At 13.06 hours on 10 July 1940 the unarmed Alwaki (Master Johan Martijn Schlögl) in station #63 of convoy OA-180 was hit on the port side by two dud torpedoes from U-61 about 10 miles northeast of Cape Wrath. The convoy was en route in two columns and passed almost directly over the submerged U-boat, which found itself between the columns and hastily attacked and then submerged as they were in danger of being rammed. The two G7e torpedoes were fired from a distance of just over 200 meters, too close for the warheads to arm until they penetrated the hull of Alwaki as second ship of the starboard column. In absence of an explosion the escorts were unaware of the attack and the U-boat escaped undetected.

After the ship shuddered from the impacts the crew stopped the engines to investigate her for damage and she immediately developed a list to port as the torpedoes had punched holes of about two feet in the engine room and #2 hold through which the ship was slowly flooded. The crew was unable to reach the leaks because one was behind auxiliary machines and the other in a hold filled with coal and to make things worse a bulkhead could not be closed. Most of the crew and ten Iraqi passengers abandoned ship in three lifeboats while the officers tried to save the vessel and were soon joined by a boarding party of HMCS St. Laurent (H 83) (Cdr H.G. De Wolf, RCN). At 14.15 hours, they all had to abandon ship because the list increased to over 45° when the coal in the hold began to shift. The survivors were picked up by the rear ship of convoy, the Harmonic and landed at Cardiff on 13 July. The tug HMS Bandit (W 69) tried to salvage the ship, but she foundered at 22.07 hours. The Admiralty investigated the case and came to the erroneous conclusion that sabotage was probably the cause of her loss.