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Posted at 10:19 AM ET, 09/07/2011

Guilty plea for Chevy Chase man in espionage case

A Chevy Chase man pleaded guilty to attempted espionage in the District’s federal court Wednesday morning.

Stewart D. Nozette, 54, pleaded guilty to one count before U.S. District Judge Paul L. Friedman. Nozette was given a 156-month sentence for offering top secret material about U.S. satellite defense systems to an undercover FBI agent posing as an Israeli operative during meetings in late 2009.

Friedman accepted a sentence that will give Nozette credit for time served. He has been held since he was charged in 2009.

Nozette, who held a variety of sensitive military and civilian jobs, worked for the Energy Department’s Lawrence Livermore National Laboratory from 1990 through 1999, prosecutors have said. He was credited with helping develop a radar in 1994 that suggested ice on the south pole of the moon.

He has held security clearances as high as top secret and had regular access to classified information as recently as 2006.

Nozette was originally indicted on two counts of attempted espionage in October 2009, shortly after his arrest. Two more counts of attempted espionage were added in a November 2010 indictment, and Nozette pleaded guilty to one of those charges Wednesday.  

As part of his plea, Nozette agreed to have no contact with any foreign government or agent without the permission of the FBI.
The espionage investigation spun out of a fraud investigation in which Nozette overbilled the U.S. government by $265,000 from 2000 to 2006 through an aerospace consulting firm he ran out of his Chevy Chase home. The money was used to pay off personal credit card debt, maintain the family swimming pool and cover the cost of sedan service, court files showed.
While searching the house in connection with the fraud case in 2007, law enforcement agents discovered classified documents and an e-mail in which Nozette threatened to take a classified program he was working on to a foreign country "or Israel," court records show.  The court files do not say to whom that e-mail was sent.
The indictment against Nozette does not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. law in Nozette's case.
After finding the classified materials,, the FBI opened an undercover operation in which an FBI employee posed as an Israeli intelligence officer and called Nozette, who eventually met several times with the agent at the Mayflower Hotel on Connecticut Avenue in the District.

Nozette agreed to those meetings despite already having pleaded guilty in January 2009 to tax evasion and fraud in the contracting case, records show. Those pleas were sealed because Nozette was offering information about unrelated investigations into government corruption, prosecutors said.
The undercover agent arranged for a post office box and a pre-paid disposable cell phone for Nozette's use and Nozette began delivering classified information about U.S. satellite systems, including some that would support military and intelligence operations, court records state.
Nozette accepted $11,000 in cash payments for the classified information, his plea agreement states. On the day of his arrest on Oct. 19, 2009, at the Mayflower, court files show, Nozette told the undercover agent "I've crossed the Rubicon" and said "I've made a career choice," and laughed, according to part of a transcript entered in court. Nozette also tried to up his price to the agent from an original $50,000 to $2 million — Nozette's estimate of the cost to the government of the classified system he was exposing, court files show.
Nozette told the agent he had stashed material in a safety deposit box and a subsequent search of a box he kept at a bank in La Jolla, California, uncovered three computer hard drives with 52 copies of secret information, Nozette's plea deal shows.
The 13-year sentence for Nozette covers both the attempted espionage conviction and the prior fraud and tax evasion convictions.
At the Wednesday hearing, Nozette appeared in an orange prison jumpsuit — a sharp contrast to a sea of mostly gray and dark blue suits on the roughly five dozen spectators who filled the courtroom benches.
"There's a lot of people here," said Friedman a chuckle, noting that if the hearing were for a different type of case the packed house would amount to a lot of billable hours for attorneys.  

Looking out from the bench, Friedman said he assumed the gaggle was government lawyers and representatives of federal agencies on hand to hear a plea on what Friedman called "the longest plea letter I've ever seen" at 17 pages.
In a statement, U.S. Attorney Ronald C. Machen Jr. said Nozette had gone from a "once trusted scientist" with high-level security clearances to "a disgraced criminal who was caught red-handed attempting to trade American secrets for personal profit."
Attempted espionage is a felony that carries a death penalty.  The government told Nozette's attorneys in late 2010 that it would not purse that penalty but also required Nozette to cooperate with the government in the corruption case as part of his plea deal.
Nozette's attorneys — Robert L. Tucker and John C. Kiyonaga — declined comment after the hearing.


This item has been updated.

By  |  10:19 AM ET, 09/07/2011

Categories:  From the Courthouse, Mary Pat Flaherty

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