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Docuraphy of Le Chiffre is attached at Appendix A Also, Appendix B, a note on SMERSH

We have been feeling for so into deep water In nearly all respects he is an adross physical habits and predilections are an Achilles heel of which we have been able to take advantage from time to time and one of his mistresses is a Eurasian (No 1860) controlled by Station F, who has recently been able to obtain insight into his private affairs

Briefly, it seems that Le Chiffre is on the brink of a financial crisis Certain straws in the ere noticed by 1860 - some discreet sales of jewellery, the disposal of a villa at Antibes, and a general tendency to check the loose spending which has always been a feature of his way of life Further inquiries were made with the help of our friends of the DeuxiŠ jointly on this case) and a curious story has coht control of a chain of brothels, known as the Cordon Jaune, operating in Norh to employ for this purpose some fifty rad Section III for the financing of SODA, the trade union mentioned above

Normally the Cordon Jaune would have proved a most excellent investment and it is possible that Le Chiffre was motivated more by a desire to increase his union funds than by the hope of lining his own pocket by speculating with his employers' money However that may be, it is clear that he could have found many investments more savoury than prostitution, if he had not been tempted by the byproduct of unlimited women for his personal use

Fate rebuked hi swiftness

Barely three months later, on 13 April, there was passed in France Law No 46685 entitled Loi Tendant … la Fermeture des Maisons de Tol,rance et au Renforcement de la Lutte contre le Prox,nitisrunted and pressed a switch on the intercom

'Head of S?'

'Sir'

'What the hell does this word , sir'

'This is not the Berlitz School of Languages, Head of S If you want to show off your knowledge of foreign jawbreakers, be good enough to provide a crib Better still, write in English'

'Sorry, sir'

M released the switch and turned back to the memorandum)

This law [he read] known popularly as 'La Loi Marthe Richard', closing all houses of ill-faraphic books and filht and suddenly Le Chiffre was faced with a serious deficit in his union funds In desperation he turned his open houses into ed on the border-line of the law, and he continued to operate one or two cin,round, but these shifts in no way served to cover his overheads, and all attempts to sell his investment, even at a heavy loss, failed dismally Meanwhile the Police des Mours were on his trail and in a short while twenty or more of his establishments were closed down

The police were, of course, only interested in this -time brothel-keeper and it was not until we expressed an interest in his finances that the DeuxiŠ with their colleagues of the police departnificance of the situation became apparent to us and to our French friends and, in the past few months, a veritable rat-hunt has been operated by the police after the establish reinal investment and any routine inquiry would reveal a deficit of around fifty million francs in the trade union funds of which he is the treasurer and paymaster

It does not seerad have been aroused yet but, unfortunately for Le Chiffre, it is possible that at any rate SMERSH is on the scent Last week a high-grade source of Station P reported that a senior official of this efficient organ of Soviet vengeance had left Warsaw for Strasbourg via the Eastern sector of Berlin There is no confirmation of this report from the DeuxiŠ (who are reliable and thorough) and there is also no news from Le Chiffre's headquarters there, which we have well covered by a double agent (in addition to 1860)

If Le Chiffre knew that SMERSH was on his tail or that they had the smallest suspicion of him, he would have no alternative but to coest that while he is certainly desperate, he does not yet realize that his life may be at stake It is these rather spectacular plans of his that have suggested to us a counter-operation which, though risky and unconventional we submit at the end of this memorandum with confidence

In brief, Le Chiffre plans, we believe, to follow the exaood the deficit in his accounts by ga The 'Bourse' is too slow So are the various illicit traffics in drugs, or rare medicines' such as aureo- and streptomycin and cortisone No race-tracks could carry the sort of stakes he will have to play and, if he wins, he would more likely be killed than paid off

In any case, we know that he has withdrawn the final twenty-five million francs from the treasury of his union and that he has taken a shbourhood of Royale-les-Eaux, just north of Dieppe, for a week froht tomorrow

Now, it is expected that the Casino at Royale will see the highest ga money from Deauville and Le Touquet, the Soci,t, des Bains de Mers de Royale have leased the baccarat and the two top cheroup of ,yptian bankers and business-men with, it is said, a call on certain royal funds, who have for years been trying to cut in on the profits of Zographos and his Greek associates resulting frohest French baccarat banks

With the help of discreet publicity, a considerable nuest operators in Aed to book at Royale this su-place will regain some of its Victorian renown

Be that as it may, it is here that Le Chiffre will, we are confident, endeavour on or after 15 June tocapital of twenty-five million (And, incidentally, save his life)

Proposed Counter-operation

It would be greatly in the interests of this country and of the other nations of the North Atlantic Treaty Organization that this powerful Soviet agent should be ridiculed and destroyed, that his Coht into disrepute, and that this potential fifth coluth of 50,000, capable in ti a wide sector of France's northern frontier, should lose faith and cohesion All this would result if Le Chiffre could be defeated at the tables (NB Assassination is pointless Leningrad would quickly cover up his defalcations and make him into a aiven the necessary funds and endeavour to out-gamble this man

The risks are obvious and the possible loss to the Secret funds is high, but other operations on which large sums have been hazarded have had fewer chances of success, often for a smaller objective