Person interviewed:      Michael John Smith


Place of interview:        Paddington Green Police Station


Date of interview:         10th August 1992


Time commenced:        21:52   Time concluded:           22:08


Other persons present: Detective Superintendent Malcolm MacLeod

                                    Detective Sergeant Stephen John Beels

                                   Richard Jefferies (Duty Solicitor)


Beels:  This interview is being tape-recorded. I am Detective Sergeant Beels, New Scotland Yard, Special Branch. The other officer present is Ö


MacLeod:  I am Detective Superintendent Malcolm MacLeod, from Special Branch at New Scotland Yard.


Beels:  And you are sir Ö


Smith:  Mr Michael Smith


Beels:  And you are sir Ö


Jefferies:  Richard Jefferies, solicitor from Tuckers Solicitors.


Beels:  We are in Interview Room No. 2 at Paddington Green Police Station. At the end of this interview, Mr Smith, Iíll give you a form explaining your rights of access to a copy of the tape. The date is 10th August 1992, time by my watch is 9:52 pm. I must caution you Mr Smith, you do not have to say anything unless you wish to do so, but what you say may be given in evidence. Do you understand the caution?




Smith:  Yes I do.


Beels:  Do you agree that the tapes were unsealed in your presence?


Smith:  Yes I do.


Beels:  You are entitled to free legal advice, as you know, and your solicitor is present with you.


Smith:  Thatís correct.


MacLeod:  Yes, Mr Smith, I am going to come back to this letter from the man Williams. This is exhibit JS/40, already, previously introduced in the last interview. In that previous interview, you said that you didnít know who it is intended for. Is that right?


Smith:  No. I never said that.


MacLeod:  Or havenít I got that?


Smith:  No, I thought I said it was addressed to me, Ö


MacLeod:  Yes.


Smith:  Ö but I didnít know who had sent it.


MacLeod:  Oh I see, so you are now saying ...


Smith:  No, I am not saying. I thought Iíd said that previously. I am sorry if you misunderstood.




MacLeod:  Well, I am sorry if thereís any misunderstanding. I just want to get clear in my own mind. So you do agree that this was sent to you, and intended for you?


Smith:  I agree it was sent to me, yes. Well, letís put it another way, it came through my letterbox.


MacLeod:  It came through your letterbox. And the fact that it was addressed to you?


Smith:  I assumed it was for me, yes.


MacLeod:  Well, I think that is a reasonable assumption, and the fact that it was addressed to you by your Christian name, Mike


Smith:  Well, that is there for us all to see, yes.


MacLeod:  So, we are not under any illusion that that letter from Williams is intended for you?


Smith:  No, no. I donít think that is the case, actually. I think that is an assumption that it was for me.


MacLeod:  An assumption?


Smith:  It was addressed to somebody with my name, and as I have previously said, I believe the address on the envelope was incorrect.


MacLeod:  Well, the address on the envelope was addressed to Mr M. J. Smith. Was it not?




Smith:  We havenít got the envelope here.


MacLeod:  Well, Iíll produce the envelope in a later interview, but I can tell you that it was addressed to Mr M.J. Smith, albeit that the address might have been slightly inaccurate: 48A Burton Street Road, instead of what it is, but, I mean, thatís only just a minor ...


Smith:  You must admit though, itís a suspicious letter, with no ...


MacLeod:  I see nothing suspicious about it at all. I mean, itís got your initials on.


Smith:  Well, I see it as being extremely suspicious.


MacLeod:  Well, I think, itís only suspicious, because youíre not prepared to accept it was intended for you. And the reason you are not prepared to accept it was intended for you, is because, as I said previously, it was from your handler, was it not?


Smith:  No, it was not, I donít have a handler.


MacLeod:  Come, come. Right. We wonít labour that one any more, thereís no point. Letís go back to the money. The £2,000.


Smith:  Yes.




MacLeod:  Tell me once again, where that £2,000 came from. I just want to make sure that I ...


Smith:  Well, well Iíll reiterate, that itís my money, it was received as part of my employment.


MacLeod:  It was received, are you telling me now, it was as part of ...


Smith:  Itís part of payments for work that Iíve done.


MacLeod:  Can you tell me what work?


Smith:  Itís associated with my work at GEC Hirst Research Centre.


MacLeod:  Right, so they will be able to confirm that they made payments to you amounting to £2,000?


Smith:  I am not sure in what sense you mean that?


MacLeod:  What, I thought it was quite a simple question. You have got £2,000 that we found in the drawer in your bedroom.


Smith:  Yes, thatís correct.


MacLeod:  Now, previously, in the previous interview, you said that it was money that you had accumulated.


Smith:  Yes.


MacLeod:  Yeah, from sources, or should we say ...




Smith:  Letís not say sources, from means of employment.


MacLeod:  From means of employment?


Smith:  Yes.


MacLeod:  Well, why didnít you say that that was money that you had received from GEC. Why didnít you say that?


Smith:  Because indirectly it all came from GEC.


MacLeod:  It did?


Smith:  Yes.


MacLeod:  But why didnít you say that in the beginning. You didnít tell me it came from GEC. Youíre telling me now, this is news to me.


Smith:  Well then, perhaps I didnít make myself clear.


MacLeod:  So when was that money received?


Smith:  It was in, over a, I canít give you an exact date. Within the last year I would say.


MacLeod:  Within the last year. So they would be able to confirm this would they?




Smith:  Well, I think youíd better ask them.


MacLeod:  Yes, I will.


Smith:  I canít confirm that.


MacLeod:  I will.


Beels:  Do they always pay out in £50 notes? Is that the regular part of the system there?


Smith:  I wouldnít say itís a regular part of the system, no.


Beels:  But this money consisted purely of £50 notes?


Smith:  Thatís correct, yes.


Beels:  So, it would be fair to assume that GEC, when they pay your expenses, or whatever, pay in £50 notes?


Smith:  If itís appropriate they do, yes. Depends largely on the size of the payments.


Beels:  Well, what sort of size payments have you received over the last year?


Smith:  I canít give you the exact details, because I ...


Beels:  Approximate amounts?




Smith:  I am sorry, I donít have that information available.


Beels:  What would these payments exactly be for. What Ö?


Smith:  I donít really want to comment any further on this, because I think itís ...


MacLeod:  Well we do, because if only from the point of view of clarification. If you donít mind. What sort of work, or what sort of jobs, or what sort of, how would GEC come to pay you in cash for work carried out by you for them? Give me an example of the kind of work that would entail?


Smith:  Well, it could only entail the work which I normally do, obviously. I mean, I am a Quality Assurance person.


MacLeod:  Yes.


Smith:  The work I do is involved in Quality Assurance work. I do have to do some work outside GEC for, on behalf of the company, auditing external suppliers, very occasionally, and I have recently done a fairly major audit of a company up in Manchester, which is part of the GEC Group.


MacLeod:  And they paid you in cash?


Smith:  They gave me cash, yes.


MacLeod:  Did they? This was in Manchester, GEC in Manchester. When was that?




Smith:  When?


MacLeod:  Yes.


Smith:  That was within the last month.


MacLeod:  Right, Ok. Weíll check that out. And how much did they pay you?


Smith:  It was about £110.


MacLeod:  £110. Unless Iím thick or something, Iím talking about £50 notes. So that money that was found in the drawer, was that part of the money that was paid out by GEC?


Smith:  I didnít say that.


MacLeod:  No, thatís the money. Iím not interested in any other money at this stage, in any other monies that might have come to you. What I am talking about specifically is the £2,000.


Smith:  Well, I explained to you before. I mean, this is money which I have earned, and ...


MacLeod:  Oh, I am sure you have, but not for GEC.


Smith:  I didnít earn the money for GEC. I, the money GEC earns comes from the sale of its services.


MacLeod:  No, an organisation with another three letters, the KGB.




Smith:  It certainly did not come from the KGB. If you feel it came from the KGB, then ...


MacLeod:  Well, what other inference or conclusion ...


Smith:  Ö I think you will have to offer me some evidence that that money was from the KGB, I canít.


MacLeod:  Iím not here to offer you evidence.


Smith:  I canít give you evidence it came from ...


MacLeod:  You are the person thatís here being examined for a breach ...


Smith:  Yes.


MacLeod:  Ö of the Official Secrets Act. You are the one that has got to give us an account for any sort of suspicious monies or payments that might be made to you, because it will be our contention that that was monies paid to you by the KGB, for work that you carried out for them.


Smith:  Well, you can assume that if you wish. All I affirm is, that I received that money for work that I have done.


MacLeod:  If you were sitting where I am sitting, what construction would you put on it?


Smith:  Well, normally, I would not delve into somebody elseís private financial affairs. I would consider that was not




an appropriate thing to do.


MacLeod:  So you think itís inappropriate, or improper, for me to enquire into your financial affairs?


Smith:  In many ways I do. I think these are private matters, between people who might discuss them within their own families.


MacLeod:  But I am telling you, thatís money thatís been paid to you by the KGB.


Smith:  Well, youíre saying that, but I donít feel I have anything to worry about, you having that assumption, because itís not true. I am not, I am completely unfeeling about you saying itís from the KGB, because your statement does not bother me, because I know it did not come from the KGB.


MacLeod:  And yet, you canít give a reasonable account as to how youíve come into the possession of £2,000.


Smith:  As I say, I think youíve gone to the point where you are prying into my private financial affairs, and I for one feel it is a bit private to me, and not for your concern.


MacLeod:  Well, Iím sorry if Iím being inquisitive, but I am going to get to the bottom of this, no matter how long it takes.




Smith:  You can ask as many questions as you like, Iíll answer them to the best of my ability.


MacLeod:  You had that letter from Williams in the same envelope.


Smith:  I think that must be a coincidence. Itís got nothing to do with, if you think thereís some link - as I am sure you were aware, that the serial numbers will be dateable in some way.


MacLeod:  The serial numbers run in sequence.


Smith:  Right. Well, that letter was received many years ago. I canít remember exactly when. There must be a postmark on the letter, and you will, I am sure, see that the connection can only be seen as a very loose one, in that, if they were in the same envelope or not, because they are years apart.


MacLeod:  So, the monies were made up of different amounts then. What you are saying is that was ...


Smith:  I did not say that, no. Iím ...


MacLeod:  Well, Iím telling you the monies were made up of bank notes, serial numbers, albeit they might have been split into three formats, but all ran, all had serial numbers ...


Smith:  I personally counted out the money, to make sure it was in two round thousands, because I felt I was happy to know how much money I had. That was the only reason it was separated. I honestly canít say, you say, the




serial numbers were consecutive, I am not sure if thatís true or not. Iím not sure if itís made up of a number of groups of serial numbers, or not. I donít look at the serial numbers so Ö


MacLeod:  Mmm.


Smith:  Ö if you say they are continuous over the whole amount, then I have to take your word for that.


MacLeod:  What do you know about Karl Gehring?


Smith:  Karl Gehring is a, or was, an employee of GEC Hirst Research Centre until earlier this year.


MacLeod:  And how well did you know him?


Smith:  Very superficially. I had meetings with him on, I think 2 occasions, the last one being well over a year ago, and the one before that maybe 2 years before that, so we are talking about maybe í88.


MacLeod:  So you knew him in 1988. Can you just remind me again what he does, or what he did?


Smith:  He, I canít say exactly everything he did, because I donít know it, but he was for a time at least, responsible for some research activities into materials that could be super-conducting. He was mainly looking at devices, I think, devices which could possibly be used




in a superconducting environment. I donít, honestly, I donít know the full extent of that, because my interviews with him were mainly about the nature of his record keeping, his laboratory techniques, the calibration of his equipment, the methods he might use for software control, the sort of things that a project manager would have to do to run a good project. So, any discussion with him about the technical aspects of the job, I think, would not be very great, so I canít say exactly what he, or the project work he was doing.


MacLeod:  Did you know him well?


Smith:  No, I said superficially. I mean, I knew him by sight, I had had these 2 meetings with him, which couldnít have been more than 3 hours in length, in all. I, he wasnít somebody I saw around very much. I think he used to go out on conferences and ...


MacLeod:  And how well did you, well, correction, when did you last see him?


Smith:  The last time I saw him was, er, I think, last year. You see, he was quite ill for a period. In fact, I think that was one of the reasons why he left the company. He had hepatitis, and I am not sure if he has taken early retirement, or what, but heís disappeared from the company. I think it was early retirement, somebody told me.




MacLeod:  I am going to take a short break now.


Beels:  Ok. I am concluding this interview. Is there anything else you wish to add or clarify Mr Smith?


Smith:  No, I donít think so.


Beels:  At the end of this interview Iíll be asking you to sign the seal on the master tape. Will you do so?


Smith:  Yes.


Beels:  Right. You have a form here explaining your rights of access to the tape. The time is now 8 minutes past 10 in the evening. I am switching the tape off.