True Spies: The Fourth Man Part Two: The Rock Star
++++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?
BOB BAER: And the evidence says it's somebody who's been at headquarters. It's somebody who was head of USSR operations. It's somebody who is counterintelligence. And a guy jumps up, kicks his chair back, and storms out of the meeting.
NARRATOR: I’m Vanessa Kirby, and this is True Spies The Fourth Man Part Two: The Rock Star. The last episode of True Spies ended with a bombshell briefing behind a vaulted door at CIA headquarters. A secret CIA team called the Special Investigations Unit, the SIU, had been poring over the evidence of a suspected KGB mole inside the Agency. Over time, the SIU had not only become convinced that the mole existed. They’d even narrowed it down to one key suspect - someone who was still at work at the Agency. Someone in a senior position. Someone who was present at the briefing. If you haven’t heard the first part of this series, go now and have a listen. There are major spoilers ahead. Now, remember, the hunt for the Fourth Man is an ongoing story. No one has been charged with espionage, much less convicted. What you’re hearing are the facts according to former CIA officer Robert Baer.
BOB BAER: Look, I'm the stenographer in this. I'm the writer. I'm a reporter. This isn't an opinion piece. This is what I was told.
NARRATOR: In her briefing at the CIA, Laine Bannerman doesn’t even have to say a name. The work of the Special Investigations Unit has implicated one man. We won’t name him here. But suffice it to say, he was a big deal.
BOB BAER: It's like saying the president of the United States is a Russian spy. Well, I take that back because they said that about Trump. But you know what I mean.
NARRATOR: A man who had played a role in some of the highest-profile spy-catching cases in modern American history.
BOB BAER: The guy that caught Ames and another spy, Russian spy named Nicholson, caught him.
NARRATOR: The guy tasked with the “post-Ames cleanup operation” to investigate whether all the losses could be accounted for.
BOB BAER: And he's a rock star.
NARRATOR: How could one of history’s most notable mole hunters be a KGB mole himself? He had helped to set the wheels of the Fourth Man investigation in motion. According to Bob, Bannerman and her colleagues believed that after the briefing, this senior official started to panic. He didn’t think that the SIU would be threatening to him. Bob, meanwhile, was oblivious to what was going on. At least, until the morning he showed up to work and saw that the office of one of his colleagues had been covered with yellow tape.
BOB BAER: I knew about the guy and he had been in Moscow. He had several problems that according to the people in Moscow, he could never pull the trigger to actually meet an agent in Moscow.
NARRATOR: Other than his lackluster reputation around the office, Bob didn’t know much else about this colleague. Well, a lackluster reputation, and one other thing…
BOB BAER: Worse than that - and this was fairly common - is he had a Russian girlfriend.
NARRATOR: Now, an American officer dating a Russian was nothing out of the ordinary. But it did create an opening for Russian intelligence to come in and unsettle their US counterparts.
BOB BAER: They'd come to Washington and say, “Hey, your guy in Moscow is hanging out with this girl who's not very reputable.” So they would get called in by the FBI. And the FBI was constantly dealing with CIA officers who were dating Russians. They're mostly male in those days. So the Russians were sowing distrust. And they had a long history of sending in faux defectors, implicating somebody else in either stealing money or selling them secrets. So the Russians have a lot of people simply meant to drive the CIA crazy. And when you look at the Fourth Man story, you can never not factor this in.
NARRATOR: Creating chaos, making up false stories, and framing innocent people is all part of the Russian playbook - a smorgasbord of subtle operations that the Kremlin call ‘active measures’.
BOB BAER: The whole Oliver Stone movie stuff about JFK was ultimately Russian disinformation and it stuck. How many Americans believe that the CIA killed JFK? A lot. And you go back to the origins of this and it started with the Russians.
NARRATOR: Bannerman’s briefing had ratcheted up the atmosphere of suspicion and finger-pointing within the Russian counterintelligence arm of the CIA. But for all anyone knew, the whole thing could have been cooked up by Russia to confuse and distract the Americans. Whatever the case was, the SIU had unwittingly set off a chain of unpleasant events in their workplace. Bannerman had never said outright that her suspect was the mole in question. But the briefing had a seismic effect in the office.
BOB BAER: But it was just an implicit accusation without mentioning a name. And then what interested Bannerman and Worthen and Hough was that they started taking revenge against them.
NARRATOR: Meaning, they believed the suspect was taking revenge against them. The first act of revenge, according to Bob? The FBI analyst Jim Milburn was removed from SIU. That stripped the group of FBI input. But if Milburn couldn’t be part of the investigation, he was going to take the investigation with him. Bob says he took SIU’s matrix and their data off the easels that held them, rolled the documents up, and carried them to the FBI. Just before Christmas 1994, Milburn’s former colleagues learned just how smart that decision was.
BOB BAER: One morning, they come into work and their offices. SIU, it’s a little vault, has been raided. All their files are gone.
NARRATOR: The SIU’s findings had been too secretive to be documented in digital form. Everything was kept on paper. Good thing Milburn had acted quickly. Bannerman was certain that her suspect was the culprit. But in a later conversation, the same high-ranking official had told Bob Baer that the FBI had led the charge. It had come “roaring in” to take it over. The raid’s true origin is still unclear. Other CIA officials told Bob it simply wasn’t possible for the FBI to intervene in an internal CIA investigation like that. Bob says he wasn’t able to get a definitive answer from the FBI. Whatever happened, it had serious consequences for the SIU.
BOB BAER: So they're left with nothing.
NARRATOR: All of their files are taken out from under them. For Bannerman, it wasn’t just upsetting that the CIA had lost control of the investigation. What really alarmed her was that the FBI now possessed everything that was known about Max, the KGB agent who had tipped off the CIA to the possibility of a Fourth Man or woman. If there was a traitor in the FBI who hadn’t known about Max…well, he might very well learn now. And that meant that Max and his Russian handlers were likely to be in serious danger. Bannerman, Bob says, was crestfallen. And she and the rest of the SIU team - women who were once deeply devoted to their jobs - soon found that their skills and ambition were put out to pasture.
BOB BAER: Then the three of them are moved to horrible jobs where they're doing nothing, shuffling paper.
NARRATOR: Remember how tense and suspicious the atmosphere at the CIA was before SIU presented the results of their investigation? Well, you might imagine, things only got worse after that. The FBI ordered the three women to sit for polygraph tests, asking each of them: “Are you a KGB spy?”
BOB BAER: These ladies felt cornered at this point. They didn't know whether they were going to get fired.
NARRATOR: And then there’s the fact that the SIU’s suspect, the man who they believed could actually be a Russian spy, was still their coworker. Even though he had been fingered by the investigation, there was nothing to pin the evidence on. He still showed up to work every day to do the same job as before. Only now, the women told Bob, he was lashing out. Bob says that the officer under suspicion wrote a series of memos accusing SIU of withholding evidence in their investigation. An allegation like that amounts to obstruction of justice - a very serious charge - and he called for an investigation. If the head of counterintelligence operations had heeded his call, the matter would have been picked up by the Department of Justice, and Bannerman would have been vulnerable to prosecution. Fortunately for Bannerman, the matter never went to the DoJ. Things were bad enough as it was. Her career had flatlined. So Diana Worthen, Bannerman’s teammate, went to Bill Lofgren, who was then Russia Division Chief. She told him that the SIU believed that their high-ranking colleague was attacking them and that he had played a part in taking their jobs from them. According to Bob, Lofgren thought that the senior officer’s reaction to the briefing had been telling. And with his help, the SIU hunt for the KGB mole was revived. That’s how Bob became an unwitting part of the first investigation.
BOB BAER: Well, in ‘95, I led a group, it was called South Group, and I was back at Langley, and it included the Caucasus and Central Asia. I had eight stations. And one day, Lofgren calls me up. He's head of the division, and said, "I would like to assign three people to you, temporarily, to your group." And I was undermanned, so I said fine.
NARRATOR: But there was a catch.
BOB BAER: Laine Bannerman came to work for me, but Lofgren added that she's going to be working on a project - don't ask her about it. She's not going to tell you. She's not going to be on the computer system and she's going to be coming in on weekends and don't ask about it.
NARRATOR: Unbeknownst to Bob Baer, the hunt for the most important mole in CIA history was taking place right under his nose. Bob did what he was told. He didn’t ask questions. He just let the SIU carry on with whatever they were up to.
BOB BAER: I didn't ever ask about Russia. I didn't ask to read Russian reporting. I just didn't want to know because of the paranoia. And I certainly didn't ask Laine Bannerman, "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: Of course, the SIU’s files had all been taken in the raid, so they had to reconstruct them from memory. Bannerman received a boost when Lofgren moved her to a different division, where she had access to more of the Agency’s Russia files. Ostensibly, her suspect was still in charge of the Fourth Man investigation. But according to Bob, Bannerman believes he started throwing out red herrings for the FBI.
BOB BAER: And then Laine watches as there are various suspects that are put under a microscope. They’re rejected. One, Brian Kelly, it ended up destroying his life. It was rejected. O'Reilly, and Joe Hayes. And it's almost like these red herrings are being put up and they don't go anywhere. And finally, the FBI says by 1997, they threw up their hands and said, “This is ridiculous. We're not getting anywhere. You're wasting our time.”
NARRATOR: With no one to blame the losses on, the investigation floundered. Bannerman kept her fingers crossed that Max, the Russian agent who had helped seal the deal in the arrest of Aldrich Ames, could deliver one more piece of key information in the Fourth Man case. Instead, as the SIU investigation lost steam, Max did speak up - but about another mole. Harold ‘Jim’ Nicholson became the subject of the CIA and FBI’s attention, derailing SIU’s search. Bannerman and her colleagues knew they’d have to cut their losses.
BOB BAER: And like these things so often happen, they didn't have enough to pinpoint the guy absolutely other than by deduction. And then the investigation was closed down.
NARRATOR: Demoralized, Bannerman retired from the CIA within just a few years in 1998. So did Diana Worthen. Maryann Hough followed suit. So why are we still lacking answers nearly three decades on? It’s a question that Bob wonders about to this day, and a question that has long nagged at his former boss, Bill Lofgren. As you might remember from Part One, Lofgren was the one who told Bob about the mole, way back in the mid-90s, outside the CIA headquarters building.
BOB BAER: And he drops a name on me.
NARRATOR: The name of Laine Bannerman’s chief suspect.
BOB BAER: I know Lofgren and he's not paranoid, and he doesn't believe in conspiracy theories. But 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?”
NARRATOR: The idea that this person might have worked for the KGB was, to Bob, completely unthinkable.
BOB BAER: I thought, this is just stupid. It is like someone says to you, I know who assassinated JFK and it wasn't Oswald. And I said, “Well, you better have the evidence, like the forensics and everything else.” And so I say to Bill, “What do I do with this?” And he says, “Well, go back to the investigators and get their viewpoint on it.”
NARRATOR: But Bob had long done his time with the CIA. By this point, he’s spent a decade and a half writing books: a couple of memoirs, some histories, a novel. Investigating a mole was not on his list of priorities.
BOB BAER: When Lofgren tells me the story, we're driving back from lunch, I go, “I had a - wait, I don't want to do intelligence stuff. I don't understand this.” I had nothing to do with counterintelligence. I had nothing to do with Russia, really. But the story was so good in its left with a mystery. And when you get the primary sources telling you the same thing, there is a story to be written down.
NARRATOR: For Bob the author, this was a book idea handed to him on a silver platter - a real-life thriller, playing out in real-time. Not only did he have the contacts to unearth details that would otherwise be off-limits to a journalist, he had a reporter’s nose for a good story. And the hunt for the Fourth Man was, he had to admit, a pretty good story. Plus, there’s the vote of confidence from his former boss, for whom the whole saga holds great personal meaning.
BOB BAER: Lofgren will say his greatest regret in his life is he didn't stay head of the division so he could get some closure on this.
NARRATOR: Not that Lofgren didn’t make an effort. Bob found out that he put up a fairly big fight.
BOB BAER: He did take it to the FBI before 2006. He has knowledge. He has sources of his own. And he got into an enormous fight with the FBI. He told the FBI that this guy was run by the second chief director at counterintelligence. And at that point, the FBI did not think that counterintelligence was running cases in Washington or London or anywhere else. They said, “It's just not the way it works. They stopped doing that in the’50s. They don't do it anymore. You're out of your mind, and give us some real evidence.”
NARRATOR: But Bob had an inkling there was something bigger at play: something that had less to do with the Fourth Man, and more to do with a systemic issue in the intelligence agency.
BOB BAER: The word is, “Don't bring us bad news.” And I know that seems counterintuitive to you. But in order to take bad news to CIA management, you have to have a smoking gun. Otherwise, they don't want to hear it.
NARRATOR: So - the FBI hadn’t unearthed an answer for Lofgren, and the CIA had left the mystery unsolved. So Lofgren turned to someone with a track record of doggedly pursuing challenging cases, and of speaking openly. Someone who wasn’t afraid of being the bearer of bad news.
BOB BAER: You don't want to be the skunk at the wedding.
NARRATOR: Now, Bob isn’t your average journalist, knocking on doors and making cold calls. He knows nearly everyone involved in this story. In the case of Laine Bannerman and her teammates, he was their boss while the investigation was going on.
BOB BAER: And I knew both of them. I knew them very well. I saw them around the division and I knew that they were very serious. They were married to their jobs. They did counterintelligence. They did Russian operations. And so one day we go out to Laine Bannerman's house and I take a notepad and then just start taking notes.
NARRATOR: Of course, Bannerman wasn’t exactly in a position to speak freely about everything she knew.
BOB BAER: She warned me that the evidence that she was giving me was more or less open source. I mean, we knew about it from the Ames investigation, from the Howard investigation. And she said to me, “There's a lot more evidence I can't talk to you about because it's still classified.”
NARRATOR: But Bob was not deterred.
BOB BAER: I said, “All right, I got a little bit of it.” And then we fly out to Tucson - Lofgren, me and Laine - and we talked to Diana.
NARRATOR: That’s Diana Worthen, one of the SIU investigators.
BOB BAER: Both of them had worked on the initial investigation with SIU, Special Investigation Unit, between May and basically December. And then they were just sort of shunted aside, in effect, demoted. So this had bothered them all these years, and they'd never stopped thinking about it.
NARRATOR: Imagine working full-time on an investigation so consequential for Americans and their assets and allies - then losing your post and seeing the whole issue gets swept under the rug. For many, many years.
BOB BAER: The closest they came to closure was in 2006 when the FBI showed up at their houses and said, "Tell us again about the Fourth Man investigation. What are we missing? Do you know anything else?" And Laine was pulled aside by an FBI analyst who said, “Laine, you guys were right in '94.” He said, “There was a Fourth Man. He worked for KGB counterintelligence rather than external intelligence, and he probably did it out of revenge.”
NARRATOR: The SIU did have one last run-in with the man they believed could have been a Russian mole in 1999, at a memorial service in Langley, Virginia. He was civil to the women, Bob says. But his small talk raised eyebrows, nonetheless.
BOB BAER: He says, “Hey, I'm going to Moscow and I'm going to go see this counterintelligence officer Budanov, who's famous. He's an American targets officer. And we're going into business together.”
NARRATOR: Budanov was an ex-KGB officer. He was also a buddy of Kim Philby, the famous Soviet mole in MI6.
BOB BAER: And it was almost like, “Yey, the world's moved on. The Russian thing’s dead. We're all making money. And any of your suspicions about me, it's just irrelevant.”
NARRATOR: Could he really be telling the truth? Or was he just barbing the women, as if in payback for the discomfort they’d caused him with their investigation? Years later, Bob went and asked him.
BOB BAER: And he did go to Moscow, and he did meet Budanov, and he did meet the head of Russian counterintelligence in Moscow, as he told me. And it went nowhere. It was just a very unpleasant meeting. The Russians were insulting to him and he laughed. And he never did any business.
NARRATOR: Even if their former colleague had been dangling something in front of the women, taunting them with an odious truth, it wouldn’t have been enough to be of consequence. Plenty of people with ties to the US government and its intelligence agencies do business in other countries, including the nation’s adversaries.
BOB BAER: So what? You're in business in Russia and you're consulting on Russia and you're making $1,000,000 a year, whatever it is. Does it mean anything to the FBI? Nope, nothing at all. The revolving door in Washington, there's nothing to be made of it that does the FBI any good.
NARRATOR: The man in question has emphatically denied any allegations of espionage for the KGB. He’s called them “hogwash”. Bob knows him personally and spoke to him for the book. For his part, Bob says he’s not convinced of his guilt, either.
BOB BAER: I find it totally implausible that he's a spy but I haven't seen all the evidence.
NARRATOR: According to Bob, the FBI questioned Bannerman and Hough in 2005, presumably reopening the case. Bob doesn’t know many details about their investigation - and he certainly doesn’t expect to receive them. Writing a book about a highly secretive active investigation did not make him any new friends.
BOB BAER: It's amazing. I mean, I knew that there would be problems, but nothing like this.
NARRATOR: Bob’s unofficial investigation - an investigation of the investigations, as it were - has made him persona non grata in the world of American intelligence. The more he dug for answers for his book, the more resistance Bob came across. The same hostility and paranoia and unease that the SIU had endured at the CIA in the 1990s, Bob was rediscovering as a civilian investigator, many years after the fact.
BOB BAER: It's just, for me, it's just the atmosphere is so nasty and counterintuitive.
NARRATOR: Part of the problem, Bob says, is a decades-long rivalry between the CIA and the FBI. Because of their mutual dislike, the Agencies aren’t cooperating with one another. Even still - Bob says there’s every reason to believe that the FBI is chipping away at the mystery at this very moment.
BOB BAER: When the FBI comes and visits me in the middle of nowhere, in the mountains in Colorado, and in a very pleasant way want to know what I might have come across, and they did. And the fact that they're going to visit Lofgren and Laine and the rest of them as of a couple of months ago, I have no doubt that it's a very active investigation and they're just waiting for that piece of evidence that can close this either exonerate who's on their list and find the right person or enough evidence to take this to the indictment. The FBI does not keep open an investigation unless they have the predicates of espionage and they have something solid. Every 90 days, they've got to go to the boss and say, “Why do we want to keep this open? Because there's some nosy person like Bob Baer who's going to make this a spectacle. Why do we want to keep it open?” And they have their reasons.
NARRATOR: One reason, Bob says, is because Russian defectors have approached them with information. He can’t share details, and he certainly won’t identify them. Still - if the FBI has been on the case, and if people are still giving up new information about the mole, shouldn’t intelligence officials have answers by now?=
BOB BAER: This is the mystery of it. Why has it been the longest-running espionage case in American history? It's essentially been open since 1994. And as we speak, I believe it's still going on. I mean, don't you find that a mystery? Don't you find that curious?
NARRATOR: Remember the CIA employee whose office was inspected as the scene of a potential crime, shortly after Bannerman’s briefing in 1994? Clearly, the FBI didn’t wind up indicting him for the crimes of the Fourth Man. But his story raises possibilities that Bob says must be considered.
BOB BAER: The Russians are perfectly capable of framing somebody to protect the real Fourth Man.
NARRATOR: In which case, could the SIU’s suspect have been framed? Or could all of these dead ends be the handiwork of the Russians, hell-bent on confusing and distracting the American intelligence agencies? Just think - the CIA took its eyes off Russia after the fall of the Soviet Union. Then there were the arrests of Ames and Hanssen. By the mid-90s, when people were becoming aware of a possible Fourth Man, the Agency was keen to focus on other things.
BOB BAER: But we couldn't see this because Ames gave up all our sources. Hanssen gave up the rest, and then the ones that Howard gave up. So by 1998, we were blind on Russia. Laine Bannerman ran Russian operations. She said we didn't have a source. Diana at the time ran internal operations in Moscow from Washington. We didn't have a source. I called the ambassador at the time in Moscow, Jim Collins. He says, “I saw nothing in the CIA. I could get better information from taxi drivers in Moscow.” And then Mark Medich, who is Clinton's national security director for Russia, said there was nothing. So when you got that many sources… if there was nothing, there was nothing.
NARRATOR: All the while, Vladimir Putin was gaining steam until 1999 when he first became Prime Minister - a former KGB officer with a dark promise for Russia and for the west. A whole lot can happen when the United States looks the other way.
BOB BAER: All these betrayals, all these spies made sure we knew nothing about Russia. And that is just a fact.
NARRATOR: That’s the political importance of this story. The CIA has played a role in bringing down despotic leaders and installing ones with values it perceived to be more in line with western interests. If US intelligence had known more about Russia, Bob argues, maybe they would have intervened to prevent Russia from falling into Putin’s hands.
BOB BAER: Between all closing down Russian operations and all the betrayals, Putin came out of nowhere. I mean, the State Department knew more about Putin because he was in St. Petersburg and they'd met him from time to time. And when he went into Russian intelligence again, the FBI agent assigned to Moscow, the league was meeting. So we knew a little bit about him, but it wasn't the CIA. Could we have prevented this? Could we have seen Putin? Could we have seen what was going on? I don't know. But you have to look at Putin's assent in ‘99 on New Year's Eve as it's a silent coup d'etat. It was. And we missed it in the same way we missed Pearl Harbor.
NARRATOR: But there’s more to this story. And maybe with time, maybe with persistence, maybe with the hard work of investigators like Bob Baer, all of the details will finally fall into place.
BOB BAER: If there are any Russians who know about this and they're scared of Putin and they need a lot of money, all right. Time to defect and tell us what's going on here. And bring some documents with you.
NARRATOR: You can learn more about the Fourth Man - or what we know of him, at least - in Bob’s new book, The Fourth Man: The Hunt for a KGB Spy at the Top of the CIA and the Rise of Putin's Russia. I’m Vanessa Kirby. Join us next time, as we meet Kathy Stearman, the trailblazing female FBI agent who finds herself taking down terrorists across the Sub-Continent. Or, if you’re a subscriber to *SPYSCAPE Plus* on Apple Podcasts, there’s no need to wait: you can listen to it right now.
Robert Baer spent 21 years in the CIA as a field operative and resigned after leading an aborted attempt on Saddam Hussein. His memoir See No Evil was made into the Academy Award-winning movie Syriana starring George Clooney. He is an intelligence columnist and a regular BBC and CNN contributor as well as lecturing various US government agencies.