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The Hollywood Spy

The producer of "Pretty Woman" helped Israel build its nuclear arsenal.

If a man living in America were to go on television and admit that he spent years stealing U.S. defense secrets on behalf of another country, and was proud of what he had done, Attorney General Eric Holder would immediately fly into a rage and call for arrest and prosecution under the Espionage Act, wouldn’t he? Well, maybe not, if the recent revelations made by Hollywood producer Arnon Milchan regarding his spying for Israel are anything to go by. There has long been a certain acceptance both in the media and within the government that something done on behalf of or together with Israel is somehow not subject to the same laws of physics that govern the rest of the political universe. I recall how in the 1980s while I was working in the Central Intelligence Agency base in Istanbul, a delegation from the American Jewish Committee passed through and briefed the Consul General and his staff regarding Jonathan Pollard, who had recently been arrested. They claimed that Pollard was some kind of nut case who could not possibly have been a real spy for Israel. The Consul General, who should have known better than to buy into the obvious damage control, expressed the same view during the weekly staff meeting. When I and several others challenged the credibility of his viewpoint, he shrugged and smiled.

We Americans have since learned that Pollard was not only a fully controlled and paid spy for Israel, he was one of a network of spies recruited by handler Rafi Eitan. The Israelis were so well informed regarding U.S. defense secrets that they frequently were able to ask Pollard to obtain specific files, by name and number, that they particularly wanted to see. Pollard eventually handed over to the Israelis a roomful of documents. Many in the intelligence community believe that the information he provided, some of which was passed on to the Russians and others, continue to do damage to U.S. technical collection capabilities to this day. Pollard, who has been given Israeli citizenship and is widely regarded as a hero by the country’s leadership, is serving a life sentence in federal prison. Demands from the Israeli government to free him are a regular occurrence whenever the American President and Israeli Prime Minister meet. Another spy in the Eitan network was Ben-Ami Kadish, an engineer at the Picatinny Arsenal in New Jersey, who provided nuclear and weapons development secrets to his Israeli case officer Yosef Yagur, who also met with Pollard.

Israel, to be sure, obtains much of its information from the United States openly, by walking into an office at the Pentagon or on Capitol Hill and being handed a file. Or over lunch, as when Pentagon analyst Larry Franklin provided intelligence on Iran to American Israel Public Affairs Committee (AIPAC) staffers Keith Weissman and Steve Rosen, as well as to officials in the Israeli Embassy. Franklin went to jail and is now waiting on tables in West Virginia, but Rosen and Weissman, charged under the Espionage Act, walked due to some maneuvers pulled by an obliging federal judge who was clearly acting on behalf of a George W. Bush administration that did not want the case to go forward.

Less well known than either the Pollard or AIPAC spying cases is the story of how Israel obtained the technology and raw materials for its secret nuclear arsenal. In the early 1960s, President John F. Kennedy learned that Israel was developing a nuclear weapon from a CIA report. He told the Israelis to terminate their program or risk losing U.S. political and economic support but died before he could confirm that the project had ended. His successor Lyndon Johnson was famously tight with Israel’s friends in the United States. Johnson did not insist that Israel end its nuclear program and, as he was privy to the CIA report about the weapons program, may have deliberately chosen to look the other way when Israel was stealing both American technology and uranium to construct its weapons.

Israel always features prominently in the annual FBI report called “Foreign Economic Collection and Industrial Espionage.” The 2005 report states, “Israel has an active program to gather proprietary information within the United States. These collection activities are primarily directed at obtaining information on military systems and advanced computing applications that can be used in Israel’s sizable armaments industry.” Israel has sold advanced weapons systems to China that are believed to incorporate technology developed by American companies, including the Python-3 air-to-air missile and the Delilah cruise missile. There is evidence that Israel has also stolen Patriot missile avionics to incorporate into its own Arrow system and that it used U.S. technology obtained in its Lavi fighter development program, which was funded by the U.S. taxpayer to the tune of $1.5 billion, to help the Chinese develop their own J-10 fighter.

The Mossad frequently uses so-called sayanim in its espionage, which means diaspora Jews that it recruits on the basis of a shared religion or concern for the security of Israel. The threat coming from Israeli Embassy operatives inside the United States is such that the Department of Defense once warned that Jewish Americans would likely be the targets of intelligence approaches.

Israel accelerated its nuclear program after the death of President Kennedy. By 1965, it had obtained the raw material for a bomb consisting of U.S. government-owned highly enriched weapons grade uranium obtained from a company in Pennsylvania called NUMEC. NUMEC was a supplier of enriched uranium for government projects but it was also from the start a front for the Israeli nuclear program, with its chief funder David Lowenthal, a leading Zionist, traveling to Israel at least once a month where he would meet with an old friend Meir Amit, who headed Israeli intelligence. NUMEC covered the shipment of enriched uranium to Israel by claiming the metal was “lost,” losses that totaled nearly six hundred pounds, enough to produce dozens of weapons. In 1968, NUMEC received a visit from spymaster Rafi Eitan, the same Rafi Eitan who later was involved with Jonathan Pollard.

There was also physical evidence relating to the diversion of the uranium. Refined uranium has a technical signature that permits identification of its source. Traces of uranium from NUMEC were identified by Department of Energy inspectors in Israel in 1978. The Central Intelligence Agency has also looked into the diversion of enriched uranium from the NUMEC plant and has concluded that it was part of a broader program to obtain the technology and raw materials for a nuclear device for Israel.

With the uranium in hand, the advanced technology needed to make a nuclear weapon was still needed, which is where Milchan comes into the story. Arnon Milchan was born in Israel but emigrated to the United States and eventually wound up as the owner of a major movie studio, New Regency Films. In his November 25th interview on Israeli television Milchan admitted that he had spent his many years in Hollywood as an agent for Israeli intelligence, helping obtain embargoed technologies and materials that enabled Israel to develop a nuclear weapon. He worked for Israel’s Bureau of Science and Liaison acquisition division of Mossad, referred to as the LAKAM agency. It was the same organization that ran Jonathan Pollard and Ben-Ami Kadish.

Milchan, who is a long-time resident of the United States and still has significant business interests in this country, explained “I did it for my country and I’m proud of it.” He also said that “other big Hollywood names were connected to [his] covert affairs.” Among other successes, he obtained through his company Heli Trading 800 krytons, the sophisticated triggers for nuclear weapons. The devices were acquired from the California top-secret defense contractor MILCO International. Milchan personally recruited MILCO’s president Richard Kelly Smyth as an agent before turning him over to another Heli Trading employee Benjamin Netanyahu for handling. Smyth was eventually arrested in 1985 and cooperated in his interrogation by the FBI before being sentenced to prison, meaning that the Federal government likely knew about both Milchan and Netanyahu at the time but declined to act. For what it’s worth, Milchan now improbably claims that he did not know about the kryton triggers.

I would like to think that the next time Arnon Milchan arrives at LA International Airport on business he will be met by Federal Marshalls and FBI agents before being whisked off to some nice quiet place for a chat. But don’t bet on it. Milchan’s confession suggests that he believes himself to be bullet proof. As in the case of Rosen and Weissman his likely defense would be that he was only doing it for Israel, an ally and friend, which itself is a matter of perception to say the least. That Israel has an unacknowledged nuclear arsenal that violates the Nuclear Non-Proliferation Treaty, which the U.S. and even Iran have signed but Israel has not, undeniably contributes to the destabilization of the Middle East. A secret nuclear power with a government that many would consider to be somewhat paranoid is certainly not in the United States interest. And some Americans might also be a bit unsettled to learn how Israel’s nuclear capability was acquired by way of Hollywood.

Philip Giraldi, a former CIA officer, is executive director of the Council for the National Interest.