http://www.amazon.com/Broker-Trader-Lawyer-Spy-Corporate/dp/B006G7ZONE

Broker, Trader, Lawyer, Spy: The Secret World of Corporate Espionage

By Eamon Javers

ANOTHER FIRM THAT shies away from publicity sits at the pinnacle of London’s corporate spies: Hakluyt and Company. This intelligence firm specializes in dealing with the global corporate elite—CEOs of multinational corporations and their boards of directors. Hakluyt cultivates a tony, upper-crust image derived from the days when English gentlemen sipped tea served from silver platters and divvied up the world’s resources over dinner. The company has a butler, a former Gurkha,* who greets visitors at the door, and meetings are sometimes held alongside a crackling fireplace.

In 1995, Mike Reynolds and Christopher James—both veterans of the British intelligence agency MI6—combined forces to start the firm. Reynolds had served British intelligence in Berlin during the cold war, and James was a veteran of the British special forces as well as the intelligence agency. James—who has been described by a friend as “hale, hearty, and well met”—hit the London cocktail party circuit in the mid-1990s looking for connections to help launch his firm. He already had plenty of experience in the corporate world. As a spy for MI6, James headed the section of the agency in charge of liaisons with British companies. And now his contacts were about to get even better. At a cocktail party, he was introduced to Sir William Purves, then the group chairman of the global bank HSBC Holding, and a pillar of the City, London’s financial district.

Tapping into Purves’s Rolodex, James came to know almost everyone important in the industry, and put together the Hakluyt Foundation, an advisory board of glittering corporate names. In time, a stint at the Hakluyt Foundation became known as an exit station for captains of British industry entering their retirement years. It soon included luminaries such as Sir Fitzroy Maclean,* who many thought was Ian Fleming’s inspiration for the fictional spy James Bond; and Baroness Smith, who was married to the Labour Party leader John Smith. Also serving on the foundation was Sir Peter Holmes, a former chairman of Shell. Such contacts put Hakluyt in touch with the boards of directors of scores of multinational companies. All this was good for business.

To name their firm, James and Reynolds reached deep into British history, choosing as a namesake Richard Hakluyt, an author who specialized in navigation and exploration in the late sixteenth and early seventeenth centuries. Hakluyt was more than just a mild man of letters. He was by turns a savvy businessman, persuasive government lobbyist, and daring undercover spy—a perfect role model for the international corporate spies of today.

Hired by the explorer Sir Walter Raleigh, Hakluyt produced propaganda papers on the glory and fortunes to be made in America, hoping to persuade Queen Elizabeth I to support Raleigh’s expeditions there. During a stint in Paris as a secretary to the British ambassador, Hakluyt was asked to covertly gather information about French and Spanish activities, and their intentions and capabilities in the New World. For all this, Hakluyt was well compensated by his benefactors, accumulating a small fortune by the time he died in 1616.

Today, Hakluyt and Company’s Web site, www.hakluyt.co.uk, includes none of the traditional marketing boilerplate that other firms post on the Internet. The site has only the firm’s logo and contact information, which convey a subtle message of discretion. But despite the firm’s secretive, upper-crust image, its executives have to hustle for clients just like everyone else.

In the summer of 2001, Christopher James made a rare mistake, approaching Enron—then one of America’s leading companies—with a business proposition. James’s sales effort would prove embarrassing for Hakluyt on several levels. First, this well-connected spy appears not to have known that Enron was only a few months from collapse. Second, the man Hakluyt approached, Jeff Skilling, was about to become a symbol of corporate bad behavior. At this time, Skilling was a few weeks away from leaving the company. Worst of all, Hakluyt’s sales pitch to Enron became public knowledge after the U.S. Federal Energy Regulatory Commission made public 200,000 of Enron’s internal e-mails from 1999 through 2002.

Buried within that mountain of communication was a letter of July 8, 2001, from Hakluyt’s Christopher James to Enron’s Jeff Skilling. A few months earlier, the two men had been introduced by a longtime oil industry executive, Phil Carroll, then the CEO of the giant engineering firm Flour Corporation.* Carroll was a perfect point of contact: he was a former CEO of Shell Oil, and he lived in the same apartment building in Houston as Enron’s chairman, Ken Lay. Carroll, Lay, and their wives regularly dined together, sharing meals where the talk was more social than business. Now, James was following up with Lay’s man, Skilling, hoping to win Enron as a high-paying client:

Dear Mr. Skilling,

Your office has asked me to outline Hakluyt’s services…. I would say simply this; Hakluyt is what you make of it—it places an unparalleled private intelligence network at the personal disposal of senior commercial figures.

…Although we work for divisional directors on tactical issues, we have found our most rewarding work in personal dealings with CEOs who wish—for whatever reason—to have a confidential agency at their own disposal. It was this, which prompted Phil Carroll to write to you about us in April…. We look at people and the issues, which often drive them to make the decisions or act as they do. All our work is unattributable.3

The work is unattributable, that is, until the e-mails are revealed in a high-profile, years-long legal investigation.

In another e-mail, James told Skilling that Hakluyt had already done some low-level work for Enron, and he hinted that it was looking for a much bigger piece of Enron’s spying business. Enron had connections to former CIA officers, and wasn’t afraid to deploy their talents on its own behalf. Since Enron was using American CIA veterans operating out of London for its flights over European power plants, James may already have been aware of the extent of Enron’s interest in the spy game.

Hakluyt was already developing a reputation as a rough customer in the global economy. Earlier that year, the Sunday Times of London had broken an embarrassing story: Hakluyt had hired a German agent to spy on the environmental group Greenpeace. The plan had all the hallmarks of spy fiction, but it was real. Also, the spies didn’t work for queen and country battling evil empires, they worked for the oil companies Shell and British Petroleum, and they battled environmentalists.

The Sunday Times laid out the details. In 1996, Hakluyt’s cofounder Mike Reynolds had hired a German spy, Manfred Schlickenrieder. With his shoulder-length hair and impeccable liberal credentials, Schlickenrieder was a natural infiltration agent. He’d once been a member of the German communist party, and he was a voracious reader of Marxist literature. Schlickenrieder had a documentary film company, Gruppe 2, that was based in Munich; and he was well-known in European activist circles for his work on sympathetic documentaries about leftist groups. He had already spent years on an unfinished documentary about the Red Army Faction, a left-wing German terrorist organization. Apparently, no one on the political left asked why Schlickenrieder’s documentaries never seemed to get finished and never seemed to appear on television.

Schlickenrieder billed heavily for his services, submitting one invoice to Hakluyt in June 1997 for more than 6,000 pounds, with the heading “Greenpeace research.” The money upgraded his lifestyle: Schlickenrieder drove a BMW, not generally the car of choice among communist activists.

At the time, the oil companies were concerned about firebombing at gas stations in Germany, which they suspected were masterminded by left-wing activists. They also worried about a protest by Greenpeace at the British Petroleum (BP) Stena Dee oil rig off the Shetland Islands. Reynolds told Schlickenrieder that he wanted to know what Greenpeace was doing to prepare for an expected lawsuit from the oil companies. Hakluyt also wanted inside information on the location of the ship Greenpeace, which the group often used for elaborate and embarrassing publicity stunts against companies.

Hakluyt gave Schlickenrieder the code name “Camus,” after the author of The Stranger. Using his cover as a documentary filmmaker, Schlickenrieder approached environmentalist groups and liberal activists, and tried to glean whatever information he could.

Greenpeace was snookered. Speaking to a reporter for the Sunday Times after the affair had come to light, the communications director of Greenpeace Germany said, “The bastard was good, I have to admit. He got information about our planner Arctic Frontier campaign to focus on the climate change issue and the responsibility of BP. BP knew everything. They were not taken by surprise.” The spokesman added, “Manfred filmed and interviewed all the time, but now we realize we never saw anything.”

That was surprising enough. But Schlickenrieder had one other revelation left. After his cover was blown, another detail came to light. All the time that Schlickenrieder had been a paid spy for Hakluyt working for BP and Shell, he was also in the service of the German government. Schlickenrieder worked for the BND, the German counterpart of the CIA, which paid him the equivalent of more than 3,000 pounds per month in expenses, noted the Times.

So the corporate spy was also a government spy, and he was paid by both sides at the same time. It was the ultimate nexus between government intelligence and corporate spying.