REPORT OF VISIT 

TO 

m._ypro A. G. (HAGELIN) 

BY 

WILt.IAM F. FRIEDMAN 

SPECIAL ASSISTAl'.r TO THE DIREC.OOR, NATIONAL SECURI'l'!' AGENCY 

n - 28 FEBRUARY 1955 

Declassified and approved for release by NSA on 06-20-2014 pursuantto E.O. 1352a 

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120 3.3(h)(2) 

I. INTRODUCTION PL 86-36/50 USC 3605 

1. In accordance with Letter Orders 273 dated 21 January 1955, as 

modified by L.o. 273-A dated 4 February 1955, I le:f".t Washington via MATS 

at 1500 hours on 18 February 1955, arrived at Orly Field, Pari.s, at 1430 

hours on 19 February, and at Zug, Switzerland, at 1830 th.e same day. I 

spent the next few days with Mr. Boris c.w. Hagelin, Senior, and Mr. Boris 

Hagelin, Junior, for the pur1>0se of learni the status of heir new 

develo nts in er atus and 

Upon completion or that pa.rt of. m:i mission., I left Zjig at 

l 0 hours on 28 February and proceeded to London, arriving at 1845-that 

evening. 

2. The following repor1; is based upon notes ma.de of \the\ substance 

of several talks with the Hagelins, at times in separate meetings with 

each of them and at other tines in meetings with both of them. 

3. The notes regarding the status of new developments and pl.ans 

for the future should be of interest. Included among these notes \:is 

information at cjsidez;a.ble importance in connection with the problem 

I -

was ma.de to him during '-:i:t;:-he=-=e==ve==n::ri=ng:-"'.o=:ir-'"?'n::--wl:'ec:rua==-=ry=;~an=::r--=--.,,,e,......,....,._.,sc=u=s ... s'""1-=o=n...Js thereon were continued 

with Mr. Ha.gelin, Junior, on 27 February at the request of Mr. Hagelin, 

Senior. 

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II. STATUS OF NEW DEVE°LOP.MENTS 

1. Sales and"Prospects of Sales of C-Line of Machines. -- The 

following iDf'orma.tion under this heading was given mostly by Hs.gelin 

Jr., who either had the data. in. memory or ha.d quick access to the 

records pertaining thereto: 

a. The present manufacturing capacity of the Ha.gelin plant 

in StockhOlm for the manufacture of the C-line or ma.chines (C-521 

CX-52, etc.) is 60 to 80 ma.chines per month; the goal is to increase 

this to 100 per month as soon as practicable aJ:ter the Stockholm. plant 

is closed down and the new plan.tin Zug is' well e13tablished (see para 

lb below) •. No manufacturing qt10tas were mentioned with regard to 

other machines; the latter are still ih the development, prototype, or 

pre-production stage. 

b. Decision has been made to close down the plant in Stockh.o3-

and to moV"e such of its ma.nufa.c=turing tools and equipment as, is deemed 

advisable or necessary to Zug, where two new buildings are to be preJilB.l'ed for production of the new lines of ma.chines. One of these buildings is an existing structure which is to be modified to suit the need 

tor ad.di tiona.J. space for opera.1;ions but its top floor is to be made 

into an apartment for the chief engineer, Mr. Sture Nyberg, presently in 

Stockholm but scheduled to movE~ to Zug as soon as the apartment is compl.eted. ·The other building is to be newly constructed and the excavation 

therefor ha.a been completed; its top tloor is t~ be an apartment for Boris 

Ha.gelin, Junior and his family. The three buildings (the two abovementioned, plus the present research and development building) are ad.Jacent 

to the home of Boris Ha.gelin, Senior, so that the new plant compriei.J:lg 

Crypto A.G. will be a compact, homogeneous set of units. I was told by 

Bagelin Junior that his father expects to retire f~om active direction 

of Crypto A.G. in two years (at age 65), although undoubtedly he will, 

continue to have a voice or hand in direction thereafter. From one comment 

made by Bagelin Senior, I gathered the unmistakable impression that he 

plans to let Hageliri Junior take over the Crypto business and direct its 

affairs wheii he hims.elf retires. 

c. (i) The plant in Stockholm, besides being now engaged in 

manu:racturing of' iaev C-52 and CX-52 ma.chines, is also to fill an order 

tor 500 to 11 000 ma:cb.ines of the old C-446 type. (See para.graph f'(J.4) 

below. ) In order to execute ·this order some or most of the tool.a tor 

ma.king the C-446 will ba~e to be rehabili~ted or else replaced with 

new ones. I asked ~iiiiGenior if he needed any fi~cia.l help in 

this regard; his answef' -.~ ln the negative,, since, as he said, he 

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estimated the cost of rehabilitating the old tools or ma.king new ones 

to be only about $10,000. However, he indicated that\.he might like 

to he.ve some help in building up his new plant in 7.ug \for wit.hout it 

he will have to sell some of his liquid capital assets\ (stocks. and 

bonds). I ma.de no comment and the matter was not referred to again. 

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(2) The present space occupied by the Hagelin plant in 

Rtockholm will be turned over to the Johansen Gauge Company, \.together 

with all of the C-446 tools, jigs, and dies; these are to be ·held by 

Johansen on loan until the order for the 500 to 1,000 C-446' s \.has been 

completed. These tools, jfa:a, and dies, together with certain\ machinery 

will then be shipped to 7.ug. The Johansen firm is to take over and 

employ all or most of the Hagelin workers in Stockholm, except Chief 

~ngineer Nyber~, mentioned above. 

d. (l) It may be well at this point to set forth speci:f'ica1ly 

the different models or ma.chines which are compt1sed in the C-line, 

usinp; designators which the HagelinA and I agreed would be suitable. 

The C-line ma.chines a.re readiiv clo.ssifiable (accordinp: to Hageli11' 

Senior) iato two ma.in classes: 

(a) Class 1 -- Where all keywheellJ advance the same 

number of steps. In the case of' the M-?09, of' tl:ie C-446.L and of a. 

certain version of the C-5?, the advance iA one step. Li:Ia.gelin Jun:l.or 

asked me: "What if some bright :fellow came to us some day and wanted 

a r.-52 that would advance all the keywheels 2 steps, or 3 steps, :rmcybe'l 

Then whe.t?" I said, "Well, I g11ess that would be more or less up to 

you. wouJ.c!n' 1; 11; T "~ I 

1 

I nade no comment; In this~s the machines are not to be equil'J!"d 

for operation with a one-tin~ tape (OTT). 

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(b) Cla.ss 2 -- Where the stei.lping\iS irregular and 

where OT!' readers are proviued, as we.Ll as equipment f9r producing the 

tapes. 

(2) Based upon the foregoing categorization~ in Class 2 

there are the following models: 

(a) CX-52a.: I 

(b) CX-52b: I \, 

{c) CX-52c: The mouel which is compatible with\.the 

old types of C machines, the-M-209, t.he C-446, or a certain version\of 

the C-52 ma.chine; 

(d) CX-52ak: A CX-52a\ 

(e) CX-52bk (or CX-52ck): These are likewise the 

same as CX-52b and CX-52c but°"with the therein; - - .._ ______________________ ..,.....,.......,.. __ __. 

, (r) CX-22/10 a.ml CX-C,:?/301 These ,:.:-:~2_:_:_i_:_·~-\\,....--

can be 0£ the a b or c t a.nd ca11 also be r.ovlded with 

C-446, 

Example: CX-)2~10 

(3) In Class l there are the following models: 

(a) C-52: The model whlch ls compatible 

but also can be ma.de tol "1th M-2091\Ddl 

(b) I presume that. there can be a. C-52/ 10 or c-52/30 

but these were not mcnt.loned; and at. the moment. I do noL i·ecalJ. asking 

whether thcH"t! coulu be a C-'.,>2a, or C-~2b, or C-j2c, or C-52ak, etc. I 

could no doubt aocert.a.in t.hls -point. t>asily cno~nby asking either of ·t.he 

Hagelins. 4 

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e. (1) However, there is a new C-52 ma.chine. whic.h is of 

conslderable interest, and which lJagelin Junior rnentioned. with much 

enthusiasm. This Jb.odel we agreed to call the C-52Y. 

2 

Perhaps the best way ·o exp an 

what this model will do is first to mention what the M-209, .or the 

C-446 or the ordinar C-52 does. In each of these models if 

0 

:for 

ow 

these 

s ype o ac ion, w ic was conce ve on 

recently December 195 , can be brought about in the C-52 merely by 

placing standard B slide bars in the cage in a certain sequence and with 

a certain kind of' lug assembl:f• 

(3) Hagelin Junlor was so enthusiastic about this new 

model that within two or thre•~ minutes immediately following our initial 

exchange of greetings he announced that they had decided to stop making 

the ex model and are switchin11 over to a variation or the C-52 which, 

he said, "is simpler in mechanical effectuation and more readily adaptable to the crypto-control mechanism for the HX or electrical-rotor 

ma.chine. 11 I was, of' course, rather startled by this statement and 

later queried Hagelin Seuior 1:1.bout it, saying that I was astonished at 

the decision to switch to the C-52Y bet'ore any security evaluation at 

all had been made of i·t. Hagelin Senior said "Oh Bo is oun and 

overflowin with enthusiasm. 

Hagelin Senior so.id that it was easytoconvert a 

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C-52 to a C-52Y and \ 

(4) A few minutes later Hagelin Senior read me a paragraph froltl p. recent letter :from the Italian defense depart~nt1 in 

which S:b \f&ll stated that they were withholding an order :t"or new Ha.gel.in 

ma.chines until more becomes known about what had been decided with 

regard to the various levels of' NATO communications. Hagelin\Senior 

wanted to know whether I thought there was a. possibility that a Hagel.in 

DlB.Chine might be adopted for 3rd level NATO .c:oJ,\llllUnications. I \.indicated 

that this was certainly conceivable and that that wa.s why I was\so 

interested in the proposed shift t'rom QX-52 to C-&52Y manufacturing, f'or 

I pointed out to him that NATO CO.MSEC authorities would have to be sur.e 

of the security of the new model and that detailed studies would certa:Ln:cy 

have to be ma.de of the C-52Y before it could be iven serious consideration for ssible NATO us e. 

f. Following is information regarding sales of ma.chines of 

the C-linei 

(1) E~ -- now negotiating for 50 C-52 ma.chines. ·They 

also wa.nt 10 BC-52 machines. They are waiting until an agreement oa.n 

be reached. as to prices. No final decision bas yet been reached, either, 

as to whether their machines are to have Roman .!Ir Arabic characters. I 

(2) Jordan -- has bought (about) ~O ma.chinesJ 10 ar~ C'-52'& 

and 20 are BC-521s. Hagelin is going to make delivery soon. He said: 

"I have a very good agent there. These ma.chines are f'or the Arab Le 

and the Forei Office. 

(3) !t!!!, -- The ifa.gelins have no agent in that country. 

There seems to be no interest there in cryptomachines, according to 

Hagelin Senior. 

(4) fra.q -- is negotiating :for an order ot: about 50 to 

200 C-52's with Arabic cba.racters. "They have a more than lukewarm interoa.t." 

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(5) Syria -- has recently purchased 50 c-36(sic) machines. 

I asked Hagelin Senior where ill the world he found so nn.ny of that old 

hiodel; "We had so~ down in the basement in Stockholm." 

(6) Saudi Arabia -- only some correspondence exchanged 

recently. Hagelin has no agent nearby. 

(7) India. -- wa.13 shown only the C-52 model. The Hagelins 

felt quite certain that the Inclians will order some of these machines, 

and they are also definitely interested in the BC-52. Lliagelin Junior 

on his recent trip, it will be recalled, did not demonstrate the CX-52 

to any of the Arab countries, nor to IndiaJ. .~"The Indian Army ls 

interested in these ma.chines, too. They want to have a lot of BC-52's 

for test purposes. Don't you think. tho.t queer?" I said that it seemed I 

a bit unusual to ask for a lot of ma.chines merely for testing. 

(8) ~kistan -- is waiting for a model of the C-52 for 

Hindustani (which has 29 or 30 characters). 

(9) Belgium -- The Armed Forces have ordered more than 

200 CX-52's and about 160 have already been delivered. These are 

CX-52a's with variable typewheels. The Bulgian Foreign Office have I lbut have bought 100 variable 

typewheels. 

(10) France -- 11~rhe French have had the CX-52 two years 

already, for study. 11 The Foreign Oi'ficc has pla.ced an orde.t• for about 

100 ma.chines; 80 CX-52!!,J 20 CX·-52!/10. £'rThe Armed Forces arc much 

more interested in the HX ma.chine," Ha&elin said. I will have more to 

say about.France later in this report.:} 

(11) Portugal -- bought five CX-5~'s: 

(12) Ita1y -- no action yet. "They are 'bellyaching' 

about 'what will NATO do. 111 Hagelin Senior stated that endorsement 

of the CX-52 would serve as a real stimulus to their placing an order. 

(13) Greece and Turkey -- have been given literature and 

a.re interested. Hagelin Junior is suppo~ed to have gone there long ago 

for a selling trip, but has postponed the Journey -- no date mentioned. 

(14) Holland -- The situation with regard to the Dutch 

:Is interesting 1n riew of the Petersen Case. They are sticking to tl!le j _ this j_s certainly true as regards the Foreign Office. 

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tl1eseo..r£: for the\ Dulcn Government. 

Most of these JDD.Cn ices ar~ for t.ne 1Jut.d1 Furr.lcn Of'f ice but; a c;ood many 

are also 1 ntenilc•d for tnc rtcn Armv. / Accord i nz .·tu Huge .. • 11·. n s~nlor I the 

Dutch Foregin orr ice r lnds ~qui t.c so.t. tsrac l".Ol'y. brca.uoe I as they 

say, (o.) they aru well orga.n.i.zeu now for using tnat model\and (b) the 

new mode.Ls are much raore ~xp:msivc than the old ones. (Hogelin Senior 

commented thn.t Dutch tur~fl. rcac:.i.s iwvlng I.ti JXl.Y mure than. P1ex t.h1nk 

warranted.) Howcv..:r, "i.:'uucl1 l.nc Dul.c•1 Furd;:;n orr i cc llkesl I 

it wants a certain nun10c1· o!' tnt>i1i Ito be }Jruvld.ed with means 

tor using one t.!me-tapc control 01· t.he steppins rr.echanlsni instead ol 

pin-wtreel control. The d~velopmcnt. of the ta~-contro.I mechanism bo.s 

glven Hagelin some trouble but the problem ·"8.s rccunt.ly solved. Haaelin 

Senior stated that t.ne Dutch Arrn;y ls much interested in the new CX-52 

model and wauts to obtain &,plDE' machim•d or tha.t type as well o.s a number 

of BCX-52's. 

(15) Unlt.ed Kingclom -- "The Brit.lsh bought. tvo CX-52' s. 

They pa.id for them, mort!OVcr, ln .Fr..=u Swiss Francs and they\d!dn''b 

relish th!s." 

(lt;) Germany and Austria -- Dr. Uell (who by contract 

supplies the West GerlllB.nS and Wt!st. Austrian market tor C-line. machines) 

has assembled ten CX-)2's i'or the Bonn Government. These are\CX-52bk 

type, -- "the only 1nodel whlch is u.pprovcd by Huettenhain." £The - personal relations between Hl~ll and Hagelin are still very cordial and 

thelr contractual relations are the same as reJ.e.ted in rrry previous reportJ 

( rf) Swe,len -- is going to i•cple.cel Ima.chines 

with CX-52' s in a Jol16-tt~t·m replacerr.t?rit progrwn, wi t.h a more or less 

.tixed amotlnt of" 1noney nva UahJ e c1.1.ch yeur 1'or this purpose. I asked 

lfaselin Junior wh8.t. t.he SwedJsh Govc.arnmcnt.'s react!on bad been to tbe 

decision to move the Stockho.1.m plant t.o ~ui..:;. Hie r~ply: "They don't 

like it, of courst•, but. have become reconcilecl to the idea. What else 

could they d.oY" 

(18) 

no order as yet. 

Spa.in -- ha.a s!'1own a grt~at inl.erest in C-52 but has placed 

They are also lnturest.eJ. in other new Hagelin products. 

(19) Eire -- has r·ecen:.!y placed o.n order for two CX-52' a. 

These a.re soon to ~elivered. 

(20) 111doneslo. -- "We had quit.e a messy bus:lness correqpondence, back and forth, Dlli.. now t.ht.y have finally declded to place an order tor 

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20.or 30 C-52's. The order is not firm as yet -- thg are.waiting to 

get thi:t appropriation and also an import pcrmi t." LI failed to ask 

why an import permit.J 

{21) Poland and H~ary -- Chief engineer Nyberg ln 

Stockholm recently sold. 2 c-44bma.chi.nes to each of these two governments 

without first consulting Hagelin Senior, who said that they ha.d. inclicati11:d 

requirements for many ma.chines. I asked what he would do ir th.e real 

came throu h with firm orders in uantit • 

I will add that in telling me about .:these recent Polish-.. 

Hungarian purchases Hagelin Senior commented: "Rossby Lcivilian head of 

Swedish COMINT opcration!J" told me he Q.idn't think the Russians help\or 

would help the Satellites with cryptographic advice or material." I 

ma.de no comment but would have J.iked to have asked Hagelin the basis tor 

Rossby's feelings or knowledge in this connection. 

(22) J oslavia -- interested in the C-lines. elin 

Senior said that 

{23) Central America -- "There's not much interest there in 

our ma.chines. Costa Rica recently bought two c-446's; Cuba showed some 

interest at one time but this has died down. wd have illMexico a good 

agent with Norwegian background and he wants to sell some ma.chines to the 

Mexicans. Venezuela is going to buy some ma.chines." 

{24) Brazi~ -- The Brazilian~ is.interested to the 

extent or some 500 or more ma.chines but Hagelin qenior didn't think 

they would come through with as large an order as this in one lump. 

The Brazilian~ has bought 60 CX-52's, these to be compatible with 

their C-446 1 s. When they will put in an order for more machines these 

will be of the CX-52 type. 

{25) Argentine -- The Navy bought 13 CX-52' s but these 

are to be compa.tlble with the c-~4o. 

{26) Chile -- Not. greatly interested but will buy some. 

{27) Peru -- Inl.erest.ed to the extent of about 200 CX-52's. 

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(29) Uruguay -- bought five CX-52's and two BCX-52's. 

"That's their firs:t experience with cryptomachines." 

(30) Colombia -- has ordered about 100 CX-52's and about 

4o BCX-52's. 

2. !:.• In discussing with both ~elins the matter of new develop-

:rncnts in crypto-appa.ratus and their sales promotion, they both stated 

tha.t they are sometimes confronted w!th a considerable amount of sales 

resisto.nce which arises from excessive nationalism and which makes it 

difficult for a country to accept ma.chines invented or manufactured in 

some country other than its own. France, tor instance, wanted to use 

only such mo.chines as were invented or ma.de in France. /Jb.is statement 

makes me suspect that the French have told Ifagelin about the ma.chines 

furnished them recent b the U.S. and the U.K. • 

b. I said to Hageli11 Senior that Boris Junior had told me that 

his father bad again been to Paris recently and that I imagined it was in 

connection with the modification to the B-211. When he nodded affirmatively I said that I was e;la.d to leo.rn that he was trying to help the French, 

for they were our allies in NATO. I asked him if he could give any reason 

for the recently heightened interest in crypto matters on the/part of France. 

He said he thought that increased interest was a result of V:l.ala's coming 

into the picture in the ~oreign Office. Viala* wanted to replace the 

*Hagelin said that there is another, unrelated Vi.a.la in the crypto 

business ~or the French DeP3-rtment of the Interior. 

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old.,fo.shioned methods and 1''orci{5n Office cod.t•books with more up-to-date 

thlngs. Via.la is a forceful C'ha.ra.ct..er, he said. But he added that · 

Via.la, of course confines his actiYitics ln this reeard to the Foreign 

Office. He:!'wcnt on to say that tho "Commision de Chiffre" und("r Presiden~ Ollier is now very active. Captain Mueller, a meriber of the 

.Commision, ropresenti.ng the Presldence de Conseillers, is also very 

active. Olller is o. man 40 tc> 1~5 yea.rs of age, rat.her cold but Ha.gelin 

slzed him up as belng extremely intP.lligent and a. very strong character. 

Hagr~lln said he could l.ell rne about sonr.e very important French plans for 

improvement in ccypto affairs. For one th.tng, for example, the French 

Government ls going to establish a plant in Pa.:r:is but as a. private enter• 

prise. "There ia plenty or money behind the peopJ.e who a.re prepared to 

do that. The Government will buy the tools, since they want to be sure 

to have all the tools necesaa1•y for manufncturing their ma.chines, but 

the plant itself will be under private ownership. This ownership will 

probably be that of' a subsidary of an already well-established firm called 

the Societe Electronique Autornatiame (SEA), which, though a relatively 

new firm, is already a very lmportant concern ma.king electronic computers. 

Its president is M. Raymond, Ei. young rnan but supposed to be first in 

France in technical l01ow-how as regards such ma.chines. The people behind 

SEA have plenty or money -- they a.re considerably higher up in Government 

affairs than people like Color1el Arnaud, who is constantly being J:"q.eedled 

by Ollier to get busy on thio crypto manufacturing business. The •plant 

will start with llltl.klng me (electri.c rotor) ma.chineo; possibly also ex 

ma.chines." 

c. (l) The B-211 rnodificuLion, designed ' and developed by the 

Ha.e;elins,-has turn~d out to ue quite successful, according to Hagelin 

Senior. What J saw of' this development (in Paris last September) was 

merely a rough desie;n; they J:i..ad worked lt out in pro.ctice so that' it can 

easily be added to the~ existiilg B-211; h.ls agent in Paris (M. Rene de 

Chauny) will probably do the work on the machines when the latter arl}., 

sent to him in batches for servicing. The Hagelin f'irm had an order for 

250 B-211 modification kits for the French Army and 200 will probabJ.y 

be ordered by the French Air Force. "Captain Mueller told me that with 

this improvement the modi!'ied B-211 will be more secure than the origitial. 

British TYFEX" (meaning, Hagelin said, the "type with the simple reflector -- not the one with the straight-through circuiting and reversing switch"). 

Hagelin commented that the French hacl something on their B-2ll's which 

was not put on by him and hence he didn't know what it was. The parts fdr 

the modification kit will be made in Zug, either by Crypto A.G. itsel.1" 

or by a sub-contractor in Zug. 

(2) I asked HD.geJin Senior whether this modification kit 

tor the B-211 would be available to other owners of that machine. "Thete 

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aren't a.ny others now." "Oh, but we have some," I said, to which he 

made the laconic comment: "Yes, two." I said: "Yes, and you will 

recall also that:. I have one personally, one you preaented to me for 

my collection -- 1:.1\e one formerly owned by Ivor Krueger." Then he 

'Went on to say that he would do the conversion in Zug on our two or 

three ma.chines at such time as would be convenient. 

3. a. Relations wil:.h Siemens and Hn.lske are now formalized in 

a signed contract. Siemens agreed to stay out ot' the Cl'yptoma.chine 

manufacturing business nnu confine itself to ·the teleprinter rna.nut'actur• 

ing business1 Hagelin agreed to stay out of the teleprinter manufacturing business and confine himself to the cryptoma.clline manufacturing 

business. In case in the future Siemens wished.;-to go into the cryptoma.chine ma.nUfacturing business they must give Hagelin notice thereof 

and tor at least one and a half years after giving such notice they must 

stay out of such 1na.i1ui'acturing. 

b.. Hagelin Junior showed me the la.st page oi' tho contract 

with Siemens, in which t~e marketable areas for teleciphering ma.chines 

were divided between Siemens and Hagelin as follows: 

(1) Siemens a.lone : (2) C.r;ypto A.G. a.lone: 

I/est Ge~l France 

West Austria ita.~ 

Jugoslavia j Europe Switzerland 

Portugal Sweden 

Ir~~land Norway 

Benelux 

All except~ Brazil, USA, America Brazil 

a.nd Canada. 

All except Egypt Afr tea Egypt 

All except Indi~ Indonesia, China. Asia India 

All Australia 

(3) Siemens and Crypt;o A.G. together: 

Demar1 Greece Europe 

Spain 

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Indonesia Asia 

None America or Af'rica 

(4) Areas not yet assigned or clearly agreed: 

Finland 

Russia and all satellites 

East Germany 

Chins. 

USA and Cana.els. 

4. Rather casually, I asked Hagelin Senior, but in the presence 

of Hagelin Junior 1 why 1 if they were 1noving the Stocldlol.m plant to Zug, 

they hadn't considered moving the whole business to the U.S. He replied& 

"You'll have to ask Bo about t.bat." I said, "Why Bot" Boris Junior 

answered somewhat quietly: "I suppose he means :f'or me to carry on the 

business. What would be the advantages of' moving the business to the U.S. t't 

I said: "Well, I thought you didn't like Switzerland at all, and the same 

goes for Edi th, doesn't it 111 His reply: "We' re both getting better adjusted to living in Switzerland. And then soon, when the Nybergs have 

settled down among us, we'll have some agreeable company." Hagelin Seniors 

"I suppose the U.S. could and would bind me with restrictions so I couldn't 

be free to export where I pl.eeLse." I said that I supposed that certain 

things could be done along th.ELt line -- there were, of' course, restrictions 

on sending instruments or war or materlal for Wa.r to countries behind the 

Iron Curtain. But I added that I didn '"t thinlt the U .s. would be tough or 

have a. vew:y rough policy. I did not pursue this subject any further, nor 

did they. Later on, Hagelin ,Junior's wife (Edith) confirmed that she was II ' getting better adjusted: It takes a couple of years, you ltnow. I was so 

upset last year that my doctOJ:' sent me to a psychiatrist but after the one 

and only one visit I made u~ !u;f mind I didn't need such help and would help 

myself out of the spell. 11 lflhe did look much better than when I saw her 

last September;/ 

5. a. The new base for the BC-line {electrically operated keyboard machines) was shown me. It looked extremely simple and compact. 

Any C-52 or CX-52 need merely be placed inside the fro.me and fastened 

down by two screws, thus becoming a keyboard ma.chine. To adapt the ba.se 

to take a c-446 or an M-209 requires some modif lcation but Hagelin f'elt 

that this could be done though he questioned the practicability of doing 

it, because the shaft on which the keywheel assembly and the print wheel 

13 

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is borne ln theoc models is too short. 'l'his new BC base would facilitate 

op~rntion by OTr an•l the sensjnc part, of' the mr"!cha.nism for opera.tine; e. 

C-52 or a CX-52 (01·, eventua.l.ly and poSlllbly o. C-ll-46 or M-209) by mc~a.as 

or O'.L'T io now wo,..ked out so l.ha.t the sa.11E~ mechanisr:t wlll do for o.11. 

b. 'l'his new base for the BC-11 ne will coot about $800. When 

I connncnle<l. Lhu.t I thought t.hn.t. a pre tty stiff pr.ice for wha.t was shown 

me, Ho.geJ.in Senior ruplicd thn.t he unuaJ Jy chargetl what t.hc traffic 

would bear but; at l,hat. price the coat. 01' I.he 'base plus the cost of the 

'C or ex machine itself, the t..otal cost w!i.L still be le~rn than that. of 

thr? old BC-1i4G, which wn.s 8,ooo Swedlsh Kronor,_ wherea.s the cost o(' the 

new base plus t.he C or CX 1"'omes to u.boul. 6,000 'Kronor. On a bie; ordol' 

for BC m'J.chlnes he woulrl, or cou.rs~, makr? n. pr lee adJust:ment. 

c. The B bo.ses a.re now \ming mn.<le ln Gl.ockholm (a.bout 25). 

~Zug will begin mu.kine; them .ln a.bout, 10 mont.hu, according to the Ha.gollns. 

d. I am incllnccl ·t.o l;hinl( tho.1. I.he new BC-ltne with OT'r 

opP-ration; combined wt th the new c lecl.ro11 I c O'l"l' rnakin~ machine which 

Crypi..o A.G. has Just produced (sec puro.gmph 6 below), could conatltute 

n very serlous threa.1; to tht? UKUSA COMJN'r Pffot•t if not undc.c some 

cont.rol with a view to consi?rving what rnlp,ht. be left of' COMINT a.:rter .NATO 

countries' COMSEC needs at·e met. 

G. One electronic OTT aencrat.or, cu.Jlnd the ZG ma.chine (Zufalla 

generato1· = Random genenitor), wo.s designed anu ,built in the Zug research 

and development plant Jn f'ive months by Hugclin engineer Sttlrzinger. It 

we.a just recently turned over to the Frcncb Foreign Office for study and 

asoessmcnt by the Commision de Chiffre. No teals for randomicity were 

made by Hagelin. This model ur.es a Creed pc. t'f'orator a.nd produces one 

original and one copy. It is not equipped wlth marking apparatus whlch,, 

Rae;1~ lin Senior said, 11 i a the he a.rt of the Job. The• Franch arn going to 

work that out. 11 He cxi)ects an orc.lcr !'or sevc•ral more of' these O'IT 

genera tors from the Fre11ch. He also is making 3 or 4 for Denmark, Danlsh 

Navy Captain Weilbach being much interested 111 thls ma.chine. Belgium has 

also placed an order for one ma.chino. 

7. a. Crypto A.G. (Zug) hns mn.d.e po.rl.r; L'o1· a rirat series· of ten 

OTP producing machines (CBI-series) and one mo.chine was assembled and 

operated for me dw·ing my stay in Zug. The machine is astonishingly 

small in size about 1 cu. ft. but wei hs I estimate about 50-60 lbs. 

7 to 8 

lines per m nu e. 

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b. Of tl:ie 10 :ma.chines constitutl11g this l'irst series, 7 are 

already sOld, to countries as follows: 

u. Italy s. J ~ortugal l each 

:Belgium. 

France 3 

Orypto A.G. hasn't tried to sell SXJY' more ot these aa yet. Ha.gelin 

Junior mentioned that in his ta.lk.s in India. he lee.rned.tbat\the Indians 

are now using IBM for me.king their OTP's but became much interested 

in th~ new Ha.gelin OTP ms.chine. A retired general officer\ (Indian) 

came recently to Zug for a look-see.* There is a. possibilii;y tha.t.u.s. 

will buy one or two more. The lst ma.chine ':for the U .s. wil.l be ready 

f'or delivery in l - 2 months. 

II 

o. Hagelin Senior said that Dr. Huettenbain had tested the 

end product of the protot;ypa CBI ma.chine some months ago and stated 

that the letter Z was unbalan~ed compared to the rest of the letters- . ' ' elin Senior said this had been corrected to .a. large degree but ill. 

two aepa.ra e mac nes 

would be tered and they wou be as er, a p er, and produce a :100re 

random end result. Hagelin Junior told me that they weren't going\to 

make any profit on their first 10 ma.chines and I, imagine the;y· would\be I \ I glad to sell them all. Hagelin Senior asked me if u.s. could use l!lOre 

than one. I said we'd want to test the end product of our first one 

as soon as possible and that :l.t might be that we would have use fo:cseveral if they were really good. Hagelin Senior then reminded ma 

(which reminder I didn't need) that General Canine had once indicated 

we would buy at least a couple. These machines are expensive (about 

$5,,000) but, o:t' course, practically all the parts are hand-made. However, ama.ll countries would not need more than one or two such ma.chines-.:... 

*Hagelin Junior said the Ind.ie.n Signal Corps is also interested in 

-the Ha.gelin teJ.ecipherixig ma.chines. 

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as the Foreign Office conmu.llications of these countr.ies\.are. concel'ned. 

8. e.. '!'he stat.us o"f the me: tlevelopnent was discussPd. Sor4c 

progress has been made in regard to the type of rotors tha:t will be 

used; Hagelin Juntor talked about their using printed \circuits, a. 

iiiatter being investieatecl rm~ them by an Engl lsh firm \the name or 

w c s t mentioned nor did I asl{ for it. The new\.ma.chine\is now 

as e ge in en 

wh~ther the HX-5 was to be a. -c re.c ·er ma.chine and, \if so, what 

he proposed to do about the 6 extra characte~s.; (This question was 

o.lso asked in the course of evious visit.) He told me that these 

I wondered whether I shouJd ask him if e 

for pa.tent coverage on this idea but decided not to ask. 

has one :l.n secret status in the U.S. Patent Office:] 

b. Two prototypes 01' the IlX-5) wlll be ready before June 1955; 

fhere will be three crypto-components t'or these, that is, there will be 

bne spire crypto-coinponent, for test purposes. 

c. I told Hagelin Junior that the sooner they could\get us 

an HX-55 the sooner could an answer be given as to the security of the 

machine. 

d. The Hagellns demonstrated a. bench n\odel of the slide bar 

and rptor-drive mechanlsm for the HX :ma.chine, using the C-52Y principle. 

~hie component'was very qutec ln operation and quite rapid. However, 

the unit used was the same 5-rotor assembly that was in the HX-54 I 

saw on my visit last Sl~ptember, not the new proposc;d 10-rotor assembly. 

9. a. Ha.gelin Senior has definitely given up the idea of having 

"a single - pa.ckage ma.chine, 11 ·that is, one that can be used both for on00 line 

teleciphering as well as for off-l~ne llteral operation in a single 

apparatus made up of several components. He (~ave up the idea "because 

(1) it would take much longer to develop than ha could afford at this 

·Juncture of hie research and development; and (2) the Siem.ens people 

didn't like the idea and I don't want to buck them." Hence, he is going 

to have one off-line literal machine which might be the HX-55 or even 

HX-~6; a,nd a separate on-line teleciphering ma.chine. 

b. The flrst model of his on-line ma.chine •rL-55 or 56) will 

controlled by 01'1'. The second model TC-55 wlll nlso use baud addition. 

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but this will be controlled l)y the same cryptomcchanism and principle 

as that to uc incorporated ju 1,he C-52Y; the thircl. model, still an online tcleclpherine ·ma.chine (TCX-55) wilJ. use the c:ryptoprinciples or 

the CX-52 ma.chine; and. · f u th odel TH-. r· or 6 will use 

the me crypl,oprinciple translators). All of ... t ... hc__,l ... a"'"'t; .... t-e-r ........ .-----.---. ......... .......----..-----. ........ ---.---.w .... i .... l ..... 1-a"'"'l,...s-o---b ...... e 

9pera.ble by means of OT".r. F..a.gelin is tryinc to produce prototypes of 

the new teleclphering machines o.s soon as possible, but so far they have 

only sketches, not even good drawings. Still they hope to have proto-

- types this year. 

c. Ha.Belin Senior "told me that. he waa· going tCI\ try to eliminate 

· rotors from the 'l'H-56 and use relays instead. He thought that with 

about 400 relays he could accomplish what the rotors do. He did not 

mention the word "electronic" in this connection, nor did\!, of course. 

d. No more of t.he present TC-52's or TL-52's will\be 

produccd;-of the former a total of 20 was to be ma.de and these have 

been completed; of the latter, a. total of 50 was to be made but 

only a few have been completed. These ma.chi.nea are i'or the French 

Fqrcign Office, Army, and Navy -- no Air Force, because they a,re tied .~up with SAGEM which ha.s recently i1nproved its model but still uses the 

~ cryptoprinciples em11loyed by Hagelin in the prototype he built for 

~ ,SAGEM. (~'he u.s. hu.s placed au order ror one TC-52, and, I think, for 

o.ne TL-52. ) 

e. Ilo.e;elin Seni.01· stated that Esypt ana India. a.re interested 

in ha.ving-tel.ecjphering mu.chines con"la-olled by the C-52 principle,\and 

these would be provided wlt;h but, one tape reader not two so that •.the 

ma.chine could not be operated b • OT"r. 

10. a.. The new pocket cipher device (CD) appears to be well under 

wa:y and the Ho.gclins ure enthusiastic about it. This device will use 

a.lreo.cy bucn built. at St..or.!ld1olm; "i.t is 

radio ~et. I bouc;hl:. for him in the U.S. 

duce a pr.intc,l rccor<l 111.hi~ iirint tmi.t 

One keying mechanism has 

• i.e s ze of the transistorized 

l gathered that the CD will prois really very simple 11 ), but my 

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b. The history of this development rray be of interest. ]?art 

ot it was-related to me privately by llageiin Junior with the request I 

say nothing a.bout it to hls fat.her. According to ~elin Junior, many 

ot their customers for several years in the past have importuned the 

Hagelln firm with the request lihat they be prov~ded with a pocket-size 

cryptodevice, and he (lfagelin Junior) had in 1951 or thereabQuts 

:proposed a machiinism for such a. device -- the same or nearly the same as 

that incorporated in the present CD prototype. .But Hagelin Senior was 

not interested in such a project and rejected.. HS.gelin Junior's\ideas -- until an ex-Ha.gelin employee, one VIGO LINDSTEIN, came out recently with 

a pocket-size device. /Jiote: This is the T.RANSVERTEX device the Sw~diah 

Government turned over to the Norwegian Government, which turned\it over 

to NATO COMSEC authorities; it is now being given security studies by 

I I How the Hagelins learned about the Lindstein device is not known 

to me; it is held in a secret status by the Swedish Government and\has 

been from the beginning handled as SECRET in NAirtj I so far\ as 

I am aware:] When Hageliq. Senior learn~d of the Lindatein device, he 

then became much interested in such a project and soniehow or other co,nsidered tne ideas originally proposed by Hagelin Junior as his own. 'When 

Hagelin Junior11 1earned that Ho.gelin Senior had decided definitely tp tur· .. n 

over the Sundsorbrick manui'o.cturine; works to his other son (Gunnar), 

Hagelin Jl-\°ior said to his rather that in view of what he was doi~ for 

Gunnar he >Should at .least turn over what royaltirtts there would be on the. 

new CD to t1im (Junior.); whereupon his father went into a rage, apparently 

claiming all credit for the CD himself. 11 It's not nice o:f me to sa,y this 

much about the matter, but tha;G' s the way it was. 11 

- c. I asked Hagelln Senior what usages he could foresee for the 

CD. He i'elt that secret agents, suJ0.11 military units, or patrols could 

find good μse for it. l 

11. a., In connection with the 

to be used' in the proposed fourth\mod ....... e .... l-o .... f-t ... he-o-n--"""1 ..... 1-n-e ........ t-e ... le-c-i .... p"""h-e-r .... i-ng------' 

ma.chine ( THX-55 or 56), a principle which incidentally the U.S. uses in 

one of its own new developments, Hagelin Senioi• stated that he was· ai'raid 

he was going to have some difflcultieswith the Lorenz people in Germany. 

That firm has a German pa.tent {elsewhere, too, I think) on the means .for 

accomplishing or using that principle, appl"lcation for pa.tent having been 

entered in 1943 and just recen·Uy granted (Janua.ry 1955). Hagelin Senior 

showed me the Germa.Ii patent and he is: to send~ the numbers of the whole 

series which Lorenz has in Ger1na.ny and in other countries on this translatpr 

18 EO 3.3(h)(2) 

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mechanism or on other ite111B or interest. ffea.turo.lly, I did not say any· 

thing to Ha.gelin al>out o\U' use or the t..re.nsla.tor prlnci.ple but I am b•!ginninc to wonder wh1.?ther the U.S. nny not. have similar trouble with Lorenz:] 

b. One Lorunz pn.t.ent.., o.lso cntere,\ ln application ronn in "L943 

and granted iri 19~5 was 1 howeve1·, killc.··l when Hagel in showed prior uuc oi' 

the :Lt.em. I am to gttt tha.t 1utont, lioc.1. 

12. !:,~ With refcronco t.o what thE~ Bonn Goverument may be do.lng now 

with the Huettenha.in crowd, Haccl.ln Senior said he was told that for Bonn 

there would be "a. small ma.china ma.uc by Dr. He.1.1. '.L'ha.t. would, or coux·s(l' 

be our own machine, the C.'X-~2blt." But I.here' woulcl al.so he "a la.1·ce mchine, 

ma.de not by us nor by Sl<:mons, but. proluibJ y, I think, by Telefon und 

lformalzeit (T & N Co.)." Ho.gcltn uaicltl.hnt he d:ld not know any details, 

for those were classified. I u.skPJ: "Couldn't it be Lorenz l'ather than 

T & N'l" 11 1 don't really know, 11 11 .. i·eplll·d, "It could well be. l suppose 

Lorenz did some work on uryptoma.chines J'or the Germans during the war, 

just as di<i the firm WANDEHl!-:R ln wha.t it1 now East Germany. They stolu my 

c~lpher pJnwbeeJ. o.nd sHcle-l.10.r-wit.h lup;a Ideas and const.ructed o. ma.chlne 

in 1941~, you know." l!Jhe SG-l~J; Hagcliri has one of these in his ot:f'J.ceJ 

£.• In a later talk with Hap;clJ.n Junior he asked me whether, 

with West Germany now or soon to b~ fre~. they wlll establish laws, 

such as in Sweeten, prohlbi1. i ng cxporti nt:~ c:erta.ln kinds of equipment to 

cert.a.1n countries. I told him I supponcll they might well do oomething 

along those l.tnes. He aske1l me to send him, if ,posoible, what lnforrm.tion 

i.here wo.s and which could be ma.do avallo.bln wit.h reference to such prohibitions. 

It seems that the Hagcllns a.re worr1ed a.hout the competitlon they might get 

in future from such firrns as T & N, or the one that made Enigmas; 'if' West 

Germany wbuld place a ban 011 P.Xport:lng cipher machines the Hv.gelins would· 

i'c•cl much more secure against the poss:ibl l l t;y that.• BU<~h firms "would peddle 

their machinea a.brond and give us serious 1.•ompetitiou. 11 I so.i<l I'd nee 

'Wht.lt literature or documents weirC' ava.Llnblr to send them for inf'orma.tion 

on exporting bans. 

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III. 'l'HE APPROACU TO HAGELIN .AS At)THORlZED 

IN USCIB: 29.14/29 Olt' 

27.DECEMBEH 1954 

., ' : 

.. 13. a. Having been with the llugelins f'or several. days, :hi a. most 

amicable relat.ionship, on the evcmtna ol' 25 Feb.t·ua.ry ·19551 ol'ter dinner, 

I felt the tlmc ho.d come and wo.s propi. t.lous to bro13.ch to He.eel;in\Senior 

the subject authorized in USCIB: 29 .14/29 L"i.nd, of'. course, t.he \l'e11l 

object of my visit l.o Zug:J. 

b • 

........,,....-------,,,,..-...,.....,.......,......,.........,..--..,...........,..---....-...... therefore, on behalf or my Government I winhccl to thank him f'or thnt.. Seconclly, I told him that we 

were well nware of his disinclina~ion to be aid mone 

thin was in line with his :J.dcas of" prop•.?r conduct, anc we un erL..,,-ro~o~-c-in fec~lings in th.ls x·ega.rd and his relu.ctance to enter into any 

:t'clat:ronohlp ln which such a. feature would play a prominent pa.rt. Thirdly, 

I said, we ha.cl been strum~l ing t.o work out some kind of a proposal which 

ttould be sa.tisrncl.ory to us and p:!rhnps a.ccepte.blc to.him, and we had 

f'inally hit upon one which 'Wa.A sirnplr. and which I had .been authorized to 

plo.ce before him, if' ho was wl 111.ng l.o enter.tu.in a. 11roposal at this time. 

c. HD.ge.lln Senlor rc?spon<le1l by th.o.nkins me f'or what I had said 

about our-a.ppreciu.tion nnd understanding of his position. Moreover, he 

wanted me ,to know how th:J.nkl'ul and t~ra.t.el'ul he and his wif'e are for what 

we had done and were contlnuh"ig to do for various members of his family. 

He hoped that everythi118 would turn out well with regard.. to his son-in-law 

• Conradi and his retention on act.lve duty status i'n the USAF as a result ot 

our lnte:r.-vention -- "the~ yowlB man keeps assurine me that he is working 

like hell." HE! and his wife a.pprecin.ted very much what we ha.d done for 

her cousin (Mlas Barth) in ma.king a place for her in ourorga.niza.tion. 

Finally, ho said, he woulU. be 31.ad Lo hear what sort o:r a proposal I ha.d. 

now to place bei'ore him. 

d. I ther1 conveynd to him practi.ca.lly verbatlm the terms of 

the proposal authorized in USCIB: 29.1li/29, dated 27 December 1954 and 

I Ito the Chairman, ...,u"'s'""'c'""!B ...... - ... I ........ t-o .... ld ........ h'""ir-m---.t""'1-1a .... £-.-hc_n_c_e_d.--n-o .... L-g-rl v-a---.1"""1 t=-s-a._n_s_w_e_r....,..,tl .... ie_r_e ..... a.nd then but 

could take his time to think it over, if he wished. 

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e. Hagelin Senior thanked me but said he did\not need time to 

think .\:.helna.tter over; he was prepared to make an answer\then a.l:ldthere 

to out proposal: lie accepted it wi"l;hout any reservations\.or desire for 

modifications. But he would like to have some more details; he wanted to 

know 1 for exam le 

I told him I was not authorized nor able to give him more 

information on this score at this time but I had no doubt that such details 

would be forthcoming at the proper time. 

f. I thanked Ha elin for his 

and. said that 

However, he would appreciate it if' I would convey the proposal 

orally to Boris Junior iey-sel.i'. This I did the following day but by that 

time Ha.gelin Senior already ha.d a chance to tell his son very. briefly the 

substance of the proposal and of his own acceptance. Hagelin Junior also 

was ready with his assent. /J. do not think that if he had withheld his 

assent it would have made any difference in the situa·t;ion or to Ha.gelin 

Senior, for the latter had said, when he asked me to talk with Boris 

Junior about the proposal that even though his son was young, enthusia.atia 

and wanted t'o make nioney, he 11would be kept in line.':J 

"· g_. Both Hagelins wanted to know how the NA'ro purchasers of 

their ma.chines would learn what constituted "proper use" o!' them. I 

told them not to worry about that -- we would see to it.that instructions 

·ror proper usage got to such customers. I said I was sorry and I hoped 

they would not be embarrassed if they themselves, the producers of the 

ma.chines, were not'also authorized to be recipients of such instructions. 

J . 

h. Hagelin Senior felt that our proposal was a fair one for 

both sides a.nd wa.nted to know when it was to become effective. I told 

him that I thought that for all practical purposes it was either already 

in effect or would go into effect at once so far as we were concerned but 

I would let him know definitely a.bout thia ~oint later. 

· i. Nothing -was said on either side as to the term of the "understanding, TI" that is, how 1ong it was to continue in effect. 

J.• The Hagelins wanted me to identify by name the NATO COMSEC 

authorities; this, they said, would be of great interest and help to them 

in their business. I told them I could not do so now; I could only say 

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EO 3.3(h)(2) 

Pt.86-36/50 USC 3605 

·l;bo.t there 1n a !'d1:u.1.ry authority in Washington ~nd a DC?conclary one in 

Pa.t•ls. I a.okecl t.l•cLt thc:r be ieti.tmt in this rc.~rd 0.1111 1.hu.t it would 

-perho.ps be possible to sive them more informatitm later. In any case, 

it was not ~l who were to ask for any endorsement i\ but the NATO customer 

who had to take that action, addressing their inquiry themselves to the 

NATO COMSEC authoritiesJ they. would know where or whom\.to address their 

inquil•f. 

k. Ha.gel.in Junior said (but not in the pres.ence of his father) 

that up to thiB t:tme he did not ask. the office staff to make copies of 

all correspondence, orders i'or ma.chines, etc., for his ow dealt or use. 

But now he could see that such co tes wouJ.d be usei'u 

14. In my la.st report of a visit to Zug, I mentioned Hagel.in 

Junior's urgent desire to acquire a TYPEX machine which he could turn 

o\l'e:r to Mr. Rossby (mentioned above in paragraph lf(21)), who was 

anxious to obtain ona. HaBelin Junior brought this subject up again, 

said that Rossby was still very anxious to get his hands on a TYPEX, 

and that when he (Haselin Junior) learned an his trip to India that 

the Indians had some TYPEX ma.chlnes he tried to Get one from them but. 

was not successful. He went on to say that Rossby somehow or other 

80t hold of a copy of the in~tru~tions for operating the mo.chine but 

this, Rossby said, was not enouBh for his needs. Ha.gelin Junior said 

that he dfdn't necessarily have to have a machine in perfect operating 

coi:Pition -- one that worked only haltingly would do. He was quite in 

earnest about this and I think that if he could acquire a ma.chine through 

I I 

with Hagelin Junior, for, he said, "I am sure I could get f'or myself' a 

new automobile out of such a deal." 

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