Australian Dictionary of Biography

  • Tip: searches only the name field
  • Tip: Use double quotes to search for a phrase

Cultural Advice

Aboriginal and Torres Strait Islander people should be aware that this website contains names, images, and voices of deceased persons.

In addition, some articles contain terms or views that were acceptable within mainstream Australian culture in the period in which they were written, but may no longer be considered appropriate.

These articles do not necessarily reflect the views of The Australian National University.

Older articles are being reviewed with a view to bringing them into line with contemporary values but the original text will remain available for historical context.

Clayton, Walter Seddon (Wally) (1906–1997)

by Phillip Deery

This article was published online in 2021

Walter Seddon Clayton (1906–1997), communist, and Soviet spymaster, was born on 24 March 1906 at Ashburton, New Zealand, second of three children of Yorkshire-born Thomas Ernest Clayton, ironmonger, and his New Zealand-born wife Alice Maude, née Bean. Wally was educated at Christchurch at Opawa School and Christ’s College until the age of sixteen, when he began work in local sports stores. In 1930 he fell in love with a visiting opera singer, Hilda Mary Lane, the Paraguayan-born niece of the Australian socialist William Lane, and followed her to Melbourne in 1931, where he worked selling bags and travel goods. They were married at the Prahran registry office on 24 June that year. Galvanised by the effects of the Depression, Clayton joined the Communist Party of Australia (CPA) in 1933, and later became a full-time party functionary, well known for his soapbox speeches and organising abilities. He also assisted the communist-led New Theatre movement. By 1936 he was a member of the Victorian State committee and a district organiser in Melbourne’s northern suburbs.

In April 1939 Clayton moved to Sydney, where he became a CPA campaign director and sales manager for the party’s newspapers. He withdrew from public political activity following the Menzies government’s outlawing of the CPA in June 1940, and assumed responsibility for the party’s underground apparatus. For over two years, until the CPA’s legality was restored in December 1942, he organised clandestine activities that included recruiting members, managing training schools, and running informants, all of which provided the basis for his ‘tradecraft' skills when he later started working in espionage. By 1944 he was a member of the CPA’s central committee and in charge of its central control commission, responsible for internal security and moral orthodoxy. In late 1944 he left his wife to live with Shirley Hallett until her death in February 1946; he and Hilda were divorced in April 1947.

Between 1943 and 1950, Clayton was agent master of Australia’s largest spy network. In 1943 he had been recruited by Semyon Makarov, the first NKGB (People’s Commissariat of State Security) rezident in Australia. Clayton provided him with highly classified intelligence material through Feodor Nosov, the Australian representative of the Soviet Union’s news agency, TASS. Transmitted to Moscow as encrypted cables, the material was intercepted and deciphered by the United States of America in the ultra-secret Venona program. In April 1945 Clayton’s Soviet handlers assigned him the codename ‘Klod.’ He ran at least ten agents, some willing, others unwitting. Several were located in the Department of External Affairs; one, Ian Milner, leaked to him top-secret papers prepared in 1945 by British military planners. Responding to increased surveillance, the MGB (Ministry of State Security), successor to the NKGB and a predecessor of the KGB (Committee for State Security), prudently ordered a temporary suspension of Clayton’s contact with Makarov in October 1946. Early in 1948 he was reactivated, and continued to provide less valuable intelligence until Easter 1950. By then, the MGB had learnt that its cables were being decrypted, and the Klod network was shut down. He switched to using his finely honed tradecraft to again prepare the CPA for being outlawed.

Late in 1951, after the CPA survived the Menzies government’s attempts to proscribe it, Clayton disappeared to a remote farm on the south coast of New South Wales, defeating police and Australian Security Intelligence Organization (ASIO) attempts to locate him. He was subpoenaed on 13 July 1954 to appear before the royal commission on espionage—Menzies’s response to the defection of Vladimir and Evdokia Petrov—but refused to do so until 15 March 1955, ostensibly to clear his name. During four days in the witness box, he denied all allegations against him. The royal commissioners knew from the Venona cables and ASIO briefings that he was Klod, and found that he had resorted to ‘evasions, equivocations, refusals to answer questions, and lies’ (Australia 1955, 150).

After the royal commission, the CPA leadership distanced itself from Clayton, but his loyalty to communism remained steadfast. He married Peace Joy Gowland, the Broken Hill-born daughter of a boilermaker and herself a committed communist, on 1 March 1956 at the Sydney registry office. It was assumed by ASIO, wrongly, that he might be reactivated by the KGB, and throughout 1957 it placed him under intense physical surveillance and psychological pressure. In April the Claytons planned to defect to the Soviet Union, but their passports were cancelled by the Menzies government at the last minute. During this period ASIO described him as an ‘unassuming, quietly spoken, highly strung, intelligent individual’ (NAA A6119, 957), but Frances Bernie, a member of the Klod group, had found him ‘as cold as a fish’ (NAA A6119, 798), and the party defector Cecil Sharpley recalled him as ‘completely ruthless and impersonable’ (Ball and Horner 1998, 226). ASIO photographs reveal a tall, thin, balding and anxious-looking man.

Surveillance of Clayton continued into the 1970s, long after he and his wife had moved to Salt Ash near Port Stephens, where he became a professional fisherman known as the ‘Snapper King.’ He stubbornly maintained his innocence of espionage until 1993 when Laurie Aarons, the party member who had dismantled Clayton’s illegal apparatus after 1957, surreptitiously recorded his confession. In 1996, after being shown Venona decrypts, Clayton acknowledged that he was Klod and remarked ‘It was an awful name they gave me, wasn't it?’ (Ball 2011, 5). On 22 October 1997 he died at Waratah, New South Wales, and was cremated. He was childless, but, as ASIO noted of him in 1958, communism had ‘taken the place of children’ (NAA A6119, 1597).

Research edited by Stephen Wilks

Select Bibliography

  • Aarons, Mark. The Family File. Melbourne: Black Inc., 2010
  • Australia. Royal Commission. Report of the Royal Commission on Espionage. Sydney: Government Printer, 1955
  • Ball, Des. ‘The Spy Who Came Out as Klod.’ Australian, 24 December 2011, 5
  • Ball, Desmond, and David Horner. Breaking the Codes: Australia’s KGB Network, 1944–1950. Sydney: Allen & Unwin, 1998
  • Fitzgerald, Ross. ‘Peace, for the Party and “Betterment of the Whole World.”’ Australian, 24 December 2011, 5
  • Horner, David. The Spy Catchers: The Official History of ASIO, 1949–1963. Sydney: Allen & Unwin, 2014
  • McKnight, David. Australia’s Spies and Their Secrets. Sydney: Allen & Unwin, 1994
  • McKnight, David. Espionage and the Roots of the Cold War: The Conspiratorial Heritage. London: Frank Cass, 2002
  • National Archives of Australia. A6119, 798. Frances Ada GLUCK (aka GARRETT, aka BERNIE) nee SCOTT, vol. 5
  • National Archives of Australia. A6119, 957. CLAYTON, Walter Seddon, vol. 5 (TS)
  • National Archives of Australia. A6119, 1597. CLAYTON, Walter Seddon, vol. 9
  • United States. Fifth VENONA Release. Vol. 3. Fort George G. Meade, Maryland: National Security Agency, October 1996

Additional Resources

Related Entries in NCB Sites

Citation details

Phillip Deery, 'Clayton, Walter Seddon (Wally) (1906–1997)', Australian Dictionary of Biography, National Centre of Biography, Australian National University, https://adb.anu.edu.au/biography/clayton-walter-seddon-wally-31299/text38682, published online 2021, accessed online 21 May 2022.

© Copyright Australian Dictionary of Biography, 2006-2022