BULLETIN: Stewart David Nozette, the Maryland man with a PhD from the Massachusetts Institute of Technology and a “Top Secret” security clearance, has been sentenced to 13 years in federal prison on charges of tax fraud and attempted espionage.
The espionage case was brought by the FBI after Nozette — believing he’d been recruited by Israel’s Mossad to spy on the United States — accepted $10,000 left by the FBI in an undercover sting. In effect, Nozette sold out his country for the price of a used car and the expectation that more cash would be forthcoming.
Nozette already was under investigation for tax evasion and financial fraud against the United States when he was arrested in the 2009 sting.
“Stewart Nozette’s greed exceeded his loyalty to our country” said U.S. Attorney Ronald C. Machen Jr. of the District of Columbia. “He wasted his talent and ruined his reputation by agreeing to sell national secrets to someone he believed was a foreign agent. His time in prison will provide him ample opportunity to reflect on his decision to betray the United States.”
The case was notable for reasons other than Nozette’s bid to sell out his country. Indeed, elements of the case were prosecuted by Machen’s office — an office familiar to readers of the PP Blog because it brought the AdSurfDaily Ponzi scheme case (under then-U.S. Attorney Jeffrey A. Taylor) in 2008 and supervised the return in 2011 and 2012 of more than $59 million (under Machen) to defrauded ASD investors.
Michael K. Atkinson, the assistant U.S. Attorney who led the Nozette tax and fraud prosecutions, once was assigned to the ASD case.
Nozette “betrayed his country and the trust that was placed in him by attempting to sell some of America’s most closely-guarded secrets for profit,” said Assistant Attorney General Lisa Monaco.
Monaco is from the Justice Department’s National Security division. She joined Machen in making the announcement about Nozette’s sentence, along with Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division.
Also joining in the the announcement were James W. McJunkin, assistant director in charge of the FBI’s Washington Field Office; Paul K. Martin, inspector general for the National Aeronautics and Space Administration (NASA OIG); Eric Hylton, acting special agent in charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI); and John Wagner, special agent in charge of the Washington, D.C., Office of the Naval Criminal Investigative Service (NCIS).
“Federal agents take an oath to protect our nation ‘against all enemies, foreign and domestic,” said Wagner. “That would include ‘insider threats’ like Stewart Nozette.”
Nozette, 54, parlayed his impressive academic credentials and MIT doctorate in planetary science into a career in which he conducted business with the U.S. government. He worked at the White House, for example, on the National Space Council through the Executive Office of the President of the United States.
Prosecutors said he also worked as a physicist for the U.S. Department of Energy’s Lawrence Livermore National Laboratory, and also had access to the U.S. Naval Research Laboratory (NRL) in Washington, D.C., the Defense Advanced Research Projects Agency (DARPA) in Arlington, Va., and NASA’s Goddard Space Flight Center in Greenbelt, Md.
“We are particularly proud that NASA OIG’s fraud investigation of Nozette, which began in 2006, served as the catalyst for further investigation and today’s outcome,” said Martin, NASA’s inspector general.
The indictment did not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. laws in this case, prosecutors said.
