Ex-Agent Indicted in Spying Probe

A former FBI agent briefly assigned to the bureau’s Chinese counterintelligence squad in Los Angeles has been indicted on charges of tipping off the subject of a national security investigation.

Denise K. Woo, 45, was charged with disclosing the existence of a national security wiretap, revealing the identity of a covert operative and lying to FBI agents.

She is the second agent who worked for the beleaguered intelligence unit to be indicted on criminal charges.

A retired veteran of the China squad, James J. Smith, was charged last year with gross mishandling of sensitive documents that allegedly fell into the hands of accused Chinese double agent Katrina Leung, Smith’s longtime lover and a paid government informant.

Smith was also accused of covering up for Leung after he learned that she had been working at the same time for the Chinese Ministry of State Security.

The episode prompted a shakeup by FBI Director Robert S. Mueller III, resulting in the reassignment of the China squad section chief in Los Angeles and the removal of a high-level counterintelligence official in Washington.

Smith pleaded guilty earlier this year to a reduced charge of lying to his superiors about his extramarital affair. He is awaiting sentencing.

But Woo’s lawyer said Friday that his client was innocent of any wrongdoing. Mark Holscher, who helped Chinese American scientist Wen Ho Lee in his successful battle against espionage charges, said he was representing Woo on a pro bono basis because she was a victim of FBI “scapegoating.”

“Denise Woo was forced to assist in an espionage investigation of an innocent man, and the FBI unfortunately has sought to criminalize her efforts to prevent a terrible tragedy,” Holscher said.

The defense attorney declined to elaborate on his statement or divulge any other details of the case because, he said, they involved matters classified by the government. The U.S. attorney’s office would not comment.

Richard Garcia, assistant director of the FBI and head of the FBI’s Los Angeles Division, said only that “the FBI investigates leads pertaining to counterintelligence and espionage, even if it involves one of their own.”

Woo, a Chinese American, had been assigned to white collar investigations when she was loaned to the China squad to assist in an investigation in 1999, according to federal sources.

The investigation focused on a Chinese American who worked for a defense contractor and was suspected of passing sensitive information to the Chinese government. According to one source, Woo was recruited because she knew the subject of the investigation as a family friend.

Although that investigation did not result in criminal charges, Woo’s allegedly inappropriate disclosure of FBI matters led to an internal inquiry.

She was first questioned by FBI agents in 1999, placed on administrative leave about 2001 and was subsequently fired.

Last week, Woo was named in a five-count indictment that also accused her of lying to FBI agents about her dealings with the alleged subject of the investigation, identified only as “J.W.”

The indictment accuses her of intentionally disclosing to “J.W.” the covert operative’s name and place of operation, and of tipping him and “one or more others” to the existence of a wiretap obtained under the Foreign Intelligence Surveillance Act.

Woo did so, the indictment charged, in order to obstruct and impede investigators.

On Nov. 1, 1999, according to the indictment, she lied to FBI interrogators when she denied passing the information to the subject.

Woo was indicted by a federal grand jury last week and arraigned Monday by a federal magistrate judge, who ordered her freed on $50,000 bond. The case file was immediately sealed, but The Times obtained a copy of the indictment Friday.

Within the FBI, some agents and supervisors expressed surprise at the indictment. Without excusing Woo’s alleged misconduct, they also distinguished between the potential effect on morale from her case and the widespread embarrassment many felt last year when Smith was indicted.

“There’s no comparison,” said one agent, speaking on condition of anonymity. The Woo case allegedly “took place over months.” Smith “was sleeping with a source for years.”

Smith’s co-defendant, Leung, is awaiting trial on charges of illegally copying and possessing three classified FBI documents that officials said she had taken from his briefcase during his visits to her San Marino home.

Leung, a Chinese American businesswoman, has denied any wrongdoing and says she acted at the direction of Smith and other FBI agents during her 20-year career as an undercover operative. Smith has agreed to testify against Leung if the case goes to trial.