U.S. Scientist Arrested for Allegedly Attempting to Pass Secrets to Israel A former NASA Scientist is caught in a sting operation for alleged espionage.

Oct. 19, 2009 -- FBI agents arrested a scientist who worked for NASA and other agencies Monday afternoon in a sting operation after he allegedly attempted to sell top secret satellite information to agents he thought were Israeli spies.

Stewart Nozette, 52, was arrested shortly after 4:00 p.m. at the Mayflower Hotel in downtown Washington by counterespionage agents from the FBI's Washington field office after he believed he was meeting with agents from the Mossad to pass information to them in exchange for money, the Justice Department said.

Nozette had been under investigation for some time according to an FBI affidavit and court records involving his firm, the Alliance for Competitive Technology (ACT). In early January 2009 as he traveled overseas, a security check of his personal bags indicated he had two computer thumb drives in his possession; yet, when he returned on his trip, the drives were no longer in his possession, according to the government.

The investigation ramped up in September 2009 when he was approached by an undercover FBI agent who told Nozette he worked for Mossad. During a lunch meeting with the agent, Nozette indicated he was willing to work for Israeli intelligence and provide them information, court documents say.

"I haven't been…involved in a classified work for the last couple of years…but I had everything…all the way to Top Secret SCI [sensitive compartmentalized information], I had nuclear." Nozette told the undercover FBI agents, according to the affidavit. "I had all the nuclear clearances."

Nozette is best known for his work on the lunar Mini-RF probe which recently helped confirm the presence of water on the moon. Nozette is a planetary scientist from MIT who worked for the White House National Space Council and the Lawrence Livermore National Laboratory in the 1990s and as a contractor for the U.S. Naval Research Laboratory. At the Department of Energy, he worked in the "O" Division and had Top Secret clearance which included nuclear weapon design information, according to an FBI affidavit in the case which was unsealed Monday afternoon in Washington.

Nozette, who established his own company, ACT, had been under criminal investigation by NASA's Office of the Inspector General for submitting false billing records to NASA and the Defense Department as part of his government contracting work with ACT.

The FBI affidavit in the case also alleges that between November 1998 and January 2008, Nozette had worked as a consultant for an Israeli aerospace company.

"Approximately once a month, representatives of the aerospace company posed questions, or tasking, to Nozette. Nozette answered the aerospace company's questions and in return, Nozette received regular payments from the company totaling approximately $225,000."

According to the affidavit, the FBI undercover agent told Nozette the Mossad would like to use a dead drop location to pass information via a post office box in Washington. In a series of later meetings with undercover agents, Nozette discussed getting paid by the Israelis and made reference to the aerospace company, allegedly saying, "I thought I was working for you already. I mean that's what I always thought, [the foreign company] was just a front."

During one meeting, Nozette indicated he could be paid in cash up to $10,000. "Cash is fine…[I know] how to handle cash...you buy consumables…cash is good for anything…you can eat it, drink it or screw it."

On Sept. 10, 2009, FBI agents left a letter -- in the post office box Nozette had been told about -- for him to answer questions about U.S. satellite information. A week later, Nozette returned the letter to the post office box with answers to the questions, and passport pictures for an Israeli passport the scientist had requested and an encrypted computer thumb drive.

The FBI later determined that the information provided by Nozette was classified as Top Secret. On one document, Nozette also seemed to brag that he had access to programs beyond Top Secret, classified as special access programs [SAP]. "Held at least 20+ SAP…from 1998-2004...These are among the most sensitive subjects."

An attorney could not be reached for comment Monday evening. Nozette is expected to appear before a federal magistrate Tuesday afternoon.