DOWNSIDE LEGACY AT TWO DEGREES OF PRESIDENT CLINTON
SECTION: STATUS OF US INTELLIGENCE
SUBSECTION: SOCKOWITZ
Revised 8/5/99
SOCKOWITZ
While at Commerce, Sockowitz, a 1992 Clinton/Gore fundraiser, held a top-secret clearance and kept classified files in a safe. After being transferred to the SBA (without a debriefing) he came back to Commerce and remove 136 files. After he left the SBA he was not debriefed. He now works for the Strategic Planning Group in Bethesda, Md., an international business consulting firm. Justice stopped looking into the security breach matter in December '96 without ever talking to Sockowitz, or his boss whom he followed to SBA, Ms. Lew. Nolanda Hill told Judge Lamberth in March of 1998 that Brown worried that Sockowitz might have ''funneled information to others.''
Among the files of Ira Sockowitz was ''A Study of the International Market for Computer Software With Encryption.'' The CIA marked portions of this report ''secret,'' and the U.S. Bureau of Export Administration said disclosure could ''damage the national security by revealing export control problems that could be exploited to the detriment of the United States.'' Sockowitz also got documents on satellite encryptions from Hoyt Zia, chief counsel for Commerce's Bureau of Export Administration. Zia is a former Democratic National Committee fund-raiser and close friend of Huang.
Also in the Sockowitz files were memos, notes, and file folders from Commerce and the National Security Council on encryption or decoding software, exports and policy options; Satellite-project information; "Space Launch;" "Uranium from Russia;" A CIA report on Russian economic development; and Biographies on foreign political leaders in Bosnia, Croatia, India, Turkey, and Russia.
There are curious connections between Commerce and a Washington based multi-billion dollar satellite company called Iridium, a company created in 1987 with direct ties to late Commerce Secretary Ron Brown and the Democratic party. Leo Mondale, a nephew of the former vice president, is vice president of strategic planning for Iridium. Mondale and Motorola executive Edward Staino hired four of Brown's former employees with high level security clearances to help run Iridium's project on worldwide telecommunications. Motorola also took part in Brown trade-mission trips.
In May of 1995 a former assistant secretary of Commerce, Lauri Fitz-Pegado, a long-time friend of Brown and special adviser to the chairman of the DNC, became vice president of the Iridium division called Global Gateway Management. Her responsibilities at Iridium include coordinating meetings and trips with international investors. She was joined there by her former Commerce assistants Pilar Martinez, Charlotte Kea and Andrew Balfour, who was a director under the executive secretary for Commerce.
Iridium and its investors are hoping to launch 66 low-orbiting satellites to provide wireless communications to deliver voice, data, facsimile and paging services anywhere on the globe at a price of $3 a minute. Once the satellite fleet is in space the system is expected to be operational in September 1998. The team: Russia's Ministry of Atomics; Krunichev Space Research and Production Space Center in Balkonur, Kazakhstan; China Great Wall Industry Group; Iridium China; Iridium Africa; COM DEV of Ontario; Iona Technologies of Dublin; Thai Satellite; and Motorola of India. The America list of companies includes Lockheed Martin Corp., Missiles and Space Division, in California; Sprint; Hewlett Packard; McDonnell Douglas Aerospace of California; Raytheon of Massachusetts; and ARINC of Maryland which does contract work of the CIA.
In 1993, Lockheed Martin (an investor) made one political contribution. In 1995-96, the company made 576 contributions - both to Republicans and Democrats, including $1.6 million in political action committee, or PAC, gifts. Sockowitz walked out with the classified information on the billion-dollar satellite deal that Lockheed entered into with the Khrunichev Space Center in Russia - which is part of the Iridium deal.
Russia's ministry of Atomics (an investor) was allowed to obtain supercomputers capable of designing nuclear weapons. A Russian organized crime figure, Clinton White House guest Grigor Loutchansky, is a player in Iridium's telecommunication plan. Loutchansky is suspected of trafficking in nuclear materials. Sockowitz had a folder called "Uranium from Russia," which may have contained details on US efforts to purchase left over weapons-grade uranium from Russia and revealed where 1,000 tons of such uranium may be stored.
Beijing (an investor) obtained special export waivers. In 1994, AT&T was allowed to send video-conferencing and sophisticated remote command and control systems to a Beijing based company HUA MEI, whose board of directors are members of the People's Liberation Army, or PLA. In 1996 RSA Data Security signed a distribution and development agreement with China's Ministry of Foreign Trade and Economic Cooperation and the Chinese Academy of Sciences Graduate School Laboratory of Information Security, which trains Chinese intelligence agents. RSA had been courting a relationship with China ever since the company attended an encryption conference in Beijing in 1995. The company toyed with selling its encryption patent to the federal government but never did. Indeed, it obtained a special waiver for sales to Beijing at a time when competitors were being prosecuted for selling similar encryption technology overseas. Sockowitz had the files on RSA and its patented encryption technology.
Iridium's Chinese partner, Iridium China (Hong Kong) Ltd., is managed by mainland-born Wang Mei Yue. Wang Mei Yue also happens to be head of China Aerospace International Holdings Ltd. (CASIL) in Hong Kong. CASIL is part of China's defense industrial complex, and is also where Liu Chaoying, the daughter of a top Chinese military official, was employed as a vice president; she is the figure who allegedly funneled money to the Democratic Party. According to the South China Morning Post of Hong Kong, three officials from CASIL sit on the board of Iridium China.
8/28/98 Masood Haider DAWN (Pakistan) "The brother of Osama bin Laden is a director of a US telecom giant, Irridium LLC, according to reports. Although the Clinton administration has made Osama the world's most wanted man, the rest of the family does millions of dollars in business with the US, reports say. Sheikh Hasan bin Laden, one of Osama's many brothers in a Saudi family of immense wealth and far-flung enterprises, is listed by the Securities and Exchange Commission as a director of Iridium LLC, the New York newspaper Daily News said.."
Chicago Tribune 11/2/96 Mary Jacoby David Jackson ".Amid a growing controversy over political contributions, authorities Friday continued to inspect contents of a safe with files that were apparently kept for a top Democratic Party fundraiser by an official in the Small Business Administration. The inspection came a day after 25 of at least 40 files reportedly kept for fundraiser John Huang were taken by a representative of the Central Intelligence Agency, and are being held by that agency, according to congressional sources. The CIA move raises questions as to what the agency is looking at and why. Some of the materials may be classified Commerce Department records involving trade missions. The confluence of foreign trade and campaign contributions is at the center of the current campaign finance controversy.A day after the CIA took possession of the 25 files, 15 others remained in the custody of the Small Business Administration's inspector general. A detailed inventory of those 15 files shows they concerned a broad range of topics and appear to be briefing and background papers for trade missions. It is not clear if they were all collected by Huang, formerly a Commerce Department official, or relate to topics he was working on while at Commerce. Several of the files detail efforts by U.S. computer companies to sell "encryption" software overseas..An official familiar with the investigation said Ira Sockowitz, special assistant to the SBA's deputy administrator, has kept the files in a 600-pound safe that he had installed on Aug. 2. Sockowitz worked at the Commerce Department with Huang, and was detailed to the SBA from the Commerce Department in late May. He began working officially for the SBA on July 7.."
WorldNetDaily 4/6/99 Charles Smith "…In April 1996, Secretary Brown lost his life in the former Yugoslavia. Brown died in a plane crash just outside of Dubrovnik, Croatia. Brown died along with a host of the highest and mightiest of U.S. Corporate heads….. However, another Commerce employee was involved in the fatal Croatia trip. Ira Sockowitz, a DNC fundraiser, New York banker and co-worker of John Huang at the Commerce Dept. was scheduled to fly into Cilipi airport along with Brown. Curiously, Sockowitz chose to leave ahead of Brown on an advance flight instead of going with the Secretary on a flight packed with DNC fat-cats. After the crash, Sockowitz was the man in Croatia that identified Ron Brown's body. Once he was safely back in D.C., Ira Sockowitz collected a vast array of information on Bosnia and Croatia given to Ron Brown for that last flight. In August of 1996, Ira Sockowitz quietly took detailed bios of the Bosnian and Croatian leaders out of the secured facility at the Commerce Department to his new job at the Small Business Administration. These secret documents would join a host of other classified material from the Department of State, NSA, CIA, Commerce, Russia, and France. All hidden in a personal safe just before the 1996 Presidential election…."
Softwar "…However, adding to this mystery, another Commerce employee seems to have been involved in the fatal trip. Ira Sockowitz would collect a vast array of information on Bosnia and Croatia just days before the troubled Mr. Brown would leave for his trip. Fresh bios on all the right people, prepared by an array of professionals from every field of science. This information involved the people Mr. Brown was scheduled to meet in Bosnia and Croatia. Later, in August of 1996, Ira Sockowitz quietly took these bios of the Bosnian and Croatian leaders out of the secured facility at the Commerce Department to his new job at the Small Business Administration. These secret documents would join a host of other classified material from the Department of State, NSA, CIA, Commerce, Russia, and France. All hidden in a personal safe just before the 1996 Presidential election…."
Softwar "…The basic components of a modern war-rocket are the rocket itself, and a re-entry vehicle which is nothing more than a satellite with a heat shield. To control a modern ICBM (Inter Continental Ballistic Missile) you need a computer, some software and a code system. The computers provide the control and the secret codes ensure it will only respond to master. The final component is, of course, the nuclear warhead. Ira Sockowitz left the Department of Commerce and went to his new job at the Small Business Administration with boxes of secret materials. He shouldn't have taken them from the secured facility at Commerce. Inside these boxes are all the basics of modern warfare. Inside one box were materials on secret code keys and the US companies that make them, consuming over half of the materials taken. This author has already spent a great deal of time pursuing some of these documents…."
Softwar "…Yet, Mr. Sockowitz was interested in far more than encryption software. Many more documents left with Sockowitz. The descriptions, forced from the Clinton administration by Judicial Watch, are all that have been released. For example one file in the "SPACE LAUNCH" folder is described as: "Cover sheet for classified info; memo to Bettie Baca from William Reinsch re National Interest Waiver for XXXXXXX Communications Satellite Project with attachments - 4 pages classified documents and 10 pages unclassified documents and Executive Secretariat Clearance Sheet." Bettie Baca is very familiar to Softwar. Ms. Baca wrote this in response to our April 4, 1997 FOIA request for information on the US government project to nationalize the computer security industry: "Seven documents which provide legal advice concerning project Clipper are being withheld under attorney-client privilege incorporated into exemptions (b)(5), two documents are being withheld under the attorney-client privilege and deliberative process privilege incorporated into exemption (b)(5) and one document is being withheld under the deliberative process privilege incorporated into exemptions (b)(5)." …"
Softwar "…Finally, and most chilling of all is the Sockowitz folder labeled "URANIUM FROM RUSSIA". Inside this folder were details of US efforts to buy left-over weapons grade uranium from Russia, including memos to Ginger Lew and others on "Suspension Agreement on Uranium from the Russian Federation". There are even documents filed on Canada: Russia currently has 130 tons of weapons grade plutonium and over 1000 tons of weapons grade uranium left over from the Cold war. These radioactive isotopes pose a great risk to world peace and a great temptation for terrorist states. For example, in late 1995, US intelligence officials picked up indications that Iran was engaged in an effort to steal or purchase 600 kilograms of enriched uranium stored at an unguarded site in the former Soviet Union. Defense officials responded with a plan called "Operation Sapphire" in which the US bought the leftover uranium and quickly transported it to a processing facility where it was diluted for use in commercial nuclear reactors…."
9/1/97 Tim Maier Insight Nation "…Secrets abound. Ira Sockowitz knows that all too well. The former New York administrative law judge and 1992 Clinton/Gore campaign fundraiser walked out the Department of Commerce in June with 2,800 pages of intelligence documents - many dealing with sensitive and highly secret satellite and encryption technologies. "He knew what he was doing," says one congressional investigator. "He had to. He held one of the highest level of clearance - top secret with code word." ….The interest House investigators have shown in Sockowitz is in sharp contrast to the strategy of the Senate Governmental Affairs Committee, which chose to leave the Sockowitz case to others. It also is a signal that the House plans to concentrate on activities at Commerce - just the opposite of Attorney General Janet Reno, who shut down the Justice Department's probe of Sockowitz without even interviewing him…The value of the records could be tremendous for commercial brokers in the international-consulting business - the line of work to which Sockowitz return after his stint with SBA. Congressional investigators would like to know if he has used secret information obtained from those files in any manner for his Washington consulting firm, which conducts strategic planning for international companies. Does it make sense the SBA would be interested in secret information contained in those files relating to rockets, satellites, encryption and CIA political assessments of CHina, Russia and other foreign nations?…."
9/1/97 Tim Maier Insight Nation "… Congressional investigators believe Sockowitz zeroed in on these files because they were a hot commodity in an explosive high-tech market. So hot were they that in November the CIA "blocked access" and prevented House investigators from viewing the documents taken by Sockowitz even though the investigators had all the proper clearances…..Upon first impression the inventory list appears to be a collection of intelligence documents with no apparent common thread connecting them. But there may be. Insight has discovered a trail that leads from Commerce to a Washington based multi-billion dollar satellite company called Iridium. The bulk of the Sockowitz files contain information that could be greatly beneficial to Iridium or its competitors - especially in terms of contracts, customers, and international assessment of foreign countries. Iridium is working with an international team of leading aerospace and electronic leaders in Russia and Red China to construct a worldwide telecommunications network…..Created by Motorola in 1987, Iridium has direct ties to late Commerce Secretary Ron Brown and the Democratic party; Leo Mondale, a nephew of the former vice president, is vice president of strategic planning for Iridium. This year Mondale and Motorola executive Edward Staino hired four of Brown's former employees with high level security clearances to help run Iridium's project on worldwide telecommunications. Motorola also took part in Brown trade-mission trips. Lauri Fitz-Pegado, former assistant secretary of Commerce - and a long-time friend of Brown - and special adviser to the chairman of the Democratic National Committee, or DNC, now is vice president of the Iridium division called Global Gateway Management. She went on board May 5, 1997. Her responsibilities at Iridium include coordinating meetings and trips with international investors. She is joined there by her former Commerce assistants Pilar Martinez, Charlotte Kea and Andrew Balfour, who was a director under the executive secretary for Commerce…"
NSA TESTIMONY ON THE SOCKOWITZ FILES UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA…. Civil Action No. 95-2228 RMU….JON A. GOLDSMITH, hereby declares and states: 1. I am the Chief of External Affairs and Policy for the National Security Agency (NSA). I have served in this position since January 1994. I have served in the NSA for twenty eight years.... Through the exercise of my official duties, I have become familiar with the referral by the Department of Commerce of the documents at issue in this case: A STUDY OF THE INTERNATIONAL MARKET FOR COMPUTER SOFTWARE WITH ENCRYPTION (hereafter the "STUDY"), a document authorized jointly by the Department of Commerce and NSA…… 4. NSAs signals intelligence mission is to obtain information from foreign electromagnetic signals and to provide reports derived from such information or data, frequently on a rapid-response basis, to military commanders, national policy makers and the intelligence community of the United States government. A primary signals intelligence mission of the NSA is to intercept, communications of foreign governments in order to obtain foreign intelligence information necessary to the national defense, national security, or the conduct of the foreign affairs of the United States. The signals intelligence collection mission of the NSA provides national policy maker and the intelligence community with highly reliable foreign intelligence information. Information obtained from intercepted foreign communications is called communications intelligence (hereinafter "COMINT"). NSA's COMINT efforts constitute part of the core functions and activities of the Agency…. 6. In developing its portion of the STUDY, NSA sought and received, information from the Department of State, the CIA and from foreign sources. Some of the information NSA acquired from these sources is classified or otherwise protected information. Those portions, along with the classified or otherwise protected NSA originated information, are identified below in the Vaughn index sections of this declaration….PART II: INDEX OF SPECIFIC PARAGRAPHS WITHHELD From the Document "A STUDY OF THE INTERNATIONAL MARKET FOR COMPUTER SOFTWARE WITH ENCRYPTION," Dated July 1995….. Page II-2, 3rd full paragraph, last sentence: References the views of NSA on the export control process and is protected in its entirety pursuant to exemption (b) (1) (E. O, 12958, Section 1.5 (c), and (g)), exemptions (b) (2) and (b) (3). (Applicable statutes 88-36 and 403). Page II-8, 2nd full paragraph, last sentence: This sentence refers to international export controls and is protected in its entirety pursuant to exemption (b) (1) (EO 12958, Sections 1.5 (b), (c), and (g)). (Applicable statutes 86-36 and 403)…..Refers to export controls between the United States and Canada and is protected in its entirety pursuant to exemption (b) (1) (EO 12958, Section 1.5 (b) and (d))….. Executed this 14th day of June 1996…"
Michael Chapman Investor’s Business Daily 6/19/98 "…When the White House in '96 abruptly gave the Commerce Department power to control exports of sensitive technology to China, it came as a shock... Even more shocking is that, during that same year, Commerce had a hard time controlling breaches of security within its own building. In fact, shortly after the transfer of controls, a former Commerce employee walked in, put classified files about encryption and satellites in a box, and walked out the door. That former employee was Ira Sockowitz, who had been special general counsel at Commerce. Without authorization, he took 136 files -- a total of 2,800 pages. It's unclear how those files were used. But the trove Sockowitz took contained data vital to U.S. security -- and valuable to rival nations. And they may be linked to the current probe of whether technology was illegally transferred to China. Encryption data, for instance, are used by U.S. intelligence to keep government communications -- including instructions sent to satellites or nuclear missiles -- secret. The CIA deemed the material so sensitive that it tried to seize Sockowitz's files as soon as it learned what had happened. Despite the security breach, the Justice Department has decided there is no case against Sockowitz, and Commerce's own inspector general also balked at a probe. Sockowitz claims his reasons for taking the files were innocent. Still, the Sockowitz affair raises troubling questions about the connection between national security and the White House's drive to raise campaign cash in '96.
Michael Chapman Investor’s Business Daily 6/19/98 "…While at Commerce, Sockowitz held a top-secret clearance and kept classified files in a safe. Among these papers was "A Study of the International Market for Computer Software With Encryption." The CIA marked portions of this report "secret" and the U.S. Bureau of Export Administration said disclosure could "damage the national security by revealing export control problems that could be exploited to the detriment of the United States." The secret sections could reveal weaknesses in U.S. encryption defenses, David Sobel, general counsel of the Electronic Privacy information Center, told IBD. Other papers Sockowitz locked away covered "remote sensing satellites," presidential waivers for satellite launches, "space commerce," and country files on China, Russia and India. Sockowitz also got documents on satellite encryptions from Hoyt Zia, chief counsel for Commerce's Bureau of Export Administration…"
Michael Chapman Investor’s Business Daily 6/19/98 "…Zia is a former Democratic National Committee fund-raiser and close friend of Huang. In May '96, Sockowitz's boss, Lew, moved to the Small Business Administration. He followed as her senior adviser on May 27. Three days after he moved to the SBA, Commerce OK'd a Sensitive Compartmentalized Information clearance for Sockowitz, a level above top secret. It let Sockowitz view the government's most tightly classified papers on encryption. Sockowitz didn't get an SBA top-secret clearance until July 29. The agency never gave him SCI. Sockowitz returned to Commerce for a visit on Aug. 2, 1996. While his successor there, Jeffrey May, was out of the office, Sockowitz removed 136 files from his old safe. He told a secretary only that he was gathering some personal items. Sockowitz wasn't debriefed when he left Commerce, something that would have required him to return any classified papers he held. Commerce says Sockowitz violated his clearance by not returning the files. But Sockowitz says his clearance traveled with him to the SBA and that nothing in the security manual prevented him from taking files. Sockowitz also says he never disclosed the papers and they never left his possession. He claims he needed the files for his SBA job. But the SBA told the conservative weekly Human Events that it knew of no projects that Sockowitz was working on that involved encryption, remote-sensing satellites or China…"
Michael Chapman Investor’s Business Daily 6/19/98 "… Sockowitz left the SBA In November '96. Again. he was not debriefed. He now works for the Strategic Planning Group in Bethesda, MD, an international business consulting firm. The company didn't respond to repeated requests by IBD to speak with Sockowitz. Justice stopped looking into the matter in December '96 without ever talking to Sockowitz, Lew or May. Hill told Judge Lamberth in March of this year that Brown worried that Sockowitz might have "funneled information to others." Larry Klayman, chairman of Judicial Watch, told IBD some of the files may have made their way to "a consortium like Iridium." Iridium is a global satellite mobile-phone business with partners such as China Aerospace. It competes with Loral's partly owned subsidiary Globalstar. At least four of Sockowitz's ex-Commerce colleagues work for Iridium. "Sockowitz was the first evidence that there may be an espionage element to this," Klayman said, adding that "Hill can confirm a lot that went on on those trips that dealt with matters that were not legal." For her part, Hill has said that Brown talked to her about how Commerce wanted to end satellite-export controls and how "encryption was a big issue," Klayman said. "Hill can confirm that this whole transfer of satellite technology (abroad) was a major initiative of the Clinton administration, and particularly in the encryption area," Klayman said. "All these companies were competing. And we know from Hill that satellites were what they were after -- the big bucks. Brown was very interested." …"
Insight Magazine 5/26/97 "...There also are others involved in Clinton fund-raising to whom congressional committees are anxious to pose questions about interest in secret U.S. technology. Ira Sockowitz, a Clinton administration lawyer, admitted during a deposition with Judicial Watch, a Washington-based watchdog group pursuing the Clipper documents in relation to Huang's activities at Commerce, that he walked out of the Commerce Department with CIA, NSC and NSA classified files on encryption or decoding software, spy satellites, China, Russia and other countries. Sockowitz, who had a top-secret clearance, was appointed by Clinton to serve as a special legal counsel in Commerce. He says he simply was transferring the files to his new post at the Small Business Administration, where he became deputy administrator in the spring of 1996. The records removed contain some 2,800 pages, including a classified report called "A Study of the International Market for Computer Software With Encryption." Sockowitz, now a Washington consultant, claims he never met Huang, although the two men worked together on the Asian Pacific American Working Group--the principal unit in the DNC responsible for raising about $7 million in campaign contributions in the Asian communities during 1996--much of it returned because of questionable origins.