STATEMENT OF SENATOR FRED THOMPSON
THOMPSON-LIEBERMAN REPORT
AUGUST 5, 1999

Senator Lieberman and I are pleased to issue this report on the Department of Energy, the FBI, and the Justice Department’s Handling of the Espionage Investigation into the Compromise of Design Information on the W-88 Warhead. We thought it was important for the American people to understand what happened with respect to the Government’s handling of these important matters. The Governmental Affairs Committee is the most appropriate place to examine these issues because of its comprehensive oversight role over all these agencies with respect to "the effectiveness of present national security methods, staffing, and processes," its jurisdiction over nuclear proliferation, and its authority over the organization of the government.

The Committee held about thirteen hours of closed session hearings on the matter of the compromise of the W-88 information. The testimony necessarily addressed highly classified information, including some specifics about the sources and methods of our intelligence operations. From the start, we set out to hear from the people who actually were involved in conducting the investigation, rather than from agency heads. Although Sen. Lieberman and I initially hoped that we could hold public hearings, we decided that it would be difficult to piece the story together in such a forum, especially given the classified nature of much of the subject matter. Instead, we have decided to issue this statement to tell the story, focusing on how our government agencies performed when faced with an important matter.

In considering this issue, we are mindful that it is not our job to pass judgment on individual wrongdoing that is the subject of an ongoing criminal investigation. Rather, our examination focuses on now-completed phases of the W-88 investigation, and on whether the various government agencies involved dealt properly with the information that they possessed at the time. We asked the FBI, Energy, and Justice to help us declassify a document, and they were cooperative in working with us to do so. This report is a factual analysis of the handling of the W-88 case from 1995 through early 1999. Members of the committee and others are free to draw their own conclusions from its contents.

It seems clear to me that:

** Energy Department personnel and professional FBI investigators did not learn for four years the simple fact that Wen Ho-Lee had signed a waiver that might have allowed his computer to be searched or monitored much earlier than it was.

** The FBI agent on the case never sent to FBI headquarters the documents the Energy Department provided him about DOE policy on monitoring employee computers. This meant that the FBI was deprived of the opportunity to see whether it would have been justified in undertaking a computer search. The agent’s failure to transmit the documents also possibly affected the FBI’s decision to pursue unsuccessfully, and perhaps unnecessarily, a FISA warrant.

** Possibly for the first time ever, the Department refused to take the FBI’s request for a FISA warrant to the FISA court. It adopted a highly restrictive view of probable cause, even though the showing necessary in a national security context is less than for a criminal investigation. Even if one disagrees that there was more than enough probable cause, a case clearly can be that it should have gone to the FISA court. In enacting the Foreign Intelligence Surveillance Act in 1978, Congress intended that the court is to decide whether there is probable cause in close cases. But there is also an effective appeal procedure if the FISA court turns down the warrant request. The Justice Department decided itself that it would not even allow the FISA court to determine that probable cause existed with respect to a matter that it recognized was a high priority national security issue. And no one in the Department, for whatever reason, thought that the rejection of such a significant search should receive any serious personal attention from the Attorney General.

** Ultimately, the FBI did appeal OIPR’s decision to the Attorney General – this in itself was unprecedented. But the task was delegated to another official, who knew essentially nothing about FISA and had never handled such a matter before. Without apparently conferring with the FBI, this official agreed with OIPR that probable cause was lacking.

** After Lee took a polygraph and the FBI obtained Lee’s permission to search his computer in 1999, the FBI again asked OIPR for a FISA warrant. Although the FBI presented OIPR with newly obtained information from the polygraph and the computer search, OIPR still refused to take a FISA request to the court.

The matter at hand is of great significance to our national security. When an issue as important as the theft of design information of our most sophisticated nuclear warhead is alleged to have occurred, it is vital that our national security apparatus be able to move rapidly and effectively to determine the facts, and, where appropriate, identify and apprehend those responsible. This is a story of investigatory missteps, institutional and personal miscommunications, and legal and policy misunderstandings and mistakes at all levels of government. The DOE, FBI, and DOJ must all share the blame for our government’s poor performance in handling this matter.

We will continue to pursue this matter in the Governmental Affairs Committee, following up on what we have learned, and perhaps hearing from additional witnesses. This is an important part of the story, based on our desire to start from the ground up, but other committees will also be active through obtaining answers from high-level officials. There are additional actions to take as well. The FISA statute may need to be amended; not because it is poorly drafted, but to overcome the Justice Department’s cramped interpretation. We will need to keep a close eye on how DOJ conducts this espionage investigation, such as whether there might be other sources of the compromise. It will also bear watching to see what DOJ’s internal investigation of this matter concludes. And Congress will need to address in some form how intelligence information is integrated with criminal investigations and how criminal and intelligence law enforcement personnel can work better together.