Bloch May Have Had KGB Ties for Long Time

Felix S. Bloch, the high-ranking U.S. diplomat under suspicion of spying for Moscow, may have been in contact with the KGB “over a substantial period of time,” a government source familiar with the case said Saturday.

And a top Austrian official said that Bloch apparently came under suspicion of U.S. authorities in the 1970s.

The American source, who said he could not specify the number of years the alleged contacts went on, said that Bloch was monitored by a foreign intelligence or police agency at meetings with people believed to be Soviet agents. The foreign agency has cooperated with U.S. authorities in the Bloch investigation.

Initial reports of the Bloch case Friday said that the State Department veteran fell under suspicion two years ago while serving as the No. 2 official in the U.S. Embassy in Vienna.

But Austrian Foreign Minister Alois Moch, reportedly a close friend of Bloch, was quoted by the Kurier newspaper in Vienna as saying he had learned recently through Austrian channels “that a certain suspicion on the U.S. side existed back in the 1970s.”

“How Bloch was able to remain for so long in such high positions would be inexplicable if this were so,” Moch was quoted as saying.

Neither the State Department nor the Federal Bureau of Investigation had further comment Saturday on the Bloch case. A day earlier, the State Department said that Bloch had been put on administrative leave while the FBI probed his alleged but unspecified “illegal activities.”

Bloch is not believed to be in custody, but he has not been seen since the case became public. Efforts to reach him for comment have been unsuccessful.

Bloch, a native of Austria, and Moch were friends from the 1950s when both studied in Italy. Some U.S. officials hinted Saturday that Bloch was too inclined to accept Moch’s views on controversial matters such as Austrian President Kurt Waldheim, who is barred from the United States after he was linked to war crimes while serving in the German army during World War II.

Meanwhile, some U.S. officials suggested that the case will not turn out to be as sensational as initial stories promised, although other U.S. officials continued to maintain that it will be “more serious than Hiss.” Alger Hiss, a civil servant working in the State Department, was convicted in 1950 of lying to Congress in a case involving his passing secrets to the Soviets.

A senior Administration official said that Bloch, as second in charge of the U.S. Embassy in Vienna, would have had access to secret code-word information that could compromise intelligence operations. Other officials said that Bloch, as the embassy’s top career officer, could also have read secret diplomatic cables involving U.S.-Soviet negotiations in Vienna.

But George S. Vest, recently retired director general of the U.S. Foreign Service of the State Department, said he was “leery of any allegation of espionage,” particularly since Bloch has not been formally arrested and charged with any crime.

“This is not a foolproof outfit,” he added in reference to the State Department’s Diplomatic Security Service, which reportedly conducted the surveillance of Bloch in Vienna where he allegedly was videotaped as he passed a briefcase to a known Soviet intelligence agent several months ago.

The FBI’s almost public surveillance of Bloch for several weeks in Washington--following him even when he walked his dog--suggested that the agency wanted to scare the diplomat into some compromising move, such as attempting to flee the country, because it has insufficient evidence to arrest him.

Several former senior State Department officials also expressed doubt Saturday about the theory that Bloch, a 30-year veteran of the U.S. Foreign Service, may have spied because he was disgruntled at having been passed over for promotion.

“We’ve a lot of mid-to-senior career officers who don’t make ambassador,” Vest said. “Bloch went to senior seminar (a year of scholarly and practical study outside the State Department), a prestige posting, then to head the office on European economic affairs, which is a very important job” as the Continent moves toward economic unity in 1992, he said.

Another high-level government source also discounted disgruntlement as a potential motivating factor. “I’m not certain the investigation is far enough along” to have identified a reason for Bloch’s alleged activities, he said.

There was also disagreement over why Bloch left Vienna in 1987, after he had served as the deputy chief of mission for three years and in the embassy for more than six years all told.

Ronald Lauder, the former U.S. ambassador to Austria, said Saturday in New York that he had demanded Bloch’s recall to Washington because of “insubordination.” “He went around me” in dealing with the Austrian government, according to the multimillionaire heir to a cosmetic fortune and candidate for mayor of New York City.

Asked if the insubordination dealt with Waldheim, Lauder said Block “was very, very close with people in the Foreign Ministry and the part of the Foreign Ministry that was very, very close to Waldheim. . . . We did not speak about Waldheim.”

But Vest, who had a major voice in assignment of U.S. diplomats then, said he was “unaware” of Lauder’s request that Bloch be reassigned.

“Bloch was not pulled out prematurely. He was due to have come out when he did. He had been in the job as DCM (deputy chief of mission) at the embassy for more than three years. Lauder, as the new ambassador, said he wanted his own DCM,” Vest explained. “We gave him his choice of a new man.”

A senior Administration official said that working for Lauder and, before that, for Helene A. von Damm--both of them political appointees as ambassadors--was very difficult for career diplomats.

Both Moch and Bloch appeared to be sympathetic to Waldheim in his efforts to avoid being tied to war crimes. The speculation about Bloch becomes especially intriguing because of widespread rumors that while Waldheim was secretary general of the United Nations, the Austrian diplomat was being “squeezed” by the Soviets. The Kremlin, according to one theory, knew that Waldheim was hiding his background and remained silent as long as he provided them with information.

Moch, the foreign minister, was reportedly the principal supporter of Waldheim in the Austrian government when the United States decided to cite Waldheim for his wartime activities in the German army.

And Bloch was “very unhappy about our decision to put Waldheim on the ‘Watch List’ (of suspected war criminals),” according to a U.S. official who visited Vienna at the time.

Moch said he was “deeply shocked and personally affected” by the news reports about Bloch, but he then described his friend as an “overambitious career diplomat who had suffered under politically appointed ambassadors and never himself became ambassador.”

And, he mused, “in a long political career, some people cannot resist the temptation” to spy.

Times staff writers Robin Wright and Oswald Johnston, in Washington, and John Goldman, in New York, contributed to this story.