In the 2008 comedy Burn After Reading, Brad Pitt and Francis McDormand play two clueless gym employees who try (and fail) to make money selling government secrets. And while bribery, espionage and money laundering sound like all the good plot points for any spy comedy, you don’t expect to find them in the real world – with real government employees trying to sell real secrets.
In fact, you’d think FBI agents or members of the U.S. military would never get involved in dealings like these. After all, isn’t their job to protect the United States from stuff like this?
Recently, three individuals were convicted of committing these types of acts. What would transpire to cause these people to even think of betraying their country? What do they gain by giving away secrets or violating U.S. sanctions? Let’s find out.
The Oligarch and the FBI Agent
Charles McGonigal, who was a Special Agent in Charge (SAC) of the FBI’s Counterintelligence Division in New York, pleaded guilty to conspiring to violate the International Emergency Economic Powers Act (IEEPA) and money laundering from a connection with his 2021 agreement to provide services to a sanctioned Russian oligarch named Oleg Deripaska.
According to the Justic Department, McGonigal helped investigate Deripaska and other Russian oligarchs while he was an FBI agent. He then agreed to provide services of investigating another rival Russian oligarch for Deripaska in return for concealed payments. During the course of McGonigal’s agreement to work with Deripaska, he tried to conceal Deripaska’s involvement by not naming him on an electronic information, forging signatures and using shell companies to send and receive payments.
As a result of McGonigal’s activities, the former agent agreed to pay $17,500 – an amount representing the traceable payments received for the offenses. He also faces up to five years in prison for each count against him, as well as potential fines ranging from $20,000 to $200,000.
The Sailor Spies
U.S. Navy Sailor Jinchao Wei (aka “Patrick Wei”) was arrested on espionage charges. He is accused of conspiracy to send national defense information to an intelligence officer working for the People’s Republic of China.
As a Machinist’s Mate on the USS Essex, Wei had a security clearance with access to sensitive defense information about the ship’s weapons, propulsion, and desalination systems. The PRC intelligence officer had requested that Wei provide this information to him. Wei obliged and sent the officer photographs and videos of the Essex, as well as disclosing the locations of other U.S. Navy ships. He also described the defensive weapons used on the Essex and turned over approximately 30 technical and mechanical manuals during this time.
According to the Justice Department, Wei allegedly received $5,000 over the course of the conspiracy. The indictment t alleges that Wei knowingly violated the International Traffic in Arms Regulations (ITAR) by transmitting the manuals to a Chinese Officer without obtaining the required license to do so.
The second Navy person, Petty Officer Wenheng Zhao (aka “Thomas Zhao”) was arrested and charged with receiving bribes in exchange for transmitting sensitive U.S. military information to a person posing as a maritime researcher. (The researcher was actually another intelligence officer from the People’s Republic of China.) Zhao allegedly sent “controlled operational plans for a large-scale US military exercise in the Indo-Pacific Region.” It detailed specific locations and timing of the Naval movements, landings as well as operational support.
DOJ alleges that Zhao received almost $15,000 for this information. He faces a maximum penalty of 20 years in prison.
You can read more information about the cases against Wei and Zhao here. Also, this isn’t the first time U.S. Navy personnel were caught in the act of espionage. Read more about our coverage of the FBI and the sandwich spy.
So, why did they do it? Why would anyone violate the laws to help protect the U.S. interests and sensitive classified information? In all these cases, each person received some sort of financial benefit, but at what cost now? Only these people will truly know the answers to these questions.
You might not be one for the espionage or bribery, but you do need to make sure that your company doesn’t violate any of the export regulations, and that you have the proper license to export not only the physical products, but also the technical information as well.
Need help? Schedule a no-charge consultation with our team today.
Shawna Karajic is a Trade Compliance Consultant for Export Solutions -- a full-service consulting firm specializing in U.S. import and export regulations.