FOR IMMEDIATE RELEASE
November 18, 1996
Attorney General Janet Reno, Director of Central Intelligence John Deutch, Federal Bureau of Investigation Director Louis J. Freeh and U.S. Attorney for the Eastern District of Virginia Helen Fahey today announced that Harold James Nicholson of Burke, Virginia, age 46, was arrested Saturday and charged this morning under Title 18, United States Code, Section 794 with espionage and conspiracy to commit espionage by passing classified CIA documents to agents of the Russian Federation Foreign Intelligence Service (SVRR), the Russian successor to the KGB. Affidavits unsealed in the U.S. District Court in Alexandria today include allegations that Nicholson made $120,000 in unexplained deposits to his bank account following trips abroad (including an unauthorized meeting with SVRR intelligence officers) and that federal authorities intercepted postcards mailed to his handlers, recovered classified information from his laptop computer, observed him photographing classified documents, and that a search of his office revealed numerous classified materials concerning Russia that were not related to his CIA duties.
DCI Deutch said, "The arrest of Nicholson is the direct result of an unprecedented level of cooperation between the CIA and the FBI. We are now able to demonstrate quite conclusively that the post-Ames reforms work as designed. Clearly the post-Ames analysis and detection mechanisms the CIA and FBI put in place succeeded in the identification of Nicholson and his alleged espionage activities on behalf of the Russian intelligence service."
Attorney General Janet Reno said, "I am extraordinarily proud of the men and women of all the agencies that worked together so diligently to make this possible. Cooperation among our U.S. Attorneys' offices, the Department of Justice, the FBI and the CIA is essential to preventing, detecting and punishing espionage."
FBI Director Freeh said, "The announcement today starkly demonstrates the continuing threat to our national security by foreign intelligence services. The Ames case demonstrated that the level of vigilance against espionage cannot be lessened without risking great harm to our national security. The most formidable weapon against this grave crime is a close partnership between the FBI and the CIA. It is that partnership that made today's announcement possible."
Deutch, Freeh and Reno praised the many employees of the FBI and the CIA both here and abroad who worked so diligently on this investigation. Freeh especially praised the superb work done on this investigation by the Agents and employees of the FBI's Washington Field Office, those employees out on the front line who must delicately collect the pieces of evidence required to make these cases. Both Deutch and Freeh acknowledged that these extraordinarily complex and sensitive investigations require extreme professionalism and dedication if the United States is to prevent or solve these crimes, which are so repugnant to our system of government.
Both Deutch and Freeh also expressed grave concern, noting that the unauthorized disclosure of the type of information Nicholson had access to could irreparably damage the national security of the United States.
The complaint and supporting affidavit charge that Nicholson possessed documents containing the names and biographical data and assignment of CIA case officers and the identity of a CIA employee scheduled for a sensitive overseas assignment. Nicholson's position as a staff instructor gave him access to biographical information and the assignments of every new CIA officer trained at his location during his tenure. Nicholson also possessed classified reports by access agents, people who voluntarily provide information to CIA, often at great risk to themselves.
The CIA and FBI have implemented a number of reforms and new procedures at the CIA that are designed to detect the slightest of early warning signs of espionage. As a direct result of these reforms, anomalies were detected that ultimately led to the identification of Nicholson and his alleged espionage activities. These reforms include:
In furtherance of the investigation, FBI Agents over the last three days also searched Nicholson's residence in Burke, Virginia, his office at CIA Headquarters, his vehicle and his safe deposit box.
The charge against Nicholson carries a possible sentence of life imprisonment without parole or, if certain statutory conditions set out in Title 18, United States Code, Section 794 are met, the death penalty. At this time, based on the state of the investigation to date, those statutory conditions have not been met.
Copies of the complaint and supporting affidavit are available.
I, Michael Lonergan, being duly sworn, hereby state the following under penalty of perjury:
1. I am a Special Agent (SA) with the Federal Bureau of Investigation (FBI), and have been so employed for approximately nine years. I am currently assigned to the Washington Field office to a squad responsible for investigating matters pertaining to foreign counterintelligence. I have worked on foreign counterintelligence matters as an FBI SA for a total of seven years. During that time period, I have been involved in a number of counterintelligence investigations, and received numerous hours of training in the tactics, methods and techniques of foreign intelligence services and their agents.
2. As more fully described below, HAROLD JAMES NICHOLSON, an American citizen and employee of the Central Intelligence Agency (CIA), has been acting clandestinely, corruptly and illegally as an agent of the Russian Federation foreign intelligence service, Sluzhba Vneshney Razvedki Rossii, commonly referred to within the U.S. intelligence community as SVRR. The SVRR is the direct successor to the Committee for State Security of the Union of Soviet Socialist Republics (hereafter USSR), known as the KGB. By his actions, NICHOLSON has committed violations of 18 U.S.C. 794(a) and (c), that is, with reason to believe that it would be used to the injury of the United States and the advantage of a foreign nation, he has unlawfully and
knowingly conspired to communicate, transmit and deliver to representatives of a foreign government, specifically the Russian Federation, information relating to the national defense of the United States. The investigation reveals that the Russian Federation has paid NICHOLSON over $100,000 since June, 1994 for his unlawful acts.
3. Information in this affidavit is based on my personal knowledge and on information provided to me by other law enforcement officers. This affidavit also relies on information provided by the CIA, which has cooperated with the investigation. This affidavit is not intended to be an exhaustive summary of the investigation against NICHOLSON, but is for the purpose of setting out probable cause in support of:
a. a complaint charging HAROLD J. NICHOLSON with a violation of Title 18, United States Code Section 794(c) (conspiracy to commit espionage);
b. an arrest warrant for HAROLD J. NICHOLSON;
c. a search warrant for NICHOLSON's residence at 5764 Burke Towne Court, Burke, Virginia, in the Eastern District of Virginia;
d. a search warrant for NICHOLSON'S workspace, located in Room 6E2911, Old HQ Building, CIA Headquarters, Langley, VA;
e. a search warrant for NICHOLSON'S vehicle, a 1994 Chevrolet Lumina Sports Van, Virginia license plate 8888BAT;
f. a search warrant for a safe deposit box in the name of HAROLD J. NICHOLSON, Box #417, located at Selco Credit Union in
Springfield, Oregon.
g. a search warrant for any luggage that NICHOLSON may be carrying or may check at Dulles Airport on November 16, 1996, the day of his arrest.
4. Pursuant to Executive Order 12958, information which, if disclosed without authorization, could reasonably be expected to cause "damage to national security," must be classified as CONFIDENTIAL and properly safeguarded. Information which, if disclosed without authorization, reasonably could be expected to cause "serious damage to the national security," must be classified as SECRET and properly safeguarded. Information which, if disclosed without authorization, could reasonably be expected to cause "exceptionally grave damage to the national security," must be classified as TOP SECRET and properly safeguarded. When a classified document can be released to a particular foreign country, the originating agency will usually place markings at the top of the document to show that it is releasable to that country.
5. This affidavit refers to information obtained from electronic surveillance, video surveillance and searches of NICHOLSON's car, workspace, mail, residence and computers. In each instance, the searches and surveillances were authorized by order of a U.S. court.
6. HAROLD JAMES NICHOLSON, was born on November 17, 1950, in Woodburn, Oregon. He is divorced, and has three children.
NICHOLSON entered on duty as an employee of the CIA on October 20, 1980. According to CIA records, NICHOLSON took the oath of office on January 26, 1982, where he stated that "I will support and defend the Constitution of the United States against all enemies foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God."
7. I have reviewed NICHOLSON's CIA personnel and security files. These files reveal that throughout NICHOLSON's employment with the CIA, he has held a "Top Secret" security clearance, and had regular, frequent access to sensitive classified information. I have also reviewed a document signed by HAROLD J. NICHOLSON entitled "Sensitive Compartmented Information Nondisclosure Agreement." In this document, NICHOLSON acknowledges that he has been granted access to Sensitive Compartmented Information (SCI) as part of his employment, that any unauthorized disclosure of such highly classified information is a violation of federal criminal law, and that any unauthorized disclosure of SCI information could irreparably injure the United States or provide an advantage to a foreign nation. In this signed document, NICHOLSON agrees that he will never divulge classified information to anyone not authorized to receive it without prior written authorization from the United States.
8. In his career with the CIA, NICHOLSON has been assigned duties throughout the world. He has worked for the CIA as an operations officer specializing in intelligence operations against foreign intelligence services, including the intelligence services of the USSR and later, the Russian Federation. Specifically, from 1982-85, NICHOLSON worked for the CIA in Manila, where he had sustained, direct contacts with targeted Soviet officials. NICHOLSON worked for the CIA in Bangkok from 1985-87, and in Tokyo from 1987-89. From 1990-92, NICHOLSON was the CIA Chief of Station in Bucharest, Romania. From 1992 until 1994, NICHOLSON was the Deputy Chief of Station/operations officer in Kuala Lumpur, Malaysia, where, among other duties, he met with and targeted for recruitment Russian intelligence officers. From 1994 until July, 1996, NICHOLSON worked as an instructor at the classified CIA Special Training Center ("STC") in the Eastern District of Virginia, teaching CIA trainees intelligence tradecraft. In July, 1996, NICHOLSON was assigned as a Branch Chief in the Counterterrorism Center, Directorate of Operations, at CIA Headquarters in Langley, Virginia. This position carries a pay grade GS-15, and his current salary is approximately $73,000; it is the highest pay grade NICHOLSON has held during his CIA employment.
9. According to CIA records, NICHOLSON owns and currently resides in a townhouse at 5764 Burke Towne Court, Burke, Virginia, in the Eastern District of Virginia. Virginia
Department of Motor Vehicle records show that a Chevrolet Lumina Sport Van, Virginia plate no. 8888BAT, is registered to HAROLD J. NICHOLSON.
Polygraphs
10. On or about October 16, 1995, and October 20, 1995, NICHOLSON underwent polygraph examinations administered by CIA polygraphers as part of his routine security update. A computerized review the examination results indicated a .97 (out of 1.0) probability of deception on two questions: (1) Are you hiding involvement with a Foreign Intelligence Service? and (2) Have you had unauthorized contact with a Foreign Intelligence Service? During one of the examinations, a CIA polygrapher deemed NICHOLSON's response "inconclusive" to the following question: "Are you concealing contact with any Foreign Nationals?"
11. On or about December 4, 1995, NICHOLSON underwent a third polygraph examination administered by a CIA polygrapher. A computerized review of the examination revealed an .88 probability of deception on the following questions: (1) Since 1990, have you had contact with a Foreign Intelligence Service that you are trying to hide from the CIA? and (2) Are you trying to hide any contact with a Foreign Intelligence Service since 1990? The CIA examiner noted that NICHOLSON appeared to be trying to manipulate the test by taking deep breaths on the
control questions, which stopped after a verbal warning.
12. By reviewing CIA records and NICHOLSON's frequent flyer records and financial records from 1994 through early 1996, the FBI uncovered a pattern of twice yearly foreign travel, followed by unexplained deposits and payiments to NICHOLSON's accounts.
June, 1994 Meeting with Russian and Unexplained Money
13. According to CIA records, NICHOLSON was assigned to Kuala Lumpur, Malaysia during 1992-94 as Deputy Chief of Station/operations Officer. CIA records show that NICHOLSON met with an officer of the Russian intelligence service SVRR in Kuala Lumpur on four occasions during NICHOLSON's final months there; three of these meetings took place in the Russian Embassy in Kuala Lumpur. These meetings were authorized by the CIA and reported by NICHOLSON. On June 30, 1994, one day after NICHOLSON's last reported meeting with the SVRR officer, financial records show that $12,000 was wired into NICHOLSON's savings account #000026-1759/01 at Selco Credit Union, Eugene, Oregon. NICHOLSON left Kuala Lumpur on July 5, 1994, and returned to the United States. The FBI has been unable to trace the source of this money to any legitimate source of income.
December, 1994 Foreign Travel and Unexplained Money
14. According to NICHOLSON's travel records, NICHOLSON left the United States on personal travel on or about December 9, 1994. According to an itinerary he provided to the CIA,
NICHOLSON planned to travel to London, New Delhi, Bangkok and Kuala Lumpur. NICHOLSON left Kuala Lumpur on December 28, 1994, returning to the United States on December 30, 1994.
15. According to financial records, after arriving in Kuala Lumpur, NICHOLSON made a $9,000 wire deposit from Malaysia to his Selco checking account #000026-1759/10, and a $6,000 cash payment to his American Express account #3728-128689-71001. Almost immediately after returning to the U.S., on December 31, 1994, NICHOLSON entered the Selco Credit Union in Eugene, Oregon, and, using 130 $100 bills, paid off a $3,000 loan at Selco (Loan #86, Volkswagen), and paid $10,019.35 toward his Selco Visa account. The FBI has been unable to trace the source of the money in these transactions to any legitimate source of income.
June/July, 1995 Foreign Travel and Unexplained Money
16. CIA leave records show that NICHOLSON took annual leave from June 15, 1995 through July 14, 1995. According to an itinerary NICHOLSON provided to the CIA, NICHOLSON left the United States on June 16, 1995 for Singapore, then traveled to Kuala Lumpur, where he stayed from June 17 through July 1, 1995. NICHOLSON returned to the United States through Hong Kong on July 1, 1995.
17. Analysis of financial records created during and shortly after the trip show the following financial transactions totaling $23,815.21 involving accounts in the name of HAROLD J. NICHOLSON and joint accounts he holds with his children. The FBI
has been unable to trace these financial deposits and payments, which are set out below, to any legitimate source of income. Accounts marked with a '*' indicate accounts that NICHOLSON holds jointly with one of his children.
Date Amount Institution Account 6/21/95 $6,300 American Express 3728-128689-71001 6/30/95 $1,000 Selco Credit Union 000026-1759/20 Money market 6/30/95 $4,715.21 Selco Credit Union Visa 4202-51000-261-7591 6/30/95 $1,000 Selco Credit Union 000029-1248* 6/30/95 $1,000 Selco Credit Union 000034-2527* 6/30/95 $1,000 Selco Credit Union 000029-1249* 7/10/95 $1,000 Selco Credit Union 000026-1759/10 Checking 7/10/95 $1,000 Selco Credit Union 000026-1759/20 Money Market 7/17/95 $1,000 Central Fidelity 7922119540 7/17/95 $3,000 Central Fidelity 7922119540 7/20/95 $1,400 USAA Mutual Fund 52900-468973 7/20/95 $1,400 USAA Mutual Fund 54900-278125
December 1995 Foreign Travel and Unexplained Money
18. According to CIA leave records and NICHOLSON's travel records, NICHOLSON left the United States for personal travel on December 18, 1995, and arrived in Bangkok, Thailand on December 20, 1995. NICHOLSON stayed in Bangkok until December 24, 1995, when he left for Phuket, Thailand. NICHOLSON returned to the United States on December 30, 1995.
19. Analysis of NICHOLSON's financial records during and shortly after this trip show the following financial transactions involving accounts in the name of HAROLD J. NICHOLSON totaling $26,900 which the FBI has been unable to trace to any legitimate
source of income.
Date Amount Institution Account 1/3/96 $4,000 Central Fidelity 7922119540 1/3/96 $4,400 Central Fidelity 7922119540 1/4/96 $3,000 Central Fidelity 7922119540 1/5/96 $1,900 Central Fidelity 7922119540 1/8/96 $1,000 USAA Mutual Fund 52900-468973 1/8/96 $1,000 USAA Mutual Fund 54900-278125 1/11/96 $900 Central Fidelity 7922119540 1/16/96 $2,000 Central Fidelity 7922119540 1/17/96 $1,400 Central Fidelity 7922119540 1/22/96 $900 Central Fidelity 7922119540 2/6/96 $1000 Central Fidelity 7922119540
Meetings with Russians in Singapore and Cash Payment
20. On or about March 17, 1996, FBI officials were contacted by an SVRR liaison officer who asked for information about Chechnyan terrorism. The SVRR liaison officer added that his request was part of a global tasking by SVRR Headquarters to gather information about Chechnya.
21. On or about April 26, 1996, NICHOLSON traveled from his duty station at the CIA's Special Training Center to CIA headquarters in the Eastern District of Virginia. While at CIA Headquarters, he asked several CIA employees for background information about Chechnya; NICHOLSON claimed that he needed the information for a training exercise at the training facility. However, according to CIA officials at the training facility, training exercises ongoing at that time were developed months in advance, and no training was planned or conducted regarding
Chechnyan matters. Requests for changes to the exercises must be submitted to a board for review, and NICHOLSON did not submit any proposed changes.
22. According to CIA records, NICHOLSON left the United States on personal travel on June 25, 1996, arriving in Singapore on June 26, 1996. While NICHOLSON's checked luggage was searched and no evidence found, the FBI was unable to search NICHOLSON's carry on luggage, which included a camera bag.
23. At the time of his travel, NICHOLSON had applied for a position as CIA Chief of Station in a foreign country, and was being actively considered for that post.
24. Upon arrival in Singapore on June 26, 1996, NICHOLSON checked into the Garden Wing at the Shangri-La Hotel, where the cost of a room exceeds $300 per night.
25. Surveillance of NICHOLSON in Singapore on June 27, 1996, revealed that NICHOLSON left his hotel with his camera bag at approximately 10:11 a.m. for about four hours. During this four hour period, NICHOLSON made a "surveillance detection run," that is, a trip designed to detect surveillance. For example, NICHOLSON was observed taking numerous counter-surveillance measures, such as backtracking his steps, watching glass panels of shops to look behind him, then entering and immediately exiting a subway station. During this excursion, NICHOLSON made no purchases and took no photographs.
26. Surveillance of NICHOLSON later on June 27, 1996, in Singapore revealed that NICHOLSON left his hotel with his camera
bag at approximately 6:15 p.m., and retraced part of his route from earlier in the day, finally arriving at a subway station at 7:15 pm. NICHOLSON remained on the elevated area of the station until all other passengers had gone to the station's lower level. NICHOLSON then came down the escalator and sat on a stone seat at the end of the station near a taxi stand. After a few minutes, NICHOLSON got up and went back into the main concourse area of the station. While walking through the concourse area, he was met by a Caucasian male. The two men walked together toward a taxi stand. A car pulled up to the taxi stand. The trunk of the car opened, and NICHOLSON placed his camera bag in the trunk. NICHOLSON then got into the back seat of the vehicle. The vehicle bore diplomatic license plates which are registered to the Russian embassy in Singapore. The vehicle left the area. This meeting with Russian nationals was not authorized, nor did NICHOLSON report it to the CIA as required by agency regulations.
27. The next morning, on or about June 28, 1996, surveillance detected NICHOLSON leave his hotel and go to an American Express Travel Services Center in Singapore, where he made an $8,300 cash payment to his American Express account. Several days later, NICHOLSON left Singapore for Bangkok, paying his $1,679.59 bill in cash.
28. On or about July 2, 1996, NICHOLSON left Bangkok for Honolulu with a female companion. In an August 21, 1996, letter to the CIA, NICHOLSON identified this woman as a foreign national currently residing in Thailand whom he intends to marry.
According to a receipt found in a car search described below, NICHOLSON made a $762.93 cash payment to the Hanalei Bay Resort in Hawaii on July 5, 1996.
29. Records of NICHOLSON's financial transactions during and immediately after this Singapore trip reveal approximately $20,000 in purchases, deposits and payments. In addition, electronic surveillance has detected a telephone conversation between NICHOLSON and an acquaintance indicating that NICHOLSON gave his son approximately $12,000 to purchase a new car. I have seen a cash receipt found in HAROLD J. NICHOLSON's van dated July 12, 1996, issued to his son for $12,377.50 cash.
Date Amount Institution Account 6/28/96 $8,300 American Express 3728-128689-71001 7/l/96 $820. 58 Overseas Union Bank purchase gold coins 7/l/96 $1,679.59 Shangri La Hotel 7/5/96 $762.93 Hanalei Bay Resort 7/8/96 $1,000 Selco Credit Union 000029-1248* 7/8/96 $1,000 Selco Credit Union 000034-2527* 7/14/96 $120 Dulles Airport Parking 7/29/96 $5,000 Selco Credit Union 000026-1759/10
NICHOLSON's Move to CIA Headquarters
30. On or about July 16, 1996, NICHOLSON reported to his new position at CIA Headquarters in the Counterterrorism Center. NICHOLSON had applied for several foreign postings, including the Chief of Station position discussed in paragraph 20 above, all of which were denied.
31. On or about July 19, 1996, an audit of CIA computer information revealed that NICHOLSON was using his coraputer to conduct searches in CIA databases for information using the following key words: "Russia[n]" and "Chechnya." As a result of NICHOLSON's use of these key words to conduct searches, CIA cables, reports, and documents containing either of those key words would be routed to his computer where he could read them and print them. According to CIA officials, NICHOLSON has no need for such materials in his present position. The audit also revealed that NICHOLSON attempted to access CIA databases that he had no authorization to access, including two attempts to access Central Eurasian Division databases which would contain information on Russia. This unauthorized activity led the CIA computer security personnel to list NICHOLSON as a "surfer."
32. On or about August 1, 1996, surveillance detected NICHOLSON approach a mailbox at 8283 Greensboro Drive, Tyson's Corner, in the Eastern District of Virginia. A sealed Hallmark greeting card envelope containing a postcard was subsequently retrieved from the mailbox. A return address of 2206 Pimmit Run, Falls Church, 22041 was hand printed on the envelope. Both the envelope and the postcard carried oversized commemorative stamps with a face value of $1, an amount in excess of the necessary postage. The postcard, which was addressed to a post office box in a foreign country, contained the following text:
1 Aug 96
Dear J. F.,
Just want to let you know that unfortunately I will not be your neighbor as
expected. Priorities at the home office resulted in my assigrment to the management
position there. Some travel to your general vicinity to visit field offices will occur,
but not for more than a few days at a time. Still, the work at the home office should
prove very beneficial - I know you would find it very attractive. I look forward to a
possible ski vacation this winter. Will keep you informed. Until then, your friend,
Nevil R. Stratchey
P.S. I am fine.
33. Investigation at 2206 Pimmit Run, Falls Church, Virginia, revealed no one at this address named Nevil R. Strachey. The zip code 22041 is not accurate for 2206 Pimmit Run, Falls Church. No listing for Nevil R. Strachey was found in telephone directories for Northern Virginia, the District of Columbia, Prince George's and Montgomery County (MD).
34. Based on my experience, I believe the foreign post office box to which the postcard was mailed is an "accommodation address." An accommodation address is a prearranged address where an intelligence officer can receive mail clandestinely from an agent. The accommodation address itself may be serviced by an intermediary. This post office box appears to be the method that NICHOLSON uses to communicate with his SVRR handlers. The contents of the postcard appear to inform the SVRR that NICHOLSON did not get the particular Chief of Station foreign posting that
he had sought, but instead got a management position at CIA headquarters.
Classified Documents Recovered froyn NICHOLSON's Notebook Computer
35. On or about August 11, 1996, the FBI conducted a search of a 1994 Chevrolet Lumina Sports Van which is registered to NICHOISON; surveillance and DMV records confirm that this is NICHOLSON's only vehicle. in addition to cash receipts confirming some of the above financial transactions, the FBI discovered a personally-owned notebook computer in the van. An analysis of the hard drive showed that it contained numerous CIA classified documents relating to Russia. All of these files had been deleted from program directories, which in my training and experience indicates that they have already been copied onto a disk and transmitted to Russian intelligence. This is corroborated by the fact that the original classified documents are all dated prior to NICHOLSON's June, 1996 trip to Singapore. While the files had been deleted, the FBI recovered certain files and fragments of files from the notebook computer's hard drive. A brief summary of some of these documents follows:
a. A fragment recovered by the FBI describes the planned assignment of a CIA officer to a position in Moscow. NICHOLSON trained this officer at a CIA training facility. The text of the fragment includes the statement "(Comment: Please see biographic profile prepared previously on [name of officer] as well as updated assignment listings provided separately." According to
the CIA, information about this officer's assigrment was classified "Secret." The assignment was intended to be a covered slot, and the officer was trained in the use of a full range of intelligence collecting techniques. Collection targets included, but were not limited to, military preparedness of the Russian Federation, the Russian Federation's knowledge of U.S. national defense plans, and other important foreign intelligence and counterintelligence matters. The disclosure of this officer could have led to the losses of human sources and caused serious damage to U.S. intelligence capabilities.
Further, the fragment indicates that NICHOLSON has provided the SVRR with biographic information and assignment listings of CIA case officers. This is confirmed by the fact that the hard drive also contained biographic and assignment information about CIA employees who were at the training facility during NICHOLSON's tenure there.
NICHOLSON's position as a staff instructor at the CIA's Special Training Center gave NICHOLSON access to highly sensivtie information, including access to the biographic information and assignments for every CIA case officer trained during his two year tenure there. As a result of this disclosure, it will be difficult, if not impossible, for the CIA to place some of these newly trained case officers into certain sensitive foreign postings for the rest of their careers. Further, NICHOLSON communicated with other case officers who were instructors at the center, and may have heard descriptions of their work as part of
training. The methods of training, and the techniques taught to future case officers, would be valuable information for foreign intelligence agencies.
b. A document concerning a closed briefing on Russian recruitment pitches to CIA case officers in the field. A CIA official has told the FBI that there was a briefing concerning recruitment pitches by Russian intelligence officers and that the briefing was classified "Secret." A CIA official said that information concerning how many recruitment pitches have been reported by CIA officers to CIA headquarters is classified "Secret."
c. A document concerning information on Chechnya. The information was a near verbatim copy of an actual "Secret" CIA report regarding Chechnya that had been provided to NICHOLSON by CIA officials. I believe that NICHOLSON gathered the Chechnyan information found on his computer in response to clandestine tasking from the SVRR, consistent with the SVRR's global tasking for such information as discussed above in paragraph 20.
d. A document which included the statement "The following added notes were taken by me from the secret report from the CIA's Paris accountability review team, dated 16 June 1995...." According to a CIA official, the notes contained in the electronic document came from a "Secret" CIA report dated June 16, 1995 regarding expulsions of CIA officers from Paris.
e. A document regarding information about the Moscow CIA Station. The document gave the name of the new Chief of Station,
and set out staffing information for this CIA office. CIA officials advised that information concerning the location and staffing of any CIA Station is classified "Secret." Based on my experience I know that the Russian intelligence services attempt to identify U.S. intelligence officers to identify CIA intelligence operations and confidential human assets, some of whom report on the military intentions and military preparedness of foreign powers.
f. A document summarizing information obtained during the debriefing of convicted spy Aldrich Ames.
g. An extended description of NICHOLSON's polygraph examination, focusing on the questions NICHOLSON had been asked about any unauthorized contact with a foreign intelligence service and the CIA polygrapher's reaction to the test.
36. A 3.5 inch computer diskette was also found in the search of the vehicle. Unlike the hard drive, it contained an electronic document that had not been erased titled "SUBJECT: REPORTING FROM ACCESS AGENTS TO RUSSIAN SOURCES AND DEVELOPMENTALS." Access agents are individuals who are not employed by the federal government. Instead, they are individuals who work in a variety of private fields who, by the nature of their work, often travel and gain valuable intelligence information. These individuals voluntarily provide this information to the United States. The identity of these assets is classified, as they could be the target of reprisals if foreign countries were aware of their intelligence gathering
activities.
The access agent document contained seven summary reports concerning CIA human assets and their confidential reporting on foreign intelligence matters. The document noted: "(Comment: The following was gleaned from reporting accessions lists on Russian objectives.)" The topics included intelligence information concerning the Russian banking system, efforts of a foreign country to acquire Russian cruise missile technology, acquisition of Russian designed electric field suppression systems of interest to the U.S. Navy, sound-vibration insulation for diesel generator plants, high frequency radar research, submarine weapons systems designs, and information concerning the Russian economy. In addition, the human sources of information, whose identities the CIA seeks to protect from disclosure, were identified in the document by their codenames, positions, and access to particular information.
CIA officials told the FBI that the seven items were all apparent extracts from three actual CIA documents, each dated July 18, 1996, and classified "Secret." A CIA official who examined the extracts said that the information contained in the extracts was classified "Secret" and consisted of Russian matters selected from a broader compilation of CIA headquarters comments to three CIA Stations concerning reporting by CIA assets of those CIA Stations. The "Comment" reported above was not found in the text of any of the three CIA documents.
37. Based on my experience, I know that agents of foreign
intelligence services collect information on computers and transfer the information on diskettes. I know that classified CIA intelligence information concerning staffing in Moscow; reports from CIA assets about Russian banking, technology, and political information; and information about the number of Russian recruitment pitches reported by CIA officers is valuable intelligence information which is being sought by the Russian intelligence services, particularly the SVRR. Much of the information on the hard drive and the disk relates to the national defense of the United States.
38. On or about August 24, 1996, a search of NICHOLSON's safe deposit box #417 at Selco Credit Union in Springfield, Oregon, revealed a number of gold and commemorative coins, including the two gold coins NICHOLSON purchased in Singapore with cash on July 1, 1996.
NICHOLSON's Planned Meeting with Russians in November, 1996
39. On or about September 23, 1996, electronic surveillance at NICHOLSON's workplace in Langley, Virginia revealed NICHOLSON removing a camera from his desk and holding it above papers on his lap, as if he were trying to photograph documents. NICHOLSON had requisitioned this camera and lenses from the CIA. Later, NICHOLSON asked for a camera that folds down into a briefcase; in my experience, this style camera is useful in photographing documents. According to CIA officials, NICHOLSON has no need for any camera in connection with his current official duties.
40. On or about October 4, 1996, NICHOLSON made plans to travel to two foreign locations for official meetings with friendly foreign intelligence services, departing on November 16, 1996, and returning to the U.S. on November 26, 1996. NICHOLSON has informed travelling companions from the CIA that he plans to travel to Switzerland after the official meetings rather than return to the U.S. with them. NICHOLSON has made reservations to fly to Zurich, Switzerland.
41. On or about October 9, 1996, FBI surveillance observed NICHOLSON deposit an item in a mailbox at Gallows Road and Electric Avenue, Dunn Loring, Virginia. The FBI retrieved the item, a sealed airmail envelope which contained a postcard mailed to the same address and same foreign post office box as the August 1, 1996, postcard. Both the envelope and the postcard carried the same oversized commemorative style stamps with a face value of $1 as used on the August 1, 1996 postcard. The text of the postcard reads:
Hello Old Friend,
I hope it is possible that you will be my guest for a ski holiday this year on 23-24
November. A bit early but it would fit my schedule nicely. I am fine and all is well.
Hope you are the same and can accept my invitation.
Best Regards,
Nevil R. Strachey
P.S. The snow should be fine by then.
42. Based on my training and experience, I believe that NICHOLSON was informing an SVRR intelligence officer of his intention to meet in Switzerland on November 23 and November 24,
1996. I believe that the reference to "a bit early" refers to the fact that their prior semi-annual meetings have occurred in December.
43. On or about October 23, 1996, the FBI conducted a surreptitious search of NICHOLSON's residence. This search was very limited in that the FBI had little time to perform the search, and had to leave no trace of their entry or the search. Most of the search focused on NICHOLSON's home and notebook computers, which revealed no new evidence. The search revealed that NICHOLSON keeps his notebook computer in his bedroom, and electronic surveillance has detected the sounds of typing in the bedroom at night. The search also revealed that NICHOLSON has an electronic document scanner at home which would enable him to scan documents onto a computer disk.
44. On or about November 3, 1996, FBI agents conducted a search of NICHOLSON's office in Langley, Virginia. Approximately 40 documents relating to Russia were found on his desk, including documents classified at the "Secret," "Top Secret," and "SCI" levels. According to CIA officials, these documents contained information concerning, among other things, the intelligence capabilities and military preparedness of the Russian Federation. The documents do not appear to be germane to Counterterrorism Center matters. Many of these documents relate to the national defense of the United States. The majority of these documents was located in a black folder on his desk.
45. Unlike his computer at previous CIA assignments,
NICHOLSON's computer at Langley has no disk drive. This security feature makes it impossible for anyone to copy classified documents onto a disk for editing, removal or transfer.
46. On or about November 9, 1996, electronic surveillance of NICHOLSON's workspace revealed NICHOLSON removing documents from the black folder on his desk, and removing classification markings from the tops and bottoms of documents. I believe that the no disk drive security feature of NICHOLSON's computer is forcing NICHOLSON to print out these documents and edit them by hand.
47. On or about November 12, 1996, in response to NICHOLSON's request, individuals from the CIA's Office of Technical Services delivered a document camera to NICHOLSON's office. Immediately, NICHOLSON closed his door and placed the camera under his desk. NICHOLSON took some of the documents relating to Russia from the black folder, placed them under the desk, knelt on the floor, and began photographing the documents. NICHOLSON photographed documents for about 30 minutes on the morning of November 12, 1996. Surveillance detected NICHOLSON photographing documents under his desk later that same evening, and on the morning of November 13, 1996.
48. According to a Personal Financial Statement that HAROLD J. NICHOLSON signed and filed with the CIA in 1995, NICHOLSON has no outside business interests or sources of income that account for the income described in connection with his foreign travel. His federal tax returns for the 1994 and 1995 tax years do not
appear to declare the income described above that NICHOLSON has deposited into his accounts or used to pay debts.
49. Based on the above information, there is probable cause to believe that NICHOLSON is engaged in a conspiracy to commit espionage in violation of Title 18, United States Code Section 794 (c).
50. Based on my experience and training and my discussions with other agents experienced in this field, I know that:
a. Agents of foreign intelligence services maintain national defense and classified documents and materials, clandestine communications devices and instructions, contact instructions, codes, telephone numbers, maps, photographs, other papers and materials relating to communications procedures, proceeds of illegal espionage transactions, records, notes, bank records, financial statements, calendars, journals, and other papers or documents relating to:
1) the transmittal of national defense and classified intelligence information to foreign governments and intelligence services;
2) the identities of other foreign espionage agents and intelligence officers;
3) financial transactions including payments from foreign governments and hidden financial accounts;
4) records of previous illicit espionage transactions; and,
5) the source and disposition of national defense and classified intelligence information.
b. Agents of foreign intelligence services often utilize espionage paraphernalia, including devices designed to conceal and transmit classified and intelligence information. These paraphernalia and devices include materials used by espionage agents to communicate between each other and with a foreign goverrment, such as computer disks or photographic film.
c. It is common for agents of foreign intelligence services to secrete national defense and classified documents and materials, clandestine communications devices and instructions, contact instructions, codes, telephone numbers, maps, photographs, other papers and materials relating to communications procedures, proceeds of illegal espionage transactions, records, notes, bank records, financial statements, calendars, journals, espionage paraphernalia, and other papers or documents on their persons and in secure, hidden locations and compartments within or near their residences, at places of employment, in safe deposit boxes, and in motor vehicles, including hidden compartments within motor vehicles, for ready access and to conceal such items from law enforcement authorities.
d. Agents of foreign intelligence services routinely maintain or conceal in and near their residences or in safe deposit boxes large amounts of U.S. and foreign currency, financial instruments, precious metals, jewelry, and other items
of value and/or proceeds of illegal espionage transactions. They also conceal records relating to hidden foreign and domestic bank and financial accounts, including accounts in fictitious names.
e. Agents of foreign intelligence services are not unlike any other individual in our society in that they maintain documents and records. These documents and records will normally be maintained for long periods of time regardless of whether their value to the agent has diminished. These persons maintain documents and records which will identify and corroborate travel both in the U.S. and abroad made in connection with clandestine espionage activity, including personal meets with foreign intelligence officers. These documents and records include passports, visas, calendars, journals, date books, telephone numbers, address books, credit cards, hotel receipts, airline records, correspondence, carbon copies of money orders and cashier's checks evidencing large cash expenditures, and accounts and records in fictitious names.
f. Agents of foreign intelligence services often maintain and conceal identity documents, including those utilizing fictitious identities, U.S. and foreign currency, instructions, maps, photographs, U.S. and foreign bank account access numbers and instructions, and other papers and materials relating to emergency contact procedures and escape plans.
51. I plan to participate in an arrest of NICHOLSON on November 16, 1996 at Dulles Airport in the Eastern District of
Virginia just prior to his scheduled departure. In his past travel, NICHOLSON has checked luggage with the airline and also carried hand luggage, including a camera bag, onto the airplane. Based on the above information, there is probable cause to believe that NICHOLSON will have classified information in some form on his person or secreted in his luggage for delivery to his SVRR handlers. Accordingly, should NICHOLSON check any items with the airline for transportation with his flight, or should he have any carry on items prior to boarding the aircraft, I ask for authority to search these items.
52. I have seen NICHOLSON driving his Chevrolet Lumina Sport Van, blue grey in color, license plate 8888BAT, Vin No.lGNDU06D9RT148988.
53. I have seen NICHOLSON's residence at 5764 Burke Towne Court, Burke, Virginia, in the Eastern District of Virginia. it is a three story cream colored townhouse with beige trim. It is an end unit attached to a townhouse on one side, and with brick on the lower portion of the unattached side. The numbers 5764 are located on the door frame on the upper right side, just below the outside light fixture. The door is a brown-grey color, with a brass knocker.
54. I have seen NICHOLSON's office at CIA Headquarters in Langley, Virginia. It is located in the Old Headquarters Building on the sixth floor in the northwest section of the building, room 6E2911. There are two private offices within room 6E2911. As you enter room 6E2911, the two private offices are
side by side directly across the room. NICHOLSON's office is the office on the right.
55. Based on the facts and circumstances stated herein, I believe there is probable cause that evidence, fruits, instrumentalities, and proceeds of these offenses, as described in paragraph 50, above, and as further described in ATTACHMENT C, are located in:
a. Premises known and described as a residence at 5764 Burke Towne Court, Burke, Virginia.
b. Premises known and described as Room 6E2911, CIA Headquarters, Langley, Virginia;
c. One 1994 Chevrolet Lumina Sport van, bearing Virginia license plate 8888BAT, VIN: 1GNDU06D9RT148988, presently located in the Eastern District of Virginia;
d. Luggage or other items that NICHOLSON checks with an airline in connection with his November 16, 1996 flight, or carry on items that NICHOISON has in his possession at the airport before boarding that flight;
e. One safe deposit box, number 417, maintained at Selco Credit Union at 925 Harlow Rd., Springfield, Oregon, in the name of HAROLD J. NICHOLSON.
56. Based on my experience, I know that persons who have committed serious felonies, particularly those felonies with authorized punishments of death or incarceration for any term of
years or life, often will attempt to destroy evidence, fruits, and instrumentalities of their crimes if alerted prematurely to law enforcement interest. I also know that foreign intelligence services, including the SVRR, are able to communicate prearranged "danger" signals to their agents to alert them to destroy evidence, fruits, and instrumentalities, as well as to execute emergency escape plans. These intelligence services, and in particular the SVRR, actively seek to penetrate U.S. intelligence and law enforcement agencies by technical and human means. As a result, law enforcement interest could be detected at any time and it may be necessary to execute a search warrant during night time hours in order to preserve evidence, fruits, and instrumentalities of espionage from destruction.
57. I ask that this affidavit and the accompanying complaint, applications, and warrants be placed under seal until the defendant's initial appearance on Monday, November 18, 1996, or further order of this Court. Disclosure of these documents before arrest and execution of the search warrants could cause NICHOLSON to destroy evidence and flee the country.
58. The above facts are true and correct to the best of my knowledge and belief.
Michael Lonergan
Special Agent
Federal Bureau of Investigation
Sworn to and Subscribed
Before me this 15th day
of November, 1996
UNITED STATES MAGISTRATE JUDGE
Alexandria, VA
List of Items to be Seized
Items to be searched for and seized:
1. national defense and classified documents and materials, clandestine communications devices and instructions, contact instructions, codes, telephone numbers, maps, photographs, other papers and materials relating to communications procedures, proceeds of illegal espionage transactions, records, notes, bank records, financial statements, calendars, journals, and,4>ther - papers or documents relating to:
a. the transmittal of national defense and classified intelligence information to foreign governments and intelligence services;b. the identities of other foreign espionage agents and intelligence officers;
c. financial transactions including payments from foreign governments and hidden financial accounts;
d. records of previous illicit espionage transactions; and,
e. the source and disposition of national defense and classified intelligence information;
2. espionage paraphernalia, including devices designed to conceal and transmit classified and intelligence information. These paraphernalia and devices include materials used by espionage agents to communicate between each other and with a foreign government;
3. large amounts of U.S. and foreign currency, including commemorative coins, financial instruments, precious metals, jewelry, other items of value and/or proceeds of illegal espionage transactions, records relating to hidden foreign and domestic bank and financial accounts, including accounts in fictitious names;
4. documents and records which will identify and corroborate travel both in the U.S. and abroad made in connection with clandestine espionage activity, including personal meets with foreign intelligence officers, passports, visas, calendars, journals, date books, telephone numbers, address books, credit cards, hotel receipts, airline records, correspondence, carbon copies of money orders and rashier's checks evidencing large cash expenditures, and accounts and records in fictitious names;
5. .identity documents, including those utilizing fictitious identities, U.S. and foreign currency, instructions, maps, photographs, U.S. and foreign bank account access numbers and instructions, and other papers and materials relating emergency contact procedures and escape plans;
6. foreign and domestic bank records, including canceled checks, monthly statements, deposit slips, withdrawal slips, wire transfer requests and confirmations, account numbers, addresses, signature cards, credit cards, and credit card statements, and all other financial statements;
7. safety deposit box records, including signature cards, bills, and payment records;
8. financial and investment account records, including statements, investment confirmations, withdrawal and dividend records, and all other related account records;
9. federal, state, and local tax returns, worksheets, W-2 forms, W-4 forms, 1099 forms, and all related schedules;
10. records concerning real property purchases, sales, transfers in the U.S. and foreign countries, including but not limited to deeds, deeds of trust, land contracts, promissory notes, settlement papers, and mortgage documents;
11. records relating to conveyance purchases and sales;
12. computer hardware and software, including but not limited to central processing units, hard drives, monitors, keyboards, storage media, printers, modems, diskettes, and manuals; and other electronic storage media including telephone caller ID devices, and pocket wizards;
13. cameras and photographic film.