Spies, Lies & Portable Tapes

The feds were already suspicious of scientist Wen Ho Lee. Then they discovered hed downloaded every secret in the nuclear arsenal.

When Lee survived the cutbacks, he didn't pursue these opportunities. But Sylvia was not so lucky: She was involuntarily terminated in 1995 during another workforce reduction. According to an August 1999 joint statement by the Senate Governmental Affairs Committee, Sylvia Lee's personnel file contained incidents of alleged security violations and threats she had made against co-workers, but no details were provided on the nature of those violations or threats. (A civil lawsuit subsequently filed by the Lees against several federal agencies states that Sylvia had actually been recruited by the FBI to help monitor Chinese scientists. "Sylvia Lee never requested any payment from the FBI when she put herself and her husband at risk to help protect America's national security," the suit notes.)

In 1995, the year that Sylvia lost her job, the CIA received a classified Chinese report containing information about several U.S. thermonuclear weapons, including the W-88, a cone-shaped thermonuclear warhead launched from missiles carried aboard the Trident submarine. Some 4,000 to 5,000 of the W-88 warheads were to be manufactured at the Rocky Flats Nuclear Weapons Plant outside Denver, but production had been halted in 1989 after the FBI raided Rocky Flats. Although the CIA concluded that the person who'd leaked them the document was actually a Chinese agent, it nevertheless pulled together a group of experts from the Department of Energy and the weapons labs to analyze the data.

The DOE, which operates the nation's three nuclear-weapons labs, focused only on the W-88 warhead. Investigators concluded that information about the warhead had been passed to China sometime between 1984 and 1988 and that the person who provided the information probably worked at Los Alamos, where the weapon had been designed. Government officials then performed what's called a "matrix analysis." Three lists of people were compiled: scientists from Los Alamos who had access to the design information; scientists who had traveled to China between 1984 and 1988; and those who had contact with visiting Chinese delegations during that period. One major suspect popped up: Wen Ho Lee.

The spy next door? Wen Ho Lee heading into court last December.
The spy next door? Wen Ho Lee heading into court last December.
The spy next door? Wen Ho Lee heading into court last December.
The spy next door? Wen Ho Lee heading into court last December.

But that analysis was "seriously flawed," according to Vrooman, the former Los Alamos counterintelligence head, with not one shred of evidence linking Dr. Lee to the theft of the W-88. "The DOE investigators developed a long list of [Los Alamos] travelers, seventy names, which still turned out to be woefully incomplete," he said in another speech. "They reduced this to twelve suspects, with Lee as the only real candidate. I did not question why Lee was on this list, as he met the criteria, but I did question why several others were on the list. Three had no access, and one did not even have a clearance. The lead investigator told me that he was sure that Lee was the one, and only needed other names to fill up the list."

Vrooman, who, along with two others, was subsequently criticized by the DOE for failing to follow through on certain actions with regard to Lee, said the information obtained by the Chinese was also available on many classified documents distributed to hundreds of locations throughout the government and its complex of contractors. For example, one document containing a rather detailed description of the W-88 had 548 addresses on its distribution list.

Nonetheless, the DOE forwarded the results of the inquiry, dubbed "Kindred Spirit," to the FBI. The bureau opened its investigation in May 1996; after reviewing all of the material, the FBI concluded that it was indeed possible that Lee had passed information about the W-88 to China. But the supporting documentation, as Vrooman -- and later even Reno -- would note, was scanty: The evidence included Lee's involvement with the Livermore scientist in the early '80s, some software and calculations related to hydrodynamics that he'd purportedly supplied to the Chinese, and his work on nuclear-weapons source codes, which were of increasing interest to China since it had stopped actual testing. In addition, the Lees apparently had been treated well during their visits to China, and the FBI saw this as "standard PRC intelligence tradecraft" to encourage Chinese living abroad to visit ancestral villages and family members as a way of "trying to dilute loyalty and encouraging solidarity with the authorities in Beijing."

But the investigation into Wen Ho Lee soon got bogged down in a series of miscommunications and missteps involving Los Alamos, the DOE, the Department of Justice and the FBI. The bureaucratic bungling, as well as China's alleged espionage, would eventually become the subject of numerous congressional hearings. Even former Denver mayor Federico Peña would be dragged into the furor.

Peña, who had served as Secretary of the Department of Transportation during Bill Clinton's first term, was named Secretary of the Department of Energy at the start of Clinton's second term. He says he was flabbergasted when, in 1997, he heard allegations of espionage within the DOE. "The notion that espionage was occurring in our nuclear laboratories was shocking and disturbing," he recalls.

Upon learning of the allegations, Peña says he alerted key officials within the White House, the Department of Defense, the Central Intelligence Agency and the Office of the Attorney General. He also reorganized the intelligence-gathering functions within the Department of Energy, creating, in effect, a new office of intelligence and a new office of counterintelligence that reported directly to him. In addition, Peña says, he recruited Ed Curran, formerly with the FBI, to head up counterintelligence operations and doubled that budget.

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