FAUX History of the Outer Banks: The Phantom Torpedo of Pamlico Sound

Steven C. Levi
12 min readFeb 29, 2020


The Phantom Torpedo of Pamlico Sound

“Like the South it shall rise again!”

. . . Pamlico Sound Prediction

Not every interesting tidbit of the history of Pamlico Sound occurred back in the days our grandfathers. Events have a tendency to happen at any time and history is not the story of what did happen but it is the ongoing saga of what is going to happen based on past events.

One of the more unusual tales to come out of Pamlico Sound is what has become known as the “Phantom Torpedo.” Phantom is a term that came into vogue immediately after the Second World War and thus it was natural to associate anything that was unexplainable with the adjective “phantom.” Thus is the origin of the phantom torpedo. However, in all fairness, the tale of the phantom torpedo is more one of mechanical failure than some unseen hand of fate. But it is nonetheless an interesting story.

The actual story of the phantom torpedo begins before America’s entry into the last war. Even though the United States had not declared war against Germany, we were committed to warfare against the Axis. There just had not been a Declaration of War. The Germans felt the same way and expressed their displeasure by using their U-boats to sink every American ship that came within range of their torpedoes. What Americans did not know then and do not know now is that quite a few of those American ships were sunk within eyesight of the United States coastline. The primary reason was not one of propaganda but functionality. Ships that lay between the German submarine and the American coastline were silhouetted perfectly against any light on shore. Thus the submarines preferred to hunt at night.

From the German point of view, the Outer Banks was a prime hunting location. More than 100 ships went to the bottom around the village of Hatteras, so many that the waters between Hatteras and Ocracoke islands were known as Torpedo Junction. In the early years of the war the Germans, having read their American history, knew that the waters of Pamlico and Albemarle sounds provided maritime access to a substantial portion of the Eastern seaboard. Pirates, privateers, smugglers and other such nefarious entrepreneurs had used the waters to their advantage for centuries. Confederate blockade runners had used the shallow waters to their advantage and kept the South supplied with salt, medicine, food, boots and the implements of war.

Pamlico Sound was of particular interest to these ships because of its shallow waters. Large war ships could blockade the main entrances at Oregon Inlet, Hatteras, Ocracoke and Cape Lookout, but could not enter the Sound because of their draft. Once into Pamlico Sound the smaller ships would be certain that the larger ships would not follow. Often the smaller boats never even encountered the blockades. There were enough narrow channels through the isthmus that bootleggers, for instance, could run from Rum Alley as far as Richmond and never see a revenue cutter.

While the American public was not aware of the German threat, shipping companies were. Maritime traffic all along the East Coast was cautious. It worked closely with the United States Coast Guard to minimize all light ashore, ran blacked out, traveled in convoys when such were available and took the slogan “Loose Lips Sink Ships” very seriously.

Few of these precautions were taken within Pamlico Sound. It was believed that the water was so shallow that any submarine venturing inside would soon run aground. Even if the U-Boat did not run aground, it would be so difficult for the submarine to maneuver that it would be an easy target for the mosquito fleet of North Carolinians who were constantly on patrol in small, high speed boats. Most of these smaller boats had Letters of Marque. Those without were interested in capturing in capturing a war prize for which the United States government would pay a king’s ransom.

At some future time I am certain that the United States military will open its archives to researchers. At this time the history of World War II is that which is recalled by Outer Bankers. In their collective memory there was only one incursion by a U-Boat into Pamlico Sound. It was a quick foray and resulted in no kills.

But it did generate the legend of the phantom torpedo.

Sometime in the Spring of 1942, within a few months of the declaration of war, the shipping firm of Dunlap, Exeter and Fitzhume out of Sandersonville purchased a motley fleet of ships and boats to be used for intracoastal delivery of goods within Pamlico, Currituck and Albemarle sounds and the myriad river sheds that fed the accumulated sounds. The money behind the firm was Joseph Allen Dunlap, an elderly gentleman who had retired from Sandersville University where he had spent 30 years as a classics scholar.

His previous occupation is of interesting significance only inasmuch as he renamed his ships for his personal academic heroes. Renaming a ship is considered a hoodoo in maritime circles but this did not bother Dunlap. The logic of renaming ships in furtherance of the war effort was also hard to determine. Submarines choose targets based on the size, location and proximity of the vessel rather than its name. But Dunlop was a strong believer in the Golden Rule, “He who has the gold makes the rule.”

Of no importance whatsoever to this historical saga but interesting still, Dunlap named his ships legally on paper as the HESTER PRYNNE, EDGAR ALLEN POE, AMBROSE BIERCE and JEAN CHAMPOLLION. (It was rumored that he had purposefully misspelled Edgar Allan Poe’s middle name in tribute to his own middle name.) When it came to identifying the ships with names actually painted on the vessel, he had an oversized “A” in blood red painted on the bow of the HESTER PRYNNE in obvious reference to Nathaniel Hawthorne’s heroine in THE SCARLET LETTER. The EDGAR ALLEN POE had a raven on its bow which locals referred to as a seagull which had been dipped in some black substance that cannot be mentioned here. The AMBROSE BIERCE had an owl on the stern only and the JEAN CHAMPOLLION had the cartouche of Tutankhamen which many doubted as authentic as it had been painted on the ship in Norfolk while the wheelchair-confined Dunlap was at a medical clinic in Vermont. Jean Champollion, the person not the vessel, was the French scholar who had broken the code of the Rosetta Stone and allowed modern scholars to read hieroglyphics.

Of the flotilla, one was unusual. The HESTER PRYNNE had been purchased through Dunlap’s connection with the scientific community. The ship had originally been designed for Antarctic exploration. The Shackleton Expedition, 1914–1916, had taught ship builders that special hulls had to be constructed if the vessel was going to be in ice-chocked waters for any period of time. Shackleton’s ship, the ENDURANCE, did not endure the freeze-up in Antarctic waters long. Because the ship had been built for open water travel, it has a hull that was made for speed. This was a scenario made for disaster. Once the ENDURANCE became trapped in the freezing waters it was at the mercy of the ice. As the ice thickened, the ship was crushed to splinters.

To avoid repeating the fate of the ENDURANCE, explorers to ice-chocked waters wanted ships that would pop out onto the ice pack as the waters froze. Thus was developed a new design of hull that was rounded rather than steep. It was not as fast in ice-free ocean waters but it could survive if it were caught in the grip of the ice. The ships were expensive to build and beyond exploration there was little call for slow ships with fattened hulls.

Dunlap, though a man with a background in the classics rather than cargo, was not a dolt when it came to making money. He was aware of the unique construction of the exploration ships and saw an opportunity others did not. Though the ships were slow, their unique hull design allowed them more cargo space. Since he was primarily interested in Pamlico, Currituck and Albemarle business, speed was not of the essence but draft was. The exploration vessels could carry large loads in shallower water and could thus save him on lighterage charges. Through his connections at the Sandersonville University he was able to purchase an Arctic vessel on its way to the salvage yard. The cost was a dollar. The vessel was renamed the HESTER PRYNNE, possibly because the bowed hull gave the ship a somewhat pregnant appearance.

The bulbous construction of the hull was what saved the ship. In the Spring of 1942, the four ships owned by Dunlap, Exeter and Fitzhume were in Buxton on the Atlantic side and had just been loaded with goods for the North Carolina mainland when a submarine on the surface was reported in the vicinity at Oregon Inlet. There was no concern among the crew members of any ship as Oregon Inlet was a good ways north of their location and the fleet was headed in the other direction. Even though it was reported that the U-boat was headed south, even at top speed it could not reach Buxton on the Atlantic seaboard in time to catch up to the flotilla. Once around the tip of the isthmus at Hatteras the ships would be into shallow water and it was very unlikely that the submarine would give chase in waters that could be as shallow as 12 feet deep 20 miles from shore.

They should have been more concerned. Unknown them until after the Second World, this particular submarine was on a unique mission. It had been ordered to test the depths of the very waters into which the fleet was sailing. The German naval command had long wondered if it were possible to enter the shallow sound areas and sink ships. If enough ships could be sunk in the shallow waters, it would clog the shipping lanes. So a small submarine was designed and given the task of penetrating Pamlico Sound. The U-boat entered at Oregon Inlet where it was spotted, not unlikely as the waters there were so shallow.

This concept, it should be pointed out, was not as far-fetched as it would be considered today. No less a military strategist that the turncoat Benedict Arnold saw the importance of invading Pamlico and Albemarle sounds. In a letter to Sir Henry Clinton in February of 1781, Arnold stated that he intended to “send some Boats with four or five hundred Troops thro’ Curratucks Inlet, to Sweep the Albemarle Sound as high as Edington, & to go to New Bern and destroy their Shipping, Stores, &c.” A century and a half later, the same logic held.

What the mariners at Buxton failed to appreciate was that the U-boat was headed south but not along the Atlantic coastline. It was headed south inside Pamlico Sound. Once the flotilla rounded the southern tip of Hatteras Island and headed north into Pamlico Sound, with each passing mile they and the U-Boat were drawing closer.

Of even greater danger to the flotilla, the U-Boat was using the same nautical charts that the captains were using. The charts had been created by the United States Coast Guard and were the best on the market before the war when they had been purchased by both the flotilla captains and the Germans. Charting a route that kept them in the deepest waters the captains were doing the same thing headed north that he U-boat captain was doing headed south. There were destined to meet, which they did, about four nautical miles west of Gull Island.

It is most likely that the U-boat spotted the flotilla first. The submarine was traveling on the surface to give itself more speed along with a few more feet of clearance. The flotilla didn’t expect to see a submarine so they weren’t on the lookout. Even if the captains had spotted the U-boat first, they probably would have assumed it was just another surface ship. The first the captains knew of the submarine was when it, quite literally, appeared dead ahead. Only then did the ships go to alert.

What happened next was a case study in chaos. Everyone on every ship started running around the deck trying to figure out what they were supposed to do when a submarine was spotted. No one had been trained what to do because the ships on which they served were intracoastal and were thus immune from submarine attack. They were in error, so much so there were no weapons of war on board, just a few shotguns and some boarding pikes. Even if the crew had known what to do they would not have had the weapons to do it. Pandemonium reigned.

There were only two people in the accumulated crew who had the presence of mind to perform useful tasks. One was the radio operator on the JEAN CHAMPOLLION, Fern Russel. She radioed the Coast Guard and gave the flotilla’s position. She also gave a description of submarine, no mean task as she was forced to use binoculars in one hand while tapping out her message with the other. As it turned out the flotilla was saved because the submarine picked up the radio message. The surprise attack had been successful but the possibility of a naval or Coast Guard interception would have been deadly for the submarine.

There was only time for one torpedo. At several hundred yards, the submarine fired.

The second person who saved the day was the captain of the HESTER PRYNNE. The captain had no days of training in what to do so he did what he saw ship captains in similar situations do in war movies: he swung the bow of the ship toward the submarine. The logic of this move was undeniable. The smaller the target, the less chance of being hit and the bow of the ship was substantially smaller than the broadside of the hull.

It was a fortunate choice by the captain. Because of the unique construction of the HESTER PRYNNE it appeared to be the largest ship. The single torpedo that was launched was thus targeted for the HESTER PRYNNE. But the turn came too late.

At this moment three unexpected factors came into play all at once. First, what the submarine captain had failed to do was compensate for the unique hull design of the HESTER PRYNNE. There was no way that the submarine captain could have known that the ship had a bowed hull because there was nothing visible above the water line to so indicate. Second, the HESTER PRYNNE was swinging head-on toward the submarine. This not only changed the angle of the shot but with every passing second, the target was becoming smaller. Third, torpedoes at that stage of the war were not as electronically sophisticated as they would be two years later.

The torpedo hit the HESTER PRYNNE about six feet back from the bow. Under normal circumstances it would have been a kill even though it was a glancing blow. But the HESTER PRYNNE was not a normal ship. Thus the torpedo did not hit a flat surface. It hit a bulbous surface and the force of the metal fish was deflected. One moment the HESTER PRYNNE was about to go to Davy Jones’ Locker and the next instant the fish was speeding away at an oblique angle.

At this time there is no documentary evidence to indicate the fate of the submarine. As no debris field was reported in the Sound it as assumed that the U-boat slipped back out to sea. No ship reported another submarine during the course of the war so it can be presumed that the German naval command abandoned any plans to clog the shipping lanes within Pamlico, Currituck and Albemarle sounds. But the torpedo was seen again, twice in the 1950s.

It has been speculated that when the torpedo struck the HESTER PRYNNE the glancing blow either damaged the interior wiring or created a crack in the hull of the torpedo tube which allowed seawater into the component compartment. As the United States Coast Guard concluded, what did not happen was that the torpedo ran until its power was extinguished and then sank to the bottom. As the torpedo continued to make appearances, the only logical explanation was that its electrical wiring was randomly bringing the metal fish back to life.

The first appearance of what become known as the “Phantom Torpedo” occurred in June of 1947 when it spotted running along the surface. It was only spotted because it was assumed to be a great white shark, a rarity in Pamlico Sound and thus the only reason the torpedo was captured on film. This was also fortunate as without the photograph the Coast Guard would have been unconvinced that a torpedo had been involved. A search of the bottom west of Gull Island with submarine metal detectors did not reveal the torpedo.

The next appearance was bit more hazardous. In December of 1948, the torpedo bumped into the hull of a tour boat just off Gull Island. Again it was captured on film, this time by a group of lawyers from New York cities. They reported that the collision was so slight that the Coast Guard assumed that the torpedo was expending the last of its power. Another search by the submarine metal detector was fruitless.

To date the torpedo has not made another appearance. Though it may be gone in metal form, the “Phantom Torpedo” lives still on tourist memorabilia along the Outer Banks accompanied by the line “Like the South it shall rise again.” It has inspired SCUBA expeditions to the west of Gull Island and there is an active Phantom Torpedo Fan Club in Skyco. Local historians continue to hope that when the Second World War related documents of the United States Navy and Coast Guard are opened that the full story of the encounter in Pamlico Sound will be revealed.

[This short story is from Steven Levi’s faux history of the Outer Banks HOW NAGS HEAD LOST ITS APROSTROPHE available on Kindle.]