WASHINGTON-CIA officials last week were expected to appear before a federal grand jury here in connection with new revelations that intelligence officials may have broken the law by contacting Hughes Electronics Co. about the Senate Intelligence Committee’s probe of high-tech exports to China, which the Pentagon now says compromised U.S. national security.
The Pentagon’s findings are included in a joint report from Air Force Intelligence and the Defense Technology Security Administration.
A State Department report on the same matter is expected to be released shortly, though it is not known whether the conclusions will coincide with Defense’s.
The CIA twist adds to the ongoing controversy over whether Hughes, Loral Corp., Motorola Inc. and other firms transferred sensitive technology abroad-unwittingly or otherwise-by using Chinese and Russian rockets to launch U.S.-made commercial satellites into space.
“The agency is cooperating fully with the [Department of Justice] investigation,” said Tom Crispell, a CIA spokesman.
The Justice Department declined to comment.
Calls to Hughes and the Pentagon were not returned.
There is a dispute among the parties over whether the Senate Intelligence Committee gave the CIA permission to get in touch with Hughes-a longtime satellite supplier to the spy agency and a major wireless telecom infrastructure vendor.
CIA officials, according to news accounts, were prepared to testify they had tacit approval from Senate staffers to notify Hughes about questions being asked in the Senate investigation of high-tech exports to China. Senate staffers reportedly claim they were considering the request when the CIA went ahead and contacted Hughes.
American satellite firms depend on China, Russia and other countries for space launches because it is cheaper and faster than launching options in the United States. Legislation is expected to be offered next year in Congress to foster commercial space launches in the United States.
The Justice Department and the GOP-led Congress have several probes under way to determine whether any laws were violated in the sharing of information between U.S. satellite companies and Chinese officials.
The Clinton administration is divided on the issue. Commerce officials say they doubt U.S. high-tech exports to China helped China improve its nuclear missile capability.
But some in the Defense Department believe otherwise.
The Washington Post quoted an administration official on the Pentagon’s latest findings as concluding Hughes “went well beyond what should have been allowed” by U.S. agencies responsible for overseeing exchanges of technology information between U.S. firms and China.
The New York Times, meanwhile, quoted an administration official as saying what China learned from Hughes “could be directly applicable to military systems, although we have no information that it has been.”
For now, investigators appear most focused on Hughes and Loral.
The alleged Hughes technology transfer in question came in the aftermath of a 1995 explosion of a Chinese rocket that carried a Hughes commercial satellite.
A post-crash investigation into the cause of the mishap was tied in part to insurance considerations.
Hughes has come under scrutiny for heavy-handed lobbying of the Clinton administration by C. Michael Armstrong, who ran Hughes before taking the helm at AT&T Corp.
Armstrong helped get dual-use technology export oversight shifted from the cautious-minded State Department to the trade-minded Commerce Department.
However, congressional Republicans reversed the policy last Congress by returning primary high-tech export jurisdiction to State.
Adding fuel to the fire are lingering allegations that contributions from China and elsewhere in Asia were illegally funneled into to the 1996 Clinton-Gore re-election campaign to the detriment of U.S. economic and national security.
Indeed, the launch of Loral Globalstar satellites on Soyuz rockets from Kazakhstan was delayed until an agreement is reached by U.S., Russian and Kazakh officials on a “Technology Safeguard Agreement” to prevent sensitive U.S. technological know-how from being expropriated by the Kazakhs.
Barring any glitches, Loral plans to launch 32 satellites in July 1999 and 52 satellites in December 1999. In September, Globalstar lost 12 satellites in a launch accident in Kazakhstan.
A select House committee, chaired by Rep. Christopher Cox (R-Calif.), will send a report to Congress Jan. 2 on its months-long investigation into U.S. high-tech exports to China.
It is less clear where the Senate Intelligence Committee is headed.
