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The Wen Ho Lee saga began in 1995, when a walk-in source gave the CIA a document from the People's Republic of China that claimed Chinese weapons designers had obtained specific and highly classified details of an American nuclear warhead known as the W-88. Not everyone in the intelligence community was convinced the document was genuine. The DOE and the FBI, which handles spy catching, quickly learned that several agencies and some defense contractors had information about the W-88, and concluded that the leak had probably occurred at the weapons lab at Los Alamos, where most of the data were cached. DOE officials compiled a list of about 12 people who had both access to the material and contact with Chinese officials and scientists. On the list was Wen Ho Lee.
Nailing spies is hard. To stand a chance of putting them behind bars, you almost have to catch them in the act of forking over secrets. But in the Los Alamos case, the damage was already done, and so agents had to find a way to "walk the cat back," as they like to say, and prove the crime in retrospect. That makes spy catching even harder, but the FBI didn't do itself any favors. Bureau sources concede that when the probe was opened in May 1996, it was left to second-string agents. "It was dumb and dumber," says a bureau veteran. "They put the wrong people to investigate it, and they didn't give it sufficient oversight from headquarters."
Perhaps that's why Reno cast a skeptical eye on the case against Lee. Reno's seven years at Justice--she's the longest-serving Attorney General ever--have made her the loneliest woman in Washington. The White House long ago concluded that she is aloof and politically tone-deaf, but those qualities helped her stand out in an Administration that often lacked ethical bearings. Aides admit she has a social worker's soft side that often gets the better of her, as it did in her handling of the Elian Gonzalez case. And congressional Republicans regard her by-the-book reading of laws as a knee-jerk reluctance to prosecute--especially when questions are raised about her bosses.
And so, true to form, in July 1997, Reno's staff turned down the FBI's request for permission to search Lee's computer because the agents lacked the "probable cause" evidence required by law. The agency appealed to Reno, who refused to budge. Her decision was correct, but FBI grumbling about it made its way, as many FBI complaints do, to Capitol Hill. There, congressional Republicans who were already angry at Reno for dragging her feet on another probe involving China--the 1997 investigation into the highly creative Clinton-Gore fund-raising practices during the 1996 campaign--began to keep a watch on the Los Alamos case.
While the pot boiled in Washington, the FBI's probe in New Mexico was going nowhere in 1998. At one point, the bureau allowed the DOE to have Lee polygraphed by a private security firm, which concluded that Lee was telling the truth. When DOE and FBI agents looking at the same results disagreed, alarmed DOE officials assigned Lee to another, unclassified job. The feds still lacked any evidence that Lee had spied or even stolen anything, and so they kept their sleuths on the case.