Tiger Trap

by David Wise

  The group examined what PARLOR MAID might have told the MSS, and what she had gained in return. "The balance," one FBI agent said, "did not look favorable. Storm clouds started gathering."

  As Geide examined the case, he concluded that Leung was well known to the MSS all the way back to her days in graduate school at the University of Chicago. He wondered if she might even have been operating for the MSS all along. If that scenario were true, then the bureau would have to look back at every case. Because, Geide worried, it might mean that the FBI's Chinese counterintelligence program was controlled by China.

  There were "anomalies," as counterintelligence agents call suspicious or unexplained problems. Late in 2000, the investigators discovered the information that had been received ten years earlier identifying PARLOR MAID as the source who had tipped off the Chinese about the FBI's highly successful electronic operation against the consulate in Los Angeles. Once the Chinese discovered the bugs, the FBI operation was toast.

  "It would not have been news to the Chinese that the consulate was bugged," one FBI agent explained. "It was the sophisticated method used that was compromised."

  Although the microphones went silent, it was several years before officials in the consulate suspected that their copying machines had been ingeniously tampered with to transmit documents to the FBI. It was not until the fall of 1999 that the copiers were shipped back to China to be disassembled and analyzed.

  In 2001 the Chinese uncovered twenty-seven satellite-operated listening devices that the National Security Agency and the FBI had planted in the Chinese version of Air Force One while the plane was being refitted in Texas. The aircraft, a Boeing 767, was ordered for Jiang Zemin, the president of China. US contractors in San Antonio built a large bedroom, a bathroom with a shower, and a sitting area with a large-screen TV for Jiang, while a contingent from the People's Liberation Army guarded the $120 million aircraft.

  The work was done by four contractors, Dee Howard Aircraft Maintenance, Gore Design Completions, Rockwell Collins, and Avitra Aviation Services. The plane was delivered to China in August 2001, and soon afterward the bugs were discovered, including some in the headboard of Jiang's bed. According to reports from China, twenty Chinese air force officers and two officials were detained and interrogated after the devices were uncovered.

  The FBI looked into the possibility that Leung had also betrayed the aircraft bugs to Beijing, but was unable to link her to the episode. "Maybe she had nothing to do with it," one official concluded.*

  Counterintelligence is such a convoluted, mirror-image world that some US officials speculated that the entire aircraft-bugging episode was an elaborate ploy by Chinese intelligence. Under this theory, the Chinese, knowing that the United States would surely try to bug the plane, made a show of guarding it but deliberately allowed the devices to be planted, and used American contractors instead of insisting on Chinese workers. Once back in Beijing, the aircraft would be pulled apart and the bugs analyzed to learn the state of the art of US eavesdropping technology.

  In October 2001 Gallagher flew to Los Angeles to talk to Ron Iden, the assistant director in charge of the Los Angeles division, about J.J. Smith and PARLOR MAID. A month later, the FBI asked for a FISA warrant from the special court established by the Foreign Intelligence Surveillance Act to place Katrina Leung's home under electronic surveillance. The FBI already had a video camera in PARLOR MAID's living room, disguised as a motion detector, but that was installed with her knowledge, so that the FBI could secretly tape and record Chinese or other visitors.

  Armed with the court warrant, the FBI secretly searched Leung's home, and tapped her phone calls, faxes, and e-mails. The bureau also placed her under physical surveillance.

  The approval for the FISA warrant was granted by the secretive court in December. That same month, Sheila Horan became the acting chief of the FBI's national security division, succeeding Gallagher, who had retired.

  By then, rumors of the romance between PARLOR MAID and J.J. had reached headquarters. Once the wiretap and bugs were in place in the house in San Marino, PARLOR MAID's affair with J.J. was quickly confirmed. The "special techniques" used by the FBI discovered, as the Justice Department inspector general's report put it delicately, that the relationship between J.J. and Leung was "more than friendship."

  Sex is not a federal crime, for which everyone can be grateful. But the electronic surveillance of the Leungs' home provided graphic evidence that there was a major problem in the bureau's Los Angeles field office. What the bureau now had to contemplate was the horrendous possibility that China had penetrated the FBI.

  Early in January 2002 Horan briefed Robert Mueller on the situation. A veteran bureau agent, Horan had been sent to Africa by the FBI to take charge of the investigation into the 1998 US embassy bombings in Kenya and Tanzania that killed 224 people and wounded 4,000.

  Because the FBI director had taken over just before 9/11, the terrorist attacks on New York and Washington had occupied most of his attention. When he heard what had been going on in Los Angeles, he went ballistic.

  Early in January 2002 Mueller held a flurry of meetings with Horan, Geide, Iden, and Lance Woo, the China squad supervisor in the Los Angeles field office. The atmosphere was beyond tense.

  The Los Angeles and headquarters officials blamed one another for the slow progress of the investigation into the Chinese counterintelligence program in Los Angeles. "Who's in charge?" Mueller demanded. No one offered an answer.

  At one point, Iden left FBI headquarters for Dulles International Airport, and was on a flight en route to Los Angeles when he was reached by Mueller, who ordered him to return to headquarters for another meeting. As soon as Iden landed at LAX—there was no time for him even to run home and change his shirt—he turned around and boarded the redeye back to Washington.

  Sheila Horan, an experienced career agent with twenty-nine years in the bureau, was caught in the fallout. As acting chief for national security, she was in the bull's-eye and received the full fury of Mueller's wrath.

  "I'm removing you," Mueller told her.

  Swept aside in the turmoil over PARLOR MAID, and with no other good options open to her, Horan transferred to an administrative post in the bureau and retired later that year. Many of her colleagues in the FBI felt she had been unfairly blamed for the debacle in Los Angeles.

  After Mueller had been briefed, he ordered a full field investigation opened of J.J. Smith. He also appointed Randy Bellows, the same federal prosecutor who investigated the FBI's handling of the Wen Ho Lee case, to review the situation in Los Angeles and recommend what should be done. Bellows, who had prosecuted Robert Hanssen, the KGB mole in the FBI, moved quickly. He urged that Mueller appoint an FBI agent with the rank of inspector to take charge of the investigation.

  Mueller knew what he had to do. He sent for Les Wiser.

  FBI agent James J. Smith and Katrina Leung, code name PARLOR MAID, watch the 2001 inaugural parade of President George W. Bush in Washington, DC. For years Leung secretly passed FBI secrets to the MSS, the Chinese intelligence service.

  © 2001 Michael Lutzky/The Washington Post

  The FBI's William V. Cleveland Jr., like Smith a top Chinese counterintelligence agent, worked with Leung on the TIGER TRAP case. The central figure in that case, Gwo-bao Min, a scientist at the Lawrence Livermore nuclear weapons laboratory, was forced out after the FBI suspected he had leaked details of the neutron bomb to China. © 2002 Robert C. Bain/San Jose State University

  Hanson Huang, a Harvard-trained lawyer and friend of Katrina Leung, met clandestinely with Min, the TIGER TRAP suspect, and according to the FBI passed nuclear weapons information to Beijing through the Chinese embassy in Washington.

  Chien Ning, a prominent Chinese geophysicist, introduced Gwo-bao Min to Hanson Huang when the Livermore scientist visited China. The FBI believed she was sent to California to handle intelligence assignments for the MSS, which Chien denied.

  South China Morning Post<
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  Veteran FBI agent Dan Grove was able to intercept a letter from Beijing that provided key evidence in the TIGER TRAP case, revealing China's efforts to steal US nuclear secrets.

  "It was a nightmare come true." FBI director Robert S. Mueller III was furious when he learned that PARLOR MAID—the double agent the bureau relied on as its best spy against Beijing—had actually been passing secrets to Communist China for more than a decade, and that the FBI's two top agents handling Chinese counterintelligence had both carried on long-running sexual affairs with her. FBI

  Leslie G. Wiser Jr., the FBI's ace counterintelligence agent, was called in by Mueller to investigate the parlor maid debacle. With a team of some two dozen carefully selected agents, Wiser set up a secret office in Los Angeles and broke open the case. In April 2003 both Leung and Smith were arrested by the FBI.

  A Chinese "walk-in" turned over a document to the CIA revealing that China had somehow acquired the ultra-secret details of the W-88, America's most sophisticated nuclear warhead, which sits atop the missiles on the Navy's Trident submarines. Despite Beijing's knowledge, details about the warhead are still secret in the US. Enough information was learned about the Chinese document, however, to make this artist's rendition fairly accurate. Ian Cunningham

  This unusual photograph of the W-88's cone-shaped reentry vehicle reveals the warhead's small size. The man in the photo is Bob Putnam of the Los Alamos National Laboratory, where the weapon was designed. LANL

  September 13, 2000: Los Alamos scientist Wen Ho Lee leaves federal court in Albuquerque, New Mexico, with daughter Alberta and attorneys Mark C. Holscher (right) and John D. Cline after pleading guilty to one felony count of mishandling classified documents and receiving a dramatic apology from a federal judge for the harsh conditions in which he was jailed. Lee was originally suspected, but never charged, with leaking the W-88 to China. The government produced no evidence he had. Unknown to the public, however, Lee had been the subject of two previous FBI investigations for suspicious actions—contacting the TIGER TRAP suspect and concealing a meeting with China's top bomb maker. AP Images

  A secret FBI report on President Nixon's relationship with Marianna Liu, a beautiful Hong Kong bar hostess, was given to J. Edgar Hoover, the bureau's director. This photo of Liu and Nixon was taken in 1966 at the Den, the popular nightspot where she worked.

  Hong Kong Standard

  This secret 1976 FBI document repeats unconfirmed reports that Liu "was a regular bedmate" of former vice president Nixon during his visits to Hong Kong in the 1960s. Liu, found and interviewed by the author, denied both a romance with Nixon and British and US suspicions that she worked for Chinese intelligence.

  Katrina Leung and her husband, Kam, face reporters outside the federal courthouse in Los Angeles on December 16, 2005, after she pleaded guilty to lying about her affair with FBI agent James J. Smith and failing to pay taxes on thousands of dollars the bureau paid her as a double agent. Although the government said she secretly passed FBI secrets to Chinese intelligence for years, she was not charged with espionage. AP Images

  The Spymaster: Geng Huichang moved up in 2007 to become chief of the MSS, the Ministry of State Security, as part of a government shakeup by President Hu Jintao, who sought to consolidate his power by naming five political allies as ministers.

  CNS

  Michael W. Emmick prosecuted Katrina Leung for copying FBI secrets for China. The Justice Department was stunned when federal judge Florence-Marie Cooper threw out the case against PARLOR MAID, charging government "misconduct." She singled out Emmick, but later retracted her remarks about the prosecutor, saying he was not responsible.

  ETHEREAL THRONE: Jeff Wang, a defense engineer, lost his job after being falsely accused as a Chinese spy by an FBI informant who had a personal grudge against him. Denise Woo, a decorated FBI agent, was dismissed and prosecuted after she tried to clear the innocent man. She is shown here in happier times, receiving a congratulatory handshake from then FBI director Louis Freeh. FBI

  Chinese intelligence penetrated the CIA for thirty years with Larry Wu-Tai Chin, a top translator for the agency, who was caught by the FBI when he was careless with a Beijing hotel room key. A Catholic priest in New York's Chinatown may have been sent by China's spy service to try to help Chin escape when the FBI closed in. AP Images

  Wen Ning, code name ANUBIS, spied for the FBI while a diplomat inside the Chinese consulate in Los Angeles. He later went to prison for illegally exporting electronic parts and militarily useful technology to China.

  Courtesy of Herald Times Reporter, Manitowoc

  Family of spies: Chi Mak, shown here with his wife, Rebecca Chiu, secretly passed sensitive Navy documents on US weapons systems to China for more than twenty years. He was convicted and in 2008 sentenced to twenty-four years in prison. The government charged he headed a spy ring that included his wife, his brother, Tai Mak, and Tai Mak's wife and son. All five were convicted on various charges. FBI

  "I work for Red Flower of North America." Tai Mak's phone call to his contact in Zhongshan, China, was intercepted by the FBI. About to board a flight to Hong Kong, he was arrested at Los Angeles International Airport with computer disks containing data about the Navy's Quiet Electric Drive, designed to allow submarines to run silent. He was sentenced to ten years. FBI

  "This channel is much safer than the others." Dongfan Chung (right) is shown with Gu Weihao, an official of China's Ministry of Aviation, who assured him he could safely pass defense secrets through Chi Mak. Chung, an engineer for Boeing, collected data for China on the space shuttle and the B-1 bomber. He was convicted of economic espionage and in 2010 sentenced to fifteen years and eight months. FBI

  Tai Shen Kuo, a New Orleans businessman, was paid by Lin Hong, a Chinese military intelligence officer, to enlist Pentagon officials in a Chinese spy network. Caught by the FBI, which took this surveillance photo of him, Kuo pleaded guilty under the espionage laws. In 2008 he drew a sentence of almost sixteen years, later reduced to five for cooperating with prosecutors. FBI

  Yu Xin "Katie" Kang, Tai Shen Kuo's young Chinese girlfriend, served as a cutout between Kuo and his handler in China, Lin Hong. Kuo had dominated her life since she was a teenager. Prosecutors recognized that she had been used and controlled for years by Kuo, and she received a much lighter sentence of eighteen months. FBI

  Gregg W. Bergersen, a Defense Department official with a weakness for gambling, turned over Pentagon documents to Tai Shen Kuo, who passed them on to China. Bergersen, shown in this FBI surveillance photo, thought the data was going to Taiwan. He pleaded guilty to conspiracy to disclose national defense information and was sentenced in 2008 to just under five years. FBI

  A second Pentagon official, James W. Fondren Jr., held a top secret clearance as deputy chief of the Washington liaison office for the US Pacific Command (pacom). He met in China with Lin Hong, who gave him the code name fang. Fondren, who turned over classifi ed information to Kuo, was convicted and sentenced in 2010 to three years. FBI

  Chapter 14

  THE COUNTERSPY

  THE DIRECTOR WANTS to see you."

  Les Wiser, the FBI's ace counterintelligence agent, the man who caught Aldrich Ames, had no idea why FBI chief Robert S. Mueller III had summoned him to his office. But Wiser's antennae were up; whatever it was could not be good news. The director would not have sent for him unless major trouble was brewing.

  Even so, Wiser was not prepared for what he learned. Mueller wasted no time on preliminaries. The FBI, he told Wiser, had been penetrated by Chinese intelligence. Katrina Leung—code name PARLOR MAID—the woman the bureau had relied on as its best spy against Beijing, had actually been working for Communist China for more than a decade. It was a nightmare come true. Mueller was grim, still furious over the details, which he had learned only days earlier.

  It got worse. Wiser could hardly believe what Mueller revealed next. PARLOR MAID's handlers, who had been the FBI's two top counterintelligence agents target
ing China, had carried on long-running sexual affairs with Katrina Leung. The FBI agent in Los Angeles, who had recruited her twenty years earlier, was her lover. So, for several years, was the bureau's top China expert in San Francisco.

  Not only that, both FBI agents knew that PARLOR MAID had been recruited by Chinese intelligence. They found that out in 1991, yet headquarters had agreed they could continue to run her. It was an unbelievable mess.

  The bureau would have to review everything PARLOR MAID had told the FBI for years, including information that had gone straight to the White House. Leung had been considered so reliable that her information was passed up the chain of command to four US presidents—Ronald Reagan, George H.W. Bush, Bill Clinton, and George W. Bush. Now the FBI would have to assume that much of it might be false.

  Then Mueller gave Wiser his marching orders.

  "Go to LA and take care of this," he said.

  The FBI director did not have to spell out what remained unspoken. The disaster in Los Angeles was only the latest calamity to hit the bureau. Still reeling from its failure, along with the CIA, to prevent the 9/11 terrorist attacks in 2001, and the arrest earlier that year of FBI special agent Robert Hanssen as a Russian spy, the FBI now was dealing with an explosive internal scandal that was sure to become public.