George Seaton, one of Hollywood’s forgotten men, made his initial reputation as a comedy writer in the 1930s (he worked on “A Day at the Races” for the Marxes and a version of “Charlie’s Aunt” for Jack Benny). But he found his true metier in the postwar era, building sand castles of humor, drama, sentiment, and social observation on the mud of personal anguish and moral quandaries. In his best films – “Miracle on 34th Street,”

“Apartment for Peggy,” “The Big Lift,” “Little Boy Lost,” “The Country Girl,” “Teacher’s Pet,” “The Pleasure of His Company,” “The Counterfeit Traitor,” “Airport” – a moment invariably arrives when the protagonist slumps under the world’s weight or realizes everything he believes is wrong.

As a writer-director, Seaton enjoyed a long association with producer William Perlberg, which allowed him an unusual degree of control in choosing and realizing his projects. They made about 20 films together (not counting those they co-produced and assigned to other directors), and nearly half were successful financially and critically. Yet their work is rarely considered as an oeuvre, despite Seaton’s consistent themes of personal disorder and growth.

His contemporaries considered Seaton a clever writer (four Oscar nominations, two wins) and a journeyman director with a knack for eliciting defining work from actors – among them Edmund Gwenn, Bing Crosby, Montgomery Clift, William Holden, Lilli Palmer, Clark Gable, Gig Young, Doris Day, Helen Hayes, and two remarkable 9-year-olds, Natalie Wood and Christian Fourcade. He won an Oscar for Grace Kelly – but, then, the Academy always crowns a glamorous woman who wears ratty clothes and underplays the Max Factor.

Seaton’s talents far outweigh his shortcomings in “The Counterfeit Traitor” (1962). A popular film in its day, it improves with age, partly because the passing of time underscores the honest treatment of its reluctant hero, World War II’s industrialist-spy, Eric Erickson. Seaton’s telling is reasonably accurate, and the liberties he took underscore the ambiguities of espionage, a world in which a Nazi may behave more decently than a democrat.

The subject isn’t good and evil, but the necessity of ruthlessness: In war, the most ruthless team wins. By the time Erickson, played with unerring authority by William Holden, says that a Jew whose life he tried to save “choked to death rather than cough,” we can’t be certain Eric didn’t suffocate him. The film ends on that note of uncertainty.

Erickson’s story, first reported in 1945 but little known until Alexander Klein fleshed it out in his stiff novelistic book, “The Counterfeit Traitor” (1958), was that of an American businessman who gave up his citizenship to build an oil-importing business in Stockholm. Recruited by America’s ambassador to Russia two years before Pearl Harbor, Erickson eagerly accepted the challenge of creating a cover to give him access to German oil refineries; his information triggered numerous Allied bombing raids, but required him to stalk and murder an acquaintance he thought would turn him in, and it cost him friends and family. Only his wife and Sweden’s Prince Carl Bernadotte knew of the deception, which concluded with a safe return to Stockholm under the protection of no less a protector than Himmler.

In the film, Erickson is blackmailed into spying. His unknowing wife leaves him (how, I wonder, did the real Mrs. Erickson feel about that?), AND he evolves from a business-obsessed opportunist to a willing freedom-fighter. He also undergoes a long, grueling escape from Germany – a bow to movie conventions. Seaton, though no master of suspense, tricks up this sequence with such memorable touches as a dominatrix-spy, Gestapo dogs befuddled by cocaine, and the Hitchcockian intervention of hundreds of Danish bicyclists. His main interest, however, lies with Erickson’s character: The ease with which a blackmail victim becomes an accomplished blackmailer, and the disparity between his avowed doubts and evident relish as he outsmarts everyone, friends and enemies alike.

The first quintessential Seaton moment is the depiction in long shot of a slow hanging that changes Erickson and his German confederate into activists. This scene is played with no visible emotion. Seaton delays the expression of horror for two episodes that everyone seems to remember: one in which Erickson’s lover, Marianne von Mollendorf, realizing that she has confessed her activities to a Gestapo agent, not a priest, and another in which Erickson witnesses her execution.

In life, Erickson was made to stand on the prison grounds, remaining impassive. The film is more dramatic: He awakes alone in a cell, sees her in the courtyard, and cries out her name as she is shot. They both reach their arms out at the climactic moment. It may sound like melodrama, but it plays as credibly harrowing, because the shots are edited with meticulous economy and because the radiant, never-better Lilli Palmer plays Marianne. The Holden-Palmer romance is smartly constructed from playacting to chaste descriptions of each other’s private parts (in case anyone should ask) to erotic longing stirred by the nearness of death.

In the era of James Bond best sellers, “The Counterfeit Traitor” recalled Ambler and prefigured Le Carre. Seaton’s film has another precedent in Fritz Lang’s “Cloak and Dagger” (1946), also based, much more loosely, on a true story involving an American scientist sent undercover and aided by an Italian agent – Palmer in her Hollywood debut. Elements of “The Counterfeit Traitor” later showed up in Hitchcock’s botched “Torn Curtain,” particularly the idea that spying requires callousness verging on sadism.

Holden communicates this very well in the film, aided by such disarming dialogue as, “I’ve lost all my friends and been dropped by every club except the Book of the Month,” and “[Goebbels] was oily and over-polite and so was I,” and “My conscience has always been like a well-trained dog.” In unleashing Erickson’s conscience, the film doesn’t dilute (as Steven Spielberg’s portrayal of Oskar Schindler would) the depiction of a businessman, heroic and quick, but nonetheless a smooth bastard. When told that Nazism preaches sacrifice and not profit, he replies, “And business must profit, not sacrifice. Amazing how they get along.” After arguing over the side effects of their intelligence – the ghastly phrase, “collateral damage,” was not yet coined, and no attempt is made to jerk glib tears to memorialize the 120 children incinerated in a raid – it is Erickson who haplessly suggests that Marianna see a priest.

Paramount’s DVD is bargain-priced and no-frills; it doesn’t even have a trailer. But, except for a brief distortion near the two-hour mark, the transfer ably captures the splendid location photography of Jean Bourgoin (he also shot “Mon Oncle” and “Black Orpheus”), which is at once sumptuous and believable – you can almost breathe the air and varied light of Stockholm, Berlin, and Copenhagen. The audio track does justice to both Alfred Newman’s score, combining percussion-and-brass fanfares with spiraling strings, and Holden’s narration – a reminder that, along with Orson Welles and James Earl Jones, he possessed one of the most decisive voices in American movies.