Chinese Spy Case Produces Heavy Fallout, Little Else

FBI agents shadow Wen Ho Lee constantly these days, watching and trailing the former nuclear weapons expert so closely that the feds call it “bumper-lock surveillance.”

“He hears footsteps behind him,” one official said. “It’s 24 hours a day, wherever he is. Multiple agents follow him.”

Yet even though Lee’s case continues to have widespread repercussions, including an internal overhaul of the Energy Department’s nuclear weapons programs and a likely Senate vote this week to force a more sweeping restructuring, the Taiwan-born scientist and U.S. citizen remains in legal limbo.

Lee, who was fired six months ago from the Los Alamos National Laboratory and publicly identified as a possible spy, has been the subject of a three-year FBI investigation into whether he gave secrets to China about America’s most advanced nuclear warhead. Yet he has been neither arrested nor cleared.

Justice Department lawyers, in fact, have given up on charging Lee with espionage. They instead have dusted off an early-1980s in-house analysis of an obscure law that has never been used for a criminal prosecution. Under the statute, revealing national defense information through “gross negligence” is punishable by up to 10 years in prison.

The debate now is whether Lee can be convicted of breaking the law when he downloaded highly classified computer programs and data files from more than 1,000 nuclear weapons tests into an insecure computer at Los Alamos. Lee has said he protected the files with three passwords and has denied that he passed the “legacy codes” to China or anyone else.

By all accounts, a successful prosecution would be problematic. For a start, prosecutors almost certainly would need to reveal top-secret nuclear weapon documents in open court if they were to prove that Lee jeopardized national security. Energy Department officials have wrestled for weeks to determine how much information can be safely released.

Moreover, a scathing Senate committee report released last month outlined what it characterized as devastating errors in the investigation so far, including the decision to focus on Lee as the only suspect. In addition, Robert S. Vrooman, the former head of counterintelligence at Los Alamos, raised even more potential legal problems when he stated publicly that Lee was unfairly singled out because of racial bias.

If Lee is charged, his lawyers are expected to demand classified documents from the FBI, CIA, National Security Agency and other government agencies to buttress their claim that others who mishandle classified information are not prosecuted. They also may seek to show that thousands of people in hundreds of places, from defense contractors to National Guard posts, have had access to nuclear warhead secrets, not just a handful of scientists at Los Alamos.

“We continue to provide information to the Department of Justice, and we are hopeful that they will not charge Dr. Lee,” said Mark Holscher, Lee’s lawyer in Los Angeles.

John J. Kelly, the U.S. attorney for New Mexico who is in charge of the case, declined through a spokesman to comment.

If Lee is not indicted, the government has an obligation to issue a statement clearing his name, said John L. Martin, a former Justice Department prosecutor who headed every espionage investigation for 25 years until he retired in 1997.

“To put an American citizen under this type of scrutiny, to leak information in a screwed-up investigation and not to publicly clear him, would be horribly improper conduct,” Martin said.

The FBI first opened the “Kindred Spirit” espionage investigation at Los Alamos in 1996, a year after a man later identified as a Chinese intelligence agent inexplicably handed the CIA a document that included design details of several U.S. nuclear weapons, including the W-88, the country’s most advanced warhead. U.S. scientists later concluded that Chinese underground nuclear tests bore similarities to tests of the W-88.

A senior U.S. official who has reviewed classified material on the case said investigators still have no clear evidence to explain how China got the W-88 engineering specs. Indeed, the official said, the espionage case largely begins and ends with that one document.

“We’ve not learned a thing more than that,” the official said. “It’s really still a mystery. There’s no doubt some compromise took place. But we don’t know how much, where it came from or how significant it was for the Chinese program.”

But the near-hysteria sparked by media reports of the case, along with other allegations of Chinese espionage contained in a report by a bipartisan panel led by Rep. Christopher Cox (R-Newport Beach), continues to reverberate.

The most dramatic impact has been the effort to reorganize the Department of Energy. To many in Congress, the mishandling of the Los Alamos case provided indisputable proof that the department needed fundamental changes, not piecemeal reforms.

As a result, on Wednesday the House overwhelmingly passed a defense funding bill that would create a semiautonomous nuclear weapons agency within the Energy Department. Senate approval is expected after a debate scheduled to begin Tuesday.

Supporters say the proposed National Nuclear Security Administration would tighten security and streamline the bureaucracy that now controls the complex of laboratories and other facilities responsible for developing, building and maintaining America’s nuclear arsenal.

Rep. Ellen O. Tauscher, a Democrat whose Northern California district includes the Lawrence Livermore and part of the Sandia National laboratories, said the proposed new agency is “not perfect” but would better coordinate counterintelligence efforts at the labs.

Opponents, including Energy Secretary Bill Richardson, argue that the new agency would weaken lines of authority and make the labs even less accountable. The White House has not taken a position, but Richardson said in a telephone interview Friday that he “most probably” would ask the president to veto the bill.

“It dramatically hurts our security, as well as our environment, health and safety programs,” Richardson said. “I’m for a semiautonomous agency. But this goes way too far.”

Richardson has moved separately to impose strict new security and counterintelligence controls on the labs. His “security czar,” retired Air Force Gen. Eugene Habiger, has ordered locks installed on computer disk drives, tamper-proof tape wrapped on computer cables, and new guns and ammo for guards.

“It’s unfortunate that everyone has to undergo these constraints to do business,” Habiger said. “But we can’t afford to do it any other way.”

Richardson’s most controversial decision has been to order polygraph tests for several thousand scientists and others in the nuclear weapons complex. Each will be asked four questions, starting with “Have you given secrets to a foreign power?” Richardson’s aides said the tests will act both as a deterrent and as an investigative tool.

But Habiger was jeered last week at Livermore when he tried to explain the policy to an auditorium of scientists. And most of the 300 nuclear weapon designers and other experts in the X Division at Los Alamos, where Lee worked for 18 years before he was fired in March, have signed a petition opposing the tests as unreliable and misleading.

Ed Curran, head of counterintelligence at Energy, is unrepentant.

“You know the program is working when you get the blowback, when you get the squealing and the whining,” he said. “They realize we’re serious. And we are.”