20-Year Prison Term for ‘Techno Bandit’ Urged; Ongoing Exports to Soviets Cited

Expressing fears that he is continuing to direct his illegal exporting empire from prison, federal prosecutors on Thursday sought a 20-year prison sentence for West German businessman Werner Bruchhausen, convicted in the diversion of millions of dollars worth of high technology to the Soviet Union.

The so-called “techno bandit” already has caused “incalculable damage” to American security, federal authorities said in seeking the stiffest sentence ever imposed for technology diversion as a way of clamping down on Bruchhausen’s operations and sending a signal to foreign governments.

“It is important to demonstrate to the world that the United States will not passively accept such violations and that no entrepreneur is untouchable,” Customs Commissioner William von Raab said in a recent letter urging a substantial prison term.

The sentencing memorandum prepared by Assistant U.S. Atty. William F. Fahey also contains reports from the Central Intelligence Agency indicating that Bruchhausen, who bought and sold technology so secret that it had not even been shared with U.S. allies, is continuing to operate his network from prison on Terminal Island.

‘Not Much Impact’

“Our belief and our intelligence suggests that Bruchhausen’s incarceration did not have much of an impact on his ability to maintain contact with the Soviets and to use his network to provide the Soviets with state-of-the-art high technology,” Fahey said in an interview Thursday.

“There is still contact with the Soviet Union and there are some limited exports that he’s been able to facilitate, even while in prison,” Fahey said, declining to specify Bruchhausen’s prison contacts because of intelligence concerns.

Bruchhausen, 47, is awaiting sentencing at the federal detention facility at Terminal Island for his conviction on 15 counts of mail fraud stemming from his diversion of an estimated $6 million in American technology to Soviet-bloc countries over a 10-year period.

The international network he headed from his mansion near Munich, Germany, through a variety of California purchasing arms was responsible between 1975 and 1985 for Soviet acquisition of a wide variety of sophisticated technology, including computer testing systems and secret military communications equipment that allowed Soviet-bloc countries to monitor North Atlantic Treaty Organization forces.

“The government views this case as extraordinarily serious,” Fahey said in his recommendations to U.S. District Judge Alicemarie Stotler, who is scheduled to impose sentence in Los Angeles on Monday. “Bruchhausen’s long-term conduct caused the United States incalculable damage and provided the Soviet bloc with direct military and commercial benefits.”

Bruchhausen, Fahey said, “must be severely punished for the tremendous harm he has caused to our national security. . . . Bruchhausen’s long-term scheme cries out for the most severe sentence ever imposed on a high-technology diverter.”

20-Year Term

The 20-year prison term the government is recommending is longer by several years than the previous record term handed down in an Iran arms shipment case, but short of the 75 years the court could legally impose. Federal prosecutors are also seeking a $15,000 fine, the maximum allowable.

In a CIA communication attached to the sentencing recommendations, federal authorities emphasized that Bruchhausen’s sentence will have a “major impact” on national security and foreign policy because of the interest demonstrated by foreign governments in the case.

“Our . . . allies, who often do not share our concerns over the damage diverters such as Bruchhausen have done, often question U.S. motives on export controls, suspecting that we are trying to gain additional sales at their expense rather than caring about national security,” wrote McClellan A. DuBois, chairman of the CIA’s technology transfer intelligence committee.

“A light sentence for Bruchhausen may well confirm their suspicions,” DuBois said.

Bruchhausen’s attorney, Alan May, could not be reached for comment on the recommendations.

In the past, he has depicted his client as a victim of lying associates and government officials who set him up. “He was convicted because he’s considered a political enemy of our state,” May said after the conviction.