In 1990, I returned to SIB as chief and supervised approximately fifty unauthorized disclosure cases and personally interviewed scores of department officers who had leaked classified department information to the press or managed to lose custody of classified documents. I worked closely with the FBI to identify employees who had inadvertently or willfully provided classified information to a host of unauthorized recipients.
From 1992 to 1995, I served as a security officer at the American embassy in Paris and had the opportunity to establish the bone fides of a clandestine SVR officer, talk to a former Russian naval officer seeking US protection from the French intelligence services, identify two US-citizen Soviet penetration agents who were previously assigned to the embassy, help translate for the French police in its investigation of a US citizen who was the victim of a sexual assault, and assist the United States Secret Service’s protection for President Clinton on his visit to France to celebrate the fiftieth anniversary of the end of World War II.
In late 1996, I was offered the position of deputy director of the Division of Counterintelligence (DS/CI) with the department’s Bureau of Diplomatic Security. Highlights of my seven-year tenure included being intimately involved in the discovery of a Russian-placed listening device inside the State Department in 1999 and assisting the FBI in its investigation of Robert Philip Hanssen before his arrest in 2001. The division worked closely with colleagues in the CIA, DOD, FBI, and NSA to identify US government employees providing secret information to foreign intelligence services. In January 2002, as I prepared for my impending retirement slated for later that year, a personnel decision delayed the arrival of the new DS/CI director until late 2002. As a result, I gladly agreed to serve as the acting director for the interim nine months.
As September approached, I reminisced about the many intriguing criminal and security cases that humbled and baffled me over the previous twenty-eight years. I found it disappointing that DS’s fascinating history of successes and failures to safeguard government secrets remained largely unheralded and unknown to the public. Adding to my feelings were the numerous books and articles authored by retired government officials lauding their personal or agency’s contributions to historical events while largely overlooking or minimizing DS’s accomplishments. The seed was sown to write this book.
My retirement from the State Department was shortly followed by the Valerie Plame/“Scooter” Libby leak saga. Given the public debate, I felt qualified to offer my personal opinions on the subject and wrote an op-ed piece entitled “Full Disclosure on Leaks” that was printed in the October 22, 2003 edition of the New York Times. Fortunately my friends were generous in their reviews of the piece despite the fact I had openly moved to the enemy’s camp to make some points.
Less than a year after the op-ed article, the Justice Department announced that Donald W. Keyser, the State Department’s principal deputy assistant secretary of state for East Asian and Pacific affairs, had been detained by FBI special agents in the company of two Taiwanese clandestine intelligence officers. Coincidentally Keyser and I had been professional colleagues in the United States Liaison Office in Beijing from 1976 to 1977 and the US embassy in Tokyo from 1979 to 1980. Professional contact, though sparse, continued over the next twenty-five years. Keyser would soon face serious repercussions as a result of his relationships with these foreign intelligence agents. Then in 2004, the Bureau of Diplomatic Security brought me back two days a week as a consultant with the Division of Counterintelligence, where I reunited with my DS* and FBI colleagues. I would later play a pivotal role in a multiyear counterespionage investigation into a Cuban agent working for the State Department, arguably Fidel Castro’s most damaging US citizen spy.
My book doesn’t purport to be a comprehensive compilation of all State Department unauthorized disclosures or espionage cases. It’s obviously written from my experiences of the past thirty-five years working for the department. Naturally some of my own warts and bias have crept into the writing, but I’ve done my best to portray the incidents as accurately as possible.
Simply stated, the book is one insider’s account of State Department leaks, spies, and lies, the bureaucratic machinations that went along with them, and how they have adversely affected our national security. I hope you enjoy the read.
* During the time period covered by this book, the Russian intelligence service had two names, KGB (1954-1991) and SVR (1991-present). For consistency, I use the term “SVR” throughout the remaining text.
* The title for the security and law enforcement component of the State Department in 1917—the Security Intelligence Bureau—was changed in 1946 to the Office of Security. In 1985, by an act of Congress, the Bureau of Diplomatic Security (and within it the Diplomatic Security Service) was established as the successor to the Office of Security. For consistency, I use the term “DS” throughout the remaining text.
Part one
A Decidedly Cuban Connection
Yes, with a capital “Y,” was the answer given in English when asked in 2006 if Cuba would continue to send its spies to the United States.
—RICARDO ALARCÓN
president of Cuba’s National Assembly
If true, I can’t help but admire their [Kendall and Gwendolyn Myers] disinterested and courageous conduct on behalf of Cuba.
—FIDEL CASTRO
former president of the Republic of Cuba, June 6, 2009
Chapter One
He was arguably Fidel Castro’s most valuable spy within the State Department, operating undetected and with impunity for decades before we discovered him. We had been hunting him for years. Now he was about to escape.
The suspect, one Kendall Myers, had become suspicious and decided to retire from the department. Fearful that he was still being monitored by federal investigators in his retirement, Kendall and Gwendolyn, his wife and accomplice, completely divorced themselves from their clandestine life and devoted themselves to the pleasures of learning to sail their Swedish-made thirty-eight-foot Malmo sailboat complete with mahogany-lined living and sleeping quarters. The investigation by the FBI and DS had ground to a halt. By the early spring of 2009, after almost eighteen months of intensive, expensive, and exhaustive surveillance and with no obvious indications of espionage activities, the FBI decided there was nothing left to do but take a high-risk gamble.
After extensive consultation with the US Intelligence Community (IC), the FBI designed a bold, ingenious ploy: Kendall would be approached by an undercover FBI asset posing as a Cuban Foreign Intelligence Service (CuIS) agent. The meet would take place outside the Washington, DC, campus of the Johns Hopkins School of Advanced International Studies (SAIS) where he lectured.
On April 15, after much FBI preparation, IC trepidation, Justice Department hesitation, and DS exultation, the FBI undercover asset, codenamed “EK,” approached Kendall on his birthday as he prepared to teach a SAIS class. It was a quiet, drizzly evening on the urban campus. Kendall, a man in his early seventies who stood six feet six inches tall, bespectacled, with a receding white hairline and a moustache that draped over a constant smile, looked every bit the professor he was. After introducing himself to his target, EK offered Kendall a Cuban Cohiba cigar and said that a Cuban agent known to Kendall had “sent me to contact you” and “to get some information” because of the “change that is taking place in Cuba and the new [Obama] administration.”
EK suggested they meet in an hour at the Doubletree Hotel, located a few blocks away, to continue their conversation. To the collective delight of those of us listening in, Kendall not only agreed but also soon called Gwendolyn and excitedly told her that she had to drop everything and immediately come to the hotel for an important meeting. When she asked what was so important, he told her that she would soon find out.
An hour later, over a couple of beers in the hotel lounge, Kendall and EK casually talked about the new administration’s potential approach to Cuba and who might be the future South American policymakers.
Among other things, Kendall revealed espionage tradecraft and methods.
Kendall said, “We have nicknames. We never use real names, even the double names.” In response to EK’s questions about receiving messages in Morse code, he replied, “Yes, that’s right.”
Kendall said the last time that he and Gwendolyn visited Cuba was ten years before and added, “We’ve been meeting in third countries” (with CuIS agents) and that the last country was Mexico, “like three years ago, four years ago.”
When Gwendolyn spoke, she confirmed that she and Kendall still had the same shortwave Sony radio to receive messages and said, “You gave us the money to buy [the radio] a hundred years ago, and it still works beautifully . . . although I haven’t listened to it in a while.”
Those of us listening grew nervous at the following bits of ominous conversation. Kendall stated that “the problem with this country, there’s just too many North Americans,” and that “it would be nice” to travel to Cuba “in the near future” on their sailboat. He added that they “already have the charts . . . , the maps, and a cruising guide [GPS].” Kendall later said that it was his and Gwendolyn’s “idea to sail home.”
So home was Havana, not Washington, DC. Were they preparing for an expedited departure from the US? How soon? Along with the other investigators and prosecutors, I knew that all of our efforts depended on acting quickly, or Kendall and Gwendolyn Myers would slip away. We had to tie them convincingly to specific violations of federal espionage laws, including the unauthorized transmission of classified materials to a foreign agent.
And if we could not do it fast, the American couple who had compromised the US government’s diplomatic initiatives with Cuba for the last two decades, not to mention hundreds of millions of dollars’ worth of technical operations—the couple who were personally given medals for their work by Castro himself following a midnight dinner in Havana lasting over five hours—would indeed be sailing home.
It was 1999. The National Security Agency (NSA) code breakers pressed their headphones to their ears as they strained to isolate every sound transmitted from a radio site in Santiago, Cuba. The CuIS was attempting to relay a coded message to a prized penetration agent in Washington, DC. The female announcer, nicknamed “Havana Anna,” began the broadcast by calling out Atencion! Atencion!, followed by a series of 150 five-number groups the IC had dubbed the “Spanish Numbers.” The high-frequency shortwave transmissions were painstakingly recorded on state-of-the-art reel-to-reel tape recorders for analysis and, hopefully, deciphering.
Since 1991, the NSA had intercepted encrypted shortwave radio messages for agents “202” and “123,” including one on November 26, 1996, from the radio announcer with instructions to study the area of agent 123’s “new residence.” Previous NSA interceptions of similar Cuban radio transmissions had led to the FBI’s 2001 arrest and conviction of Defense Intelligence Agency (DIA) Cuban analyst Ana Montes for spying for the Castro government. When the “Spanish Numbers” transmissions continued after her arrest in 2001, the IC knew there was at least one more high-value Cuban penetration agent operating in the nation’s capital.
By the spring of 2007, FBI special agents assigned to the Cuba squad of the Washington Field Office (called WFO for short, pronounced Woof-O) were quietly voicing their frustration over the pace of the investigation. For years, the IC had supplied the FBI with fragmentary intelligence concerning suspected Cuban espionage. As tantalizing as the “Spanish Numbers” were, there simply was not enough identifying data to develop investigative leads, much less identify the penetration agent. The basic facts were extremely sparse—the adversary was Cuba, the target was probably Washington, DC, and the suspect was likely someone working inside one of the US government’s foreign affairs or intelligence agencies. It was not much to go on.
However, the IC knew that the CuIS’s preferred method of communicating with its penetration agents in the United States was via shortwave radio messages sent in Morse code or relayed by a voice reading a series of numbers. Beyond that sketchy piece of information, the federal investigators could not pinpoint the location of the receiving radio, much less the employer for whom “202” and “123” were working. To those of us working the case, it was a nightmare scenario.
Separately CIA analysts had been assessing defector and field information that strongly suggested the CuIS had managed to place a long-term and presumably high-value penetration agent in one of the US government’s foreign affairs or intelligence agencies. The CIA, NSA, and FBI Cuban specialists eventually agreed that the investigation should focus on the official biographies and personal histories of all foreign affairs personnel working in metropolitan Washington, DC. Unfortunately that number could easily exceed one hundred thousand individuals.
The IC had to consider the reality that the Cuban agent could be employed by any of the federal alphabet agencies such as the CIA, DIA, NSA, and NSC. Of course, the State Department would also be high on the list. But perhaps the suspected penetration agent worked for the Department of Commerce, Treasury, or Homeland Security, whose foreign affairs responsibilities might involve access to classified information about the Caribbean island nation.
While the IC compiled its enormous list of potential suspects, the FBI’s investigation was floundering. To complicate matters, NSA internal regulations prevented the FBI from sharing certain information gleaned from the “Spanish Numbers” transmissions with other federal investigators, including those assigned to the State Department’s Bureau of Diplomatic Security, Office of Counterintelligence (DS/CI).
DS special agents, as well as department employees, do not undergo polygraph examinations as a condition of employment, and as a result, DS/CI personnel were not authorized access to the raw intercepted data nor the IC’s analysis of the “Spanish Numbers.” The FBI had attempted a preliminary investigation of department employees as potential suspects; however, without DS/CI assistance and expertise, their results were highly limited.
Absent DS guidance, if left on their own to conduct further investigations of department employees, the FBI agents would be like a Humvee charging about in the proverbial china shop. And I say this with the greatest admiration and respect for my FBI colleagues.
The principal State Department building, affectionately known as “Main State,” “Mother State,” or “Foggy Bottom,” is situated in Washington, DC, on a site of land bordered by C Street on the south, D Street on the north, Twenty-First Street on the east, and Twenty-Third Street on the west. Three of the four streets are open to normal vehicular traffic of which two have metered parking. It was officially christened by law in 2000 as the Harry S. Truman building (HST). The primary or “diplomatic” entrance to the facility for employees and visitors is located at 2201 C Street. In 1957, Secretary of State Dulles helped lay the first cornerstone, and the building was completed in 1961. Housing over eight thousand employees in 1.5 million square feet of working space and a large underground parking area, the eight-story-tall building is the third largest federal building in the Washington metropolitan area. The building hosts some of the government’s most sensitive information and conversations. A foreign penetration agent with access to the building’s secrets would be a catastrophe for the department, the White House, and the IC.
The FBI case languished for five years, constrained by the IC’s internal regulations that restricted the dissemination of NSA material to certain elements of the IC. This administrative logjam was creatively overcome in 2007 by Special Agent Kate Alleman, the FBI’s liaison officer assigned to DS/CI. SA Alleman was a specialist in counterespionage work, admired by DS/CI special agents and analysts alike. She was also greatly respected for her tireless efforts as a mediator resolving counterintelligence turf disputes among the NSA, CIA, FBI, DS, and others. Privy to all the NSA and CIA Cuba information, she was aware that DS/CI was being fed limited information in order to protect sensitive sources and methods. She was intensely intelligent, attractive, and athletic—she bi
cycled to work every day, twenty-six miles round trip—and she had an infectious laugh. There was no one in the IC community I trusted more than Kate.
I had retired from the department in 2002. In 2003, I was contacted by the director of the Office of Investigations and Counterintelligence (DS/ICI/CI) and hired as a contractor to work again, three days a week, for DS/CI, where I had served as the deputy director during the six years prior to my retirement. I was appointed as an investigative specialist and provided with a baby-blue, photo-affixed set of credentials, inside a shiny black leather case that was embossed with the gold seal of the Department of State and stated, “This investigative specialist is commended as worthy of trust and confidence. The bearer is authorized to conduct official record reviews and inquiries for this department as directed by the authority of the Bureau of Diplomatic Security, United States Department of State.”
This authorization was slightly different from the one in my former special agent credentials, which stated, “This Special Agent is worthy of trust and confidence. The bearer is authorized to carry firearms, make arrests, conduct official investigations for this department, and to protect the Secretary of State, foreign dignitaries, and other persons under the authority of the United States Code.”
My new responsibilities allowed me to avoid any involvement in budget, administrative, resource, management, or policy deliberations, which comprised more than 50 percent of my work when I was the office’s deputy director. My sole job now was to assist the DS/CI agents and concentrate on the office’s counterintelligence and counterespionage investigations. I sat in on interviews, conducted interviews, briefed the IC on the status of inquiries, taught State-specific espionage cases to the IC, searched for old records, provided security briefings to federal employees traveling to sensitive countries overseas, and even edited the final reports of investigations—nothing was too small for me.
State Department Counterintelligence: Leaks, Spies, and Lies Page 2
