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After the molehunts 

At the Raleigh espionage conference, a subterfuge of spies, lies and family ties

Stage a gathering of spooks, and you never know who might show up. So it was last week, when the North Carolina Museum of History hosted the first Raleigh International Spy Conference. The brainchild of Bernie Reeves, a serious spy buff and publisher of both Metro magazine and the now-defunct Spectator newsweekly, the conference was a rare public gathering of people accustomed to life in the shadows.

After passing through a lobby display of cloak-and-dagger gadgets--spy cameras hidden in shoe brushes, compasses concealed in cufflinks and the like--attendees entered a dimly lit auditorium to hear from renowned intelligence authors and covert operatives. During the conference's three sessions (and two cocktail parties--true to the stereotype, spies can hold their liquor), folks swapped stories about Russian espionage against the United States.

It was heady stuff, better than a Bond film. Former KGB Gen. Oleg Kalugin, now a U.S. citizen and private intelligence consultant, spoke firsthand of his years recruiting agents in the United States. Keith Melton, who writes about and teaches spy tradecraft, gave a detailed dissection of how the Russians conducted their "dead drops"--secret transfers of documents, money and other items between agents and their handlers.

Other speakers focused on the successes and failures of U.S. counterintelligence, and it was here that the most compelling stories emerged. Consider the case of conference headliner Brian Kelley, a CIA officer who was mistakenly caught up in one of the FBI's biggest spy hunts. Back in February 2001, the FBI arrested a turncoat in its own ranks, the now-convicted Robert Hanssen, who gave the Russians vital national security secrets for more than a decade. Only later did the public learn that, for nearly four years before they nabbed Hanssen, the FBI heatedly investigated the wrong man, the CIA's Kelley.

They tapped Kelley's phones, at work and at home. They installed a secret camera in his office and snooped in his computer. They broke into and searched his house. They grilled him and his close relatives, telling them he was likely a traitor. At the FBI's insistence, Kelly was even banned from CIA headquarters for a year, his career held hostage.

The FBI, we now know, was way off. Hanssen was the mole they sought, and Kelley had done nothing but excel at his job as a CIA counterintelligence expert. He was, in fact, a man who knew too much--too much about one Felix Bloch, the Triangle's very own Cold War mystery man.

Bloch, many will recall, was a career diplomat who, in 1989, after 31 years with the State Department, was fired under a cloud of suspicion that he had shared secrets with a KGB agent. Though the FBI and the media shadowed him for six months, the government was never able to forge an espionage case against him. In spite of the strong suspicions held by intelligence officials, Bloch was never charged. (For the full background, see "Spy Like Us?" , )

Kelley was the one who first connected the dots that led to the Bloch investigation. In 1989, Kelley was tracing the activities of a portly, bearded gentleman who lived in Vienna, carried a Finnish passport and used at least three names. Kelley became convinced that the man was a KGB operative and was alarmed to find that the man had repeated contacts with Bloch, who had served as the Deputy Chief of Mission at the U.S. embassy in Vienna from 1980-87. When French intelligence photographed Bloch passing the bearded man a shoulder bag in a Paris restaurant, Kelley smelled a rat. He alerted the FBI, which began an intensive espionage investigation of Bloch.

But then the bottom fell out. Someone with knowledge of the investigation tipped off the KGB, which, in turn, placed a warning call to Bloch, according to the FBI. With its investigation compromised, the FBI immediately sent agents to confront Bloch with their suspicions that he was spying. You've got it all wrong, Bloch told them: Those weren't secret documents I passed to the man in Paris, they were postage stamps. Bloch said he knew the man not as an enemy spy but as a fellow stamp collector.

The FBI didn't buy it, and neither did the State Department. Fired under the civil service version of a dishonorable discharge, Bloch moved to North Carolina, where he has since led a mostly quiet life, first as a grocery story employee and then as a bus driver for Chapel Hill Transit. (Though two minor shoplifting arrests in the early 1990s did catapult him briefly back into the headlines.)

Through it all, he's done little to deny the spying rumors, saying instead that he shouldn't have to make denials. "The government, the leaks, assert that I'm guilty," Bloch told The New York Times Magazine in 1990. "Apparently they can't prove itÉ There's a presumption of innocence in this country. Someone should not be put in the position of saying 'I'm innocent.'" Contacted by the Independent in 2001, Bloch was similarly mercurial. "Greta Garbo had something to say about divulging personal details," he noted dryly in a brief telephone interview. "If you do, then they're no longer personal."

Meanwhile, in a mad search to find who had told the KGB about the Bloch investigation, the FBI mistakenly honed in on Kelley--the very man who had identified Bloch as a potential spy in the first place. Later, it was learned that Robert Hanssen had, in fact been the KGB's tipster. When Hanssen was busted, Kelley was exonerated and restored to his work at the CIA.

Kelley told the whole harrowing story to the conference, how the mole hunters nearly destroyed his life. And sitting in the audience, a surprise, unannounced guest took it all in with a deep appreciation of what it means to find one's self unexpectedly under the government's glare. Andrea Bloch, daughter of Felix, could sympathize.

"I came to the conference," Andrea Bloch explains, "because I heard my father was going to be a part of it." She had seen the column Bernie Reeves wrote in Metro last January to announce the spy event. In it, Reeves bluntly labeled Felix Bloch a "traitor" and wrote: "He is not just the spy among us; he is the highest-level known espionage agent since the Alger Hiss days. Yet, while Brian Kelley's life was torn apart, his prey is alive and well in Chapel Hill. After what Kelley went through as the Wrong Man, it is understandable that he wants Bloch, the man he knew to be a high-level Soviet agent--who is a free man due to the machinations of his nemesis Robert Hanssen--brought to justice. So do I."

Hearing Felix's name kicked around at the conference as though he were a convicted traitor, Andrea says, brought back fresh memories of what it was like to be thrust into the upside-down, trust-no-one world of the spy wars.

"Do you want to know how I found out?"she asks. "I was 25 years old, I was trying to start a career acting in New York and working in an art gallery. One day, I'm at work, and a call on the phone comes. A man says, I'm so-and-so from the FBI, and I need to talk to you. Out of the blue, out of nowhere."

An hour later, agents showed up at her place of work, "trench coats and all," and told her, "We believe your father is spying for the Soviet Union."

"It was absolutely the strangest thing I've ever heard in my life," she remembers, and today she remains doubtful of the allegation. She was grilled by investigators and became sure her phones were tapped. "It was like everything unraveled," she says of that time. "You start questioning everything--everything in my life, everything I knew, all my experiences, were suddenly up in the air."

And that is roughly where the story of Felix Bloch remains, "up in the air," suspended in suspicions first leaked to the media 14 years ago.

Nothing Andrea Bloch heard at the conference made her think exoneration for her father is in the offing, but, she did make an unlikely acquaintance. David Major is a former FBI counterintelligence official who worked on the original Felix Bloch investigation, and it seemed strangely fitting that he and Bloch's daughter would cross paths in Raleigh.

Expressing sympathy for Andrea, her mother and sister, whom he called the "unintended victims" in the case, Major offered up an olive branch in the form of a humorous spy story. While investigating Bloch, the FBI bugged the diplomat's Mercedes, something Andrea knew because her mother later found the hidden transmitters. What she didn't know was that agents were trying to eavesdrop on what Bloch would tell his wife when he picked her up, shortly after he'd been confronted with the espionage allegations. "But they couldn't hear anything, because the windows were rolled down," Andrea says, chuckling.

It was a rare moment of levity during her visit to the spy conference, but she knows that Major and his former colleagues continue to remember resentfully Felix Bloch as the one who got away. "It's an open investigation," Kelley says when asked about the status of the Bloch case. "There is no statute of limitations on espionage." EndBlock

More by Jon Elliston


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