Probes Espionage at White House
By J. Michael Waller <waller@insightmag.com>
and Paul M. Rodriguez <rodriguez@insightmag.com>
A foreign spy service appears to have penetrated secret
communications in
the Clinton administration, which has discounted security and
intelligence
threats.
The FBI is probing an explosive foreign-espionage operation that
could
dwarf the other spy scandals plaguing the U.S. government.
Insight has
learned that FBI counterintelligence is tracking a daring
operation to spy
on high-level U.S. officials by hacking into supposedly secure
telephone
networks. The espionage was facilitated, federal officials say,
by lax
telephone-security procedures at the White House, State
Department and
other high-level government offices and by a Justice Department
unwillingness to seek an indictment against a suspect.
The espionage operation may have serious ramifications because
the FBI has
identified Israel as the culprit. It risks undermining U.S.
public support
for the Jewish state at a time Israel is seeking billions of tax
dollars
for the return of land to Syria. It certainly will add to
perceptions that
the Clinton-Gore administration is not serious about national
security.
Most important, it could further erode international confidence
in the
ability of the United States to keep secrets and effectively
lead as the
world's only superpower.
More than two dozen U.S. intelligence, counterintelligence, law-
enforcement
and other officials have told Insight that the FBI believes
Israel has
intercepted telephone and modem communications on some of the
most
sensitive lines of the U.S. government on an ongoing basis. The
worst
penetrations are believed to be in the State Department. But
others say the
supposedly secure telephone systems in the White House, Defense
Department
and Justice Department may have been compromised as well.
The problem for FBI agents in the famed Division 5, however,
isn't just
what they have uncovered, which is substantial, but what they
don't yet
know, according to Insight's sources interviewed during a year-
long
investigation by the magazine. Of special concern is how to
confirm and
deal with the potentially sweeping espionage penetration of key
U.S.
government telecommunications systems allowing foreign
eavesdropping on
calls to and from the White House, the National Security
Council, or NSC,
the Pentagon and the State Department.
The directors of the FBI and the CIA have been kept informed of
the ongoing
counterintelligence operation, as have the president and top
officials at
the departments of Defense, State and Justice and the NSC.
A "heads up" has
been given to the House and Senate Intelligence Committees, but
no
government official would speak for the record.
"It's a huge security nightmare," says a senior U.S. official
familiar with =
the
super-secret counterintelligence operation. "The implications
are severe,"
confirms a second with direct knowledge. "We're not even sure we
know the
extent of it," says a third high-ranking intelligence
official. "All I can
tell you is that we think we know how it was done," this third
intelligence
executive tells Insight. "That alone is serious enough, but it's
the
unknown that has such deep consequences."
A senior government official who would go no further than to
admit
awareness of the FBI probe, says: "It is a politically sensitive
matter. I
can't comment on it beyond telling you that anything involving
Israel on
this particular matter is off-limits. It's that hot."
It is very hot indeed. For nearly a year, FBI agents had been
tracking an
Israeli
businessman working for a local phone company. The man's wife is
alleged to
be a Mossad officer under diplomatic cover at the Israeli
Embassy in
Washington. Mossad - the Israeli intelligence service - is known
to station
husband-and-wife teams abroad, but it was not known whether the
husband is
a full-fledged officer, an agent or something else. When federal
agents
made a search of his work area they found a list of the FBI's
most
sensitive telephone numbers, including the Bureau's "black"
lines used for
wiretapping. Some of the listed numbers were lines that FBI
counterintelligence used to keep track of the suspected Israeli
spy
operation. The hunted were tracking the
hunters.
"It was a shock," says an intelligence professional familiar
with the FBI
phone list.
"It called into question the entire operation. We had been
compromised. But
for how long?"
This discovery by Division 5 should have come as no surprise,
given what its
agents had been tracking for many months. But the FBI discovered
enough
information to make it believe that, somehow, the highest levels
of the
State Department were compromised, as well as the White House
and the NSC.
According to Insight's sources with direct knowledge, other
secure
government telephone systems and/or phones to which government
officials
called also appear to have been compromised.
The tip-off about these operations - the pursuit of which
sometimes has led
the FBI on some wild-goose chases - appears to have come from
the CIA, says
an Insight source. A local phone manager had become suspicious
in late 1996
or early 1997 about activities by a subcontractor working on
phone-billing
software and hardware designs for the CIA.
The subcontractor was employed by an Israeli-based company and
cleared for
such work. But suspicious behavior raised red flags. After a
fairly quick
review, the CIA handed the problem to the FBI for follow-up.
This was not
the first time the FBI had been asked to investigate such
matters and,
though it was politically explosive because it involved Israel,
Division 5
ran with the ball. "This is always a sensitive issue for the
Bureau," says
a former U.S. intelligence officer. "When it has anything to do
with
Israel, it's something you just never want to poke your nose
into. But this
one had too much potential to ignore because it involved a
potential
systemwide penetration."
Seasoned counterintelligence veterans are not surprised. "The
Israelis condu=
ct
intelligence as if they are at war. That's something we have to
realize,"
says David Major, a retired FBI supervisory special agent and
former
director of counterintelligence at the NSC. While the U.S.
approach to
intelligence is much more relaxed, says Major, the very
existence of Israel
is threatened and it regards itself as is in a permanent state
of war.
"There are a lot less handcuffs on intelligence for a nation
that sees
itself at war," Major observes, but "that doesn't excuse it from
our
perspective."
=46or years, U.S. intelligence chiefs have worried about moles
burrowed into
their agencies, but detecting them was fruitless. The activities
of Israeli
spy Jonathan Pollard were uncovered by accident, but there
remains
puzzlement to this day as to how he was able to ascertain which
documents
to search, how he did so on so many occasions without detection,
or how he
ever obtained the security clearances that opened the doors to
such
secrets. In all, it is suspected, Pollard turned over to his
Israeli
handlers about 500,000 documents, including photographs, names
and
locations of overseas agents.
"The damage was incredible," a current U.S. intelligence officer
tells
Insight. "We're still recovering from it."
Also there has been concern for years that a mole was operating
in the NSC
and, while not necessarily supplying highly secret materials to
foreign
agents, has been turning over precious details on meetings and
policy
briefings that are being used to track or otherwise monitor
government
activities.
The current hush-hush probe by the FBI, and what its agents
believe to be a
serious but amorphous security breach involving telephone and
modem lines
that are being monitored by Israeli agents, has even more serious
ramifications. "It has been an eye opener," says one high-
ranking U.S.
government official, shaking his head in horror as to the
potential level
and scope of penetration.
As for how this may have been done technologically, the FBI
believes it has
uncovered a means using telephone-company equipment at remote
sites to
track calls placed to or received from high-ranking government
officials,
possibly including the president himself, according to Insight's
top-level
sources. One of the methods suspected is use of a private
company that
provides record-keeping software and support services for major
telephone
utilities in the United States.
A local telephone company director of security Roger Kochman
tells Insight, =
"I
don't know anything about it, which would be highly unusual. I
am not
familiar with anything in that area."
U.S. officials believe that an Israeli penetration of that
telephone
utility in the
Washington area was coordinated with a penetration of agents
using another
telephone support-services company to target select telephone
lines.
Suspected penetration includes lines and systems at the White
House and
NSC, where it is believed that about four specific phones were
monitored -
either directly or through remote sites that may involve numbers
dialed
from the complex.
"[The FBI] uncovered what appears to be a sophisticated means to
listen in o=
n
conversations from remote telephone sites with capabilities of
providing
real-time audio feeds directly to Tel Aviv," says a U.S.
official familiar
with the FBI investigation. Details of how this could have been
pulled off
are highly guarded. However, a high-level U.S. intelligence
source tells
Insight: "The access had to be done in such a way as to evade our
countermeasures =8A That's what's most disconcerting."
Another senior U.S. intelligence source adds: "How long this has
been going
on is something we don't know. How many phones or telephone
systems we
don't know either, but the best guess is that it's no more than
24 at a
time =8A as far as we can tell."
And has President Clinton been briefed? "Yes, he has. After all,
he's had
meetings with his Israeli counterparts," says a senior U.S.
official with
direct knowledge. Whether the president or his national-security
aides,
including NSC chief Sandy Berger, have shared or communicated
U.S.
suspicions and alarm is unclear, as is the matter of any Israeli
response.
"This is the first I've heard of it," White House National
Security Council
spokesman Dave Stockwell tells Insight. "That doesn't mean it
doesn't exist
or that someone else doesn't know."
Despite elaborate precautions by the U.S. agencies involved, say
Insight's
sources, this alleged Israeli intelligence coup came down to the
weakest
link in the security chain: the human element. The technical key
appears to
be software designs for telephone billing records and support
equipment
required for interfacing with local telephone company hardware
installed in
some federal agencies. The FBI has deduced that it was this
sophisticated
computer-related equipment and software could provide real-time
audio
feeds. In fact, according to Insight's sources, the FBI believes
that at
least one
secure T-1 line routed to Tel Aviv has been used in the
suspected espionage.
The potential loss of U.S. secrets is incalculable. So is the
possibility
that senior U.S. officials could be blackmailed for indiscreet
telephone
talk. Many officials do not like to bother with using secure,
encrypted
phones and have classified discussions on open lines.
Which brings the story back to some obvious questions involving
the indiscre=
et
telephone conversations of the president himself. Were they
tapped, and, if
so did they involve national-security issues or just matters of
the flesh?
Monica Lewinsky told Kenneth Starr, as recounted in his report
to Congress,
that Lewinsky and Clinton devised cover stories should their
trysts be
uncovered and/or their phone-sex capers be overheard.
Specifically, she said that on March 29, 1997, she and Clinton
were huddled
in the Oval Office suite engaging in a sexual act. It was not
the first
time. But, according to Lewinsky as revealed under oath to the
investigators for the Office of Independent Counsel, it was
unusual because
of what the president told her. "He suspected that a foreign
embassy was
tapping his telephones, and he proposed cover stories," the
Starr report
says. "If ever questioned, she should say that the two of them
were just
friends. If anyone ever asked about their phone sex, she should
say that
they knew their calls were being monitored all along, and the
phone sex was
just a put on." In his own testimony before a federal grand
jury, Clinton
denied the incident. But later - much later - he admitted to
improper
behavior and was impeached but not
convicted. U.S. District Court Judge Susan Webber Wright found
him to have
obstructed justice. Curiously, Starr never informed Congress
whether the
Lewinsky tale was true. For that matter, according to Insight's
sources,
Starr never bothered to find out from appropriate agencies, such
as the FBI
or the CIA, whether the monitoring by a foreign government of the
president's conversations with Lewinsky occurred.
Insight has learned that House and Senate investigators did ask
questions ab=
out
these matters and in late 1998 were told directly by the FBI and
the CIA
(among others) that there was no truth to the Lewinsky claim of
foreign
tapping of White House phones. Moreover, Congress was told there
was no
investigation of any kind involving any foreign embassy or
foreign
government espionage in such areas.
But that was not true. In fact, the FBI and other U.S. agencies,
including t=
he
Pentagon, had been working furiously and painstakingly for well
over a year
on just such a secret probe, and fears were rampant of the
damage that
could ensue if the American public found out that even the
remotest
possibility existed that the president's phone conversations
could be
monitored and the president subject to foreign blackmail. To the
FBI agents
involved, that chance seemed less and less remote.
The FBI has become increasingly frustrated by both the pace of
its
investigation and its failure to gain Justice Department
cooperation to
seek an indictment of at least one individual suspected of
involvement in
the alleged Israeli telephone intercepts. National security is
being
invoked to cover an espionage outrage. But, as a high law-
enforcement
source says, "To bring this to trial would require we reveal our
methods of
operation, and we can't do that at this point - the FBI has not
made the
case strong enough." Moreover, says a senior U.S. policy
official with
knowledge of the case: "This is a hugely political issue, not
just a
law-enforcement matter."
'You've Got the Crown Jewels'
If spies wanted to penetrate the White House, a facility widely
considered
the most secure in the world, how might it be done? For that
matter, how
might any agency or department of government be penetrated by
spies?
"Actually, it's pretty easy if you know what you're doing," says
a retired
U.S. intelligence expert who has helped (along with other
government
sources) to guide Insight through the many and often complicated
pathways
of government security and counterespionage.
Access to designs, databases, "blueprints," memos, telephone
numbers, lists
of personnel and passwords all can be obtained. And from
surprising
sources. Several years ago this magazine was able to review from
a remote
site information on the supposedly secret and inaccessible White
House
Office Data Base, or WHODB (see "More Personal Secrets on File @
the White
House," July 15, 1996).
Despite the spending of additional millions to beef up security
when the Whi=
te
House installed a modern $30 million computerized telephone
system a few
years ago, communications security remains a big problem.
Whatever the
level of sophistication employed, there are soft underbellies
that raise
significant national-security problems. And potential for
espionage, such
as electronic intercepting of phone calls, is very great.
Calls to or from the White House dealing with classified
information are
supposed to be handled on secure lines, but it doesn't always
happen.
Sometimes, according to Insight's sources, despite the existence
of special
phones at the White House and elsewhere to handle such calls,
some don't
use them or only one side of the call does. An Insight editor
recently was
allowed for demonstration purposes to overhear a conversation
placed over
an unsecured line involving a "classified" topic.
Carelessness always has been a problem, but former and current
FBI special
agents say that under the Clinton administration the disregard
for security
has been epidemic. Many officials simply don't like the bother of
communicating on secure phones.
In another instance, Insight was provided access to virtually
every telephon=
e
number within the White House, including those used by outside
agencies with
employees in the complex, and even the types of computers used
and who uses
them. Just by way of illustration, this information allowed
direct access
to communications instruments located in the Oval Office, the
residence,
bathrooms and grounds.
With such information, according to security and intelligence
experts, a
hacker or spy could target individual telephone lines and write
software
codes enabling the conversations to be forwarded in real-time
for remote
recording and transcribing. The White House complex contains
approximately
5,800 voice, fax and modem lines.
"Having a phone number in and of itself will not necessarily
gain you
access for monitoring purposes," Insight was told by a senior
intelligence
official with regular contact at the White House. "The systems
are designed
to electronically mask routes and generate secure connections."
That said,
coupling a known phone number to routing sequences and trunk
lines would
pose a security risk, this official says.
Add to that detailed knowledge of computer codes used to move
call traffic
and your hacker or spy is in a very strong position. "That's why
we have so
many redundancies and security devices on the systems - so we
can tell if
someone is trying to hack in," says a current security official
at the
White House.
Shown a sampling of the hoard of data collected over just a few
months of
digging, the security official's face went flush: "How the hell
did you get
that! This is what we are supposed to guard against. This is not
supposed
to be public."
Indeed. Nor should the telephone numbers or locations of remote
sites or
trunk lines or other sundry telecommunications be accessible.
What's
surprising is that most of this specialized information reviewed
by Insight
is unclassified in its separate pieces. When you put it
together, the
solved puzzle is considered a national-security secret. And for
very good
reason.
Consider the following: Insight not only was provided secure
current phone
numbers to the most sensitive lines in the world, but it
discovered a
remote telephone site in the Washington area which plugs into
the White
House telecommunications system.
Given national-security concerns, Insight has been asked not to
divulge any
telephone number, location of high-security equipment, or
similar data not
directly necessary for this news story.
Concerning the remote telecommunications site, Insight
discovered not only i=
ts
location and access telephone numbers but other information,
including the
existence of a secret "back door" to the computer system that
had been left
open for upward of two years without anyone knowing about the
security
lapse. This back door, common to large computer systems, is used
for a
variety of services, including those involving technicians,
supervisors,
contractors and security officers to run diagnostic checks, make
repairs
and review system operations.
"This is more than just a technical blunder," says a well-placed
source
with detailed knowledge of White House security issues. "This is
a very
serious security failure with unimaginable consequences. Anyone
could have
accessed that [back door] and gotten into the entire White House
phone
system and obtained numbers and passwords that we never could
track," the
source said, echoing yet another source familiar with the issue.
Although it is not the responsibility of the Secret Service to
manage equipm=
ent
systems, the agency does provide substantial security controls
over
telecommunications and support service into or out of the White
House. In
fact, the Secret Service maintains its own electronic devices on
the phone
system to help protect against penetration. "That's what is so
troubling
about this," says a security expert with ties to the White
House. "There
are redundant systems to catch such errors and this was not
caught. It's
quite troubling.=8A It's not supposed to happen."
Insight asked a senior federal law-enforcement official with
knowledge of th=
e
suspected Israeli spying case about the open electronic door. "I
didn't
know about this incident. It certainly is something we should
have known
given the scope of what's at stake," the official says.
Then Insight raised the matter of obtaining phone numbers,
routing systems,
equipment sites, passwords and other data on the
telecommunications systems
used by the White House: How hard would it be for a foreign
intelligence
service to get this information? "Obviously not as hard as we
thought," a
senior government official said. "Now you understand what we're
facing and
why we are so concerned."
That's one reason, Insight is told, the White House phone system
is designed=
to
mask all outgoing calls to prevent outsiders from tracing back
into the
system to set up taps. However, knowing the numbers called
frequently by
the White House, foreign agents could set up listening devices
on those
lines to capture incoming or outgoing calls. Another way of
doing it,
according to security experts, is to get inside the White House
system.
And, though it's considered impossible, that's what they said
about getting
the phone numbers that the president uses in his office and
residence.
Like trash, information is everywhere - and often is overlooked
when trying =
to
tidy up a mess.
- PMR and JMW
'So What, It's Only Israel!'
There is a tendency in and out of government to minimize the
impact of Israe=
li
espionage against the United States because Israel is a friendly
country.
That overlooks the gravity of the espionage threat, says David
Major,
former director of counterintelligence programs at the National
Security
Council. "This 'don't worry about allied spying, it's okay'
attitude is
harmful," he warns. "The U.S. should expect that the rest of the
world is
bent on rooting out its national-security secrets and the
secrets that
could subject its leaders to blackmail." Minimizing or
excusing "friendly
spying," he argues, only discourages vigilance and encourages
more attacks
on U.S. national security. "I'm not outraged by nations that
find it in
their interests to collect intelligence but by our unwillingness
to
seriously pursue counterintelligence."
Major, now dean of the private Center for Counterintelligence
and Security
Studies, asks: "What price should Israel pay for this? My
predictions are
that there will be no impact whatsoever. Do we put our heads in
the sand or
do we take it as a wake-up call?"
Others observe that Israel has passed stolen U.S. secrets to
America's
adversaries. The government of Yitzhak Shamir reportedly
provided the
Soviet Union with valuable U.S. documents stolen by Israeli spy
Jonathan
Pollard. "It's the security equivalent of herpes," says a former
U.S.
antiterrorism official now at a pro-Israel think tank who
requested
anonymity. "Who gets it [beyond Israel] nobody knows.... Once we
let it
happen, the word gets out that 'you can get away with this.'"
- JMW
