Inside the Ring

Counterspy review

Director of National Intelligence Dennis C. Blair has formed a panel of former officials to review troubled U.S. government efforts to counter foreign spying.

The panel is headed by former FBI Director Louis Freeh, who recently appeared in a PBS television documentary as a spokesman for Saudi Prince Bandar bin Sultan, a former Saudi ambassador in Washington and a national-security adviser to Saudi Arabia’s King Abdullah.

In the “Frontline” program that aired last week, Mr. Freeh said claims that “my client,” Prince Bandar, was paid $2 billion and an Airbus 340 as bribes “are totally false.”

The program revealed that the Justice Department is conducting an international corruption investigation into an $80 billion jet-fighter deal between Britain’s BAE Systems PLC aerospace company and Saudi Arabia.

Former federal Judge Eugene R. Sullivan, a law partner of Mr. Freeh’s at the Freeh Group International, said Mr. Freeh is not a spokesman for Prince Bandar but his personal attorney. He declined to comment on Mr. Freeh’s role as chairman of the director’s counterintelligence panel.

Mr. Blair has come under criticism for two other appointees. Charles “Chas” W. Freeman Jr. withdrew as his pick for a top intelligence post following reports Mr. Freeman was on the board of a state-run Chinese oil company and headed a think tank that got some funding from Saudi Arabia.

Several members of Congress also criticized Mr. Blair for appointing former CIA Director John M. Deutch to an advisory group. Mr. Deutch was pardoned by President Clinton in 2001 of charges he had compromised Pentagon and CIA secrets by improperly e-mailing highly classified documents to his home in the 1990s.

Other members of the counterintelligence review panel include former CIA officer John MacGaffin; electronic- and computer-security specialist James. R. Gosler; retired Army Maj. Gen. Robert Harding, a former director of operations at the Defense Intelligence Agency; and Mary Margaret Graham, a former CIA official who briefly headed CIA counterintelligence.

According to an administration intelligence official, the panel will hold its first meeting April 23 and will produce a report for Mr. Blair within 60 days.

“The director has asked several people to give him some advice regarding counterintelligence, an important issue to the United States,” said spokeswoman Wendy Moragi. She said Mr. Blair regards counterintelligence as “critical to the nation’s security.”

“Louis Freeh is one of the people he is speaking with. There is not a formal group, and those being consulted will offer their own thoughts,” she said.

Mr. Freeh has extensive experience in counterintelligence, and “Director Blair appreciates his advice and perspective,” Ms. Moragi said. She declined to comment on Mr. Freeh’s work for the Saudis.

Mr. Freeh was FBI director from 1993 to 2001 under Mr. Clinton, a time when the bureau suffered through several extremely damaging and long-running spy cases. They included the cases of FBI turncoats Robert Hanssen and Earl Edwin Pitts and the Chinese spying case of FBI informant Katrina Leung, who sexually compromised two senior FBI counterintelligence agents.

Kenneth E. deGraffenreid, former deputy director of the National Counterintelligence Executive office (NCIX), said most of the DNI counterintelligence panel members, including Mr. Freeh, Mr. MacGaffin and Miss Graham, opposed the counterintelligence reforms enacted into law in 2002 in the aftermath of several damaging spy cases.

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