FBI SAYS SPY SUSPECT ADMITS SELLING DATA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000100310026-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: January 6, 2012
• Sequence Number: 26
• Publication Date: November 26, 1985
• Content Type: OPEN SOURCE

Declassified in Part - Sanitized Copy Approved for Release 2012/01/06: CIA-RDP90-00965R000100310026-2
3 RPM APPEARED WASHINGTON POST
ON PAGE-A 1. 26 November 1985
FBI Says Spy Suspect
Admits Selling Data
Yurchenlco's Disclosures Led to Pelton
~j By Susan Schmidt
and Patrick
ftm ~ W ~riters
s W
Pelton, a sandy-haired man gray-
ing slightly at the temples, said lit-
tle at the brief court hearing.
According to an FBI affidavit
A former communications sp'e- presented during the hearing. Pei-
cialist who spent 14 years working ton admitted he made contact with
for the highly secret U.S. National the Soviets in January 1980, the
Security Agency has admitted sell- year after he left the NSA at a sal-
ing what the government described ary of $24,500 in the midst of "se-
as "extremely sensitive" intent- rious financial troubles." He subse-.
gence information to the Soviet quently made several trips to Vien-
Union during the last five years, na, where he stayed at the home of
according to documents filed yes- the Soviet ambassador and was de-
terday in U.S. District Court in Bal- briefed at length by KGB agents,
timore. according to the FBI.
Ronald William Pelton, 44, who Pelton had worked for the NSA
was arrested early yesterday at the from November 1965 until July
Annapolis Wilton Hotel, was iden- 1979. The NSA, headquartered at
tilled as a Soviet spy earlier this Fort Meade, Md., north of Wash-
year based on information from So- ington, is the largest and most se-
viet KGB official Vitaly S. Yur- cret U.S. intelligence agency. It
chenko, according to Assistant FBI houses the U.S. government's larg-
Director William Baker. Yurchenko est and most sophisticated super-
asked for political asylum here in computers designed to crack en-
August, then abruptly decided to coded foreign military and diplomat-
return to the Soviet Union in early is messages gathered by tens of
November. thousands of employes worldwide.
Pelton, who was arraigned yes- In addition to his top secret clear-
terday, is the 14th person in the ance, Pelton had clearances "for
country charged with espionage special compartmented information
this year, including three last week. relating to signals intelligence," and
Baker said the recent arrests are was the author of a 1978 classified
partially a result of an increased document "concerning technical in-
number of FBI agents assigned to formation about the Soviet Union,"
counterintelligence duty and a according to the affidavit.
"higher priority" in the FBI and Jus- Intelligence sources said yester-
tice Department to prosecute es- day that Pelton's access to sensitive
pionage suspects. electronic eavesdropping systems
Fred W. Bennett, the public de- and procedures represented a "se-
fender who represented convicted rious loss" to U.S. intelligence.
spy John Anthony Walker Jr., was Sources said it appears Pelton may
appointed by the court as Pelton's have told the Soviets details of col-
lawyer. If convicted of the charges lection systems, such as spy satel-
against him, Pelton could face life lites and electronic listening posts
imprisonment. in foreign countries or on spy
Bennett said statements to the planes and ships.
FBI should not be characterized as The FBI said Pelton approached
a confession. "There are number the Soviets four months after filing
of potential defenses," Bennett said. for bankruptcy in which he listed
He said he hasn't seen tran- debts of $64,650, including first and
scripts "of any statements [Pelton] second mortgages on a Howard
allegedly made. We can't tell if they County home he valued at $31,000,
will be admissible ae,evidence." and credit card bills for gasoline,
home furnishings and other items.
At the time of bankruptcy, Pelton
said he had only $6.80 in cash and
$8 in a checking account. He listed
his other assets as four old cars, a
motorcycle, a $10 watch, a bowling
ball, five pairs of shoes and a razor.
The affidavit gave the following
account: Pelton's mission with the
Soviets began with a trip to the So-
viet Embassy in Washington. At
that 1980 meeting, he agreed to
sell them information and told them
about a U.S. intelligence collection
project targeted at the Soviet
In October 1980, and in January
1983, Pelton traveled to Vienna and
stayed in the Soviet ambassador's
apartment in the Soviet Embassy
compound there. He told the FBI he
received a call at his Silver Spring
home from a contact who arranged
for. the 1983 trip.
Pelton said that on each occasion
in Vienna, he spent three to four
days in debriefing sessions with
KGB agent Anatoly Slavnov. He
spent about eight hours a day with
Slavnov, providing written answers
to questions submitted in writing by
Slavnov. Pelton said he was ques-
tioned about nearly every area of
sensitive information he had access
to at NSA, including the document
on the Soviet Union he wrote in
1978.
Pelton admitted receiving cash in
exchange for the information, spe-
cifically $15,000, during the 1983
visit. The FBI said bank records
show he opened a new bank account
in March 1983 and subsequently
made two $5,000 cash deposits. It
could not be determined how much
Pelton allegedly received in total
from the Soviets.
Pelton also told the FBI that he
spent three days in Vienna in April
of this year but was unable to meet
with a Soviet agent then. He said
that when he returned, he got an-
other call at home from a Soviet
contact who asked that he make
another trip to Vienna in October.
The affidavit does not state wheth-
er that trip ever took place.
A senior FBI official said yester-
day that federal agents did not have
Pelton's name when the investiga-
Declassified in Part - Sanitized Copy Approved for Release 2012/01/06: CIA-RDP90-00965R000100310026-2
 Declassified in Part - Sanitized Copy Approved for Release 2012/01/06: CIA-RDP90-00965R000100310026-2
Ronald W. Pelton, right, is led from Anne Arundel detention center by FBI agent.
tion began after Yurchenko's Au-
gust defection.
"After we got the initial leads
from Yurchenko, it took a lot of
time and detective work with a lot
of cooperation from NSA before we
were able to zero in" on Pelton, as-
sistant director Baker said.
"It is typical in espionage cases to
confront the individual," Baker said,
because a successful confrontation
allows the FBI counterintelligence
officials then to consider whether to
bring a case against the suspected
spy or to use the leverage gained to
turn him into a double agent.
Information from Yurchenko also
pointed to Edward L. Howard, a
former CIA employe, who was
charged with selling secrets to the
Soviets but fled the country before
he could be arrested.
At home in the Washington area,
Pelton was a business entrepreneur
who shifted jobs and residences
with some frequency. Bennett, his
attorney, said Pelton is estranged
from his wife, who lives in Gaithers-
burg with two of their four children.
Pelton told the landlord of his
Dupont Circle apartment that he
had an interest in a company, Glad-
hill Tractor Mart, and his rent
checks had the company's name
inscribed across the top.
But Maurice Gladhill, owner and
president of the Frederick, Md.,
firm, said yesterday he "never saw
or heard or Pelton. He said he has
not used the name "Gladhill Tractor
Mart" since 1983, when he incor-
porated the business and received
new business identification num-
bers. At that time, he said, he
changed the firm's name to "Glad-
hill Tractor Mart Inc."
The landlord, who asked not to
be identified, said Pelton, who
rented a furnished English base-
ment apartment at 1704 19th St.
NW, seemed self-assured. The
landlord said Pelton talked "with a
great deal of pride" about a health
club, of which he was president,
called Health and Fitness of
Georgetown.
"He talked a lot about being
healthy ... about how he had shed
a great deal of weight. He spoke
with a great deal of authority," the
landlord said.
Pelton signed a year's lease to
rent the one-bedroom apartment
for $760 a month in October, ac-
cording to the landlord. But he ap-
peared never to really live there,
the landlord said.
"I never detected any personal
effects," said the landlord, who vis-
ited the apartment in early Novem-
ber. "I remember seeing a newspa-
per and some food, that's all."
Just a few weeks after he had
signed the lease, the landlord said,
Pelton insisted he had to break it
because he was buying a boat busi-
ness in Annapolis and the apartment
was too far away. Attorney Bennett
said Pelton has been living on a
houseboat in Annapolis recently.
Pelton also complained that some-
one had broken into his Lincoln Con-
tinental when he had parked it on the
street, the landlord said.
Pelton has been drawing a $600-
a-week advance on commissions at
Safford Yacht Sales, where he had
worked as a salesman for two
months, according to defense attor-
neys, and has no other assets except
the 1979 Lincoln valued at $1,000.
Further details of the case against
Pelton are expected to emerge in a
bond hearing set for tomorrow. He is
currently in federal custody in the
Baltimore City Jail.
U.S. intelligence has suffered
several losses from its top secret
eavesdropping programs, both of
them involving spy satellites.
In January 1977 federal author-
ities discovered that a code room
clerk at a top secret defense con-
tractor facility of TRW Inc. in Cal-
ifornia had been selling technical
data about the Rhyolite series of
spy satellites, which allow NSA to
sort through millions of telephone
and radio communication signals in
the Soviet Union from outer space.
The code room clerk, Christo-
pher J. Boyce, then 22, and his boy-
hood friend, Andrew Dalton Lee,
are currently serving prison terms
in that spy case, which was popu-
larized by the book and movie: "The
Falcon and the Snowman."
James Bamford, author of "The
Puzzle Palace," a history of NSA,
said in an interview that while it is
too early to tell what kind of secrets
Pelton had access to over his 14-year
career, there is a strong likelihood
that he would be able to tell the So-
viets a great deal about NSA eaves-
dropping activities arbund the world.
Bamford pointed out that all NSA
employees have at minimum a top
secret-signals security clearance
that requires a special background
investigation.
"The worst case," Bamford said,
"is that he might be able to tell the
Russians that we are able to inter-
cept, for instance, the link between
Moscow and the submarine bases at
Vladivostok" or some other sensi-
tive military link.
Bamford added that someone
with top secret-signals intelligence
clearance also could compromise
which coded military channels NSA
can intercept and decipher on a reg-
ular basis.
"It sounds like he worked in at-
tacking Soviet communications,"
Bamford said, adding that the key
to understanding the damage he
may have done to U.S. intelligence
would be in reconstructing all the
top secret programs he had worked
on for more than a decade.
Staff writers John Mintz and
Sharon LaFraniere contributed to
this report.
al.
Declassified in Part - Sanitized Copy Approved for Release 2012/01/06: CIA-RDP90-00965R000100310026-2