UPDATE: WAS ISRAEL SPYING ON THE U.S. DEFENSE DEPARTMENT?

IF THIS IS TRUE, IT WILL MAKE PAT BUCHANAN, NOAM CHOMSKY AND MICHAEL MOORE VERY HAPPY.

FBI Probes Pentagon Spy Case
Aug. 27, 2004
CBS News has learned that the FBI has a full-fledged espionage investigation under way and is about to -- in FBI terminology -- "roll up" someone agents believe has been spying not for an enemy, but for Israel from within the office of the Secretary of Defense at the Pentagon. 60 Minutes Correspondent Lesley Stahl reports the FBI believes it has "solid" evidence that the suspected mole supplied Israel with classified materials that include secret White House policy deliberations on Iran.

At the heart of the investigation are two people who work at The American Israel Public Affairs Committee (AIPAC), a powerful pro-Israel lobby in Washington. The FBI investigation, headed up by Dave Szady, has involved wiretaps, undercover surveillance and photography that CBS News was told document the passing of classified information from the mole, to the men at AIPAC, and on to the Israelis. CBS sources say that last year the suspected spy, described as a trusted analyst at the Pentagon, turned over a presidential directive on U.S. policy toward Iran while it was, "in the draft phase when U.S. policy-makers were still debating the policy." This put the Israelis, according to one source, "inside the decision-making loop" so they could "try to influence the outcome."

The case raises another concern among investigators: Did Israel also use the analyst to try to influence U.S. policy on the war in Iraq? With ties to top Pentagon officials Paul Wolfowitz and Douglas Feith, the analyst was assigned to a unit within the Defense Department tasked with helping develop the Pentagon's Iraq policy. Defense Secretary Donald Rumsfeld has been made aware of the case. The government notified AIPAC today that it wants information about the two employees and their contacts with a person at the Pentagon. AIPAC told CBS News it is cooperating with the government and has hired outside counsel. It denies any wrongdoing by the organization or any of its employees. An Israeli spokesman said, "We categorically deny these allegations. They are completely false and outrageous." The suspected spy has not returned repeated phone calls from CBS News.

HERE'S AIPAC'S STATEMENT ON THE REPORT:

Today, AIPAC learned that the government is investigating an employee of the Department of Defense for possible violations in handling confidential information. News stations tonight reported that the investigation centers around a supposed “mole” in the Department of Defense who allegedly disseminated internal White House policy deliberations on Iran to Israel through two AIPAC staff members.

Any allegation of criminal conduct by AIPAC or our employees is false and baseless. Neither AIPAC nor any of its employees has violated any laws or rules, nor has AIPAC or its employees ever received information they believed was secret or classified.

AIPAC is cooperating fully with the governmental authorities. It has provided documents and information to the government and has made staff available for interviews. We will continue to offer our full cooperation and are confident that the government will find absolutely no wrongdoing by our organization and its employees.

AIPAC is an American organization comprised of proud and loyal U.S. citizens committed to promoting American interests. We take our responsibilities as American citizens seriously. We do not condone or tolerate any violation of U.S. law or interests, and we have and will continue to follow the law in all its facets.

As American citizens concerned about the enduring strength of the U.S.-Israel relationship, AIPAC has and will continue to have discussions with policymakers at all levels of government. The right to petition our government is one of the fundamental rights of American citizens, which AIPAC members proudly exercise every day.

We will not let any innuendo or false allegation against AIPAC distract us from our central mission—supporting America’s interests in the Middle East and advocating for a strong relationship with Israel.

IF I WERE JONATHAN POLLARD, I WOULD FORGET ABOUT THAT PARDON.

UPDATE: Israel denies reports it has spy in the Petagon and Steinitz: Israel won't break post-Pollard pledge