The head of the Pond was Col. John V. Grombach, a radio producer, businessman and ex-Olympic boxer who kept a small black poodle under his desk. He attended West Point, but didn’t graduate with his class because he had too many demerits, according to a U.S. Army document. His nickname was “Frenchy,” because his father was a Frenchman, who worked in the French Consulate in New Orleans.
The War Department had tapped Grombach to create the secret intelligence branch in 1942 as a foundation for a permanent spy service. Grombach said the main objectives were security and secrecy, unlike the OSS, which he said had been infiltrated by allies and subversives and whose personnel had a “penchant for personal publicity.” It was first known as the Special Service Branch, then as the Special Service Section and finally as the Coverage and Indoctrination Branch.
To the few even aware of its existence, the intelligence network was known by its arcane name, the Pond. Its leaders referred to the G-2 military intelligence agency as the “Lake,” the CIA, which was formed later, was the “Bay,” and the State Department was the “Zoo.” Grombach’s organization engaged in cryptography, political espionage and covert operations. It had clandestine officers in Budapest, London, Lisbon, Madrid, Stockholm, Bombay, Istanbul and elsewhere.
Grombach directed his far-flung operations from an office at the Steinway Hall building in New York, where he worked under the cover of a public relations consultant for Philips. His combative character had earned him a reputation as an opportunist who would “cut the throat of anyone standing in his way,” according to a document in his Army intelligence dossier.
In defining the Pond’s role, Grombach maintained that the covert network sought indirect intelligence from people holding regular jobs in both hostile countries and allied nations — not unlike the Russian spies uncovered in June in the U.S. while living in suburbia and working at newspapers or universities.
The Pond, he wrote in a declassified document put in the National Archives, had a mission “to collect important secret intelligence via many international companies, societies, religious organizations and business and professional men who were willing to cooperate with the U.S. but who would not work with the OSS because it was necessarily integrated with British and French Intelligence and infiltrated by Communists and Russians.”
On April 15, 1953, Grombach wrote that the idea behind his network was to use “observers” who would build long-term relationships and produce far more valuable information than spies who bought secrets. “Information was to be rarely, if ever, bought, and there were to be no paid professional operators; as it later turned out some of the personnel not only paid their own expenses but actually advanced money for the organization’s purposes.”
The CIA, for its part, didn’t think much of the Pond. It concluded that the organization was uncooperative, especially since the outfit refused to divulge its sources, complicating efforts to evaluate their reports. In an August 1952 letter giving notice that the CIA intended to terminate the contract, agency chief Gen. Walter Bedell Smith wrote that “our analysis of the reports provided by this organization has convinced us that its unevaluated product is not worth the cost.” It took until 1955 to completely unwind the relationship.
Mark Stout, a former intelligence officer and historian for the International Spy Museum in Washington, analyzed the newly released papers and said it isn’t clear how important the Pond was to U.S. intelligence-gathering as a whole. “But they were making some real contributions,” he said.
Matthew Aid, an intelligence historian and author of “The Secret Sentry: The Untold History of the National Security Agency” who has reviewed some of the collection, said there was no evidence the Pond’s reports made their way to decision-makers. “I’m still not convinced that Grombach’s organization was a worthwhile endeavor in World War II and even less so when it went off the books,” he said.
What it may have lacked in quality and influence, however, the Pond certainly made up with chutzpah.
One of the outfit’s most unusual informers was a French serial killer named Marcel Petiot, Grombach wrote in a 1980 book.
The Secret Intelligence Branch, as he referred to the Pond, began receiving reports from Petiot during the war. He was a physician in Paris who regularly treated refugees, businessmen and Gestapo agents, but he also had a predilection for killing mostly wealthy Jews and burning their bodies in a basement furnace in his soundproofed house. He was convicted of 26 murders and guillotined in 1946.
Nevertheless, Grombach considered him a valuable informer because of his contacts.
One cable discovered among the newly released papers appears to confirm the Pond was tracking Petiot’s whereabouts. In the undated memo, the writer says Petiot was drawn by a Gestapo agent “into a trap to be arrested by the Germans.” Petiot was briefly arrested in 1943 by the Gestapo.
Such sources were often feeding their reports to top operatives — often businessmen or members of opposition groups. But there were also journalists in the spy ring.
Ruth Fischer, code-named “Alice Miller,” was considered a key Pond agent for eight years, working under her cover as a correspondent, including for the North American Newspaper Alliance. She had been a leader of Germany’s prewar Communist Party and was valuable to the Pond in the early years of the Cold War, pooling intelligence from Stalinists, Marxists and socialists in Europe, Africa and China, according to the newly released documents.
But it was the help from businesses in wartime that was essential to penetrating Axis territories.
The Philips companies, including their U.S. division, gave the Pond money, contacts, radio technology and supported Grombach’s business cover in New York. Philips spokesman Arent Jan Hesselink said the company had business contacts with Grombach between 1937 and 1970. He added that they could not “rule out that there was contact between Philips and Grombach with the intention of furthering central U.S. intelligence during the war.”
The Pond laid the groundwork and devised a detailed postwar plan to integrate its activities into the U.S. Rubber Co.’s business operations in 93 countries. It is unknown if the plan was ever carried out. The Pond also worked with the American Express Co., Remington Rand, Inc. and Chase National Bank, according to documents at the National Archives.
American Express spokeswoman Caitlin Lowie said a search of company archives revealed no evidence of a relationship with Grombach’s organization. Representatives of the other companies or their successors did not respond to requests for comment.
The Pond directed its resources for domestic political ends, as well.
In the 1950s, Grombach began furnishing names to McCarthy on supposed security risks in the U.S. intelligence community. By then, the Pond was a CIA contractor, existing as a quasi-private company, and the agency’s leadership was enraged by Grombach’s actions. It wasn’t long before the Pond’s contract was terminated and the organization largely ceased to exist.