't see this because Ames gave up all our sources. Hanssen gave up the rest, and then the one that Howard gave up. So, by 1998 we were blind on Russia.

NARRATOR: Bearden’s deputy knew a thing or two about the nefarious power of the KGB. He had been key to catching Aldrich Ames.

BOB BAER: He simply looked at the facts: Money, travel, time, Max's lead about Caracas, and said, “Voila, there's our spy.” He was the wind in the sails of catching Rick Ames.

NARRATOR: In 1994, the CIA opened another investigation - something called a “post-Ames cleanup operation”. If there were indeed losses that couldn’t be accounted for, the Agency needed to know who was to blame. But within the CIA, it wasn’t exactly in vogue to suggest that there was another mole in the mix. After all, that Ames business had been embarrassing for the Agency to say the least. But it also wasn’t clear that all the losses of the mid-1980s could be attributed to the double agents who had already been caught. And remember those warnings from Max, the KGB agent.

BOB BAER: Max gives up bits and pieces and the people that knew about him said he's very unreliable. You know, sometimes he's right. Sometimes he's wrong. And you don't really know.

NARRATOR: Not somebody you’d stake your life on. But somebody who had a proven record of success. Remember, Max had known that Ames had met the KGB in Caracas. That was revelatory information. And he’d known about the other moles in American intelligence, too. To ignore his warnings about yet another would be to do the Agency a disservice.

BOB BAER: So with Max's track record, there we go. The investigation for the Fourth Man starts.

NARRATOR: The Agency set to work getting the Fourth Man investigation underway. A seasoned counterintelligence officer, Laine Bannerman, was appointed to lead the effort.

BOB BAER: She'd always worked in counterintelligence in Russian stuff. That was her thing. She knew the names of all the agents. She knew who had been compromised. She knew Ames. She knew all these people.

NARRATOR: Bannerman was a pedigreed CIA officer: her father was one of the Agency’s founders. Curiously, she’d also shared some personal history with Aldrich Ames. The two had gone to high school together where they had both been involved in theater. She had begun to study Russian in college and the country became her area of focus. Not only was she knowledgeable and well-connected, she was also deeply committed to her work.

BOB BAER: She was married to the job, by the way, no doubt about it. And she also never talked. And that was known in the CIA. She never commented on Russian cases, even old ones. She never talked out of school. And I noticed that when she was working for me, the other people working on this, they wouldn't even meet in the office because it could possibly be taped. The CIA wire is very weird, I know. They would go outside and talk in the parking lot, whatever they had to talk about.

NARRATOR: Bannerman in turn knew exactly who she wanted to work with: counterintelligence officers Diana Worthen and Maryann Hough. Both were, like Bannerman, steeped in the world of Russian counterintelligence. A fourth person was later added to the team, an FBI analyst by the name of Jim Milburn. Together, the investigators became known as the Special Investigations Unit, or the SIU - albeit, known to very few. They called their investigation The Big Case. The SIU was a continuation of an existing counterintelligence project, the one that had caught Aldrich Ames. 

BOB BAER: So Lane Bannerman heads the second iteration of SIU that takes over.

NARRATOR: But the SIU operated on a need-to-know basis - even the head of the Counterintelligence Center, which ostensibly oversaw the SIU, was in the dark about what Bannerman and her colleagues were up to.

BOB BAER: The people in Russian operations didn't know about the counterintelligence investigation. And in counterintelligence, they didn't know because remember, none of this stuff goes on the computer. It's written on 3 x 5 cards, paper, and on an easel.

NARRATOR: The work was so secretive that it couldn’t even be recorded on the CIA’s computer network. 

BOB BAER: If you've got a lead or a date or travel like that, you just write it on an index card. You don't put it on a computer in a database. There are no databases involved in it. It's too secret.

NARRATOR: Bear in mind, Bannerman and her team were investigating their own colleagues. And Bob says the environment they were working in, in the mid-90s, was one of deep suspicion and paranoia.

BOB BAER: In those days after the Ames arrest - '94, '95, '96 - anything to do with Russia you didn't ask because you would make yourself a suspect. If I went around saying, "Hey, is there a new spy? Is there a Fourth Man?" Immediately you would find yourself on that suspect list and shunted aside. When you get shunted aside at the CIA, you're done. 

NARRATOR: It’s a good thing all of them were so committed to their jobs. Not only because the atmosphere was so tense but because even if they achieved their goal, even if they accounted for the losses and rooted out the mole, they’d hardly be considered heroes within the organization. All four members of SIU knew that a finding like that could incense their colleagues at best. 

BOB BAER: They're going to piss them off and they're going to put a knife in your back. 

NARRATOR: So under strict secrecy and with zero fanfare, the SIU began to peel back the layers of everything that was known about Russian operations in the mid-1980s.

BOB BAER: In particular, they saw three compromises that occurred in May '85, which was a month before Ames spilled his guts to the Russians and brought all the files out of headquarters and gave them to his Russian handlers.

NARRATOR: Already, the SIU could see some discrepancies.

BOB BAER: As the FBI told me when we sat Ames down, he had a frank and full confession. He was very proud of being a spy. And in all the damage he did, he simply denied that he'd given these cases up in May. He said, "I didn't give them up until June." So you had these three cases at the center of this that they just concluded they weren't given up by Ames. And there were even cases before that that were given up before Ames approached the Russians.

NARRATOR: Some of their findings were simply a matter of process of elimination.

BOB BAER: They had multiple operations that were compromised that Ames unlikely had any access to. And as it turned out, Hanssen didn't have access to them. So as the FBI told me, it's just a matter of mathematics.

NARRATOR: SIU had to review everything that was known about the moles - the information they had access to and their travel plans many years after the fact. And above all, they had to keep their personal feelings in check. 

BOB BAER: They narrowed down a set of people based not on intuition. They said, “You can't do this on intuition. You want to avoid intuition. You simply want to take a deep chronology.” When did the compromises occur? Who had access? And you look at people's jobs. And they didn't even look at money. They didn't even look at travel or any of that. They just looked at who had access to it, the compromises, and then figured out who the spy was. 

NARRATOR: SIU placed all of the anomalies, the things that just couldn’t be explained, onto what spycatchers call a Matrix. That allowed the team to build out the story chronologically and to make sure the pieces of information they were gathering fit logically together or to take note when the pieces simply weren’t matching up.

BOB BAER: A lot of it has to do with telephone taps. It has to do with technical operations in South America that could not be ascribed to Ames or  Hanssen because he didn't know anything about them. The Russians will, for instance, find a microphone in a wall. They know exactly where to look for it because we're listening on the microphone. Now, how did they know that microphone was in that corner of that room unless they had a source at the CIA? 

NARRATOR: Slowly, the pieces fell into place. SIU was able to build out a profile for their mole based on the evidence they had gathered. A profile that fit the description Max, the KGB mole, had offered up.

BOB BAER: Certain things were compromised to the KGB from the Soviet desk. He had to have sat on the Soviet desk or been a supervisor in the division, and then he had to have spent some time in counterintelligence because there were some counterintelligence investigations, and I don't know what they are, that were compromised to the Russians.

NARRATOR: And then…there was this.

BOB BAER: He had to be assigned to Washington from '84 to '94 until their investigation.

NARRATOR: The mole was very likely still in the building while he or she was being investigated by the SIU. Now, this is where things get really dicey. And for Bob’s sake, here’s a little reminder: this story is based on his reporting 20 years after the initial investigation into the Fourth Man, and the information comes from his sources. There’s still a lot of information he doesn’t know and doesn’t have access to. No one has been charged with espionage, much less proven guilty. But to Bob’s knowledge, at this point, Bannerman and her team winnowed their suspects down to a fairly cozy list.

BOB BAER: Bearden would even go around and say, “I should be on the list because I know about Russian operations.” And then Lofgren said, “Well, I knew about two of these cases, one in Athens and one in Denmark. I should be on the list.” And even Laine Bannerman and Diane will say, “I should be on the list.” So you get in about a dozen to 20 people that end up on this list.

NARRATOR: A dozen or so people who all know each other, work together, and by and large have to interact with one another on a regular basis - all of whom have broken their backs to secure their current positions, high up on the CIA totem pole. Talk about tricky office politics. Imagine being an SIU investigator forced to look at your coworkers through such a critical lens. Imagine narrowing down your list of suspects and having to interact with people you once trusted, now knowing that they might very well have betrayed their country. It all makes for a tough job to have to clock into - and a tricky one to clock out of - at the end of the day. 

BOB BAER: It's one thing finding out you have a mole but it's much worse finding out who it is.

NARRATOR: So, who was on the list? Well, Bannerman herself, to start. Admittedly, she fit the profile. So did Diana Worthen, who was also part of the SIU. Ted Price, who’d ordered the investigation, made the cut. 

At the top of the list? Milt Bearden, the former Russia division chief who had scaled back Russian operations in the immediate aftermath of the fall of the Soviet Union. In November 1994, Laine Bannerman held a briefing, behind a vaulted door locked to outsiders. There were two easels on display laying out the matrix.

BOB BAER: Laine stands up and walks through the evidence and the evidence says it's somebody who's been at headquarters. It's somebody who was head of USSR operations. It's somebody in counterintelligence.

NARRATOR: By then it was clear: only one man still fit the profile. 

BOB BAER: And a guy jumps up, kicks his chair back, and storms out of the meeting.

NARRATOR: All the evidence SIU had gathered pointed to one person and he’d just left the room in a fit of rage.

BOB BAER: There’s stunned silence. And then Lofgren said, “I guess this meeting's over.” And everybody gets up and leaves. I said, “This is just not possible.” I mean, I knew the guy. I knew his position. It was like, “Well, where's the evidence?” It is sort of like someone says to you, “I know who assassinated JFK and it wasn't Oswald.”

NARRATOR: That’s next time, on True Spies. I’m Vanessa Kirby. Join us next week for the second installment of True Spies: The Fourth Man. Or: if you’re a subscriber to SPYSCAPE Plus in Apple Podcasts, there’s no need to wait. You can listen to part two right now.