The Nuclear Jihadist

by Douglas Frantz

  Like others who had seen the intelligence coming out of Pakistan, Barlow recognized that there was no doubt about the country’s nuclear intentions. At the same time, he realized that a policy decision had been made at the highest levels not to stop the Pakistanis. Sifting through old files and examining new reports from field agents and diplomats in Europe and Pakistan, Barlow found that the CIA had penetrated the Pakistani nuclear establishment so thoroughly that it possessed the floor plans for A. Q. Khan’s giant enrichment complex at Kahuta. A former senior CIA officer who served in Pakistan during that period said the agency had cultivated a nuclear scientist with access to Kahuta and other installations that were part of the nuclear complex. On December 10, 1984, the CIA knew within hours that Khan had written a letter to President Zia boasting that he had enough weapons-grade uranium for at least one atomic device. The level of enrichment far exceeded the 5 percent “red line” established by President Reagan. In fact, a short time later the CIA estimated that Pakistan had enriched uranium to 93.5 percent, well into the weapons-grade realm.

  Barlow was astounded: His senior thesis, based mostly on publicly available information and the few tidbits he’d picked up elsewhere, was dead-on. While a graduate student at Georgetown in 1981, he had written a paper exploring the ideological basis for possessing a nuclear weapon within Islam. Eager to make his name and publicize his theory, he drafted a paper that combined his earlier research with classified material and sought permission to publish internally for government policymakers. His CIA supervisors turned him down, telling Barlow, “Your paper would be too insulting to our friends.”

  It was no time to insult the Pakistanis. The Reagan administration was pouring enormous resources into Afghanistan through Pakistan, a total that was to reach three billion dollars before the end of the covert war against the Soviets. While every CIA station chief in Islamabad since the middle 1970s had made it a priority to gather intelligence on Pakistan’s nuclear program, the main priority now was managing the war next door. Of the dozen or so CIA agents in the Pakistani capital in those days, only two were assigned to the nuclear portfolio. One was an attractive woman whose specialty was extracting critical information from male scientists.

  Still, the CIA penetration was so complete and its information was so good that in late 1984 the agency showed a scale model of the Pakistani bomb to the country’s foreign minister, Sahabzada Yaqub Khan, during a visit of his to Washington. The model had been built for the CIA’s office of scientific and weapons research, with help from scientists at the Livermore lab. “We knew more about that bomb than any other bomb in the world except the Brits’, which we helped build,” said a former senior CIA officer. “Our intelligence was absolutely solid. The point of showing them the model was to let them know that we were on top of it. There was never any doubt that they were going nuclear.”

  The two sides were playing a cat-and-mouse game: The Pakistanis knew their nuclear program had been compromised, but they recognized that they could proceed as long as Washington needed their help in Afghanistan. Yet the CIA remained determined to gather as much solid intelligence as possible, even though official policy was to deny the existence of a nuclear-weapons project in Pakistan.

  No one understood the gamesmanship better than Milt Bearden, a CIA veteran who replaced Howard Hart as Islamabad station chief. Bearden had joined the CIA in 1964 after serving in the U.S. Air Force, and he was part of a generation of spies who came of age in the shadow of the Cuban missile crisis. For those who rose through the ranks of the CIA in the last years of the Cold War, the war in Afghanistan was the supreme battle. William Casey, Reagan’s CIA director, had personally dispatched Bearden to Islamabad to oversee the massive escalation of American aid to the Arabs battling the Soviets. But his father had worked on the Manhattan Project, so Bearden also understood the basics of nuclear weapons and the danger they represented in the hands of a country like Pakistan.

  Not long after the demonstration with the model bomb in Washington, a delegation of senior American intelligence officials arrived in Islamabad, and Bearden took them to dinner with President Zia at the Army House in Rawalpindi, where Zia still maintained his headquarters. After the meal, as they were having tea, Zia told the Americans a story that he characterized as a fable. “There was a lonely woodsman walking through the woods one day not far from here, near a place called Kahuta. He was walking down a lonely road when he stopped by a stone and sat down. He was carrying an axe and decided that he would use the stone to sharpen the blade of his axe. But when the woodsman began to sharpen the blade, lo and behold, the stone began to crumble under the strokes of the axe. This was indeed surprising and so the woodsman took the stone to his village elders. They opened it and found that it was full of sensing equipment the likes of which had never been seen before in Pakistan. The woodsman’s friends sent the stone to their Chinese friends and the Chinese said, ‘This is very good stuff.’”

  Bearden loved the story and was determined not to show any surprise that one of his listening devices had been discovered. “After the Chinese are finished, if you give me the stone I will send it to Washington for examination,” he said, eliciting laughter.

  THE STORYTELLING could last only as long as the fiction was maintained that Pakistan wasn’t really working on a nuclear bomb. The truth needed to be concealed not just from the public but from Congress. So while the CIA reported the hard facts and intelligence back to successive administrations in Washington, the full story of Pakistan’s bomb efforts and its violations of American export law were kept from Congress for fear of provoking a cutoff in assistance to Pakistan that would jeopardize the effort in Afghanistan.

  On February 25, 1985, the truth emerged, if only for a brief moment in the sunshine. Seymour Hersh, an investigative reporter, wrote a front-page article in The New York Times exposing the connections between the krytron case and the Pakistani government. Hersh revealed that Vaid had possessed letters linking him to Siddique Butt and the Pakistani procurement effort and recounted how federal prosecutors had concealed the nature of the case. Justice Department officials denied the charge, and Pakistan’s ambassador in Washington claimed that his country was not pursuing the bomb. A State Department official told Hersh that he realized the case looked like a “grand fix,” but maintained that it was in fact mere bureaucratic bungling and miscommunication.

  Hersh’s revelation angered Stephen Solarz, a powerful Democratic congressman from New York and chairman of the House subcommittee with responsibility for India and Pakistan. The prospect of American goods fueling an arms race alarmed Solarz, and he set up a hearing before his subcommittee to explore the issue. Solarz appeared ready to start a fight aimed at cutting off aid to Pakistan, which was coming up for congressional renewal at the time. “A Pakistani agent had been caught illegally buying American technology and I took a dim view of Pakistan’s effort to get nuclear weapons,” Solarz said later. “A few people were arguing that it would be an Islamic bomb and that Pakistan would make it available to other countries. That seemed hyperbolic to me. I just thought it would be very destabilizing for the Subcontinent.”

  After lobbying by the CIA and some of his more moderate congressional colleagues, Solarz backed down. But he remained determined to impose tougher conditions, so he began crafting an amendment that would cut off assistance to any country caught trying to illegally import any type of American technology to enrich uranium or reprocess spent fuel into plutonium. He also proposed to cut off aid to Pakistan, should it detonate a nuclear device. At the same time, Senator Larry Pressler, a Republican from North Dakota, was drawing up a measure that would end American military and economic assistance to any country that possessed a nuclear weapon except for the five nations approved under the nonproliferation treaty. Like Solarz, Pressler was frustrated by what he saw as the failure of the administration and the intelligence community to tell the truth about Pakistan’s nuclear program. As a member of the Foreign Relations Committee, he ha
d received numerous classified briefings that downplayed Pakistan’s nuclear ambitions, a sharp contradiction with information in the press. “The briefings were as political as talking to the Democratic or Republican National Committee,” Pressler said. “We even mentioned Khan by name, and they said our information about his activities was all wrong. They would say, ‘We don’t believe reports by the BBC or New York Times are credible.’ It’s very hard for a congressman or senator to get at the truth of this. I said Pakistan was working on a nuclear bomb, and I kept getting the same answer from the CIA—‘No, I was wrong.’ ”

  Congress passed the Solarz and Pressler amendments, and they were signed into law on August 8. Shortly before final action in Congress, Solarz had agreed to tack on a provision that amounted to a giant loophole by giving the president the right to waive sanctions if he determined doing so was in the American national interest. Like earlier such legislation, the new laws had little impact. Reagan interpreted the possession of a nuclear explosive device in the most liberal and literal means, certifying each year that Pakistan had not violated American laws. “We knew they were almost completely finished with the bomb,” Bearden said. “All they had to do was turn a screw and paint B-O-M-B on the side.”

  In his colloquial manner, Bearden distilled the convoluted legal interpretation by State Department lawyers used to justify continued aid for Pakistan. In one key memo to the department’s chief legal adviser, government lawyers said the gap between possession and nonpossession was a narrow one, open to interpretation. “If a country has made a policy decision to halt development of its capabilities two days short of having everything in place to possess a nuclear explosive device, it would seem inappropriate to determine that they did not possess such a device,” said the memo. “If the country had decided to stop its development one year short of completion, it would seem inappropriate to determine that it did possess such a device.” The lawyers went even further, torturing legal logic enough to give Reagan an out if he certified that Pakistan did not possess a nuclear device yet was later proven wrong. Certification was not a guarantee of the truth, they said, and if the president acted in good faith, he was not breaking the law.

  NEAR the end of 1985, Rich Barlow was sitting in his office going through files when he came across a State Department cable mentioning that a California couple, Arnold and Rona Mandel, had exported dozens of high-speed cameras and oscilloscopes to Hong Kong. Barlow knew that the equipment was widely used in nuclear programs to calibrate the compression of explosives at a weapon’s core, so he began tracking the exports through various databases and CIA reports. Eventually, he found a CIA cable identifying the Hong Kong purchaser as a front company for Pakistan’s nuclear program. The transaction seemed to fit into a pattern that Barlow had been seeing in raw intelligence reports about Pakistan’s purchases and its nuclear progress, and he was eager to see how far he could follow the trail. Most CIA analysts would have filed the information internally, but Barlow sought permission to take the unusual step of sharing the information with the Justice Department and the Commerce Department. The prosecutors and export officials were surprised to be getting help from the CIA, but they grew enthusiastic as Barlow briefed them on the technology and the relationship between the purchaser and Pakistan’s nuclear agency, the PAEC.

  An enforcement agent at Customs had discovered that the Mandels had shipped $1.8 million in oscilloscopes and other nuclear-related technology to Pakistan via Hong Kong, but he had been unable to interest prosecutors in the case. Working with the agent, Barlow identified the implications of the shipments and linked them directly to Pakistan’s nuclear program. After he briefed senior prosecutors in California and Washington, a criminal investigation was started by the FBI. The Mandels did not have the required export licenses from the Commerce Department for the fifteen shipments; they had merely written Commerce Department license application numbers on various forms, and the banks and shippers had sent the goods on their way. Eventually, the Mandels pleaded guilty to felony charges and were sentenced to prison terms. Few noticed that the shipments had been financed by the Bank of Credit and Commerce International, a little-known financial institution with its headquarters in London.

  The successful investigation was a small but important step in breaking down the turf lines between agencies to develop a comprehensive, governmentwide strategy to combat proliferation. Barlow had demonstrated the potential effectiveness of interagency cooperation, and the result was the creation of a new group that brought together experts from the Justice Department, State Department, Customs Service, Energy Department, National Security Agency, and the CIA. It was called the Nuclear Export Violations Working Group, and Barlow was assigned to represent the CIA in it. It didn’t take long for the group to find enough information to conclude that roughly 90 percent of the nuclear technology being purchased illegally in the United States was going to Pakistan, sometimes directly and sometimes through an elaborate maze of front companies.

  The discovery led the group to undertake a coordinated effort to disrupt the Pakistani procurement network. When the State Department representative reported back to headquarters about the prospective campaign, alarm bells went off in the Near East and South Asia Affairs Bureau, which was responsible for relations with Pakistan and protective of the U.S.-Pakistan alliance. The big concern was that a barrage of criminal cases would trigger sanctions. The conflict between enforcing the law and disrupting diplomatic relations illustrated the inherent conflict that often found the State Department defending the suspect practices of foreign countries in order to maintain good ties and political influence. When it came to looking the other way on Pakistan’s nuclear-weapons development, the striped suits at Foggy Bottom had plenty of company from the Pentagon, the White House, and influential authorities at the CIA, including Bill Casey.

  Barlow felt like he had found his calling at the CIA, where he loved the challenge of deciphering the patterns of proliferation. He also recognized that the Reagan administration placed a higher priority on removing the Soviets from Afghanistan than on stopping Pakistan’s march toward the bomb and enforcing the law. He just wanted the administration to come clean with Congress and explain its reasoning. “The White House should have gone to Congress and said that you can’t have it both ways,” he said. “If you want us to continue the war with the Russians, then change the law. That’s how they started lying to Congress. They didn’t want to risk losing. Proliferation was a big issue, and with the Democrats in control of Congress the administration could have lost the argument and been forced to cut its ties with the Zia regime.”

  The working group was hobbled but not stopped, so that when another attempt by Pakistan to obtain restricted American technology surfaced near the end of 1986, Barlow found himself working again with other government agencies. This time, a Pakistani-born Canadian had contacted a Pennsylvania company about purchasing maraging steel. The telephone call set in play a series of moves that led Barlow into the heart of a major undercover operation.

  In December 1986, a man named Arshad Pervez had telephoned the international marketing manager for Carpenter Technology Corporation in Reading, Pennsylvania, saying he wanted to purchase twenty-five tons of specially strengthened maraging steel, which was used almost exclusively in nuclear facilities and was tightly controlled by U.S. export laws. The Carpenter sales manager, Albert Tomley, contacted the Department of Energy in Washington, which passed the tip on to Barlow, who informed the nuclear-export working group. The decision was made to set up another sting operation. With the steel company’s help, a customs agent would pose as a salesman; Barlow was tapped to provide the undercover agent, John New, with enough technical information to play his role convincingly.

  New spoke on the telephone with Pervez several times and met with him at restaurants and hotels in Toronto, where the Pakistani ran an import-export business. Pervez was surprisingly forthcoming, explaining that his client for the steel was a retired Pakistani ar
my general, Inam ul-Haq. Pervez offered several explanations for why ul-Haq wanted the extremely strong steel, saying at various times that they planned to use it in Pakistan’s space program or in the manufacture of high-speed turbines and compressors for commercial purposes. The explanations rang hollow with Barlow and his colleagues. The strength of the steel would allow Pakistan to produce rotors for the centrifuges with extremely thin walls, enabling them to spin with a speed and balance equivalent to flying a 747 ten feet off the ground. The quantity of steel signaled a major expansion of Pakistan’s enrichment plant. The American government had blocked an earlier attempt by Pakistani agents to buy a similar type of steel—obtaining enough to ramp up production of the more efficient centrifuges had emerged as a major choke point in Pakistan’s enrichment process.

  The mention of ul-Haq’s name had confirmed suspicions that the Pakistani government was involved in the purchase because the CIA had a thick file on the retired officer’s involvement with Khan’s procurement ring in Canada and Europe. “There is no doubt this stuff is going to Khan’s enrichment plant at Kahuta,” Barlow told the customs agents. “This is the clincher.”

  The investigators needed to catch Pervez and ul-Haq in the act, and they worried that the State Department might alert the Pakistani government if it learned of the undercover operation. Barlow and the customs agents met secretly with Fred McGoldrick, director of the State Department’s office for nuclear nonproliferation and chief of the working group, to express their concerns. He promised the investigation would remain confidential and that the State Department would not be informed until the last minute.

  The showdown with Pervez was set for June 9, 1987, in the bar of Toronto’s Harbour Castle Hotel, overlooking Lake Ontario. Pervez and New hunkered down at a table, sipping Johnnie Walker whiskeys and discussing the transaction. As the negotiations dragged on, they moved upstairs to New’s room to make the final arrangements for price and delivery dates. Pervez insisted that Carpenter inflate the price to give him a kickback of $45,180. When New pretended to balk, Pervez sweetened the deal, promising to order eleven more shipments of steel, worth about two million dollars. He said he also wanted to buy beryllium, a compound strictly controlled because of its uses in increasing the explosive power of fissile material in atomic bombs.