Plot to Buy Steel for A-Arms Alleged

For more than six months, Arshad Z. Pervez, a Pakistan-born Toronto businessman, allegedly struggled to buy a quarter of a million dollars worth of special-purpose steel needed to make nuclear weapons. He allegedly haggled with a U.S. official over how big a bribe he would have to pay to export the metal to Pakistan.

What Pervez did not know during the negotiations that started last November was that, at all times, he was dealing with undercover agents of the U.S. Customs Service, according to information filed with the U.S. District Court in Philadelphia.

On Tuesday, Pervez appeared at a preliminary hearing on charges that he conspired to violate U.S. export restrictions on nuclear technology. He was ordered held without bond until his trial.

U.S. law enforcement officials involved in the case say they believe he was working for the government of Pakistan--a suspicion that could cause new frictions between the United States and that nation, which has refused to sign a nuclear non-proliferation treaty.

Pakistan has long been rumored to be trying to develop its own nuclear bomb to match the one tested more than a decade ago by India, its bitter rival on the Asian subcontinent. The government obtained some components of a bomb factory from China and nongovernment experts say it apparently is very close to being able to explode a test nuclear device.

Pakistan has consistently denied that it has, or is developing, a nuclear weapon but a senior nuclear scientist for the government stirred up a furor earlier this year when he was quoted in the Indian press as confirming the existence of a Pakistani nuclear weapon.

The Reagan Administration, reportedly in deference to Pakistan’s role as a conduit for U.S. aid to anti-Communist rebels in Afghanistan, so far has resisted pressure to withdraw the nation’s U.S. foreign aid and has issued only warnings about weapons research.

Assistant U.S. Atty. Amy Curland, who is prosecuting the case, described the investigation as a “sting,” although she said Pervez made the first move. She said he contacted Carpenter Steel Corp., of Reading, Pa., with an offer to buy 50,000 pounds of maraging 350 steel--alloys of extremely high strength--and a quantity of beryllium.

John R. New, a special agent of the Customs Service, said in an affidavit that Pervez at first claimed that the steel would be used in Pakistan for “turbines and compressors,” but Carpenter Steel officials told him that such a use would require far more of the metal.

In the sworn statement, New said a company official “suggested to Pervez that the material was in reality going to be used in a gas centrifuge enrichment plant to make nuclear weapons. . . . Pervez nodded his head in the affirmative.”

New, alerted by the company, posed as a Carpenter representative. Another customs agent, Frank Rovello, posed as a Commerce Department official who could issue an export license for the steel and beryllium.

New said that Pervez originally offered Rovello a $5,000 bribe, then changed his mind and finally paid only $1,000, with a promise of $2,000 more when the license was approved.

Curland said the steel, which is only produced to meet special orders because of its high cost and short shelf life, “was never manufactured nor was it intended that it be manufactured.”