The arrest of Ruroede exposed the New York bureau, and made it necessary for the Germans to shift their base of operations, but it did not put an end to the fraudulent passport conspiracies. Captain Boy-Ed assumed the burden, and hired men to secure passports for him. One of these men was Richard Peter Stegler, a Prussian, 33 years old, who had served in the German Navy and afterward came to this country to start on his life work. Before the war he had applied for his first citizenship papers but his name had not been removed from the German naval reserve list.
"After the war started," Stegler said, "I received orders to return home. I was told that everything was in readiness for me. I was assigned to the naval station at Cuxhaven. My uniform, my cap, my boots and my locker would be all set aside for me, and I was told just where to go and what to do. But I could not get back at that time and I kept on with my work."
He became instead a member of the German secret service in New York. "There is not a ship that leaves the harbor, not a cargo that is loaded or unloaded, but that some member of this secret organization watches and reports every detail," he said. "All this information is transmitted in code to the German Government." In January, 1915, if not earlier, Stegler was sent by the German Consulate to Boy-Ed's office, where he received instructions to get a passport and make arrangements to go to England as a spy. Boy-Ed paid him $178, which the attaché admitted. Stegler immediately got in touch with Gustave Cook and Richard Madden, of Hoboken, and made use of Madden's birth certificate and citizenship in obtaining a passport from the American Government. Stegler paid $100 for the document. Stegler pleaded guilty to the charge and served 60 days in jail; Madden and Cook were convicted of conspiracy in connection with the project, and were sentenced to 10 months' imprisonment.
"I was told to make the voyage to England on the _Lusitania_," continued Stegler. "My instructions were as follows: 'Stop at Liverpool, examine the Mersey River, obtain the names, exact locations and all possible information concerning warships around Liverpool, ascertain the amount of munitions of war being unloaded on the Liverpool docks from the United States, ascertain their ultimate destination, and obtain a detailed list of all the ships in the harbor.'