She was one of the most remarkable women of the 20th Century. But Coco Chanel’s reputation is again under scrutiny over allegations that she was a Nazi agent in World War II France.

To millions of people around the globe, Chanel stands for style, opulence, and understated elegance, from haute couture worn by the few to ready-to-wear treasured by the masses. Her achievements are undeniable. Chanel’s instantly recognizable suits have been sported by stylists from the Duchess of Windsor to Carla Bruni-Sarkozy.

Jackie Kennedy was wearing a pink version when JFK was assassinated in Dallas in 1963.

And, the “little black dress”, that byword for elegant simplicity has regularly topped polls for the most iconic of all items of clothing.

But there is another side to the story of Gabrielle “Coco” Chanel, and it concerns her actions in occupied France during World War II.

Like many luminaries, including the singers Edith Piaf and Maurice Chevalier, the writer Jean Cocteau and the late president Francois Mitterrand, Chanel remained in her native country following its occupation by German forces in the summer of 1940.

And since the war’s end, rumors have abounded about the real nature of her association with the Nazis.

Now according to Hal Vaughan, author of the new book, sleeping with the Enemy, Chanel is revealed as having actually worked for German military intelligence during the war.

“Being a Nazi agent was “part of her daily life” in Paris during the occupation,” he says.

“Chanel was a consummate opportunist. The Nazis were in power, and Chanel gravitated to power. It was the story of her life.

Chanel didn’t believe in anything, except fashion. Chanel believed in beautiful clothes, she believed in her business and rightly so; she didn’t care about Hitler or politics or Nazism.”

Ensconced in the luxury of the Hotel Ritz, a privilege permitted to few non-Germans, Chanel, who had closed her shops in France at the outbreak of war, was in constant contact with the country’s new Nazi overlords.

Key to the new allegations is her affair with the dashing 44-year-old German officer Baron Hans Guenther von Dincklage who, Vaughan says, “has been treated by every biographer as a kind of playboy tennis man”.

He wasn’t. He was a professional Abwehr [German military intelligence] officer, who had been operating in France since the late 1920s.

“He manipulated Chanel, and Chanel manipulated him.”

It was von Dincklage who arranged the 57-year-old Chanel’s stay in the Ritz and who managed her business relations with the occupation authorities.

In return, Vaughan says, the Abwehr signed Chanel up as Agent F-7124, codenamed “Westminster” after a former lover, the second duke.

In a gavotte-like relationship, the feisty Chanel maneuvered for the release of her nephew, Andre Palace, from a prisoner-of-war camp in Germany.

Beyond this, the Abwehr dangled before her the enticing prospect of taking control of the highly profitable Chanel perfume business, which she had licensed to the Jewish Wertheimer brothers in 1924.

Indeed, she did make a claim to the company under Nazi “Aryanisation” laws, not realizing that the Wertheimers, by then safely in the United States, had handed control of the firm to a Christian.

While agreeing that Vaughan’s book adds some new detail to Chanel’s war years, the writer Justine Picardie, whose biography, Coco Chanel: The Legend and the Life, was published last year, believes that Chanel’s motives were “a bit more subtle and nuanced”.

“Everything she did was a paradox. She was so contradictory. On the one hand, she did make anti-Semitic remarks. But then some of her best clients were Jewish, like the Rothschilds, and indeed her business partner was Jewish, and he continued to be her business partner after the war.”

But what did Chanel really do as an agent? Well, after having been promised that her nephew would be released, it seems that she travelled to Madrid in August 1941 with the special dispensation of the Germans, in order to use her contacts to gain political intelligence.

According to a document cited by Vaughan, though, this visit only saw her exchanging banalities with a British diplomat who reported that: “the Germans cannot understand the French and this is making them hate them to the point that she, Mlle Chanel, is afraid of what will happen.”

Vaughan readily accepts that Chanel was never a spy. “Espionage ­- you take photographs, you take documents.­- Chanel never did that,” he says.

“She was a facilitator. She knew everybody in Spain, she knew everybody in England, and she helped out the Nazis.” At the war’s end Chanel, who fled to Switzerland, was spared from being tried as a collaborator. Vaughan says due to Churchill’s intervention, others say because of the British royal family.

Returning to Paris in 1954, her re-establishment in the couture business was financed by none other than Pierre Wertheimer, one of the men she had sought to dispossess during the war.

Coco Chanel died, aged 87 in January 1971, appropriately enough in her wartime home, the Hotel Ritz in Paris.

War and conflict always reveal the survival instinct. Coco Chanel, who had risen from a Catholic orphanage to become the mistress of all she surveyed, was a born survivor.