Dirtier than Watergate

The Reagan-era espionage system that has managed to stay under the radar.

It was described as dirtier than Watergate, and involved US government dealings with Iraq, Libya, Korea and even the late British publishing tycoon Robert Maxwell. The story is deep, dark and complex; a web of strange dealings and dubious characters, it implicates wealthy arms dealers, Israeli intelligence services, the Soviet KGB, MI5 and the CIA. But unlike Watergate, this scandal, from a particularly dark chapter in American history, has appeared in no Hollywood film and is yet to reach a satisfying conclusion.

It began in the late 1970s, when the Washington-based software developer Inslaw pioneered people-tracking technology, designed to be used by prosecutors to monitor case records. Known as the Prosecutor's Management Information System (PROMIS), the software was developed under grants from the US department of justice. The US government, as it helped fund the creation of PROMIS, had been licensed to use the software on condition that it did not modify, distribute or create derivative versions of it. The government, however, did not stick to this agreement.

Under the Ronald Reagan administration's covert intelligence initiative known as "'Follow the Money", the US National Security Agency (NSA) misappropriated PROMIS for sale to banks in 1982. The version of PROMIS sold by the NSA had been "espionage-enabled" through a back door in the programme, allowing the agency to covertly conduct real-time electronic surveillance of the flow of money to suspected terrorists and other perceived threats to US national interests.

A letter from the US department of justice in 1985, later obtained by Inslaw, documented more plans for the covert sale and distribution of the espionage-enabled version of PROMIS, this time to governments in the Middle East (which would surreptitiously allow the US to spy on foreign intelligence agencies). The letter outlined how sales of the software were to be facilitated by the late Saudi billionaire Khalid bin Mahfouz and the arms dealers Adnan Khashoggi and Manucher Ghorbanifar. PROMIS should be delivered without "paperwork, customs, or delay", it stated, and all of the transactions paid for through a Swiss bank account.

In the years that followed, friends of then attorney general Edwin Meese, including a Reagan associate, Dr Earl Brian of the government consultancy firm Hadron, Inc, were reportedly allowed to sell and distribute pirated versions of PROMIS domestically and overseas. As a House judiciary committee report found in 1992, these individuals were apparently permitted to do so "for their personal financial gain and in support of the intelligence and foreign policy objectives of the United States".

Brian, who was later jailed for four years on an unrelated fraud charge in 1998, has since denied any association with the Inslaw case. According to the former arms broker and CIA "contract operative" Richard Babayan, however, he was instrumental in selling PROMIS to the governments of Iraq, Libya and Korea. When Brian was unable to market PROMIS further, it is claimed that, with the help of Rafi Eitan, a high-ranking Israeli intelligence officer, the British publisher Robert Maxwell was recruited to assist.

In a sworn affidavit, the investigative author Gordon Thomas recounts how Eitan told him Maxwell alone sold over $500m worth of espionage-enabled versions of PROMIS – including licences to the UK, Australia, South Korea, Canada and the Soviet KGB. The British counter-intelligence agency MI5, according to Eitan (who himself was an adviser to the UK secret service MI6), used PROMIS to track members of the Irish Republican Army (IRA), as well as Irish republican political leaders including Gerry Adams.

Inslaw alleges the US government, by selling PROMIS to other governments around the world, engaged in what equates to "multibillion-dollar theft". This claim was supported by two separate courts in 1988, which ruled that it "took, converted, stole" PROMIS from Inslaw "through trickery, fraud and deceit". Three years later, however, a court of appeal overturned both rulings on a "jurisdictional technicality" after pressure from the federal justice department.

Now more than two decades since he pioneered PROMIS, the Inslaw president Bill Hamilton today believes the story illustrates an enduring, fundamental problem at the heart of the US justice system. "[It] chronicles the continued inability of the US government to enforce federal criminal laws in cases involving national security issues, or even to render ordinary civil justice," he says. "National security appears to suspend the checks and balances built into the system of government in the United States, to the detriment of the citizens."

Some, including the US government, have tried to dismiss the Inslaw saga as conspiracy. But a message relayed to Bill Hamilton and his wife from the former chief investigator of the Senate judiciary committee, Ronald LeGrand, seems to confirm that the strange PROMIS affair – which remains unresolved – is much more than just a case of chronic paranoia.

"What Mr and Mrs Hamilton think happened, did happen," LeGrand wrote, conveying information he had received from a trusted government source. "The Inslaw case is a lot dirtier for the Department of Justice than Watergate was, in both breadth and depth. The Department of Justice has been compromised in the Inslaw case at every level. "

Ryan Gallagher is a freelance journalist based in London, currently working for the Frontline Club. His website is here.

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Winning Scottish independence will be even harder than before - but it may be the only choice

Independence campaigners will have to find answers on borders, currency and more. 

The Brexit mutiny has taken not just the UK economy and its relationship with Europe into uncharted waters. it has also imperilled the union between Scotland and England. From Sir John Major to the First Minister, both Unionists and Nationalists had warned of it. The outcome, though, has made this certain. The Leave vote in England and Wales contrasted with an overwhelming Remain vote north of the border.

That every region in Scotland voted to stay In was quite remarkable. Historically, fishing and industrial communities have blamed the European Union for their woes. That antagonism was probably reflected in lower turnout - an abstention rather than a rejection. 

The talk now is of a second referendum on independence. This is understandable given the current mood. Opinion polls in the Sunday Times and Sunday Post showed a Yes vote now at 52 per cent and 59 per cent respectively. Moreover, anecdotal evidence suggests even arch No vote campaigners, from JK Rowling to the Daily Record, are considering the option.

The First Minister was therefore correct to say that a second referendum is now “back on the table”. Her core supporters expects no less. However, as with the economy and Europe, the constitutional relationship between Scotland and England is now in uncharted seas. Potential support for independence may be higher, but the challenges are arguably bigger than before. The difficulties are practical, political and geographic.

Of course the Little Englanders likely to take the helm may choose a velvet divorce. However, given their desire for the return of the Glories of Britannia that’s improbable. They’re as likely to wish to see Caledonia depart, as cede Gibraltar to Spain, even though that territory voted even more overwhelmingly In.

Ticking the legal boxes

Practically, there’s the obstacle of obtaining a legal and binding referendum. The past vote was based on the Edinburgh Agreement and legislation in Westminster and Holyrood. The First Minister has indicated the democratic arguments of the rights of the Scots. However, that’s unlikely to hold much sway. A right-wing centralist Spanish government has been willing to face down demands for autonomy in Catalonia. Would the newly-emboldened Great Britain be any different?

There are no doubt ways in which democratic public support can be sought. The Scottish Government may win backing in Holyrood from the Greens. However, consent for such action would need to be obtained from the Presiding Officer and the Lord Advocate, both of whom have a key role in legislation. These office holders have changed since the first referendum, where they were both more sympathetic and the legal basis clearer. 

Getting the EU on side

The political hurdles are, also, greater this time than before. Previously the arguments were over how and when Scotland could join the EU, although all accepted ultimately she could remain or become a member. This time the demand is that Scotland should remain and the rest of the UK can depart. But will that be possible? The political earthquake that erupted south of the Border has set tectonic plates shifting, not just in the British isles but across the European continent. The fear that a Brexit would empower dark forces in the EU may come to pass. Will the EU that the UK is about to leave be there for an independent Scotland to join? We cannot know, whatever European Commission President Jean-Claude Juncker may be saying at the moment. The First Minister is right to start engaging with Europe directly. But events such as elections in France and the Netherlands are outwith her control. 

Moreover, currency was the Achilles heel in the last referendum, and hasn’t yet been addressed. George Osborne was adamant in his rejection of a currency union. The options this time round, whether a separate Scottish currency or joining the euro, have yet to be properly explored. A worsened financial situation in the 27 remaining EU members hampers the latter and the former remains politically problematic. 

The problem of borders

Geography is also an obstacle  that will be even harder to address now than before. Scotland can change its constitution, but it cannot alter its location on a shared island. In 2014, the independence argument was simply about changing the political union. Other unions, whether monarchy or social, would remain untouched. The island would remain seamless, without border posts. An independent Scotland, whether in or out of the EU, would almost certainly have to face these issues. That is a significant change from before, and the effect on public opinion unknown.

The risk that's worth it

Ultimately, the bar for a Yes vote may be higher, but the Scots may still be prepared to jump it. As with Ireland in 1920, facing any risk may be better than remaining in the British realm. Boris Johnson as Prime Minister would certainly encourage that. 

David Cameron's lack of sensitivity after the independence referendum fuelled the Scottish National Party surge. But perhaps this time, the new Government will be magnanimous towards Scotland and move to federalism. The Nordic Union offers an example to be explored. Left-wing commentators have called for a progressive alliance to remove the Tories and offer a multi-option referendum on Scotland’s constitution. But that is dependent on SNP and Labour being prepared to work together, and win the debate in England and Wales.

So, Indy Ref The Sequel is on the table. It won’t be the same as the first, and it will be more challenging. But, if there is no plausible alternative, Scots may consider it the only option.

Kenny MacAskill served as a Scottish National MSP between 2007 and 2016, and as Cabinet Secretary for Justice between 2007 and 2014.