Simpson and his business partner, Peter Fritsch, didn’t insist at the time on knowing the names of those sources, the pair wrote in their memoir, “Crime in Progress.” It was the first of many instances in which Steele’s methods were not significantly challenged, even as his explosive claims came to dominate public debate over Trump’s ties to Russia and underpin efforts by federal agents to wiretap a Trump associate.
Five years later, there are intensifying questions about whether those involved in the dossier saga — from the political operatives who commissioned it to journalists who amplified parts of it to government officials who used it to obtain a surveillance warrant — assigned too much credibility to the allegations and the man who compiled them.
First introduced to the world in media reports as a “Real-Life James Bond,” with deep knowledge and high-level Russian sources cultivated from years of work in Britain’s intelligence service, Steele now faces considerable doubts about his methodology. Last year, a London judge found that his private intelligence firm had “failed to take reasonable steps” to verify information in the dossier.
The uncertainty about the dossier’s sourcing was deepened by the indictment this month of Washington-based analyst Igor Danchenko, who authorities say served as the primary conduit of information to Steele. Danchenko is accused of lying to the FBI about where he got his information. Complicating matters, Danchenko also has suggested that his tips were mishandled. The analyst, who has pleaded not guilty, told the FBI shortly after the dossier became public in January 2017 that he was surprised by the use of his intelligence, saying, for example, that the report about Trump’s alleged sexual activity was based on “rumor and speculation.”
Some intelligence experts say Danchenko’s indictment shows why it was a grievous error not to subject Steele’s intelligence to more serious scrutiny. Authorities could have applied more rigor, said Daniel Hoffman, a former CIA officer in Russia, by asking, “Did you test your sub-sources? Did you ask them questions to which you know the answer?”
“Steele should do a mea culpa in front of the world,” said Hoffman, who is a Fox News contributor and advisory board member for BGR Group, a lobbying firm that has represented a Moscow-based bank featured in the dossier.
Steele has not been charged with wrongdoing, and he declined to comment for this story.
Others maintain that Steele’s reports should never have been seen as definitive but instead as “raw intelligence” requiring verification. But the dossier’s unverified claims burst into public view when BuzzFeed News published them on Jan. 10, 2017. Some media outlets gave airtime to the most salacious allegations, while others did not report details of the dossier because they could not be corroborated. Regardless, coverage of the dossier’s existence thrust it to the center of public debate.
The Washington Post did not publish the dossier. But The Post did publish two stories about an alleged source for the dossier; large parts of those stories have been removed, and the pieces have been corrected following Danchenko’s indictment.
The allegations against Danchenko make the sourcing of Steele’s reports look more “troubling,” said John Sipher, who served the CIA in Moscow around the same time Steele was stationed there in the early 1990s. But he also stressed that Steele’s overall thesis — that Russia was attempting to influence the election — has been substantiated by the U.S. intelligence community.
During the 2016 campaign, Trump called on “Russia, if you’re listening,” to unearth Clinton’s emails. In the years since, the president has used Steele’s dossier to discredit the broader inquiry into Russia’s interference in the election. “This man should be extradited, tried, and thrown in jail. A sick lier who was paid by Crooked Hillary & the DNC!” Trump tweeted in July 2020, misspelling the word “liar.”
Steele told ABC News last month: “I stand by the work we did, the sources that we had, and the professionalism which we applied to it. … I think there are parts of the dossier which have been stood up, there are parts of the dossier that haven’t been stood up. And there are one or two things in it which have been proven wrong.” Simpson and Fritsch declined to comment.
Danchenko’s lawyer, Mark E. Schamel, said in a statement that special counsel John Durham’s indictment presented “a false narrative designed to humiliate and slander a renowned expert in business intelligence for political gain. … Mr. Danchenko’s body of work, for the United States, is above reproach.”
In light of the new allegations, The Post reviewed court records, summaries of FBI interviews and books by key players, among other documents, and conducted interviews with some of those who worked with Steele to examine how the dossier was assessed at the time of its compilation and dissemination.
Many of those details have emerged in piecemeal form over the past several years through court filings and citations in reports issued by a Senate committee and the Justice Department’s inspector general. That material, along with the indictment, now provides a deeper look at Steele’s methods and sources than initially available. The Post’s review also sheds light on the murky world of corporate spycraft, in which Steele was working for his own company and for the FBI.
It is, however, not yet a full picture. Steele has spoken only in general terms about how he put together the dossier, and some of those who have been cited as its sources have challenged accounts of their roles.
‘This is a serious business’
Long before Steele became known for the dossier, he was a spy for the British intelligence service MI6 and, later, a source for the FBI.
After joining MI6 in 1987, Steele was sent to Moscow in 1990, where he saw the Soviet Union collapse. He later watched Moscow from a London post, according to the memoir by Simpson and Fritsch, both former Wall Street Journal journalists. (Steele told ABC News he is barred by British law from acknowledging he worked for MI6.)
A pivotal moment in Steele’s career came when he helped investigate the death of Russian defector Alexander Litvinenko, a former KGB officer who became an informant for MI6 and was poisoned in 2006 with radioactive polonium. The Russian’s death intensified Steele’s dislike of Russian President Vladimir Putin, according to Simpson and Fritsch’s account.
Three years later, Steele co-founded Orbis Business Intelligence, a private intelligence firm, and soon began working with Simpson’s firm. Around the same time, Steele met with an FBI agent, Michael Gaeta, and became a source in an investigation into a soccer corruption case, paving the way, by 2013, for Steele’s official classification as an FBI confidential human source. Gaeta did not respond to a request for comment. The FBI declined to comment.
One focus of Steele’s reporting for the FBI, according to the inspector general’s report, was Russia.
Initially, Russia was not central to Fusion GPS’s examination of Trump, which was first commissioned by the Washington Free Beacon, an online publication backed by Republican billionaire Paul Singer. Singer declined to comment, and his spokesman pointed to a previous statement from the Free Beacon that said in part, “none of the work product that the Free Beacon received appears in the Steele dossier. The Free Beacon had no knowledge or connection to the Steele dossier, did not pay for the dossier.”
After Trump emerged as the likely GOP presidential nominee, that contract dried up and Fusion pitched its work to Democrats. A lawyer working for Clinton’s campaign and the Democratic National Committee enlisted Fusion, whose inquiry deepened into Trump’s possible Russia connections.
In May 2016, Simpson hired Steele to mine his Moscow sources; all told, Steele would later say in a deposition, his company received a retainer worth 100,000 pounds, or about $130,000, in addition to expenses.
Steele’s first memo, which would later become part of the dossier, was dated June 20, 2016. It was stunning. “Russian regime has been cultivating, supporting and assisting Trump for at least five years,” it said. Russia “has compromised TRUMP through his activities sufficiently to be able to blackmail him.” It said that prostitutes had urinated in front of Trump in a Moscow hotel in a scene possibly recorded by Russian intelligence services.
As Steele wrote his report, he discussed with his business partner, Chris Burrows, whether to include the prostitute story. Burrows said in an ABC News documentary released last month that he had urged Steele to “take out the pee pee tape.”
“You just don’t talk about sex in reports,” he said. “This is a serious business.”
But Steele, who told ABC News even his wife had urged that the incident be deleted, decided to include it because it indicated Moscow potentially had “Kompromat” on Trump, referring to compromising material that could be used for blackmail. “My view is that we always have to stay true to the intelligence,” Steele said. “I’ve seen situations in the past where things have been smoothed off on the edges, where things that might seem a bit outlandish have been left out … to me, that’s wrong.” Trump has denied the allegation, noting that he is a “germaphobe.”
After reading the first report, Simpson and Fritsch questioned Steele, who provided general descriptions of his sources but not names, according to the pair’s account. Subsequently, the pair wrote, Steele identified, “sometimes by name, no fewer than seven sources for the report’s shocking hotel scene.” The book doesn’t disclose the names of those sources.
At the same time, Steele said he relied on a “collector” of information who was “among the finest he had ever worked with, an individual known to US intelligence,” Simpson and Fritsch wrote. Their 2019 memoir says “neither Simpson nor Fritsch was told the name of this source, nor this source’s precise whereabouts, but Steele shared enough about the person’s background and access that they believed the information they planned to pass along was credible.”
Thus, it cannot be said with certainty that it refers to Danchenko, who is described in the indictment as the key collector of Steele’s information.
In a footnote in their memoir, Simpson and Fritsch quote Steele saying, “This is a remarkable person with a remarkable story who deserves a medal for his service to the West.”
A ‘prolific asset’
The indictment secured this month by Durham, the special counsel, suggests Danchenko holds the key to the dossier’s credibility.
Born in the former Soviet Union, Danchenko was oriented West from a young age. He completed high school in Perm, a city on the outskirts of Siberia, and spent a year as an exchange student in Slidell, La. After graduating from Perm State University, he landed at the University of Louisville, where he focused on comparative politics, with a particular emphasis on the Russian oil industry, completing a master’s degree in 2005 under Charles Ziegler, an authority on Russian politics.
Danchenko was skilled at identifying Russian-language sources and ferreting out information, Ziegler said. He enrolled in another master’s program, at Georgetown University, and joined the Washington-based Brookings Institution, working closely with the economist and Russia specialist Clifford Gaddy. In 2006, the pair exposed alleged plagiarism in Putin’s PhD dissertation.
The project boosted Danchenko’s profile, though not all favorably. He told Ziegler he had been warned by someone in Russia “not to show his face around Moscow for a while,” the professor recalled in an interview with The Post.
The same year, Danchenko had contact with the Russian Embassy and “known Russian intelligence officers,” according to an overview of the FBI’s counterintelligence investigation into the foreign national, which was declassified last year at the request of Sen. Lindsey O. Graham, then-chairman of the Senate Judiciary Committee. The South Carolina Republican would go on to label Danchenko a “Russian spy” — claims that prompted a cease-and-desist letter from Danchenko’s lawyer. A spokesman for Graham did not respond to a request for comment.
The interactions revealed in the FBI overview include Danchenko allegedly telling a Russian intelligence officer that he was interested in one day joining the Russian diplomatic service. It also explains how the investigation began in 2009, based on a reported incident from the year before, in which Danchenko is alleged to have suggested to colleagues that he knew how they could “make a little extra money” if they had access to classified information.
The investigation into Danchenko concluded in 2011 without any apparent findings.
Schamel, Danchenko’s lawyer, told The Post it was an “undisputed fact within American national security circles, to include the Senate and House intelligence committees, that Mr. Danchenko has been of assistance to the United States with his willingness to sit down and answer questions by the FBI, and that he has never worked for a foreign intelligence service and there is no credible allegation that he ever has.” He said this fact was known to “every person in the United States government with the appropriate security clearance.”
By the time the FBI probe was closed, Danchenko had already met Steele, based on the timeline set forth in Durham’s indictment. Their hour-long introduction in 2010 occurred at a Starbucks, according to a declassified FBI write-up of interviews with Danchenko.
They were introduced by Fiona Hill, the Russia expert who was then at Brookings but had been Steele’s counterpart when she served on the National Intelligence Council from 2006 to 2009. When Steele inquired about analysts capable of conducting research on political risk, Hill suggested Danchenko, whose time at Brookings was running out, according to the FBI write-up and a person familiar with the interactions, who spoke on the condition of anonymity because of the matter’s sensitivity. As a foreign national, Danchenko wanted to find an employer who would sponsor his visa, according to FBI documents and the knowledgeable person. Short-term consulting gigs had failed to yield more stable employment.
Hill, according to knowledgeable people, would also later introduce Danchenko to Charles Dolan Jr., a public relations executive with ties to the Democratic Party who, according to the special counsel, would ultimately supply some information included in the dossier.
Danchenko’s first assignment for Steele was an investment-related risk assessment based on openly available sources. He was compensated several hundred dollars, a boon at the time because he had no meaningful source of income, he later told investigators.
Pleased with the report, Steele hired him. Danchenko signed a confidentiality agreement, communicating with Steele via email and Skype. Subsequent projects addressed Russian leadership and banking, among other themes, Danchenko would tell investigators.
Cautioned by Steele against taking notes on information gleaned from sources, he made only “scribbles and/or chicken scratch notes here and there,” the FBI reported in interview summaries. Orbis never made contact with Danchenko’s sources but used him as the intermediary, he told investigators.
Danchenko’s reporting became better over time, Steele and his business partner would later say, according to an FBI summary of an interview with them in September 2017. Steele said Danchenko had become a “prolific asset” and was confident he was not “under control” by hostile forces. At the same time, according to the FBI, “Steele cannot guarantee” that Danchenko’s underlying sources weren’t being manipulated.
When tasked with reporting related to the American election, Danchenko felt uncomfortable and out of his depth, he told the FBI in a January 2017 interview. The first such request, relayed from Steele in March 2016, before Fusion GPS had begun commissioning the work, was to surface information about Paul Manafort, the attorney and political consultant, who had begun working with Trump’s campaign.
Danchenko’s friends and contacts in Russia, he would later say, were “too far removed” from the assignment, which soon broadened to include finding compromising information about Trump, and possibly also about Hillary Clinton.
A ‘rabbit hole’
Uncertainty still marks the sources used by Danchenko, as well as the extent of Steele’s reliance on him for the dossier.
Danchenko has not publicly identified his sources, whose names are redacted in government documents. Sworn statements by those identifying themselves as possible sources are inconclusive and, in one instance, contradictory.
To the FBI, Danchenko denied communicating about allegations in the report with Dolan, whose lawyer confirmed he was the PR executive described in the indictment. They discussed “nothing specific,” Danchenko told investigators, according to the indictment. The special counsel, however, claims Danchenko “sourced one or more specific allegations” to Dolan, including disparaging information about Manafort. The discrepancy is the basis for one charge of lying to the FBI leveled against the Russia analyst this month.
The other charges rest on Danchenko’s account of purported interactions with the onetime president of the Russian American Chamber of Commerce, Sergei Millian. Danchenko told the FBI he received a “very strange phone call from a Russian male who he believed to be” the chamber president in 2016, according to the bureau’s summary. The man never identified himself, but the two made plans, which were not acted on, to meet in person, Danchenko told law enforcement, according to FBI interview summaries and the indictment. He “fabricated” this account, the indictment asserts, maintaining that Danchenko never received such a phone call.
Communications cited in the indictment are heavily redacted. The indictment also makes reference to subsequent FBI interviews with Danchenko, beyond the sessions in January 2017, but summaries of these later encounters have not been publicly released.
Beyond confirming the reference to his client in the indictment, a lawyer for Dolan declined to comment. Millian, who has previously denied being a source for the dossier, could not be reached for comment.
A handful of other people have made public statements addressing their possible role as Danchenko’s sources.
At least six gave statements as part of litigation pursued against Fusion GPS by leaders of Alfa Bank, a Moscow-based bank that is featured in the dossier. All are Russian citizens, ranging from academics to journalists to communication advisers to former government officials. They claim their biographical details match those provided by Danchenko in his interviews with the FBI; each came forward as one of his supposed sources while denying having supplied him information as presented in the dossier.
“Igor Danchenko and I have been friends since our teen years in Perm, Russia,” states the affidavit from Olga Aleksandrovna Galkina, who describes herself as a communications specialist and onetime adviser to a Web company that features in the dossier. Although her personal details match the description Danchenko provided to the FBI about “source 3,” Galkina’s affidavit states, she did not give him “any information mentioned in the dossier.” Danchenko identified her as a source, she argues, to “create more authoritativeness for his work.” Galkina did not respond to a Facebook message seeking comment.
But the sworn statements seeking to cast doubt on Danchenko’s credibility as a conduit of information confuse as much as they clarify. Two people — a political science professor in St. Petersburg and a lecturer at the Moscow State Institute of International Relations — both say their personal details match those associated with Danchenko’s “source 4.”
Danchenko, for his part, would later flesh out for investigators how his sources had motives of their own. One, he said, consistently asked about opportunities to make money.
Steele has said he did not rely on Danchenko alone, instead obtaining information from “one main source and a couple of subsidiary sources,” according to his witness statement in the Alfa Bank case. “The Dossier was comprised of intelligence obtained from 3 sources and approximately 20 sub-sources.”
Steele’s information first reached the FBI through his handler, who flew to London and then conveyed the information up the chain, a process that was delayed by a number of weeks before reaching agency officials who were already probing possible Russia interference in the election.
The ex-spy’s handler did not immediately press him on his sources, according to testimony to a House committee. “He just said it was through his source network,” the official said. “I never asked the identity of his sources or his network.”
Inside the FBI, understanding would remain incomplete of whether Danchenko was the sole, or simply the primary, basis of Steele’s information.
A senior counterintelligence official involved in the Russia inquiry, Jennifer Boone, told the inspector general that she recalled being told that Steele “may have gotten some of his information from a source other than” Danchenko. Meanwhile, Peter Strzok, the FBI agent who opened the Russia inquiry and was later fired over his anti-Trump texts, recalled learning that Danchenko served as the “intermediary” for the entire network of sub-sources, according to the inspector general’s report.
As a result, Strzok observed in early 2017, “Steele may not be in a position to judge the reliability of his sub-source network.” Strzok declined to comment. Boone did not respond to a request for comment.
Many of the claims in the dossier were impenetrable to the FBI because they rested on conversations or meetings whose participants alone know what was discussed. As Strzok put it, agents “couldn’t necessarily prove it and couldn’t disprove it either.”
Hill, in testimony for Trump’s first impeachment hearing, said the Russians “use whatever conduit they can” to spread disinformation, calling the dossier a “rabbit hole” that bore hallmarks of possible foreign subterfuge.
It was a rabbit hole into which the FBI, in at least one instance, ran headlong. The inspector general’s office found that the dossier “played a central and essential role” in the FBI’s presentation of Carter Page, a Trump campaign adviser, as a possible Russian agent. It made that case in successful applications to wiretap him in late 2016 and 2017 under the Foreign Intelligence Surveillance Act, or FISA. The Justice Department later admitted that it had lost confidence in the underlying evidence by the time of its two final renewal applications. Page declined to comment.
The inspector general’s report identifies the FBI’s January 2017 interviews with Danchenko as a turning point for the legitimacy of the surveillance effort. Rather than revising the applications to reflect revelations from Danchenko that “contradicted or were inconsistent with information from Steele’s reports,” the inspector general alleges, an attorney instead merely added that the FBI was seeking to “further corroborate” Steele’s reporting.
That reporting, Danchenko told the FBI, was based on “just talk” and “hearsay” and “conversation … with friends over beers.” Steele, meanwhile, told agents during an October 2016 meeting in Rome that one of his sources was a “boaster” and “egotist” and “may engage in some embellishment,” according to the inspector general’s report.
Steele maintained, in his statement in the Alfa Bank case, that he “did not take what was said at face value” but instead used public data, reporting from other sources and government findings “to corroborate or contradict the intelligence we received.”
At points, Steele gave insight into his methods.
He told the FBI that his primary source had access to a “particular former senior Russian government official,” according to the inspector general’s report, while Danchenko said he had “never met or spoken with the official.” In a video deposition taken as part of an unsuccessful defamation lawsuit mounted against BuzzFeed News by a Russian Internet entrepreneur featured in the dossier, Steele said he used an article from CNN iReport to verify allegations about the entrepreneur’s business practices. He was unaware, he revealed, that iReport was not the work of CNN journalists but rather a user-generated initiative that has since been discontinued.
Steele told U.S. investigators that he had no evidence his reporting had been “polluted” by Russian disinformation, a possibility considered by the FBI, according to the inspector general’s report. Bill Priestap, a former top FBI official, said the bureau “didn’t have any indication whatsoever” by May 2017 that the Russians were using Steele to plant disinformation, according to the report. But a tip received by the FBI in January 2017, and referred to in an interview conducted by Senate Judiciary Committee staff with an FBI supervisor, carried claims that lurid details about Trump’s alleged activities with prostitutes had originated from Russian intelligence services “infiltrating a source into the network” for the dossier. Priestap declined to comment.
Despite Steele’s credibility owing to his profile and past work with the FBI, authorities did endeavor, beginning in 2016, to vet him. FBI agents learned from associates that he was smart and had integrity but was headstrong and sometimes demonstrated poor judgment, according to the inspector general’s report. Some of those evaluations never made their way into Steele’s file, according to the inspector general, and were not included in applications for the surveillance of Page.
A separate report completed in March 2017, and cited by the inspector general, found that Steele’s past reporting for the FBI had been “minimally corroborated." By that time, Steele had already been cut off as an FBI source, an FBI supervisor told the Senate Judiciary Committee, because he had divulged his dealings with the agency to the media.
Sipher, the former CIA agent in Moscow, said the dossier has become political fodder for both parties.
“Republicans want to say it’s all made up and it’s Democratic stuff,” he said. “People who hate Trump say, look at all the stuff in there. It’s all true.”
But he said the U.S. intelligence community never relied on it in reaching their conclusion about Russian interference in the election. The report on Russian interference in the 2016 election by special counsel Robert S. Mueller III shows his investigators asked witnesses about some of the allegations in the dossier, but did not rely on it. Mueller, asked during a House hearing about the dossier, declined to address it.
“To professionals, it never mattered at all,” Sipher said.
‘Out of the shadows’
After four years of declining to speak publicly about his dossier, Steele last month broke his silence to defend his work in the ABC News documentary “Out of the Shadows,” which also included interviews with his family, friends and colleagues.
Steele said in the interview that he believes that while some unspecified parts of the dossier have been “proven wrong,” his assertion of Russian interference in the election on Trump’s behalf has held up. He said “there is a chance” that he fell victim to a Russian disinformation effort, but said it was “very unlikely” because Moscow wanted Trump to be president. Asked whether there is a tape of Trump cavorting with prostitutes, he said it “probably does” exist but he “wouldn’t put 100 percent certainty on it.”
Steele even refused to concede that his report that Trump lawyer Michael Cohen met in Prague with Russians was wrong, even though Cohen rejects it and the Mueller report said, based on an interview with Cohen, that he “had never traveled to Prague and was not concerned about those allegations, which he believed were provably false.” Steele told ABC News: “From my point of view, I think it’s still an open question.” Cohen said in a statement to The Post that allegations against him in the dossier are “totally inaccurate.”
A new assessment of the dossier is expected to come eventually from Durham, whose two-year investigation into the origins of the Russia inquiry appears to be aimed in part at scrutinizing the dossier and those involved in it. While it is not known whether Durham, whose office declined to comment, will seek more indictments or when he will complete his probe, he is required under the terms of his appointment to release both a confidential assessment of his findings and a declassified version that will be made public.