On 7 January 1942 the Caledonian Monarch (Master James Valentine Stewart) straggled from station #52 in convoy SC-63 and was reported missing thereafter. One week later convoy encountered severe bad weather and was dispersed in 54°00N/42°22W. No trace of the ship or her crew were ever found and she was considered lost either to enemy action or marine causes on 14 January. The master, 41 crew members and six gunners were lost.

At 04.11 hours on 22 January, U-588 fired one torpedo at an unescorted steamer of 6000 tons and observed a hit amidships about 30 miles north-northwest of Lewis, Outer Hebrides. The U-boat had spotted the ship about 70 minutes earlier and missed with a first torpedo at 03.18 hours. As the vessel only settled slowly, the U-boat waited for the crew to abandon ship and then fired a coup de grâce from the stern torpedo tube at 04.46 hours. The torpedo struck forward and caused the steamer to sink fast by the bow. The Germans reported five fully occupied lifeboats, but were not able to identify the vessel. However, assuming that the Caledonian Monarch had not been lost and had continued to Loch Ewe, she could have been the ship sunk by U-588.

Earlier it was thought that this ship was sunk by U-333 (Cremer) at 13.15 hours on 18 January in position 47°30N/40°30W (grid BC 65). Cremer reported sinking an unescorted steamer of 8000 tons about 500 miles east of St. John’s, Newfoundland. But according to Lloyds it is inconceivable that the Caledonian Monarch would have been in the same position as the U-boat. So the victim of Cremer, if any, is still unidentified.