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Boeing Probed Over Sensitive Rocket Data

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WASHINGTON POST

A federal grand jury in Seattle is investigating whether Boeing Co. violated criminal laws by improperly sharing sensitive rocketry data with Russian and Ukrainian technicians working with the company on a sea-launched satellite project, sources said.

News of the grand jury probe could not have come at a worse time for Boeing because the project, called Sea Launch and based in Long Beach, is scheduled to loft its first satellite into space only weeks from now.

In October, Boeing agreed to pay a $10-million fine to settle civil allegations that it broke export laws by conveying information to foreign engineers without authorization on 207 occasions over four years. In that consent decree, the firm did not admit to wrongdoing, but elsewhere it has acknowledged its security procedures were lax.

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The U.S. attorney’s office in Seattle is leading the investigation, which was first reported in Monday’s editions of the Seattle Times. The probe focuses on the company and the foreigners who received the technical data.

Investigators are examining, among other things, an allegation that some of the Russian and Ukrainian individuals who received the technical briefings and were given access to controlled areas were intelligence agents for their countries. Electronic recording equipment was found at the home of one of the Russians, sources said.

Boeing officials were not available for comment.

In a four-year period ending in mid-1998, Boeing failed to secure some State Department licenses it needed to share information with its foreign partners in Sea Launch. Work on the project at the Port of Long Beach was halted for several months until Boeing reached the consent decree with the government.

Sea Launch is a highly innovative project both in its technology and in the international partnership that created it. Boeing, which owns 40% of the venture, is in charge of launching a 20-story Ukrainian rocket, powered by a Russian engine, off a launch pad bobbing in the Pacific Ocean. The launch is to be controlled by U.S. and Russian mission-control computers installed in a Norwegian-built ship.

The venture has operated under bizarre restrictions since its origins in the early 1990s. If Boeing engineers noted mistakes by their partners in Russia’s RSC-Energia and Ukraine’s KB Yuzhnoye, the Americans had to stay quiet for fear of educating them about technologies that could help them modernize Russian ballistic missiles.

The Justice Department also is investigating whether two other leading satellite companies, El Segundo-based Hughes Electronics Corp. and Loral Space & Communications Ltd., improperly shared technical data about rockets with foreigners.

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