ISRAELI SOLDIER SUSPECTED AS HEZBOLLAH SPY

Soldier suspected as Hezbollah spy (JTA)
An Israeli soldier is suspected of supplying classified information to Hezbollah in exchange for drugs.

Police announced Monday that a noncommissioned officer serving as an infantry tracker along the Israel-Lebanon border was arrested last month on suspicion of spying for the Lebanese terrorist group.

According to authorities, the soldier gave Hezbollah information on Israeli troop deployments along the frontier in exchange for its expedition of cross-border drug deals.

Two other Israelis in custody are suspected of being involved in the alleged drug smuggling.

No personal details were immediately available on the arrested soldier other than that he lives in the Galilee area. Israel's military trackers generally are Bedouin Arabs.

U.S.'S COVERT 2006 STRATEGY AGAINST HAMAS

US sought to oust Hamas, sparking civil war: report. (AFP)
WASHINGTON (AFP) - US President George W. Bush and Secretary of State Condoleezza Rice covertly sought to oust Hamas after the 2006 polls triggering a bloody Palestinian civil war, a US magazine alleged Tuesday.

Vanity Fair said it had obtained confidential documents, which had been confirmed by US and Palestinian sources, that Washington sought to arm a Palestinian force led by Fatah loyalists to oust Hamas militants from power.

“But the secret plan backfired, resulting in a further setback for American foreign policy under Bush,” the magazine wrote.

“Instead of driving its enemies out of power, the US-backed Fatah fighters inadvertently provoked Hamas to seize total control of Gaza.”

The report, which the magazine dubbed Iran-Contra 2.0 in reference to a controversial 1980s arms scheme under late president Ronald Reagan, was swiftly dismissed by State Department spokesman Tom Casey as “false, wrong, untrue, silly, ridiculous.”

Gaza Confidential

NOAH POLLAK - (Contentions)

The exciting piece of foreign policy reportage to hit the presses this week is David Rose’s account in Vanity Fair of the covert strategy the Bush administration pursued to undermine Hamas after the group came to power in the 2006 Palestinian elections. The administration’s idea was to use an old Fatah security strongman, Muhammad Dahlan, to head up a new security force that would serve two U.S. policy goals: the unification and reform of the byzantine PA security services, and the assemblage of a Fatah force that would be able to put Hamas in its place.

As Rose reports,

A State Department official adds, “Those in charge of implementing the policy were saying, ‘Do whatever it takes. We have to be in a position for Fatah to defeat Hamas militarily, and only Muhammad Dahlan has the guile and the muscle to do this.’ The expectation was that this was where it would end up—with a military showdown.”

As everyone knows by now, there was no military showdown in Gaza — there was a rout of Fatah’s forces by Hamas.

On one level, this story can be filed away as a smaller example of the failure of American state-building among the Palestinians. No matter how many different and creative ways successive American administrations have arranged incentives, disincentives, aid packages, diplomatic agreements, and the like, little is to show for it but Palestinian violence — whether the 2000-2004 terror war that followed Oslo, or Hamas’ rocket war today. Relying on Palestinian strongmen/terrorists has been a disaster (Arafat); relying on Palestinian elections has been a disaster (Hamas); and now we have evidence that an even finer-grained involvement in Palestinian internal affairs — assigning a Palestinian strongman the task of dispatching with a democratically-elected terror group — helped precipitate the Hamas coup in Gaza. More disaster.

On another level, there is something irreconcilable in all of this furious gamesmanship: The Bush administration wishes to promote democratic Palestinian statehood, yet refuses to make an honest assessment of the political ambitions of the Palestinian people. There does not seem to be a great deal of appreciation for the idea that Hamas represents something genuine about the worldview of a large faction of Palestinians — a refusal to accept Israel; a choice of violence over diplomacy; and a desire in governance for the Islamic over the secular. Given this level of self-deceit, it is not surprising that Condi Rice’s skulduggery only served to worsen the situation.

U.S. INTELLIGENCE CHIEF CORRECTS IMPRESSION GIVEN BY NIE ON IRAN'S NUKES

Don't Worry. Wait, Worry! (WSJ-BOTW)
Remember that reassuring news about Iran's nuclear program from the National Intelligence Estimate? Don't be so reassured, reports the New York Sun:

The director of national intelligence is backing away from his agency's assessment late last year that Iran had halted its nuclear program, saying he wishes he had written the unclassified version of the document in a different manner.

At a hearing yesterday of the Senate Select Committee on Intelligence, the intelligence director, Michael McConnell, said, "If I had 'til now to think about it, I probably would change a few things." He later added, "I would change the way we describe the Iranian nuclear program. I would have included that there are the component parts, that the portion of it, maybe the least significant, had halted." . . .

Yesterday, Mr. McConnell struck a different tone. "Declared uranium enrichment efforts, which will enable the production of fissile material, continue. This is the most difficult challenge in nuclear production. Iran's efforts to perfect ballistic missiles that can reach North Africa and Europe also continue."

He went on, "We remain concerned about Iran's intentions and assess with moderate-to-high confidence that Tehran at a minimum is keeping open the option to develop nuclear weapons."

The New York Times, which has been beating the drums for complacency, buries the Iran revelation in paragraphs 12-17 of a story on McConnell's testimony, getting to it only after a section about al Qaeda getting stronger in Pakistan and one on waterboarding. (Ho hum, we're waterbored.)

The mainstream media and elements in the intelligence community may well have succeeded in ensuring that there will not be serious action, military or otherwise, against Iran's nuclear program during the Bush administration. That ought to make John McCain, Barack Obama and Hillary Clinton nervous, for it is most likely that one of them will have to deal with the consequences.

U.S. Intelligence Chief Corrects Impression Given by NIE on Iran - Demetri Sevastopulo
Admiral Michael McConnell, director of national intelligence, told the Senate intelligence committee Tuesday that the November national intelligence estimate had concluded that Tehran had ceased only efforts to covertly enrich uranium and design nuclear warheads. "The only thing that they've halted was nuclear weapons design, which is probably the least significant part of the program," he said. McConnell said Iran continued to develop uranium enrichment technology and longer-range ballistic missiles. (Financial Times-UK)

See also U.S.: Iran Could Have Enough Uranium for Bomb in 2009, But More Likely After 2010 - Pete Williams
McConnell said the U.S. intelligence community assesses "with moderate-to-high confidence that Tehran at a minimum is keeping open the option to develop nuclear weapons." The earliest Iran would be technically capable of producing enough highly enriched uranium for a weapon is late 2009, but that's very unlikely, he said. More likely that date would be sometime between 2010 and 2015, he added. (NBC News)

ISRAEL'S SPY SATELLITE A SUCCESS

Israel's New Spy Satellite Transmits Top Quality Images - Yuval Azoulay (Ha'aretz)
Footage from Israel's TESCAR satellite, launched into space two weeks ago, was transmitted for the first time Wednesday.   The Israel Aerospace Industries (IAI) reported that the satellite, which could boost Israel's intelligence gathering capabilities regarding Iran, was working perfectly.

See also Israel Air Force Chief Warns Israeli Satellites Could Be Targeted in Orbit (Jerusalem Post)
Parties that are hostile to Israel could attempt to target Israeli satellites orbiting earth, Air Force commander Maj.-Gen. Eliezer Shkedi said Wednesday at a conference dedicated to the memory of Israeli astronaut Ilan Ramon.

IS U.N. LEAKING ISRAELI INTEL TO HEZBOLLAH?

UNIFIL leaks to Hizbullah worry IDF (JPost)
A day after two Katyusha rockets struck Shlomi in the Galilee, defense officials raised concerns Wednesday that information they were regularly passing on to UNIFIL and the Lebanese Armed Forces (LAF) was also making its way to Hizbullah.

According to the officials, the IDF regularly updates UNIFIL and the LAF on its assessments concerning Hizbullah's military buildup in southern Lebanon.

Unconnected to those concerns, on Tuesday two 107-mm. Katyusha rockets struck Shlomi. Defense officials said that an al-Qaida-inspired Palestinian group was the prime suspect in the attack.

"This is a difficult scenario," one official in Jerusalem said. "On the one hand, we count on UNIFIL and the LAF and therefore need to update them. On the other hand, there is always a concern that the information we supply them with will fall into the wrong hands."

As a result, the IDF is constantly debating the "depth" of the information it is willing to share with UNIFIL and the LAF, out of fear that due to the Lebanese Armed Forces connection, it will find its way to Hizbullah.

SEE ALSO: UN PEACEKEEPERS LEAKING ISRAELI INTEL TO HEZBOLLAH (MereRhetoric)

ISRAEL PSYCHIATRIST CONVICTED OF SPYING FOR HAMAS & IRAN

Psychiatrist admits spy attempt (JTA)
An Israeli army psychiatrist was convicted of trying to spy for Iran and Hamas.

The Tel Aviv District Court on Wednesday found David Shamir guilty of "illicit contacts with enemy entities" as part of a plea bargain.

Shamir, 45, and a reserve major in the military's mental health division, admitted contacting Hamas, Iran and Russia with offers to provide state secrets. There was no response to his overtures.

Shamir's sentencing was set for Jan. 17. He faces a maximum term of 25 years, though a shorter sentence is expected in light of the plea bargain.

ANOTHER ISRAELI-ARAB LEADER ACCUSED OF AIDING TERRORISM

Another Israeli-Arab leader accused of aiding terrorism
Politician joins slew of arrests for working with 'enemy agents' during wartime
By Aaron Klein
(WorldNetDaily.com)

JERUSALEM – An Israeli-Arab lawmaker was arrested earlier this week on suspicion he spied for the Lebanese Hezbollah terror organization, according to sources familiar with the case.
The arrest follows a slew of other arrests and convictions the past few years of Israeli-Arab activists and politicians accused of aiding terror groups or enemy countries during a time of war. It also follows a WND exclusive report quoting a terror leader stating Hezbollah has "tens" of spies, mostly Israeli Arabs, operating within the Jewish state.

It was cleared for publication yesterday that Niad Malhem, a member of the Knesset's Arab Balad party, was arrested Sunday on suspicion he committed serious security-related offences. Due to a gag order on the case, Israeli reporters were not briefed about the specifics of the accusations.

Sources familiar with the case told WND that, among other offenses, Malhem was accused of spying for Hezbollah during Israel's war against the terror group in July and August of 2006. The war was sparked when Hezbollah raided the Israeli border and kidnapped two Israeli soldiers. Hezbollah proceeded to fire over 3,000 rockets into the Jewish state, killing 43 Israeli civilians.

Malhem also traveled in October to Syria, considered an enemy country of Israel. The politician went along with another Balad Arab Knesset member, who was questioned about the duo's visit last weekend.

MORE ON NIE REPORT

Britain: Iran "Hoodwinked" CIA Over Nuclear Plans - Tim Shipman, Philip Sherwell and Carolynne Wheeler
British spy chiefs have grave doubts that Iran has mothballed its nuclear weapons program, as a U.S. intelligence report claimed last week, and believe the CIA has been hoodwinked by Teheran. The timing of the CIA report has also provoked fury in the British Government, where officials believe it has undermined efforts to impose tough new sanctions on Iran and made an Israeli attack on its nuclear facilities more likely.

The security services in London want concrete evidence to allay concerns that the Islamic state has fed disinformation to the CIA. The report used new evidence - including human sources, wireless intercepts and evidence from an Iranian defector - to conclude that Teheran suspended the bomb-making side of its nuclear program in 2003. But British intelligence is concerned that U.S. spy chiefs were so determined to avoid giving President Bush a reason to go to war - as their reports on Saddam Hussein's weapons programs did in Iraq - that they got it wrong this time. A senior British official delivered a withering assessment of U.S. intelligence-gathering abilities in the Middle East and revealed that British spies shared the concerns of Israeli defense chiefs that Iran was still pursuing nuclear weapons. (Telegraph-UK)

Israel Says Iran Could Have Nuclear Bomb by 2010 - Ari Rabinovitch (Reuters/Washington Post)
Israel believes Iran will have the resources to create a nuclear weapon by 2010 despite a U.S. intelligence report that it was not building an atomic bomb, Israeli Prime Minister Olmert said on Sunday.

"According to the (NIE) report, there was a nuclear weapons program until 2003, but there is no explanation where it disappeared," Olmert said at a cabinet meeting.

Olmert said Israel would continue seeking further sanctions against Iran, which he said would have enriched enough uranium to create a nuclear weapon by 2010.

Iran Intelligence Report: Garbage In, Garbage Out - Jeff Stein (Congressional Quarterly)
Richard Barlow, a top former CIA and Pentagon expert on Pakistan's clandestine nuclear program in the 1980s until he was hounded out of the government for telling the truth, points out that the NIE - or at least its unclassified summary - doesn't say at what stage the Iranians allegedly "halted" their weapons program in 2003.

"The entire NIE is meaningless without this being addressed," Barlow told me. "Its omission from the Key Judgments is so glaring as to be suspicious. These programs have these little 'stoppages' not that infrequently." "The reliability of the 'new intelligence,' reportedly based mainly on U.S. electronic intercepts of Iranian scientists complaining about the work stoppage, is being greatly overblown," Barlow maintains.

Just 18% Believe Iran Has Stopped Nuclear Weapons Development Program (Rasmussen Reports)
Just 18% of American voters believe that Iran has halted its nuclear weapons program. The latest Rasmussen Reports national telephone survey found that 66% disagree and say Iran has not stopped its nuclear weapons program.

The survey also found that 67% of American voters believe that Iran remains a threat to the national security of the U.S. Only 19% disagree. 59% believe the U.S. should continue sanctions against Iran. 20% disagree. 47% believe it is very likely that Iran will develop nuclear weapons in the future and another 34% believe Iran is somewhat likely to do so. An earlier survey found that 62% believe that Iran sponsors terrorist activities against the U.S. Only 6% disagree.

Iranian dissidents: Iran did stop its weapons program in 2003 — and restarted it in 2004 (HotAir)

MORE ON HEZBOLLAH'S FBI SPY

Inside Source at FBI Believed to Have Fed Secret Info to Hizbullah - Josh Meyer
An illegal immigrant from Lebanon who became an agent for the FBI and CIA allegedly used her access to sensitive U.S. government secrets to help her brother-in-law, a suspected major fundraiser for the terrorist group Hizbullah, according to new details concerning a national security breach that emerged Wednesday. In court documents and interviews, federal authorities said Nada Nadim Prouty, 37, illegally accessed top-secret FBI investigative files on five occasions and most likely shared the information with the suspected Hizbullah operative. On Wednesday, prosecutors said Prouty illegally accessed the FBI's Hizbullah investigative files in 2002 and 2003, at a time when she was a Washington, D.C.-based FBI field agent who was not working on Hizbullah cases. At the time, her sister's husband, Talal Khalil Chahine, 51, was under investigation by the FBI in Detroit for suspected ties to Hizbullah.

Authorities now believe Prouty was illegally accessing the FBI files to determine for Chahine and perhaps others what the FBI knew about the group's presence here, and that she accessed an investigative file on Chahine. At the time, Chahine was suspected of raising large sums of money for Hizbullah and of meeting with top Hizbullah leaders in Lebanon. The FBI began investigating Prouty after agents began hearing that Chahine, an influential power broker in Dearborn, had an inside source at the FBI who was feeding him information about its investigations into his activities and into Hizbullah. (Los Angeles Times)

"Arab Street," U.S.A. (Contentions)

An article in today’s Los Angeles Times reports new, sordid details in the investigation of Nada Nadim Prouty, a Lebanese woman—an illegal immigrant—who was nevertheless employed by the FBI and CIA, and is accused of stealing top-secret documents for Hizballah. Her brother-in-law, the paper reports, is a “suspected major fund-raiser” for Hizballah.

If that’s not shocking enough, the penultimate paragraph in the L.A. Times article contains very worrisome information, presumably placed in the article as background. “Hizballah is popular with many Lebanese Americans because of its humanitarian efforts and Middle East political activities.”

I thought the bit about Hizballah’s popularity was hyperbole, and I tried to find polling data that might back the statement up one way or another. Instead, I found this NPR story from last year. In the summer of 2006, it turns out, 15,000 Arab-Americans in Dearborn, Michigan, held a demonstration to declare their loyalties. When the crowd cheered “Who is your army?” The response was “Hizballah!” The editor of America’s largest Arab newspaper, the Arab-American News, chimed in that “the terrorist here is the Bush administration.” At the rally, swastikas were imprinted onto Israeli flags.

The second half of the sentence in the Los Angeles Times piece is terrifying for a different reason: its attempt at “objectivity.” Hizballah’s “political activities”? The old saying is that “war is politics by other means.” For Hizballah, an organization responsible for as many terror attacks against Americans as al Qaeda, terror is not simply “political activities” as other means, it is their only politics and their only means.

EVEN IAEA THINKS U.S. REPORT SOFT ON IRAN!

Monitoring Agency Praises U.S. Report, But Keeps Wary Eye on Iran - Elaine Sciolino
The International Atomic Energy Agency on Tuesday publicly embraced the new American intelligence assessment stating that Iran had halted its nuclear weapons effort, but in truth the agency is taking a more cautious approach. "To be frank, we are more skeptical," a senior official close to the agency said. "We don't buy the American analysis 100 percent. We are not that generous with Iran." The official called the American assertion that Iran had "halted" its weapons program in 2003 "somewhat surprising." (New York Times)

Why Does U.S. and Israeli Intelligence Differ? - Yaakov Katz
The U.S. intelligence report released Monday claimed that Iran froze its nuclear military track four years ago. Israel's Mossad claims that the Iranians will be able to develop a nuclear bomb by the end of 2009; IDF Military Intelligence warns that Teheran will cross the technological threshold within six months; and now the Americans are putting the timeline toward the middle of the next decade, or 2013 at the earliest. Defense officials in Tel Aviv admitted Tuesday that the report would probably embolden Iran.

The Americans are still traumatized by the blatant intelligence failure vis-a-vis Iraq's alleged WMD and do not want to be caught crying wolf again. Israel takes the more stringent track. As one defense official put it on Tuesday, "It is better to be safe than sorry." (JPost)

Alone on the Battlefield - Alex Fishman
They must be celebrating in Teheran. The American report claiming Iran froze its nuclear weapons development program in 2003 is a below-the-belt blow for the Israeli struggle in the international arena against Iranian nukes. Israeli defense officials fail to understand where the Americans got the idea that Iran has not renewed its nuclear weapons development process. The information available to Israeli and Western intelligence services shows that Iran, due to diplomatic pressures, indeed froze the process in 2003, but the same information shows that the efforts were renewed two years later and are continuing to this day.

Behind closed doors, Israeli defense officials are convinced that U.S. intelligence bodies are simply getting it wrong, both in terms of timetables as well as certain phases in the development of Iran's military nuclear capabilities. Israel has no intention to stop or slow down its preparations in response to a nuclear Iran - but now we may have to do this a bit more alone. (Ynet News)

The Thin Line Between Civilian and Military Nuclear Programs - William J. Broad (New York Times)
When is a nuclear program a nuclear weapons program? The open secret of the nuclear age is that the line between civilian and military programs is extraordinarily thin. One threshold is enriched uranium. Enriched to low levels, uranium can fuel a reactor that produces electrical power - which is what Tehran says it wants to do. But if uranium is purified in spinning centrifuges long enough, and becomes highly enriched, it can fuel an atom bomb.

Relax? Don't. Iran Can Still Build Its Bomb - Bronwen Maddox (Times-UK)
The newly published U.S. intelligence report supports fears that Iran could soon have nuclear weapons. It argues that Iran has been deterred from pursuing them mainly by the fear of U.S. military action, a fear that has now faded. The report makes clear the seriousness of the threat, not the opposite.

Was Bush Behind the Iran Report? - Robert Baer
Bombing Iran, it seems, is now off the table. There's no other reasonable take on the latest National Intelligence Estimate that concludes Iran halted its nuclear weapons program in 2003. But there is also no doubt that the Bush White House was behind this NIE and that a 180-degree turn on Iran like this one was greenlighted by the president. The real story behind this NIE is that the Bush Administration has finally concluded Iran is a bridge too far. With Iranian-backed Shi'a groups behaving themselves, things are looking up in Iraq.

Then there are the Gulf Arabs. For the last year and a half, ever since the Bush Administration started to hint that it might hit Iran, they have been sending emissaries to Tehran to assure the Iranians they're not going to help the U.S. But in private, the Gulf Arabs have been reminding Washington that Iran is a rabid dog: Don't even think about kicking it, the Arabs tell us. If you have to do something, shoot it dead. Which is something the U.S. can't do. So how far is Iran from a nuke? The truth is that Iran is a black hole, and it's entirely conceivable Iran could build a bomb and we wouldn't know until they tested it. (TIME)

U.S. BLOCKED LAUNCH OF ISRAELI SATELLITE

Report: US halted launch of Israeli satellite (JPost)
The September launch of an Israeli spy satellite from India, which now faces months of postponements, was canceled due to "last-minute" pressure by the United States, the Indian press reported Monday.

The TecSar satellite - developed and manufactured by Israel Aerospace Industries (IAI) - initially was supposed to be launched in September, on the heels of the June launch of the Ofek 7 spy satellite. It is the first Israeli satellite with Synthetic Aperture Radar (SAR) capabilities, a technology that allows the camera to take pictures of targets in all weather conditions.

Weighing just under 300 kilograms, the TecSar was developed by the IAI's Space Division MBT and has the ability to create images of objects on Earth even in cloudy weather conditions, a capability not available in Israel's Ofek satellite series.

The Ofek 7 is a camera-based satellite, while TecSar is capable of creating high-resolution images using advanced radar technology.

In an article published in Monday's Daily News and Analysis, the Indian paper quoted sources who said US government pressure was responsible for calling off the launch of the satellite, which already had been mounted on the space-bound missile launcher.

The paper hinted that the reason for the American pressure was to prevent India from obtaining powerful military platforms. Earlier this year, the paper said, the US curtailed Indian plans to develop missiles with a 5,000-kilometer range and advised it to only manufacture missiles with a range of 800 km.

IDF PSYCHIATRIST INDICTED FOR TRYING TO SPY FOR IRAN

IDF Psychiatrist (res.) Indicted for Attempting to Spy for Iran 
(IsraelNN.com) An IDF psychiatrist who serves as a reserve major in the army's medical corps, has been charged with trying to spy for the country that is most invested in destroying the State of Israel.

Maj. (res.) David Shamir, a 45-year-old resident of central Israel, was indicted in a Tel Aviv District Court Friday with offering his services as a spy for Iran and other foreign agents, for a fee. The charges include attempts at spying, contact with a foreign agent and obstruction of justice.

He was arrested by the General Security Service (Shin Bet) and the Police International Investigation Unit, which specializes in international security offenses.

The prosecution alleged that during his reserve service, Shamir saw classified materials, including emergency Medical Corps plans that showed the distribution of medical corps and control centers, plans for evacuation of civilians in case of a missile attack and various operational and intelligence assessments.

Shamir contacted the Iranian Foreign Office in April after deciding to sell the information to foreign agents in exchange for money. Several days later, the charge sheet continues, "he was contacted by the elements he had contacted." In August, he sent a fax with a similar offer from his home to the Iranian consulate in London and in Turkey. Having received no response, he allegedly re-sent the faxes in October.

The would-be spy also allegedly contacted FSB, the Russian intelligence agency, expressing his willingness to serve and asking about the recruitment process for spies.

On November 3, he also contacted the Hamas-controlled al-Azhar university in Gaza, saying he was an Israeli "interested in joining the struggle."

A search of Shamir's home turned up documents that backed up the allegations, and defense officials said the would-be spy confessed to having emailed the Iranian Foreign Ministry. He admitted to offering himself as an Israeli citizen and IDF officer with numerous contacts and who was interested in cooperating with the Islamic Republic for a fee.

The cooperation never materialized, according to Israeli officials.

MORE ON HEZBOLLAH MOLE

Not only is her sister a marine, but her husband works for the State Department. Oh, and her cousin is a terrorist and her family has ties to .... the Nazis. 

MORE ON THE CIA/FBI HEZBOLLAH SPY

How big a role did disgraced CIA officer have?
Prouty was assigned a sensitive post in Baghdad, NBC News has learned

There’s new information about the young Lebanese woman who pleaded guilty Tuesday to charges she lied about her background to get jobs at the FBI and CIA.

Current and former intelligence officials tell NBC News that Nada Nadim Prouty had a much bigger role than officials at the FBI and CIA first acknowledged. In fact, Prouty was assigned to the CIA’s most sensitive post, Baghdad, and participated in the debriefings of high-ranking al- Qaida detainees.

A former colleague called Prouty “among the best and the brightest” CIA officers in Baghdad. She was so exceptional, agree officials of both agencies, the CIA recruited her from the FBI to work for the agency’s clandestine service at Langley, Va., in June 2003. She then went to Iraq for the agency to work with the U.S. military on the debriefings...

Although no one claims Prouty worked for Hezbollah, her computer searches led U.S. officials to question her. She looked up files on her sister, Elfat El Aouar, and brother-in-law, Talal Khalil Chahine, both of whom attended a Hezbollah fundraiser in Lebanon — alongside Hezbollah spiritual leader Sheikh Muhammad Hussein Fadlallah, designated by the U.S. as a terrorist.

Chahine is currently a fugitive believed to be in Lebanon. He, along with Prouty’s sister and others, was charged in 2006 by the U.S. attorney in Detroit with tax evasion in connection with a scheme to conceal more than $20 million in cash received by La Shish restaurants in suburban Detroit and to route funds to persons in Lebanon with links to Hezbollah.

Moreover, as she was moving between agencies in 2003, Prouty accessed the FBI’s Automated Case Support system and obtained information on investigations into Hezbollah being conducted by the FBI’s Detroit Field Office.

National security experts say the combination of her being at one of the CIA’s most sensitive stations, working on some of the agencies' most sensitive cases, and having her relatives under investigation put her in a vulnerable position — and make the potential damage she could have caused far greater than either the FBI or CIA has admitted.

FBI/CIA AGENT ACCUSED OF SECURITY BREACH, HEZBOLLAH TIES

Ex-FBI Agent Accused Of Security Breach
(CBS/AP) A former agent for the FBI and CIA pleaded guilty Tuesday to faking a marriage to win U.S. citizenship, clearing the way to being hired and given security clearances by the two intelligence agencies.

Nada Nadim Prouty, 37, emigrated to United States from Lebanon in 1989. She was given U.S. citizenship five years later and began working as a special agent at the FBI's field office in Washington in 1999, according to a criminal information sheet filed in U.S. District Court in Detroit.

While working as a special agent, Prouty improperly searched an FBI computer database for information about her relatives and links they might have to the Hezbollah terrorist organization, the criminal sheet showed. She joined the CIA in 2003 and resigned as part of her guilty plea Tuesday, officials said.

There's no evidence that Prouty was working as a spy on Hezbollah's behalf, two government officials said.

However, "This still continues to be an ongoing investigation," said FBI spokesman Stephen Kodak in Washington....

Prouty was not authorized to search the FBI database, in 2002, for her name and that of her sister and brother-in law. Her relatives were linked to Hezbollah two years later when they joined a senior Hezbollah official at a fundraiser.

Prouty's brother-in-law Talal Chanine spoke at that fund raiser in Lebanon alongside Hezbollah's one-time spiritual leader Sheikh Fadlallah, reports CBS News correspondent Bob Orr.

Prouty joined the CIA in 2003. CIA spokesman Mark Mansfield described Prouty as a "midlevel employee" who violated immigration laws long before she was hired by the government.

The CIA is cooperating with the investigation, Mansfield said.

Prouty pleaded guilty to conspiracy, unauthorized computer access and naturalization fraud.

ISRAEL HAD SPY AT SYRIAN NUKE FACILITY

Report: Israel Had Man on Inside of Syrian Nuclear Facility (INN)
The latest in the string of foreign press reports regarding the Sept. 6 strike in Syria claims Israel had a mole inside a Syrian nuclear facility.

Report: Israel Says Syrian Target Was Nuke Facility (FOXNEWS)

Israel claims that one of the Syrian targets they allegedly bombed last month was a nuclear facility after receiving detailed photos from a possible spy in the building, ABCNews.com reported Friday.

The Bush administration, meanwhile, has refused to confirm the existence of such a facility or comment in detail on the photographs. A senior U.S. official told ABCNews.com that Israel’s intelligence agency discovered a suspected nuclear facility inside Syria over the summer, and may have planted a spy—posing as an employee—inside the complex.

The pictures obtained by Israel show a big cylindrical structure with thick walls that closely resembles a North Korean design, a U.S. official told ABCNews.com.

The official said the facility was approximately 100 miles from the Iraqi border, and a place “where no one would ever go unless you had a reason to go there,” ABCNews.com reported.

ISRAEL FLIGHT OVER SYRIA TO TEST RUSSIAN MISSLE SYSTEM?

Advanced Russian Air Defense Missile Cannot Protect Syrian and Iranian Skies (DEBKA)

The purported Israeli air force flights over the Pantsyr-S1E site established that the new Russian missiles, activated for the first time in the Middle East, are effective and dangerous but can be disarmed. Western military sources attribute to those Israeli or other air force planes superior electronics for jamming the Russian missile systems, but stress nonetheless that they were extremely lucky to get away unharmed, or at worst, with damage minor enough for a safe return to base.

The courage, daring and operational skills of the air crews must have been exceptional. They would have needed to spend enough time in hostile Syrian air space to execute several passes at varying altitudes under fire in order to test the Pantsyr-S1E responses. Their success demonstrated to Damascus and Tehran that their expensive new Russian anti-air system leaves them vulnerable.

Washington like Jerusalem withheld comment in the immediate aftermath of the episode. After its original disclosure, Damascus too is holding silent. Western intelligence sources believe the Syrians in consultation with the Russians and Tehran are weighing action to gain further media mileage from the incident. They may decide to exhibit some of the “ammunition” dropped by the Israeli aircraft as proof of Israel’s contempt for international law. A military response may come next.

HAS ISRAEL KIDNAPPED SHALIT'S KIDNAPPER?

Report: Israeli troops disguised as Palestinian grocers kidnap Gilad Shalit’s kidnapper
(HotAir)

No confirmation from the IDF but I bet it’s true. Ehud Barak is internationally famous for his participation in raids like these behind enemy lines, most notoriously when he dressed as a woman to assassinate PLO leaders in Beirut in 1973. He took over as defense minister from the much-maligned Amir Peretz less than three months ago; this is probably his way of leaving a calling card for Hamas.

Pretty awesome:

The sources said that the undercover soldiers entered the Gaza Strip, and carried out their operation near the Rafah Crossing. According to the sources, the undercover soldiers were disguised as grocers riding a donkey-pulled wagon. Sources said they disguised force even chatted with locals near the crossing.

According to the report, the undercover soldiers approached a plot of land belonging to Muhawesh al-Kadi, a senior Hamas official who acts as spokesman of the organization’s special security forces in Rafah.

Al-Kadi was working his land when the disguised force approached and kidnapped him. The Palestinian sources reported that the operation went quickly and smoothly. The undercover force left Rafah with al-Kadi, and brought him to Israel.

According to the report, the operation was carried out about 2 kilometers from the security fence, in an area where a large number of Hamas gunmen are stationed.

Hamas officials confirmed that this was one of the Israelis’ most daring acts and that troops disguised as Arabs had not entered so deep into the Strip for a long time.

Will they kill Shalit as a reprisal? Probably not. They can’t afford to invite an IDF offensive when they’re still worried about controlling the Gaza strip. I wonder if Israel will offer al-Kadi as part of the prisoner exchange.

Meanwhile, Debka floats a not-unlikely theory about that strange Israeli flyover of Syria a few days ago. Apparently, the IAF was able to jam the Russian-made Syrian anti-aircraft system; it so happens that Iran has the same system. You do the math.

HOLY LAND FOUNDATION TRIAL TURNS TO ISRAELI AGENT

Holy Land Trial Turns to Israeli Agent - Jason Trahan
The federal judge presiding over the Holy Land Foundation terror finance trial ordered his courtroom cleared of spectators Thursday as a secret agent for the Israel Defense Forces took the stand. The agent testified about a cache of documents, videos and posters that his team of commandos seized during raids on several charity committees in the Palestinian territories between 2002 and 2004. Prosecutors say these committees are controlled by Hamas and contend that Holy Land's support of them amounts to illegal support of terrorists. Prosecutors are expected to get into the details of what is in the evidence later, when an agent with the Israeli Security Agency is to testify in the case. (Dallas Morning News)

HOW THE KGB CREATED ARAFAT AND THE PLO

From Russia With Terror (FrontPage) (via Atlas Shrugs)
Frontpage Interview’s guest ... is Ion Mihai Pacepa, former acting chief of Communist Romania’s espionage service. ...

FP: Tell us about the PLO and its connection to the Soviet regime.

Pacepa: The PLO was dreamt up by the KGB, which had a penchant for “liberation” organizations. There was the National Liberation Army of Bolivia, created by the KGB in 1964 with help from Ernesto “Che” Guevara. Then there was the National Liberation Army of Colombia, created by the KGB in 1965 with help from Fidel Castro, which was soon deeply involved in kidnappings, hijackings, bombings and guerrilla warfare. In later years the KGB also created the Democratic Front for the Liberation of Palestine, which carried out numerous bombing attacks on the “Palestinian territories” occupied by Israel, and the “Secret Army for Liberation of Armenia,” created by the KGB in 1975, which organized numerous bombing attacks against US airline offices in Western Europe.

In 1964 the first PLO Council, consisting of 422 Palestinian representatives handpicked by the KGB, approved the Palestinian National Charter—a document that had been drafted in Moscow. The Palestinian National Covenant and the Palestinian Constitution were also born in Moscow, with the help of Ahmed Shuqairy, a KGB influence agent who became the first PLO chairman. (During the Six-Day War he escaped from Jerusalem disguised as a woman, thereafter becoming such a symbol within the bloc intelligence community that one of its later influence operations—aimed at making the West consider Arafat a moderate—was given the codename “Shuqairy.”) This new PLO was headed by a Soviet-style Executive Committee made up of 15 members who, like their comrades in Moscow, also headed departments. As in Moscow—and Bucharest—the chairman of the Executive Committee became the general commander of the armed forces as well. The new PLO also had a General Assembly, which was the Soviet-inspired name given to all East European parliaments after World War II.

Based on another “socialist division of labor,” the Romanian espionage service (DIE) was responsible for providing the PLO with logistical support. Except for the arms, which were supplied by the KGB and the East German Stasi, everything else came from Bucharest. Even the PLO uniforms and the PLO stationery were manufactured in Romania free of charge, as a “comradely help.” During those years, two Romanian cargo planes filled with goodies for the PLO landed in Beirut every week, and were unloaded by Arafat’s men.

FP: You have discussed your personal knowledge of how Arafat was created and cultivated by the KGB and how the Soviets actually designed him to be the future leader of the PLO. Illuminate this picture for us please.

Pacepa: “Tovarishch Mohammed Abd al-Rahman Abd al-Raouf Arafat al-Qudwa al-Husseini, nom de guerre Abu Ammar,” was built into a Palestinian leader by the KGB in the aftermath of the 1967 Six-Day Arab-Israeli War. In that war Israel humiliated two of the Soviet Union’s most important allies in the Arab world of that time, Egypt and Syria, and the Kremlin thought that Arafat could help repair the Soviet prestige. Arafat had begun his political career as leader of the Palestinian terrorist organization al-Fatah, whose fedayeen were being secretly trained in the Soviet Union. In 1969, the KGB managed to catapult him up as chairman of the PLO executive committee. Egyptian ruler Gamal Abdel Nasser, who was also a Soviet puppet, publicly proposed the appointment.

Soon after that, the KGB tasked Arafat to declare war on American “imperial-Zionism” during the first summit of the Black International, an organization that was also financed by the KGB. Arafat claimed to have coined the word “imperial-Zionism,” but in fact Moscow had invented this battle cry many years earlier, combining the traditionally Russian anti-Semitism with the new Marxist anti-Americanism.

FP: Why has the American and Israeli leadership been deceived so long about Arafat’s criminal and terrorist activities?

Pacepa: Because Arafat is a master of deceit—and I unfortunately contributed to that. In March 1978, for instance, I secretly brought Arafat to Bucharest to involve him in a long-planned Soviet/Romanian disinformation plot. Its goal was to get the United States to establish diplomatic relations with him, by having him pretend to transform the terrorist PLO into a government-in-exile that was willing to renounce terrorism. Soviet president Leonid Brezhnev believed that newly elected US president Jimmy Carter would swallow the bait. Therefore, he told the Romanian dictator that conditions were ripe for introducing Arafat into the White House. Moscow gave Ceausescu the job because by 1978 my boss had become Washington’s most favored tyrant. “The only thing people in the West care about is our leaders,” the KGB chairman said, when he enrolled me in the effort of making Arafat popular in Washington. “The more they come to love them, the better they will like us.”

“But we are a revolution,” Arafat exploded, after Ceausescu explained what the Kremlin wanted from him. “We were born as a revolution, and we should remain an unfettered revolution.” Arafat expostulated that the Palestinians lacked the tradition, unity, and discipline to become a formal state. That statehood was only something for a future generation. That all governments, even Communist ones, were limited by laws and international agreements, and he was not willing to put any laws or other obstacles in the way of the Palestinian struggle to eradicate the state of Israel.

My former boss was able to persuade Arafat into tricking President Carter only by resorting to dialectical materialism, for both were fanatical Stalinists who knew their Marxism by heart. Ceausescu sympathetically agreed that “a war of terror is your only realistic weapon,” but he also told his guest that, if he would transform the PLO into a government-in-exile and would pretend to break with terrorism, the West would shower him with money and glory. “But you have to keep on pretending, over and over,” my boss emphasized.

Ceausescu pointed out that political influence, like dialectical materialism, was built upon the same basic tenet that quantitative accumulation generates qualitative transformation. Both work like cocaine, let’s say. If you sniff it once or twice, it may not change your life. If you use it day after day, though, it will make you into an addict, a different man. That’s the qualitative transformation. And in the shadow of your government-in-exile you can keep as many terrorist groups as you want, as long as they are not publicly connected with your name.

In April 1978 I accompanied Ceausescu to Washington, where he convinced President Jimmy Carter that he could persuade Arafat to transform his PLO into a law-abiding government-in-exile, if the United States would establish official relations with him. Thereupon, President Carter publicly hailed Ceausescu as a “great national and international leader” who had “taken on a role of leadership in the entire international community.”

Three months later I was granted political asylum by the United States, and Romania’s tyrant lost his dream of getting the Nobel Peace Prize. A quarter of a century later, however, Arafat remains in place as the PLO chairman and seems to still be on track with the Kremlin’s game of deception. In 1994, Arafat was granted the Nobel Peace Prize because he agreed to transform his terrorist organization into a kind of government-in-exile (the Palestinian Authority) and pretended, over and over, that he would abolish the articles in the 1964 PLO Covenant that call for the destruction of the state of Israel and would eradicate Palestinian terrorism. At the end of the 1998-99 Palestinian school year, however, all one hundred and fifty new schoolbooks used by Arafat’s Palestinian Authority described Israel as the “Zionist enemy” and equated Zionism with Nazism. Two years after the Oslo Accords were signed, the number of Israelis killed by Palestinian terrorists rose by 73% compared to the two year period preceding the agreement.

FP: There simply can’t be any kind of peace in the Middle East with Arafat at the helm. What advice would you give to American and Israeli diplomats now?

Pacepa: To expose Arafat’s lies and condemn his bloody terrorism, but to avoid being implicated in physical reprisals against him—that would certainly make him a hero with the Palestinians. I strongly suggest the Ceausescu solution. In November 1989, when he was loudly reelected president of Romania, Ceausescu was as popular there as Arafat is now with the Palestinians. A month later, however, Ceausescu was tried for genocide by his own people and executed by his own people. From one day to the next Ceausescu became the symbol of tyranny. Romania turned into a free country, and twelve years later it was invited to join NATO.