Career

Gustav Steinhauer was born in Berlin circa. 1870. He was an officer of the Imperial German Navy who in 1901 became head of the British section of the German Admiralty's intelligence service, the Nachricten-Abteilung, 'N'. He had trained at the Pinkerton Detective Agency in Chicago and spoke fluent English with an American accent.

Steinhauer had been part of Kaiser Wilhelm II's bodyguard at the funeral of Queen Victoria in 1901. During the visit Steinhauer foiled an assassination attempt by a group of Russian anarchists on the Kaiser's life, working alongside British detective and spymaster William Melville

William Melville

William Melville was an Irish law enforcement officer and the first chief of the British Secret Service, forerunner of MI5.-Birth:...

.

Steinhauer was responsible for the creation of a network of German spies in Britain in the period before the war. Steinhauer had mostly recruited his agents through writing to German businessmen resident in the UK inviting them to work for him. Mi5

MI5

The Security Service, commonly known as MI5 , is the United Kingdom's internal counter-intelligence and security agency and is part of its core intelligence machinery alongside the Secret Intelligence Service focused on foreign threats, Government Communications Headquarters and the Defence...

 soon clocked onto this activity and began intercepting the correspondence between Steinhauer and his agents, between 1911 and 1914 Mi5 intercepted 1189 letters relating to such German espionage.

In late July, the week before the declaration of the First World War, Steinhauer toured Britain under the alias 'Fritsches' to make contact with elements of his agent network, although Mi5 knew he was present in the country they did not have the resources to mount sufficient surveillance to apprehend him. On the day war finally was declared Vernon Kell, head of Mi5, ordered the arrest of 22 of Steinhauer's agent ring, leaving no significant German spies in Great Britain.
Steinhauer later recalled the Kaiser's fury at the complete oblieration of German surveillance of the British Navy screaming 'Am I surrounded by dolts? Who is Responsible? Why was I not told!?'

Trivia

Historian Andrew Cook has suggested that Steinhauer's plot to blow up the Bank of England

Bank of England

The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694, it is the second oldest central bank in the world...

 could have been Ian Fleming

Ian Fleming

Ian Lancaster Fleming was a British author, journalist and Naval Intelligence Officer.Fleming is best known for creating the fictional British spy James Bond and for a series of twelve novels and nine short stories about the character, one of the biggest-selling series of fictional books of...

's inspiration for the character and plot of Auric Goldfinger

Auric Goldfinger

Auric Goldfinger is a fictional character and the main antagonist in the James Bond film and novel Goldfinger. His first name, Auric, is an adjective meaning of gold...

.

Footnotes