A German Spy in Kilburn and the Three Barbers

Gustav Steinhauer was the German spymaster before and during the First World War. He had worked for the Pinkerton Detective Agency in Chicago and had been the Kaiser’s bodyguard when he visited London in 1901 for Queen Victoria’s funeral. In disguise, Steinhauer travelled to England several times to set up a spy network before the War. 

Gustav Steinhauer in Naval Uniform

He recruited three German hairdressers, Karl Gustav Ernst, Wilhelm Kronauer and Otto Kruger, who acted as intermediaries to receive and forward letters from his agents. Ernst had a shop at 402a Caledonian Road, Kronauer was at 31 Fortune Green Road (near today’s famous Nautilus fish restaurant in West Hampstead), and Kruger was at 334 Kilburn High Road.

During the Kaiser’s visit to England in May 1910 to attend the funeral of King Edward VII, Special Branch followed a senior German officer to Ernst’s shop where he stayed overnight. This was suspicious, so a Home Office Warrant (HOW) was issued, and the GPO intercepted all letters to and from the Caledonian Road address. It proved to be a major coup for British Intelligence as Steinhauer did not know this and used Ernst as his main post box. In 1911 several letters from a Kilburn postmark were intercepted. On the 13 November 1914 Ernst was sentenced at the Old Bailey to seven years imprisonment in Portland prison.

In February 1912 Wilhelm Kronauer was named during the trial of the German spy Heinrich Grosse. Kronauer had lived in the City for 11 years and had been in West Hampstead for three years. He had previously worked as a hairdresser for Kruger. After the publicity of the spy trial, Kronauer lost customers and the business suffered. He began to drink heavily and argue with his wife Marie, who attempted suicide. They moved to Wandsworth and changed their name. To assist them Steinhauer first sent £10 and then another £20. But it all proved too much, and Kronauer drowned himself in the Thames on 25 January 1913. 

Marie moved to 43 Achilles Road in West Hampstead and continued to work for Steinhauer. She later moved to Cumberland Street in Islington where she was arrested in June 1914. She was interned until August 1919 and deported to Germany.

Otto Walter Moritz Kruger was born in Germany in 1880 and came to England in November 1898. In 1905 he married Violet Phillips from Wales and established a barber shop at 334 Kilburn High Road (near Iverson Road). 

On 2 February 1911 Kruger employed his nephew Frederick Ireland from Bristol, as an assistant hairdresser at the Kilburn shop. Later, he persuaded Fred to join the Royal Navy as a stoker in July 1911, much to his parents’ dislike. 

While on HMS Foxhound a torpedo destroyer, Ireland agreed to work for Steinhauer in January 1912, and he received a monthly salary of £6 (worth about £550 today), for his reports on ship movements. His letters were intercepted, and although not signed he was identified from an analysis of his handwriting. 

On 21 February 1912 Fred was arrested in Christiania (renamed as Oslo in 1925) Norway. His parents and an uncle told police Fred had said that Kruger could get him money from Germany for information about the Navy. The Government decided not to go to trial, as sensitive material would have to be produced in court. Ireland was dismissed from the Navy, and returned to live with his parents in Bristol where he worked as an assistant hairdresser. 

Four days after Ireland’s arrest, Kruger fled to Germany, but Steinhauer persuaded him to return to Britain in April 1913 by again agreeing to pay for his intelligence work. MI5 lost track of him, and then discovered that he and his family had moved to the coal mining area of Abercynon in South Wales. He became friendly with the local miners, but the police reported that he was strongly pro-German and talked openly about the forthcoming European war. He attempted to recruit his brother-in-law Frederick Fowler, a hairdresser in Penarth Wales. Fowler was arrested in the August 1914 roundup but then released without charge.

Both Ireland and Kruger were also arrested on 5 August 1914 as part of the highly publicised arrest of the 21 German agents. Because he was an English national, Ireland was released, but Kruger was held as an enemy alien on the Isle of Man. In December 1916 Kruger applied for deportation as a POW aged over 45. This was granted and he was sent to Germany. 

His wife Violet was not implicated in his espionage work. She brought up their three children and in the 1930s she was living in Hammersmith. Kruger went to America in 1926 and seems to have died there in 1936. 

Today, No.334 Kilburn High Road is an Italian restaurant called Ciao Ciao.