@StateDept OMS Arrested/Charged With Concealing Extensive Contacts With Chinese Intel Agents

Posted: 5:17 pm ET
Updated: March 30, 4:18 am ET  
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On March 29, the Justice Department announced the arrest of State Department employee, Candace Marie Claiborne, 60, of Washington, D.C. for obstructing an official proceeding and making false statements to the FBI, both felony offenses, and for allegedly concealing numerous contacts that she had over a period of years with foreign intelligence agents.  The State Department phone directory dated March 27, 2017 lists Candace Claiborne as an Office Management Specialist (OMS) at the Office of Caucasus Affairs and Regional Conflicts (EUR/CARC). This office has desk officers for Armenia, Georgia, and Azerbaijan, as well as the Minsk Group Co-Chair.  The Minsk Group  provide a forum for negotiations towards a peaceful settlement in the Nagorno-Karabakh conflict involving Armenia and Azerbaijan.

The DOJ announcement notes that Claiborne has been an Office Management Specialist (OMS) for the Department of State in since 1999 and has served overseas at a number of posts, including embassies and consulates in Baghdad, Iraq, Khartoum, Sudan, and Beijing and Shanghai, China.  Given the lengths of the tours of duty, we suspect that she was in more than four posts in 18 years, but we have yet to see a copy of the FBI complaint. OMSs provide office management and administrative support including managing the calendar(s) and schedule(s) for senior staff, proofing, editing, tracking and filing documents, preparing agenda and materials for meetings, providing computer and mobile device support, knowledge management, and planning and assisting with official events and visitors. Read more about OMSs here.

According to the FBI agent’s affidavit supporting the criminal complaint and arrest warrant, “there is probable cause to believe that Claiborne made materially false statements to federal law enforcement officers, in violation of 18 U.S.C. 1001, and conspired with Co-Conspirators A B, and C to obstruct an official proceeding, in violation of 18 U.S.C. 1512. These criminal violations werc either begun or committed in Washington D.C., where Claiborne resides and works, and where the Department of State is headquartered or were begun or committed overseas, out of the jurisdiction of any particular state.”  But who’s Co-Conspirator A, and why wasn’t he charged?

Read the criminal complaint here via Politico. It looks pretty bad. 

Below is the DOJ announcement:

State Department Employee Arrested and Charged With Concealing Extensive Contacts With Foreign Agents

A federal complaint was unsealed today charging Candace Marie Claiborne, 60, of Washington, D.C., and an employee of the U.S. Department of State, with obstructing an official proceeding and making false statements to the FBI, both felony offenses, for allegedly concealing numerous contacts that she had over a period of years with foreign intelligence agents.

The charges were announced by Acting Assistant Attorney General Mary B. McCord for National Security, U.S. Attorney Channing D. Phillips of the District of Columbia and Assistant Director in Charge Andrew W. Vale of the FBI’s Washington Field Office.

“Candace Marie Claiborne is a U.S. State Department employee who possesses a Top Secret security clearance and allegedly failed to report her contacts with Chinese foreign intelligence agents who provided her with thousands of dollars of gifts and benefits,” said Acting Assistant Attorney General McCord. “Claiborne used her position and her access to sensitive diplomatic data for personal profit. Pursuing those who imperil our national security for personal gain will remain a key priority of the National Security Division.”

“Candace Claiborne is charged with obstructing an official proceeding and making false statements in connection with her alleged concealment and failure to report her improper connections to foreign contacts along with the tens of thousands of dollars in gifts and benefits they provided,” said U.S. Attorney Phillips. “As a State Department employee with a Top Secret clearance, she received training and briefing about the need for caution and transparency. This case demonstrates that U.S. government employees will be held accountable for failing to honor the trust placed in them when they take on such sensitive assignments”

“Candace Claiborne is accused of violating her oath of office as a State Department employee, who was entrusted with Top Secret information when she purposefully mislead federal investigators about her significant and repeated interactions with foreign contacts,” said Assistant Director in Charge Vale. “The FBI will continue to investigate individuals who, though required by law, fail to report foreign contacts, which is a key indicator of potential insider threats posed by those in positions of public trust.”

The FBI arrested Claiborne on March 28. She made her first appearance this afternoon in the U.S. District Court for the District of Columbia.

According to the affidavit in support of the complaint and arrest warrant, which was unsealed today, Claiborne began working as an Office Management Specialist for the Department of State in 1999. She has served overseas at a number of posts, including embassies and consulates in Baghdad, Iraq, Khartoum, Sudan, and Beijing and Shanghai, China. As a condition of her employment, Claiborne maintains a Top Secret security clearance. Claiborne also is required to report any contacts with persons suspected of affiliation with a foreign intelligence agency.

Despite such a requirement, the affidavit alleges, Claiborne failed to report repeated contacts with two intelligence agents of the People’s Republic of China (PRC), even though these agents provided tens of thousands of dollars in gifts and benefits to Claiborne and her family over five years. According to the affidavit, the gifts and benefits included cash wired to Claiborne’s USAA account, an Apple iPhone and laptop computer, Chinese New Year’s gifts, meals, international travel and vacations, tuition at a Chinese fashion school, a fully furnished apartment, and a monthly stipend. Some of these gifts and benefits were provided directly to Claiborne, the affidavit alleges, while others were provided through a co-conspirator.

According to the affidavit, Claiborne noted in her journal that she could “Generate 20k in 1 year” working with one of the PRC agents, who, shortly after wiring $2,480 to Claiborne, tasked her with providing internal U.S. Government analyses on a U.S.-Sino Strategic Economic Dialogue that had just concluded.

Claiborne, who allegedly confided to a co-conspirator that the PRC agents were “spies,” willfully misled State Department background investigators and FBI investigators about her contacts with those agents, the affidavit states. After the State Department and FBI investigators contacted her, Claiborne also instructed her co-conspirators to delete evidence connecting her to the PRC agents, the affidavit alleges.

Charges contained in a criminal complaint are merely allegations, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.

The maximum penalty for a person convicted of obstructing an official proceeding is 20 years in prison. The maximum penalty for making false statements to the FBI is five years in prison. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes. If convicted of any offense, the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.

At her court appearance today, Claiborne pleaded not guilty before the Honorable Magistrate Judge Robin M. Meriweather. A preliminary hearing was set for April 18.

The FBI’s Washington Field Office is leading the investigation into this matter. The case is being prosecuted by Assistant U.S. Attorneys John L. Hill and Thomas A. Gillice for the District of Columbia and Trial Attorney Julie Edelstein of the National Security Division’s Counterintelligence and Export Control Section.

It looks like the arrest warrant was issued yesterday, and the complaint was unsealed today, but we have yet to locate the charging document.  As with the DOJ statement, we should note that charges contained in a criminal complaint are allegations, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.

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Trump Seeks Further Funding Cuts From @StateDept/@USAID, This Time From 2017 Budget

Posted: 2:51 am ET
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Last December, Public Law No: 114-254 (12/10/2016) was signed into law to provide continuing appropriations for most federal agencies through April 28, 2017. This continuing resolution (CR) was passed and it prevented a shutdown of the federal government that would have occurred when the previous CR expired on December 9, 2016 (at that time, eleven of the twelve FY2017 regular appropriations bills that fund the federal government had not been enacted).  The bill funded most projects and activities at the rate established for FY2017 spending by the Budget Control Act of 2011 including additional emergency, disaster relief, and Overseas Contingency Operations (OCO) funding.

It looks like the House will be in session for eight calendar days in April, while the Senate will have ten days. With six months left in the current fiscal year and while Congress is expected to wrestle once more with that CR next month, the Trump Administration is also seeking cuts from the FY2017 budget.  The “savings” from the proposed cuts in the current fiscal year will reportedly also go to DOD for additional military spending, and to help build that wall.

Via usnews.com:

memo sent by the administration on Friday to the House and Senate appropriations committees provides the first detailed look at the proposed cuts, and is expected to meet resistance as the budget blueprint did from lawmakers who have fewer than a dozen legislative days to craft and pass the trillion-dollar spending legislation to keep the lights on.
[…]
All told, the programs overseen by the Labor, Health and Human Services and Education subcommittee would see the greatest reductions, totalling $7.26 billion, followed by $2.88 billion from the subcommittee for State and Foreign Operations, including $1.16 billion to USAID foreign aid programs going to combating climate change, family planning and other global health initiatives.

The list of proposed reductions below is via Politico (see pages 11-12 above for the proposed cuts for the State Department).

Some programs will be slashed while others are zeroed out under the proposed cuts from the State/USAID budget for FY2017. In the case of PEPFAR (Aids) the proposal calls for “slowing the rate of new patients on treatment in FY17.” It slashed funds for peacekeeping operations, family planning/reproductive health, and refugee programs “because of lower projections in FY 2017 of refugee admissions.” Here are some of the most notable programs targeted for cuts this year under Trump’s proposal:

Development Assistance (DA) (-$562M): Proposed savings in the DA account include reducing support for bilateral climate change programs that are part of the previous Administration’s Global Climate Change Initiative. Further savings from the FY 2017 CR level can be achieved by reducing economic assistance in other sectors to programmatically sufficient levels, such as through reductions of up to 20 percent in basic and higher education (which has a large pipelines of unspent funds); biodiversity; democracy, human rights, and governance; agriculture and food security (while still addressing key objectives and priorities in the Global Food Security Act); and other sectors.

Economic Support Fund (ESF) (base) (-$290M): This decrease accepts the topline reduction in the House bill (-$274 million vs. CR), which included zeroing out the GCF. It then also reduces several sectors, including bilateral climate change, basic/higher education, democracy/governance, and economic growth.

President’s Emergency Plan for AIDS Relief (PEPFAR)/Global Health Programs (-$242M): This reduction would achieve savings by requiring PEPFAR to begin slowing the rate of new patients on treatment in FY 17, by reducing support to low-performing countries, by reducing lower-priority prevention programs, or by identifying new efficiencies or other savings.

International Narcotics Control and Law Enforcement (-$200M): This account can absorb a $200 million reduction from the annualized base CR rate with insignificant impact to the account, given carryover, the slow rate of FY 2016 obligations, and resources recaptured through de-obligations, recoveries, and proceeds of sale.

Foreign Military Financing (-$200M): This account can absorb a $200 million reduction from the annualized base CR rate by cutting funding for high income countries and consistent with funding restrictions for certain countries in the FY 2017 House and Senate bills.

International Organizations and Programs (-$169M): This account provides for non-assessed contributions to international organizations. This reduction would eliminate such contributions to most organizations funded through the account including the UN Population Fund and some contributions to climate change programs but preserve flexibility to make contributions to some organizations such as UNICEF as well as those supporting global security functions.

Educational and Cultural Exchanges (-$140M): Reduction or elimination of programs based on the ability to fund outside of ECE, ability to merge with other programs, and legacy programs in high income countries. Scale back of programs to prior year levels and/or 5-10% reductions given budgetary constraints.

Global Health Security (-$72M): This proposal zeroes out global health security programs at USAID in FY 2017 to realize up to $72.5 million in savings. These programs are currently supported with 2-year funds and it is unlikely the agency will obligate a significant portion of these funds under the current CR. This proposal instead seeks legislative authority to repurpose $72.5 million in remaining Ebola emergency funds to support these programs in FY 2017.

Specified Other Global Health Programs at USAID (-$90M):To achieve additional savings, reduced levels for:
• Tuberculosis (-$44.6 million below FY 17 CR)
• Polio eradication (-$7.9 million)
• Nutrition (-$16.3 million)
• Vulnerable children (-$7.5 million)
• Neglected tropical diseases (-$13.3 million)

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