STATEMENT OF SENATOR JOE LIEBERMAN
RELEASE OF JOINT STATEMENT ON ESPIONAGE INVESTIGATION 
AUGUST 5, 1999

The closed hearings on which Senator Thompson and I based the Statement we are releasing today were extremely troubling. And what made them so troubling was not just the testimony that some of our most critical nuclear secrets appear to have been lost through espionage to the People's Republic of China. That was bad enough, but when our government suspects espionage, we have a right to expect that investigative and law enforcement agencies will vigorously pursue those suspected, and that they will do so with a high degree of thoroughness, competency, and urgency. Unfortunately, as we discovered during our hearings, there was a shocking lack of thoroughness, competency and urgency in the government's investigation of this very important case. 

MATRIX/FAILURE TO LOOK OUTSIDE OF LOS ALAMOS

Senator Thompson has already laid out the story, so let me just touch on some aspects that were most unsettling to me. The investigation was flawed from the start, when the Energy Department and the FBI made their first investigative decisions after learning that the PRC might have stolen information on the W-88 nuclear warhead. At the time, neither agency had any direct information linking any particular individual to the suspected espionage. So they did what is called a "matrix" analysis - that is, they tried to come up with the characteristics the person who gave the information to the PRC would likely have had, and then they set out to locate the universe of individuals who shared those characteristics. In this case, they used three characteristics to form their matrix: first, individuals at Los Alamos with access to the design information in question; second, Los Alamos employees who traveled to China during the 1984-1988 time period during which the Chinese apparently obtained the information; and third, Los Alamos employees who had contact with Chinese delegations visiting the labs.  There was a significant problem with this matrix, though: It assumed that the W-88 information was available only at Los Alamos, and therefore that the person responsible worked at Los Alamos. As we learned during our hearing, and as the President's Foreign Intelligence Advisory Board concluded in its recent review of the DOE labs, this was wrong. The fact is that the W-88 information was available beyond just Los Alamos, at numerous government and military entities since at least 1983. But, for reasons never explained to us, individuals at those facilities were not considered in that first critical matrix analysis -- and apparently may not have been looked at to this day. So, from its very conception, this investigation ignored 
an entire group of individuals who may have been responsible for the W-88 loss.

WAIVERS

When this matrix analysis was done at Los Alamos, the FBI and the Energy Department came up with a handful of individuals who met their three criteria, and ended up focusing in on two who were on the list:  Wen-Ho Lee and his wife Sylvia Lee. Then, we have one of the most astounding events of this investigation: the inexplicable failure of DOE and FBI investigators to figure out whether Dr. Lee had signed a waiver allowing access to his office computer, and the equally unfathomable subsequent failure to obtain a waiver from him -- which, because DOE was in the process of obtaining waivers from different sections of the lab, it could have done without alerting him to the investigation. I urge you all to read the details of this event - they are disheartening.

DELAYS

Considering the significance of the subject of the espionage in this case, the slow, casual pace of the investigation is infuriating. I offer two examples. First, in November 1996, the FBI decided that it wanted to access Dr. Lee's computer, but it did not seek a FISA warrant to achieve that access until April 1997, six months later; then, after OIPR told the FBI in August 1997 that there was not sufficient evidence to find probable cause and suggested ways in which that evidence might be gathered, the FBI did not return to OIPR for almost a year and a half.  Second, in August 1997, FBI Director Freeh told senior DOE officials that there was no longer any investigative reason to keep Dr. Lee in his current position, but DOE did not remove his access to classified information until December 1998 - almost a year and a half later.  We heard nothing during our hearings to justify these inexplicable delays.

FISA/PROBABLE CAUSE

Regarding the Department of Justice's denial in August 1997 of the FBI's request to pursue a surveillance warrant under FISA, I conclude that the attorneys at OIPR reviewed all the evidence before them and made a judgment call. It is one with which I ultimately disagreed, but it was, in my opinion, thoroughly defensible under the standards established by the Foreign Intelligence Surveillance Act.  In evaluating the FBI's request for the surveillance warrant of Dr. Lee, the OIPR saw no direct evidence that Dr. Lee was responsible for the loss of the W-88 design information; in other words, no witnesses or documents directly connected him to that act. I believe there is no disagreement with that conclusion. The FBI came to focus on Dr. Lee because he met their matrix criteria, and investigation of him revealed a number of suspicious acts. But, in OIPR's view, that circumstantial evidence, even when taken together, was not enough to meet the probable cause standard in FISA - that is, to show that it was more likely than not that Dr. Lee was, in the words of the statute "knowingly engag[ing] in clandestine intelligence gathering activities for or on behalf of a foreign power." That weakness of the evidence was increased, in OIPR's view, because there were a number of other employees at Los Alamos who shared the criteria that brought the Lees to the FBI's attention in the first place under the FBI's matrix analysis, but who were not pursued. So, OIPR told the FBI that it should go back and do the same type of investigation it did on the Lees on some of the others - that is, to go back and see if the others too had events in their past that made them likely suspects.  

Unfortunately, the FBI did not, in either 1997 or 1998, do what OIPR asked it to do. I do not understand why. If they had, they either would have discovered harmful evidence on the other individuals, diminishing the probable cause case against the Lees, or they would have discovered that no harmful evidence on the others, and 
that presumably would have confirmed their argument that the Lees were the most likely suspects, leading the OIPR to agree to pursue a search warrant of the Lees.

Regarding OIPR's conduct, I do, though, ask why, given the extreme importance of this case to America's national security, OIPR did not raise this issue to the Attorney General herself, push the FBI harder to make its case, or decide to send the request for a warrant to the FISA court to make the final judgment. I also come away from this investigation with the conclusion that it is worth reexamining the FISA statute to determine whether it needs to be amended to take into account cases like this - where the huge significance of the case may justify the application of a lower standard for obtaining a warrant than probable cause.

CONCLUSIONS/CONSEQUENCES

The bottom line is that the US government's investigation into the loss of the W-88 nuclear warhead design information was not a comedy of errors, but a tragedy of errors. And unfortunately, it is a tragedy with very serious and continuing consequences. If, on the one hand, the failure to more competently investigate this case means 
that we have wrongly focused on Dr. Lee, then the person or persons who actually passed the W-88 information to the PRC are still out there -- indeed probably still working for the US government in jobs with access to the most highly classified information our government possesses.

If, on the other hand, Dr. Lee is the person responsible, then the delays and mistakes in the investigation mean that a PRC agent was allowed to stay in a job that gave him continued access to highly classified nuclear weapons information, for more than two years after he initially was suspected of espionage.  Either way -- whether the investigation's mistakes have caused us to target the wrong person or whether they delayed us for two years from removing the right person-- the way this investigation was conducted is inexcusable. I urge Secretary Richardson, FBI Director Freeh and Attorney General Reno to do whatever they need to do to appropriately review the manner in which this case was handled, to determine whether any of their employees should be disciplined for their mistakes, and to take whatever steps are necessary to make sure that it never happens again.