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Stewart David Nozette

Stewart David Nozette, a Maryland scientist who once worked in varying capacities for the Department of Energy, the Department of Defense and the National Aeronautics and Space Administration was arrested for attempted espionage, David Kris, Assistant Attorney General for National Security, Channing D. Phillips, Acting U.S. Attorney for the District of Columbia, and Joseph Persichini, Jr., Assistant Director for the FBI’s Washington Field Office, announced 19 October 2009.

A criminal complaint unsealed in the District of Columbia charged Nozette, 52, of Chevy Chase, Maryland, with attempted espionage for knowingly and willfully attempting to communicate, deliver, and transmit classified information relating to the national defense of the United States to an individual that Nozette believed to be an Israeli intelligence officer. The complaint does not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. laws in this case.

Nozette was arrested by FBI agents and is expected to make his initial appearance in U.S. District Court for the District of Columbia. If convicted, he faced a maximum sentence of life in prison. "The conduct alleged in this complaint is serious and should serve as a warning to anyone who would consider compromising our nation’s secrets for profit," said David Kris, Assistant Attorney General for National Security.

"Those who would put our nation’s defense secrets up for sale can expect to be vigorously prosecuted," said Channing D. Phillips, Acting U.S. Attorney for the District of Columbia. "This case reflects our firm resolve to hold accountable any individual who betrays the public trust by compromising our national security for his or her own personal gain."

"The FBI is committed to protecting the nation’s classified information and pursuing those who attempt to profit from its release or sale," said Joseph Persichini, Jr., Assistant Director for the FBI’s Washington Field Office.

According to an affidavit in support of the criminal complaint, Nozette received a Ph.D. in Planetary Sciences from MIT in 1983, and worked at the White House on the National Space Council, Executive Office of the President, in 1989 and 1990. He developed the Clementine bi-static radar experiment that purportedly discovered water on the south pole of the moon. Nozette also worked at the Department of Energy's Lawrence Livermore National Laboratory from approximately 1990 to 1999 where he designed highly advanced technology. At the Department of Energy, Nozette held a special security clearance equivalent to the Defense Department Top Secret and Critical Nuclear Weapon Design Information clearances. Department of Energy clearances apply to access to information specifically relating to atomic or nuclear-related materials.

Nozette was also the President, Treasurer and Director of the Alliance for Competitive Technology (ACT), a non-profit corporation that he organized in March 1990. Between January 2000 and February 2006, Nozette, through his company ACT, entered into several agreements to develop advanced technology for the U.S. government. Nozette performed some of this research and development at the U.S. Naval Research Laboratory in Washington, D.C., the Defense Advanced Research Projects Agency in Arlington, Virginia, and the National Aeronautics and Space Administration Goddard Space Flight Center in Greenbelt, Maryland. From 1989 through 2006, Nozette held security clearances as high as Top Secret and had regular, frequent access to classified information and documents related to the U.S. national defense.

In connection with the fraud and tax case, Nozette admitted that, from 2000 through 2006, he used ACT to defraud the NRL, DARPA and NASA by making and presenting more than $265,000 in fraudulent reimbursement claims, most of which were paid. He also admitted that, from 2001 through 2005, he willfully evaded more than $200,000 in federal taxes. In addition, he admitted using ACT, an entity exempt from taxation because of its non-profit status, to receive income and to pay personal expenses, such as mortgages, automobile loans, sedan services and other items.

The investigation concerning ACT led investigators to suspect that Nozette had misused government information. From 1989 through 2006, Nozette held security clearances as high as TOP SECRET and had regular, frequent access to classified information and documents related to the national defense of the United States.

Nozette, for many years, had worked at various laboratories on the development of high level “Advanced Concept Technology” for space research. In late 2002, Dr. Nozette had an altercation with a co-worker in which Dr. Nozette demanded, and attempted to obtain, project information. Although . Nozette was reprimanded and demoted as a result of the incident, an investigation confirmed that he had not tried to obtain information to which he was not entitled. This incident involved neither the illegal possession nor the removal of any documents; nor did it involve Dr. Nozette’s home. The Affidavit admitted that, after March 21, 2005, Dr. Nozette had not had access to classified Advanced Concept Technology.

On Feb. 16, 2007, law enforcement agents executed a search warrant at Nozette’s home in Maryland as part of a fraud investigation and found classified documents. Further investigation into the classified documents revealed that in 2002, Nozette sent an e-mail threatening to take a classified program he was working on, “to [foreign country] or Israel and do it there selling internationally...” As a result of this and other information giving rise to suspicion of espionage, the FBI decided to conduct an undercover operation.

The Affidavit, however, does not provide any information about what had become of the seized computers, especially whether they were ever returned to Dr. Nozette, nor did it advance any reason to believe that Dr. Nozette would have continued to retain any such prohibited information in subsequent years. The Affidavit offers no explanation as to why, in the intervening three years, the Government has not been able to confirm that the information in question was, in fact, classified. Finally, the Affidavit, ostensibly to strengthen this meager showing, recurs to other allegations which actually diminish its persuasiveness.

According to the affidavit, on Sept. 3, 2009, Nozette was contacted via telephone by an individual purporting to be an Israeli intelligence officer, but who was in fact an undercover employee of the FBI (UCE). During that call, Nozette agreed to meet with the UCE later that day at a hotel in Washington DC.

According to the affidavit, Nozette met with the UCE that day and discussed his willingness to work for Israeli intelligence. Nozette met with the undercover employee and had lunch in the restaurant of the Mayflower Hotel. After the undercover employee made it clear that he was a “Mossad” agent, Nozette stated, “Good. Happy to be of assistance.”

After lunch in the hotel restaurant, Nozette and the undercover employee retired to a hotel suite to continue their discussion. During the conversation, the defendant informed the undercover employee that he had clearances “all the way to Top Secret SCI, I had nuclear…,” that “anything that the U.S. has done in space I've seen,” and that he would provide classified information for money and a foreign passport to a country without extradition to the United States.

Nozette allegedly informed the UCE that he had, in the past, held top security clearances and had access to U.S. satellite information. Nozette also allegedly said that he would be willing to answer questions about this information in exchange for money. The UCE explained to Nozette that the Israeli intelligence agency, or "Mossad," would arrange for a communication system so that Nozette could pass information to the Mossad in a post office box. Nozette agreed to provide regular, continuing information to the UCE and asked for an Israeli passport.

According to the affidavit, Nozette and the UCE met again on Sept. 4, 2009, in the same hotel. During the meeting, Nozette allegedly informed the UCE that, although he no longer had legal access to any classified information at a U.S. government facility, he could, nonetheless, recall the classified information to which he had been granted access, indicating that it was all still in his head. In the meeting, Nozette allegedly asked when he could expect to receive his first payment, specifying that he preferred to receive cash amounts "under ten thousand" so he didn’t have to report it. At the conclusion of this meeting, Nozette allegedly informed the UCE, "Well I should tell you my first need is that they should figure out how to pay me . . . they don't expect me to do this for free."

On or about Sept. 10, 2009, undercover FBI agents left a letter in the designated post office box for Nozette. In the letter, the FBI asked Nozette to answer a list of questions concerning U.S. satellite information. The undercover agents also provided a $2,000 cash payment for Nozette. The serial numbers of the bills were recorded. Nozette retrieved the questions and the money from the post office the same day.

On or about Sept. 16, 2009, Nozette was captured on videotape leaving a manila envelope in the designated post office box in the District of Columbia. On Sept. 16, 2009, Nozette left a manila envelope in the “dead drop” facility in the District of Columbia. One of the “answers” provided by the defendant contained information classified as SECRET/SCI which related to the national defense, in that it directly concerned classified aspects and mission capabilities of a prototype overhead collection system and which disclosure would negate the ability to support military and intelligence operations. In addition to disclosing SECRET/SCI information, Nozette offered to reveal additional classified information that directly concerned nuclear weaponry, military spacecraft or satellites, and other major weapons systems.

The next day, FBI agents retrieved the sealed manila envelope that Nozette had dropped off and found, among other things, a one-page document containing answers to the questions posed by the undercover agents and an encrypted computer thumb drive. One of answers provided by Nozette contained information classified as Secret, which concerned capabilities of a prototype overhead collection system. In addition, Nozette allegedly offered to reveal additional classified information that directly concerned nuclear weaponry, military spacecraft or satellites, and other major weapons systems.

Also on or about Sept. 17, 2009, undercover FBI agents left a second letter in the post office box for Nozette. In the letter, the FBI asked Nozette to answer another list of questions concerning U.S. satellite information. The FBI also left a cash payment of $9,000 in the post office box. Nozette allegedly retrieved the questions and the money from the post office box later that same day.

On or about October 1, 2009, Nozette was filmed on videotape leaving a manila envelope in the post office box. Nozette left a manila envelope in the “dead drop” facility in the District of Columbia. The FBI also left a cash payment of $9,000 in the “dead drop” facility. Later that day, the FBI agents retrieved the sealed manila envelope left by the defendant. Inside the envelope, FBI agents discovered the encrypted thumb drive that was provided to Nozette on Sept. 17, 2009, which included another set of “answers” from the defendant. The “answers” contained information classified as TOP SECRET/SCI and other information classified as SECRET/SCI. This classified information related to the national defense, in that it directly concerned satellites, early warning systems, means of defense or retaliation against large-scale attack, communications intelligence information, and major elements of defense strategy. (This information is what formed the basis for the charge in the guilty plea.)

On Oct. 5, 2009, Nozette left a manila envelope in the “dead drop” facility in the District of Columbia. Later that day, the FBI agents retrieved the sealed manila envelope left by the defendant. Inside the envelope, FBI agents discovered the encrypted thumb drive that was provided to Nozette on Oct. 1, 2009, which included another set of “answers” from the defendant. The “answers” contained information classified as TOP SECRET/SAR. This classified information related to the national defense, in that it directly concerned capabilities of a U.S. military weapon system research and development effort.

Nozette and the undercover employee met again on Oct. 19, 2009, at the Mayflower Hotel. During that meeting, the following exchanges took place: NOZETTE: “So, uh, I gave you even in this first run, some of the most classified information that there is. . . . I’ve sort of crossed the Rubicon. . . . Now the, uh, so I think when I said like fifty K, I think that was probably too low. . . .The cost to the U.S. Government was two hundred million. . . . to develop it all. Uh, and then that’s not including the launching of it. . .Uh, integrating the satellites. . . . So if you say okay that probably brings it to almost a billion dollars. . . So I tell ya at least two hundred million so I would say, you know, theoretically I should charge you certainly, you know, at most a one percent.”

Nozette was arrested soon after he made these statements. He was subsequently indicted on four charges of attempted espionage. Under the plea agreement, Nozette pleaded guilty to the third count of the indictment, arising out of his passing of TOP SECRET/SCI information on Oct. 1, 2009.

At the time of his arrest, Nozette was awaiting sentencing in another federal case. On Jan. 30, 2009, he pleaded guilty in the U.S. District Court for the District of Columbia to charges of conspiracy to defraud the U.S. government with respect to false claims and tax evasion in an amount up to $399,999. In that case, Nozette agreed to pay restitution of $265,205 to the U.S. government. Nozette is awaiting sentencing in the case. Under terms of today’s plea, the sentence in the fraud case is to run concurrently with the sentence for attempted espionage.

This investigation was conducted by the FBI’s Washington Field Office, with assistance from the Naval Criminal Investigative Service, Naval Audit Service, National Reconnaissance Office, Air Force Office of Special Investigations, Defense Computer Forensics Laboratory, Defense Advanced Research Projects Agency, Defense Criminal Investigative Service, Defense Contract Audit Agency, U.S. Army 902nd Military Intelligence Group, National Aeronautics and Space Administration (NASA) Office of Counterintelligence, NASA Office of Inspector General, Department of Energy , Internal Revenue Service (IRS) Criminal Investigation Division, IRS Tax Exempt & Government Entities group, U.S. Customs and Border Protection and U.S. Postal Inspection Service, as well as other partners in the U.S. intelligence community.

On September 7, 2011 Nozette, a scientist who once worked for the Department of Energy, the Department of Defense, the National Aeronautics and Space Administration and the White House’s National Space Council, pleaded guilty to attempted espionage for providing classified information to a person he believed to be an Israeli intelligence officer.

The guilty plea, which took place this morning in the U.S. District Court for the District of Columbia, was announced by Lisa Monaco, Assistant Attorney General for National Security; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; and James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office.

Nozette, 54, of Chevy Chase, Md., pleaded guilty to one count of attempted espionage. Senior Judge Paul L. Friedman, who presided at the plea hearing, scheduled a status hearing for Nov. 15, 2011. No sentencing date was set. The plea agreement, which is subject to the judge’s approval, called for an agreed-upon prison term of 13 years.

Nozette has been in custody since his arrest on Oct. 19, 2009. FBI agents arrested him following an undercover operation in which he provided classified materials on three occasions, including one occasion that forms the basis for today’s guilty plea. He was subsequently indicted by a federal grand jury. The indictment does not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. laws in this case.

“ Stewart Nozette betrayed America’s trust by attempting to sell some of the nation’s most closely-guarded secrets for profit. Today, he is being held accountable for his actions. As this case demonstrates, we remain vigilant in protecting America’s secrets and in bringing to justice those who compromise them,” said Assistant Attorney General Monaco.

“Stewart Nozette was once a trusted scientist who maintained high-level government security clearances and was frequently granted access to classified information relating to our national defense. Today he is a disgraced criminal who was caught red-handed attempting to trade American secrets for personal profit. He will now have the next 13 years behind bars to contemplate his betrayal,” said U.S. Attorney Machen. “The FBI and its partners deserve tremendous credit for their outstanding work on this case. This investigation and prosecution demonstrate our commitment to identifying and punishing those who would put our national security at risk.”

“Preventing the loss or compromise of high-technology and vital national security information is a top priority of the FBI,” said Assistant Director in Charge McJunkin. “This case is a prime example of what happens when a person decides to sell our nation’s most valuable secrets for individual gain.”

On March 21, 2012 Nozette, was sentenced today to 13 years in prison for attempted espionage, conspiracy to defraud the United States and tax evasion. The sentence covered charges in two cases. In one, Nozette pleaded guilty in September 2011 to attempted espionage for providing classified information to a person he believed to be an Israeli intelligence officer. In the other, he pleaded guilty in January 2009 to fraud and tax charges stemming from more than $265,000 in false claims he submitted to the government.

The sentencing, which took place this morning in the U.S. District Court for the District of Columbia, was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; Lisa Monaco, Assistant Attorney General for National Security; and Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division.

“Stewart Nozette's greed exceeded his loyalty to our country” said U.S. Attorney Machen. “He wasted his talent and ruined his reputation by agreeing to sell national secrets to someone he believed was a foreign agent. His time in prison will provide him ample opportunity to reflect on his decision to betray the United States.”

“Stewart Nozette betrayed his country and the trust that was placed in him by attempting to sell some of America’s most closely-guarded secrets for profit. Today, he received the justice he deserves. As this case demonstrates, we remain vigilant in protecting America’s secrets and in bringing to justice those who compromise them,” said Assistant Attorney General Monaco. “I thank the many agents, analysts and prosecutors who worked on this important case.”

“As this case demonstrates, those who attempt to evade their taxes by abusing the tax-exempt status of non-profit entities will be investigated, prosecuted and punished,” said Principal Deputy Assistant Attorney General DiCicco.

“Today’s sentencing demonstrates that espionage remains a serious threat to our national security,” said Assistant Director in Charge McJunkin. “The FBI and our partners in the defense and intelligence communities work every day to prevent sensitive information from getting into the wrong hands, and I commend the hard work of the dedicated agents, analysts and prosecutors who spent a significant amount of time bringing this case to resolution.”

“We are particularly proud that NASA OIG’s fraud investigation of Nozette, which began in 2006, served as the catalyst for further investigation and today's outcome,” said NASA Inspector General Martin.

“IRS-Criminal Investigation provides financial investigative expertise in our work with our law enforcement partners,” said Acting Special Agent in Charge Hylton. “Pooling the skills of each agency makes a formidable team as we investigate allegations of wrongdoing. Mr. Nozette decided to betray his country to line his own pockets rather than play by the rules. He now is being held accountable for his actions.”

“Federal agents take an oath to protect our nation ‘against all enemies, foreign and domestic.’ That would include ‘insider threats’ like Stewart Nozette,” said Special Agent in Charge Wagner. “NCIS is committed to working with our law enforcement partners and prosecutors to find and hold accountable those like Nozette who put personal gain above national security.”

After serving time at the Federal Correctional Institution, Terre Haute, Nozette was released on November 13, 2020. Stewart David Nozette is one of those brilliant minds who have left their mark on the American scientific community: an expert in planetary science, he has worked with NASA, the Pentagon, and even the White House. A career path every young scientist dreams of, between lunar missions and military secrets. But this meteoric rise was abruptly interrupted in 2009 when he was arrested for attempted espionage. A case worthy of a thriller, which would propel his name from the scientific pantheon to FBI files.