State Department Counterintelligence: Leaks, Spies, and Lies

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State Department Counterintelligence: Leaks, Spies, and Lies Page 11

by Robert David Booth


  On January 18, 2006, during his initial debriefing, Keyser admitted knowing that Cheng was an NSB intelligence officer yet his personal interpretation of the State Department rules did not require him to submit a contact report to DS or HR.

  DS/CI maintains an electronic database of all the foreign contact reports submitted by department officers. A quick search of the database revealed that between 2000–2002, Keyser had not submitted a single report concerning any contact with any TECRO official. DS depends on each individual department employee to recognize potential or real counterintelligence threats and alert DS/CI so it can devise appropriate countermeasures as necessary.

  Keyser had received several security awareness briefings during his diplomatic career and was cognizant of the modus operandi of Asian intelligence services. The DS/CI agents concluded that while Keyser might be in technical violation of department regulations by not reporting his contacts with two members of a foreign intelligence service, he might have valid foreign policy reasons for meeting with them, and therefore, he decided that he did not have to report to DS/CI.

  Keyser maintained a number of professional contacts with other foreign diplomats and clandestine intelligence officers masquerading as diplomats or foreign journalists based in Washington. For example, Keyser had a professional relationship with Bertrand Lortholary, the French embassy’s Political Counselor assigned to Washington, DC. In July 2003, among his many duties, Monsieur Lortholary was responsible for monitoring US–Chinese issues and forwarding his analysis to the Ministry of Foreign Affairs in Paris. At the time, Keyser was EAP PDAS, and given his US government influence and knowledge of Asian issues, he would have been a State Department insider the French embassy would want to cultivate.

  On July 2, 2003, the French embassy sent a fax requesting a courtesy visit to the department so that Messrs. Lortholary and Keyser could discuss matters of mutual interest. It would be difficult to imagine that the two didn’t share some bits of sensitive information during their first meeting. Did Keyser have to submit a contact report to DS following his meeting with Lortholary? Only if Lortholary’s behavior at the proposed meeting had triggered DS’s mandated reporting requirements for Keyser. Did Keyser have to submit a contact report for his meetings with Cheng? Only if he believed she represented a hostile intelligence threat. According to our counterintelligence database, Keyser did not think so because he had submitted no contact reports.

  Like Keyser, Frederick Christopher Hamilton, a young Defense Department employee, had pronounced opinions about what categories of classified US government information could be shared with a foreign government, despite signing a secrecy agreement to the contrary. Hamilton had been assigned as a research technician to the American embassy in Lima, Peru, in the Defense Attaché Office (DAO) from 1989 to 1991. He was a civil service employee working for the DIA. In 1986, prior to his posting to Lima, he wrote a paper entitled an “Analyst’s Guide to Foreign Disclosure” in which he advocated the not-so-novel idea that the US government should provide classified information to a foreign government if the United States knew that country “A” was about to attack country “B” and both countries were American allies. His central theme called for reducing military tensions and avoiding diplomatic wrangling by selectively sharing our intelligence with others. Years later, Hamilton would put into practice what he preached.

  Hamilton met his foreign military counterparts at social events, and some of his closest contacts included those assigned to the Ecuadorian embassy in Lima. Toward the end of his tour, classified reports began to filter into the DAO’s office that the long simmering border dispute between Ecuador and Peru might erupt into a serious conflict. Despite public pronouncements by both sides suggesting that conflict was inevitable, the US military’s intelligence indicated that neither side was gearing up for war. Hamilton believed that if his Ecuadorian military contacts in Lima had access to the DAO information and passed that data to their generals in Quito, the cross-border tensions could be reduced.

  So, undeterred by his oath of office, Hamilton provided several classified Intelligence and Information Reports (IIRs) on February 13 and May 20, 1991, to the Ecuadorian military attachés. The IIRs detailed the military capabilities of the Peruvian Armed Forces, US intelligence operations, and US sources in the region. The same classified IIRs allowed the Ecuadorian Ministry of Defense to determine if the Peruvian soldiers were truly combat ready or whether the calls to military action were merely saber rattling intended for public consumption. The IIRs concluded that despite pubic rhetoric to the contrary, Peru was not gearing up for a border clash with Ecuador and that any movements by the Peruvian armed forces were defensive in nature.

  Hamilton’s misdeeds were uncovered the following year, and he eventually pleaded guilty to two counts of unlawful communication of classified information to a foreign country. On April 16, 1993, he was sentenced to thirty-seven months in federal prison.

  US diplomats sharing information with foreign diplomats was certainly nothing new; however, the FBI and DS agents needed to determine if Keyser was sharing classified information in an unauthorized fashion with his TECRO contacts. Following months of surveillance, DS/CI and the FBI fully agreed that the developing Keyser–Cheng relationship deserved their closest attention. It was apparent from the beginning that they enjoyed both a professional and social relationship. Quickly the FBI and DS were authorized to conduct both human and technical coverage of Keyser’s comings and goings.

  At this point, after being informed of the investigation, I decided to alert the FBI and DS special agents of certain aspects of Keyser’s background as well as the history of the MSS’s targeting of foreign diplomats.

  Just prior to Keyser’s arrival in Beijing in 1976, Christopher Henry Ballou, USLO’s liaison officer, told me the story of how in the early spring of 1965, Keyser explained to his wife Beverly that he needed to leave Baltimore to pursue his graduate studies in Sino-Soviet relations at George Washington University (GWU), a one-hour drive away. Once comfortably situated in Washington, he pursued graduate studies with a focus on Russian affairs and language studies. One unpublicized fact about his move from Baltimore was his undeclared employment with the CIA. While his employment status was not for public consumption, his affections for Virginia Lee May—a young, single, and attractive woman with dark, wavy hair and penetrating eyes he met on the GWU campus—was similarly “close hold” information.

  In early 1966, while on a short visit home to Baltimore, Keyser told his wife that he had to travel to California on a secret mission for the CIA for an unspecified period of time. Fully supportive of her husband’s career, she wished him great success on his assignment. With his wife’s blessing, Keyser moved to San Francisco in July 1966, where he rented an apartment that he shared with May, took Chinese language courses at a local state college, and worked part-time for a maritime agency located on Mission Street.

  Not only had Keyser forsaken his wife; he had also abandoned his employment with the CIA, which was unaware of his purported secret California mission. After several months of complete silence, Mrs. Keyser telephoned the CIA through a special number to inquire as to how long her husband would remain incommunicado in California. The CIA’s immediate response to Mrs. Keyser was that it was also attempting to locate him.

  Mrs. Keyser hired Robert Bruce Tora, a private detective, to find her husband and report back to her. Tora managed to locate the shared apartment. He monitored the activities and eventually provided her with a full report. Mrs. Keyser wasted little time initiating divorce proceedings, and Keyser didn’t bother to contest his wife’s claims of adultery and desertion. Keyser’s first marriage ended in Baltimore County Court on July 15, 1968. Fourteen days following the divorce decree, Donald Willis Keyser and Virginia Lee May married in San Rafael, California.

  Keyser’s USLO assignment in Beijing was marred by a similar sexual indiscretion. Months after I left Beijing for Geneva in 1977, Brent Jones, my Australian
embassy security counterpart and former apartment neighbor, sent me a letter from the PRC telling me that the diplomatic community was all abuzz with gossip that Keyser had been involved in a long-term dalliance with a young female and that US Ambassador Leonard Woodcock had been informed of the affair by Keyser himself.

  While extra-marital affairs and sexual indiscretions were not uncommon among the diplomatic community in Beijing during the mid to late 70s, the question on my mind was why Keyser felt compelled to inform the ambassador and apparently his wife of his sexual peccadillo. Fear of getting caught by his wife or colleagues, or something worse?

  All foreign diplomats working in Beijing resided in apartments under the strict control of the Chinese government, except the Russians, who lived on an exclusive compound co-located with their embassy. Armed members of the People’s Liberation Army controlled entrances and exits to the “diplomatic ghettos,” and all USLO officers assumed that the Chinese-operated apartments were equipped with the latest electronic surveillance and bugging gear.

  If Keyser had been so indiscreet as to meet his paramour inside one of the diplomatic apartments, or worse, the Beijing Hotel, then the Chinese domestic security service, called the General Investigations Bureau (GIB) was aware of his activities. With film in hand, the GIB would have approached Keyser and attempted to blackmail him. The success of the GIB’s blackmail attempt would depend exclusively on Keyser’s desire to conceal the alleged affair from his wife and the department. In this scenario, the only way for Keyser to defuse the blackmail time bomb was to confess his sins.

  The department was sufficiently alarmed by Keyser’s “marital problems” that on June 5, 1978, DASS Victor Dikeos sent SY Channel telegram number 141355 to Ambassador Woodcock outlining counterintelligence concerns about Keyser. If Keyser was worried about the GIB, his fears were not unfounded. Future counterintelligence events in the PRC would reveal that the Chinese intelligence services closely monitor married diplomats.

  The Chinese Ministry of State Security (MSS), the GIB’s successor, attempted to blackmail Paul Doumitt, a married, forty-five-year-old US embassy communications officer assigned to Beijing in October 1988. While Doumitt’s wife remained in France to take care of her ailing mother, he engaged in a long-term intimate affair with a twenty-three-year-old Chinese shopkeeper named Liu “Jane” Jie. As the United Press International (UPI) reported in a dispatch dated November 11, 1988, “An unidentified American who works in the communications section (in Beijing) was the target of a MSS sex entrapment/blackmail attempt.” Doumitt was confronted by the MSS in a hotel room across the street from Jane’s apartment. He was told that unless he provided the identities of intelligence officers assigned to the embassy, both his wife and the US ambassador would receive graphic evidence of his infidelity. Doumitt declined to provide the MSS with the identity of any actual covert officer, choosing instead to suggest that DS agents assigned to the Beijing embassy as regional security officers (RSOs) “might be” intelligence officers. Returning to the US embassy, Doumitt tearfully told the RSOs of his indiscretions.

  After a midnight telephone call to Washington, Ambassador Winston Lord swiftly removed Doumitt from China just ahead of the UPI story. In 1994, Doumitt was assigned to the US embassy in Paris where I was working in the security office. Over time, he provided me with some of the details of the MSS blackmail attempt.

  In 2004, the MSS similarly attempted to blackmail a married Japanese diplomat assigned to the Japanese Consulate in Shanghai, whose wife remained in Japan, after he was caught in an adulterous relationship with a Chinese hostess working in a karaoke bar. The MSS demanded that the Japanese diplomat, a communications officer just like Doumitt, provide them with the Japanese diplomatic codes. The conclusion of this MSS blackmail attempt was entirely different from that of Doumitt. The Japanese diplomat returned to his office, wrote letters of apology to his wife and supervisor, and promptly hanged himself inside the consulate. Undeterred, in 2005 the MSS would again attempt to blackmail a married State Department officer traveling outside Beijing after the officer had engaged in sexual relations with a masseuse. Returning home, the officer reported the MSS blackmail attempt to the embassy security officer, and the ambassador ordered his immediate return to the United States. Blackmailing unfaithful married diplomats has been a tool of foreign intelligence services for over a hundred years and, in an attempt to mitigate this vulnerability, DS provides routine and regular security awareness briefings to all FSOs to sensitize them to this danger. Keyser attended many such briefings both in Washington and while serving overseas.

  As Keyser was packing up his household effects in preparation for his upcoming assignment to Tokyo, Mrs. Virginia Keyser filed for divorce, charging adultery. Keyser countered with a cross-complaint alleging irreconcilable differences. The presiding judge granted a no-fault divorce on December 13, 1985, on the grounds that they had intentionally lived apart without relations for more than one year. Custody of their twelve-year-old son, Gregory, was given to Mrs. Keyser. On February 22, 1986, Keyser married Margaret “Peggy” Lyons, a reserved, petite, and elegant CIA officer.

  SA Kevin Warrener was the agent identified by DS/CI to be the FBI’s go-to person in this investigation, and he was instructed that he was not to discuss the matter further with his colleagues. That would shortly change when Kevin was tasked to travel to Baghdad to conduct a number of counterintelligence inquiries and there was no one left in his division except for a brand new agent by the name of Giovanna Cavalier.

  A native New Yorker who in 2003 received a master’s degree from Georgetown University’s security studies program with a focus on counterintelligence, she graduated from basic agent training shortly before being assigned to DS/CI. Kevin had no choice but to hand over the investigation to her. Just before Kevin’s departure for Baghdad, he and Giovanna met with their FBI counterparts to determine the best way to monitor Keyser technically. They wanted to see what information Keyser was communicating to foreign contacts and contrast that with what he might be sharing with Cheng.

  Fortunately for the investigating team, Keyser used his office unclassified e-mail system to communicate with Cheng. That allowed the FBI and DS to review his personal messages to his TECRO contact. Whenever an employee logs onto the department’s computer system, linked to the Internet, a banner immediately appears advising all users that the system is being monitored by the department’s information technology and security staff. The warning is displayed more for reasons of preventing access to porn than finding evidence of espionage. DS agents began monitoring Keyser’s e-mail use and discovered that he liked to message Cheng. By the end of September 2004, he was sending her an average of five e-mails a day.

  On October 23 and 26, 2002, Keyser sent lengthy e-mails to Cheng detailing his assistance with the translations and conversations between President George Bush and Chinese president Jiang Zemin during the latter’s trip to Crawford, Texas. Keyser was able to describe in detail Zemin’s views on HIV/AIDS issues, intelligence cooperation, religion, the World Trade Organization, cross-strait relations, and Vice President Hu Jintao’s response to Vice President Cheney’s invitation to visit the United States. Not only did he report on the meeting, but he also added his critical analysis—a bonus for Cheng and the NSB.

  On November 22, 2002, Keyser sent an e-mail to Cheng analyzing press reports that she had sent him regarding the assumption by President Jaing Zemin of additional national security responsibilities. Keyser’s analysis benefitted from his access and knowledge of highly sensitive US government information. Keyser knew his prior conversations with Cheng were being reported to the NSB in Taipei and shared with senior Taiwanese officials. Following a luncheon engagement on March 6, 2003, Keyser sent an e-mail to Cheng stating the following:

  “Knowing that you are obligated to write up these lunchtime conversations, I tried not to say too much so as to spare you excessive labors. But I hope I didn’t say too little and therefore cause you and Mr. Huang
to wonder what on earth we were all doing there except exchanging stories and consuming an excellent international meal. I’m sure that NSB will begin to have questions if it appears that good taxpayer money [Taiwanese] is going to excellent meals in nice restaurants that produce nothing of reporting interest.”

  In this e-mail Keyser acknowledged that Cheng had to prepare contact reports per NSB internal regulations while at the same time he interpreted department regulations to mean that he did not.

  On March 16, 2003, Keyser e-mailed Cheng: “[I hope] I haven’t inundated you. I think I’ve sent you the key items, at least as I read the developing news. I’ll stop sending now so that you can ‘digest’ and write whatever you need to write. My yinmou guiji, of course, is to keep you as well informed as possible so that your people in Taipei consider you to be the indispensable officer in Washington. . . .”

  Keyser’s inadvertent admissions in this e-mail were particularly telling. The “developing news” he’d read, analyzed, and forwarded to his NSB contact could not have been data already available to the NSB. As Keyser correctly pointed out in his March 6 e-mail to Cheng, why would the NSB continue to pay for excellent cuisine only to obtain information of little reporting interest if it wasn’t getting something more substantive from Keyser?

  Keyser later claimed that the information provided to his NSB contacts was culled from the internet and included data from think tanks and academic institutions—in other words, from public sources. While the information may not have been classified, all Tier-1 foreign intelligence agencies (UK, Israel, Russia, PRC, etc.) spend considerable financial and human resources to locate, review, and analyze public information for inclusion in both their classified and unclassified reports. Most honest analysts will tell you that 95 percent of the data they use to produce classified reports already exists in the public domain and another 4 percent comes from electronic intercepts and what is referred to in the trade as “overhead imagery.” The other 1 percent comes from human sources—the least reliable. If Keyser, a respected specialist in Asian issues, identified a specific public document that the NSB should consider, he did so based on his personal expertise and analysis of classified government intercepts and imagery, something not readily available to the NSB. His stamp of approval on certain think tank and academic institution positions was tantamount to certifying their validity. Few other department officials possessed his experience and gravitas when it came to understanding Asian current events.

 

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