Most Americans are aware of the era of lawlessness in this country that began with the passage of the Eighteenth Amendment to the Constitution in 1919, making Prohibition the law of the land. By 1924, five years after the beginning of the “Great Experiment,” defiance of the Prohibition laws had grown to such an extent that Congress appropriated $13,853,980 just to expand the U.S. Coast Guard’s enforcement capabilities.

In 1925 Commander Charles S. Root, the intelligence officer of the Coast Guard, entered into correspondence with Mr. Robert J. Iversen, an employee of the New York Times radio station in New York City. The purpose of the correspondence was to establish a station in New York to intercept the communications of ships engaged in smuggling illegal liquor into the United States, the “rum-runners,”

By our present standards, the equipment used was primitive. Radio New York began operation on 16 October 1925, with two receivers: a low-frequency one designed to collect signals in the 20-200 kHz range and a medium-frequency one to cover 300-750 kHz. The only reference to the location of the station was a note from Iversen that he “investigated D Sunday which appears most desirable as a location.” On 18 October Iversen informed Root that he was borrowing a 200-1000 kHz receiver from the Times so he could put the 600 kHz London-New York commercial circuit on speaker watch. He was also pushing construction of a new long-wave receiver for the same purpose. At the end of October he was still constructing this set with an estimated the cost of the receiver and recorder at $1,000. In the end, the entire installation, including radio equipment, furniture, and all other expenses, came to less than $1,000.

Radio New York’s first rum-runner intercept was apparently accomplished on 4 December, when Iversen intercepted a message from the SS Copeman (formerly the rum-runner SS Avontown) to Cardiff, Wales, announcing its arrival date. Root ordered Iversen to monitor the Copeman constantly because her cipher was readable and analysis could lead to her shore connection.

At one time or another, Iversen had three operators working with him: Roberts, a Canadian working for Radio Corporation (later RCA); Murphy, an alien with first and second citizenship papers who had lived in the U.S. long enough to get his final papers; and Reeves, who quit because his wife did not want to move into the city. The salary was $2,800 for a six-month period. The intercept operators were not told they were working for the United States government.

The operation began to show success. Radio New York began to collect a considerable quantity of rum-runner traffic transmitted by schooners outside U.S. territorial waters. As the London-New York commercial circuit was being monitored, “I’m alone,” a notorious rum-runner was copied on 23 December. Root suggested Iversen to try the intercept stations on the island of St. Pierre et Miquelon, a major source of illegal liquor, for more communications.

At the end of 1925, Root was promoted and transferred, and the personal connection was lost. Later Iversen was ordered to cease sending his traffic to Washington. His new instructions were to deliver it to a cryptanalyst in New York, apparently Victor Weiskopf of the Justice Department, a part-time member of Herbert Yardley’s MI-8 staff, the famous “American Black Chamber,” which continued in operation until 1929.

In 1927, Root established a joint effort using Bureau of Prohibition personnel and Coast Guard equipment to set up intercept stations in California and Florida. In April 1927, Elizebeth S. Friedman was employed by the Bureau of Prohibition as a cryptanalyst and began work in the Coast Guard Intelligence Division. With this, it is presumed that Radio New York went out of business. Mrs. Friedman became nationally famous for her work breaking rum-runner cryptosystems.

Source: NSA