New Documents Reveal Truth on NATO's 'Most Damaging' Spy
04/30/2010

For years, from his senior position in Estonia's Defense Ministry, Herman Simm leaked highly sensitive NATO intelligence and the names of Western spies to Russia's foreign intelligence service. In a classified damage analysis, NATO concludes that the former KGB colonel was one of the "most damaging" spies in the history of the alliance.

Everyone thought Hermann Simm deserved to be honored. It was Monday, Feb. 6, 2006, and he was dressed in his best suit to attend the day's event. He had been invited to Estonia's presidential palace to accept the "Order of the White Star" for his "service to the Estonian nation." It was an ironic choice.

It wasn't the only medal Simm received for his services that year. The other honor was one that he could only see on his computer screen, supposedly so as to not jeopardize his cover. Sergey Jakovlev, his handler with the SVR, Russia's foreign intelligence service, appeared on the screen to show him his medal. Jakovlev was also the one who informed Simm that he had been promoted to the rank of major general for having supplied Moscow with the names of all suspected and known Russians working as spies for NATO. Then-President Vladimir Putin was very impressed, Jakovlev told his best spy.

Four years on, Simm has now reached the late phase of his career. Indeed, in his field -- spying -- it is not uncommon to spend one's old age in a small prison cell. Simms is incarcerated in a functional, post-Soviet building made of reinforced concrete in the Estonian city of Tartu, where he wears a plain prison uniform and seeks comfort in the Bible. Photos depict him as an older, gray-haired man with a sad look in his eyes.

This is the same man whom NATO, in a classified 141-page report, has recognized as the spy who was "most damaging in Alliance history." The report alleges that Simm, as the former head of security at the Estonian Defense Ministry, had access to most of the classified NATO documents his country received after joining the alliance in the spring of 2004. Until his arrest, in September 2008, he is believed to have secretly handed over thousands of those documents to the Russians. Some of these contained highly sensitive information about NATO's secret defense policies, "including installation, maintenance, procurement and use of cryptographic systems."

28 NATO Countries Sharing Secrets

According to the classified NATO report, the master spy also "compromised a wide range of NATO intelligence reports and analyses," including ones related to fighting terrorism, secret military plans and counterespionage. Never before, the NATO analysis concludes, has a spy betrayed such a large volume of military secrets for such a long time.

Of course, Simm was not the only spy in NATO's past. For years, Rainer Rupp, a West German who went by the codename of "Topaz," supplied classified information to the Stasi, the secret police of the former East Germany. French officer Pierre-Henri Bunel supplied Yugoslavia with NATO bombing plans during the Kosovo crisis. And Daniel James, who was working as a British general's personal interpreter, relayed sensitive details of his country's military operations in Afghanistan to Iran.

Still, the Simm case reveals just how much of a risk the alliance was taking when it gradually expanded eastward after the end of the Cold War. Each of its current 28 member states now enjoys access to almost all the classified information within the alliance. For experts, this is already unsettling enough. But even more worrisome is the fact that members of the old elite -- whose loyalties once lay with a completely different political system -- now work in the security apparatus of some of the new member states. In other words, people like Herman Simm.

A Swift Rise to Power

Simm was born out of wedlock in May 1947 in the small Estonian city of Suure-Jaani. When he was two years old, his mother barely escaped Stalin's ethnic-cleansing operations and deportation to Siberia. Soon thereafter, she married and left the boy to live with his grandmother and aunt. In school, he was considered ambitious, hardworking and well-adapted.

In 1966, when Simm was studying chemistry in Tallinn, he witnessed a brawl between a gang of youths and the police in front of a cinema on the city's outskirts. He intervened and, with his help, the police managed to overpower the gang. The officers were surprised that a student, of all people, had come to their aid. So, they offered him a job. "It was the beginning of his career with the Soviet intelligence service, the KGB," says journalist Mihkel Kärmas, who filmed "The Spy Inside," a documentary on the Simm case for Estonian television.

Simm kept his new job a secret from his family. The aunt, who had been persecuted under Stalin, was appalled when she found out. A short time later, her nephew was confirmed at the church in Suuri-Jaani, which he also kept from his family.

Simm quickly carved out a career for himself with the police. In 1975, he graduated with honors from the Soviet Union's Interior Ministry Academy. Likewise, he joined the Communist Party -- a necessary step, given the fact that his job involved accompanying delegations abroad and that such jobs were reserved for those considered politically reliable. His daughter was born in 1974, the result of an affair with a flight attendant. Today, she works as a computer specialist with Europol, the European police authority.

Part 2: Changing Times and (Apparently) Allegiances

When the Soviet Union began to decline, Simm was a colonel and had already received 44 awards, including all three of the medals awarded for exemplary behavior. But his old world no longer existed. When Estonia, a former Soviet republic, became independent in 1991, the KGB had to abandon its headquarters in Tallinn and sever all official ties with Simm.

All of a sudden, Simm became a champion of Estonian independence. When communist hardliners attacked the parliament building and the seat of government on the Toompea hill in central Tallinn in May 1990, Simm took it upon himself to organize their defense. Thereafter, he was celebrated as a hero -- and rumors that he had secretly help the Russians slip out soon faded away.

At this point, Simm went back to advancing his career. He became chief of police in Harju County, which includes Tallinn, he supervised the withdrawal or the Red Army, and he secured the removal of Soviet nuclear warheads. In 1994, he was promoted to head the Baltic republic's national police force. But hardly six months had passed before Simm was dismissed on charges of corruption, which he vehemently denied. He had been offered a lower-level position, but he turned it down and retired, instead.

Re-Recruitment into the KGB's Successor

In July 1995, after his relationship with his girlfriend -- 20 years his junior -- fell apart, Simm made a spontaneous trip to Tunisia. This, at least, was the reason he would later provide. While there, according to Simm, an old acquaintance from his KGB days approached him among the souks of the medina, and said: "It's me, Valentin."

Valery Zentsov -- code name "Valentin" -- was born in Berlin in 1946. Like Simm, he attended university in Tallinn and began his career with the KGB at an early age. Although he officially went into retirement in Russia in 1991, the classified NATO report states that he was involved during this period in building up a network of agents in the Baltic states.

Simm claims that he resisted Zentsov's initial efforts to recruit him. But, he says these days, he had just been fired and felt useless. "Don't worry about it," Zentsov reportedly replied -- before using the threat of exposing Simm's KGB past to put pressure on him. Four beers later, Simm relented, insisting that he be given the rank of colonel again should he return to service. From then on, he was an agent with the SVR, the Russian foreign intelligence agency and one of the KGB's successor agencies.

Getting Back into the Spying Game

That's what Simm claims, at least. But NATO investigators think it's also possible that he never stopped being an agent, and that he remained in Estonia as a "sleeper" to prepare for his subsequent career.

Shortly after his return from Tunisia -- and without any apparent forewarning -- Simm was summoned to Estonia's Defense Ministry. There, he was given the surprise appointment of director of the analysis division. Part of the job involved nurturing contacts with the European Union and NATO and preparing his country to join the Western defense alliance.

At the same time, he was secretly turning over to the Russians everything he came across, in the form of either photocopies or photographs of documents. Zentsov was giving him precise instructions. For instance, Simm was told to place the film rolls into empty drinking cartons -- either red or orange -- crumple them up as if they were trash and throw them away in park garbage cans. Each of these dead drops was used only once. Likewise, the agent and his Russian handler met 16 times, in 10 different countries.

It was also at this time that Simm reportedly offered to provide information to the Bundesnachrichtendienst (BND), Germany's foreign intelligence agency, and became one of its sources. He kept the BND up-to-date on the activities of Russians and criminal organizations in the Baltic states -- and was paid handsomely for the information.

Part 3: A New Handler

In July 2001, Simm married Heete, a former Soviet police officer, who had also carved out an astonishing post-Cold War career for herself and was the head of the police department's legal division. She often accompanied him on his trips abroad. During a meeting in Helsinki in November 2001, Zentsov said his goodbyes. He was retiring, and Simm's new handler would be a man named Antonio Amurett de Jesus Graf.

This was the handler's false Portuguese identity. His real name was Sergey Jakovlev, and he was an SVR officer not registered with any embassy. NATO believes that Jakovlev managed an entire network of Russian agents in the Baltics. Simm and Jakovlev first met at a train station on the outskirts of Tallinn. Simm was carrying a bag over his left shoulder -- a sign that the coast was clear.

Simm's relationship with his new handler was cool, but professional. Simm received the standard agent's salary of about €1,000 ($1,320) a month, plus a €200 subsidy for his health care. Jakovlev also outfitted him with a digital camera, a laptop, USB flash drives and a pill container with a false bottom for hiding memory cards. Simm photographed, copied and stored thousands of documents. He delivered his material at 14 meetings throughout Europe, except in Great Britain ("too many cameras"), Norway ("too expensive") and Germany ("too many police contacts").

Before each meeting, Simm had to send a numerical code from a public, card-operated pay phone to Jakovlev's pager. The code consisted of his identification number, 242, and the number 55, which indicated that the meeting could take place as agreed. Then he was supposed to wait for Jakovlev to approach him. If there was a problem, Simm was supposed to enter the number 77. But there were never any problems.

Intelligence Coups

Estonia became a member of NATO on March 29, 2004. Simm set up the National Security Authority, a department in Estonia's Defense Ministry. In his new position, he decided who would have access to which documents. Likewise, he was responsible for managing the protection of classified documents, the system for secure data transmission with NATO and the EU, and background security checks of officials.

Simm's Russian contacts were particularly interested in encryption technology, and he delivered so much information on this subject that NATO would later conclude in its classified report that Simm's activities made the alliance "more vulnerable to cyber threats and attacks" because "our weak points are now well-known by our adversaries." The three-week wave of cyberattacks on Estonia in 2007, which practically shut the country down, offered alarming evidence of the severity of the threat.

At the time, most of Simm's official duties involved searching for potential spies. He was asked to find answers to up to 60 questions about candidates, including ones related to their hobbies and possible weaknesses for cars, women and alcohol.

The NATO report cites as "particularly worrisome" Simm's participation in the annual security conferences at the alliance's military headquarters in Mons, Belgium, as well as in two counterespionage conferences, in 2006 and 2007.

At the conference held in the Dutch town of Brunssum in 2006, a CD containing the names of all known and suspected Russian NATO spies, as well as detailed information on double agents, was distributed to attendees. The CD "landed directly on Putin's desk" and "caused quite a stir" in Moscow, Jakovlev says, clearly in praise of the master spy. For the coup, Simm received a €5,000 bonus and was reportedly promoted to major general.

Part 4: Busted

According to the classified NATO report, this act of treason has damaged the alliance severely and indefinitely. A short time later, though, Western counterespionage officials grew suspicious of Simm. Exactly why this happened is unclear. The investigations, in which both the BND and the FBI participated, began on May 26, 2008 under the code name "White Knight." Simm, who was at this time an adviser to Estonia's defense minister, was placed under surveillance.

On Sept. 16, 2008, in a blatant violation of security regulations, Simm's handler called him on his cell phone. He had never established contact so openly. During the call, Jakovlev cancelled a scheduled meeting. "I'm sick," he said during the conversation, which was being recorded by the KaPo, Estonia's security police.

Three days later, the noose tightened around Simm. For days, he had been under constant surveillance. On this particular afternoon, he and his wife drove to the Röömu ("pleasure") shopping center in Keila, a small city near their row house in Saue, outside Tallinn, to buy cake for his stepmother. He was arrested while walking back to his car. An ambulance had been parked around the corner in case Simm violently resisted arrest. But he didn't.

In Simm's country home, police found his spying equipment: stacks of classified documents, two pistols, two rifles and pieces of paper with instructions from Jakovlev, complete with the latter's DNA. Jakovlev, for his part, had disappeared without a trace, and it was later rumored that he had defected to the United States.

Sentencing

On Feb. 25, 2009, Simm was sentenced to over 12 years in prison. He was also ordered to pay damages roughly equivalent to €1.3 million ($1.7 million) and refund the government about €85,000 in salary payments.

Several houses and pieces of property were seized as collateral, including half of his country house, his share of the row house in Saue, a dozen watercolors and oil paintings, and a collection of 44 coins.

A year before his arrest, Simm had donated a candelabra to the church in his birthplace of Suuri-Jaani. The gift did not bring him any luck. Even the hope of spending his golden years as a retired general in Russia proved to be an illusion. At their last meeting, Jakovlev had informed him that his rank and the medals never existed -- and that he was nothing but a paid traitor.