FBI Unable to Build Case Against Scientist Linked to China Leaks

The FBI’s efforts to prosecute suspected Chinese spy Wen Ho Lee “hit the wall” in recent days despite his admission that he was approached by Chinese intelligence agents during a trip to Beijing in 1988, a senior law enforcement official said Saturday.

The agency has been unable to build a case against Lee, who was dismissed from his position at the Los Alamos National Laboratory last week, because of a lack of hard evidence and his refusal to cooperate with investigators even after failing polygraph tests, the senior official said.

The official, who is closely involved with the case, said Lee admitted during an FBI interview last weekend that he was contacted by Chinese agents during an authorized visit to Beijing in 1988. But he insisted he had rebuffed the overture.

At the time, Lee was a respected scientist who worked on supercomputer codes in the laboratory’s top-secret “X Division,” which is responsible for theoretical nuclear weapon design and applied computational physics.

Scientist Is Prime Suspect in Probe

Lee, a naturalized American born in Pinggtung in southern Taiwan, is the prime suspect in a three-year FBI probe into possible espionage at Los Alamos. The investigation seeks to determine if Lee passed classified information on America’s most advanced nuclear warheads to China, especially during a visit there in 1988. He has not been arrested or charged.

Lee was fired last week, in part, because he did not reveal the 1988 contact upon his return to Los Alamos. “He made statements that we did not know before, and that was grounds for his termination,” the official said.

During a series of FBI interviews that began Dec. 23, Lee was “cooperative with the FBI, but he denied he ever passed classified information,” the official said. But Lee failed at least two polygraph tests, he added, “so obviously the focus is on him.”

But the case is “very difficult,” the official said. No evidence indicates that money changed hands, for example, and most of the case is analytic and circumstantial.

“It’s going to be very hard to bring this to a conclusion unless he comes in and tells us what really happened,” the official said. “Once he knows there’s an investigation, and he gets a lawyer, in my opinion, we’ve hit the wall.”

Lee joined the nuclear weapon program in 1979 at the Argonne National Laboratory near Chicago, moving several years later to Los Alamos. He was planning to retire at the end of this year.

The Lee case has focused new light on little-noticed reports by the General Accounting Office, the investigatory arm of Congress, that describe serious security lapses at the nation’s nuclear weapon laboratories.

In one report, GAO investigators said security was so sloppy at the three labs until last fall that foreign visitors, including suspected spies, often were allowed 24-hour, unescorted access to areas where sensitive and classified information was stored. In one case, the material was stashed in boxes placed in an open hallway.

But the Department of Energy largely ignored recommendations contained in the 1988 report. A follow-up GAO report in 1997 and a separate FBI investigation determined that counterintelligence efforts were still flagrantly ineffective at the Los Alamos, Sandia and Lawrence Livermore national laboratories.

Reports Cite Lax Security Procedures

Indeed, at least eight visitors with “suspected foreign intelligence connections” were allowed access to Los Alamos, and five to Sandia, without undergoing background security checks between 1994 and 1996, according to the GAO. Another eight were approved to visit Sandia, but records were so shoddy that investigators couldn’t determine if they actually came.

The GAO’s security concerns were aired before members of Congress in October by Assistant Comptroller General Keith Fultz, who told a House national security subcommittee that the nuclear weapons labs are “targets of foreign espionage efforts and investigations have shown that security has been jeopardized.”

Fultz complained that “essentially the same problems” that the GAO identified in 1988 still were occurring a decade later, despite promises by Energy Department officials to correct them, according to his prepared testimony.

“The security controls in areas most frequently visited by foreign nationals do not preclude them from obtaining sensitive information,” Fultz said. “Foreign nationals have been allowed after-hours and unescorted access to building. In some instances, they have had access to sensitive and classified information.”

At one lab, which he did not identify, investigators found six boxes of papers, marked “sensitive material” in large red letters, left in a public hallway.

At other times, sensitive subjects, such as the use of high explosives and special cameras to record nuclear detonations, were discussed in front of foreign visitors. “Consequently, information useful to weapons programs may have been provided to foreign nationals without [the Energy Department’s] knowledge,” he said.

Overall, only a handful of foreign visitors were given background security checks, according to the 1997 GAO report. Los Alamos, for example, prechecked only 12 of its 746 Chinese visitors between 1994 and 1996. Sandia checked only two of its 244 Chinese visitors in those years; Livermore reviewed 185 of its 474 Chinese visitors.

Ernest Muniz, the Energy undersecretary, denied Saturday that the department had ignored the GAO report. “We responded very specifically,” he said. “A system was put in place. Now it is being strengthened.”

A top-level, interagency assessment in mid-1997 of Lee’s case and dramatic security lapses and espionage threats at the three weapons labs led President Clinton to order a sharp tightening of internal controls in February 1998.

The changes weren’t implemented until September, however, when Energy Secretary Bill Richardson took over from the outgoing secretary, Federico Pena. A spokeswoman said the seven months were used to hire a new counterintelligence director, former FBI agent Edward J. Curran, who conducted a follow-up assessment and prepared specific recommendations.

In a telephone interview, Richardson said he ordered “very drastic measures,” in line with Clinton’s directive, to better guard secrets at the labs, which are responsible for developing and maintaining the nation’s nuclear arsenal.

“We’ve instituted regular polygraphs” of lab scientists, Richardson said. “The only other agency to do that is the CIA.”

Richardson said he has mandated background checks on all visitors from a list of 22 “sensitive” countries, from Algeria to Uzbekistan. In addition, he said, foreign scientists must be escorted at the labs, and not allowed to roam at will.

The department has doubled its counterintelligence budget every year since 1996, when it was $1.8 million. Last year’s budget was $7.6 million, the current allocation is $15.6 million, and next year’s is tagged at $31.2 million.

“I believe we’ve taken very strong action,” Richardson said.

To be sure, no evidence has surfaced in Lee’s case to suggest foreign visitors stole classified material from the labs. In fact, most known cases of nuclear spying were perpetrated by Americans working on behalf of foreign governments.

“The real danger is not so much foreign visitors coming in as the recruitment of people who are already there,” an administration official said Saturday.

In Lee’s case, the FBI and CIA are investigating whether he provided top-secret information that helped Beijing shrink the size of its nuclear warheads.

U.S. officials fear that China learned how American scientists built the high-yield W-88 nuclear warhead, a state-of-the-art weapon mounted atop D-5 missiles in Trident submarines.