Suspected Spy Faced Inquiry 15 Years Ago

WASHINGTON — Suspected Chinese nuclear spy Wen Ho Lee failed an FBI polygraph test in January 1984, indicating he was investigated for possible espionage at least 12 years earlier than previous accounts have suggested, members of Congress were told Wednesday.

The test sought to determine if the Los Alamos National Laboratory nuclear scientist had contact with foreign intelligence services or had inappropriately shared classified information. Lee, who passed a second FBI polygraph test soon after, was fired in March of this year for security violations.

Lee is now the only suspect in a dramatic FBI investigation, code-named Kindred Spirit and involving dozens of federal agents. The inquiry has confirmed Chinese espionage of U.S. nuclear warhead design secrets in the 1980s and may involve the compromise of highly classified computer programs and data from hundreds of underground nuclear tests and simulations.

But the explosive case also has exposed what Sen. Pete V. Domenici (R-N.M.) called a “tragedy of errors, lost files, omissions and bad judgment” by the FBI, the Department of Energy, the Justice Department and other arms of the U.S. government.

Domenici told the Senate Energy and Natural Resources Committee that the FBI never informed Lee’s supervisors at the New Mexico lab or the Energy Department, which runs the nation’s nuclear weapon labs, that Lee had initially failed their polygraph test.

The Energy Department’s regional office in Albuquerque only learned of the FBI investigation in 1989, during a standard five-year review of Lee’s top-secret “Q” clearance. It then transferred Lee’s personnel file to Energy Department headquarters in Washington.

“The file was lost within DOE headquarters,” Domenici said. He added that the Albuquerque office ultimately hired an outside contractor in 1992 to reconstruct the lost Lee file.

An Energy Department spokeswoman said she could not comment on the issue.

The FBI and Energy Department have said that Lee was identified in 1996 as the chief suspect in an investigation into how Beijing had acquired top-secret details about the shape and design of America’s most modern nuclear warhead.

Lee’s “Q” clearance at Los Alamos was not withdrawn until late last year, however. In another apparent mix-up, FBI Director Louis J. Freeh told Elizabeth Moler, then deputy secretary of Energy, in July 1997 that the FBI investigation would not be jeopardized if Lee’s security clearance were lifted or if he were transferred to a less sensitive job.

But that information was not passed on to officials at Los Alamos, lab Director John Browne testified Wednesday. Moler told a Senate Armed Services Committee hearing on April 12 that she believed Lee already had been removed from his job, that his access to classified data was limited and his travel curtailed.

Still seeking to ensnare Lee, the FBI then tried what it calls a “false flag” operation in mid-1998. Chinese-speaking FBI agents called the scientist and tried to lure him to a meeting by pretending to be Chinese spies. He rebuffed their offer, several officials have said.

Lee was fired two months ago after failing another FBI polygraph test that focused, in part, on whether he had passed classified data on nuclear warheads while attending scientific conferences in Beijing in 1986 and 1988.

Three weeks after he was fired, the FBI determined that Lee had used a large magnetic tape drive to improperly transfer nearly 2,000 classified computer files, containing computer programs and data derived from hundreds of underground nuclear weapon tests and simulations, into an internal lab computer network that is considered vulnerable to outsiders.

Lee was not among those in the lab who was supposed to know how to transfer the files, officials said. He tried to delete the files from his computer two days after he failed the polygraph test but before he was fired.

Several officials said Wednesday that the files were accessed at least once after they were moved, but it remains unclear whether anyone other than Lee was involved. “As far as they can tell, the files were never hacked into,” said an administration official.

The transfers began in 1983 and ended in 1995, when new lab computer regulations prevented such file transfers.

Los Alamos Director Browne said he could think of “no benign reason” for Lee, a senior computer scientist in the weapon division, to transfer the files.

Lee’s lawyer, Mark Holscher, declined to discuss Lee’s reasons for transferring the files. Lee has not been charged in the case.

The FBI first interviewed and administered a polygraph test to Lee in January 1984 as part of an investigation code-named Tiger Trap. In that case, Lee had telephoned a fellow Taiwanese-born scientist at the Livermore lab near San Francisco in late 1982 and was overheard on an FBI wiretap.

The Livermore scientist was under suspicion for passing classified data to China about America’s neutron bomb. The scientist was never charged or publicly identified. A U.S. intelligence official who has heard the wiretap said Lee’s comments were “suspicious” but not conclusive.

In the FBI polygraph, however, Lee’s answers indicated deception on seven questions dealing with his contact with foreign intelligence services and whether he had inappropriately shared classified information.

After he was given a chance to explain his answers to the FBI, he was retested, and passed. The FBI then put a “cleared” notice on the final page of the 18-page polygraph report. In the year between Lee’s call and the FBI interview, agents tried but failed to find other evidence linking the two scientists.

Atty. Gen. Janet Reno launched an internal inquiry Wednesday into the apparent breakdown of communication between the FBI and the Justice Department in the Lee case.

Justice Department lawyers rebuffed FBI requests to obtain a wire tap on Lee’s phone or a search warrant for his home. They also denied a 1996 effort to examine Lee’s office computer and warned that evidence obtained without proper permission would be inadmissible in court, according to Wednesday’s testimony. Lee’s home, office and computer were all searched after he was fired in March.

A Justice Department official said Reno intends to draw on lawyers from U.S. attorneys’ offices around the country and agents from FBI field offices “to review the matter.”