Plot to Spy on Obama Officials Was Espionage for Dimwits

(Bloomberg Opinion) -- Are you a billionaire looking to dig up dirt on a rival? You could go with one of the private intelligence firms staffed by retired retreads from the CIA or Mi6. But why not hire the best? See what a little Mossad magic can do for you.

This is essentially the marketing pitch of Black Cube, a private Israeli intelligence firm staffed by former Mossad operatives. It “specializes in tailored solutions to complex business and litigation challenges,” according to its website.

They’ve been in the news recently. Harvey Weinstein hired them to find compromising information about some of the women accusing him of assault. A Canadian private equity firm hired them to surreptitiously record a former Ontario Superior Court judge in a sting operation. In May, the U.K. Observer first reported that people connected to President Donald Trump’s inner circle had hired Black Cube to spy on former White House officials who worked for Barack Obama. 

The latest chapter in the saga comes from the Israeli newspaper Haaretz. It reports that Black Cube spied on Obama officials on behalf of Taiwanese shipping magnate Nobu Su. The firm wanted to find hidden Iranian assets that could be seized in litigation on behalf of the victims of terrorism. There is usually a tidy fee and percentage in identifying such assets in these cases. And Black Cube’s operatives believed former senior White House officials like Ben Rhodes and Colin Kahl might know where Tehran’s money was stashed.

This week I received a cache of Black Cube documents and interviewed people familiar with the project. They confirm that the mission to spy on 20 former Obama administration officials was part of this larger hunt for hidden Iranian wealth. One such document outlines the project under the heading “Iranian Judgments Enforcement.” It says the project sought to collect intelligence “linking former U.S. government officials and institutions” to an effort to conceal Iran’s assets in the West. It also sought to learn whether Iran paid off officials like Rhodes, the former deputy national security adviser.

The phase of the operation targeting the Obama officials lasted about three months in 2017, according to one former Israeli intelligence officer familiar with the Black Cube project. The idea was to send operatives to pose as students, business executives or academics, and then surreptitiously record the targets discussing hidden Iranian assets or their financial relationship to Iran. If Black Cube could prove that the Obama White House skirted U.S. sanction laws, then future clients could in turn sue the U.S. government, using the secret recordings as evidence.

If this indeed was the plan, it was moronic. To start, most of the former officials like Rhodes, Kahl or Caroline Tess (who served as senior director for legislative affairs on Obama’s national security council) lack the expertise or access to intelligence on hidden Iranian assets. All three worked closely on trying to sell the Iran nuclear deal to Congress and the news media. But deciphering Iran’s illicit finances is what analysts at the Central Intelligence Agency or Treasury Department do, not senior White House officials.

Kahl, who was national security adviser to Vice President Joe Biden at the time, told me this explanation does not pass the laugh test. “We were not the key decision makers on any of these things, we were not in the weeds on any of the financial details of the agreement, none of us have overseas interests,” he said.

A pro-Israel American political consultant who was approached by Black Cube in 2017 about the project told me that his contact did not mention tracking illicit Iranian finances and stressed the theory that former Obama officials were being paid indirectly by Iran. “It was so stupid and ham-handed,” he said. “These guys don’t need to be paid to support the Iran deal. They devoted their careers to it.”

This gets to a second problem. Black Cube was playing with fire. All spies must prepare for the contingency that an operation is exposed. Spying on former Obama officials risks blowback for the Jewish state. Israel to this day is distrusted by many in the U.S. intelligence community for recruiting Navy intelligence analyst Jonathan Pollard in the 1980s. Even though Black Cube is a private company, it’s closely linked to Israel’s intelligence establishment. The late Mossad chief Meir Dagan was the president of its corporate board. There is a good chance Rhodes, Kahl and Tess will serve in future Democratic administrations. Does Black Cube think they will forget this episode when they are back in power?

Finally, the tradecraft was pathetic. The operatives who tried to entice the Obama officials used elements of the same cover story on the Harvey Weinstein account. This detail was first reported by Ronan Farrow of the New Yorker, who noticed that one of the women who approached Kahl’s wife claimed to work for Reuben Capital Partners. What do you know? One of the women who approached Rose McGowan, an actress who has accused Weinstein of assault, also claimed to work for Reuben Capital Partners. The former Israeli intelligence operative told me this mistake — using the same cover story for two different projects — was why the spying on the Obama officials was exposed.

For its part, Black Cube says its policy is “never to confirm or deny speculation about its work. Black Cube only works to gather evidence for major litigation, and not for other purposes. We act in accordance with the law and with counsel from leading law firms around the world.”

In the end, Black Cube’s risky play was a bust. Israelis familiar with the project say no leads on Iranian assets or anything else of value was gleaned by the efforts to spy on former Obama officials. The only thing this private intelligence agency exposed was itself.

To contact the editor responsible for this story: Stacey Shick at sshick@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Eli Lake is a Bloomberg Opinion columnist covering national security and foreign policy. He was the senior national security correspondent for the Daily Beast and covered national security and intelligence for the Washington Times, the New York Sun and UPI.

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