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Massive Israeli Spy Ring Uncovered

January 3, 2005

The details of a massive Israeli spy ring that operated across the United states - employing intelligence agents posing as "art students" to gain access to sensitive U.S. government offices, defense companies, and the private homes of employees of the Drug Enforcement Agency (DEA) - started to emerge in early 2002. What has now become clear is that the agents and modus operandi of the ring were known by the highest levels of government and that policies were changed to counter the threat of Israeli surveillance through computer networks.
 
The explosive story of the Israeli spy ring, discovered operating in the United States in 2001, and the 61-page DEA task-force report that contained the details about this spy ring was first revealed in detail on March 4, 2002, by Intelligence Online (IO), a well-respected Internet news service based in Paris, France. IO's story elaborated in some respects on earlier findings by Carl Cameron of Fox News who referenced the "Israeli art students" in his reporting. The IO story was picked up by the leading French daily, Le Monde, and by the Associated Press, but was quickly dropped.
 
Referring to the reports, the March 15, 2002, issue of Forward, one of the oldest Jewish newspapers in America, commented that: "Despite angry denials by Israel and its American supporters, reports that Israel was conducting spying activities in the United States may have a grain of truth, the Forward has learned." Forward wrote: "Both the French and the Fox reports were dismissed by Israel and its supporters and received limited coverage in the American media."
 
Le Monde and Fox (as well as IO) suggested the likelihood that these Israeli operatives were spying on Arab terrorist cells operation in the United States and almost certainly had advance knowledge about the impending 9-11 attacks - a theory that inflamed Israel and its American supporters. The Associated Press was careful not to mention this aspect of the story.
 
A British intelligence and military analysis publication, Jane's Information Group, noted the peculiar absence of reporting in the American media on the "explosive story" of the huge network of Israeli spies that made headlines around the world:
 
It is rather strange that the U.S. media...seem to be ignoring what may well prove to be the most explosive story since the Sept. 11 attack, the alleged breakup of a major Israeli espionage operation in the United states which aimed to infiltrate both the Justice and Defense departments and which may also have been tracking al Qaeda terrorists before the aircraft hijacking took place.
 
Reports of Israeli "art students" calling on DEA employees across the country began as early as January 2000 and continued through June 2001. What is not clear is what the ring of more than 120 agents was up to and why some Israelis linked to the attacks in New York and Washington were allowed to flee or were sent back to Israel, after Sept. 11 on visa violations, rather than being charged and prosecuted.
 
The "art students" are reported to be active agents in electronic surveillance units of the Israeli military. The Israelis covered the country in "organized" teams of eight to 10 people, with each group having a team leader. The DEA document lists the Israelis' military and intelligence specialties as "special forces," "intelligence officer," "demolition/explosive ordnance specialist," "bodyguard to head of Israeli army," "electronic intercept operator," and "son of a two-star (Israeli) army general."
 
American intelligence services have become worried by the dominance of Israeli companies in sensitive areas of telecommunications. One Israeli company, Comverse Infosys (now called Verint), has provided law enforcement agencies with computer equipment for wiretapping. It is thought that the equipment came with "catch gates" that allowed the Israelis to listen in. Software made by Amdocs, another Israeli outfit records virtually every call placed through the 25 largest U.S. telephone companies. The relationship of these companies to the detained Israelis is detailed in the 60-page document.
 
The DEA document reveals that many of the Israeli operatives had addresses in San Diego, Little Rock, Irving (Tex.) and South Florida very close to the homes of Arabs suspected of involvement in the Sept.11 terror attacks. A Justice Department official briefed on an ongoing multi-agency task force investigation the Israeli spy ring was quoted by newsweekly Insight as having said: "We think there is something quite sinister here but are unable at this time to put our finger on it." Another law-enforcement official said: "The higher-ups don't want to deal with this and neither does the FBI because it involves Israel."
 
The DEA report found that several military bases also had experienced unauthorized entries by the Israelis including two bases from which Stealth aircraft and other super-secret military units operate. Unauthorized photographing of military sites and civilian industrial complexes, such as petroleum-storage facilities was also reported, the document confirms.
 
The DEA document describes "scores of encounters" between federal agents and Israeli agents posing as art students. The seemingly innocuous cover was used to gain access to sensitive U.S. offices and military installations, such as MacDill Air force Base in March 2001, and Tinker Air Force Base in Oklahoma City one month later, where "a special alert" was issued because of the aggressive Israeli agents. Tinker houses AWACS surveillance planes and repairs B-1 bombers. The Oklahoman, prompted by the French revelations, reported that in 2001, four of the Israeli agents carrying military IDs were detained at Tinker Air Force Base in Oklahoma.
 
In virtually every incident reported by the DEA field offices the Israelis used the same methods: Israelis would attempt to enter secure buildings, take photographs, follow federal agents when they left buildings, show up at their homes and circle their neighborhoods, visit their houses and then depart. At a DEA agent's house in Chicago, Israelis were so aggressive the police were called.
 
SUSPICIOUS ACTIVITIES
 
One report, titled "Suspicious Activities Involving Israeli Art Student at DEA Facilities," lists more than 180 documented-incident cases. "The nature of the individuals' conduct, combined with intelligence information and historical information regarding past incidents involving Israeli organized crime, leads IS [Internal Security of DEA] to believe the incidents may well be an organized intelligence-gathering activity," said one classified document quoted by Insight.
 
This is very odd behavior under any situation," says a DEA official who had heard but not yet seen the reports until Insight shared them. "The patterns are clear and they pose a significant danger to our officers in the field."
 
I spoke with Guillaume Dasquie, of IO, who told me that he had solid evidence of the authenticity of the DEA document, and would reveal new evidence to counter claims made by the Department of Justice that there had been "no case of Israeli espionage" and that the matter was "an urban myth."
 
The Israeli spy ring was "examined at the highest levels of the Bush administration," according to Dasquie. On March 13, 2002, IO was informed by an official at the Department of Justice that the report had been handed over to the department's Joint Terrorism Task Force. The same day, at a DEA press conference, the agency's administrator, Asa Hutchinson, said that he had passed the document along to "other agencies" working on the matter.
 
On March 14, 2002, IO said it has a copy of a memorandum dated March 4 and signed by Robert Diegelman, assistant attorney general for administration. The memo was addressed to officials in charge of the justice department's information systems. It called on them to forbid information system access to all non-U.S. citizens and no longer use foreign-supplied computer and communication gear.
 
The memo referred to a warning entitled Department of Justice Order 2640.2D Information Technology Security dated July 12, 2004, which cautioned against using information technology sold by foreign firms. The warning of July 12 confirmed that the DEA's report was a security concern at the highest level.
 
The DEA task force issued an initial report in June 2001 that listed the names of 125 Israeli nationals and described their activities in the United States. The document suggests that the ring had infiltrated federal buildings and that Israeli computer companies sell equipment to U.S. government departments. The DEA purchased $25 million worth of interception equipment in September 1997 from a number of Israeli companies named in the report.
 
An AP report on March 9 confirmed that the DEA document had been the joint work of a task force. The AP report confirmed that several of the Israelis had never enrolled in the art colleges they claimed to attend in Israel. In addition, IO reported: "We've also obtained an internal document from the U.S. Coast Guard, an intelligence bulletin dated Jan. 17, 2002. Reserved for security bosses in America's biggest companies, the bulletin regularly tracks all attempts to penetrate protected sites recorded by the U.S. Coast Guard."
 
The Jan. 17 issue described the case of a man and woman "of Middle East origin" taking pictures of a refinery. When questioned they said they were "art students' even though they were able to discuss technical details concerning refineries, according to IO.
 
A spokesman for Attorney General John Ashcroft initially attempted to dismiss the story as an "urban myth." However, the New York-based Forward exposed Ashcroft's prevarication when it admitted on March 15, 2002:

In March 2001, the federal National Counterintelligence Executive issued a warning urging employees to report all contact with people describing themselves as Israeli art students. It said some had gone to private residences of senior U.S. officials under the guise of selling art.


"These individuals have been described as aggressive," the warning said. However, the warning added that there may be two groups involved, one with an "apparently legitimate money-making goal while the second, perhaps a non-Israeli group, may have ties to a Middle Eastern Islamic fundamentalist group."
 
The idea that two such groups were operation at the same time (and that one may have been a "non-Israeli group" presumably posing as Israelis) should raise questions. The evidence indicates that Israelis operating in the United States often pose as Arabs. Forward defends Israel saying that "far from pointing to Israeli spying against U.S. government and military facilities...the incidents in question appear to represent a case of Israelis in the United States spying on a common enemy, radical Islamic networks suspected of links to Middle East terrorism."
 
Attempting to put a positive spin on the revelations, Forward contends that tensions between the United States and Israel arise not from the fact that the United States believed the Israelis were spying on Americans, but because the Israelis had failed to advise the United States that they were engaged in spying against Arabs on American soil.

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