Arthur Maundy Gregory, the second of three sons of Francis Maundy Gregory (1849–1899), clergyman, and his wife, Elizabeth Ursula Mayow (1847–1936), was born at 9 Portland Terrace, Southampton on 1st July, 1877. After attending Banister Court School he passed the Oxford University entrance examination and went into residence there as a non-collegiate student in 1895.
Gregory originally intended to become a clergyman but left university shortly before his finals and began appearing on the stage. In 1900 he acted in the theatrical company of Ben Greet. In 1902 he took the role of the butler in The Brixton Burglary. He the became manager of the theatre company run by Frank Benson, but was dismissed for fraud in 1906.
According to his biographer, Richard Davenport-Hines: "In 1908 he (Gregory) made his earliest known attempt at blackmail. Harold Davidson, afterwards notorious as the vicar of Stiffkey, who had been his boyhood friend, induced Lord Howard de Walden and other rich men to finance Maundy-Gregory (as he then called himself) in the Combine Attractions Syndicate which crashed in 1909. Gregory next edited a gossip sheet, Mayfair (1910–14). As a sideline he ran a detective agency specializing in credit rating based on information supplied by hoteliers and restaurateurs."
Gregory became friends with Vernon Kell, Director of the Home Section of the Secret Service Bureau with responsibility for investigating espionage, sabotage and subversion in Britain. Kell employed Gregory to compile dossiers of possible foreign spies living in London. Later, Gregory was recruited by Sidney Reilly, the top agent the recently formed MI6. He also did work for Basil Thomson, the head of Special Branch.
According to Brian Marriner: "Gregory, a man of diverse talents, had various other sidelines. One of them was compiling dossiers on the sexual habits of people in high positions, even Cabinet members, especially those who were homosexual. Gregory himself was probably a latent homosexual, and hung around homosexual haunts in the West End, picking up information.... There is a strong suggestion that he may well have used this sort of material for purposes of blackmail."
Basil Thomson later admitted that it was Gregory who told him about the homosexual activities of Sir Roger Casement. "Gregory was the first person... to warn that Casement was particularly vulnerable to blackmail and that if we could obtain possession of his diaries they could prove an invaluable weapon with which to fight his influence as a leader of the Irish rebels and an ally of the Germans."
On 21st April 1916, Casement was arrested in Rathoneen and subsequently arrested on charges of treason, sabotage and espionage. As Noel Rutherford has pointed out: "Casement's diaries were retrieved from his luggage, and they revealed in graphic detail his secret homosexual life. Thomson had the most incriminating pages photographed and gave them to the American ambassador, who circulated them widely. They were a significant, if unmentioned, ingredient in the trial and subsequent execution of Casement." Later, Victor Grayson claimed that Gregory had planting the diaries in Casement's lodgings.
Gregory now moved in circles where he made friends with the rich and famous. This included the Duke of York, who later became King George V. In 1918 he met Frederick Guest and David Lloyd George, the prime minister of the coalition government. It has been argued by Gregory's biographer, Richard Davenport-Hines: "In 1918 Lord Murray of Elibank introduced Gregory to his successor as Liberal chief whip, Frederick Guest, as a potential intermediary between rich men who wanted honours and the Lloyd George coalition which needed money. Guest and his successor, Charles McCurdy, together with Lloyd George's press agent Sir William Sutherland, used Gregory as a tout to build up the Lloyd George political fund by the sale of honours."
The author Brian Marriner has pointed out: "It has been claimed by some that Gregory even suggested the introduction of the new order of the OBE in order to coin more income - even from OBEs he got £20 commission a time.... Gregory had an office in Whitehall at 38 Parliament Street, which had a rear office in Cannon Row (he was always one to leave himself an escape route)." Knighthoods cost about £10,000 and baronetcies £40,000 and it has been estimated that Gregory received commission of about £30,000 a year.
In early 1918 Basil Thomson asked Gregory to spy on Victor Grayson, the former MP for Colne Valley, who was described as a "dangerous communist revolutionary". Gregory was told: "We believe this man may have friends among the Irish rebels. Whatever it is, Grayson always spells trouble. He can't keep out of it... he will either link up with the Sinn Feiners or the Reds." Gregory became friendly with Grayson. David Howell, Grayson's biographer, writes that "Grayson subsequently lived in apparent affluence - a contrast with his recent poverty - in a West End flat. His associates included Maundy Gregory... The significance of this relationship and the source of Grayson's income remain unknown."
During the summer of 1919 Victor Grayson became aware that Gregory was spying on him. He told a friend: "Just as he spied on me, so now I'm spying on him. One day I shall have enough evidence to nail him, but it's not going to be easy." It is not known how he obtained the information but at a public meeting in Liverpool he accused David Lloyd George, the British Prime Minister, of corruption. Grayson claimed that Lloyd George was selling political honours for between £10,000 and £40,000. Grayson declared: "This sale of honours is a national scandal. It can be traced right down to 10 Downing Street, and to a monocled dandy with offices in Whitehall. I know this man, and one day I will name him." The monocled dandy was Gregory.
At the beginning of September 1920, Victor Grayson was beaten up in the Strand. This was probably an attempt to frighten Grayson but he continued to make speeches about the selling of honours and threatening to name the man behind this corrupt system. On the 28th September Grayson was drinking with friends when he received a telephone message. Grayson told his friends that the had to go to Queen's Hotel in Leicester Square and would be back shortly.
Later that night, George Jackson Flemwell was painting a picture of the Thames, when he saw Grayson entering a house on the river bank. Flemwell knew Grayson as he had painted his portrait before the war. Flemwell did not realize the significance of this as the time because Grayson was not reported missing until several months later. An investigation carried out in the 1960s revealed that the house that Grayson entered was owned by Arthur Maundy Gregory. Victor Grayson was never seen alive again. It is believed he was murdered but his body was never found.
Richard Davenport-Hines described Gregory as being "short, paunchy, bald, rubicund, monocled, and epicene." Davenport-Hines added: "He wore ostentatious jewellery, including a green scarab ring he claimed had been Wilde's, and used to fidget with a rose-coloured diamond carried in his waistcoat pocket which supposedly had belonged to Catherine the Great. His manner was grandiose, mysterious, watchful, and confidential."
Arthur Maundy Gregory continued to work closely with Vernon Kell and Basil Thomson in their efforts to stop left-wing politicians from gaining power in Britain. It has been claimed by Brian Marriner that he told prospective buyers of honours that the money would be used by the government to "fight Bolshevism and revolution".
In the 1923 General Election, the Labour Party won 191 seats. Although the Conservatives had 258, Ramsay MacDonald agreed to head a minority government, and therefore became the first member of the party to become Prime Minister. As MacDonald had to rely on the support of the Liberal Party, he was unable to get any socialist legislation passed by the House of Commons. The only significant measure was the Wheatley Housing Act which began a building programme of 500,000 homes for rent to working-class families.
Arthur Maundy Gregory, like other members of establishment, was appalled by the idea of a Prime Minister who was a socialist. As Gill Bennett pointed out in her book, Churchill's Man of Mystery (2009): "It was not just the intelligence community, but more precisely the community of an elite - senior officials in government departments, men in "the City", men in politics, men who controlled the Press - which was narrow, interconnected (sometimes intermarried) and mutually supportive. Many of these men... had been to the same schools and universities, and belonged to the same clubs. Feeling themselves part of a special and closed community, they exchanged confidences secure in the knowledge, as they thought, that they were protected by that community from indiscretion."
In September 1924 MI5 intercepted a letter signed by Grigory Zinoviev, chairman of the Comintern in the Soviet Union, and Arthur McManus, the British representative on the committee. In the letter British communists were urged to promote revolution through acts of sedition. Hugh Sinclair, head of MI6, provided "five very good reasons" why he believed the letter was genuine. However, one of these reasons, that the letter came "direct from an agent in Moscow for a long time in our service, and of proved reliability" was incorrect.
Vernon Kell and Sir Basil Thomson the head of Special Branch, were also convinced that the Zinoviev Letter was genuine. Kell showed the letter to Ramsay MacDonald, the Labour Prime Minister. It was agreed that the letter should be kept secret but someone leaked news of the letter to the Times and the Daily Mail. The letter was published in these newspapers four days before the 1924 General Election and contributed to the defeat of MacDonald and the Labour Party.
In a speech he made on 24th October, Ramsay MacDonald suggested he had been a victim of a political conspiracy: "I am also informed that the Conservative Headquarters had been spreading abroad for some days that... a mine was going to be sprung under our feet, and that the name of Zinoviev was to be associated with mine. Another Guy Fawkes - a new Gunpowder Plot... The letter might have originated anywhere. The staff of the Foreign Office up to the end of the week thought it was authentic... I have not seen the evidence yet. All I say is this, that it is a most suspicious circumstance that a certain newspaper and the headquarters of the Conservative Association seem to have had copies of it at the same time as the Foreign Office, and if that is true how can I avoid the suspicion - I will not say the conclusion - that the whole thing is a political plot?"
After the election it was claimed that Arthur Maundy Gregory and Sidney Reilly, had forged the letter and that Major George Joseph Ball (1885-1961), a MI5 officer, leaked it to the press. In 1927 Ball went to work for the Conservative Central Office where he pioneered the idea of spin-doctoring. Later, Desmond Morton, who worked under Hugh Sinclair, at MI6 claimed that it was Stewart Menzies who sent the Zinoviev letter to the Daily Mail.
In 1927 Gregory acquired the Ambassador Club at 26 Conduit Street in Mayfair. As Richard Davenport-Hines pointed out: "Gregory... with ingratiating flamboyance, he entertained prospective clients, collected gossip, and planted stories. He displayed a gold cigarette case given him by the duke of York, afterwards George VI, at whose wedding he was a steward. In 1929 Gregory bought Burke's Landed Gentry. In 1931 he leased Deepdene Hotel near Dorking, which became a favourite assignation for rich Londoners desiring a dirty weekend." Gregory also "diversified into the less profitable market of foreign decorations, and after being received into the Roman Catholic church in 1932 did brisk business in papal honours."
Stanley Baldwin appointed John C. Davidson as chairman of the Conservative Party organization. Davidson had a major problem raising money for the Conservative Party to fight future elections. One of the problems was Gregory who had for several years been successfully working for David Lloyd George in raising funds for the Liberal Party. As Robert Rhodes James has pointed out: "Davidson's strategy had a brilliant simplicity. He introduced what was in effect a spy into the Gregory organization, whose task it was to obtain the list of Gregory's clients. Davidson then saw to it that no one on that list obtained any honour or award of any kind. Gregory's position depending upon his ability to deliver the goods for which his clients had paid him. By ensuring that none of his clients received any award, Davidson devastatingly undermined Gregory's entire scheme of operations."
In 1932 Gregory was in financial difficulties. He was under pressure to repay to the executors of Sir George Watson (1861-1930) £30,000 advanced for a barony he never received. At the time he was living platonically with a retired musical actress, Mrs Edith Marion Rosse. She had £18,000 in the bank but when Gregory asked her for a loan she refused saying the money was for her "old age".
On 15th September 1932, Roose died and left all her money to Gregory, in a will scrawled on the back of a menu card from the Carlton Hotel. Gregory supervised her burial, specifying a riverside plot in the churchyard at Bisham on the Thames. He ordered the coffin lid to be left unsealed and the grave to be dug unusually shallow - it was only 18 inches from the surface.
Despite inheriting £18,000 from Rosse, Gregory was still in debt to several people he had acquired money from people for honours that they had not received. Gregory now attempted to sell a knighthood to Lieutenant Commander Edward Billyard-Leake. He pretended he was interested and then reported the matter of Scotland Yard. Gregory was arrested on 4th February, 1933, and charged with corruption. He now turned it to his advantage as he was now able to blackmail famous people into paying him money in return for not naming them in court.
The leaders of the Conservative Party were especially worried about Gregory's testimony in court. The chairman of the party, John C. Davidson, approached him, warned that he could not avoid conviction, but undertook that if he kept silent the authorities would be lenient. After a discreet trial he changed his plea to guilty on 21st February, 1933 and received the lightest possible sentence of two months and a fine of £50. According to Richard Davenport-Hines: "On his release from Wormwood Scrubs he was met at the prison gates by a friend of Davidson who took him to France, gave him a down payment, and promised him an annual pension of £2000."
Following a complaint about Gregory by Edith Marion Rosse's niece, who expected to be left money in her will, the police exhumed the body on 28th April 1933. The coffin was waterlogged. Bernard Spilsbury, the forensic scientist used by the police, had little doubt that the burial arrangements Gregory had made were intentional, since "the effect of water on decaying remains would make it impossible to detect the presence of certain poisons."
Arthur Maundy Gregory was arrested by the German authorities in November 1940, Gregory was confined in Drancy Camp, where his health deteriorated without the whisky upon which he depended. He died of cardiac failure, aggravated by a swollen liver, on 28th September 1941, at Val de Grâce Hospital, Paris.
As well as blackmail, Arthur Maundy Gregory kept himself in lucrative work by giving the authorities the sort of reports they wanted about communist subversion. The end of the war saw many strikes and Bolshevik plots were held to be behind them all. The Special Branch and M15 competed to provide evidence to support these claims. In the context of the times, this kind of paranoia is easy to understand. The Russian Revolution of 1917 inflamed the British working classes. There were military riots at Folkestone. Thousands of British troops at Calais mutinied, and two divisions had to be recalled from Germany to surround Calais with machine-guns. Leaflets from secret presses were circulated, urging workers to sabotage the war effort. In London even the police were threatening to strike - and those in Liverpool did, in August 1918. When riots and looting broke out in Birkenhead and Liverpool a battleship and two destroyers steamed up the Mersey, playing searchlights on both banks.
By the end of 1918 Gregory had a solid reputation as a "Mr Fixit" with powerful connections. He had already begun his most lucrative business: selling honours for Lloyd George, so that he could gain funds to fight the next election. Lloyd George's Political Fund was to reach some £3,000,000. It is claimed by some that Gregory even suggested the introduction of the new order of the OBE in order to coin more income - even from OBEs he got £20 commission a time. He usually made a point of hinting to prospective buyers that the money was to be used to enable the government to "fight Bolshevism and revolution".
Gregory had an office in Whitehall at 38 Parliament Street, which had a rear entrance in Cannon Row (he was always one to leave himself an escape route). Like all confidence tricksters, he was assiduous in keeping up a good front: he wore silk shirts, expensive suits and shoes, and much personal jewellery. His office was lavishly furnished, with scrambler telephones on the desk and signed photographs of royalty.
He kept a cab-driver on permanent hire, ready to drive him anywhere at a moment's notice, summoned from Cannon Row by an ingenious system of coloured lights in the office window. Gregory liked to flash a gold, inscribed cigarette-case at visitors, which had been presented to him by the Duke of York, later King George VI, for his work for the King George V Fund for Sailors. His staff were required to refer to him at all times as "The Chief", and his hints at powerful connections, many of which were lies, were always backed up by an obsessive attention to detail. For example, he used to excuse himself to visitors by saying he had an important telephone call from "number 10", but this really referred to 10 Hyde Park Terrace, Bayswater Road, which he leased. Frequent visitors to his office were Sir Basil Thomson of the Special Branch and Sir Vernon Kell of M15.
Early in 1918, Gregory was asked by the Special Branch to keep his eyes open for the return to Britain of a "dangerous communist revolutionary", which was an unlikely description of Victor Grayson at the time. Superintendent Quinn of Scotland Yard instructed him: "We believe this man may have friends among the Irish rebels. Whatever it is, Grayson always spells trouble. He can't keep out of it... he will either link up with the Sinn Feiners [Irish nationalists] or the Reds." Gregory promptly made a point of calling on Grayson's wife, posing as a theatrical producer seeking to cast a new play and asking her if she was interested in a part. Until Ruth Grayson died later in the year, Gregory used her to check on Grayson's movements.
Grayson had no sympathy for the Russian revolutionaries, but he did have links with and sympathies for the IRA. On his return he made several secret trips to Ireland, where he had talks with Michael Collins, who was later one of the leaders of the Irish Free State, founded by the Anglo-Irish Treaty of December 1921, until his assassination in 1922. Grayson soon discovered that Gregory was spying on him, and he became determined to expose him - not only as an honours tout but, what was perhaps even more scandalous, as the possible forger of the infamous Casement diaries. To this end, he made the speech in Liverpool threatening to name Gregory and also began to collect signed statements about his activities as an honours tout. Gregory became extremely alarmed. Grayson was a dangerous enemy who was threatening his source of income. As a journalist, Grayson could easily conduct a campaign to discredit Gregory in a number of publications, always providing he took care not to breach the libel laws.
Having been commissioned to keep an eye on Grayson anyway, Gregory now had a double reason to do so. He made it his business to fabricate reports discrediting Grayson, telling his Special Branch and M15 contacts that Grayson was in touch with both Bolshevik agents and the Sinn Fein movement. But if Gregory was observing Grayson closely, he would have realised that the former MP posed no security threat. Politically, he was finished - and his heavy drinking would have made him an unreliable conspirator in any plots to overthrow the government. Gregory would also have known that there was no Russian connection, only an Irish one. But truth was no impediment to Gregory's urgent need to eliminate the man who was a personal threat to him. If Grayson could not be ruined by fabricated reports, then there were other alternatives. One way or another, Victor Grayson had simply got to disappear.
There is some confusion over the last few weeks of Grayson's public life. It is known that he was the victim of a mysterious attack in London in September 1920. He was beaten up in the Strand, and booked into a hotel with stitches in a head wound and a broken arm in a sling. The police confirm the attack: Grayson was taken to Charing Cross Hospital for treatment. Yet the witnesses who saw him walk out of the Georgian Restaurant and vanish did not notice these wounds. He had visited his mother in Liverpool briefly early that same month, but she too saw no wounds. He told her he could not stay long, as he was due to give a speech in Hull. There is no record of any such speech having been made, nor indeed of any hall in Hull having been booked for the purpose, though Grayson may have gone to Hull in order to see someone. It is almost certain that he took the train from Hull straight back to London, where he must have been attacked.
Then comes the climactic scene in the Georgian Restaurant, when Grayson was told his luggage had been delivered in error to the Queen's Hotel, Leicester Square. This has sinister overtones: Gregory, it will be remembered, had his secret headquarters there, at which he used to interview people in connection with his counter-espionage work. There are variations to the last scene, one of which has a well-dressed woman beckoning Grayson out of the restaurant. But the fact remains that Grayson was not seen again after this evening - or rather, not officially.