When the FBI Spent Decades Hunting for a Soviet Spy on Its Staff

A tip provided by a double-agent for the KGB set off one of the most self-destructive mole hunts in FBI history

“There was one file on our man in the FBI,” the ex-KGB man says. “He was retired and living in Queens.” That man, he says, was the mole. (Grant Delin)
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Against the information Kulak provided, however, the mole hunters had to consider the possibility that he was really acting for the KGB. “The KGB was aware you can cause the FBI to chase its tail,” says Paul D. Moore, a retired longtime analyst for the bureau.

The CIA, too, was unsettled on the question of Kulak’s bona fides. James Angleton, the counterintelligence chief, never believed he was genuine, but then Angleton placed his faith in only one Russian defector, who persuaded him that the Sino-Soviet split that emerged in the 1960s was all a plot to deceive the West. That idea was widely regarded as nutty then and has been soundly discredited since. After Angleton was fired, his successors concluded that Kulak was a legitimate source, and two CIA counterintelligence specialists assigned to review his FBI files agreed.

But others who have doubted that Kulak was working for the United States point out that when he returned to Moscow in 1976 he was not executed—unlike the GRU officer Dmitri Fedorovich Polyakov, who provided valuable information to the CIA and the FBI for 18 years until the CIA mole Aldrich Ames betrayed him in the 1980s. Kulak survived his homecoming, they note, even though American media reports had hinted that the FBI had a KGB source in New York. In a 1978 book, Legend: The Secret World of Lee Harvey Oswald, author Edward Jay Epstein went so far as to publish the code name FEDORA and describe him as a KGB officer working undercover at the U.N. and specializing in “science and technology.” Before leaving New York for the last time, Kulak had agreed to provide information to the CIA in Moscow, and did so, leaving material in a dead drop there. But with his cover all but blown by the book, the agency, fearing for his safety, offered to exfiltrate him—to spirit him out of Moscow. He declined and said he would be fine. He was never arrested, and the agency eventually received word that he died of natural causes in the early 1980s.

Oleg Kalugin, a major general in the KGB who became an outspoken critic of the agency and moved to the United States in 1995, said in an interview that the Soviets “suspected [Kulak], but they did not have enough evidence” to justify going after him, especially given his meritorious record during World War II. “He was a Hero of the USSR,” Kalugin says, referring to a Soviet award roughly equivalent to the Congressional Medal of Honor. The medal, Kalugin and others said, gave Kulak a kind of cloak of immunity.

On the question of whether the KGB had a mole in the FBI, Kalugin says yes, it did. Kalugin worked in New York undercover for the KGB for five years starting in 1958. At first, in a series of interviews, he told me he was “vaguely familiar with the case. I did not have access to that case. I simply knew of the existence of a guy in the bureau. But he did provide genuine information. There was such a person as Dick.” Later, however, Kalugin said he had actually paid the FBI agent for his services to the KGB, more than once and in person. “I paid Dick, but I didn’t know his true name,” Kalugin says. He did not say how much he paid.

The FBI paid Kulak $100,000 over 15 years, but he may have had more than money on his mind. One agent says Kulak worried constantly that UNSUB Dick would find out that he was spying for the FBI and tell the KGB about him. “That’s why he dimed him out,” the FBI man said. Kulak, he said, “kept telling the bureau to find him.”

But over time, the mole hunt faded. Palguta’s retirement in 1976, while Kulak was still in New York, left Hengemuhle as the sole active member of the original team. By the time Hengemuhle retired, in 1987, other priorities took precedence. In 1985, the FBI was busy making arrests in what became known as the Year of the Spy, rounding up John A. Walker, the head of a Navy spy ring, Jonathan J. Pollard, the Navy analyst who spied for Israel, and Ronald W. Pelton, a former employee of the National Security Agency who passed secret information to the Soviets.

By then the first FBI mole had been discovered—Richard Miller of the Los Angeles office had been arrested in 1984, convicted of spying for the Soviets and sentenced to life in prison. In 1996, Earl Edwin Pitts became the second; he was sent away for 27 years. (Hanssen, the most notorious Soviet mole in the FBI, was not caught until 2001; he was sentenced to life.) But even though the trail to UNSUB Dick had grown cold, the FBI wasn’t about to forget about the case.

In the mid-1980s, an analyst named Robert H. King concluded that he had identified UNSUB Dick. King had worked at the CIA before he joined the FBI in 1980. He and his FBI colleague James P. Milburn specialized in detecting penetrations of the bureau.

King had the benefit of two pieces of information learned through Kulak on his second tour. First, that the KGB had a source who had retired from the FBI and lived in Queens, a bedroom borough of New York favored by a multitude of FBI agents who could not afford the rents in Manhattan. And second, the initial of that source’s last name was the Cyrillic letter G, which was also his KGB code name. King wondered whether the KGB source in Queens was UNSUB Dick.


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