HIGH LINK SEEN IN CAIRO SPY CASE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90G01353R001500230055-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 6
• Document Creation Date: December 27, 2016
• Document Release Date: September 4, 2013
• Sequence Number: 55
• Publication Date: August 20, 1988
• Content Type: OPEN SOURCE

t Declassified in Part - Sanitized Copy Approved for Release 2013/09/11: CIA-RDP90G01353R001500230055-5
Mee of Current Production and Analytic Support
:IA Operations Center
e? Bulletin
?
THE WASHINGTON POST 20 AUGUST 1988
FRONT PAGE ITEM NO. 1
High Link
Seen in Cairo
Spy Case
References Heard
To Defense Minister
By Patrick E. Tyler
Washington Post Foreign Service
CAIRO, Aug. 19?An alleged
quest by Egyptian agents in the
United States to illegally acquire
advanced U.S. missile technology
for shipment to Cairo, which re-
sulted in three arrests in June, may
be linked to Egypt's powerful de-
fense minister, Field Marshal Ab-
dul-11Am Abu Ghazala, according
to a U.S. official.
- The linking of Abu Ghazala to the
operation is said to be based on in-
terpretation of intercepted tele-
phone conversations in which ref-
erences to "the minister" are used
by other Egyptian military officers
involved in the alleged plot as a way
to expedite shipment.
Sources close to the case also
report that at one point last May
the scheme was disrupted for a
while by a mysterious car bombing
in France that the Egyptian oper-
atives took as a violent response to
their activities by Israel's intelli-
gence service.
The alleged plot, which has com-
plicated U.S.-Egyptian relations,
ABDUL-HALIM ABU GHAZALA
... supporter of strong U.S. ties
apparently was born in the months
immediately before an official visit
to Washington last March by the
defense minister. During the visit,
Abu Ghazala, a supporter of strong
ties wlhe United States, signed
a 10-ye ? "memorandum of under-
standing' with Defense Secretary
Frank C. Carlueci giving Egypt?
like Israel, Australia and Sweden?
special status as a strategic ally out-
side of the North Atlantic Treaty
Organization.
An official familiar with the cur-
rent criminal investigation into the
matter said this week that senior
State Department officials regarded
the case as so sensitive that they
persuaded Justice Department of-
ficials to delete all references to
_ ?
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High Egyptian Link Seen in Attempt to
? SPY, From Al Eltayeb Helmy, and James Huff-
Abu Ghazala and his office from a
36-page investigative summary
filed publicly in U.S. District Court
in Sacramento, Calif.
State Department officials took
the position, according to an official
close to the case, that unless the
Justice Department had evidence
strong enough to hold up in court
and was prepared to indict Abu
Ghazala,. U.S.-Egyptian relations
should be spared the embarrass-
ment of public references in court
documents to the authority of "the
minister."
- A State Department official cle-
aned to comment.
" The Justice Department spokes-
'Man, Patrick Korten, declined to
comment specifically on this case
but said "any time the department
undertakes a case that has diplo-
ina6c or international aspects to it,
ive consult with the State Depart-
pent. But the final decisions on
what to include in any indictment or
how to procede with an investiga-
tion or prosecution are entirely our
dcisions to make and are made
rd on the law and Justice De-
ment guidelines for federal
prosecutions."
, 'Asked for comment on the con-
lent of this article, a spokesman for
Egypt's Defense Ministry criticized
this newspaper for airing issues
that are "still under investigation in
both Egypt and the United States,"
and he pointed out that "legal doc-
..uments in both Egypt and the Unit-
ed States have not made the slight-
est mention" of any alleged involve-
j_nent by the defense minister.
? The spokesman defended lower-
ranking Egyptian officers involved,
saying their actions amounted to
"nothing more than a procedural
mistake of neglecting to obtain ex-
port license for a material that can
be purchased on the open market in
the United States, and which- is
used in nonmilitary fields besides
the military domain."
He said the Egyptian government
"has stated its complete willingness
tosooperate" in the U.S. investiga-
tion.
Two Egyptian military officers.
. one of them attached to Egypt's
slambassy in Washington, were
med in a criminal complaint filed
une 23 in U.S. District Court in
Sacramento, Calif., alleging that
they conspired with an Egyptian-
born U.S. rocket scientist, Abde-
lkadr Helmy, and other Egyptian
. agents to violate U.S. export-con-
trol laws. Helmy, his wife, Albia
man, an aerospace company em-
ployee, were arrested.
The operation was alleged to
have been directed on a day-to-day
basis by a Col. Hussam Yossef, who
used a telephone and a facsimile
machine, U.S. officials said, to run
his American-based agents and sup-
ply them with long shopping lists
for rocket-fuel chemicals, propul-
sion hardware, telemetry tracking
equipment and assembly plans that
one defense analyst described as "a
complete package to build or up-
grade a tactical missile system."
Among the sensitive material
they allegedly tried to spirit out of
the country on Egyptian military
cargo planes was 432 pounds of
"carbon-carbon" fiber matting,
which can be used as a protective
coating for ballistic missile war-
heads and rocket motor nozzles and
as a radar-absorbing outer layer for Egypt a missile-warhead delivery
"stealth" aircraft?planes shielded capability rivaling that of Israel,
to make them difficult to detect whose powerful Jericho II is re-
electronically. garded as the most formidable sur-
An official familiar with the inves- face-to-surface weapon in the re-
tigation said intercepted commu- gion.
nications indicate the Egyptian-di- This case of purloined technol-
rected group was planning this sum- ogy?filled as it is with the dramat-
mer to export 30 tons of U.S.-made ic elements of espionage that have
rocket-fuel compounds, half of them characterized similar cases involv-
closely controlled under U.S. export ing Israel in recent years?also il-
laws, and the first 40 sheets of mil- lustrates the intense arms race un-
itary-grade steel along with special derway in the Middle East, where
forgings that would give an Egyp- regional tensions and battlefield
tian rocket plant the capability to experience in the Iran-Iraq .war
bend and weld large rocket motor have sparked interest in acquiring'
casings. The group planned to in- powerful surface-to-surface missiles
crease this order of high-nickekon- as strategic weapons capable of ter-
tent "maraging steel" to 400 sheets, rorizing distant enemy capitals.
some of which were to be sent to Western intelligence officials also
Iraq's missile program, the official fear the Iran-Iraq conflict has gen-
said. erated similiar interest by regional
The Egyptian Defense Ministry states in producing and stockpiling
spokesman said there was "no re- chemical weapons. This fear has
ality" to the assertions about the prompted U.S. Defense Depart-
fuel compounds or steel ment analysts to closely reexamine
U.S. Defense Department ana- an otherwise routine proposal by a
lysts, who are assisting federal Canadian firm to sell Egypt an un-
prosecutors in the case, have said disclosed quantity of fumigants,
that it appeared Helmy was helping pesticides, arsenic and strychnine
the Egyptian government in a bid to compounds for what was described
manufacture an Egyptian version of as a "pest control" program at the
the Pershing II missile propulsion big Beni Suef Air Base south of Cai-
system. to.
Engineering drawings from the "There is a bunch of analysis un-
West German defense contractor derway right now to determine
Messerschmidt and from an Italian whether or not that stuff could have
firm, both licensed by the U.S. gov- been used as precursors for nerve
ernment to manufacture Pershing II gas production . . . or whether it
propulsion system components, might have been a legitimate thing
were seized by U.S. Customs offi- to try to gas rats," said one official.
cers from Helmy's office, according The Egyptian official denied that
to the official familiar with the in- his government had proposed such
vestigation. , a purchase.
The Pershing II has a range of up The material linking Abu Ghazala
to 1,000 miles and would give to the operation is based primarily
Acquire U.S.
Techno1ogT1
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?
on two telephone conversations in-
tercepted and translated from Ara-
bic by U.S. officials in which Egyp-
tian Col. Hussam Yossef, who su-
/ pervised He!my's acquisition work
from Austria, interceded to expe-
dite the handling of several tons of
illegal rocket-fuel cargo by the
Egyptian military attache's office in
Washington. The office is under the
0 direct control of Abu Ghazala, ac-
cording to U.S. officials.
An official familiar with the tran-
scripts of these conversations,
which are not yet part of the public
record in the case, gave the follow-
ing account:
On June 1, Helmy telephoned
Rear Adm. Abdel-Rahim Elgohary
and discovered that the admiral, a
senior procurement official in the
Egyptian military office in Washing-
ton, was reluctant to ship the rock-
et-fuel compounds. Helmy prodded
the admiral by reminding him that
"when he, the minister, was here
during the month before last," there
were discussions about "things that
are controlled and cannot be ex-
ported." Helmy referred to the
then-pending shipment of rocket-
fuel compounds and said, 'Both
items were banned from being ex-
ported and we acquired them
through our own ways or channels
and you know that very well."
When the admiral complained
that "I didn't expect to receive ma-
terial that weighed six or seven
0 tons from you," Helmy responded,
"I understand that, he, the minister,
wants the cargo shipped no matter
what, that is what we were told and
you will arrange for the shipment
on the airplane that . . . usually
? leaves for Cairo."
When Helmy encountered fur-
ther resistance from the admiral,
Helmy telephoned his alleged "con-
troller" in Austria. Helmy explained
to Col. Yossef that "the man" in the
Washington office was going to
bring harm to the operation by
openly discussing the problem of,
among other things, export li-
censes. In apparent frustration,
Helmy told his supervisor, "The
items are controlled and cannot be
exported outside the United
States. ... If they knew that I am
buying it to export it, I'd be thrown
in jail."
Yossef, who was named as a de-
fendant in the U.S. criminal com-
plaint and whose current where-
abouts are unknown to U.S. offi-
cials, told Helmy on June 1 that he
would call the reluctant admiral.
Two days later, US. officials in-
tercepted a telephone call from
Yossef to Helmy reporting on the
resolution of the conflict.
"I told him, 'I'm calling you from
the ministry in order to deliver you
a message from our father and from
our grandfather, who was at your
end earlier regarding Dr. Abdelkadr
[Helmy),' Yossef reportedly said.
Investigators believe the reference
to "our father and . .