8th Suspect in Navy Jet Fighter Parts Smuggling Ring Arrested

A Massachusetts man who federal authorities say stole $1 million in F-14 fighter parts was arrested at his home Thursday, bringing to eight the number of people who have been arrested in a San Diego-based ring that allegedly smuggled sophisticated military parts to Iran, authorities said Thursday.

Arrested about noon Thursday at his home in Leominster, Mass., was Daniel Wheeler, 33. He was arraigned in federal court in Worcester, Mass., and charged with stealing $1 million in F-14 fighter parts while working as a civilian at the Naval Air Rework Facility North in Norfolk, Va., according to Assistant U.S. Atty. Philip Halpern in San Diego.

Halpern said Wheeler was employed as a civilian products controller for the Navy, and it was in that capacity that he is alleged to have stolen airplane parts once every two weeks since at least 1981.

The arrest warrant identified circuit boards and gyroscopes as parts taken by Wheeler, but Halpern declined to specify what else, if anything, may have been stolen.

A key in linking Wheeler to the ring, Halpern said, was an Internal Revenue Service investigation supposedly showing that Wheeler banked more than $75,000 for his role in the illegal scheme.

Wheeler will be extradited to San Diego, probably in about 10 days, Halpern said. He faces a hearing Monday in Worcester.

While federal prosecutors now believe that all the major players involved in the scheme have been arrested, they said the investigation is continuing and more arrests are possible.

“I believe we got the major people involved. Mr. Wheeler is following in that tradition,” Halpern said. “It’s an ongoing investigation and I can’t comment on further arrests. It was clear from the outset it wasn’t just limited to these eight people.”

In July, after the indictment of seven people, U.S. Atty. Peter Nunez said he didn’t expect any more arrests in the case.

Already in custody in San Diego are Franklin P. Agustin, 47, the alleged ringleader; his wife, Julie, 46; his brother, Edgardo, 45, and Primitivo B. Cayabyab, a 17-year Navy veteran and aviation storekeeper on the aircraft carrier Kitty Hawk.

Pedro M. Quito, 60, a retired sailor and Navy civilian employee, and Antonio G. Rodriquez, a 16-year Navy veteran and aviation storekeeper on the Belleau Wood, a helicopter assault ship, are free on $500,000 bail each.

An Iranian national, Saeid Asefi Inanlou, was arrested by British authorities in July. At the time of the arrest, they confiscated more than $2 million worth of U.S. aircraft equipment, including three sophisticated computers, four inertial navigation aids and two weapons indicator controls.

The Iranian was released by the British on $150,000 bail.

Wheeler worked as a civilian Navy employee from 1976 until this year, when he went to work for an electronics company in Concord, Calif. Before his civilian employment, Wheeler served in the Air Force and Navy.

According to Halpern, Edgardo Agustin’s sister, Belita Agustin Tugbang, was the person who brought Agustin and Wheeler together. Tugbang introduced her brother to Wheeler’s wife, Virginia.

Initially, Agustin talked to Virginia Wheeler about obtaining electronic parts from the Naval Air Rework Facility, Halpern said. Agustin eventually met Wheeler, who agreed to steal F-14 fighter parts with the knowledge that their destination was Iran, according to the FBI.

Wheeler allegedly passed the parts to Agustin in New York, according to the arrest warrant.

He was arrested at his home without incident by a team of FBI and Customs Service agents. One customs official involved in the arrest said Wheeler seemed to be “waiting for a loud knock at his door.”

No airplane parts were confiscated.

Halpern said the arrest of Wheeler was part of a combined investigation that included the FBI, INS, Customs, the U.S. attorney’s office in San Diego and Naval Investigative Services. Halpern said the team investigation was noteworthy because of reports of friction among the various agencies at the beginning of the probe.

“That’s how it is sometimes with big organizations,” said Halpern, who didn’t refute the earlier reports.

As to his boss’s comments in July that no further arrests were expected, Halpern said Nunez’s statements “were accurate at that point because we didn’t expect more arrests right then . . . you know, like in the next week.”