Coast Guard Enlisted Forces 1923-1934

12000:

10000:

8000. 4

6000

4000. iY

2000.

@ Enlisted

1923 1924 1925 1926 1927 1928 1934

Figure 8. Doubling the Enlisted Force.

Data Source: Treasury Department, Annual Reports of the Secretary of the Treasury on
The State of the Finances for the Fiscal Years 1923-1934 (Washington, DC: GPO).

OTHER MEASURES TO EVEN THE SCORE

In addition to enlargement through vessel acquisition and recruitment, the Coast Guard
and the Congress looked for other ways to even the score between the Coast Guard and
the rum fleet. The greatest impediment to effective enforcement of Prohibition at sea was
the internationally recognized three-mile limit, limiting Coast Guard jurisdiction to those
activities occurring within three nautical miles from shore.*? Recognizing this problem
early on, the Congress began negotiations with Great Britain to develop a treaty which
would give the Coast Guard authority to board and seize British-flagged vessels outside of
three miles if there existed reasonable cause. The treaty, signed with Great Britain on
23 January 1924," allowed the Coast Guard to enforce U.S. law within a nominal 12 nau-
tical miles from America’s coastlines."!

39 Willoughby, 31-32,

4° Robert L. Jones, The Eighteenth Amendment and Our Foreign Relations (New York: Thomas
Y. Crowell Company, Publishers, 1933), 117

4! ‘The “12-mile treaty” actually extended U.S. Custom’s waters to the distance a foreign vessel
could steam from the U.S. coast in one hour. This distance, generally considered to be 12 miles,
actually depended on the maximum speed of the vessel in question. If the vessel could make more
than 12 knots, the distance was greater. If the vessel's maximum speed was slower than 12 knots,
the distance was shorter. Willoughby, 40.


Long Island coasts,” giving the Coast Guard DBK in the area most notorious for rum run-
ning since the beginning of Prohibition.'?> The Loening OL-S seaplane, built specifically
for the Coast Guard, extended the Coast Guard’s view of the battlefield to a range of 415
miles, and operated at a speed of 75 miles per hour.!?6

The rust ARMANE consreueTeD Fon
Sue U.S. Coast GuaRD Apt SERVICE
Bes Me, dohvernd Cet 1926

feller wth Rob pa
lens sped,

Figure 12. The Coast Guard’s First Airplane

Source: U.S. Coast Guard, “Airplane,” photograph
(Coast Guard Historian's Office, Washington, DC: 1926).

By 1927 the Coast Guard had five seaplanes in its inventory, operating them from
three different air stations along the Northeast Atlantic coastline.!”” To respond to
the increased smuggling activities off the Florida Coast, in 1928 an additional tem-
porary air station was set up at Fort Lauderdale.'?* With the Headquarters Intelli-
gence Section stressing the need to obtain photographs of suspected rum runners at

!5Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1926 (Washington, DC: GPO, 1926), 391.

2°Hugh Garling, “The United States Coast Guard: Part II,” Nautical Magazine 247, no. 2 (Feb-
ruary 1992): 105.

!27The five seaplanes included three Loening amphibian planes and two Voight UO type aircraft.
In addition to the air station at the Coast Guard patrol base in Gloucester, Massachusetts, an auxil-
iary air station was set up at Ten Pound Island, off Gloucester, and a second primary air station was
established at Cape May, New Jersey. Treasury Department, Annual Report of the Secretary of the
Treasury on The State of the Finances for the Fiscal Year Ended June 30 1927 (Washington, DC:
GPO, 1927), 161.

18Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1928 (Washington, DC: GPO, 1928), 128.

35


LCDR Gorman remarked that “[t]he resulting confusion to this group of rum ships was
more than all the efforts of the destroyer force and the other units combined have been able
to effect in months.”

The use of HFDF proved very profitable for the Coast Guard. This was true not only at
sea, but also in locating and shutting down illicit amateur radio stations ashore.°> With the
cooperation and consent of the Department of Justice.’ in the summer of 1930 portable
direction finders were used to locate and close down six unlicensed stations in the New York
area.”> This success continued with several more illicit stations along the Northeast U.S.
Coast located and put out of operation in 1931.%° So helpful was the use of portable direction
finders in identifying shore-based rum runners that by 1931, determining “the location of ...
hidden station{s] [was] now but a matter of hours, where before it was one of months.””

HFDF was also used by the Navy to assist the Coast Guard in locating vessels of the
rum fleet. Rum runners would frequently request bearings from Naval stations to maintain
their positions at sea while waiting for the arrival of contact boats. The Coast Guard capi-
talized on this unintended COMINT gold mine by requesting that the Navy take bearings
on all suspected rum-running vessels and transmit them, in code, to the nearest Coast
Guard cutter.°® With the Navy’s assistance, this proved extremely beneficial to the Coast
Guard's enforcement effort.

As the Rum War entered its second decade, the rum syndicates increasingly focused
their efforts on the Southeast U.S. and the Gulf of Mexico. Consolidated Exporters set up
an office in Belize, British Honduras in 1930 and began sending mother ships to infiltrate
U.S. supply lines through its Southern approaches.” By this time Consolidated’s hold on

* Kahn, 806.

93 ‘To find illicit radio stations ashore, Coast Guard personnel placed portable direction finders in
traveling bag monitors and took cross bearings from different locations in the area where the station
was located. This allowed the Coast Guard to pin-point locations accurately and quickly, so the sta-
tions could be raided before illicit radio operators had time to sanitize their operations. Frank M.
Meals, LT, USCG, letter to Commandant, U.S. Coast Guard, subject: “Use of Monitor by Radio
Electricians W. B. Dawson and H. M. Anthony in the Location of Rummy Radio Station at 25 Hull
Avenue, Grant City, Staten Island,” 16 March 1931.

°4 The Coast Guard itself had no general police authority ashore and was not authorized to make
investigations, inspections, raids, or seizures. This was done by agents from the Department of Jus-
tice with the Coast Guard supplying the necessary HFDF equipment and acting as “technical advi-
sors.” Commandant, U.S. Coast Guard, letter to Commander, Coast Guard Intelligence Unit, New
York, subject: “Intelligence Duty: Instructions,” 5 December 1930, 2.

°5 Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Unlicensed
Radio Stations Used to Direct Smuggling Activities,” 24 October 1930.

°° Frank M. Meals, LT, USCG, letter to Commandant, U.S. Coast Guard, subject: “Raiding of
Group 6 Radio Station, 98 Austin Street, New Bedford, Mass,” 22 March 1931.

°7 Frank M. Meals, 16 March 1931.

°8 Willoughby, 105-106.

°° U.S. Consulate at Belize, British Honduras, confidential memorandum for Colonial Secretary,
no subject, | August 1932.

31


“Fourth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Ninth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Picket Boats.” Photograph. Circa 1925. Coast Guard Historian's Office, Washing-
ton, DC.

“Prevalence of Blacks with Reference to Phases of Moon for the Year Ending January
31, 1930.” Chart. N.d. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

“Proposed Re-organization Chart of U.S. Coast Guard at, and Outside Washington,
DC." Chart. Washington, DC: USCG, 31 July 1925. Records of the Coast Guard Intel-
ligence Division 1922-1932, Record Group 26, Entry 297; National Archives Build-
ing, Washington, DC.

“Second District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Seventh District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Six-Bitters.” Photograph. Circa 1925. Coast Guard Historian’s Office, Washington,
DC.

“Sixth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Speedboat.” Photograph. Circa 1925. Coast Guard Historian’s Office, Washington,
be.

“Submarines, Possible Use for Smuggling.” Photograph. 11 June 1924. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

“Tenth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

The Coast Guard at War: Intelligence XII. N.p., | January 1949.

“Third District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Thirteenth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Histo-
rian’s Office, Washington, DC.

87


[t]he officers in charge of any branch or unit of the Coast Guard, Customs, Prohibi-
tion, and Narcotic services, when stationed in the same city, shall meet in conference
the first and third Monday of every month. The purpose of these conferences will be
the interchange between the officers of all information and evidence relating to viola-
tions of the laws coming within their respective jurisdictions, in order that the same
may be investigated and prosecuted in an effective and expeditious manner.'*”

Liaison with other agencies often went beyond operational sharing of information
related to rum running. The Coast Guard also tapped the resources of appropriate
government agencies to better train its own forces in the methods of collecting and
interpreting intelligence. In January 1925, the Director of the Justice Department's
Bureau of Investigation '** agreed to allow Coast Guard intelligence officers to attend the
Bureau's three-week training program in New York.!>? In reciprocation, the Coast Guard
provided the Bureau intelligence related to its operations, obtained incidentally in the
enforcement of Prohibition." The Coast Guard also relied heavily on the War

Department for instructing Coast Guard officers in the ways of cryptanalysis.'°!

ALL-SOURCE INTELLIGENCE SUPPORT TO THE FLEET

The Coast Guard’s creative use of different, yet complementary, intelligence disci-
plines represented an all-source effort to gain DBK and maintain the edge in information
superiority as a means of magnifying the effectiveness of material assets in fighting the
Rum War at Sea. It was a challenging task for the Headquarters Intelligence Section to
correctly identify the Coast Guard’s intelligence needs, collect the required data, process
the information into usable intelligence, analyze and interpret the results, deliver the intel-

'57Commandant, U.S. Coast Guard, letter to All Divisions, Section Bases and Districts, no sub-
ject, 27 July 1928.

'S8In the 1920s, the FBI was known simply as the Bureau of Investigation, under the Justice
Department. Sometime after Prohibition, the Agency became better known as the “Federal” Bureau
of Investigation. J. Edgar Hoover, Director, Bureau of Investigation, letter to CAPT Charles S. Root,
USCG, no subject, 26 June 1930.

‘J, Edgar Hoover, Director, Bureau of Investigation, letter to CDR Charles S. Root, USCG, no
subject, 21 January 1925.

'@In 1930 the Coast Guard received a report of a white-slavery ring operating between the U.S.,
Cuba, and Panama. Unsuspecting girls in the U.S. and Cuba were lured to Panama on contracts as
artists. Once in country, the girls were levied with huge debts incurred by their passage to Panama
and placed in bars, cafes, and brothels where they were given a chance to “work off the debt.”
Charles S. Root, CDR, USCG, Intelligence Officer, letter to J. Edgar Hoover, Director, Bureau of
Investigation, no subject, 21 June 1930.

‘!Charles $. Root, memorandum of Telephone Conversation Between CDR Root, Coast Guard
Headquarters and MAJ Friedman, War Department.



COAST GUARD ENLARGEMENT THROUGH VESSEL
ACQUISITION AND RECRUITMENT

One of the last things Commandant Reynolds did before turning over the reins of the
Coast Guard to Rear Admiral (RADM) Billard in 1924 was to respond to a request from the
Secretary of the Treasury to assess the problem of additional personnel and vessels the Coast
Guard would need to prevent the illegal importation of alcohol by sea. Updating his May
1923 request for an additional $5 million, in October of the same year Commandant Rey-
nolds issued a new assessment pre ig the Coast Guard would be able to suppress liquor
smuggling with a one-time appropriation of $19,099,500 to be used as follows: $10,800,000
for the purchase of 20 cruising cutters; $50,000 for purchasing two vessels from the Navy;
$7,612,500 to build 203 cabin cruiser-type motor boats; and $637,000 for the purchase of 91
smaller motorboats.° Additionally, Commandant Reynolds asked for an annual increase in
Coast Guard appropriations of $8,472,458 to provide for the cost of operating and maintain-
ing the new vessels, adding and maintaining 3,535 new billets to the Coast Guard, and
increasing the administrative force at Coast Guard Headquarters.° This brought the total
request for additional Coast Guard funds for fiscal year 1924 to $27,571,958.

The Secretary of the Treasury responded by recommending an increase in the Coast
Guard's 1924 budget of $28,500,000.’ After due consideration, in April 1924 Congress
appropriated an additional $13,850,622, approximately half of the requested increase.§ The
reality of a limited budget forced the Coast Guard and the Congress to look for alternatives
to the planned construction of new cutters. As a result, President Calvin Coolidge directed
the U.S. Navy to make 20 World War I-vintage destroyers available to the Coast Guard for
Prohibition enforcement.? Of the $13,850,622 allocated for the Coast Guard’s expansion,
$12,194,900 was for conditioning and equipping the destroyers for suitable Coast Guard use
and for constructing 223 “cabin cruiser” type motor boats and 100 smaller motor vessels.
The remaining $1,655,722 was for additional “operating expenses.”!° Congress also autho-
rized additional personnel for the Coast Guard, to be paid for with existing funds.

Immediately after assuming office as the Coast Guard’s new Commandant in April
1924, RADM Billard began a relentless war against the rum runners.'! In his first written
address to the Coast Guard, Commandant Billard rallied the Service behind the enforce-
ment of Prohibition, reminding all hands that “[nJeither the old Revenue-Cutter Service

5 Commandant, U.S. Coast Guard, memorandum for Assistant Secretary Moss, subject: “Addi-
tional Personnel and Material Needed by the Coast Guard to Prevent Illegal Importations,”
12 October 1923.

© Commandant, U.S. Coast Guard, 12 October 1923.

7 Willoughby, 40.

§ Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1924 (Washington, DC: GPO, 1924), 324.

° ‘John A. Tilley, Coast Guard Vessels of the Prohibition Era, unpublished research paper, n.d.

'© Treasury Department, Annual Report for 1924, 324.

'! U.S. Coast Guard, Biography for Prohibition Era Commandants William E. Reynolds, Fredrick
G. Billard, and Harry G, Hamlet, no subject, n.d. Coast Guard Historian’s Office, Washington, DC.


The Origins of NSA. Fort George G. Meade, MD: Center for Cryptologic History.
Nad.

“Central America/Caribbean,” ANT Limited, ISP Homepage. URL: <http:/Avww.ant.co.
uk/isp/maps/cam.himl>. Accessed 2 June 1998.

Central Intelligence Agency. A Consumer's Guide to Intelligence. Langley, VA: CIA Pub-
lic Affairs Office, 1995. PAS 95-00010

Chiswell, B. M., CAPT, USCG. Letter to J. M. Doran, Commissioner of Prohibition. No
subject. 24 February 1928. Records of the Coast Guard Intelligence Div
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Collector of Customs, U.S. Customs Service. Letter to the Secretary of the Treasury. No
subject. 24 January 1923. Coast Guard Historian’s Office, Washington, DC.

Commandant, U.S. Coast Guard. Memorandum for General Lord, Director of the Budget.
Subject: “Availability of the Coast Guard to Enforce Prohibition Law.” 3 May 1923.
Coast Guard Historian’s Office, Washington, DC.

Memorandum for Assistant Secretary Moss. Subject: “Additional Personnel and
Material Needed by the Coast Guard to Prevent Illegal Importations.” 12 October
1923. Coast Guard Historian’s Office, Washington, DC.

Letter to All Coast Guard District Superintendents. Subject: “Intelligence Circulars.”
21 February 1924. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Chief Signal Officer, U.S. Army. Subject: “Cipher Devices.” 12 April 1924.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to the Officers in Charge and Personnel of Coast Guard Stations. No subject. 25
April 1924. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to All Force, Division and Section Base Commanders and District Superinten-
dents. Subject: “Giving Aid and Comfort to and Commu ing Intelligence to
Smugglers.” 7 July 1924. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Wayne B. Wheeler, General Counsel, the Anti-Saloon League of America.
No subject. 25 July 1924. Coast Guard Historian’s Office, Washington, DC.

Letter to Chief, U.S. Army Air Service. Subject: “Request for Aerial Photographs.” 29

July 1924. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.


smuggling. They would then “caravan” the liquor to points west and north for further dis-
tribution inland.*!

Occasionally rum runners resorted to drastic means to interrupt the flow of Coast
Guard communications, in an attempt to foil interdiction efforts. In February 1929, a
Coast Guard submarine cable was maliciously cut, presumably by rum runner devel-
opment that had the effect of disrupting Coast Guard communications in the Virginia area
for several days.”

Rum runners were also not above calling different Coast Guard stations, identifying
themselves as official telephone operators from Washington, DC, and informing Coast-
guardsmen of supposed rum-running activity in certain locations, requesting immediate
dispatch of Coast Guard vessels to investigate. Once the local Coast Guard cutter was
underway, it is presumed the rum runners then effected rendezvous in areas away from the
decoy location given over the phone.

Occasionally, rum runners attempted to disrupt the Coast Guard’s anti-smuggling
effort through the use of disinformation. In July 1929, anonymous civilian sources
reported the captain of a certain Coast Guard patrol boat was known to routinely loot
liquor seized by his crew.“ After thorough investigation, the patrol boat skipper was
exonerated and the matter closed. While the unfounded accusations in this case did not
yield the anticipated results—removal of the officer from command—they did serve to
divert time and effort away from the enforcement effort to complete the investigation.

Deception techniques afforded some level of success for the rum runners, but successes
were often short-lived as the Coast Guard became aware of “tricks of the trade” with each
passing year of the Rum War. It is doubtful that any attempts by the rum runners to deceive
the Coast Guard resulted in the attainment of even a minute level of information superiority
for the rum runners for any notable period. The rum syndicates’ efforts to gain DBK were.
further hampered by the Coast Guard’s own use of OPSEC and COMSEC measures to pro-
tect Coast Guard operations and intelligence collection methods.

3 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, no subject, 23 March 1929,

® Commandant, U.S. Coast Guard, letter to J. Edgar Hoover, Director, Bureau of Investigation,
no subject, 25 February 1929.

3 R. W. Dempwolf, letter to CDR Charles $. Root, USCG, no subject, 15 November 1926,

¥ William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Confidential Communication from Commander Klinger.” 20 July 1929.

50


deny the Coast Guard use of its new HFDF equipment. Blacks also assumed periods of
radio silence from time to time to confuse Coast Guard radio operators.!®

Other more covert means of protecting communications included the use of hydro-
planes to relay messages from ships of the rum fleet to shore stations and vice-versa.!”
Additionally, as late as 1925, carrier pigeons were used to communicate with certain rum
schooners.'* A rum syndicate in the New England area kept large numbers of carrier
pigeons at its headquarters, releasing several of them each time shipments of liquor
arrived off the New England coast.!? Although it is unknown how successful this means
of communication was for the syndicate, a carrier pigeon was captured by the Coast
Guard off the coast of Massachusetts in December 1925, returning home after apparently
completing its mis: ion.” Blacks were also known to use the centuries-old method of
communicating via messages in a bottle, albeit in the days of rum running the bottles
were dropped in the vicinity of rum ships by hydroplanes for immediate recovery. In
January 1925, the Coast Guard Cutter Seminole beat the rum schooner Alma R to a bottle
dropped by a seaplane in plain sight of the Cutter. Inside was the rendezvous location and
time for the Alma R to meet certain contact boats that would have been sent out to meet
her had the Coast Guard not intercepted the message.”

Probably the most ingenious method of disguising illicit communications was the
practice of tying rendezvous locations at sea to certain songs played by a radio station on
the New England coast.”> Depending on which song was played at a prearranged time
daily, rendezvous locations would shift between several predetermined bearings from a
local landmark off the coast. Because each rendezvous location was exactly 28 miles from
shore and all rendezvous were effected at dusk, all that was needed by the contact boats
was the course to steer which was given by the different songs played on the radio.74

'5 “Broadcasting in the blind” refers to transmitting a radio message without waiting for
acknowledgment or receipt from the receiving station. It is used to conceal the identity and where-
abouts of the receiver. C. E. Reeves, 16 January 1928.

‘© RJ. Iverson, letter to Chief of Division of Foreign Control, no subject, 14 March 1928.

‘7 Commander, Section Base Eight, 28 December 1925. Also see, W. V. E. Jacobs, Commander,
New York Division, letter to Commandant, U.S. Coast Guard, subject: “Smuggling in Vicinity of
Base 1,” 27 April 1925.

'8 Charles S. Root, CDR, USCG, Intelligence Officer, letter to George A. Parker, Federal Prohi-
bition Administrator, no subject, 31 December 1925.

'9 George A. Parker, Federal Prohibition Administrator, letter to Commandant, U.S. Coast
Guard, no subject, 5 December 1925.

© Charles S. Root, 31 December 1925.

2! W. V. E. Jacobs, Commander, New York Division, letter to Commandant, U.S. Coast Guard,
subject: “Joseph McDonald and Seaplane Attempting Contact with British Schooner ALMA R.”

21 January 1925.

» W.V.E. Jacobs, 21 January 1925.

> William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Further Suggestions Regarding Black Situation in Area “B”;" 13 September 1929.

* William J. Wheeler, 13 September 1929.

48


rum runners will utilize every thread of knowledge in an effort to destroy their
enemy.'°

This statement, made by an unidentified newspaper reporter at about the time the Coast
Guard effectively disbanded Rum Row, was in reaction to the reporter's attempts to leam
about the secret communications systems in development for use by the Coast Guard. Cor-
rectly identifying the benefits in protecting its own communications in early 1924, the Coast
Guard made attempts to devise a suitable code for anti-smuggling operations.'” Proposed
codes were submitted to the War Department’s Chief Signal Officer, Major William F.
Friedman, for comment before being employed by operational Coast Guard forces. Unfortu-
nately, none of the Coast Guard-developed codes provided a “degree of security [s
ficient to warrant [their] use for communication which must remain secret for a period of six
or more hours.”!® As a result, the Coast Guard asked the War Department for permission to
use the Army’s M-94 cipher devices to provide operational Coast Guard forces a sufficient
level of protection in secret communications.!° Permission was granted ° and in late Spring
1924, the Coast Guard placed its first order for 150 M-94 cipher devices and 1,000 cipher
disks.?! They arrived in June and were subsequently installed onboard designated Coast
Guard cutters and at various shore stations for use in passing operational Coast Guard radio
traffic.” To ensure the codes remained secret, the Commandant strictly prohibited the use of
codes or ciphers and plain text in the same dispatch.” This was owing to the fact that much
of the Coast Guard’s own success in solving enemy codes was due to poor security mea-
sures on the part of the rum syndicates in mixing old codes with new ones and occasionally
combining plain text with code when sending radio traffic.”

This same trial-and-error scenario was repeated in 1927 by the Prohibition Bureau as it
began attempts at developing its own code for secure communications. This time the
codes were submitted to the Coast Guard’s Intelligence Section for comment and returned

16 »Radio Set is Devised to Aid Coast Guard Battle Rum Fleet,” Unidentified Newspaper, n.d.

‘7 Alvin C. Voris, LTC, USA Signal Corps, letter to Commandant, U.S. Coast Guard, subject:
“Code System,” 14 June 1924.

'S Alvin C. Voris, 14 June 1924.

19 LC. Andrews, Assistant Secretary of the Treasury, letter to Secretary of War, no subject,

27 March 1924.

20 Secretary of War, letter to Secretary of the Treasury, no subject, 8 April 1924.

21 The M-94 cipher devices acquired from the Army were marked “C.G.” on the outer face and
given serial numbers from | to 150. Cipher disks were expendable discs placed inside the M-94 to
encrypt plain text communications. Commandant, U.S. Coast Guard, letter to Chief Signal Officer,
U.S. Army, subject: “Cipher Devices,” 12 April 1924. The first shipment of 1,000 cipher discs cost
the Coast Guard a total of $62.40, $60 for the discs and $2.40 for shipping charges. U.S. Army Sig-
nal Corps, shipping ticket for 1000 cipher discs delivered to CDR Charles S. Root, USCG, 24 April
1924

2 U.S, Army Signal Corps, 24 April 1924.

2 Commandant, U.S. Coast Guard, letter to Commanders, Southern Division, Northern Divi-
sion, and Gulf Division, subject: “Intelligence,” 23 March 1925.

24 Willoughby, 113.

54


the end product, usable intelligence on enemy vessel locations, available to those
who needed it for the prosecution of smuggling.*?

The Coast Guard continued to protect its communications and operational plans
through the end of Prohibition. By denying the enemy useful information through the
strict use of OPSEC and COMSEC measures, the Coast Guard prevented the rum syndi-
cates from benefiting enough from their own intelligence collection efforts to pose a dan-
gerous or unified threat to the Coast Guard’s monopoly on information dominance in the
Rum War. With OPSEC and COMSEC guarding its flanks, the Coast Guard remained
dominant on the information battlefield as the Prohibition era came to a close.

* §. S. Yeandle, Aide to Commandant, U.S. Coast Guard, letter to Commandant, U.S. Coast
Guard, subject: “Radio, Telephone, and Telegraphic Reports on Smuggling Operations,” 6 August
1924,


While this did not happen often, it did occur. In December 1925, while on patrol off the
coast of New London, Connecticut, the destroyer Cassin intercepted a plain text radio mes-
sage saying “BOOTLEGGER DO NOT COME IN TONIGHT NOT SAFE.”? The captain
of Cassin reported the sending set sounded much like those used on Coast Guard patrol
boats, although when the message was intercepted the only other vessel in sight was another
destroyer. As Cassin drew closer to New London, a Coast Guard six-bitter was observed
entering New London from sea. The matter was investigated but there is no record address-
ing whether the six-bitter was involved.>

Another HUMINT method the rum runners employed was to impersonate Coast Guard
intelligence officers and contact legitimate Coastguardsmen asking for information on
Coast Guard operational plans.’ Although it is unknown how often this tactic succeeded,
in at least one case apparently related to rum running, a person was prosecuted by the
U.S. Attorney for violation of the statute against pretending to be an Officer of the United
States Government.’ Other clandestine HUMINT collection involved the use of “double
agents” working as informants for the Coast Guard, while at the same time smuggling
liquor of their own ashore and using their relationship with the Coast Guard to protect
themselves and others engaged in the illegal rum trade.

Little is known about the rum syndicates’ attempts or successes in breaking Coast
Guard codes and ciphers. As the codes used by the Coast Guard were developed by the
War Department to provide secure military communications,’ it is doubtful the rum syndi-
cates had much success in this endeavor, if it was even attempted. To compensate, how-
ever, rum runners did use “other means” to intercept Coast Guard communications. In the
summer of 1924 the Coast Guard learned that telephone lines at two New York City area
Coast Guard stations had been tampered with. Suspected rum runners had scraped the
insulation off of telephone lines and attached listening devices to collect COMINT infor-
mation.® Subsequently, the Officers-in-Charge at Coast Guard stations were armed to pro-
tect themselves and government property from unauthorized intrusion. Evidence of
another instance of phone tapping appeared in the summer of 1930, when a Coast Guard

? PF Roach, Commanding Officer, CASSIN, letter to Commander, Destroyer Force, subject
“Intercepted Radio Message,” 12 December 1925.

+ PF, Roach, 12 December 1925.

+ HLF, Schoenborn, LCDR, USCG, letter to Assistant U.S. Attorney Bennet Sanderson, no sub-
ject, 6 January 1926.

> Bennet Sanderson, Assistant U.S. Attorney, letter to CDR Charles S. Root, USCG, no subject,
4 January 1926.

© William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Notes Taken From Mr. Owens of Foreign Control Section, Prohibition Service,
March 28, 1928,” 29 March 1928.

7 The Coast Guard purchased M-94 Cipher Devices from the War Department to encrypt its
own operational communications. L. C, Andrews, Assistant Secretary of the Treasury, letter to Sec-
retary of War, no subject, 27 March 1924.

5” W. J. Massey, letter to Commander, New York Division, subject: “Telephone Line Tampering
with,” | May 1924,

46


Source Intelligence © as well as intelligence sharing between the Coast Guard and other
federal agencies bolstered and sustained interdiction efforts.

Coincident with the promulgation of the Doctrine for Prevention of Smuggling in July
1924, Commandant Billard tasked the Intelligence Section at Headquarters with “fur-
nish[ing] all information obtainable bearing on the mission to Coast Guard Division
Commanders, Destroyer Force Commanders, and District Superintendents,” including
“movements of rum ships, court decisions, interpretations of law, and other matters bear-
ing on the mission.”’ This early mandate to support operations with intelligence was
indicative of the importance the Coast Guard placed on intelligence support to the anti-
smuggling fleet.

In 1924, the Intelligence Section was only a one-man operation, run by Lieutenant
Commander (LCDR) Charles S. Root. Reporting directly to the Commandant, LCDR Root
served as a “clearing house for any and all information dealing with blacks and their move-
ments.”* In the early days of Prohibition, LCDR Root received information from patrolling
Coast Guard cutters on the name, tonnage, homeport, nationality, vessel type, and owner-
ship of each vessel frequenting Rum Row.’ He maintained a wallchart at Headquarters with
the name and noontime position of all suspected rum runners and he disseminated this
information back to the fleet via “Intelligence Circulars,” a precursor to the suspect vessel
lookout lists maintained by the Coast Guard today in its war on drugs.'° The immensity of
the job soon exhausted LCDR Root’s abilities to keep up with the need for timely, accurate
intelligence and the extensive liaison duties required of his office. In early 1925, LCDR
Root asked for and was given clerical assistance to help with the “large amount of secret
correspondence with practically [sic] all Departments of [the U.S.] Government and with
several foreign governments.”!' To further elevate the Intelligence Section’s status as a
valuable aid to the interdiction effort, in the summer of 1925, the Intelligence Section was
designated Section “C” and placed directly under the Chief of Operations at Coast Guard
Headquarters.'? Following this pattern of growth, now Commander (CDR) Root was given

© Open Source Intelligence is defined as “[i]nformation that is publicly available (for example,
any member of the public could lawfully obtain information by request or observation), as well as
other unclassified information that has limited public distribution or access. Open-source informa-
tion also includes any information that may be used in an unclassified context without compromis-
ing national security or intelligence sources or methods. If the information is not publicly available,
certain legal requirements relating to collection, retention, and dissemination may apply.” CIA,
Consumer's Guide, 57.

7 U.S. Coast Guard, Doctrine for Prevention of Smuggling, 9.

8 Harold Waters, Smugglers of Spirits: Prohibition and the Coast Guard Patrol (New York:
Hastings House, Publishers, 1971), 63.

° Waters, Smugglers of Spirits, 63.

10 Waters, Smugglers of Spirits, 63.

'! Charles S. Root, CDR, USCG, Intelligence Officer, letter to Chief Clerk, Coast Guard Head-
subject: “Clerical Assistance,” 3 February 1925.

!2 U.S. Coast Guard, “Proposed Re-organization Chart of U.S. Coast Guard at, and Outside
Washington, DC,” chart (Washington, DC: USCG, 31 July 1925).

18


sea,'?? in 1929 the Coast Guard Air Service searched a total area of 945,275 square
miles and identified 5,113 vessels.'*° Based on the photographs obtained by both
Coast Guard air and surface assets, an “identification book of blacks” was developed
for the use of patrol forces in sorting out known rum runners from the myriad ves-
sels operating near America’s shores.'*! Lists of photographs needed to keep the
book current were routinely disseminated to Coast Guard units capable of obtaining
the necessary pictures.'*? This ensured the book remained a viable aid for Coast
Guard units on patrol at sea.

Open-Source Intelligence

Placing its finger on the nation’s pulse in response to Prohibition, early in 1924 the
Coast Guard organized a campaign to obtain as much open-source information as possi-
ble concerning the plans and intentions of would-be rum runners. In May 1924, after
learning of illegal activity in Gloucester, Massachusetts, LCDR Root contacted Miss
Martha N. Brooks, Alderman for the City of Gloucester, and asked for her help to piece
“together scraps of disconnected information—every available source,” in hopes of glean-
ing information valuable to the Coast Guard’s anti-smuggling effort.'*> Miss Brooks
responded by ordering the Coast Guard Intelligence Section a subscription to the Glouc-
ester Daily Times, at the City’s expense.'** Showing remarkable presence of mind, Miss
Brooks added that the Chief of Police kept a confidential list of 28 suspected rum-running
vessels which he would be glad to share with any bona fide Coast Guard person dis-
patched to collect it.!*> This face-to-face meeting was necessary owing to the fact that

Miss Brooks appreciated “the difficulties of enemy spies and secret agents.”!°

The use of newspapers to keep abreast of developments in the rum trade became a sta-
ple in the Coast Guard’s arsenal of tools for acquiring information dominance. By August
1924, the Intelligence Section had subscriptions to “several ... papers published in the
Maritime Provinces and in New England Coast cities.”'*’ The information gleaned from
these subscriptions was incorporated into Intelligence Circulars and disseminated to the
fleet to assist in identifying suspect vessels for boarding.'** One of the most valuable

!2Charles S. Root, 9 August 1928, encl (1), 1.

Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1929 (Washington, DC: GPO, 1929), 128.

'31Commander, Eastern Division, letter to All Units, Eastern Division, subject: “Black Informa-
tion,” 24 December 1929.

'2Commander, Eastern Division, 24 December 1929.

'8Charles S. Root, CDR, USCG, Intelligence Officer, letter to Martha N. Brooks, Alderman,
City of Gloucester, Massachusetts, no subject, 26 May 1924.

'MMartha N, Brooks, Alderman, City of Gloucester, Massachusetts, letter to CDR Charles S.
Root, USCG, no subject, 6 June 1924.

'SMartha N. Brooks, 6 June 1924.

SeMartha N. Brooks, 6 June 1924.

‘Commandant, U.S. Coast Guard, letter to CDR W. H. Munter, subject: “Intelligence Informa-
tion,” 23 August 1924.

'8Commandant, U.S. Coast Guard, 23 August 1924.

36


Blake, Eugene Jr, Commander, Eastern Division. Letter to Commandant, U.S. Coast
Guard. Subj “Rum Runners’ Radio Communication; Investigation of.” 17 Febru-
ary 1928. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Communications; Radio.” 20
February 1928. Records of the Coast Guard Intelligence n 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Brooks, Martha N., Alderman, City of Gloucester, Massachusetts. Letter to CDR Charles
5 s ct. 6 June 1924. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Brown, F. W., Commanding Officer, MOJAVE. Letter to Commandant, U.S. Coast Guard.
Subject: “Intercepted Code.” 26 October 1926. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Browning, Robert M. Jr., Ph.D., Historian at U.S. Coast Guard Headquarters. Interview
by author, 4 November 1997.

Camden, B. H. Letter to Commandant, U.S. Coast Guard. Subject: “Boarding Duty.” 3
August 1927. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

“Canada,” Central Intelligence Agency Fact Book. URL: <http:// www.odci. gov/ cia/pub-
lications/factbook/country-frame.html>. Accessed 18 June 1998.

Candlee, Hal M. The Hanging at Bahia Mar. Fort Lauderdale: Wake-Book House, 1985.

Canney, Donald L. Rum War: The U.S. Coast Guard and Prohibition. Washington, DC:
U.S. Coast Guard, 1990.

U.S. Coast Guard and Revenue Cutters, 1790-1935. Washington, DC: U.S. Coast
Guard, 1995.

Carmine, G. C., Commander, New York Division. Letter to Commandant, U.S. Coast
Guard. Subject: “Listening in for Black Traffic.” 1 February 1926. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Carse, Robert. Rum Row. New York: Rinehart & Company, Inc., 1959.

Center for Cryptologic History Pamphlet. Pioneers in U.S. Cryptology. Fort George G.
Meade, MD: Center for Cryptologic History. N.d.

Rare Books in the National Cryptologic Museum. Fort George G. Meade, MD: Center for
Cryptologic History. N.d.


Author’s biography. . 91
Biography of ADM Robert E. Kramek. .......... 2.2.00 0 000 cece cee eee eee ee 92
List of Figures

Figure 1. Rum-Running Speedboat . . . 3
Figure 2. Destroyers Converted for Coast Guard Use ...... 2.02... 0.00e ee eee 9
Figure 3. The 25 Destroyers... 0.0.66. 0c eee e ee cee cence eee eee nese 10
Figure 4. 75-Foot Patrol Boats (Six-Bitlers) «2.0.0.6... 6s ce eee eee eee eee ee 11
Figure 5. 125-Foot Steel Hull Patrol Boats ......... 0.60.0. ee eee ee eee eeee 11
Figwré 6: Coast Giiaid Picket Boats scicccciesiscaicacswesiees sccicwesives sasises 12
Figure 7. Officer and Civilian Enlargement .........-...-.202+2202020e20005 13
Figote:8:. Doubling the Pnlisted HORG: ocomcmuaenecmamens UnwenKws Usene 14
Figure 9. Consolidated Exports’ Communications System .......-..-.-----+-+- 28
Figure 10. “X Type” Portable HF Radio Direction Finder...............-.--.- 30
Figure 11. Suspected Rum-Running Submarines. ............2-2-220---20-5- 34
Figure 12. The Coast Guard’s First Airplane ..........2.2.202- 220202020000 35
Figure 13. Black Locations Based on Intelligence... ..........2.2-220-0-00005 42
Figure 14. Smuggling Fluctuations with Moon Phases . . 43
Figure 15. Naval Operations Chart Modified to Encode Vessel Positions. ....... . 56


Letter to All Divisions, Section Bases and Districts. No subject. 27 July 1928.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to J. Edgar Hoover, Director, Bureau of Investigation. No subject. 25 February
1929. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Gulf Division. Subject: “Cruising of Patrol Boats.” 23 March
1929. Records of the Coast Guard Intelligence Di mn 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, New York Division. Subject: “Black Operations.” 24 July 1930.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Gulf Division. Subject: “Unlicensed Radio Stations Used to
Direct Smuggling Activities.” 24 October 1930. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commander, Destroyer Force. IOF-11802. Subject: “Radio-Intelligence:
Interception of Rum-Runners’ Radio Traffic.” 14 November 1930. Coast Guard His-
torian’s Office, Washington, DC.

Letter to Commander, New York Division. Subject: “Field Intelligence Units: Estab-
lishment and Operation of.” 1 December 1930. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commander, Coast Guard Intelligence Unit, New York. Subject: “Intelli-
gence Duty: Instructions.” 5 December 1930. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commander, New York Division. Subject: “Radio-Intelligence; High-Fre-
quency Receivers.” 11 December 1930. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commander, Gulf Division. Subject: “Radio-Intelligence; Operation of
Unlicensed High-Frequency Radio Transmitter in Gulf Division.” 16 December 1930.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Coast Guard Intelligence Unit, New York. Subject: “Intelli-
gence Duty; Instructions, Amendment of.” 7 January 1931. Records of the Coast

71


Letter to All Commissioned Officers of the Coast Guard. Subject: “Publicity in Con-
nection with Law Enforcement.” 21 August 1924. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to CDR W. H. Munter. Subject: “Intelligence Information.” 23 August 1924.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commanders, Southern Division, Northern Division, and Gulf Division.
Subject: “Intelligence.” 23 March 1925. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Eastern Div., N.Y. Div., Norfolk Div., Desfor, N.L.P.A., Bases 1, 2, 3, 4, 5, 7,
8, 9, 18. No subject. 12 October 1925. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Letter to CDR W. H. Munter and LCDR G. E. Wilcox. Subject: “Board to Recom-
mend Improvement in Communication System.” 5 April 1926. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commander, Eastern Division. Subject: “Interception of Code Messages.”
17 November 1926. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, New London Patrol Area. Subject: “Painting of Cruising Cut-
ters and Other Vessels Engaged in Law-Enforcement Operations.” 26 November
1926. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commanders of Section Bases, Squadrons and Divisions of Offshore Patrol
Forces, and Offi in Charge of other Patrol Boat Groups. Subject: “Confidential
Reports of Operations.” 26 January 1928. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commander, California Division. Subject: “Califomia Division; Communi-
cations.” 24 April 1928. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to CDR Charles S. Root, USCG, Intelligence Officer. No subject. 5 June 1928.

Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

70


Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Statement Regarding Anti-Smuggling Operations. No subject. N.d. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Commander, Base Four. Letter to Commandant, U.S. Coast Guard. Subject: “Flares, Use
of by Rum Runners from Planes.” 2 November 1932. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Commander, Destroyer Division Two. Letter to Commandant, U.S. Coast Guard. Subject:
“Concentration Charts.” 14 August 1932. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Commander, Eastern Division. Letter to All Units, Eastern Division. Subject: “Black
Information.” 24 December 1929. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
DC.

Commander, Norfolk Division. Letter to Commandant, U.S. Coast Guard. Subject:
“Information Regarding Rum Running via Delaware Bay and the New Jersey Coast.”
8 December 1932. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Commander, Section Base Six. Letter to CAPT C. S. Root, USCG. No subject. 9 April
1930. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Commander, Section Base Eight. Letter to Commandant, U.S. Coast Guard. Subject:
“Hydroplane Operating in the Vicinity of Chincoteague, VA.” 28 December 1925.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Commissioner of Customs, Bureau of Customs. Letter to Commandant, U.S. Coast
Guard. No subject. 10 February 1931. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Corbett, Scott, and Manuel Zora. The Sea Fox: The Adventures of Cape Cod’s Most Col-
orful Rumrunner, New York: Thomas Y. Crowell Company, 1958.

De Lorme, Roland L. “Liquor Smuggling in Alaska, 1867-1899.” Pacific Northwest
Quarterly 66 (Summer 1975): 145-152.

73


office eventually to entirely suppress commercial smuggling by sea upon the Pacific
Coast.”””

Back on the East Coast, rum runners had developed codes and ciphers of their own.
One group was known to mix profanity in with their codes to make decryption more diffi-
cult.®° Still another resorted to the use of cover terms—seemingly innocent words with
cryptic meanings-to make their conversations as benign as possible.*! All up and down
the East Coast, rum runners had found the value in using unlicensed amateur radio sta-
tions to broadcast operating instructions and customer orders to vessels operating off-
shore. Among the Coast Guard’s first efforts to counter this tactic was to have informers
operate illicit radio stations of their own in attempts to lure shore-based rum runners into
divulging their operating frequencies and other information.” When this did not yield the
expected results, the Coast Guard sent a patrol boat outfitted with “special high frequency
receivers” to the coast off Plymouth, Massachusetts “ostensibly to find certain ‘dead
spots,’” but actually to clandestinely sample illicit radio traffic emanating from the Ply-
mouth area.*?

These crude attempts at locating illicit radio stations, although relatively unsuccessful,
were the preamble to the Coast Guard’s widespread use of high frequency radio direction
finders (HFDF) to locate both illegal radio stations ashore and rum-running vessels at sea.
One of the first experiments in using HFDF to interrupt rum-running operations was con-
ducted aboard the 75-foot patrol boat, CG-210. With the Assistant Communications
Officer at Headquarters, LT Frank M. Meals, assigned as her captain, CG-210 was “fitted
out ostensibly to conduct certain experimental radio work, but actually the purpose was to
intercept and record certain radio traffic for the purpose of detecting and identifying per-
sons, ships, and stations engaged in illicit operations.”** CG-210 had onboard “a battery
of high-frequency receivers [and] direction finders.”*> including the prototype “X Type”
direction finder shown below.*>

7 Ralph R. Read, Supervising Agent, letter to Commissioner of Prohibition, no subject,
12 September 1928.

80 F, J. Gorman, LCDR, USCG, Intelligence Officer, leter to Commander, Intelligence Unit,
New York, subject: “Radio Intelligence, Group 2; Code Seized,” 28 January 1931.

8! R. J, Iverson, letter to LTJG Clifford D. Feak, USCG, no subject, 16 February 1928.

®2 Eugene Blake Jr., Commander, Eastern Division, letter to Commandant, U.S. Coast Guard,
subject: “Communications; Radio,” 20 February 1928.

83 Eugene Blake Jr., Commander, Eastern Division, letter to Commandant, U.S. Coast Guard,
subject: “Rum Runners’ Radio Communication; Investigation of.” 17 February 1928.

4 Willoughby, 109.

85 Kahn, 806.

8° ©, T, Solt, Radio Electrician, USCG, letter to Communication Officer, subject: “Type X High
Frequency Radio Direction Finding Equipment, Development and Test of,” 4 December 1930.

29


With the 12-mile treaty now in force, the Coast Guard had enough room to deploy its
newly equipped sailing fleet with some chance of success against the rum runners. To guide
the new anti-smuggling armada, in July 1924 Commandant Billard promulgated a formal
Doctrine for Prevention of Smuggling covering all Coast Guard forces involved in Prohibition
enforcement.” The Commandant designated all destroyers, six-bitters, and picket boats as
“special service craft,” to be used exclusively in the prevention of smuggling."* He then set up
a “Destroyer Force,” assigning Commander W. H. Munter as its Commander and homeported
the destroyers in New London, Connecticut.“ The Destroyer Force was organized as a squad-
ron, with five divisions of four vessels each. The Commandant also established Section Bases
along the coasts, assigning various numbers of patrol boats and picket boats to each.” The
general plan to suppress smuggling was for the destroyers to patrol assigned areas at sea,
making first contact with suspected rum runners. The destroyers would then trail the suspects,
handing them off to patrol boats within 20 or 30 miles of shore.“° The patrol boats would be
responsible for trailing the suspect vessels until they either entered the 12-mile limit and
could be stopped and searched, or tumed back to sea. While the destroyers and patrol boats
patrolled offshore, the picket boats would patrol the shoreline to discourage the landing of
alcohol on the beach.’”

To ensure the rum-runners had no doubts about the Coast Guard’s authority to enforce the
Prohibition laws at sea, Commandant Billard also prescribed the use of force in accordance
with Section 2765 of the Revised Statutes as follows:

Whenever any vessel liable to seizure or examination does not bring-to, on
being instructed to do so, or on being chased by any cutter or boat which had
displayed the pendant and ensign prescribed for vessels in the Coast Guard,
the master of such cutter or boat may fire at or into such vessel which does
not bring-to, after such pendant and ensign has been hoisted, and a gun has
been fired by such cutter or boat as a signal and such master, and all persons
acting by or under his direction, shall be indemnified from any penalties or
actions for damages for so doing. If any person is killed or wounded by such
firing, and the master is prosecuted or arrested therefor, he shall be forthwith
admitted to bail.*

Finally, to make Coast Guard vessels less conspicuous to the rum runners, Commandant
Billard issued a directive that “all ... vessels engaged in law enforcement operations be
painted Navy gray outside instead of [the traditional Coast Guard] white as at present, in
order that they may not be so readily distinguishable, both day and night, when at sea."

#2 U.S. Coast Guard, Doctrine for Prevention of Smuggling (Washington, DC: USCG, 15 July
1924), 1.

43-U.S. Coast Guard, Doctrine for Prevention of Smuggling, 2.

+4 Willoughby, 40.

4 U.S. Coast Guard, Doctrine for Prevention of Smuggling, 6.

46 SS. Yeandle, compilation, 8.

47 US, Coast Guard, Doctrine for Prevention of Smuggling, 9-13.

48 U.S, Coast Guard, Doctrine for Prevention of Smuggling, 13-14.

15


Human Resources Intelligence

HUMINT was the launching pad for the Coast Guard’s quest for information superiority
or DBK. In addition to early HUMINT collection on the vessels of Rum Row, the Coast
Guard also ventured to foreign shores in its pursuit of DBK. In 1924, the Coast Guard Cut-
ter Zampa was sent to anchor just off the French island of St. Pierre, eight miles south of
Newfoundland. Here, Zampa came to rest “only a few hundred yards out from the water-
front, right in the middle of the rum armada,” and commenced her intelligence-gathering
work.” The crew of the Tampa recorded each vessel’s name, rig, dimensions, draft, ton-
nage, probable speed, flag, and port of registry. Tampa then transmitted the collected
HUMINT information via radio to Coast Guard Headquarters where it was analyzed by the
Intelligence Section.” Other overt Coast Guard HUMINT collection included sending an
engineering officer to Nova Scotia to study types of rum boats under construction and their
propulsion systems.” The information obtained from various studies of rum-running ves-
sels was used to prepare designs for Coast Guard patrol and picket boats.” This was accom-
plished by a “board of officers who studied the problem from every conceivable angle, and
determined the types of boats most suited for efficient operation to combat illegal importa-
tions of liquor”! The information obtained from overt Coast Guard HUMINT collection
was analyzed and fused with other information at Coast Guard Headquarters, processed into
usable intelligence, then disseminated to the fleet via Intelligence Circulars.

In addition to overt HUMINT collection, the Coast Guard also convinced the Prohibi-
tion Bureau to employ several undercover agents and assign them to penetrate major
smuggling bases in St. Pierre, Nova Scotia, Nassau, Bimini, Havana, and Curacao.?>
Contact was maintained with these agents using locked dispatch cases forwarded via the
State Department in embassy pouches.?° Through the years espionage~’ proved
extremely fruitful for the Coast Guard’s anti-smuggling effort. Ina March 1931 memo-
randum for the Coast Guard Chief of Staff, the new Headquarters Intelligence Officer,”*

20 Waters, Smugglers of Spirits, 27-32.

21 Waters, Smugglers of Spirits, 32.

2 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Recommendation that an Officer be Sent to Nova Scotia to Study Types of Rum
Boats,” 31 August 1929.

23 §. S. Yeandle, Aide to Commandant, USCG, compilation of Coast Guard Efforts to Combat
Rum-Running, no subject, n.d., 10-13.

24 §. S. Yeandle, compilation, 10.

25 Charles S. Root, 9 August 1928, 4. Also see Waters, Smugglers of Spirits, 63.

26 Charles S. Root, 9 August 1928, 4.

27 Espionage is defined as “the clandestine collection of information (raw data) about the plans,
intentions and activities of foreign governments, organizations and persons by human or technical
means.” Espionage, Intelligence, and International Policy, vol I, ed. Mr. Kenneth M. Absher (Wash-
ington, DC: Joint Military Intelligence College, 1998), 3.

*8 The incumbent Intelligence Officer, Captain Charles S. Root, died while on active duty and in
1930, LCDR F. J. Gorman was assigned as his replacement.

21


Chapter 3
INTELLIGENCE AS A FORCE MULTIPLIER

Five and twenty ponies,

Trotting through the dark—
Brandy for the Parson,

“Baccy for the Clerk;

Laces for a lady, letters for a spy,
And watch the wall my darling,
While the Gentlemen go by.

A Smuggler’s Song, Kipling

ORGANIZATION AND EARLY OPERATION OF THE COAST GUARD
INTELLIGENCE SECTION

The development of an Intelligence Section marked the turning of the tide in [the
Coast Guard’s] favor” in the Rum War.! The increase in personnel and vessels dedicated
to the enforcement effort did push the “blacks”? away from America’s shores, but was
not enough to stop smuggling. The battle for information superiority was fought by
both sides, but an understanding of the value of intelligence and the “all-source”
approach of tapping the unique abilities of each intelligence discipline allowed the
Coast Guard to support interdiction operations with well-fused intelligence. The mod-
ern-day intelligence disciplines of Human Resources Intelligence (HUMINT),> Com-
munications Intelligence (COMINT).’ Imagery Intelligence (IMINT).° and Open

' Harold Waters, “Five Flashes East,” in 80 Years of Yachting, ed. Bill Robinson (New York:
Dodd, Meade & Company, 1987), 80.

2 “Black” was a term used to distinguish rum runners of the Prohibition period. It was used
extensively by the Coast Guard, Customs Service, and the Federal Prohibition Bureau in reference
to rum running. The “black codes” was the name given to codes and ciphers used by rum runners in
their attempts to maintain communications security (COMSEC) and avoid detection by enforce-
ment officials.

3 HUMINT is defined as “[i

ntelli gence information acquired by human sources through covert
and overt collection techniques.” Central Intelligence Agency, A Consumer's Guide to Intelligence
(Langley, VA: CIA Public Affairs Office, 1995), 54.

+ COMINT is defined as “[iJnformation derived from the intercept of foreign communications
by other than the intended recipients; it does not include the monitoring of foreign public media or
the intercept of communications obtained during the course of counterintelligence investigations
within the United States. COMINT includes the fields of traffic analysis, cryptanalysis, and direc-
tion finding, and is a part of Signals Intelligence (SIGINT).” CIA, Consumer's Guide, 52.

> IMINT is defined as “[t]he products of imagery and imagery interpretation processed for
intelligence use.” CIA, Consumer's Guide, 54.



Figure 10. “X Type” Portable HF Radio
Direction Finder.

Source: U.S. Coast Guard, “Type X RDF”
photograph (Coast Guard Historian's Office,
Washington, DC: circa 1930).

In September of 1930, after several unsuccessful Coast Guard appeals to bring Major
William F. Friedman*’ to active duty with that service.** the War Department released
Major Friedman for two weeks to board CG-210 and conduct code-breaking experiments
on the Coast Guard’s new “floating cryptanalytic crime-detection laboratory.” While
operating off the coast of New York, Major Friedman devised a system for breaking down
the various codes used by blacks operating in and around New York Harbor.” He then read
the decoded operating orders back to the rum ships, which had the effect of halting delivery
of all alcohol along the New York coastline for several days.”! In awe of this success,

87 William F. Friedman graduated from Comell University with a degree in genetics in 1912. He
then worked at Riverbank Laboratories, Illinois, where he met and married Elizabeth Smith. During
WWI, Friedman trained Army cryptologists at Riverbank. A fier the War, he was invited to take over
the War Department Signal Corps’ Code and Cipher Section, an offer he readily accepted. While with
the Army, Friedman coined the term “cryptanalysis,” as the science of code-breaking. In 1929, Fried-
man became the Chief of the Army’s Signal Intelligence Service. In addition to hi isting the
Coast Guard with cryptanalysis during Prohibition, Friedman is credited with breaking the Japanese
“Purple Code” during WWIL. Ladislas Farago, The Broken Seal: Operation Magic and the Secret
Road to Pearl Harbor (New York: Random House, 1967), 61-63.

88 Secretary of War, letter to Secretary of the Treasury, no subject, 9 September 1930.

* Kahn, 806.

°° Frank M. Meals, LT, USCG, letter to Commandant, U.S. Coast Guard, subject: “Major Will-
iam F. Friedman, U.S.A.; Services Rendered by,” 30 September 1930.

°! Kahn, 806.



Figure 6. Coast Guard Picket Boats.

Source: U.S. Coast Guard, “Picket Boats,”
photograph (Coast Guard Historian's Office,
Washington, DC: circa 1925).

develop, however, as in the early days of Prohibition rum runners were allowed to simply
buy back seized vessels." A new law in 1926 scuttled this practice and gave the Coast
Guard wide latitude in converting seized vessels for law enforcement work.” By the sum-
mer of 1926, sixteen former rum-running vessels were employed by the Coast Guard.” By
the end of the Rum War, over 500 seized vessels had been taken over, with 232 of them
used to enforce the Prohibition laws.*! The advantage of using seized vessels in the Rum
War was “enormously increased by [their] nondescript appearance and ... [it] spread con-
sternation in the ranks of the enemy because of their inconspicuous appearance.”

As mentioned above, before the Coast Guard assumed the main responsibility for Prohibi-
tion enforcement, total Coast Guard personnel numbered only 4,140 in 1923. With the push
to increase the service’s material assets beginning in eamest by the spring of 1924, plans to
raise the number of personnel followed suit. In May 1924, a campaign began to enlist recruits
into the Coast Guard at 28 Navy recruiting stations across the country.’ Use of the Navy’s
facilities was required as the Coast Guard had none of its own. Within the first month and a
half, 1,255 additional enlisted men were brought into the Coast Guard and sent to Navy
recruit training centers for military indoctrination. By February 1925, the Coast Guard had
acquired five recruiting stations of its own and discontinued its use of the Navy’s facilities.*°
By the end of fiscal year 1925, the Coast Guard had enlisted an additional 3,230 men over the
previous year.” The officer corps also grew, with 327 commissioned officers and 729 warrant

28 One rum runner, the tug Underwriter, was seized and bought back by the rum syndicates four
times in one year. Willoughby, 57.

2° Waters, “Five Flashes East,” in 80 Years of Yachting, 84.

%© Treasury Department, Annual Report for 1927, 160.

5! Of the over 500 seized vessels acquired by the Coast Guard, at least 196 were surveyed and
condemned, 40 were sold, 22 were transferred to other government agencies, and 232 were
employed by the Coast Guard. Willoughby, 147-148.

*? William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “General Report and Recommendations Regarding Section Bases from Charleston
to Galveston, Inclusive,” 3 July 1928, 2.

%3 Treasury Department, Annual Report for 1924, 325.

4 Treasury Department, Annual Report for 1924, 326.

35 The five Coast Guard recruiting stations were located at Baltimore, MD; Boston, MA; New
York, NY; Norfolk, VA; and Philadelphia, PA. Treasury Department, Annual Report for 1925, 419.

36 Treasury Department, Annual Report for 1925, 420.

12


Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1930. Washington, DC: GPO, 1930. 3023. Coast Guard
Historian's Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1931. Washington, DC: GPO, 1932. 3037. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1932. Washington, DC: GPO, 1932. 3049. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1934. Washington, DC: GPO, 1935. 3065. Coast Guard
Historian’s Office, Washington, DC.

Tutt, Lewis J., Deputy Prohibition Administrator, Bureau of Prohibition. Letter to Com-
mander, USCG New York Division. No subject. 9 December 1931. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Unidentified correspondent. Letter to Commandant, U.S. Coast Guard. No subject. 8 Feb-
ruary 1926. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Unidentified correspondent. Letter to Roy A. Haines, Federal Prohibition Commissioner.
No subject. 18 January 1924. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Unidentified correspondent. Memorandum for the Intelligence Division files. No subject.
N.d. Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Unidentified correspondent. Transcript of LCDR Gorman’s remarks following Admi-
ral Billard’s speech. No subject. N.d. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Unidentified correspondent. Transcript of Mr. Watson's discussi
San Francisco. No subject. 19 January 1931. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

“The United Kingdom,” Central Intelligence Agency Fact Book. URL: <http:// www.
odci.gov/cia/publications/factbook/country-frame.html>. Accessed 23 June 1998.

“The United States,” Central Intelligence Agency Fact Book. URL: <http:// www.odci.
gov/cia/publications/factbook/country-frame.html>. Accessed 9 July 1998.

85


Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commissioner of Customs, Bureau of Customs. No subject. 14 February
1931. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Gulf Division. Subject: “Radio-Intelligence; High-Frequency
Receivers; Interception of Rum-Runner’s Radio Traffic.” 14 April 1931. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commander, Gulf Division. Subject: “Contact Positions of Rum-Runners in
Gulf Area.” 15 May 1931. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Gulf Division. Subject: “Radio-Intelligence; Interception of
Rum-Runner’s Radio Traffic.” 5 June 1931. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commander, Gulf Division. Subject: “Radio-Intelligence; Interception of
Rum-Runner’s Radio Traffic.” 11 June 1931. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commander, Destroyer Force. Subject: “Radio-Intelligence; Request for
High Frequency Radio Receiver.” 2 July 1931. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Ensign L. T. Jones. Subject: “Cryptographic Literature.” 31 July 1931.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commander, New York Intelligence Unit. Subject: “Information on Broad-
casting Motor Truck by Smugglers on New Jersey Shore.” 7 August 1931. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commander, Destroyer Force. Subject: “Policy in Re-Operation of New
165-ft. Patrol Boats.” 16 December 1931. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commanding Officer CHELAN. Subject: “Instructions for Transmitting
Intercepted Messages to Headquarters by Cipher.” 14 April 1932. Records of the

2


Controlling leaks was difficult but could be managed by strict adherence to established com-
munications procedures. In addition to the frequent switching of operational codes, this
included such measures as refraining from discussing classified information over open phone
lines ** and logging the receipt and transmittal of all coded messages.TM' On infrequent occasions
when unclassified telegrams sent to Coast Guard operatives in foreign countries were inter-
cepted by moles in the offices of the wireless services entrusted to deliver them, the Coast Guard
simply changed its means of communication to avoid using the suspect wireless service.*°

Additional controls were placed on the handling of Coast Guard crypto-gear by limiting
the individuals allowed to decode operational messages arriving at Headquarters. Only
officers of the Intelligence Section, Communications Section, and the Commandant himself
were allowed to decode messages and reveal their content.*”

7| 8] 9 Jao] a] a2] 7] 8
bs G sp ep 8 |B & b i, Ng}
by £13) 24 lag &

lk
{

25| 26] e7| 28] 2c} soles | 26

Ov]

hw

BL] 32] 33] Hl 3) MB %
134 00m
122 OW 12v 008 12000 f

Figure 15. Naval Operations Chart Modified to Encode Vessel Positions.
Source: De Otte, D. F. A., Commander, California Division, letter to Commandant, U.S.
Coast Guard, subject: “Code “F"; Standard “Squared Chart” for California Division,”

29 January 1929 (Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC). Annotated by author.

*3 Charles S. Root, CDR, USCG, Intelligence Officer, letter to CAPT Randolph Ridgely, USCG,
no subject, 28 May 1930.

4 Commandant, U.S. Coast Guard, letter to Commander, Eastern Division, subject:
tion of Code Messages,” 17 November 1926.

5 Unidentified correspondent, memorandum for the Intelligence Division files, no subject, n.d.

3 R. J, Mauerman, Assistant Communication Officer, letter to Night Decode Officers, subject:
“Instructions to Night Decode Officers,” n.d.

37 R. J. Mauerman, letter to Night Decode Officers.

Intercep-

56


While many larger vessels formed the foundation of the American “rum fleet,” early
rum-running opportunists also employed smaller vessels including speedboats, some
capable of exceeding 40 knots, to outrun Coast Guard defens: -'7 Public sentiment on
Prohibition was ambivalent, as evidenced by some marine engine companies giving away
free machine guns as an incentive for would-be rum runners to purchase their engines.'* It
was a lawless and dangerous time. Liquor was smuggled into the U.S. right under the
noses of the slower enforcement vessels, and the number of smuggling vessels involved in
the rum trade was steadily increasing.'? By 1924, liquor was entering the U.S. from sea
not only via Rum Row, the Bahamas, and St. Pierre and Miquelon, but also from Canada
via the Great Lakes, from Mexico via the Pacific coastline and the Gulf of Mexico; and
from Cuba and the West Indies via the Southeast U.S.°° The U.S. was under siege by
American and foreign opportunists determined to cash in on Prohibition.?!

COAST GUARD ORGANIZATION AT THE BEGINNING OF THE RUM WAR

Although the Coast Guard would eventually become the lead U.S. agency charged
with enforcing the Prohibition laws at sea, enforcement in the first few years of Prohibi-
tion was conducted primarily by state law enforcement officials with the help of 1,500
federal agents from the Treasury Department’s newly established Bureau of Prohibition.”
From 1920 to 1923, the Coast Guard, also falling under the Treasury Department, saw the
enforcement of the Prohibition laws as an ancillary duty, subordinate to its primary mis-
sion of search and rescue. Accordingly, Prohibition was enforced only incidentally and
given no more emphasis than any other Coast Guard mission.”> But by 1923 it was clear
America had no intention of abiding by its self-imposed ban on alcohol. It was also clear
the Coast Guard would be compelled to play a leading role in the suppression of liquor
smuggling into the U.S. by sea.

As the flow of liquor continued to swell, jurisdictional issues arose between the Coast
Guard, the Customs Service, and the Federal Prohibition Bureau. The Coast Guard saw
Prohibition enforcement as a Customs Service responsibility, whereas Customs looked to

'7 Willoughby, 18.

'S Lewis J. Tutt, Deputy Prohibition Administrator, Bureau of Prohibition, letter to Commander,
USCG New York Division, no subject, 9 December 1931.

'9 Willoughby, 29.

20 Willoughby, 17.

21 One of the more famous early rum runners was Captain Bill McCoy. McCoy operated three
sailing vessels out of Nassau, Bahamas and the islands of St. Pierre and Miquelon, bringing liquor
to Rum Row where he was said to have made a fortune, He was known along Rum Row for han-
dling only good liquor and for being fair in his dealings. Through this reputation, his liquor became
known as “the real McCoy,” coining the American slang phrase meaning “genuine.” Willoughby,
18.

2 The Prohibition Era: The Roaring Twenties.

?3 Coast Guard missions in the early 1920s included the enforcement of navigation and anchor-
age laws, the safety of life and property at sea, protection of federal revenues, and the prevention of
smuggling. Willoughby, 22.



watches when able to do so.*” To further support the COMINT collection effort, watches not
dedicated solely to communications intercept were doubled at key times daily to allow sys-
tematic sampling of known black frequencies while still maintaining continuous coverage
of Coast Guard operational frequencies as required by communications instructions. As
the intercepts started pouring into Headquarters, an instruction was issued to set forth “the
method of preparing copy of intercepted radio traffic in code and cipher to facilitate its solu-
tion by the cryptanalytic unit of the Intelligence Office at Headquarters." This was neces-
sary to ensure uniformity of the reported traffic to better facilitate decryption efforts.

The proliferation of encoded and encrypted illicit radio traffic was in full flower by
1927, and the Coast Guard gained the assistance of the Prohibition Bureau in collecting
the traffic needed for successful cryptanalysis. On the California Coast alone, agents of
the Prohibition Bureau had compiled over 1,000 coded messages turned over to them by
the commercial wireless services beginning in 1924.” Relying on the expertise of the
Coast Guard’s cryptanalysis unit, the Prohibition Bureau forwarded the intercepts to
Washington for decoding.”' This relationship proved very profitable for both the Coast
Guard and the Prohibition Bureau with one exception—the time delay in having the cryp-
tanalysis done in Washington created several missed opportunities for interdiction.” To
mitigate this problem, in July 1928, the Coast Guard sent Mrs. Friedman to San Francisco
to instruct selected Prohibition agents in the means of cryptanalysis.”* At about the same
time, the rum syndicates ceased their use of wireless services in favor of direct communi-
cations between rum ships and amateur radio stations ashore.”

As the means of communication between mother ship, supplier, and customer grew
more sophisticated, so did the types of codes and ciphers used. Whereas in 1927 “only two
general systems were in use,’> changing only every six months, [by] mid-1930 practically

© Commandant, U.S. Coast Guard, letter to Commander, California Division, subject: “Califor-
nia Division; Communications,” 24 April 1928.

68 A. M. Martinson, letter to Commander, Florida East Coast Patrol Area, no subject, | May
1930.

© Commandant, U.S. Coast Guard, letter to Commanding Officer CHELAN, subject: “Instruc-
tions for Transmitting Intercepted Messages to Headquarters by Cipher,” 14 April 1932.

7 ©. A. Housel, Special Agent, letter to Ralph R. Reed, Supervising Agent, no subject,

16 December 1927.

71 C. A, Housel, 16 December 1927.

7 C. A, Housel, Special Agent, letter to Ralph R. Reed, Supervising Agent, no subject,
11 September 1928.

73 C. A, Housel, 11 September 1928.

74 C. A. Housel, 16 December 1927.

75 The main code book used by Pacific Coast rum runners in the years prior to 1928 was Bent-
ley's Complete Phrase Code with Five Letters and Five Figures, Pocket Edition. Charles S. Root,
CDR, USCG, Intelligence Officer, letter to H. J. Anslinger, no subject, 10 October 1927. $200 was
allocated for the purchase of commercial code books for the Coast Guard in 1928, to be used in
decoding enemy radio traffic. Charles S. Root, CDR, USCG, Intelligence Officer, memorandum for
Mr. Minot, no subject, 31 August 1928.

27


effective tool against the rum runner. Taken as a whole, it is evident the Coast Guard’s all-
source intelligence effort formed the backbone of its operations and successes over the
rumrunner in the 14-year Rum War at Sea.

Protecting its operations with OPSEC and COMSEC measures, the Coast Guard was
able to deny vital operational information to the enemy while ensuring the intelligence
obtained by the Coast Guard remained secret and useful to the enforcement effort. To
enhance the capabilities of other federal agencies involved in Prohibition enforcement,
the Coast Guard cultivated an extensive intelligence-sharing network that continues even
today. The resultant “pooling of resources” further enhanced the government's overall
collection posture and resulted in increased successes against the rumrunner. This inter-
agency commitment to a common goal—stopping the flow of liquor into the U.S.—was
more than a unified intelligence effort by agencies of the U.S. government with the Coast
Guard in the lead. It was one of intelligence’s finest moments where the resulting mar-
riage of operations to intelligence lasted literally until “death do us part,” and allowed the
Coast Guard and other federal agencies to achieve otherwise unattainable successes
through the end of Prohibition.

The Coast Guard’s direct, supportive, and mutually beneficial relationship of intelli-
gence to operations in the Rum War at Sea provides a valuable lesson for future conflicts
where intelligence will be looked upon as a key to obtaining and maintaining information
superiority. The need for information dominance will remain critical as the ability to
monopolize on DBK will likely be the deciding factor in future conflicts, much as it was
in the days of Prohibition. The present and future applications of lessons learned in the
Rum War are, therefore, readily apparent. Although this thesis focused on documenting
the historical record of how the Coast Guard used intelligence to its advantage in the Rum
War, the argument that an effective intelligence organization is critical to military success
is still relevant today and may become even more so in the future, as information becomes
the overriding key to both self-preservation and victory on the battlefield. This is probably
the most important lesson we can take from the Coast Guard’s efforts in the early 20th
century—to make intelligence-based information superiority available to both high-level
decisionmakers and to those on the front line.

In 1924, one officer with a vision for how intelligence could benefit the Coast Guard
began a campaign to integrate all-source intelligence into every aspect of Prohibition
enforcement. Relying on his intellect, foresight, and by keeping in focus a worthy goal,
LCDR Root orchestrated a support effort so important, it proved the difference between
winning the Rum War and just treading water for the Coast Guard. It would serve the
Intelligence Community well not to forget this past success in looking ahead as we plan
for intelligence support to conflicts yet to come. After all, we cannot know where we are
going if we do not know where we have been.


601-64

Avoid intercourse or association with rum rumors or
with persons interosted in tho neferious rum mmegling gomo,
You may bo wholly innocent, but the vory fect that you aro
Imowm to associate with such porsons is bound to injaro tho
Const Guard ond my got you into troublo. The Gust Guard
hag a wonderful reputation for intogrity and devotion to duty,
and that roputation is going to be fully maintained. I have
high hopoo that no member of the Coast Guard will ylold to
temptation in this matter, but if thero bo one, and ho is provon
guilty, ho need oxpect no morcy.. Ho will be givon tho sovorost
punishment that it is within tho powor of the Coast Guard to
impose. io heve no room for traitors in the Const Guard.

The exigencios of tho Sorvice may roquire, from time to
timo, the transfer of tho porsomol of tho stations from ono
wit te another. I went you to understand fully that the
trenpfor of any man will not bo brought ebout or prevented or
effected in ay Way by ony outside influence whatever. Attomts
may even be io to undermine your morale by suggostions that com
man hes boon transferred because he wae too zoalous in onforeing
tho lew, I om sure you are senpiblo enough to recomize any .
such talk es absolutely false, In some cases, which will be few,
I trust, a men may be rorfoming his duties at the place whore ho
is stationed with sufficient genl end efficioncy; but you havo
no right to agswno thet ss the causes In the vast majority of

_Cavos transfors will be due simply to the necessities of the
“situation as Headquarters sees it.

I am counting on the mon at the stations to ronder gonlous,
efficient, and devoted servico in ag with their splendid
treditions, A man who does his duty need feel no eppre~
honsion and will be « credit to his Servico,

This letter will bo rond aloud at a mster of ol hands
at each station,

Faithfully yours,

F. 0. BILLA

Rear Admiral, Commandant,
U. S. Coast Guard,



BIBLIOGRAPHY

80 Years of Yachting. Ed. Bill Robinson. New York: Dodd, Meade & Company, 1987.

Ahern, J. L., Commanding Officer, PORTER. Letter to Commandant, U.S. Coast Guard.
Subject: “Destruction of Confidential Papers.” 16 September 1927. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Allen, Everett S. The Black Ships: Rumrunners of Prohibition. Boston: Little, Brown and
Company, 1979.

Andrews, L. C., stant Secretary of the Treasury. Letter to Secretary of War. No sub-
ject. 27 March 1924. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Secretary of State. No subject. 17 March 1925. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Office Memorandum. No subject. 15 October 1926. Records of the Coast Guard Intel-
ligence Division 1922-1932, Record Group 26, Entry 297; National Archives Build-
ing, Washington, DC.

“The Bahamas,” Central Intelligence Agency Fact Book. URL: <http-// www.odci.gov/
cia/publications/factbook/country-frame.html>. Accessed 1 June 1998.

Baker, James S., Officer in Charge, Bellport Station. Letter to Superintendent, Fourth Dis-
trict. Subject: “Seaplane, Working with Rum Fleet.” 21 August 1924. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

“ie L. H., Force Communication Officer. Letter to Commander, Destroyer Force. Sub-
t: “Reported Activities at Chatham Radio Station; Investigation of.” 8 November
1021. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

“Belize,” Central Intelligence Agency Fact Book. URL: <http:// www.odci.gov/cia/ publi-
cations/factbook/country-frame.himl>. Accessed 1 June 1998.

“Bermuda,” Central Intelligence Agency Fact Book. URL: <http: /vww.odci. gov/cia/
publications/factbook/country-frame.huml>. Accessed 23 June 1998,

Berry, John G., Commander, Northwestern Division. Letter to all Units of Northwestern
Division. Subject: “Operations.” 18 May 1928. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

67


liquor." This trend of concealing liquor under otherwise legitimate cargo grew within the
coastwise trade and by the end of 1925 included not only disguises of fish, but also lum-
ber, coal, sand, and similar cargoes to throw the Coast Guard off the scent.>

Hiding liquor under loads of legitimate cargo was one of several concealment tactics
divulged to the Coast Guard by HUMINT reporting. In April 1930, the Coast Guard
learned that some rum vessels were equipped with “double bottoms” used to conceal their
liquor cargo."® False bottoms were also fabricated into automobiles used to pick up liquor
loads from rum vessels along the Mis:

As rum runners increasingly organized into syndicates with each passing year of the
Rum War, the Coast Guard compiled information on organized groups of rum runners and
shared it with other government agencies to bring down the rum syndicates in any way pos-
sible. As an example, in March 1929, the Coast Guard received a report allegedly linking Al
Capone with smuggling activities in Florida, whereby one gang was reportedly importing
60,000 cases of liquor a week into Palm Beach.** This information was shared with Cus-
toms and other law enforcement officials to counter Capone’s efforts in the Southeast U.S.

Even our neighbors to the North supplied the Coast Guard with HUMINT information.
High officials in the Canadian National Railways informed the Coast Guard of Canadian
rum runners’ intentions to market their wares at points along Lake Ontario and other areas
of the Great Lakes.”

Although HUMINT was used extensively to gauge the amount of liquor seeping in
through America’s shores, probably the most telling use of HUMINT was in evaluating
Coast Guard tactics against the rum runners. One of the most common practices to dis-
suade rum runners from delivering their cargoes was to picket known rum vessels for days
at a time, waiting them out, until the rum runner either turned back to open sea or returned
to its port of origin. In 1932, HUMINT reporting told the Coast Guard that the effects of
being trailed by Coast Guard vessels were “very disconcerting to the rum-runners.”>°

44 B. H. Camden, letter to Commandant, U.S. Coast Guard, subject: “Boarding Duty.” 3 August
1927.

45 Mabel W. Willebrant, Assistant U.S. Atomey General, letter to Commandant, U.S. Coast
Guard, no subject, 15 July 1925.

46 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Proposed Letter to All Units Except the Destroyer Force, Regarding Use of False
Bottoms, etc.,” 19 April 1930.

47 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, no subject, 23 March 1929.

“8 William J, Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Florida Situation,” 11 March 1929,

* Charles S. Root, CDR, USCG, Intelligence Officer, letter to Commandant, U.S. Coast Guard,
no subject, 2 June 1928.

5° Commander, Norfolk Division, letter to Commandant, U.S. Coast Guard, subject: “Informa-
tion Regarding Rum Running via Delaware Bay and the New Jersey Coast,” 8 December 1932.

24


Letter to Ralph R. Reed, Supervising Agent. No subject. 11 September 1928. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Iverson, R. J. Letter to CDR C. S. Root, USCG. No subject. 13 October 1925. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to CDR C. S. Root, USCG. No subject. 14 October 1925. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to LTJG Clifford D. Feak, USCG. No subject. 16 February 1928. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Chief of Division of Foreign Control. No subject. 14 March 1928. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to CDR Charles S. Root, USCG. No subject. 9 June 1928. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Jacobs, W. V. E., Commander, New York Division. Letter to Commandant, U.S. Coast
Guard. Subject: “Submarines, Possible Use for Smuggling.” 14 July 1924. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297:
National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Joseph McDonald and Seaplane
Attempting Contact with British Schooner ALMA R.” 21 January 1925. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Smuggling in Vicinity of Base
1.” 27 April 1925. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Jones, Robert L. The Eighteenth Amendment and Our Foreign Relations. New York: Tho-
mas Y. Crowell Company, Publishers, 1933.

Kahn, David. The Codebreakers: The Story of Secret Writing. New York: Macmillan Pub-
lishing Company, 1967.

Kaplan, H. R. “A Toast to the Rum Fleet.” U.S. Naval Institute Proceedings 94
(May 1968): 85-90.


Chapter 1
THE COAST GUARD AND THE ONSET OF PROHIBITION

At midnight on 16 January 1920 America officially went dry. Unofficially, it never
dried up. As America began its noble experiment with Prohibition no one could have fore-
seen the magnitude of illegal liquor importation, leading to rampant opportunism, govern-
ment corruption, and organized crime. Prohibition made the Roaring Twenties roar. In this
naive and challenging time the Coast Guard came of age, as the military service tasked
with stopping the seaborne flow of illegal liquor. Facing the monumental task of defending
the Atlantic, P: Gulf of Mexico and Great Lakes shorelines, the Coast Guard tumed
to intelligence to bridge the capabilities gap between well-organized smugglers and under-
resourced law enforcement. A natural question that appears not to have been addressed is
“What role did the intelligence effort play in combating smuggling operations?”

Drawing upon declassified Coast Guard Intelligence Division records at the National
Archives, this study brings to light the massive, all-source intelligence effort that
formed the backbone of Coast Guard operations in the “Rum War at Sea.” It shows how,
through a concerted effort to direct operations based on intelligence, the Coast Guard
was able to obtain and maintain dominant battlespace knowledge (DBK)! over the rum-
runners through the end of Prohibition. DBK allowed the Coast Guard and other federal
enforcement agencies to sustain an effective level of deterrence to liquor smuggling.
This successful marriage of intelligence and operations is also a model of interagency
cooperation in applying intelligence to a problem of national interest. At the conclusion
of this study, the reader will understand how the fusion of intelligence and the Coast
Guard’s enforcement strategy acted as a force multiplier, allowing the Coast Guard to
use DBK to its advantage in defeating a determined foe.

' Dominant battlespace knowledge (DBK) is defined as the “ability to understand what we see

and act on it decisively.” The resulting “enhanced vision” of the battlespace is a significant military
advantage, allowing military commanders to see clearly through the “fog of war” and make intelli-
gent decisions to favorably affect the outcome of battle. The DBK concept was first put forth in the
1990s and was not therefore, by name, a part of the Coast Guard's strategy in the Rum War at Sea.
However, the concept can be applied to the Coast Guard’s actions as a theoretical framework to
define and discuss the Coast Guard’s concerted effort to maintain its “information edge” in the Rum
War. Throughout this thesis, the term DBK is used interchangeably with “information superiority”
and “information dominance” to show how the Coast Guard used information as a force multiplier
in sustaining its successes over the rum runner through the end of Prohibition. National Defense
University, Dominant Battlespace Knowledge (Washington, DC: NDU, 1985), UB251.USD66, xi.



INTRODUCTION

The “lessons of history” are important tools in formulating the strategy, policy and tac-
tics to protect our national interests. The lessons learned from the use of intelligence in the
Rum War at Sea are totally applicable to today’s War on Drugs. Over ninety-five percent of
the drugs that reach our borders originate from source countries that rely on maritime
smuggling routes. The value of intelligence as a force multiplier in the Drug War, like that
chronicled by the author for the Rum War, cannot be overestimated. Still, these lessons had
to be leamed anew in the Drug War. In 1988 intelligence was a factor in approximately fif-
teen percent of drug interdictions. By 1998, it was the essential factor responsible for over
eighty-five percent of all interdictions. It is disappointing to know that it took over a decade
to convince the Intelligence Community, as well as other responsible agencies, that all-
source, fused intelligence was the most important element of our maritime strategy, both for
illegal drugs as well as illegal migration. All of the elements described by the author—inter-
agency cooperation, all-source intelligence, counterintelligence, operational security, com-
munications security, as well as HUMINT, COMINT and Imagery—have direct parallels to
today’s maritime interdiction operations. In this respect, the book is a valuable primer for
any intelligence strategist.

Many of the challenges faced in the use of all-source intelligence for border interdiction
operations are not readily apparent. In peacetime, border interdiction is the responsibility of
domestic agencies. Involvement in these so-called “police operations” is prohibited for the
Department of Defense as a matter of policy and law. The provision of intelligence obtained
from national sensors to domestic agencies that are “non-subscribers” becomes problematic.

As a member of the armed forces, the U.S. Coast Guard, with domestic police power, has
found itself in a unique position to use all-source intelligence, and to lead interdiction efforts.
It is interesting to note that the Drug War represents one hundred percent of the Drug Admin-
istration’s budget, forty percent of the U.S. Custom’s Service budget, ten percent of the Coast
Guard’s budget, and one quarter of one percent of the Department of Defense budget. The
Joint Interagency Task Forces (JIATFs) should really be called Joint Interagency “Intelli-
gence” Task Forces that fuse intelligence form all sources, for all users. This intelligence
product has become the essential weapon in the protection of our borders and an immense
force multiplier saving billions of dollars in the cost of vessel and aircraft operations.

T congratulate the Joint Military Intelligence College in educating our intelligence person-
nel in a “Joint” environment, making them cognizant of the lessons of history and the value
of intelligence in protecting our national interests. This opportunity has provided the author
the ability to accomplish his research and complete this valuable and useful work.

Adi . cK, s.

United States Coast Guard
Commandant 1994-1998


officers on the active rolls by June 1925.*” The Coast Guard had thus doubled in size from
1923 to 1925. The Coast Guard enlisted force continued to push the 10,000 mark, finally
crossing it by 1928. After the repeal of Prohibition in December 1933, force levels dropped
back to pre-War figures.

Coast Guard Officers and Civilians 1923~1934

1000.
900.
800.
700
600
500
400
300.
200
100.

"Commissioned
@ Warrant
O Civilian

0 =
1923 1924 1925 1926 1927 1928 1934

Figure 7. Officer and Civilian Enlargement.

Data Source: Treasury Department, Annual Reports of the Secretary of the Treasury on The State of the
Finances for the Fiscal Years 1923-1934 (Washington, DC: GPO).

7 Treasury Department, Annual Report for 1925, 423.
48 William P. Helm Jr., “Coast Guard Soon to Match Liquor Armada Ship for Ship?” Washington
(DC) Evening Star, 22 May 1925.

13


1924." At the same time, Commandant Billard himself indicated that by the summer of
1924, some 290 vessels, including steamers and sailing vessels, were steadily involved in
the rum trade.!!

The close proximity of islands such as the Bahamas and St. Pierre and Miquelon to the
U.S. Atlantic coastline created additional problems for enforcement. In 1920, U.S. legal
territorial waters extended only to three miles from shore, making the seizure of any non-
U.S. flagged vessel operating outside that limit outside the jurisdiction of the Coast
Guard.'? The British government turned a blind eye to American Prohibition, and in the
Bahamas and in Belize this compounded the problem as “a large portion of [the] Ameri-
can smuggling fleet was now sailing from [British] crown [colonies], with a cargo of
Scotch whiskey,'* under the protection of the British flag’”'* By the summer of 1921, a
virtual “Rum Row” had been established off the New Jersey and New York coasts, where

foreign-flagged rum runners supplied with liquor from the Bahamas, Belize, and St.
Pierre and Miquelon waited three miles offshore for American contact boats to come out
and purchase their liquor cargoes.!° This was in plain sight and much to the chagrin of
American enforcement officials. By the end of 1921, at least 20 known vessels made their
home along Rum Row. 1g

Figure 1. Rum-Running Speedboat

Source: U.S. Coast Guard, “Speedboat,”
photograph (Coast Guard Historian's Office,
Washington, DC: circa 1925).

10 Wayne B. Wheeler, General Counsel, the Anti-Saloon League of America, letter to Comman-
dant, U.S. Coast Guard, no subject, 24 July 1924. The location of this and other archival documents
are noted in the bibliography.

'! Commandant, U.S. Coast Guard, letter to Wayne B. Wheeler, General Counsel, the Anti-
Saloon League of America, no subject, 25 July 1924.

!? Willoughby, 29.

'3 Tn the early years of the Rum War, Scotch whiskey was the premiere liquor manufactured and
shipped by British liquor firms to British interests in the Bahamas and Belize. The first Scotch whis-
key produced entirely for the export market was “Cutty Sark,” bottled by Berry Brothers, liquor
merchants to Buckingham Palace. Spinelli, 28.

14 Spinelli, 30.

15 Willoughby, 23.

16 Willoughby, 27.


BCN Jee ISBN 0.9656195,3.2


U.S. Army Signal Corps. Shipping Ticket for 1000 cipher discs delivered to CDR Charles
S. Root, USCG. 24 April 1924. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
be.

U.S. Attomey General. Letter to McKenzie Moss, Assistant Secretary of the Treasury. No
subject. 27 August 1924. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

U.S. Coast Guard. “125-Foot Patrol Boats.” Photograph. Circa 1927. Coast Guard Histo-
rian’s Office, Washington, DC.

“Airplane.” Photograph. 1926. Coast Guard Historian’s Office, Washington, DC.

Annual Report of the United States Coast Guard for the Fiscal Year Ended June 30
1921. Washington, DC: GPO, 1921. 2901. Coast Guard Historian’s Office, Washing-
ton, DC.

Biography for Prohibition Era Commandants William E. Reynolds, Fredrick G.
Billard, and Harry G. Hamlet. No subject. N.d. Coast Guard Historian’s Office,
Washington, DC.

“Black Locations February 1-July 31, 1929.” Chart. N.d. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Despatch for Commander, Destroyer Force. No subject. 29 December 1924. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

“Destroyers Assigned to the Coast Guard.” Photograph. Circa 1925. Coast Guard His-
torian’s Office, Washington, DC.

Doctrine for Prevention of Smuggling. Washington, DC: USCG, 15 July 1924. Coast
Guard Historian's Office, Washington, DC.

“Eighth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Eleventh District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Fifth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“First District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.


Letter to LT W. R. Richards, USCG. No subject. 8 May 1931. Coast Guard Histo-
rian’s Office, Washington, DC.

“Mexico,” Central Intelligence Agency Fact Book. URL: <http:// www.odci.gov/cia/ pub-
lications/factbook/country-frame.html>. Accessed 23 June 1998.

Moss, McKenzie, Assistant Secretary of the Treasury. Letter to Commandant, U.S. Coast
Guard; Directors of Customs and Spi Agency Services; and Prohibition Commis-
sioner. Subject: “Territorial Respons in the Prevention of the Smuggling of
Liquor.” 2 May 1924. Coast Guard Historian’s Office, Washington, DC.

Mowry, David P. Historian at National Cryptologic Museum. Interview by author, 5
December 1997.

Mueller, G.O.W., and Freda Adler. Outlaws of the Ocean: The Complete Book of Contem-
porary Crime on the High Seas. New York: Hearst Marine Books, 1985.

Munter, W. H., CDR, USCG. Letter to Commandant, U.S. Coast Guard. Subject: “Intelli-
gence Information, Whereabouts of Vessels Engaged in the Liquor Trade.” 21 August
1924. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

National Defense University. Dominant Battlespace Knowledge. Washington, DC: NDU,
1995. UB251.USD66.

“Netherlands Antilles.” Central Intelligence Agency Fact Book. URL: <hitp://jwww.
odci, gov/cia/publications/factbook/country-frame.html>. Accessed 18 June 1998.

Osborn, E. T., Officer-in-Charge, Coast Guard Station Little Beach. Letter to Commander,
Fifth District. Subject: “Use of a Radio Broadcasting Motor Truck by Smugglers;
Report of.” 29 July 1931. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Parker, George A., Federal Prohibition Administrator. Letter to Commandant, U.S. Coast
Guard. No subject. 5 December 1925. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

“Prohibition Cartoon/Lot 2714,” State Historical Society of Wisconsin. URL: <http: //
144.92.37.98 /histl 02/photos/html/1145.html>. Accessed 2 June 1998.

The Prohibition Era: The Dry Crusade. Prod. Charlotte Moore, dir. Clive Maltby. 50 min.
A&E Home Video, 1997. Videocassette.

The Prohibition Era: The Road to Repeal. Prod. Charlotte Moore, dir. Clive Maltby. 50
min. A&E Home Video, 1997. Videocassette.

The Prohibition Era: The Roaring Twenties. Prod. Charlotte Moore, dir. Clive Maltby. 50
min, A&E Home Video, 1997. Videocassette.

79


ary 1928. No subject. N.d. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to CAPT H. G. Hamlet, USCG. No subject. 14 January 1928. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. No subject. 2 June 1928. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to President, Regulations Board. Subject: “Chapter 7, Regulations, Revision of.
Duties of the Intelligence Office.” 9 August 1928. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Memorandum for Mr. Minot. No subject. 31 August 1928. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Communications. No subject. 10 November 1928. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commissioner of Prohibition. No subject. 11 December 1928. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Unaddressed letter. No subject. 22 August 1929. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to CAPT Randolph Ridgely, USCG. No subject. 28 May 1930. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to J. Edgar Hoover, Director, Bureau of Investigation. No subject. 21 June
1930. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

“Rum Row and Finger Prints.” The Outlook, 1 August 1928. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Sanderson, Bennet, Assistant U.S. Attorney. Letter to CDR Charles S. Root, USCG. No
subject. 4 January 1926. Records of the Coast Guard Intelligence Division


an assistant, Lieutenant Junior Grade (LTJG) Clifford D. Feak, in early 1927. As part of
his introduction to intelligence work, LTJG Feak was instructed in cipher fundamentals
under the guidance of the legendary Major William F. Friedman, of the War Department’s
Signal Corps.!* The year 1927 also brought two new civilian personnel to the Intelligence
Section: Major Friedman’s wife, Mrs. Elisabeth S. Friedman, and Anna A. Wolf, both hired
by the Prohibition Bureau and detailed to the Coast Guard to assist in cryptanalysis.'>

The Intelligence Section, having grown from a one-man operation in 1924 to a force of
five by 1927, continued to expand its responsibilities and its support to operations until
the repeal of Prohibition in 1933. In 1928, the expanded duties of the Intelligence Section
were laid out by CDR Root as follows:

I. The Intelligence Office collects, sifts, and indexes all information which may be
useful and which is obtainable from every possible source and holds this informa-
tion available for immediate use or dissemination as the Commandant directs.

II. It receives and distributes, by officer messenger, or under seal, all confidential
correspondence received by Headquarters and has custody of the joint war plans
and other secret files.

III. It solves all enemy cryptograms and problems of like nature received from the
forces afloat or afield and handles problems of like nature, received from other
bureaus of the Treasury, as a matter of cooperation.

IV. It handles and covers into the Treasury miscellaneous funds received from the
Field as a result of operations against the enemy and handles other confidential
funds in the sum of about $2,000 a month.

V. The Office, under the direction of the Commandant, maintains liaison with other
departments of the government in law enforcement and confidential matters.

VL. It conducts all correspondence with the courts relating to the taking over of
seized vessels by the Service.

3 Charles $. Root, CDR, USCG, Intelligence Officer, memorandum of Telephone Conversation
Between CDR Root, Coast Guard Headquarters and MAJ Friedman, War Department, Signal
Corps, 10:25 a.m., 24 January 1927, no subject, n.d.

'4 Charles S. Root, memorandum of Telephone Conversation Between CDR Root, Coast Guard
Headquarters and MAJ Friedman, War Department.

'5 Blisabeth Friedman was hired as a Cryptanalyst at a starting salary of $2,400 annually. She
was employed by the Federal Prohibition Bureau, but detailed to the Coast Guard's Intelligence
Section. Roy A. Haines, Federal Prohibition Commissioner, letter to Civil Service Commission, no
subject, 27 April 1927. Anna Wolf, a Junior Stenographer, was also employed by the Federal Prohi-
bition Bureau and loaned to the Coast Guard to assist Mrs. Friedman. B. M. Chiswell, CAPT,
USCG, letter to J. M. Doran, Commissioner of Prohibition, no subject, 24 February 1928.


INTELLIGENCE
IN THE RUM WAR
AT SEA, 1920-1933

by LT Eric S. Ensign, USCG

With an Introduction by
Admiral Robert E. Kramek, USCG (Ret.)
Commandant, U.S. Coast Guard, 1994-1998



1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington DC.

Sands, S. R., Fourth District Superintendent. Letter to Commandant, U.S. Coast Guard.
Subject: “Intelligence Office Circular No. 519.” 11 November 1925. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Schoenbom, H. F., LCDR, USCG. Letter to Radio Gunner Robert W. Finley. No subject.
28 April 1925. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Assistant U.S. Attorney Bennet Sanderson. No subject. 6 January 1926.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commander, New York Division. Subject: “Intercepted Code Messages.”
29 January 1926. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Secretary of State. Letter to Secretary of the Treasury. No subject. 12 April 1924. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Secretary of the Treasury. No subject. 14 April 1924. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Secretary of War. Letter to Secretary of the Treasury. No subject. 8 April 1924. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Secretary of the Treasury. No subject. 9 September 1930. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Smiley, Nora K., and Louise V. White. History of Key West. St. Petersburg: Great Out-
doors Publishing Company, 1959.

Solt, C. T., Radio Electrician, USCG. Letter to Communication Officer. Subject: “Type X
High Frequency Radio Direction Finding Equipment, Development and Test of.”
4 December 1930. Coast Guard Historian’s Office, Washington, DC.

Spinelli, Lawrence. Dry Diplomacy: The United States, Great Britain and Prohibition.

Ph.D. Dissertation. New York: History Department, Graduate School of Arts and Sci-
ences, New York University, 1984.

83


tion of “Suspect Li ‘aed containing the names, photographs, and descriptions of all vessels,
foreign and domestic, known to be engaged in liquor smuggling.'*

Figure 13. Black Locations Based on Intelligence.

Source: U.S. Coast Guard, “Black Locations February 1-July 31, 1929,” chart (Records
of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC: 1929).

As an example of the success the Coast Guard enjoyed through its application of all-
source intelligence to the problem of Prohibition enforcement, CDR Root provided
details of an “all-source” operation in 1928 where:

s the “identification book of blacks” di
chapter. See, Commander, Eastern Di

‘67 Suspect Lists were probably the same produc!
in the section on Imagery Intelligence earlier in thi
24 December 1929.

‘68Waters, Smugglers of Spirits, 75. Also see, Charles S, Root, 9 August 1928, 5.

42


already identified by 1924, Coast Guard assets were outnumbered four to one. Addition-
ally, in 1923, total Coast Guard personnel numbered only 4,140, including 206 commis-
sioned officers, 395 warrant officers, 3,496 enlisted men, and 43 civilians. These 4,140
personnel were organized into 13 Coast Guard Districts, or geographical areas encom-
passing sections of the U.S. coastline, with a combined total of 237 active shore sta-
tions.*! Under the guidance of its headquarters in Washington, DC, the Coast Guard force
structure was designed to provide for its primary life-saving mission, rather than for a
military blockade of America’s shorelines. Clearly, additional measures would be
required for the Coast Guard to be able to meet the challenge of confronting and stopping
the flow of liquor into the U.S. by sea.

3! Treasury Department, Annual Report for 1923, 458.


the Coast Guard to take the lead role. Federal Prohibition agents were heavily involved in
combating liquor on land and had little time for seaward enforcement. In January 1923, the
Collector of Customs asked the Secretary of the Treasury to “clearly [outline] the respec-
tive functions of the Customs, Coast Guard, and Prohibition authorities.”** One month
later, the Assistant U.S. Attorney General implored the Secretary of the Treasury to assign
responsibility for Prohibition enforcement along the entire U.S. coastline to the Coast
Guard, as “neither the [C]ustoms nor the [P]rohibition [S]ervice [were] properly equipped
for coping with the situation.”?> This put additional pressure on the Coast Guard to divert
personnel and vessels from its other missions to law enforcement. In response, Comman-
dant Reynolds addressed the Coast Guard's limited ability to enforce the Prohibition laws
in a letter to the Treasury Department's Budget Director in May of 1923. He asked for an
immediate additional appropriation of $5 million, to purchase roughly 100 additional small
craft and fuel for Coast Guard cutters engaged in Prohibition enforcement.”

The Secretary of the Treasury agreed that the Coast Guard be given the main enforce-
ment respo lity for stopping the influx of liquor by sea. In May 1924, a division of
responsibilities for enforcement among the Coast Guard, Customs Service, and the Fed-
eral Prohibition Bureau were put forth in a Treasury Department directive giving the
Coast Guard responsibility for enforcing the Prohibition laws on the waters along the
“Atlantic Coast, Gulf Coast, Pacific Coast including Alaska, waters of Puerto Rico and the
Virgin Islands, and waters of the Hawaiian Islands.”?” The Coast Guard was also given
responsibility for most of the boundary waters between the U.S. and Canada. Knowing
the Coast Guard was not adequately equipped for its new mandate, the Secretary of the
Treasury also allowed the Coast Guard time to build and launch an effective enforcement
capability.”

The Coast Guard’s designation as the primary government agency responsible for
enforcing the Prohibition laws at sea presented a formidable problem—how to effectively
police 12,000 miles of U.S. coastline”? with a force of only 75 commissioned vessels,
most of which were not designed for law enforcement.*? With 290 rum-running vessels

*4 Collector of Customs, U.S. Customs Service, letter to the Secretary of the Treasury, no sub-
ject, 24 January 1923.

25 Mable W. Willebrant, Assistant U.S. Attormey General, letter to the Secretary of the Treasury,
no subject, 7 February 1923.

26 Commandant, U.S. Coast Guard, memorandum for General Lord, Director of the Budget,
subject: “Availability of the Coast Guard to Enforce Prohibition Law,” 3 May 1923.

27 McKenzie Moss, Assistant Secretary of the Treasury, letter to Commandant, U.S. Coast
Guard; Directors of Customs and Special Agency Services; and Prohibition Commissioner, subject:
“Territorial Responsibility in the Prevention of the Smuggling of Liquor,” 2 May 1924.

28 Moss, 2 May 1924.

* The U.S. coastline extends over 12,352.88 miles. “The United States,” Central Intelligence
Agency Fact Book, URL: <http://www.odci.gov/cia/publications/factbook/country -frame.html> ,
accessed 9 July 1998,

%° Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1923 (Washington, DC: GPO, 1923), 458.



by Mrs. Friedman indicating they could be solved in nine minutes and were “not suffi-
ciently secure for any important use.”>

The Coast Guard did use its own codes and ciphers occasionally to communicate with offi-
cials outside of Coast Guard channels. Codes were developed for Coast Guard officers and
Customs officials to communicate with each other in an emergency.”° In 1928, CDR Root
developed a cipher used to communicate HUMINT information from the Director of Investi-
gations of the Canadian National Railways to the Coast Guard Intelligence Section concerning
the smuggling situation on the Great Lakes.” On rare occasions the Coast Guard radioed the
names of ves iriving at or departing from foreign rum por
made in hopes of intimidating the rum-runners into scuttling their smuggling plans.
tic was only used when the benefits were deemed to outweigh the need for secrecy.

In addition to protecting codes and ciphers themselves, the Coast Guard instituted pro-
cedures to limit the amount of radio traffic passed between operational units to deny the
Opponent any opportunity to collect enough information to gain usable intelligence. In
April 1926, Commandant Billard commissioned a board of two officers to “study the
Coast Guard communications system in connection with daily reports of offshore rum
running activities and to make suitable recommendations.””? Based on the board’s find-
ings, Coast Guard Division and Force Commanders were ordered to report once daily, the
going to sea or returning to port of Coast Guard vessels under their command and at the
same time, the positions of any blacks noted at sea.*’ If there was no change in the opera-
tional status of Coast Guard vessels under their command and no blacks sighted on any
particular day, then a report was not required. This had the desired effect of limiting oper-
ational radio traffic, but it also hampered the Coast Guard’s ability to maintain informa-
tion superiority by not knowing where its own forces were at any given time.*! The
measure was subsequently reversed in favor of using alternating codes for passing opera-
tional information and limiting the number of “leaks” in the process.*?

?5 Charles S. Root, CDR, USCG, Intelligence Officer, letter to Philip Hamlin, no subject,
3 June 1927.

26 Charles S. Root, CDR, USCG, Intelligence Officer, memorandum of Telephone Conversation
Between CDR Root, Coast Guard Headquarters and Mr. Oftedal, Assistant Commissioner of Prohi-
bition, 10:00 a.m., 5 January 1928, no subject, n.d.

27 Charles S. Root, CDR, USCG, Intelligence Officer, letter to Commandant, U.S. Coast Guard,
no subject, 2 June 1928.

28 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, sul “Recommendation by Mr. Thomas Finnegan, Veteran Deputy Collector, Boston,
Massachusetts,” 28 April 1928.

°° Commandant, U.S. Coast Guard, letter to CDR W. H. Munter and LCDR G. E. Wilcox, sub-
ject: “Board to Recommend Improvement in Communication System,” 5 April 1926.

*° William J, Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Positions Coast Guard Vessels and “Blacks” - Routine Reports,” 12 November
1927.

+L. V, Kielhorn, LCDR, USCG, letter to CAPT William J. Wheeler, USCG, no subject,

3 December 1927.

%2 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast

Guard, subject: “Proposed Change in System of Position Reports,” 19 December 1927.

55


In the Navy Department the Intelligence Office is in contact with the Hydrographic
Office and with the Communications Service.

In the Department of Justice the Intelligence Office works with the Bureau of Inves-
tigation, the division of Criminal Identification, and with those divisions which han-
dle frauds against the Government, forfeitures in admiralty, and prosecutions
involving breaches of the laws of the United States on the ocean. Direct correspon-
dence is maintained with United States Attorneys in those ts where coopera-
tion is good.

In the Post Office Department the office works, on oc:
tor of that department which has charge of all

In the Interior Department the Intelligence Office corresponds with the Geological
Survey concerning boundary lines on the coast.

In the Department of Commerce we correspond principally with the Bureau of Nav-
igation and the Steamboat Inspection Service.

With the Department of Labor liaison is maintained with the Bureau of Immigration
in matters pertaining to the smuggling of aliens. (Alien running, smuggling, and
narcotic and liquor running are very often performed by the same organization).

With the Shipping Board correspondence is maintained concerning the transfer of
American vessels of foreign flag or registry. Vessels are never transferred without
reference to the Intelligence Office of the Coast Guard.

In the Treasury Department liaison is maintained with the offices of the Assistant
Secretaries, having supervision of Customs, Prohibition, Narcotics, and the Public
Health Service and with those bureaus directed by them and, when necessary, with
the Division of Secret Service.'*

As the need for “instant” communication with these agencies became increasingly reg-
ular, the Intelligence Section hired an additional clerk who was regularly “dispatched to
other Departments with urgent confidential communications.”'* Although the Intelli-
gence Section maintained regular liaison with numerous agencies, the cooperation solic-
ited from the Departments of State, Justice, and War, and the interagency cooperation
with the Prohibition Bureau and Customs Service were the most beneficial for the Coast
Guard. The Department of State was most helpful in supplying HUMINT information
from its consulates overseas on the plans and intentions of foreign rum-runners to ship

‘43st office boxes were used for clandestine communications with undercover Coast Guard oper-
atives. The Chief Inspector provided and maintained the boxes under fictitious names and addresses at
stations and cities convenient for Coast Guard use. Charles S. Root, 9 August 1928, 4.

'4Charles S. Root, 9 August 1928, 2.

'45Charles S. Root, CDR, USCG, Intelligence Officer, unaddressed letter, no subject,

22 August 1929.


“Radio Set is Devised to Aid Coast Guard Battle Rum Fleet.” Unidentified Newspaper,
n.d. Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Randell, Jack. I’m Alone. Indianapolis: The Bobbs-Merrill Company, Publishers, 1930.

Read, Ralph R., Supervising Agent. Letter to Seymour Lowman, Assistant Secretary of
the Treasury. No subject. 9 April 1928. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Letter to Commissioner of Prohibition. No subject. 12 September 1928. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Alf Oftedal. tant Commissioner of Prohibition. No subject. 27 Decem-
ber 1928. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commissioner of Prohibition. No subject. 6 February 1929. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Reeves, C. E., Special Agent. Letter to Mr. Topham. No subject. 16 January 1928.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Ralph R. Read, Supervising Agent. No subject. 26 December 1928. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Richards, W. R., LT, USCG. Letter to LT Frank M. Meals, USCG. No subject. 4 May
1931. Coast Guard Historian’s Office, Washington, DC.

Roach, P. F., Commanding Officer, CASSIN. Letter to Commander, Destroyer Force.
Subject: “Intercepted Radio Message.” 12 December 1925. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Robinson, Geoff, and Dorothy. Jt Came By the Boat Load. Canada: Alfa-Graphics Ltd.,
1983.

Root, Charles S., CDR, USCG, Intelligence Officer. Letter to Customs Information
Exchange. No subject. 18 February 1924. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.


Department and the Coast Guard Repair Depot in manufacturing a wooden deciphering
machine to facilitate Mrs. Friedman's work.°*

Even though the cryptologic work being undertaken at Coast Guard Headquarters was
initially limited to the expertise of CDR Root, LTJG Feak, Mrs. Friedman, and Mrs. Wolf,
the lines between cryptology and communications in the Coast Guard soon faded as the
Communications Section became the Intelligence Section’s “right arm” in supplying the
bulk of intercepted radio tr to Headquarters for analysis. As the proficiency of Coast
Guard radio intercept operators increased, the Communications Section, headed by Lieu-
tenant (LT) E. M. Webster, began to st the headquarters staff with solving enemy
codes and ciphers.*?

The first challenge for the Communications Section, however, was to equip the Coast
Guard's anti-smuggling fleet with HF radios and set up a series of shore-based listening
posts patterned after the one in New York. This was not a problem for the Destroyers and
larger Coast Guard cutters as they were already equipped with radio. The patrol boats
were also outfitted with radio as they were commissioned. Picket boats and smaller Coast
Guard vessels had to be outfitted individually, with special equipment, to give them an
intercept capability. As the value of COMINT became increasingly evident, additional
shore-based intercept stations were rapidly established in New York, Massachusetts, Con-
necticut, New Jersey, Virginia, Florida, Alabama, California, and Washington State.°!

To assist codebreaking efforts at Headquarters, a large volume of intercepted radio traffic
was needed.” To bring this about, CDR Root issued a directive requesting that all “Com-
manding Officers of cutters while at sea, direct their radio operators to listen in and try to
obtain all code messages being sent by Blacks equipped with radio apparatus.” This
immediately created difficulties for overworked radiomen who were “already heavily
loaded with [Coast Guard] traffic and that [had] no time [remaining] for any systematic lis-
tening in for Black traffic." To address this problem, the Coast Guard quickly recruited and
trained radio operators with prior Navy, Army, or commercial experience.°> In addition, the
Coast Guard placed heavy emphasis on the operations of shore-based intercept stations that
could be devoted exclusively to intercepting rum traffic.°° To meet the demand for COM-
INT intercepts, some shore-based listening posts instituted 24-hour communications

58 Charles S. Root, CDR, USCG, Intelligence Officer, letter to CAPT Randolph Ridgely, USCG,
no subject, 4 February 1927.

59 Willoughby, 105-110.

© Willoughby, 107.

©! Willoughby, 107.

© Commandant, U.S. Coast Guard, letter to Eastern Div., N.Y. Diy., Norfolk Div., Desfor,
N.L.PA., Bases 1, 2, 3, 4, 5, 7, 8, 9, 18, no subject, 12 October 1925.

© G.C. Carmine, Commander, New York Division, letter to Commandant, U.S. Coast Guard,
subject: “Listening in for Black Traffic.” 1 February 1926.

 G.C. Carmine, 1 February 1926.

© Willoughby, 106-107.

6 E. M. Webster, memorandum to Intelligence Officer, no subject, 6 November 1928.

26


[t]wo schooners whose movements were directed from New York by telegraph,
were being operated out of Nassau. Telegrams were sent from Nassau by radio to a
Miami address. Replies were sent from New York to Nassau in cipher by radio,
indicating a land wire link from Miami to New York. The New York addressee was
located and it was discovered that he was communicating with Bayport, Florida
West coast, by land line telegraph. This office had on file information from a
friendly hotel keeper at Brooksville, Florida, des ing two schooners which might
have been the ones concerned in the telegraphi spondence. Three days after
these vessels next sailed from Nassau, the Gulf jon was ordered to search 20
miles west of Bayport. The vessels were found, their game broken up, and the New
York director left New York post haste for fear of arrest for conspiracy.'©°

PRRUALESCE Of Races HITe PEF PEASES OF WOO

359

TOR THE yeaR BeDINa saTAST 51

(ote the increasing tendency toward the clove of the year to esseaatrate during the dare of the soos)

Figure 14. Smuggling Fluctuations with Moon Phases.

Source: U.S. Coast Guard, “Prevalence of Blacks with Reference to Phases of Moon for
the Year Ending January 31, 1930," chart (Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC: 1930).

‘Charles S. Root, 9 August 1928, 7.

43


Communications Intelligence

The Coast Guard’s COMINT collection program did not achieve full implementation
until the mid-to-late 1920s. However, as early as 1924, just months after the Coast Guard
was given the task of stopping the flow of liquor onto America’s shores, LCDR Root
began collecting intercepted messages from a small number of alleged rum runners who
were already equipped with radio.*' Unable to solve the crude codes himself, LCDR Root
called on the U.S. Navy for assistance. After solving one message that led to a successful
interdiction operation on Rum Row, the Navy concluded it “could not lawfully handle
work of this nature,” and “suggested the Coast Guard organize its own decrypting unit.”
And that is exactly what the Coast Guard did.

The use of radio among rum runners was still rare in the early days of Prohibition, but
became more prevalent as the rum runners organized and looked for easier and securer
ways to communicate with their land-based offices. In late 1925, LCDR Root joined
forces with Mr. R. J. Iverson of the New York Times to set up a small intercept station in
New York City.>? For several years, this crude intercept station supplied the Coast Guard
with the identification of amateur shore stations and radio-equipped vessels involved in
the rum trade.*4 By 1927, the use of codes and ciphers among rum-running vessels was
commonplace and with the help of the War Department’s Signal Corps, the Coast Guard
was developing a cryptologic capability of its own, under the Intelligence Section at
Headquarters.°° One of the first steps CDR Root took to resolve the backlog of encrypted
messages piling up at Headquarters was to elicit the assistance of the renowned cryptana-
lyst, Mrs. Elisabeth Friedman.*° Although Mrs. Friedman was not officially hired until
1927, she was temporarily employed under the direction of the Intelligence Section for
several months in 1926 and had donated her services in solving enemy cryptograms on
numerous occasions in the interim.’ CDR Root also gained the assistance of the War

5! Director of Naval Communications, letter to Secretary of the Navy, subject: “Coast Guard,”
21 January 1931.

*? Director of Naval Communications, 21 January 1931.

53 With an HF receiver, an Underwood typewriter, and a $500 advance, Mr. Iverson set up a lis-
tening post in New York City, staffed by an unnamed civilian intercept operator who drew an annual
salary of $2,800 from the Coast Guard. R. J. Iverson, letter to CDR C. S. Root, USCG, no subject,
13 October 1925. Also see, R. J. Iverson, letter to CDR C. S. Root, USCG, no subject, 14 October
1925.

4 Clifford D. Feak, LTJG, USCG, letter to R. J. Iverson, no subject, 1 February 1928.

55 Charles S. Root, 24 January 1927.

56 Mrs. Friedman began her career in cryptology in 1916 at Riverbank Laboratories, Illinois,
where she developed code-making methods for the U.S. military. During parts of 1922 and 1923,
she served with the Code and Signal Section of the U.S. Navy. She also served as a cryptanalyst for
the U.S. Army. Together with her husband, William F. Friedman, the Friedmans gained a reputation
as the “foremost [authorities] in the science of cryptanalysis in the United States.” Charles S. Root,
CDR, USCG, Intelligence Officer, memorandum for Major Hamlin, subject: “Mrs. Elizabeth Smith
Friedman,” 22 April 1927.

°7 Charles S. Root, 22 April 1927.

25


as scheduled in early 1934.” Although they did not see service in the Rum War, these new
aircraft were the catalyst for the Coast Guard’s air-based search and rescue mission, a major
focus of the Coast Guard’s first post-Prohibition Commandant, RADM Harry G. Hamlet.?>

Although some smuggling continued up to the end of Prohibition, by early 1933 it was
“a mere trickle compared with before.”** By combining personnel, vessels, aircraft, and
intelligence, the Coast Guard created a unified front which allowed for a refined and
highly effective enforcement strategy as the Rum War came to a close.

CONCLUSION: WINNING THE RUM WAR
WITH INTELLIGENCE

In 1920 no one could have foreseen the magnitude with which liquor would be smug-
gled onto America’s shores as the great experiment with Prohibition began. The prolifera-
tion of smuggling rapidly reached huge proportions and by 1924 it was clear a declaration
of war was necessary to enforce American’s self-imposed ban on alcohol. The Coast
Guard responded with an aggressive campaign to stem the tide of liquor beginning in the
summer of 1924. Throughout the decade-long struggle that followed, the Coast Guard
fought the Rum War on many fronts. It doubled its personnel and more than quadrupled
its afloat assets, lobbied for treaties to extend US. territorial seas to 12 miles, and devel-
oped explicit doctrine for the prevention of smuggling. These efforts, while impressive for
such a small service, left the Coast Guard with a formidable challenge—how to make the
most use of its forces to cover 12,000 miles of shoreline in stopping the flow of liquor into
the U.S. by sea. With an approximate 200 vessels at sea at any given time, the only way
the Coast Guard could have blockaded the nation’s shores would have been to stage one
vessel every 720 square miles of ocean within the 12-mile limit. Obviously, this would
have been ineffective had it been attempted. Instead, to bridge the gap between available
forces and the expansive battlefield, the Coast Guard turned to intelligence and used it
relentlessly to pursue, acquire, and maintain DBK over its increasingly sophisticated foe.
It was the intelligent use of intelligence that allowed the Coast Guard to dominate the
struggle for information superiority and in turn, multiply the effectiveness of its anti-
smuggling force. Using the various intelligence disciplines, the Coast Guard was able to
“familiarize [itself] with the operating orders of the rumrunners ... [and] take immediate
action in the field on the information obtained.” Taken in their component parts, it is
clear each intelligence discipline —HUMINT, COMINT, IMINT, and Open Source Intel-
ligence—played a key role in the Coast Guard’s ability to use information as a highly

> Treasury Department, Annual Report for 1934, 80.

> U.S. Coast Guard, Biography for Prohibition Era Commandants.

> Harold Waters, “Five Flashes East,” 85.

>5 Willoughby, 163-164. 12,000 mile shoreline figure is approximate and was taken from “The
United States,” Central Intelligence Agency Fact Book, URL: <http:/Avww.odci.gov/cia/publica-
tions /factbook/country-frame.html>, accessed 9 July 1998.

© Unidentified correspondent, transcript of LCDR Gorman’s remarks following Admiral Bil-
lard’s speech, no subject, n.d., 3.



SCOPE OF THE PROBLEM FACING THE COAST GUARD

The Volstead Act, passed to enforce the 18th Amendment, ironically fueled America’s
popular resolve to stay wet. Although it outlawed the manufacture, sale, and transporta-
tion of alcohol, it made no provisions against buying or drinking alcohol.” The risk in
breaking the law remained with the seller. As America’s thirst for alcohol grew, so did the
numbers of those willing to supply it. Manufacturing and importing alcohol immediately
became a very lucrative business.’ Even though many individuals resorted to distilling
alcohol for themselv legally acquiring alcohol meant for medicinal and religious pur-
poses, or extracting alcohol from other preparations, the principal trade in illegal alcohol
occurred through the importation of foreign alcohol into the U.S. by sea.‘ It was against
this game plan that the Coast Guard waged an unrelenting campaign to detect, monitor,
apprehend, and support the prosecution of those who smuggled alcohol on the high seas
and navigable waterways of the U.S.

As the demand for alcohol increased, foreign distillers were only too happy to respond,
in essence taking over the American liquor industry. In Great Britain, domestic liquor
sales were sagging and Prohibition opened the door for the exportation of British liquor to
their crown colonies in the Western Hemisphere. In the Bahamas alone, liquor imports
from Great Britain rose from 27,427 gallons in 1918 to 567,940 gallons in 1921,° then to
2.5 million gallons in 1922.’ The liquor was then sold to American opportunists and orga-
nized crime syndicates who “imported” it into the U.S. This same scenario was repeated
for the British crown colony of Belize and the French islands of Saint Pierre and Mique-
lon, located off the coast of Newfoundland. European and Canadian liquor poured into
these outposts, where it was warehoused awaiting transshipment to the U.S. Vessels of all
types and registries called on these islands, transforming quiet, isolated towns to “some-
thing like American mining settlement[s] in the days of the gold rush.” In a letter to
Coast Guard Commandant Frederick C. Billard? the Anti-Saloon League of America
reported liquor valued at $500 million was expected to be smuggled into the U.S. in

? The Prohibition Era: The Roaring Twenties, prod. Charlotte Moore, dir. Clive Maltby, 50
min., A&E Home Video, 1997, videocassette.

3 In the early days of rum-running, exorbitant profits of up to 700 percent were reported. Liquor
costing $8 a case at the port of origin sold for $65 a case along America’s shorelines. Hugh Garling,
“The United States Coast Guard: Part II.” Nautical Magazine 247, no. 2 (February 1992): 103.

* The Prohibition Era: The Roaring Twenties.

5 Lawrence Spinelli, Dry Diplomacy: The United States, Great Britain and Prohibition, Ph.D.
Dissertation (New York: History Department, Graduate School of Arts and Sciences, New York
University, 1984), 24.

© Spinelli, 28.

7 Malcom FE Willoughby, CDR, USCGR(T), Rum War at Sea (Washington, DC: GPO, 1964), 29.

8 Willoughby, 29.

° Rear Admiral Billard was the Coast Guard Commandant from 1924 to 1932, during the main
Coast Guard effort to enforce Prohibition. His predecessor was Rear Admiral Reynolds, Comman-
dant from 1919 to 1924, and his successor was Rear Admiral Hamlet who became Commandant in
1932 and led the Coast Guard until 1936.



THE EFFECTIVENESS OF EARLY EFFORTS AGAINST
RUM RUNNING

Each of the Coast Guard's early efforts to stop liquor smuggling met with varying
degrees of success. By June 1925, the number of Coast Guard vessels had grown from a
moderate 75 vessels in 1923 to a fleet of 16 first-class cruising cutters, 17 second-class
cruising cutters, 17 harbor cutters, 19 harbor launches, 20 destroyers,>? 200 75-foot patrol
boats, and approximately 100 picket boats.°! Aided by the new 12-mile limit, the Coast
Guard imposed a blockade against illegal liquor traffic along Rum Row and effectively
disbanded the Row by early 1925.>? This was in sharp contrast to the first few years of
Prohibition where the Coast Guard prevented “no more than five percent of the U.S.-
bound liquor from reaching its destination.”>*

As the Coast Guard's successes became known, the rum fleet became more secretive
about its operations and more elusive to the now formidable anti-smuggling armada. Natu-
rally, when smuggling is stopped in one area it tends to move to another, in a “balloon effect.”
This is what happened to the illegal rum trade. Once the Coast Guard’s presence was felt and
started impacting the livelihood of the rum runners, it was clear the “easy” days of smuggling
were over. But for the Coast Guard, this meant the successes they had enjoyed over the period
from late 1924 to 1926 would become increasingly rare. This was underscored in the 1927
Annual Treasury Report which indicated “[t]he fact that the Coast Guard must now search
diligently to find the rum-running vessels, a number being undoubtedly engaged in the traffic,
.» really occasions a greater burden and responsibility upon personnel and ships than was the
case when rum row existed and the foreign liquor vessels anchored in groups near [U.S.]
shores:”>' As the rum trade moved “underground” into the open sea, the Coast Guard entered
into a battle of wits with the rum runners to attain Dominant Battlespace Knowledge and
thereby greatly magnify the effectiveness of its newly commissioned fighting force.

4° Commandant, U.S. Coast Guard, letter to Commander, New London Patrol Area, subject:
“Painting of Cruising Cutters and Other Vessels Engaged in Law-Enforcement Operatioi
26 November 1926,

5° Five more destroyers were transferred from the Navy in 1926, bringing the total to 25.

5! Treasury Department, Annual Report for 1925, 424.

52 ‘Treasury Department, Annual Report for 1925, 422.

°3 Hugh Garling, “The United States Coast Guard: Part II,” Nautical Magazine 247, no. 2 (Febru-
ary 1992): 103,

4 Treasury Department, Annual Report for 1927, 158.

16


Letter to Martha N. Brooks, Alderman, City of Gloucester, Massachusetts. No sub-
ject. 26 May 1924. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Chief Clerk, Coast Guard Headquarters. Subject: “Clerical Assistance.”
3 February 1925. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commander, Base Nine. Subject: “Enemy Communication.” 10 October
1925. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Communications to New York
Division.” 12 October 1925. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
Dec.

Letter to George A. Parker, Federal Prohibition Administrator. No subject. 31 Decem-
ber 1925. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Patrol Areas.” 9 December 1926.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Memorandum of Telephone Conversation Between CDR Root, Coast Guard Head-
quarters and MAJ Friedman, War Department, Signal Corps, 10:25 a.m., 24 January
1927. No subject. N.d. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to CAPT Randolph Ridgely, USCG. No subject. 4 February 1927. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Memorandum for Major Hamlin. Subject: “Mrs. Elizabeth Smith Friedman.” 22 April
1927. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Philip Hamlin. No subject. 3 June 1927. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to H. J. Anslinger. No subject. 10 October 1927. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Memorandum of Telephone Conversation Between CDR Root, Coast Guard Head-
quarters and Mr. Oftedal, stant Com joner of Prohibition, 10:00 a.m., 5 Janu-

81


Even the Coast Guard’s methods of obtaining information were kept secret. This
resulted in sometimes confrontational exchanges between officers of the Intelligence Sec-
tion and other enforcement officials who did not understand “the methods used by [the
Intelligence Section] in deciphering the messages of the blacks were developed by the
War Department and [were] considered strictly secret and confidential and [would] not
[be] revealed in any case to other than commissioned and combatant officers of the mili-
tary service[s].”!?

So concerned was Commandant Billard with protecting the Coast Guard’s intelligence
collection methods that when setting up the Intelligence Field Unit in New York, he
reminded LT Meals “not [to] divulge the modus operandi of the Intelligence Unit to other
than Coast Guard personnel” and ordered that in no case “will copies of solved codes, nor
information that a code has been solved, be given to other than responsible Coast Guard
personnel”! In 1930 and 1931, when the Coast Guard enjoyed much success in locating
and shutting down illegal shore-based amateur radio stations using portable HFDF equip-
ment, the credit was given to “other agencies” to hide the Coast Guard’s involvement and
protect the methods involved.'*

The Coast Guard was also very careful to ensure that those entrusted with intelligence
were of the highest moral character by subjecting all prospective civilian employees and
officers assigned to the Intelligence Section to “a most searching investigation of [their]
past connections and activities.”> By conducting thorough background investigations,
the Coast Guard was able to root out any potential liabilities from its intelligence net-
work.

COMMUNICATIONS SECURITY MEASURES AND
THEIR EFFECTIVENESS

At the headquarters of the Coast Guard very little information can be obtained
regarding either the plans or equipment of the government fleet. Every one
who asks questions is eyed with suspicion. Experience has taught Coast
Guard officials that spies may come cloaked as newspaper men, and that the

!? Clifford D. Feak, LTJG, USCG, letter to Commissioner of Prohibition, no subject,
1 February 1928,

'3 Commandant, U.S. Coast Guard, letter to Commander, Coast Guard Intelligence Unit, New
York, subject: “Intelligence Duty: Instructions,” 5 December 1930. This ws iter amended to allow
the furnishing of codes intercepted from the rum runners, as well as their solutions, to officers of the
Justice Department and the Customs Service for use in law enforcement activities. Commandant,
U.S. Coast Guard, letter to Commander, Coast Guard Intelligence Unit, New York, subject: “Intelli-
gence Duty; Instructions, Amendment of,” 7 January 1931.

‘4 Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Unlicensed
Radio Stations Used to Direct Smuggling Activities,” 24 October 1930.

'5 Charles S. Root, CDR, USCG, Intelligence Officer, letter to Chief Clerk, Coast Guard Head-
quarters, subject: “Clerical Assistance,” 3 February 1925.

53


Kern, Ralph D., Customs Agent. Letter to Commissioner of Customs. No subject. 5
November 1928. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Kielhorn, L. V., LCDR, USCG. Letter to CAPT William J. Wheeler, USCG. No subject. 3
December 1927. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Lee, Henry. How Dry We Were: Prohibition Revisited. Englewood Cliffs, New Jersey:
Prentice-Hall, Inc., 1963.

Library of Congress. LC Science Tracer Bullet: Cryptology. Washington, DC: Library of
Congress, 1997. ISSN 0090-5232, TB 96-2.

Lowell, Joan. Gal Reporter. New York: Fariar & Rinehart, Inc., Publishers, 1933.

Martinson, A. M. Letter to Commander, Florida East Coast Patrol Area. No subject. 1
May 1930. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Massey, W. J. Letter to Commander, New York Division. Subject: “Telephone Line Tam-
pering with.” 1 May 1924. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Mauerman, R. J., Assistant Communication Officer. Letter to Night Decode Officers. Sub-
ject: “Instructions to Night Decode Officers.” N.d. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Meals, Frank M., LT, USCG. Letter to Commandant, U.S. Coast Guard. Subject: “Major
William F. Friedman, U.S.A.; Services Rendered by.” 30 September 1930. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Group 2; Code Seized.” 24 Janu-
ary 1931. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Use of Monitor by Radio Electri-
cians W. B. Dawson and H. M. Anthony in the Location of Rummy Radio Station at
25 Hull Avenue, Grant City, Staten Island.” 16 March 1931. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Raiding of Group 6 Radio Sta-
tion, 98 Austin Street, New Bedford, Mass.” 22 March 1931. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.



Other Books from the Joint Military College

Pickert, Perry L. — Jntelligence for Multilateral Decision and Action. Fd. Russell G. Swenson
Washington, DIC: JMIC, 1997. ISBN 0-9656193-0-8.

Clif, Denis A. — Clift Netes. Ed. James §. Major. Washington, DC: IMIC, 2000.
ISBN 0-9656195-2-4.


“St. Pierre and Miquelon,” Central Intelligence Agency Fact Book. URL: <http: /Avww.
odci.gov/cia/publications/factbook/country-frame.html>. Accessed 1 June 1998.

Tilley, John A. Coast Guard Vessels of the Prohibition Era. Unpublished research paper.
N.d. Copy obtained from the Coast Guard Historian’s Office, Washington, DC.

Treasury Department. Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1920. Washington, DC: GPO, 1920. 2871.
Coast Guard Historian's Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1921, Washington, DC: GPO, 1922. 2898. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1922. Washington, DC: GPO, 1922. 2912. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1923. Washington, DC: GPO, 1923. 2925. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1924. Washington, DC: GPO, 1924. 2940. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1925. Washington, DC: GPO, 1925. 2954. Coast Guard
Historian's Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1926. Washington, DC: GPO, 1926. 2970. Coast Guard
Historian's Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1927. Washington, DC: GPO, 1927. 2984. Coast Guard
Historian's Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1928. Washington, DC: GPO, 1928. 2995. Coast Guard
Historian’s Office, Washington, DC.

Annual Report of the Secretary of the Treasury on The State of the Finances for the
Fiscal Year Ended June 30 1929. Washington, DC: GPO, 1929. 3009. Coast Guard
Historian's Office, Washington, DC.


AUTHOR’S BIOGRAPHY

LT Ensign entered the U.S. Navy in 1981, serving first as a Korean linguist, then
becoming responsible for developing training materials for Navy linguists worldwide.
Following his graduation from University College of the University of Maryland in 1990,
he received a commission in the U.S. Coast Guard. His early years as a Coast Guard
officer were spent in Key West, Florida, where he was responsible for
for U.S. counterdrug efforts in the Caribbean, Atlantic and Eastem Pi 5
tour at Sault Ste. Marie, Michigan exposed LT Ensign to other Coast Guard
as Search-and-Rescue, Ice-Breaking and Maritime Law Enforcement. In 1998, LT Ensign
graduated from the Joint Military Intelligence College. His thesis, “Intelligence in the
Rum War at Sea, 1920-1933,” received the Joint Chiefs of Staff Joint History Office’s
Award for Excellence in Archival Research. He currently serves in the Pacific Area Head-
quarters at Alameda, California as Chief of the Operational Intelligence Branch. LT
Ensign has been awarded the Joint Service Commendation medal and the Coast Guard
Achievement Medal.

.


personnel strength was reduced by 170 temporary warrant officers and 1,600 enlisted
men, with further reductions in subsequent years.’ The Coast Guard continued, how-
ever, to enforce the maritime laws of the United States well beyond Prohibition, a mis-
sion that continues to characterize the Service even today.

COAST GUARD OPERATIONS IN THE WANING YEARS

As happens in most wars, the end of Prohibition came at a time when the Coast
Guard was clearly in command of the battlefield. By the early 1930s, the Coast Guard
had refined its anti-smuggling operations to the point where smugglers were forced to
move their operations frequently, transiting from front to front, never gaining an effec-
tive stronghold anywhere along the U.S. coastline. The liquor assault that began with
blatant law-breaking in plain view of enforcement officials along New York’s Rum
Row had been reduced to risky clandestine rendezvous, sometimes effected hundreds
of miles offshore in attempts to evade Coast Guard defenses. As the Coast Guard’s
anti-smuggling campaign advanced on the Pacific and Atlantic Coasts, in the early
1930s the emphasis on liquor smuggling shifted to the Great Lakes, Gulf Coast, and
Eastern Coast of Florida.? The Coast Guard responded in kind by reinforcing defenses
in the affected regions with personnel, vessels, and intelligence collection assets
including a Fort Lauderdale-based “undercover force” to combat the ever-present
threat of corruption.!°

In the waning years of Prohibition, the Coast Guard planned several new initiatives to
help it maintain information dominance over the rum syndicates. The first of these
included expanding the intelligence unit concept to all Divisions and Patrol Forces to
“make the information obtained [through] intelligence ... immediately available to [every]
officer in charge,” giving the Coast Guard a “complete intelligence organization.”!! The
plan included stationing two officers and eight enlisted men each at six to eight additional
Intelligence Units, but was precluded by the repeal of the 18th amendment before it could
be put into action.!

7 Willoughby, 160-161.

8 U.S. Coast Guard, Biography for Prohibition Era Commandants.

° Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Cruising of
Patrol Boats,” 23 March 1929.

'° William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Inclosed Letters from Commanders Jones and Jack,” 2 January 1929.

‘! Commandant, U.S. Coast Guard, letter to Commander, New York Division, subje
Intelligence Units: Establishment and Operation of,” 1 December 1930, 2.

2 Unidentified correspondent, transcript of Mr. Watson’s discussion with LCDR Gorman in San
Francisco, no subject, 19 January 1931, 2.

Field


inspection. At the time, /’m Alone was flying a Canadian flag, which prompted some mem-
bers of the Canadian Parliament to claim the attack was an act of war. Through the decryp-
tion of radio traffic known to have been sent from /’m Alone, Mrs. Friedman was able to
prove the vessel had American owners and was flying a Canadian flag under false pre-
tenses. This blunted Canadian claims that their sovereignty had been violated and saved the
U.S. hundreds of thousands of dollars in restitution payments.'”

With the value of COMINT to the battle for information superiority now irrefutably evi-
dent, in late 1930 the Coast Guard set up a satellite intelligence office in New York City,
again under the command of LT Meals.” In his orders establishing the new unit, Comman-
dant Billard indicated the time has come for “the practical application of ... intelligence, ...
[to be used] as a valuable aid to patrol forces engaged in the prevention of smuggling.”!"!
This released Headquarters from its respo: lity for central control over all intelligence
activities and empowered the first field unit in the Coast Guard to do intelligence work. It
was also necessary as Headquarters in its own right was swamped with the increasing
amount of COMINT information pouring in from all directions. The New York Intelligence
Unit was tasked with providing intelligence support to the units of the Eastern, New York,
and Norfolk Divisions, and the Destroyer Force.'!? To do this, three additional six-bitters,
including CG-131, CG-214, and CG-141, were equipped with special high-frequency
receivers and HFDF equipment like their predecessor, CG-210.'"> Additionally, the Unit
was staffed with eleven officers and 45 enlisted men, performing rudimentary cryptanalysis.
and providing time-sensitive COMINT-derived information to the anti-smuggling fleet.!!*
By early 1931, the New York Unit had been designated as the official “training base” for
Coast Guard intelligence officers, with the intention of training enough personnel to com-
mission like units on the U.S. Pacific and Gulf Coasts.''> This was realized in the fall of
1931," as an officer, cryptanalyst, and six radiomen each, in specially equipped patrol
boats,!!” were sent to Mobile and San Francisco.!'* With three regional intelligence offices
in operation, the Headquarters cryptanalysis staff could now concentrate its efforts on
“codes too complex for the field officers to solve.”'!9 To ensure proper oversight of the

‘Kahn, 814-815.

"Commandant, U.S. Coast Guard, 5 December 1930, 1.

‘!\Commandant, U.S. Coast Guard, letter to Commander, New York Division, subject: “Field
Intelligence Units: Establishment and Operation of,” 1 December 1930, 1. Included in Appendix A.

12Commandant, U.S. Coast Guard, 5 December 1930, 1.

'3Commandant, U.S. Coast Guard, 1 December 1930, 2.

'4Unidentified correspondent, transcript of LCDR Gorman’s remarks following Admiral Bil-
lard’s speech, no subject, n.d., 2.

''5Unidentified correspondent, transcript of Mr. Watson’s discussion with LCDR Gorman in San
Francisco, no subject, 19 January 1931, 1.

"Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Radio-Intelli-
gence; Operation of Unlicensed High-Frequency Radio Transmitter in Gulf Division,”
16 December 1930, 2.

‘Unidentified correspondent, 19 January 1931, 1.

‘'8Commandant, U.S. Coast Guard, 14 April 1932.

"Commandant, U.S. Coast Guard, 1 December 1930, 3.

33


Dempwolf, R. W. Letter to CDR Charles S. Root, USCG. No subject. 15 November 1926.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

De Otte, D. F. A., Commander, California Division. Letter to Commandant, U.S. Coast
Guard. Subj “Patrol System.” 26 May 1924. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Code “F’; Standard “Squared
Chart” for California Division.” 29 January 1929. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Department of State. Paraphrase of a telegram received from the American Consul Gen-
eral at Halifax, Nova Scotia. No subject. 26 June 1925. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Record of a telephone call from the American Consulate at Nassau, Bahamas, dated
19 January 1928. No subject. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
DC.

Director of Naval Communications. Letter to Secretary of the Navy. Subject: “Coast
Guard.” 21 January 1931. Records of the National Security Agency, Central Security
Office, Record Group 457; National Archives Building, Washington, DC.

Dowling, Thomas E., FS-01, State Department. Intelligence in the Final Indian Wars,
1866-1887. MSSI Thesis. Washington, DC: Joint Military Intelligence College, Sep-
tember 1996.

Edmonds, S. P., Commander, Base Fifteen. Letter to Commandant, U.S. Coast Guard.
Subject: “Radio Receiving Set, Br. Schr. Varuna.” 7 December 1925. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Espionage, Intelligence, and International Policy. Vol I. Ed. Mr. Kenneth M. Absher.
Washington, DC: Joint Military Intelligence College, 1998, 3.

Farago, Ladislas. The Broken Seal: Operation Magic and the Secret Road to Pearl Har-
bor. New York: Random House, 1967.

Feak, Clifford D., LTJG, USCG. Letter to Commissioner of Prohil
1 February 1928. Records of the Coast Guard Intelligence Di
Record Group 26, Entry 297; National Archives Building, Washington, DC.

4


Coast Guard’s new coast-to-coast intelligence network, the Headquarters cryptanalyst staff
was boosted from two to seven personnel in July 1931.'° This rounded out the Coast
Guard’s COMINT collection strategy for the remaining years of Prohibition.

Imagery Intelligence

In the summer of 1924, the Coast Guard received a report of submarines being used to
smuggle liquor into New York via the Hudson River.'?! With no air capability of its own,
the Coast Guard obtained the assistance of the Fairchild Aerial Camera Corporation in
locating and photographing the suspected rum runners. ? A resulting photograph, taken
at an altitude of 5,000 feet, showed two subsurface craft, each approximately 100 feet in
length, transiting the Hudson River.!?> While it was never proved that these craft were
involved in the illegal rum trade, the use of aerial photography in this instance marked the
Coast Guard’s first use of IMINT as an means of acquiring DBK in the Rum War at Sea.

Figure 11. Suspected Rum-Running
Submarines.

Source: U.S. Coast Guard, “Submarines,
Possible Use for Smuggling,” photograph
(Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26,
Entry 297; National Archives Building,
Washington, DC: 1924).

As more appropriations for the enforcement of the Prohibition laws became available,
the Coast Guard expanded its IMINT program by establishing an air station at Gloucester,
Massachusetts.'?4 With the arrival of the Coast Guard’s first seaplane in October 1926, the
Coast Guard now had the capability to scout “over sea areas off the New England and

'20Coast Guard appropriations for fiscal year 1931 included annual salaries of $4,000 for a cryp-
tanalyst-in-charge, $2,000 for an assistant cryptanalyst, $2,000 for a senior cryptographic clerk,
$1,800 for a cryptographic clerk, and $1,620 each for three assistant cryptographic clerks to be
employed at Headquarters. Kahn, 807.

'21Commandant, U.S. Coast Guard, letter to Chief, U.S. Army Air Service, subject: “Request for
Aerial Photographs,” 29 July 1924.

'2W. V. E. Jacobs, Commander, New York Division, letter to Commandant, U.S. Coast Guard,
subject: “Submarines, Possible Use for Smuggling,” 14 July 1924.

!3W, V. E. Jacobs, 14 July 1924.

'4U §, Coast Guard, Biography for Prohibition Era Commandants William E. Reynolds, Fre-
drick G, Billard, and Harry G. Hamlet, no subject, n.d.

34


To make locating illicit communications platforms more difficult for the Coast Guard,
the rum syndicates also employed a “broadcasting truck” which traveled up and down the
Atlantic Coast broadcasting orders to rum-runners lying offshore.”

Though the rum syndicates used these and other counterintelligence tactics to protect
their communications from the Coast Guard’s anti-smuggling fleet, by all accounts, they
were rarely successful. That these methods were in fact known by the Coast Guard indi-
cates the rum fleet’s failure to keep their counterintelligence efforts secret.

The rum syndicates also employed various deception techniques in attempts to evade
the Coast Guard’s intelligence web. One of the most common tactics was to designate an
unloaded known rum-running vessel and allow a Coast Guard cutter to picket it while
other loaded rum ships secretly effected their planned rendezvous.”* This often worked,
but when it did not rum runners were known to have seaplanes drop flares to light up the
night sky so that high speed contact boats could make their way around Coast Guard
patrols on their way to and from shore.2?

Another common means of deception involved the use of fish, ice, lumber, coal, and
sand to conceal liquor placed in the bottom of cargo holds.” Otherwise legitimate fisher-
men would sail out to sea 150 miles or more and rendezvous with rum-laden mother:
ships. Once they had placed their newly acquired liquor cargo in the bottom of their fish
holds, the fishermen would sail to known fishing grounds and simply “go fishing until suf-
ficient respectability [had] been gathered to cover the contraband:? This not only
allowed the fishermen to engage in their legal profession, but it also lessened suspicion
from the Coast Guard as the vessels involved had been legitimately fishing for several
days when making their way back into port.

Other vessels and even some automobiles used false bottoms, appendages, and other
concealment measures to “run the rum in.” On the Gulf Coast and the East Coast of
Florida, rum runners disguised as tourists would pick up liquor loads from ships east of
Mobile and conceal the liquor in automobiles specially designed with false bottoms for

> E, T. Osborn, Officer-in-Charge, Coast Guard Station Lite Beach, letter to Commander, Fifth
District, subject: “Use of a Radio Broadcasting Motor Truck by Smugglers; Report of”
29 July 1931.

6 Commander, Destroyer Division Two, letter to Commandant, U.S. Coast Guard, subject:
“Concentration Charts,” 14 August 1932.

7 Commander, Base Four, letter to Commandant, U.S. Coast Guard, subject: “Flares, Use of by
Rum Runners from Planes,” 2 November 1932.

8 Mabel W. Willebrant, Assistant U.S. Attorney General, letter to Commandant, U.S. Coast
Guard, no subject, 15 July 1925.

* Charles S. Root, CDR, USCG, Intelligence Officer, letter to Commandant, U.S. Coast Guard,
subject: “Patrol Areas,” 9 December 1926.

* William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Proposed Letter to All Units Except the Destroyer Force, Regarding Use of False
Bottoms, etc..” 19 April 1930.

49


LCDR F. J. Gorman, credited five undercover agents working in Cuba since 1925 with
“practically [bottling] up Cuba as a smuggling base.”??

Although the Coast Guard launched a wholehearted HUMINT collection effort within
its own ranks, it also relied heavily on “other sources,” most of whom were simply
informers who had no sympathy with the rum runners.”” Most of the information received
from informers pertained to large “mother-ships” departing foreign ports laden with
liquor, and it included such details as “names, types, and quantity of contraband, time of
departure, and destin, ions.”>! As an example, in January 1924 the Coast Guard received
a report about the vessel Butetown’s dispatching liquor to contact boats off Rum Row. The
report not only gave the rum-runner’s name, but also the destination, timeframe, cargo,
and information on the master’s financial status, indicating he would go bankrupt if he
could not unload his cargo in a very short time.*?

Anonymous HUMINT was not limited to information concerning vessels loaded with
liquor. In August 1924, the Coast Guard received a report of a seaplane working with the
rum fleet. The plane’s name and guishing characteristics were reported to Coast
Guard headquarters where the information was disseminated to Coast Guard units in the
seaplane’s operating area.**

To ensure informers were tapped for all information they were capable of providing,
the Coast Guard occasionally placed informers onboard Coast Guard vessels during rou-
tine patrols to assist in the identification of blacks.’ Although in most cases informers
were reliable, this was not always the case. In 1928 the Coast Guard received a report that
a “reliable” informer on Florida’s West Coast was in fact a double agent, responsible for
limiting the Coast Guard’s success to the seizure of “only one or two boats on the West

Coast of Florida in a period of some years.”>>

°° Five undercover agents in Cuba were maintained by the Prohibition Bureau from 1925 at a cost
of $1,000 to $1,500 a month. They operated in exclusive support of anti-smuggling intelligence col-
lection for the Coast Guard. In 1930, when the Prohibition Bureau was transferred to the Department
of Justice, the undercover agents were “taken up on the pay-rolls” of the Customs Service, but
remained operatives of the Coast Guard Intelligence Section. F. J. Gorman, LCDR, USCG, Intelli-
gence Officer, letter to CAPT Chiswell, USCG, subject: “Travel Order,” 11 March 1931, 3.

3° Malcom F. Willoughby, CDR, USCGR(T), Rum War at Sea (Washington, DC: GPO, 1964),
107.
31 Willoughby, 107.
* Unidentified correspondent, letter to Roy A. Haines, Federal Prohibition Commissioner, no
subject, 18 January 1924.

* James S. Baker, Officer in Charge, Bellport Station, letter to Superintendent, Fourth District,
subject: “Seaplane, Working with Rum Fleet,” 21 August 1924.

*4 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Report of Special Narragansett Patrol, 24 March to 7 April, 1930," n.d.

35 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Notes Taken From Mr. Owens of Foreign Control Section, Prohibition Service,
March 28, 1928,” 29 March 1928.

22


In addition to protecting Coast Guard operational plans and intentions, secrecy also
extended to the protection of information gained by the Coast Guard in the accom-
plishment of its mission. To show the Coast Guard’s resolve that intelligence informa-
tion be kept in approved channels, the Assistant Secretary of the Treasury responded to
a 1925 request from the British Consul General in New York City for the names of ves-
sels loitering on Rum Row with the opinion that “information of this character should
be kept secret, in order to hamper, as much as possible, communication between liquor
peddlers at sea and their confederates on shore.” Secrecy was especially important in
protecting the Intelligence Section’s s in decrypting enemy codes and ciphers.
In a letter to the Commander, Gulf Division, the Commandant stressed that “[t]he
importance of secrecy in connection with radio intelligence cannot be over emphasized
as, if it becomes known that the Coast Guard is in po ’s code,

ion of a rum-runner’s

the code will be immediately changed and the work of solution must be done all over
and

again.

OPSEC guidelines for protecting intelligence were routinely followed in preparing
operational Coast Guard correspondence. Reports considered confidential were prepared
in accordance with Article 2422 of Coast Guard Regulations, which stipulated means for
sending classified material.° Examples of confidential correspondence included weekly
reports of operations sent to Headquarters by ships of the anti-smuggling fleet,” inter-
cepted radio traffic sent for decryption by the Intelligence Section,’ and Coast Guard
Intelligence Circulars.? To further protect Intelligence Circulars, eventually only commis-
sioned officers were allowed to read them.!° Additionally, beginning in 1927, Circulars
over six months old were destroyed by burning.'!

+ L.C. Andrews, Assistant Secretary of the Treasury, letter to Secretary of State, no subject,
17 March 1925.

5 Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Radio-Intelli-
gence; Interception of Rum-Runner’s Radio Traffic.” 11 June 1931.

© One of the most common ways of sending classified correspondence between Coast Guard
Headquarters and field units was via registered mail. The Coast Guard also instituted a “return
receipt” system to ensure accountability for classified correspondence. H. F. Schoenborn, LCDR,
USGG, letter to Radio Gunner Robert W. Finley, no subject, 28 April 1925. Also see, Commandant,
U.S. Coast Guard, letter to Commanders of Section Bases, Squadrons and Divisions of Offshore
Patrol Forces, and Officers in Charge of other Patrol Boat Groups, subject: “Confidential Reports of
Operations.” 26 January 1928.

7 Commandant, U.S. Coast Guard, 26 January 1928.

5 Commandant, U.S. Coast Guard, letter to Commanding Officer CHELAN, subject: “Instrue-
tions for Transmitting Intercepted Messages to Headquarters by Cipher.” 14 April 1932.

© Commandant, U.S. Coast Guard, letter to All Coast Guard District Superintendents, subject:
“Intelligence Circulars,” 21 February 1924.

10 §.R. Sands, Fourth District Superintendent, letter to Commandant, U.S. Coast Guard, sub-
ject: “Intelligence Office Circular No. 519,” 11 November 1925.

‘| J, L. Ahern, Commanding Officer, PORTER, letter to Commandant, U.S. Coast Guard, sub-
ject: “Destruction of Confidential Papers,” 16 September 1927.

52


The Coast Guard also instituted plans to further increase its enforcement assets. With
several destroyers decommissioned and returned to the Navy in 1930 and 1931,'> the
Coast Guard planned the construction of eighteen 165-foot patrol boats, with a cruising
range of 6,000 miles at 12 knots.'4 In 1932 the first seven of the new 165-foot patrol boats
were placed in service.'° Two more followed in 1933 '° with the remaining nine built after
the end of Prohibition.'’ Headquarters’ plans to organize the new 165-foot vessels into
“one self-sustaining, mobile Special Patrol Force” never fully materialized as the program
was preempted by the abrupt end of Prohibition.'* Instead, beginning in 1934, the 165-
foot patrol boats were converted into submarine chasers to provide for maritime defense
in the years after Prohibition.’

Probably the most aggressive measure the Coast Guard contemplated to combat smug-
gling in the 1930s was the enhancement of its IMINT capability through the planned pur-
chase of 19 additional aircraft. In the last years of Prohibition the Coast Guard established
air patrol detachments at Buffalo, New York; San Antonio, Texas; and San Diego, Califor-
nia, to combat smuggling from Canada and Mexico. Six aircraft were transferred from the
Navy to the Coast Guard for this purpose, in addition to the 19 already budgeted for °° The
Coast Guard Air Service was essentially the only Prohibition-era Coast Guard initiative to
survive the repeal action. In early 1934, just months after the nation was officially “wet”
again, the Secretary of the Treasury, Henry Morgenthau, consolidated all Treasury Depart-
ment air assets under the Coast Guard’s air arm.”! This included the transfer of 15 various
aircraft from the Customs Service and gave the Coast Guard a major air mission which was
expanded to cover its primary mandate of search and rescue at sea. To this end, contracts for
the planned 19 aircraft, ten Douglas and nine Grumman amphibian airplanes, were awarded

5 By the summer of 1931, thirteen of the original 25 destroyers obtained from the Navy had
outlived their usefulness and were returned. These vessels included: Ammen, Beale, Burrows,
Downes, Fanning, Henley, Jouett, McCall, Monaghan, Patterson, Paulding, Roe, and Terry. They
were replaced with five additional destroyers from the Navy including: George E. Badger, Herndon,
Hunt, Welborn C. Wood, and Able P. Upshur. Treasury Department, Annual Report of the Secretary
of the Treasury on The State of the Finances for the Fiscal Year Ended June 30 1931 (Washington,
DC: GPO, 1932), 152-153. In 1932, a sixth destroyer, Semmes, was added to help bridge the gap
left by those destroyers having been decommissioned. Donald L. Canney, U.S. Coast Guard and
Revenue Cutters, 1790-1935 (Washington, DC: U.S. Coast Guard, 1995), 106.

' Hugh Garling, “The United States Coast Guard: Part II,” Nautical Magazine 247, no. 2 (Feb-
ruary 1992): 105.

5 ‘Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1932 (Washington, DC: GPO, 1932), 129-130.

‘6 Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1934 (Washington, DC: GPO, 1935), 79.

"7 John A. Tilley, Coast Guard Vessels of the Prohibition Era, unpublished research paper, n.d.

‘8 Commandant, U.S. Coast Guard, letter to Commander, Destroyer Force, subject: “Policy in
Re-Operation of New 165-ft. Patrol Boats,” 16 December 1931.

© Tilley, Coast Guard Vessels of the Prohibition Era.

> ‘Treasury Department, Annual Report for 1934, 80.

2! ' U.S. Coast Guard, Biography for Prohibition Era Commandants,

61


INTELLIGENCE IN THE RUM
WAR AT SEA, 1920-1933

Contents

Introduction, by Admiral Robert E. Kramek . .

Chapter 1. The Coast Guard and the Onset of Prohibition

Scope of the Problem Facing the Coast Guard,
Coast Guard Organization at the Beginning of the Rum War,

Chapter 2. Rising to the Occasion: Initial Measures to Combat the
Rum-Rummers... 0... 06. eee eee eee ee teen ee tee eee ee eee 7

Coast Guard Enlargement Through Vessel Acquisition and Recruitment,
Other Measures to Even the Score,

The Effectiveness of Early Efforts Against Rum-Running,

Chapter 3. Intelligence As a Force Multiplier . .

Organization and Early Operation of the Coast Guard Intelligence Section,
Evolution of Intelligence Disciplines Within the Coast Guard,
Inter-Agency Cooperation and Intelligence Sharing,

All-Source Intelligence Support to the Fleet.

Chapter 4. Rum-Runners’ Use of Intelligence and Counterintelligence ........... 45

Intelligence Collection Against the Coast Guard,
Counterintelligence Tactics and Deception Techniques,

Chapter 5. The Coast Guard’s Counterintelligence Strategy.......-....-2-22055 51

Operations Security Measures and Their Effectiveness,
Communications Security Measures and Their Effectiveness,

Chapter 6. The Coast Guard and the End of Prohibition ...................05. 59

Coast Guard Operations in the Waning Years,
Winning the Rum War with Intelligence,

Appendix... 2.0.0 cece cece ene ee cece eee eee e cence eee neeeeeeeeeees 65
Bibliography ........0..c0ccecececececeecevececeseesesreeevesesese 67


ligence to the fleet in a timely and useful manner, and finally, incorporate feedback oe
from the fleet into creating better finished products.' The chief result of this process was
the Intelligence Office Circular, mailed under confidential cover to front-line Coast Guard
forces approximately three times a week. The stated goal of the Intelligence Circular was
to “improve the efficiency of Service operations by publishing such condensed informa-
tion as will permit Force Commanders to correctly estimate the current situation and act
accordingly."!* By the summer of 1928, nearly 1,000 Intelligence Circulars had been
issued by the Intelligence Section, each issue comprising approximately 200 copies.

Even as Intelligence Circulars provided useful general information related to rum running,
they were often “amplified by special communications by mail, telegraph, or telephone when.
deemed necessary.”!° In providing this additional information, each cutter was assigned a
patrol sector based on intelligence. Cutters were then given the names of rum-runners in their
sector and other pertinent information such as each rum-runner’s port of registry, cargoes, ton-
nage, the length of time the rum-runner had been in the area, when transfers might be effected,
information on the ship’s owners, and the name and owners of contact boats expected to ren-

dezvous with the rum-runner.' Intelligence Circulars were also amplified by the dissemina-

16 ensure Headquarters maintained a “comprehensive picture of the current activities” Com-
mandant Billard required each patrol boat to submit weekly reports detailing the “results of all
activities, any information or ramors indicating present or prospective smuggling activities with
actions taken or proposed to combat same, and, in general, all items of importance or interest per-
taining to the objects of the patrol, together with such recommendations or plans as may be thought
appropriate.” Commandant, U.S. Coast Guard, letter to Commanders of Section Bases, Squadrons
and Divisions of Offshore Patrol Forces, and Officers in Charge of other Patrol Boat Groups, sub-
ject: “Confidential Reports of Operations,” 26 January 1928.

163Bach of the steps listed are part of the “Intelligence Process.” Needs indicates the require-
ments of the policymakers; collection includes the gathering of raw data for use in producing fin-
ished intelligence; processing and exploitation refer to converting large amounts of data to a form
suitable for producing finished intelligence and include translating and decrypting data; analysis
and production is the “integration, evaluation, and analysis of all available data” into usable intelli-
gence products; dissemination refers to delivering finished products to the customer; and feedback
refers to interacting with the customer to help identify intelligence gaps so that intelligence produc-
ers can “focus more precisely on customer needs.” CIA, Consumer's Guide, 1.

‘oKCharles S. Root, 9 August 1928, 4,

‘Charles S. Root, 9 August 1928, 4.

166Waters, Smugglers of Spirits, 66.

a


liquor to the US." The Department of Justice regularly investigated Coastguardsmen
accused of conspiring with the rum runners as well as some rum runners who occasion-
ally tried to impersonate Coastguardsmen to gain pertinent information.'"” The War
Department supplied the Coast Guard with cipher devices to encrypt its own communica-
tions '* as well as cryptographic training literature for the Coast Guard’s use in building
an effective cryptanalysis unit at Headquarters.'” The Prohibition Bureau worked hand-
in-hand with the Coast Guard in intercepting and decrypting illicit radio traffic and also in
running informants along the Northwest U.S. Coast and in British Columbia.'® So effec
tive was this relationship that from 1926 to 1927, liquor shipments from Victoria, Britis
Columbia, were reduced by 50 percent.!*! During the same timeframe, ship clearances
from Vancouver, British Columbia, decreased over 70 percent, from 137,960 to 37,647.!°?
Finally, the Customs Service provided assistance in intercepting encrypted radio traffic
off the Florida and Gulf Coasts for forwarding to Coast Guard Headquarters.'>> The Coast
Guard and Customs also exchanged Intelligence Circulars and Weekly Intelligence Bulle-
tins '* as a means of providing their front line forces with the most current intelligence
available to either organization.'*> To solidify the working relationship between the Coast
Guard and Customs, in the spring of 1931, LCDR Gorman accompanied two Customs
Commissioners on a 10-day inspection of Customs and Coast Guard units operating in
Florida and Cuba.'°°

So successful were the cooperative efforts in intelligence sharing among federal agen-
cies that in 1928 the Coast Guard Commandant put forth a decision that:

‘46Department of State, 26 June 1925. Also see Secretary of State, 12 April 1924, and Secretary
of State, 14 April 1924.

147Bennet Sanderson, Assistant U.S. Attomey, letter to CDR Charles S. Root, USCG, no subject,
4 January 1926.

'48Secretary of War, letter to Secretary of the Treasury, no subject, 8 April 1924.

‘Commandant, U.S. Coast Guard, letter to Ensign L. T. Jones, subject: “Cryptographic Litera-
ture,” 31 July 1931.

‘Ralph R. Read, Supervising Agent, letter to Seymour Lowman, Assistant Secretary of the
Treasury, no subject, 9 April 1928, 3-5.

'S!Figures provided by the American Consul General at Vancouver show a decrease from 14,275
cases of liquor exported from Victoria in 1926 to 7,145 cases exported in 1927. Ralph R. Read,

9 April 1928, 5.

'SRalph R. Read, 9 April 1928, 5-6.

‘Ralph D. Kern, Customs Agent, letter to Commissioner of Customs, no subject,
5 November 1928.

'4Customs’ Weekly Intelligence Bulletins provided “current general and specific information
relating to smuggling of every character” to Customs officers to “acquaint [them] with the move-
ments of vessels, vehicles, and individuals engaged in smuggling ... [and] to enable the officers in
each district to be informed of the preventive activities and seizures in other districts.” Commis-
sioner of Customs, Bureau of Customs, letter to Commandant, U.S. Coast Guard, no subject, 10
February 1931.

‘Commandant, U.S. Coast Guard, letter to Commissioner of Customs, Bureau of Customs, no
subject, 14 February 1931.

‘SR, J. Gorman, 11 March 1931, 1.



APPENDIX: A KEY HISTORICAL DOCUMENT

1 a CoMONNT. UE TOUT cu

norton 601-64
TREASURY DEPARTMENT

UNITED STATES COAST GUARD

WASHINGTON =.
HEADQUARTERS:

2 April 25, 1024.5

Qo tho Officers in Chargo end Porsonnel of Const Guard Stations:

The Const Guard is about to bo morph ere for law onforce-
mont work, and as soon as we heve obtained tho additional per-
sonnel and equipment as planod, the Service will be held ros-

onsible in tho task of koo: “liquor from boing landed on
the coasts of the United States.

Noithor tho old Rovenuo-Cutter Service nor the old Iife-

Seane cere ne ueene Sal rea ie aae ety von it to do. The
Const Oyard hes never feficd, it will not feil in its
perfomence of this big task.

You mon at the stations have guarded the Coosts in pro~
teoting and succoring life end property foithfully and well,
and you mst continue to so guerd them because that romains
ib most important duty. But now in eddition you must guard

coosts against the importation of liquor which is a
Violation of the Constitution of the United States that wo have
all sworn to defend. It is not for us in tho Const Guard to-
seeetice the wisdom of any law or order; it is for us to obey,

thfully and loysliy,

There will shortly be aveilable 2 forco a@ ships and
patrol boats to keep the enomy (the rum runners) from reaching
the coast. You mon ero the least lino of defense. It is for
you to seo that no rum runnor that has oluded our patrol craft
danda on the beach or enters an inlot. You will heave an
Amportent part to play in this werfere on those who violato
the sovercign laws of the United Staton.

You mon who are et stations in or near commnitios whoro
rum running La provelont will doubtlosas be subjected to oll
sorts of insidious propngande ond influences and, indeod,
attempts may bo mado even to bribo you. Fey no attention
whatevor to propaganda or telk intended to injuro your moralo,
and if ony man attompts to bribo you, treat him imodiately
as you would en tp who has Soceely insulted you. I intond to
have £¢ Imown e@long our coasts that any ono who has an iden
he can bribe or seduce & member of tho United States Coost Guard
in the performance of his duty is the biggest kind of e fool.

65



nor the old Life-Saving Service ever failed in any duty given it to do, and it will not fail in
its performance of this big task.”!? Commandant Billard clearly laid out the Coast Guard's
course for his tenure as Commandant—to stop the flow of liquor into the U.S. by sea.

RADM Billard’s first move was to acquire and recondition the 20 destroyers promised
from the Navy. The destroyers were in various stages of disrepair, having been used hard in
World War I.'° To ensure the Coast Guard received the most seaworthy of the destroyers
available, a board of five engineering officers was designated to oversee the selection and
reconditioning process.'* The board quickly chose 19 destroyers at the Philadelphia Navy
Yard and one at the New York Navy Yard and began refurbishment.'> Two other Naval ves-
sels, a mine-sweeper and a sea-going tug, were also given to the Coast Guard to be employed
in law enforcement. These two vessels were refurbished at the Norfolk Navy Yard, where
they were laid up.'® By the summer of 1925, all 22 vessels had been reconditioned and were
placed in service.!’ Five more destroyers were provided by the Navy over the next year,
bringing the total number of destroyers employed by the Coast Guard to 25 by 1926.'*

Figure 2. Destroyers Converted for Coast
Guard Use.

Source: U.S. Coast Guard, “Destroyers Assigned
to the Coast Guard,”

photograph (Coast Guard Historian's Office,
Washington, DC: circa 1925).

‘2 Commandant, U.S. Coast Guard, letter to the Officers in Charge and Personnel of Coast
Guard Stations, no subject, 25 April 1924. See Appendix.

3 ‘The destroyers burned oil, using steam turbines for propulsion. They could steam at speeds
ranging from 26 to 30 knots maximum. Each vessel was equipped with its wartime main battery of
three- and four-inch and 50 caliber guns. Additionally, each destroyer was mounted with a one-
pounder quick-firing gun and various small arms. Harold Waters, Smugglers of Spirits: Prohibition
and the Coast Guard Patrol (New York: Hastings House, Publishers, 1971), 58.

'4 Willoughby, 47.

'S $5. Yeandle, Aide to Commandant, U.S. Coast Guard, compilation of Coast Guard Efforts to
Combat Rum-Running, no subject, n.d., 6.

'© S'S. Yeandle, compilation, 6.

‘7 Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1925 (Washington, DC: GPO, 1925), 422.

18 Willoughby, 48-49.



Chapter 5
THE COAST GUARD'S COUNTERINTELLIGENCE STRATEGY

To keep operational plans and intelligence collection methods out of the prying hands
of the rum runners, the Coast Guard applied highly disciplined OPSEC and COMSEC
measures to its daily operations. The combined effort to protect both operations and c
munications occasionally blurred the lines between OPSEC and COMSEC pract
However, the blending of counterintelligence methods allowed the Coast Guard to deny
the enemy the use of information which would have been helpful in skirting the Coast
Guard's enforcement effort. Although the two counterintelligence disciplines are divided
here for clarity, in practice OPSEC and COMSEC were employed in concert, as a single
strategy to attain a shared goal—denial of useful information to the enemy.

OPERATIONS SECURITY MEASURES AND
THEIR EFFECTIVENESS

In July 1924, when Commandant Billard laid out the Coast Guard’s Doctrine for Pre-
vention of Smuggling, he foresaw the need for secrecy in day-to-day Coast Guard opera-
tions, telling those at the forefront of the enforcement effort:

[d]o not give out any information regarding what is being done or to be done.
Refer all newspaper men and others seeking information about our activities to
Headquarters. Carefully avoid discussions of or prognostications about what
the Coast Guard intends to accomplish. We are not saying what we are going to
do. When the job is done will be the time to give publicity—not before.!

This set the stage for a determined effort by the Coast Guard to protect details of its
operations from those who stood to benefit from such knowledge. This was particularly
important with respect to the opponent, and was reinforced by a second Commandant
directive, also issued in July 1924, reminding members of the Coast Guard that
“{c]ommunication with the enemy, whereby he may obtain any information whatever, is
forbidden.”? Keeping Coast Guard intentions out of the press was also a major security
concern, evidenced by the Commandant’s third directive, issued in August 1924, that “no
officer give an interview to the press relative to the enlargement program of the Coast

Guard except by specific authority first obtained from Headquarters.”>

' U.S. Coast Guard, Doctrine for Prevention of Smuggling (Washington, DC: USCG,
15 July 1924), 9.

> Commandant, U.S. Coast Guard, letter to All Force, Division and Section Base Commanders
and District Superintendents, subject: “Giving Aid and Comfort to and Communicating Intelligence
to Smugglers,” 7 July 1924.

3 Commandant, U.S. Coast Guard, letter to All Commissioned Officers of the Coast Guard,
subject: “Publicity in Connection with Law Enforcement,” 21 August 1924.

51


The Coast Guard’s most involved COMSEC practice was probably in encoding the posi-
tions of blacks located at sea and the positions of the Coast Guard cutters that reported them.
To ensure an adequate level of secrecy for transmission over the radio, the Coast Guard
developed an encoding procedure using standard squared Naval Operations Charts. As
shown in the figure above, numbered blocks represent one squared degree of latitude and
longitude. The larger blocks, in this case 38 and 39, each contain 36 smaller squares. To
encode the position of a vessel located at 34 degrees 18 minutes north latitude, 121 degrees
37 minutes west longitude (indicated by the small red marker in square 27 of block 38
above), the following six digit number was recorded: 382732. The first two digits repre-
sented the block number 38, followed by the number of the smaller square 27. The fifth digit
represented the exact longitude of the vessel east of the western edge of the small square
where it was located, represented in single digits from 1 to 9. In this example, the vessel was
located 3 minutes east of the western edge of small square number 27, or at exact longitude
121 degrees 37 minutes west. Therefore the number 3 was recorded as the fifth digit. The
same reasoning followed for the final digit, representing the exact latitude of the vessel,
expressed in single digits from the northern edge of the small square where it was located.
In this example the vessel was located 2 minutes south of the northern edge of small square
number 27, or at exact latitude 34 degrees 18 minutes north, giving the number 2 then as the
final digit. To further encode a vessel's position, four-digit variable key numbers were added
to the recorded position, lined-up on the left side of the series. To illustrate, using our exam-
ple, the variable key number 6469 was added to the vessel’s recorded position of 382732,
using two zeros on the right end of the key number to align the key number with the left side
of the original series, giving a new figure of 1029632. As numbers beyond six digits were
not carried over, the 1 in this case was simply dropped and the encoded position was trans-
mitted as 029632. Using the same key number, the process was reversed at Headquarters
and the vessel’s position was revealed. Changed daily, these key numbers added an addi-
tional level of security for passing vessel positions over the radio.*

The need to protect its own force and enemy positional information extended
beyond the protection of Coast Guard-only communications. In the summer of 1924,
positions of cutters and rum runners alike were openly displayed on a wall chart,
containing the square numbers used to encode and decode vessel positions, located
in the Operations Offices at Headquarters. As “dozens of unknown visitors
[accessed] these offices daily,” the means of encoding positional data was subject to
compromise. As a remedy, the wall charts were replaced with plain charts not having
the square areas. Additionally, all coded dispatches were sent only to the Intelli-
gence Section for decoding. The Intelligence Section then simply relayed the geo-
coordinates representing vessel locations to the Operations Officer who in turn
marked the chart with colored pins to designate the positions of different vessels.
This concealed the Coast Guard’s method of encoding the information while making

38 1D. FA. De Otte, Commander, California Division, letter to Commandant, U.S. Coast Guard,
subject: “Code “F”; Standard “Squared Chart” for California Division,” 29 January 1929.


mer of 1924, with the first delivery of 17 boats coming later in October." By the summer of
1925, 200 six-bitters were in service defending America’s shorelines.

Figure 4. 75-Foot Patrol Boats
(Six-Bitters).
Source: U.S. Coast Guard, “Six-Bitters,”

photograph(Coast Guard Historian's Office,
Washington, DC: circa 1925).

Other patrol boats built specifically for the enforcement of the Prohibition laws included
thirteen 100-foot patrol boats, built in 1926, and thirty-three 125-foot steel-hulled patrol
boats, joining the fleet in 1927.7? The 125-foot patrol boats were designed to “trail mother
ships on Rum Row in all weather,” with sea-keeping ability considered more important than
their limited 10-knot cruising speed." Various other vessels were outfitted for law enforce-
ment by the Coast Guard, and the construction of approximately 100 picket boats in 1925
rounded out the new anti-smuggling fleet. Designed mainly for close inshore work, the
picket boats, most of which were 36 to 38 feet long, would work in tandem with the six-bit-
ters and other patrol boats to defend against smuggling into “bays, estuaries, harbors and river

mouths.”?>

The Coast Guard also used seized vessels to its advantage by turning those seaworthy
enough to be used by the Coast Guard into patrol boats.” This practice was slow to

Figure 5. 125-Foot Steel Hull Patrol Boats.

Source: U.S. Coast Guard, “125-Foot Patrol Boats,”
photograph(Coast Guard Historian's Office,
Washington, DC: circa 1927).

21 §.S. Yeandle, compilation, 8.

2? Treasury Department, Annual Report for 1925, 424.

3 Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1927 (Washington, DC: GPO, 1927), 160.

°4 Tilley, Coast Guard Vessels of the Prohibition Era.

°5 ‘The picket boats, also of wood construction, were driven by a single gasoline-powered
engine. Most picket boats were capable of up to 25 knots and the Coastguardsmen on board were
armed with machine guns, Tommy guns, and rifles. Waters, Smugglers of Spirits, 59.

26 Waters, Smugglers of Spirits, 59.

27 Treasury Department, Annual Report of the Secretary of the Treasury on The State of the
Finances for the Fiscal Year Ended June 30 1926 (Washington, DC: GPO, 1926), 396.

an]


The Joint Military Intelligence College supports and encourages research on
intelligence issues that distills lessons and improves support to policy-level and
operational consumers.

This book reflects carl archiva research by US. Coast Guard Lieutenant Eric Ensign, who was a
student at this College in the 1997-1998 acadlemic year. The manuscript was origindly prepared to
fulfil part of the requirements for the degree of Master of Science of Strategic Intelligence at this insti-
tution. Hs work holds enduring value, in light of the continuing counters muggling missions of the
US. Coast Guard and other national security organizations. Its publication offers one example of the
variety of applied intelligence research carried out by over 100 successful degree candidates who
graduate each year from this College's graduate program in intelligence studies.

This publication is based exclusively on sources available to the public and the views expressed are
those of the author, and do not necessarily reflect the official policy or position of the Department of
Transportation, the Department of Defense or the U.S. Government.

This publication has been approved for unrestricted distribution by the Oifice of the Secretary of

Defense (Public Affairs). Copies of this publication are available in limited quantities to US. Govern-

ment officials, and to the public though the Nationa Technica Information Service ( <www.ntis.gov>),
or the U.S. Government printing office (<mww.gpo.gov>).

<Fussall. ivenson@uiia.mil>

Editor

Library of Congress Control Number 00-092959
GAN csssssxaaanaw es eeeesaer eT AA RRR 0-9656195-3-2



the liquor industry “completely surround[ed] the United States,” with operations in Mex-
ico, Belize, New Orleans, Miami, Havana,'°° Nassau, Halifax, and Montreal. '®! As Con-
solidated Exporters was well known for its use of radio to facilitate operations, this
necessitated a Coast Guard response in shifting COMINT collection resources from the
Pacific and Atlantic coasts to Florida and Louisiana.' Up to several hundred crypto-
grams a month '° were being sent from Consolidated’s shore site in Belize to its main
headquarters in Vancouver by means of relay ships located off the California Coast.!*
The Belize station also communicated directly with mother ships in the Gulf of Mexico
and with its agents in New Orleans.'®> By placing heavy COMINT emphasis on the Gulf
region in the early 1930s, the Coast Guard was able to collect enough encrypted radio
traffic to allow Headquarters cryptanalysts to break the crypto-system used by Consoli-
dated and in turn have “two or three days in advance the operating orders of the rum-run-
ners, giving contact times, positions, etc.”!°° This was a windfall for the Coast Guard to
the extent that in a 1931 letter to the Commander, Gulf Division, the Commandant cred-
ited attaining rum-runners’ operating orders as “the most important single item combating
rum [running,] .... [whereas] any other systems of intermittent trailing and dropping [rum-
runners] [have become] totally ineffective as the organization of the rum-runners is so
perfected that immediately orders are given to counteract the reported movements of the

Coast Guard cutters.”!”

The success in COMINT operations against the large liquor syndicates culminated in
the 1932 raid of the Consolidated agent’s office in New Orleans. Here, federal agents
seized hundreds of encrypted documents and elicited the help of Mrs. Friedman in solving
them. Based on Mrs. Friedman’s analysis, 35 rum runners were indicted for conspiracy and
Consolidated’s outfit in New Orleans was effectively disbanded.'°S Mrs. Friedman also
helped solve another celebrated case involving the sailing vessel J’m Alone. In 1929, I’m
Alone was fired upon and sank in international waters after refusing to stop for Coast Guard

!©One of the most successful rum-running operations based in Havana was under the control of
“Spanish Marie.” Spanish Marie literally controlled the illicit liquor trade between Havana and the
USS., with a fleet of 15 speedboats under her direction. She equipped her boats with radio and set up
an unlicensed radio station in Key West that transmitted coded messages made up of seemingly
harmless Spanish words and phrases. The Coast Guard broke the code, but let the station continue
operating in order to obtain valuable intelligence. Willoughby, 119-120.

11K ahn, 810.

!©Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Radio-Intelli-
gence; High-Frequency Receivers; Interception of Rum-Runner’s Radio Traffic.” 14 April 1931.

1K abn, 803.

101U§. Consulate at Belize, British Honduras, 1 August 1932.

105U).S. Consulate at Belize, British Honduras, 1 August 1932. Also
Coast Guard, letter to Commander, Gulf Division, subject: “Contact Pos
Gulf Area,” 15 May 1931.

‘¢Commandant, U.S. Coast Guard, letter to Commander, Gulf Division, subject: “Radio-
Intelligence; Interception of Rum-Runner’s Radio Traffic,” 11 June 1931, 1.

‘’Commandant, U.S. Coast Guard, 11 June 1931, 2.

‘Kahn, 810-813

Commandant, U.S.
ions of Rum-Runners in

32


Letter to R. J. Iverson. No subject. 1 February 1928. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Letter to CDR Charles S$. Root, USCG. No subject. 30 April 1928. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Friis, Ole, Radio Electrician, USCG, and R. W. Finley, Radio Electrician, USCG. Letter
to Force Communication Officer. No subject. N.d. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Fuss, Charles M. Sea of Grass: The Maritime Drug War 1970-1990. Annapolis: Naval
Institute Press, 1996.

Garling, Hugh. “The United States Coast Guard: Part I.” Nautical Magazine 247, no. 1
(January 1992): 26-28.

“The United States Coast Guard: Part II.” Nautical Magazine 247, no. 2 (February
1992): 103-106.

“The United States Coast Guard: Part III” Nautical Magazine 247, no. 3 (March
1992): 155-159.

“Germany,” Central Intelligence Agency Fact Book. URL: <http:// www.odci.gov/cia/
publications/factbook/country-frame.html>. Accessed 23 June 1998.

Gorman, F. J., LCDR, USCG, Intelligence Officer. Letter to CPT Donald D. Millikin,
ML-Reserve. No subject. 1 November 1930. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Letter to Commander, Intelligence Unit, New York. Subject: “Radio Intelligence,
Group 2; Code Seized.” 28 January 1931. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to CAPT Chiswell, USCG. Subject: “Travel Order.” 11 March 1931. Records
of the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Intelligence Organization, Com-
pletion of; Official Designation of Field Units.” 1 March 1932. Records of the Coast
Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

75


VIL. The Intelligence Office assists the Department of Justice and the United States
attorneys in preparing important cases.!®

Clearly identifying the Intelligence Section’s main mission as “the dissemination of
information to Units in the field,” CDR Root further categorized his Section’s responsibil-
ities as being related to the dissemination of information, legal duties, liaison duties, the
keeping of statistics, and miscellaneous duties.'” Duties involving the dissemination of
information included conducting espionage, the identification of personnel and vessels
involved in criminal activities, and cryptanal: of enemy codes and ciphers. Legal
duties involved interpreting laws, court decisions, and international treaties; preparing law
manuals and maintaining law ; and attempting to procure seized vessels for Coast
Guard use. Liaison responsibilities included maintaining contact and promoting coopera-
tion with the Departments of State, Justice, War, Navy, Labor, and Commerce; and inter-
departmentally with officers of the Prohibition Bureau, Customs Service, Narcotics
Service, Public Health Service, and Secret Service. The Intelligence Section maintained
statistics on “all matters pertaining to Coast Guard intelligence” including the routing of
incoming and outgoing secret correspondence and the recording of vessels seized by the
Coast Guard.'* Finally, miscellaneous duties included the “collection, preparation, and
mailing of information, disseminated by means of secret and confidential letters, mes-

sages and confidential Intelligence Office Circulars.”!°

EVOLUTION OF INTELLIGENCE DISCIPLINES WITHIN
THE COAST GUARD

In the 1920s, the all-out intelligence effort in support of anti-smuggling operations did
not correspond neatly with today’s intelligence categories of HUMINT, COMINT,
IMINT, and Open Source Intelligence. However, the use of each type of intelligence was
evident as the Coast Guard employed all means at its disposal to gain, interpret, and dis-
seminate intelligence. Because radio was not widely used on rum-running vessels until
the mid-1920s, HUMINT operations became a major focus of Coast Guard Intelligence in
the early days of Prohibition. This was followed by an emphasis on COMINT as the rum
runners and the Coast Guard turned to radio to transmit encrypted operational messages.
From the beginning, airborne imagery collection provided a source for gaining photo-
graphic and positional data on rum-runners, albeit its full potential was not exploited until
the later years of Prohibition. Finally, throughout Prohibition, the Coast Guard used Open
Source Intelligence to increase its understanding of rum-running tactics and capabilities
and to enhance its intelligence support to the fleet. Although each discipline was culti-
vated independently, they were employed in concert.

‘© Charles $. Root, CDR, USCG, Intelligence Officer, letter to President, Regulations Board,
subject: “Chapter 7, Regulations, Revision of. Duties of the Intelligence Office,” 9 August 1928, 1.

'” Charles S. Root, 9 August 1928, encl (1), 1.

18 Charles S. Root, 9 August 1928, encl (1), 2.

'° Charles S. Root, 9 August 1928, encl (1), 2.


INTELLIGENCE IN THE RUM
WAR AT SEA, 1920-1933

By Eric S. Ensign
Lieutenant, U.S. Coast Guard
Joint Military Intelligence College Class of 1998

Edited by Russell G. Swenson

With an Introduction by
Admiral Robert E. Kramek
Commandant, United States Coast Guard, (Ret.)

Joint Military Intelligence College
Washington, DC 20340-5100
January 2001


Letter to Commandant, U.S. Coast Guard. Subject: “Recommendation that an Officer
be Sent to Nova Scotia to Study Types of Rum Boats.” 31 August 1929. Records of
the Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297;
National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Further Suggestions Regarding
Black Situation in Area “B”.” 13 September 1929. Records of the Coast Guard Intelli-
gence Division 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Report of Special Narragansett
Patrol, 24 March to 7 April, 1930.” N.d. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Proposed Letter to All Units
Except the Destroyer Force, Regarding Use of False Bottoms, etc.” 19 April 1930.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Willebrant, Mabel W., Assistant U.S. Attomey General. Letter to the Secretary of the Trea-
sury. No subject. 7 February 1923. Coast Guard Historian’s Office, Washington, DC.

Letter to Commandant, U.S. Coast Guard. No subject. 15 July 1925. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

The Inside of Prohibition. Indianapolis: The Bobbs-Merrill Company, Publishers,
1929.

Willoughby, Malcom F., CDR, USCGR(T). Rum War at Sea. Washington, DC: GPO,
1964.

Yeandle, S. S., Aide to Commandant, U.S. Coast Guard. Letter to Commandant, U.S.
Coast Guard. Subject: “Radio, Telephone, and Telegraphic Reports on Smuggling
Operations.” 6 August 1924. Records of the Coast Guard Intelligence ion 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Compilation of Coast Guard Efforts to Combat Rum-Running. No subject. N.d. Coast
Guard Historian’s Office, Washington, DC.


The Coast Guard’s use of all-source intelligence was not limited to that readily obtain-
able through intelligence collection or that provided by intelligence sharing with other
federal agencies. In an effort to forecast rum-running activity, the Intelligence Section
used statistics of prior seizures and other information to generate charts showing the fluc-
tuation of smuggling activity vis-4-vis phases of the moon.'” This allowed the Coast
Guard to concentrate its patrols at times more likely to yield the greatest results in the
interdiction and apprehension of rum runners. Not surprisingly, illegal activity intensified
during each new moon and tapered off during full moons.

As a measure of effectiveness of the Coast Guard’s all-source intelligence program, in
August 1928, the Commissioner of Prohibition, Dr. James H. Doran, announced liquor
shipments to the U.S. by sea had been reduced 60 percent from 14,000,000 gallons in fiscal
year 1927, to approximately 5,000,000 gallons in fiscal year 1928.'”! The relationship
between the use of intelligence and the decline in smuggling was keenly felt among cutters
in the anti-smuggling fleet, prompting the Commander of the Florida East Coast Patrol
Area to write, “information received from [the Intelligence Section] is the best barometer
of how things are going in my own particular area.”'” The all-source intelligence effort
sustained by the Intelligence Section at Headquarters continued to provide operational
Coast Guard units a level of DBK over and above that obtainable by even the most diligent
efforts of the anti-smuggling fleet alone. It was appreciated by the fleet for its value to the
enforcement effort and, in the end, considered an integral part of the Coast Guard’s anti-
smuggling operational strategy.

In summary, when faced with the dilemma of how to enforce the Prohibition laws with
minimal assets, the Coast Guard launched a massive campaign using the intelligence dis-
ciplines of HUMINT, COMINT, IMINT, and Open-Source Intelligence to attain DBK
over the rum runners and multiply the effectiveness of the anti-smuggling fleet. The col-
lection, analysis, and dissemination of critical intelligence provided the Coast Guard a
view of the battlefield otherwise unobtainable without the concerted effort of both the
Intelligence Section at Headquarters and commanders on the front line. Through inter-
agency cooperation and intelligence sharing with other federal agencies, the Coast Guard
enhanced the effectiveness of the combined government effort to enforce Prohibition and
furthered its own intelligence program in the process. The resulting all-source intelligence
effort allowed the Coast Guard to employ its limited resources intelligently against the
best-laid plans of the rum syndicates. The rum syndicates’ own intelligence strategy can
place the Coast Guard’s efforts into some perspective.

‘US. Coast Guard, “Prevalence of Blacks with Reference to Phases of Moon for the Year End-
ing January 31, 1930,” chart, n.d.

‘Tn the days of Prohibition, U.S. Government fiscal years ran from July 1 through June 30
annually, “Rum Row and Finger Prints,” The Outlook, 1 August 1928.

Commander, Section Base Six, letter to CAPT C. S. Root, USCG, no subject, 9 April 1930.

44


every rum boat on the Pacific Coast had its own code or cipher”””® This of course presented
even greater challenges for the Coast Guard and the Prohibition Bureau in deciphering the
plans and intentions of the rum syndicates.

As the syndicates grew, two rival organizations gained influence over the rum trade on
the Pacific Coast. By 1928, the Hobbs Group and Consolidated Exporters Corporation,
both operating out of Vancouver, Bri Columbia, controlled all of the illegal liquor
entering the U.S. from the West.’’ Using a complex communications system, Consoli-
dated Exporters employed three shore stations using different crypto-systems to commu-
nicate with each of its blacks, who in turn communicated with mother ships using still
different crypto-systems.

(Stewie! Sener Sev wae eal Phare Coney Mavniave:
HEADQUARTERS
—VAN COUVER—
yf af ,
xf
oj
fencn ety ahaa 3

cose _U"
cone "A"

Figure 9. Consolidated Exports’ Communications System.

Source: David Kahn, The Codebreakers: The Story of Secret Writing
(New York: Macmillan Publishing Company, 1967), 805. Used with permission.

As sophisticated as these systems were, however, they were no match for the skilled
cryptanalysis of Mrs. Friedman. In the first three years working for the Coast Guard, Mrs.
Friedman solved over 12,000 cryptograms, some of which were of a “complexity never
even attempted by any government for munications.”’8 Mrs. Fried-
man’s work wi on the West Coast that it
inspired Mr. Ralph R. Read, Supervising Agent for the Prohibition Bureau in San Fran-
9, to write “it is my opinion that [cryptanalysis] is the means which will enable this

most secret ci

7 David Kahn, The Codebreakers: The Story of Secret Writing (New York: Macmillan Publish-
ing Company, 1967), 803.

77 Kahn, 803.

78 Kahn, 804-806,

28


sources of information was the Halifax Morning Chronicle, which regularly reported the
positions of vessels known by the Coast Guard to be engaged in liquor smuggling.'” So
profitable was the collection of open-source information to the overall interdiction effort
that, by the summer of 1928, the Coast Guard was regularly reviewing headlines from
Nova Scotia, Cuba, the Bahamas, and Bermuda, as well as several key U.S. cities. Addi-
tionally, telephone directories of principal U.S. and contiguous countries were kept
on hand to assist the Intelligence Section in its analysis of rum-running activity reported
in the open press.'"° This allowed the Coast Guard to keep abreast of developments
regarding new smuggling craft and personnel involved in the illicit liquor trade.

The Coast Guard also turned to open-source intelligence to support its use of COMINT
in gaining the operating plans of the rum fleet. With early black codes taken from two com-
mercially available code books, the Coast Guard needed only purchase the same books to
break the codes.'“! Ultimately, this success was short-lived as the rum runners and their
codes became more sophisticated as the Rum War raged on.

INTERAGENCY COOPERATION AND INTELLIGENCE SHARING

Correctly assessing the value of intelligence to the task at hand by an early date, the
Coast Guard went one step further and began cultivating an intelligence-sharing network
with other U.S. government agencies capable of supporting enforcement of the
Prohibition laws. By building a rapport and sharing intelligence with agencies inside the
Departments of State, War, Navy, Justice, Post Office, Interior, Commerce, and Labor,
and the Shipping Board, as well as with other agencies of the Department of the Treasury,
the Coast Guard was able to increase the value of intelligence to the enforcement
effort.!“? The resultant pooling of resources of this “intelligence community” enabled the
U.S. government to present a cohesive effort in battling an increasingly sophisticated
enemy. Furthermore, it increased the government’s collective level of DBK over the rum
runners. In a 1928 letter to the Coast Guard Regulations Board, CDR Root detailed the
extent of outside relationships maintained by the Intelligence Section at Headquarters:

From the State Department information is obtained concerning the movements of ves-
sels and persons abroad who are engaged in or conspiring to engage in the violation of
the laws of the United States involving operations on the ocean and information con-
cerning the attitude of other governments on subjects which are pertinent to our work.

In the War Department the Intelligence Office of the Coast Guard is in correspon-
dence with the Military Intelligence division of the General Staff (G-2), and with
the Code and Cipher section of the Signal Corps.

°w. H. Munter, CDR, USCG, letter to Commandant, U.S. Coast Guard, subject: “Intelligence
Information, Whereabouts of Vessels Engaged in the Liquor Trade.” 21 August 1924.

‘Charles S. Root, 9 August 1928, 4,

'41Charles $. Root, 10 October 1927.

'2Charles S. Root, 9 August 1928, 1.

37


“Twelfth District U.S. Coast Guard.” Chart. 1 January 1923. Coast Guard Historian’s
Office, Washington, DC.

“Type X RDF.” Photograph. Circa 1930. Coast Guard Historian's Office, Washington,
be.

U.S. Consulate at Belize, British Honduras. Confidential Memorandum for Colonial Secre-
tary. No subject. 1 August 1932. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

U.S. Customs, Special Agency Service. Memorandum for U.S. Coast Guard. No subject.
7 March 1925. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Verrill, A. Hyatt. Smugglers and Smuggling. New York: Duffield and Company, 1924.

Voris, Alvin C., LTC, USA Signal Corps. Letter to Commandant, U.S. Coast Guard. Sub-
ject: “Code System.” 14 June 1924. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
DC.

Waters, Harold. Adventure Unlimited: My Twenty Years of Experience in the United States
Coast Guard. New York: Prentice-Hall, Inc., 1955.

Smugglers of Spirits: Prohibition and the Coast Guard Patrol. New York: Hastings
House, Publishers, 1971.

Waters, Harold, and Aubrey Wisberg. Patrol Boat 999. New York: Chilton Company,
Book Division, Publishers, 1959.

Webster, E. M. Memorandum to Intelligence Officer. No subject. 6 November 1928.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Wheeler, Wayne B., General Counsel, the Anti-Saloon League of America. Letter to
Commandant, U.S. Coast Guard. No subject. 24 July 1924. Coast Guard Historian’s
Office, Washington, DC.

Wheeler, William J., CAPT, USCG, Inspector-in-Chief. Letter to Commandant, U.S.
Coast Guard. No Subject. 5 January 1926. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Cruising of George’s Bank.”

5 April 1927. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.


Much HUMINT was supplied from the State Department, collected by its overseas
consulates. Regular dispatches detailing the arrivals and departures of vessels known to
be engaged in liquor smuggling were received from Halifax and Yarmouth, Nova Scotia;
St. John’s, Newfoundland; Havana, Cuba; Nassau, Bahamas; Glasgow, Scotland; Vera
Cruz, Mexico, and Bremerhaven, Germany.* In addition, the Coast Guard routinely
requested that specific information, such as the trial speeds of foreign vessels, be col-
lected by the State Department for analysis at Headquarters.” Occasionally, information
regarding the status of vessels being constructed in foreign countries exclusively for
liquor smuggling was provided, including the timetable for completion and the financial
status of the owners.

HUMINT information was also used to enhance the effectiveness of other intelligence
disciplines. As the rum fleet started to equip its vessels with radio, Coast Guard patrols
and other sources reported on the vessels involved and the types of radios being
installed.*? This allowed the Intelligence Section to keep tabs on which vessels were capa-
ble of communicating with their home bases via radio and, in turn, supported the Coast
Guard’s COMINT collection effort. HUMINT reporting also indicated the existence of
radio broadcasting trucks which the rum runners moved from place to place along the
Atlantic Coast and used to broadcast liquor orders to rum runners offshore.*°

To further ascertain which vessels were involved in the rum trade, the Coast Guard
compiled reports on vessels returning in ballast to ports in Nova Scotia and St. Pierre and
Miquelon after supposedly fishing off the U.S. Northeast Atlantic coastline.*! This effort
was complemented by information received from local fishermen informing the Coast
Guard where rum runners would anchor and pretend to engage in fishing.!* When the ves-
sels were boarded, they were often found to have legitimate loads of fish in their holds
until HUMINT reporting indicated rum vessels were secreting loads of liquor beneath
otherwise legitimate cargoes of fish and ice.** In response, the Coast Guard equipped its
destroyers and patrol boats with “iron rods, with knobs on the end,” to probe fish holds for

36 Department of State, paraphrase of a telegram received from the American Consul General at
Halifax, Nova Scotia, no subject, 26 June 1925.

57 Secretary of State, letter to Secretary of the Treasury, no subject, 12 April 1924.

38 Secretary of State, letter to Secretary of the Treasury, no subject, 14 April 1924.

39 §. P. Edmonds, Commander, Base Fifteen, letter to Commandant, U.S. Coast Guard, subject:
“Radio Receiving Set, Br. Schr. Varuna,” 7 December 1925.
40 E, T. Osborn, Officer-in-Charge, Coast Guard Station Little Beach, letter to Commander, Fifth
District, subject: “Use of a Radio Broadcasting Motor Truck by Smugglers; Report of,” 29 July 1931.
4 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, no Subject, 5 January 1926.

William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Cruising of George’s Bank,” 5 April 1927.

48 William J. Wheeler, CAPT, USCG, Inspector-in-Chief, letter to Commandant, U.S. Coast
Guard, subject: “Recommendation by Mr. Thomas Finnegan, Veteran Deputy Collector, Boston,
Massachusetts,” 28 April 1928.

23


Letter to Commandant, U.S. Coast Guard. Subject: “Recent Sweep by Destroyers.”
4 October 1927. Records of the Coast Guard Intelligence Division 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subje Positions Coast Guard Vessels
and “Blacks” - Routine Reports.” 12 November 1927. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard, Subject: “Proposed Change in System of
Position Reports.” 19 December 1927. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Notes Taken From Mr. Owens of
Foreign Control Section, Prohibition Service, March 28, 1928.” 29 March 1928.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Recommendation by Mr. Tho-
mas Finnegan, Veteran Deputy Collector, Boston, Massachusetts.” 28 April 1928.
Records of the Coast Guard Intelligence Division 1922-1932, Record Group 26,
Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “General Report and Recommen-
dations Regarding Section Bases from Charleston to Galveston, Inclusive.” 3 July
1928. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Inclosed Letters from Command-
ers Jones and Jack.” 2 January 1929. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building,
Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Florida Situation.” 11 March
1929. Records of the Coast Guard Intelligence Division 1922-1932, Record Group
26, Entry 297; National Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. No subject. 23 March 1929. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Letter to Commandant, U.S. Coast Guard. Subject: “Confidential Communication
from Commander Klinger.” 20 July 1929. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.


Chapter 2

RISING TO THE OCCASION: INITIAL MEASURES TO
COMBAT THE RUM RUNNERS

The decision to place the Coast Guard squarely in charge of combating the influx of liquor
on America’s shores was a key turning point in Coast Guard history. The Coast Guard had
been founded in 1790 explicitly for the purpose of suppressing smuggling, and by the 1920s
the Coast Guard’s attention had come to be divided among various missions, with increasing
focus on the preservation of life and property at sea.' As a result, the Coast Guard was ill-
equipped for the battle that lay ahead. The Coast Guard’s response to this new threat, how-
ever, transformed America’s smallest military service into a formidable fighting force and
gave the Coast Guard a reputation for “getting the job done” that still defines the Service
today. In a July 1924 letter to Mr. Wayne Wheeler, General Counsel of the Anti-Saloon
League of America, Commandant Billard summed up the Coast Guard’s challenge indicating
“the duty of putting a stop to ... illegal [liquor] traffic at sea is the greatest and most difficult
task that has ever been imposed upon any of the floating forces of the United States in time of
peace: He further set forth that “the Coast Guard has accomplished many difficult tasks in
its history of over a century and a quarter, and it proposes to accomplish this one.” “Give us
the tools, and we'll get on with the job’

Various measures were taken to even the odds for the Coast Guard in facing the rum run-
ner. Recruiting efforts were doubled, vessels were designed and built specifically to combat
rum running, World War I-vintage destroyers were acquired from the Navy and added to the
Coast Guard’s anti-smuggling fleet, a doctrine for the prevention of smuggling was devel-
oped, and treaties were signed, all having some effect on the Coast Guard’s ability to enforce
the Prohibition laws.

! ‘The Coast Guard began as the Revenue Marine, more commonly known as the Revenue Cut-
ter Service, organized by the first Secretary of the Treasury, Alexander Hamilton, in 1790. With the
construction of 10 revenue cutters, the Revenue Cutter Service was tasked with the protection of
customs, as smuggling deprived the Treasury Department of legal duties on imports. In 1915, the
Revenue Cutter Service was joined with the Lifesaving Service and renamed the United States
Coast Guard. Although the Coast Guard continued to be tasked with the prevention of smuggling, in
the years immediately following the Coast Guard’s reorganization, the preservation of life and prop-
erty at sea became a major focus for Coast Guard efforts. Although modern-day “search and rescue”
still remains in the forefront of Coast Guard missions, the Coast Guard’s legacy of combating
smuggling during Prohibition lingers on as the Coast Guard remains actively engaged in preventing
smuggling of all sorts on America’s shorelines. Malcom F. Willoughby, CDR, USCGR(T), Rum
War at Sea (Washington, DC: GPO, 1964), 21-22.

> Commandant, U.S. Coast Guard, letter to Wayne B. Wheeler, General Counsel, the Anti-
Saloon League of America, no subject, 25 July 1924.

> Commandant, U.S. Coast Guard, 25 July 1924.

+ Harold Waters, “Five Flashes East,” in 80 Years of Yachting, ed. Bill Robinson (New York:
Dodd, Meade & Company, 1987), 78.



Chapter 6
THE COAST GUARD AND THE END OF PROHIBITION

Although Prohibition was not repealed until December 1933, as early as 1929 its
future was in doubt, as several ominous events served to change public opinion in favor
of repealing the 18th amendment. In an ironic twist of fate, Al Capone himself proved
the 18th amendment unenforceable by his widespread corruption in Chicago and other
Us s and thus had a hand in his own eventual demise. The Valentine’s Day Ma
cre,! in February 1929, was the final straw that convinced many Americans “the ‘cure’
was worse than the ‘disease.’”* The first step in remedying the situation came when
President Herbert Hoover appointed the “Wickersham Commission” to “[study] the
problems of Prohibition enforcement.”* After two years, the Commission released a
watered-down report with no real recommendations to bolster the enforcement effort.
In October 1929, the Stock Market collapsed ushering in the Great Depression. With a
failing economy and government revenues slipping, the Prohibition dilemma proved
too much for a majority of Americans. Prohibition boosted crime. It cost the govern-
ment a fortune in lost liquor tax and it cost over $300 million to enforce. As a result, in
1931, a new presidential candidate, Franklin Delano Roosevelt, campaigned for repeal
on the democratic ticket. His strategy worked and in 1932, Franklin Roosevelt was
elected the first democratic president in 12 years. During his victory speech, President
Roosevelt promised to repeal the Volstead Act, a promise he made good on shortly after
taking office in January 1933. While waiting for individual states to ratify the repeal,
President Roosevelt asked Congress to modify the Volstead Act to allow beer with an
alcoholic content of 3.2 percent. Congress immediately complied and America began
enjoying its “new deal” as the end of Prohibition drew nearer with each State conven-
tion. In November 1933, the 36th state needed to ratify the repeal of the 18th amend-
ment, Utah, capitulated and on 5S December 1933, the 21st amendment made alcohol
once again legal.° This put an end to the “big business” of rum running and allowed the
Coast Guard to refocus its energies more evenly among its other missions. It also
resulted in almost immediate downsizing of the Coast Guard’s Prohibition asse'
Prohibition enforcement agencies suffered severe reductions in appropriations under
the Roosevelt Administration. All remaining destroyers were returned to the Navy and a
formidable number of smaller Coast Guard boats were disposed of.’ The Coast Guard’s

' On 14 February 1929, members of Al Capone’s gang murdered seven members of a rival gang
in an execution-style killing meant to serve as a deterrent to other local gangs against infringement
upon Capone’s claimed “territory.” The Prohibition Era: The Road to Repeal, prod. Charlotte
Moore, dir. Clive Maltby, 50 min., A&E Home Video, 1997, videocassette.

2 Willoughby, 158-159.

Willoughby, 159.

Willoughby, 159.

The Prohibition Era: The Road to Repeal.
Willoughby, 159-160.

59


Haines, Roy A., Federal Prohibition Commissioner. Letter to Civil Service Commission.
No subject. 27 April 1927. Records of the Coast Guard Intelligence Division 1922-
1932, Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Civil Service Commission. No subject. N.d. Records of the Coast Guard
Intelligence Division 1922-1932, Record Group 26, Entry 297; National Archives
Building, Washington, DC.

Hamlet, H. G., Commander, Destroyer Force. Letter to Commandant, U.S. Coast Guard.
Subject: nity of Area Baker.”
15 April 1927. Records of the Coast Guard Intel n 1922-1932, Record
Group 26, Entry 297; National Archives Building, Washington, DC.

Hartson, Millard T., Collector, U.S. Customs Service. Letter to E. W. Camp, Director of
Customs. No subject. 26 June 1924. Records of the Coast Guard Intelligence Division
1922-1932, Record Group 26, Entry 297; National Archives Building, Washington,
DC.

Helm, William P., Jr. “Coast Guard Soon to Match Liquor Armada Ship for Ship.” Wash-
ington (DC) Evening Star, 22 May 1925. Records of the Coast Guard Intelligence
Division 1922-1932, Record Group 26, Entry 297; National Archives Building, Wash-
ington, DC.

Helmick, Leah S. “Key Woman of the T-Men.” Reader’s Digest (September 1937): 51-55.
Copy obtained from the Coast Guard Historian’s Office, Washington, DC.

Holdcamper, Forrest R. Preliminary Inventory of the Records of the United States Coast
Guard: Record Group 26. Unpublished research paper. September 1963. Copy
obtained from the Coast Guard Historian’s Office, Washington, DC.

Hoover, J. Edgar, Director, Bureau of Investigation. Letter to CDR Charles S. Root,
USGG. No subject. 21 January 1925. Records of the Coast Guard Intelligence Divi-
sion 1922-1932, Record Group 26, Entry 297; National Archives Building, Washing-
ton, DC.

Letter to CAPT Charles S. Root, USCG. No subject. 26 June 1930. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.

Housel, C. A., Special Agent. Letter to Ralph R. Reed, Supervising Agent. No subject. 16
December 1927. Records of the Coast Guard Intelligence Division 1922-1932,
Record Group 26, Entry 297; National Archives Building, Washington, DC.

Letter to Commissioner of Prohibition. No subject. 6 August 1928. Records of the
Coast Guard Intelligence Division 1922-1932, Record Group 26, Entry 297; National
Archives Building, Washington, DC.


Chapier 4

RUM RUNNERS’ USE OF INTELLIGENCE AND
COUNTERINTELLIGENCE

“Oh, we don’t give a damn for our old Uncle Sam
Way-o, whiskey and gin!

Lend us a hand when we stand in to land

Just give us time to run the rum in.”

“Tis easy and free for us boys out at sea
Way-o, whiskey and gin!

Pigs will all fly when the country goes dry
Give us the word, we'll run the rum in.”

The Smugglers’ Chantey, Joseph Chase Allen, 1921

Information superiority in favor of the Coast Guard in the Rum War was not obtained
overnight, nor was this outcome uncontested. Organized crime syndicates as well as inde-
pendent rum runners made various attempts to collect and use intelligence to protect their
precious liquor cargoes. Rum runners used not only most of the standard intelligence col-
lection disciplines, but also employed counterintelligence practices,' specifically commu-
nications security (COMSEC) measures and operations security (OPSEC) measures, to
keep its plans and intentions out of the hands of the enforcement patrols.

INTELLIGENCE COLLECTION AGAINST THE COAST GUARD

Although the rum-runners’ intelligence collection efforts never reached the magnitude
of the Coast Guard’s, it was not from lack of trying. Determined blacks used all means at
their disposal to try and learn the operating plans of the Coast Guard. But because the rum
fleet did not have a large bureaucratic infrastructure to support its intelligence collection
efforts, as the Coast Guard had, attempts at intelligence collection were often amateurish
and clumsy and were routinely compromised by the Coast Guard’s own intelligence suc-
cesses and by the government’s strict use of OPSEC and COMSEC to protect sensitive
information. Nonetheless, attempts were made to use HUMINT, COMINT, and IMINT to
gain usable intelligence and assist the rum runners in evading detection.

Probably the easiest and most reliable method of obtaining the Coast Guard’s operating
plans was to “turn” someone on the inside and bribe them into divulging useful intelligence.

' Counterintelligence is defined as “[i]nformation gathered and activities conducted to protect
against espionage, other intelli gence activities, sabotage, or assassinations conducted for, or on
behalf of, foreign powers, organizations, persons, or terrorist activities.” Central Intelligence
Agency, A Consumer's Guide to Intelligence (Langley, VA: CIA Public Affairs Office, 1995), 52.

45


radio operator informed his commanding officer, over a private unlisted wire, that a code
used by a particular group of rum runners had been successfully broken by the operator,
and approximately 30 minutes later, the Coast Guard intercepted a radio message inform-
ing certain rum ships that “the Government had deciphered their code and that they
should stop using it.”? This prompted stricter COMSEC measures by the Coast Guard in
handling all information related to its intelligence efforts against the rum runners.

The rum syndicates also had some success in physically intercepting Coast Guard tele-
grams sent via the wireless services. This occurred most often at the Havana office of the
Western Union Telegraph Company and resulted in the Coast Guard’s discontinuance of
sending wireless messages to Havana.'°

Finally, the rum syndicates also employed IMINT in limited attempts to learn the
whereabouts of Coast Guard cutters on patrol. Hydroplanes were used off the Atlantic
Coast to observe the location of Coast Guard patrol boats and then relay the information
to rum vessels at sea.!!

COUNTERINTELLIGENCE TACTICS AND DECEPTION
TECHNIQUES

As the rum syndicates invariably knew the Coast Guard and other government agen-
cies were targeting their communications for intercept, various measures were used to
maintain levels of COMSEC and OPSEC sufficient to conceal rum-running operations
from the enforcement agencies. In addition to the use of standard codes and ciphers, the
rum runners also employed ingenious, sometimes comical, methods to protect their com-
munications. To make the solving of codes and ciphers more difficult for the Coast Guard,
some groups mixed profanity in with their coded messages.'? Another tactic involved
wording radio conversations as innocently as possible, by using cover terms to conceal
the true meaning of words and phrases.'? Rum runners also frequently changed their
codes and eventually abandoned the use of wireless commercial carriers altogether in
favor of direct ship-to-shore communications." To better their odds at escaping detection,
some rum syndicates broadcast “in the blind” to the rum ships offshore, in an effort to

° Charles S. Root, CDR, USCG, Intelligence Officer, letter to CAPT Randolph Ridgely, USCG,
no subject, 28 May 1930.

10 Unidentified correspondent, memorandum for the Intelligence Division files, no subject, n.d.

‘| Commander, Section Base Eight, letter to Commandant, U.S. Coast Guard, subject: “Hydro-
plane Operating in the Vicinity of Chincoteague, VA,” 28 December 1925.

? B J. Gorman, LCDR, USCG, Intelligence Officer, letter to Commander, Intelligence Unit,
New York, subject: “Radio Intelligence, Group 2; Code Seized,” 28 January 1931.

8 CLE. Reeves, Special Agent, letter to Mr. Topham, no subject, 16 January 1928. Also see, R.
J. Iverson, letter to LTIG Clifford D. Feak, USCG, no subject, 16 February 1928.

“4 C_A. Housel, Special Agent, letter to Ralph R. Reed, Supervising Agent, no subject, 16
December 1927.

47


BIOGRAPHY OF ADM ROBERT E. KRAMEK

In 1998, Admiral Kramek retired from the U.S. Coast Guard, having served as that
Service’s 20th Commandant. In his Coast Guard career, he served as both a Surface Oper-
ations Specialist and Naval Engineer, with extensive service in all regions, including the
Atlantic, Pi , Caribbean and Alaska. He was appointed by President Clinton to be the
U.S. Interdiction Coordinator for the National Drug Control Program. Admiral Kramek’s
earlier assignments included Chief of Staff of the U.S. Coast Guard, commander of two
Coast Guard districts, and head of the Haitian Migration Task Force. He also commanded
the Coast Guard Base at Governors Island, New York, and the High Endurance Cutter
MIDGETT. During his career, he initiated partnerships and bilateral agreements with the
U.S. Maritime Industry and with foreign nations that have resulted in major improve-
ments in safety and national security. The Admiral’s awards include the Transportation
Distinguished Service Medal, two Coast Guard Distinguished Service Medals, two legion
of merit awards, the Meritorious Service Medal, the Special Operations Ribbon with sil-
ver star, the Humanitarian Service Medal with bronze star, and the Sea Service Ribbon
with bronze star. Admiral Kramek currently serves as President of the American Bureau
of Shipping—Americas Division.



Camden, NJ 1911
Philadelphia, PA 1912
Camden, NJ 1911
Bath, ME 1913
Philadelphia, PA 1916
Bath, ME 1913
Bath, ME 1916
Camden, NJ 1915
Camden, NJ 1915
Newport News, VA 1912
Quincy, MA 1912
Bath, ME 1912
Camden, NJ 1911
Bath, ME 1914
Newport News, VA 1911
Philadelphia, PA 1911
Bath, ME 1910
Philadelphia, PA 1916
Newport News, PA 1910
Mare Island, CA 1917
Newport News, VA 1910
Bath, ME 1911
Quincy, MA 1916
Camden, NJ 1916
Philadelphia, PA 1916

Figure 3. The 25 Destroyers.

Source: Malcom F. Willoughby, CDR, USCGR(T), Rum War at Sea
(Washington, DC: GPO, 1964), 49.

In addition to the 27 blue-water vessels acquired from the Navy, several other vessels were
rapidly constructed to aid the Coast Guard in confronting its foe. The primary workhorse of
the new anti-smuggling fleet would become the 75-foot patrol boat, or “six-bitters”!? as they
were better known, working with smaller picket boats and the destroyer fleet to keep the rum,
vessels under surveillance.” Construction on the new 75-foot patrol boats began in the sum-

!9 The 75-foot patrol boats were commonly referred to as “six-bitters,” a reference to the ves-
sels’ length. Monetary values were also applied as slang terms for other vessels including the 125-
foot patrol boats, knows as the “buck-and-a-quarters.” Willoughby, 57.

20 The 75-foot six-bitters were a jack-of-all trades for the Coast Guard. They were wooden
hulled vessels with twin gasoline motors designed for 13 knots. Each boat carried a one-pounder
gun mounted on the bow and two Lewis machine guns. Waters, Smugglers of Spirits, 60.

10