The Felix Bloch Affair: Assessing the Damage to U.S. Security

Introduction

On the basis of currently available
public information, it is not possible to
determine the validity of the allegation
that a senior foreign service officer
named Felix S. Bloch has been spying for
the Soviet Union for many years. For
whatever reason, the Federal Bureau of
Investigation, which is assessing the
factual basis for such an allegation, has
thus far not pressed charges against
Bloch.

What is possible — and of the utmost
urgency — is to assess the damage an
individual with Bloch’s background,
experience and access to information could
have caused
if, in fact, he were
in the employ of the KGB. The Center for
Security Policy has undertaken to develop
materials relevant to such a damage
assessment, drawing from unclassified
sources and the considerable experience
of its associates with the policy-making
process and security procedures.

Bloch’s career path has involved him
primarily in East-West economic,
financial and technology affairs. As U.S.
and Western security policy in these
areas is one of the Center’s principal
concerns, this paper provides
chronologies of important events that
occurred in this portfolio of issues and
to correlate these events with Bloch’s
various assignments. This is not to
suggest that in many of his positions —
such as that of Deputy Chief of Mission
in Vienna — Bloch would not also have
had critical access to U.S. intelligence
and policy information concerning other
sensitive issues such as arms control
negotiations, nor is to suggest that
Bloch was necessarily responsible for the
final disposition of economic, financial,
and technology matters within the United
States government.

It is, rather, intended to indicate
the kinds of developments Bloch would
likely have been following closely, and
in which the Soviets would have had a
keen interest. Indeed, as the Center and
its associates have been saying for some
time, the principal vulnerability of the
Soviet empire today resides in the
portfolio for which Bloch had
responsibilities in the course of his
career.

Chronology of Bloch
Assignments:
href=”#N_1_”>(1)

1958 Joined the State
Department; intelligence research
specialist.
1960 Dusseldorf,
West Germany; Commercial Officer
at the American Consulate.
1963 Caracas,
Venezuela; American Consulate.
1965 Attended
Berkeley for M.A. in advanced
economics.
late 1960s Department
of State, Washington, D.C.
early 1970s West
Berlin; Trade Official.
mid-1970s East
Germany; Economic Officer
(several years).
1978-1980 Singapore;
Foreign Service Inspector, roving
official in the inspection corps,
responsible for auditing
diplomatic outposts.
1980 Vienna;
Economic Counselor.
1983-
June 1985
Vienna;
Deputy Chief of Mission under
Helene A. von Damm.
June 1985-
April 1986
Vienna;
Acting Ambassador.
April 1986-
July 1987
Vienna;
Deputy Chief of Mission under
Ronald S. Lauder. Transferred to
D.C. in July 1987 two months
ahead of schedule.
July 1987-
July 1988
Washington,
D.C.; Senior Executive Seminar.
July 1988-
June 1989
Washington,
D.C.; Regional Political-Economic
Policy Director, Bureau of
European and Canadian Affairs.

Chronology
of Recent Events Concerning Bloch:
href=”#N_2_”>(2)

Spring ’89 Bloch filmed by French
counterespionage agency passing
briefcase to Soviet agent in
Paris. Agent identified in French
newspapers (Liberation and
Journal du Dimanche) as a member
of the UNESCO mission and of the
KGB’s agency dealing with
technological secrets.
May
14
Phone
call from Soviet agent (Pierre)
to Bloch.
mid-May Bloch
meets with Pierre in Paris.
May-June Bloch
meets with Pierre in Brussels.
June
20
Mrs.
Bloch stays at home of Austrian
Foreign Minister Mock and
accompanies him to a farewell
dinner for Turkish ambassador.
June
22
“Virus”
phone call to Bloch from Pierre.
June
22
Bloch
placed on administrative leave
with pay; stripped of building
pass; Bloch voluntarily
surrenders diplomatic passport.
late
June
Austrian
Foreign Minister Mock informed by
his own Interior Ministry and by
U.S. Ambassador Grunwald of Bloch
investigation.
July
18
Bloch
participates in Atlantic Council
conference.
July
21
ABC
airs report.
July
21
State
Department discloses FBI
investigation.
July
24
President
Bush states that he has
“known about this matter for
some time.”

Recent
Public Statements on the Bloch Affair:
href=”#N_3_”>(3)

President
Bush:

    “I’ve known about this
    matter for some time, and the
    minute I heard about it, I was
    aggrieved because it is a very
    tragic thing should these
    allegations be true… The
    investigation is going on. And
    these are very serious matters
    and a thorough investigation
    takes a good deal of time.”
    (Washington, D.C., 24 July 1989)

Eduard Shevardnadze, Soviet
Foreign Minister:

    Bloch “never had any
    relations with us, no relations
    which could arouse any suspicions
    whatsoever.” (Paris, 29 July
    1989)

According to the Associated Press, Gennadi
Gerasimov, Soviet Foreign Ministry
spokesman
said that the Soviet
Union had no connection with Bloch and
that allegations that Bloch was working
for the Soviets are the result of a new
“wave of spy mania” caused by
the U.S. media.

Alois Mock, Austria’s Foreign
Minister:

    There is “a certain
    suspicion on the U.S. side
    reaching back into the
    1970s.” (July 1989) “It
    is unexplainable how Bloch was
    able to remain so long in such
    high positions.” (Viennese
    newspaper Kurier, July
    1989)

Stanislav Levchenko, former KGB
officer
who defected in 1979.

    “Many parts of this case are
    not clear, and if allegations
    that Mr. Bloch was cooperating
    with the KGB for a long time,
    then probably he was recruited
    before he got upset about this
    Ambassador or other ambassadors.
    He was stationed before in East
    Germany, as I understand, as an
    economics officer.” (ABC
    Nightline, 24 July 1989)

    “If we are talking
    about…the State Department…it
    is not impossible at all that at
    some level there could be one,
    two, three other assets of the
    Soviets who one way or other
    could have learned about the
    investigation and tipped [Bloch]
    off.” “This Week with
    David Brinkley,” 30 July
    1989)

Reported Conversation between a Soviet
agent (code-named Pierre)
to
Bloch, by telephone (the same agent to
whom Bloch allegedly gave briefcase):

    “A bad virus is going around
    and we believe you are now
    infected.” (ABC News, 24
    July 1989)

Table showing Bloch’s career

Conclusion:

The Center for Security Policy believes that it is absolutely
imperative that the importance be understood of Western economic,
financial and technology security policies toward Warsaw Pact
countries. Given the acute — and steadily worsening — state of
Soviet bloc economies, it should come as no surprise that the
USSR places a premium on influencing Western policies designed to
safeguard alliance security interests in this field.

Accordingly, the Center believes that, in the wake of
revelations that a very senior foreign service officer and
specialist in this portfolio of issues may have been a long-term
Soviet spy, the following steps are in order:

  • A vigorous effort should be made at senior levels of the
    U.S. Government to assess whatever damage may have been
    done by Bloch should the allegations prove true.
    • Independent in-depth reviews should be conducted,
      for example by the President’s Foreign
      Intelligence Advisory Board and perhaps a new
      “Team B” in addition to those
      undertaken by duly constituted
      counter-intelligence organizations.
    • Joint hearings of the Senate and House
      Intelligence Committees should be held to
      consider the findings of such reviews and the
      extent to which corrective steps deemed to be in
      order.
    • Insofar as possible, the results of these reviews
      should be shared with the American people. At a
      minimum, doing so will alert them to the risks
      that attend some of the policy choices affecting
      the economic, financial and technology security
      portfolio.
  • If a case can be made that Felix Bloch engaged in
    espionage activities for the Soviet Union, the United
    States government must prosecute him. Under no
    circumstances should the potential damage done to public
    perceptions of the trustworthiness of Soviet
    interlocutors or the possible embarrassment of those who
    worked with Bloch during his years in the State
    Department be permitted to prevent such prosecution.
  • Finally, a moratorium must be imposed upon further
    liberalization of economic, financial and technology
    relations with Soviet bloc countries pending completion
    of the aforementioned damage assessment.
    • In particular, the creation of new high-level
      U.S.-Soviet working groups on economic issues and
      the decontrol of sophisticated dual-use
      technology should be deferred indefinitely.
    • Expanded Soviet access to U.S. banking
      information should be blocked by postponing the
      opening of a New York branch of the Soviet Bank
      for Foreign Economic Affairs pending the results
      of a damage assessment. Such a New York branch
      would also enhance Soviet espionage capabilities.

1. Drawn from press reports and other
publicly available data.

2. Drawn from press reports and other
publicly available data.

3. Drawn from press reports.

Center for Security Policy

Please Share:

Leave a Reply

Your email address will not be published. Required fields are marked *