Decades of Spying

How US Weapons Grade Uranium Was Diverted to Israel

Declassified GAO report exposes fatally flawed Israel investigations

By Grant Smith

The 2010 Review Conference of the Treaty on the Non-Proliferation of Nuclear Weapons is underway at UN Headquarters in New York. A working paper calls for a nuclear-free Middle East. It would require member states of the NPT to disclose in their national reports on the implementation of the resolution on the Middle East all information available to them on the nature and scope of Israeli nuclear facilities and activities, including information pertaining to previous nuclear transfers to Israel. On May 6, 2010, the Government Accountability Office (formerly known as the General Accounting Office) released the previously secret 1978 report Nuclear Diversion in the U.S. 13 Years of Contradiction and Confusion. It fills in important historic gaps about weapons-grade uranium diversions from the U.S. to Israel.

U.S. presidents have long acquiesced to strategic ambiguity a policy of neither confirming nor denying that Israel even possesses nuclear weapons. This pretext has allowed the U.S. to deliver the lions share of its foreign assistance budget to Israel, despite clear legal prohibitions imposed by the Glenn and Symington amendments to the Foreign Assistance Act. UN member countries have long suspected that the United States either turns a blind eye or actively supports the transfer of know-how, weapons-grade uranium, and dual-use technology to Israel. The 62-page General Accounting Office investigation and correspondence confirms the United States refuses to mount credible investigations that would enable warranted prosecutions of the perpetrators.

Nuclear Diversion in the U.S.? 13 Years of Contradiction and Confusion investigates the period between 1957 and 1967 when the Nuclear Materials and Equipment Corporation (NUMEC) received over 22 tons of uranium-235 the key material used to fabricate nuclear weapons. NUMECs founder and president Zalman M. Shapiro was head of a local Zionist Organization of America (ZOA) chapter and a sales agent for the Defense Ministry of Israel in the U.S. In the early 1960s the Atomic Energy Commission (AEC) began documenting suspicious lapses in security at NUMECs plant at Apollo, Pa. In 1965 an AEC audit found NUMEC could no longer account for over 200 pounds of highly enriched uranium. Subsequent estimates spiraled to almost 600 pounds.

The GAO was chartered by Congress to investigate four allegations about what happened to the uranium. The first was that the material was illegally diverted to Israel by NUMEC management for use in nuclear weapons. This was a result of early AEC and FBI investigations into the activities of Zalman Shapiro. The second theory the material was diverted to Israel by NUMEC management with the assistance of the Central Intelligence Agency (CIA) came from the CIAs silence and demonstrated lack of interest in the entire matter. The final theories explored by GAO were more general, that the material was diverted to Israel with the acquiescence of the United States Government or there has been a cover-up of the NUMEC incident by the United States Government.

GAO solicited all available information developed by the CIA, FBI, Department of Energy, and AEC, but was continually denied necessary reports and documentation by the CIA and FBI. GAO attempted to fill in gaps or outright refusals to cooperate by directly interviewing FBI special agents. The GAO also intended to make the report public, in order to respond to growing public concerns. Rep. John Dingell (D-Mich.), the chairman of the House Subcommittee on Energy and Power, who requested the inquiry, was assured six months before it was issued that only the most sensitive areas in the report would be classified. The CIA and FBI insisted that the entire report be classified at the secret level over the objections of Dingell, who said, I think it is time that the public be informed about the facts surrounding the affair and the possible diversion of bomb-grade uranium to Israel.

The GAO report lambastes the FBIs on-again off-again approach to investigating NUMEC: The FBI, which had the responsibility and authority to investigate the alleged incident, did not focus on the question of a possible nuclear diversion until May 1976 nearly 11 years later. Initially, the FBI declined DOEs request to conduct an investigation of the diversion possibility even though they are required to conduct such investigations under the Atomic Energy Act.

The FBIs initial investigation during the 1960s quickly zeroed in on NUMEC management, but FBI recommendations for action were stymied. According to the GAO, The FBI became so concerned about the security risks posed by NUMECs president that they asked DOE whether it planned to terminate his security clearance or stop the flow of materials to NUMEC. According to the FBIs liaison with GAO, the FBI recommended that NUMECs operating license be taken away. When the FBI request was ignored, it dropped the entire investigation between 1969 and 1976.

It took a direct order from President Gerald Ford in 1976 for the FBI and Department of Justice to address the diversion aspect. The renewed investigation soon led to reversals of official U.S. government positions on NUMEC. According to the GAO report, until the summer of 1977, the only publicized Government view on the NUMEC incident was that there was no evidence to indicate that a diversion of nuclear material had occurred. By February 1978, the Nuclear Regulatory Commission (NRC) announced it had reconsidered its previous position that there had been no evidence to support diversion.

But the 11-year gap obviously hampered the effort. The GAO revealed that the DOEs nuclear materials safeguards, which before 1967 tracked the monetary value rather than the precise mass of the uranium, were seriously flawed. NUMEC claimed key records covering a period of heavy uranium loss were destroyed during a labor dispute in 1964. NUMEC paid a $1.1 million fine for 206 pounds of missing uranium in 1966, which closed the DOE case. NUMEC also hired away one of the DOEs chief on-site investigators to enhance the appearance of serious materials control and accountability. The GAO found that even by 1978 the FBI had not contacted key individuals in the affair. An FBI agent-in-charge told the GAO it did not investigate the source of funds to pay NUMECs DOE fine anticipating legal difficulties. So the GAO investigated the matter, placing its own telephone calls to Mellon Bank.

The GAO report is highly critical of the CIA: From interviews with a former CIA official and with former and current officials and staff of DOE and the FBI we concluded that the CIA did not fully cooperate with DOE or the FBI in attempting to resolve the NUMEC matter. The report is inconclusive about exactly what happened at NUMEC, but not about the agencies involved in the investigation through 1978. We believe a timely, concerted effort on the part of these three agencies would have greatly aided and possibly solved the NUMEC diversion questions, if they desired to do so.

The passage of time has removed any remaining doubts that NUMEC diverted uranium to Israel. Rafael Eitan, who visited NUMEC in 1968, was later revealed as the top Israeli spy targeting U.S. nuclear, national defense, and economic targets when his agent (U.S. Navy analyst Jonathan Pollard) was arrested spying for Israel in 1985. According to Anthony Cordesman, there is no conceivable reason for Eitan to have gone [to the Apollo plant] but for the nuclear material. CIA Tel Aviv station chief John Hadden called NUMEC an Israeli operation from the beginning, a conclusion supported by its startup financing and initial ties to Israeli intelligence. Why both the Lyndon Johnson and Richard Nixon administrations failed to credibly investigate NUMEC as a diversion challenge is also now obvious.

John F. Kennedys direct diplomatic pressures for U.S. inspections of Israels Dimona reactor grew throughout 1962-1963. During a Dec. 27, 1963, meeting with Foreign Minister Golda Meir, Kennedy expressed his hope that the relationship was a two-way street. Meir reassured President Kennedy that there would not be any difficulty between us on the Israeli nuclear reactor. Kennedy delivered a final ultimatum to Israel on July 5, 1963, insisting that Dimona undergo serial inspections in accord with international standards in order to verify its peaceful intent. Simultaneously, the Kennedy Justice Department was waging an intense battle behind closed doors to register and regulate Israels elite U.S. lobby, the American Zionist Council, which was bringing in funds from overseas to lobby. Kennedys assassination in November traumatized the nation and led to the complete and permanent reversal of both initiatives.

According to Avner Cohen, in 1958 Israeli Prime Minister David Ben Gurion had arranged with Abraham Feinberg, a major Democratic fund-raiser, to secretly finance a nuclear weapons program among benedictors in America. Abraham Feinberg, who backed Harry S. Trumans successful whistle-stop election campaign, was personally succinct about his role in the U.S. political system: My path to power was cooperation in terms of what they needed campaign money. Feinberg opened doors in Congress for up and coming leaders of the Israel lobby, including AIPAC founder Isaiah L. Kenen. According to Seymour Hersh, there is no question that Feinberg enjoyed the greatest presidential access and influence in his 20 years as a Jewish fund-raiser and lobbyist with Lyndon Johnson. Documents at the Johnson Library show that even the most senior members of the National Security Council understood that any issue raised by Feinberg had to be answered. His power and role in financing Lyndon B. Johnsons election prospects temporarily quashed scrutiny of Israels nuclear weapons program in the U.S. and abroad at a critical moment.

On Oct. 14, 1964, less than three weeks before the 1964 presidential elections, Johnsons top administrative assistant Walter Jenkins was arrested in a public restroom on sexual solicitation charges. At least $250,000 Abraham Feinberg raised for Johnson was located in Jenkins office safe. Johnson phoned his trusted aides Bill Moyers and Myer Feldman with orders to move the cash, which they did with the help of a heavy briefcase. Israel would later replenish Feinbergs coffers (as it had with Zalman Shapiro through sales commissions) with multi-million dollar favors, such as major ownership in the nations Coca-Cola franchise.

In 1968 as Israel noticeably ramped up activities at the Dimona nuclear weapons facility, Secretary of Defense Clark Clifford placed a final urgent call to Johnson, Mr. President, I dont want to live in a world where the Israelis have nuclear weapons. President Johnson was abrupt before he hung up on Clifford, Dont bother me with this anymore. By the time Israeli Prime Minister Golda Meier lobbied President Nixon to redefine U.S. non-proliferation policy as ambiguity toward Israeli nuclear weapons, Israels stockpile and number of deployed weapons was steadily growing.

The report reveals why the 2010 Non-Proliferation Review Conference at the UN like the GAO isnt really capable of challenging the true drivers of Middle East nuclear proliferation. Nuclear Diversion in the U.S.? 13 Years of Contradiction and Confusion is a report so unique and noble in intent that there will probably never be another like it. While it leaves unexplored the ongoing presence, influence, and effect of Israels lobbyists working at the center of U.S. presidential administrations, for concerned Americans the GAO provides a snapshot of a moment in time before their Congress, aspiring politicians, and mid-level management of government agencies all got the memo.

In 2010 that unwritten memo reads something like this: Crimes committed in the name of Israel no matter how audacious will never be properly investigated, let alone prosecuted so dont waste your time.

Grant F. Smith is the author of the new book Spy Trade: How Israel’s Lobby Undermines America’s Economy. He is a frequent contributor to Radio France Internationale and Voice of America’s Foro Interamericano. Smith has also appeared on BBC News, CNN, and C-SPAN. He is currently director of the Institute for Research: Middle Eastern Policy in Washington, D.C.

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