Selling Enigma Secrets
In the early 1930s, Schmidt was an employee at the German Armed Forces' cryptographic headquarters, the Cipher Office. Shortly after the military version of the Enigma machine was introduced, he contacted French intelligence and offered to supply information about the new machine. His offer was accepted by Captain Gustave Bertrand of French Intelligence, and he received from the French the codename Asché, and was assigned a contact, the French agent codenamed Rex.
For the next several years, until he left his position in Germany, he met with French agents at various European cities and supplied them copies of the Enigma machine's instruction manual, operating procedures, and lists of key settings. Even with this information, however, French Intelligence was unable to break messages encrypted on the Enigma. Nor were the British cryptologists whom Bertrand contacted able to make any headway.
In December 1932, Bertrand shared intelligence obtained from Asché with the Polish General Staff's Cipher Bureau (Biuro Szyfrów). Mathematician-cryptologist Marian Rejewski had already set up a system of equations describing the operation of the then new German Army Enigma rotor-wirings. The key-settings lists provided by Schmidt helped fill in enough of the unknowns in Rejewski's formulae, allowing him to speedily solve the equations and recover the wirings. That accomplished, the Poles were henceforth able to read Enigma traffic for nearly seven years to the outbreak of World War II as well as for a time into the War, while operating in conjunction with French intelligence in France. In a two-week January 1938 trial, they solved and read about 3/4 of all German Wehrmacht — Army — Enigma intercepts: a remarkable result, considering that parts of the raw intercepts were garbled or incomplete due to interference .
After the battle of France, the French agent who had been Schmidt's case officer, a German citizen named Stallmann who went by the name "Rodolphe Lemoine" and used the codename "Rex," was arrested by the German Gestapo and betrayed Schmidt as a French spy. Schmidt was arrested on April 1, 1943, and in September 1943 his daughter was called on to identify his body; her account (as recounted in Sebag-Montefiore's book) suggests that Schmidt may have committed suicide.
Read more about this topic: Hans-Thilo Schmidt
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