@@ Inside the Israel espionage investigation @@
Arash
September 5, 2004
A Web Of Intrigue
Inside the Israel espionage investigation
By BRIAN BENNETT, ELAINE SHANNON & ADAM ZAGORIN
With reporting by Timothy J. Burger
It was a hot, late August afternoon when the Iraqi exile got a call on his
cell phone. Over the crackling line, the Iraqi says, the caller identified
himself as Larry Franklin, an analyst for the Defense Department in
Washington. Franklin rattled off a series of questions. He wanted to know if
the Iraqi, who had spent the past decade working with Ahmad Chalabi's Iraqi
National Congress (I.N.C.), could recall whether anyone at the I.N.C. had
discussed the U.S.'s ability to intercept and decode Iran's secret
communications. The Iraqi, who knew Franklin's name but had never met him,
was startled by the call. "How about discussing Iranian codes with a drunken
American? Had anyone ever done that?" Franklin wanted to know. For nearly
half an hour, Franklin quizzed him about Pentagon officials and Iranian
spycraft. "That was really scary," recalls the Iraqi. "I told him, 'I don't
remember anything.'"
That phone call, which the Iraqi described to TIME last week, seems to be an
indication that two complicated spy cases have become linked. Several weeks
ago, according to federal law-enforcement officials, Franklin, who had been
under investigation by the FBI for giving classified information to the
American Israel Public Affairs Committee (AIPAC), agreed to cooperate in a
probe into whether the pro-Israel group was passing sensitive U.S. secrets
to Israel.
Franklin's call to the ex-I.N.C. man, who has provided TIME with credible
information in the past, suggests that Franklin was also assisting the FBI
in a separate inquiry into how highly classified details of America's
ability to decode Iranian intelligence messages may have fallen into the
hands of Chalabi's organization and been passed on to Iran in February. A
U.S. law-enforcement official confirms that the Iraqi's account of the
conversation is consistent with the types of calls Franklin was making on
behalf of the FBI.
According to law-enforcement officials, Franklin began cooperating with the
FBI after agents first confronted him with evidence that he had given
classified material to AIPAC, one of Washington's most powerful lobbying
organizations. Israel and AIPAC have denied the spy allegations; neither the
Pentagon nor Franklin would comment. The law-enforcement officials say
Franklin was persuaded in recent weeks to make "pretext calls"-scripted
conversations monitored by FBI agents and designed to tease out
incriminating evidence about other suspects. It was within this time frame
that Franklin approached the ex-I.N.C. official who spoke to TIME.
The two investigations are among the most politically charged espionage
cases in years. Israel and the I.N.C. are longtime allies of the U.S.,
though the CIA has for years warned that Chalabi was not to be trusted.
Allegations of Israeli espionage have been a hot-button issue since American
naval intelligence analyst Jonathan Pollard was imprisoned for life in 1987
for passing U.S. military secrets to Israel. Ever since the Pollard affair,
Israel has publicly insisted it no longer spies on the U.S. "I can tell you
here very authoritatively, very categorically, Israel does not spy on the
United States," Israel's U.S. ambassador, Daniel Ayalon said last week. "We
do not gather information on our best friend and ally."
Federal law-enforcement officials say they remain on the lookout for signs
that Israelis still pursue U.S. secrets. A former congressional official
told TIME that in the 1990s Israelis in Washington were known to routinely
seek copies of classified documents such as secret portions of the annual
Javits report, a U.S. compilation on arms sales.
National Security Adviser Condoleezza Rice and her deputy Stephen Hadley
were informed of the FBI's probe into AIPAC at least two years ago,
according to a U.S. official. But that did not hinder numerous contacts
between AIPAC and top Administration officials as well as congressional
leaders of both parties. The lobbying group derives its power from its
backing among influential Jewish Americans. Just last May, President George
W. Bush attended AIPAC's annual conference in Washington and thanked the
organization for "serving the cause of America" and bringing to public
attention the threat of Iran's development of nuclear weapons.
At that time, the FBI was already deep into its investigation of AIPAC. A
former U.S. official interviewed by the FBI more than a year ago told TIME
that the bureau sought information on key AIPAC personnel, their meetings
with White House and other national-security officials in Washington and
even details about their personal lives. At one point, the FBI was
surveilling a meeting between an Israeli diplomat and an AIPAC official when
the Pentagon's Franklin suddenly appeared, igniting concerns. Franklin, a
former Air Force Reserve officer, served briefly in the U.S. military
attache's office in Israel in the late 1990s.
Since the summer of 2001, he has worked as an Iran expert for Douglas Feith,
the Pentagon's third ranking official, a neoconservative long in favor of
tougher measures against Iran.
In 2001 Franklin and a Pentagon colleague were dispatched to Rome for a
meeting with Manucher Ghorbanifar, an Iranian arms dealer who had been a key
figure in the 1980s' Iran-contra scandal. They were seeking intelligence on
Iran from him. But the CIA has long considered Ghorbanifar unreliable, and
the Bush Administration later cut off the contacts.
According to a former U.S. government source, the material Franklin passed
to AIPAC included a draft of a National Security Presidential Directive
dealing with U.S. policy on Iran. The document, a source says, had gone
through several versions without ever achieving the status of official U.S.
policy because of deep disagreements within the Administration over how to
cope with Iran.
A source familiar with multiple drafts of the document said it was a
"glorified Op-Ed looking at how engagement [with Iran] doesn't work and how
the U.S. needs a more robust strategy." A former senior U.S. official who
also saw the drafts told TIME the directive did not explicitly call for
regime change in Tehran and left open the possibility of cooperation with
the Iranians on matters of mutual interest.
Meanwhile, a former case officer at the Defense Intelligence Agency says
that when he was questioned in the I.N.C. case, the FBI seemed frustrated in
that investigation. That case officer, who worked alongside I.N.C.
intelligence gatherers at the time of the alleged breach, says he was
interrogated and polygraphed by the FBI. He contended to TIME that the
allegations against the I.N.C. are baseless and that the bureau is "grasping
at straws." U.S. intelligence and law-enforcement officials insist that U.S.
intercepts of Iranian communications prove that secrets about U.S.
code-breaking were gravely breached and that the only question is, Who is to
blame?
So far, no one, including Franklin, is known to have been charged in either
case.
In the meantime, AIPAC and its allies have launched a P.R. blitz, urging
backers to bolster the group by contacting members of Congress with
expressions of support.
Whatever happens in the case, many in the FBI believe their ability to get
to the bottom of the matter has been seriously compromised by the revelation
of Franklin's name and other details leaking out about the scandal. "We may
never know what really happened or how big and wide it was," says a bureau
official. Using Franklin to make more cold calls on the I.N.C. case isn't a
promising tactic either.
http://www.time.com/time/magazine/article/0,9171,1101040913-692835,00.html