THE false report with its lurid headlines, such as "Sex scandal perils peace talks" and "Dangerous Liaison", could not have come at a worse time for former Senator George Mitchell, who was a front-runner for the Secretary of State post in the new administration of President Clinton.

While the report, based on an alleged British intelligence or MI5 investigation, was a scurrilous attempt to smear Mr Mitchell's senior aide, Martha Pope, some believe her boss's political ambitions were the real target.

A shocked Ms Pope herself believed this. The day after the story broke in the Mail on Sunday on December 1st, she told an American newspaper that it was probably intended to hurt Mr Mitchell.

She spoke to Kevin Cullen of the Boston Globe, which was the only US newspaper to report seriously on the unfolding story and to get an unnoticed scoop by its interview with a senior Northern Ireland Office official.

By coincidence, the Deputy Secretary for Security at the NIO, John Steele, was visiting the Globe two days after the story broke. So far the statements on the story from the NIO and Sir Patrick Mayhew had been so cautiously phrased as to anger Irish officials and friends of Ms Pope at the White House, who were convinced, rightly or wrongly, that it was a classic case of British "dirty tricks", which have a long history in Northern Ireland.

Mr Steele's arrival into the Globe office to brief editorial writers on the peace process could not have been better timed for Kevin Cullen, who is probably the US reporter most experienced in Northern Ireland affairs. He asked for the official's comment on the report about Ms Pope's alleged links with Gerry Kelly, who has served a sentence for an IRA bombing and is now a senior member of the Sinn Fein negotiating team.

Mr Steele said: "I read all the intelligence in Northern Ireland. I never saw anything hinting at anything like that. I never saw anything to support even an allegation."

Mr Steele also rejected suggestions by Irish officials that the story had been planted by "rogue elements" in the British government who wanted to smear Mr Mitchell, either to force him to withdraw as chairman of the talks or to ruin his chances of succeeding Warren Christopher as Secretary of State.

"George Mitchell has done great things for Northern Ireland," Mr Steele said. "The British government has not the slightest interest in hurting his chances of becoming Secretary of State. On the contrary, the British government has an interest in him becoming Secretary of State."

This was a most unusual statement to be made by a British official at the very time that President Clinton was pondering over his choice. Diplomatic eyebrows were raised in Washington and London at such a public preference by a British official for one candidate for the most important appointment the President was going to make.

But at this stage, British officials were realising the damage the Mail story - and the alleged role of British intelligence in its publication - was doing in Washington.

Friends of Ms Pope in the White House were furious, first at a report so damaging to her professional reputation and, second, at what was seen as an inadequate response from the British authorities. Ms Pope, while not a celebrity, had a high reputation in political circles on Capitol Hill, where she had been the first woman Sergeant-at-Arms responsible for the security of the Senate, with a staff of 2,000.

Were the British trying to, undermine Mr Mitchell at a sensitive stage in the peace talks when the Irish and US governments were working hard for an IRA ceasefire? Political appointees in the White House friendly with Ms Pope and with strong Irish links seemed to believe this.

But some national security staff preferred to accept British denials and dismiss the affair as "tabloid garbage". The political appointees who accepted the British "dirty tricks" theory were dismissed as "know-nothings".

The Irish Times got an opportunity during the Taoiseach's recent visit to Washington to ask President Clinton for his reaction to the attempt to smear Ms Pope. He replied: "She's a fine woman and a friend of mine. And I understand that the charge has been retracted. And if that's true, that's good. It should have been. We ought to have more false charges retracted in this world, and I'm pleased by that."

This was an official presidential response, but an experienced Washington columnist for the New York Daily News, Lars Erik Nelson, with good White House contacts, wrote that "the Clinton administration has privately questioned the British government on whether Ml5, the British security service, deliberately smeared Martha Pope." It was, a White House official told Nelson, "a friendly dialogue with a friendly nation although I'm not sure it was all that friendly."

Mr Nelson said that while the incident was now officially closed "it leaves a bad taste in, the mouths of top Clinton administration officials. Mitchell is the President's personal envoy for Northern Ireland. MI5 has no business spreading tales about his team.

Both Mr Mitchell and Ms Pope themselves were said to be puzzled at the lack of a more vigorous rebuttal of the Mail from Sir Patrick Mayhew and the NIO. Sir Patrick had told the newspaper: "I know nothing to lead me to doubt the statement by Senator Mitchell that neither he nor any member of his office has any contact with Sinn Fein".

But this was a reference to a Mitchell assurance of several weeks previously when unionist politicians in the Forum had raised questions about reports of contacts between the Mitchell staff and Sinn Fein, but without mentioning any names.

Now that Ms Pope was being specifically mentioned, it was felt that there should have been a more robust defence of her reputation by British officials. The Ulster Unionist leader, David Trimble, who was in Washington when the story broke, said he would like some investigation by Sir Patrick Mayhew of whether there was British intelligence involvement, but "we accept the presumption of innocence" of Martha Pope.

Irish officials were described in some US newspapers as "livid" at what they called British "dirty tricks" and as hinting that this was a way of distracting from the recent British rejection of the proposal by the SDLP and Sinn Fein leaders, John Hume and Gerry Adams, to bring about an IRA ceasefire.

Some US journalists from Mr Mitchell's home state of Maine saw an operation to deprive him of the top post in the new administration. Under the heading "Could a scandal dash Mitchell's Cabinet hopes?", John Day of the Bangor Daily News of Maine wrote that Washington "sources" said that Mr Mitchell's rumoured appointment "has been put in deep jeopardy because of a covert plot by a British intelligence agency to undermine peace negotiations in Northern Ireland."

A foreign policy aide to a former Secretary of State, the late Edmund Muskie, said that "the media flap over Pope could make Mitchell a bit too controversial for a White House already mired in tabloid scandals. That could tilt the President towards United Nations ambassador Madeleine Albright, or National Security Council adviser Anthony Lake."

Something tilted the President. Three days later, Ms Albright won out over her rivals. Mr Mitchell's aides said that he had been told right up to the end that he was still in contention and not to leave Washington.

Republican Congressman Peter King, who closely follows the situation in Northern Ireland as a member of the House Committee on International Affairs, soon afterwards wrote to the outgoing Secretary of State, Warren Christopher, asking him to demand an official British investigation.

"There is reason to believe that MI5 created this scandal in an effort to discredit Pope and thereby Senator Mitchell, and in effect derail the entire peace process.

"At issue," wrote Mr King, "are both the honour and reputation of a dedicated and respected civil servant and indeed the right of the United States to conduct its policies free from the interference of foreign powers.

"If MI5 did undertake a dirty tricks operation in this case, then our closest ally is guilty of an attack on the office of the President of the United States and directly interfering with the policies of the United States.

"If MI5 was involved, the British government owes the American government a direct apology. If there was no MI5 involvement, the British government must say so unequivocally."

By the time the State Department gets around to replying to Mr King, Ms Albright may already be sitting in Mr Christopher's chair. Who is to say that she might not be the unwitting beneficiary of the excesses of a British tabloid egged on by an intelligence agency with a hidden, agenda?