Weekly Intelligence Notes #48-00
1 December 2000

WEEKLY INTELLIGENCE NOTES (WIN) #48-00 dtd 1 December 2000

WINs contain intelligence items and commentaries selected, written, edited and produced by Roy Jonkers for AFIO members and WIN subscribers.  Associate Editor Don Harvey contributed to this WIN.

WINs contain proprietary and copyright information, and may be electronically re-disseminated only as approved by the Editor, except in single instances for purposes of membership recruitment.
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SECTION I  -  CURRENT INTELLIGENCE

PENTAGON INSPECTOR GENERAL REPORT ON JOHN DEUTCH  --
The DOD Inspector General (IG)  said in a final report made public November 28th that John Deutch committed a "particularly egregious" violation of security rules by using unsecured computers at his home and in his office. While serving as an Undersecretary of Defense in 1993 and then as Deputy Secretary of Defense until 1995 (the second- and third-ranking civilian posts at the Pentagon, respectively),  Deutch "declined departmental requests that he allow security systems to be installed at his residence." 
   The Pentagon investigation tracked down at least seven desktop and laptop computers that Deutch had used, several of which were later sold or donated to educational institutions. None was found to have classified materials stored in their memories. But a former aide told investigators that Deutch had used two portable computers to write a daily journal that contained classified information. Because computers used for the journal also were at times hooked up to Deutch's Internet account, the inspector general called Deutch's actions "extremely risky." "The evidence we obtained clearly establishes that Dr. Deutch failed to follow even the most basic security precautions," the report concluded. During that same period, it added, Deutch signed a memorandum to all Pentagon employees warning that only "properly reviewed and cleared" information should "be placed on electronic systems accessible to the public."
   Deutch declined to be interviewed by investigators "based on the advice of counsel." A special prosecutor appointed by Attorney General Janet Reno has recommended Deutch be charged with violating security laws, but the matter is still under review.  (Wash.Post  Nov29,2000, pg 9 /// Walter Pincus) (Jonkers)

RUSSIAN AIR FORCE RECONNAISSANCE MAY RESUME ALASKA AIR PATROLS  -- The Russian Air Force has moved several of their ancient prop-driven Tu-95 Bear bombers to Anadyr airbase in northeastern Siberia, and another three to Tiksi airbase in north-central Siberia, and may soon be planning to resume air surveillance patrols off Alaska. The Russians last deployed bombers over the Bering Sea in March of this year.  Pentagon spokesman Kenneth Bacon said the Russian actions fit a recent pattern of air training and surveillance. "We would anticipate that in the next few days they might fly one or several of these planes up through the Bering Straits and close to Alaska." Twice this fall Russian Air Force planes also flew near the aircraft carrier Kitty Hawk in the Sea of Japan off the coast of Siberia, and afterward released photographs showing that they had approached the carrier. These flights are both normal training and surveillance operations, and a possible manifestation of Russian internal policy struggles about defense roles and missions, pitting the various Russian services against each other in the fight for status and budget dollars. (NYT 1 Dec 2000, AP)  (Jonkers)

NATO REVERSES COURSE ON ALBANIAN TERRORISTS -- In a reversal of familiar Balkan roles, and shifting the focus of US/NATO intelligence to yet another hotspot, NATO praised Serbian restraint yesterday and pledged to cooperate with Belgrade in a crackdown on ethnic Albanian terrorist activities. The statement by NATO Secretary General George Robertson, using the "terrorist" label for the Albanian guerillas for the first time, exposed NATO's extreme frustration with Albanian nationalist extremism and announced a six-point program of action, including new priorities for intelligence surveillance.  "Albanian extremist activity in the Presevo Valley (of Serbia proper) is in no one's interest and only serves to heighten tensions," he added.  Robertson left no doubt that he blamed the "UCPMB" for the increased tension in the area, posing a "direct threat" to the Kosovo peacekeeping mission, KFOR.
   UCPMB is the Albanian acronym for a self-styled liberation army in the Presevo Valley, a demilitarized zone between Kosovo and Serbia.. A guerilla attack last week captured several strategic points in the Valley and raised fears of more bloodshed in the region. Serbia moved tanks up to the line. Serbian police backed by two armored vehicles entered a "strategic village" in the area and searched for terrorists. 
   Measures in NATO's six-point program include (1) an information campaign on the politically damaging effects of extremist activity in the Presevo Valley; (2) mobilization of Kosovo Albanian politicians who may be able to lay a moderating hand on hard-line guerrilla groups; (3) contacts between Presevo Albanians and Serb authorities; (4) closer KFOR contacts with local Serb police; (5) increased intelligence/surveillance operations on the boundary line and (6) closer (intelligence) monitoring of any violence in the demilitarized zone.
   In context, within Kosovo, the KLA and its extremist supporters lost overwhelmingly in recent local elections, as Rugovašs moderate party received 80% of the votes (as they also received before brutal Serb counter-terrorist operations in Kosovo were opposed by the US and resulted in US/NATO embrace of the KLA, properly cleansed by propaganda). The KLA reacted, as in the past, with assassinations, this time of Rugova's subordinates, and by exporting violence to Serbia proper. It appears as if a lesson has been learned, however, in that NATO is not about to embrace the neo-Stalinist drug-dealing KLA extremists for the second time, and that the Serbs have started using their brains. US/NATO Intelligence will now be focusing on another hotspot.  (Baltimore Sun,30Nov2000) (Jonkers)

CHINA - U.S. MILITARY EXCHANGES  -- China and the United States tentatively agreed yesterday to more exchanges between their militaries. Two days of talks between U.S. Undersecretary of Defense Walter Slocombe and a group of Chinese generals exhibited the wavering dynamics that now characterize overall relations. China's pledge last week not to help Pakistan, Iran and others to build nuclear-capable missiles apparently brightened the atmosphere.  Mr. Slocombe later told reporters: "There's no question that the United States and China have real differences about issues and that some of those are quite important differences. There's a difference between that and regarding each other as enemies." As the wise man once said, "keep your friends close, and your enemies closer."  Military contacts are a sensible step in a process requiring continuous prudence. Good intelligence is a prerequisite.  (Wash Times Dec1, 2000, p. 16) 

SECTION II  -  CONTEXT & PRECEDENCE

CHINA SLIPS PAST  U.S. AWACS BAN -- Russian officials say they are going to lend China two Airborne Warning And Control System (AWACS) radar surveillance aircraft for three years,  and then sell them advanced, $200-million versions of the AWACS airplane in a deal similar to that offered previously by Israel -- which the U.S. opposed and believes it has killed.  Delivery of up to six advanced A-50E AWACS airplanes to China is to be completed by 2005, according to both U.S. and Russian officials.
   Even a first-generation Russian A-50 AWACS with a limited radar range up to 150 miles would be a key element in increasing the coordination and striking power of China's air forces. China currently has very little capability for directing groups of aircraft in a combat environment. This shortcoming has been one reason that neither Taiwan or the U.S. have been overly concerned about Chinese invasion threats, since air superiority would be necessary for any successful thrust across the Taiwan Strait.
   The standard Russian-built A-50 is a "far-less capable AWACS than the Chinese would have had" if purchase of an Israeli-developed Phalcon system had been completed. The current Russian AWACS is "early 1980s technology at best," said a U.S. radar company official. "It's large and bulky," has established a reputation for low reliability and involves old transmitter/receiver technology. However, the Russians are offering the A-50E, a derivative of the standard A-50 mainstay that carries a radar developed by the Moscow-based "NII Priborostroenie" scientific and research institute. The performance attributed to the system by Russian sources includes the ability to detect cruise missiles against ground or sea clutter at a range of up to 250 mi. The radar is expected to take three years for production, tests and integration into the aircraft.  
   U.S. Air Force analysts are said to be skeptical of the Russian performance claims. "The A-50E [will be] less capable than the Israeli-modified A-50I," said a U.S. official. "The A-50E will have a search range [for aircraft] of approximately 125 naut. mi. and the capability to track up to 50 targets. The A-50I would have had a maximum effective search range of approximately 205-215 naut. mi. and the capability to track up to 100 targets simultaneously with the more advanced EL/M-2075 [L-band] radar."
   Israeli aerospace industry officials, frustrated by last-minute U.S. opposition to their China sale, have vowed to ask for a reassessment of the program once the new U.S. administration is in office.  (AW&ST July 17, pp. 38, 45 /// Wash Post Nov 29. P.9, David Fulghum) (Jonkers)



WW II SECRET INSURANCE INTELLIGENCE UNIT - NOW DECLASSIFIED -- Some WWII intelligence operations had nothing to do with double cross operations or glamorous people, but produced more valuable information for war missions like strategic bombing than many of those so glorified during the last half-century. Probably no more than one percent of our members have ever heard of the special unit described in this report (except those who remember an earlier WIN report,­ but the story is so good it bears reiterating).  
   Newly declassified intelligence files now held at the National Archives are among those declassified last year to speed the identification of Nazi assets.  They tell of an OSS unit composed of not just secret agents, but secret insurance agents.  This "Insurance Intelligence Unit" (IIU) provided data on a global industry that both bankrolled and ultimately, helped bring down  the Third Reich.  Usually about a half dozen men, the unit focused on the enemy's insurance industry, its leaders, its records, and suspected Allied collaborators in the insurance business.  They mined standard insurance records for blueprints of bomb plants, timetables of tide changes and thousands of other details about targets, from a brewery in Bangkok to a candy company in Bergedorf.  They provided data on which factories to burn, which bridges to blow up, and which cargo ships could be sunk in good conscience.  They uncovered head counts for city blocks marked for incineration and pothole counts for roads to be used for invasion.      
   That insurance information was vital to Allied strategists who were seeking to cripple the enemy's industrial base and batter morale by burning cities.  In 1944, the unit chief wrote regarding data for an Allied bombing target committee: "Within a few days, a conference on the burning possibilities of some important cities will be held.  I have reproductions of approximately 150 plans covering Japanese plants about ready to ride."  
    Germany had 45% of the worldwide wholesale insurance industry before the war began and managed to actually expand its business as it conquered continental Europe.  As "reinsurers," these companies covered other insurers against catastrophic losses and in the process learned everything about the lives and property they were reinsuring.  The IIU was composed of men who knew the insurance business and who were able to extract volumes of useful data from the files of American, British and other insurance companies as well as spotting possible insurance contacts that tracked back to the Nazis. Working in Europe, one member of the unit - which operated in the field largely unknown to the State Department or the War Department - gathered material ranging from Chinese railway inspection reports to photos of the Mitsukoshi department store in downtown Tokyo to blueprints of the German chemical company that made poison gas.
    Interestingly, the article notes that the two largest insurance wholesalers before the war, Munich Re and Swiss Re, are, once again, the two biggest wholesalers in the world.  Presumably, these firms again hold the sort of detailed but unglamorous data they held decades ago; a cynical soul would wager the volume and mundane nature of the data means it is not being mined even if its potential value is known. (Los Angeles Times 22 Sep 00, p. A1 //Mark Fritz)   (Harvey)

SECTION III  - CYBER INTELLIGENCE

CIA COMPUTER  GAMES
- The CIA has completed its investigation of "inappropriate use of Agency computer systems" by a group of CIA employees and contractors, and administrative action has been taken in a number of instances.  It involved the use of unauthorized "chat rooms" and databases and a misuse of the Agency's computer networks.  The investigation uncovered no information involving the unauthorized disclosure of classified information, but the activities that were the subject of this inquiry were deemed to be a clear and serious violation of the trust expected of all Agency employees..
   Four employees, including one Senior Intelligence Service (SIS) officer, have had their security clearances revoked, rendering them ineligible for continued CIA employment. Eighteen employees, including two SIS officers, were issued letters of reprimand and most of them will be suspended without pay for periods ranging from 5 to 45 days. The SIS officers were also downgraded one grade. In addition, the security clearances of nine contractors were revoked. 
   The activities under investigation began in the mid-1980s as an unofficial users group on the CIA's mainframe system. Over the years, as the Agency migrated to new information systems, the hidden databases were moved to take advantage of these new systems. Concealed databases were created outside of established management and security procedures. Approximately 160 individuals at one time or another were involved. Some had retired or otherwise left the Agency at the time of the commencement of the security investigation. In addition to the disciplinary actions noted above, 79 employees, with minimal involvement, received letters of warning or security briefings. Eight employees were exonerated and no action taken. (CIA Public Affairs 30 Nov/00)
(< www.cia.gov/public_affairs/press_release/pr11302000..html> /// < www.cia.gov/cia/public_affairs/pas.html >) (Jonkers)

NATIONAL INFRASTRUCTURE PROTECTION CENTER (NIPC) REPORT -- The W32/ProLin@MM Internet worm (Shockwave) currently represents a medium threat in the United States. Shockwave worm arrives as an attachment to an email message with the subject "A great Shockwave  flash movie". The body of the message contains the text "Check out this new flash movie that I downloaded just now...It's Great, Bye".
The anti-virus software industry has created and released a Data file that will detect and remove the malicious code from the infected system.  Full descriptions and removal instructions can be found at:
http://www.symantec.com                      http://www.vil.nai.com
http://www.antivirus.com
                        http://www.fsecure.com
http://www.sophos.com
   Additional information on NIPC and NIPC Advisories is available at: < http://www.nipc.gov >. This is an FBI Awareness of National Security Issues and Response (ANSIR) report. Recipients are asked to report, actual or suspected, criminal activity to the FBI or other law enforcement agencies as appropriate.  Incidents may be reported online at http://www.nipc.gov/incident/cirr.htm (Special Agent G. Harter)

SECTION IV  -­ BOOKS & OTHER SOURCES

SADDAM'S BOMBMAKER
,  by Khidir Hamza and J. Stein, Scribner, NY 2000, (ISBN 0-684-87386-9)  Although a previous WIN included a mini-review by a media journalist of this book, the following mini-review is by AFIO President Gene Poteat, based on his reading of the book. 
   If you have been incommunicado on a Pacific island for the last few decades, you can catch up on the perpetual grindings in the Middle East by reading this book. Hamza is one of the multitude of foreign scientists trained in American Universities. He returned to his homeland to develop weapons of mass destruction that would later challenge American policies. Hamza, who was Saddam Hussein's scientist charged with building an atomic bomb to counter those of Israel, tells his story as a member of Saddam's inner circle. He concludes that a crude Uranium bomb had been designed, developed and would have been ready for testing except for the interruption by DESERT STORM -- and hidden thereafter from UN inspection teams. He learned from other scientists of similar chemical and biological weapons programs. The book is written in layman's terms and is a good read by virtue of his insight into the despotic dictator's decadent and paranoid behavior, his initial failed efforts for CIA help in defecting, his eventual escape, the CIA's later exfiltration of his family, and his life in America -- still haunted by Saddam. (Poteat)

SECTION V ­ - ODDS AND ENDS

ROYAL NAVY & MARINE FITNESS REPORTS­ (FORM S206) EXCERPTS  -- Although fairly well and widely disseminated, here are a few more snippets from British Navy and Marine efficiency reports:

* This Officer reminds me very much of a gyroscope -- always spinning around at a frantic pace, but not really going anywhere.
* When he joined my ship, this officer was something of a granny; since then he has aged considerably.
* This medical officer has used my ship to carry his genitals from port to port, and my officers to carry him from bar to bar.

(E. Badolato)

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