AQ KHAN TRIAL: DANIEL GEIGES PLEADS GUILTY

C O N F I D E N T I A L SECTION 01 OF 06 PRETORIA 000234 SIPDIS SIPDIS DEPT FOR P, T, ISN/CPI, AF/S E.O. 12958: DECL: 02/04/2018 TAGS: PARM MNUC PREL KNNP SF SUBJECT: AQ KHAN TRIAL: DANIEL GEIGES PLEADS GUILTY REF: A. 07 PRETORIA 3210 AND PREVIOUS ¶B. KAY/WILLS EMAIL OF 02-05-2008 Classified By: Deputy Chief of Mission Don Teitelbaum. Reasons 1.4(b) and (d). ¶1. (C) SUMMARY and INTRODUCTION: Swiss citizen Daniel Geiges was convicted in the Pretoria High Court of unlawful manufacture of components for illicit gas centrifuge uranium enrichment plants intended for Libya and Pakistan and for associated export control violations on 05 February. This message details the terms and requirements of Geiges' plea bargain agreement. The complete plea package and all annexes have been scanned and emailed to AF/S and to ISN/CPI (Ref B). Since Geiges is terminally ill with cancer, his 13-year prison sentence has been wholly suspended on the condition that he provide a full accounting of his activities and cooperate in related investigations and prosecutions. However, he will forfeit all proceeds of his crimes. South Africa's conviction of Geiges and co-conspirator Gerhard Wisser (Ref A) remain the only successful prosecutions of major A.Q. Khan proliferation network figures to date. USG assistance, in the form of affidavits from several technical experts, contributed significantly to establishing the facts and gravity of Wisser's and Geiges' crimes. Geiges did not appear well at today's court session. Mission strongly recommends that any government desiring Geiges' testimony in a related prosecution immediately contact the SAG to begin making the necessary arrangements. END SUMMARY and INTRODUCTION. -------------- The Conviction -------------- ¶2. (SBU) Geiges and Wisser, as well as their company, Krisch Engineering, jointly were indicted on ten counts of contravening the Nuclear Energy Act, of contravening the Non-Proliferation of Weapons of Mass Destruction Act and of fraud. On 05 September 2007, Wisser pled guilty to seven of the original ten indictment counts. He maintained his not guilty plea on three others. The prosecution declined to prosecute two of these three, on the grounds that they were redundant and that Wisser had already admitted his guilt in relation to other indictment counts. On the third, the prosecution accepted Wisser's argument that a witness statement established the illegal action in question had been committed by someone other than Wisser. ¶3. (SBU) Geiges' case was severed from that of Wisser following Wisser's guilty plea, and Geiges subsequently was re-indicted on eight of the original ten counts. (The other two counts related to specific acts of forgery committed solely by Wisser.) On 05 February, Geiges pled guilty to Counts 1, 2, 4, 7, and 8 of this indictment. His admissions of guilt follow below: COUNT ONE: Import, transit holding, and export of a Denn Model RL 400/2 flow-forming machine, serial number 6319/6318 without a permit issued by the South African Council for the Qwithout a permit issued by the South African Council for the Non-Proliferation of Weapons of Mass Destruction during the period November 2000 to December 2001. Geiges pled guilty, admitting: -- he illegally caused the Denn flow-forming machine to be imported into South Africa during the times and at the places detailed in the indictment; -- the flow-forming machine is defined as a controlled item; -- the content of the affidavit submitted by retired Oak Ridge National Laboratory Consultant Ron Miskell detailing the technical specs of the flow-former which made it a controllable item is truthful; -- the acts related to import of the flow-former required a permit from the South African Council for the PRETORIA 00000234 002 OF 006 Non-Proliferation of Weapons of Mass Destruction; -- he knew he was acting unlawfully when he associated himself with all acts related to the flow-former's import, transit and export; and, -- the factual circumstances surrounding Count One are correctly set out in para 8 of the plea agreement. COUNT TWO: Unlawful and intentional manufacture or production of feed systems, product and tails withdrawal systems, and machine header piping systems for gas centrifuge uranium enrichment plants without written authorization from the Minister of Minerals and Energy during the period 24 February 2000 to 01 September 2004. Geiges pled guilty, admitting: -- he unlawfully and intentionally caused the referenced nuclear related material or equipment to be manufactured during the period described; -- the systems are correctly described in Count Two; -- the equipment falls within the relevant legal definitions and the contents of the affidavit submitted by USDoE Deputy Administrator William H. Tobey are true; -- he was required to obtain written authorization from the Minister of Minerals and Energy prior to manufacturing these systems and he did not do so; -- he knew he was acting unlawfully when he manufactured these systems; and, -- the factual circumstances surrounding Count Two are correctly set out in para 7 of the plea agreement. COUNT FOUR: Unlawful and intentional attempt to export nuclear related equipment or material (i.e. the systems outlined in Count Two) without written authorization from the Minister of Minerals and Energy during the period 2001 to 01 September 2004. Geiges pled guilty, admitting: -- he was fully aware at all times during his participation in the manufacture of the systems described in Count Two that these systems would be exported once manufactured; -- during the period described, he unlawfully and intentionally associated himself with his co-conspirators' attempts to export these systems from South Africa; -- he was aware that his co-conspirators were required to obtain written authorization from the Minister of Minerals and Energy prior to arranging for export of these systems; since they did not do so he associated himself with their unlawful actions; and, -- the factual circumstances surrounding Count Four are correctly set out in para 7 of the plea agreement. COUNT SEVEN: Unlawful and intentional manufacture or production of three autoclaves and accessories for gas centrifuge uranium enrichment plants without written authorization from the Minister of Minerals and Energy during the period 15 July 1994 to 10 January 1995. Geiges pled guilty, admitting: -- he unlawfully and intentionally caused the manufacture of the referenced autoclaves during the period described; -- the equipment is correctly described in Count Seven; -- the equipment falls within the relevant legal definitions Q-- the equipment falls within the relevant legal definitions and the contents of the affidavit submitted by Deputy Administrator Tobey are true; -- at the time of manufacture, he was not a member of the Atomic Energy Corporation and thus required written authorization from the Minister of Minerals and Energy before performing these acts; -- he did not have this written authorization and thus was acting unlawfully; and, -- the factual circumstances surrounding Count Seven are PRETORIA 00000234 003 OF 006 correctly set out in para 6 of the plea agreement. COUNT EIGHT: Unlawful and intentional export of nuclear related equipment or material (i.e. the autoclaves outlined in Count Seven) from South Africa to Dubai, UAE without written authorization from the Minister of Minerals and Energy during the period January 1995. Geiges pled guilty, admitting: -- he associated himself with the unlawful actions of his co-conspirators in exporting the referenced autoclaves from South Africa to the UAE; -- the equipment is correctly described in Count Seven; -- the equipment falls within the relevant legal definitions and the contents of the affidavit submitted by Deputy Administrator Tobey are true; -- at the time of export, he was not a member of the Atomic Energy Corporation and thus required written authorization from the Minister of Minerals and Energy before performing these acts; -- he did not have this written authorization and thus was acting unlawfully; and, -- the factual circumstances surrounding Count Seven are correctly set out in para 6 of the plea agreement. ¶4. (SBU) Counts 3, 5, and 6 were withdrawn by the prosecution. Geiges' illness previously had prevented him from appearing in court to enter a not guilty plea on any of the eight indictment counts. Therefore, the question of Geiges' culpability on those three counts was not specifically addressed by the prosecution. This differs from the case of Wisser, where Wisser had already submitted "not guilty" pleas on the counts not addressed in his plea package and the prosecution therefore was required to address the pleas on record. Based on court records of the Wisser plea bargain, we offer the following estimates of the prosecution's likely views on Geiges' involvement in those crimes: COUNT THREE: Unlawful and intentional conspiracy with Johan Andries Muller Meyer, Buhary Seyed Abu Tahir, Gotthard Lerch, Abdul Qadeer Khan, and others in commission of the offense outlined in Count Two during the period 1999 to 23 February ¶2000. Wisser maintained his not guilty plea on this count, but his plea statement explicitly referred the court to the portions of the plea agreement where he had admitted elements of this offense. During Wisser's court appearance, NPA lead prosecutor R.C. Macadam specifically stated that the prosecution continues to maintain the guilt of the accused, but had declined to pursue the charge since Wisser had already admitted to the facts of his illegal activities in the commission of the Count Two offenses. We assume the prosecution's withdrawal of this charge in the Geiges case was based on a similar logic. COUNT FIVE: Unlawful and intentional attempt to dispose of technology relating to nuclear related equipment or material (i.e. the systems outlined in Count Two) without written authorization from the Minister of Minerals and Energy during Qauthorization from the Minister of Minerals and Energy during the period 24 February 2000 to 01 September 2004. Here again, Wisser maintained his not guilty plea, but his plea statement explicitly referred the court to the portions of the plea agreement where he admitted elements of the offense. During Wisser's court appearance, Macadam specifically stated that the prosecution continues to maintain the guilt of the accused, but had declined to pursue the charge since Wisser had already admitted to the facts of his illegal activities in the commission of the Count Four PRETORIA 00000234 004 OF 006 offenses. We assume the prosecution's withdrawal of this charge in the Geiges case was based on a similar logic. COUNT SIX: Fraud via the provision to shipping company Rohlig Grindrod of documentation misrepresenting the Denn flow-former referred to in Count One as a lathe and misrepresenting its monetary value at USD 23,500 (actual value was approximately USD 300,000) with the intent of evading import permit and tax obligations. Wisser maintained his not guilty plea, referring the Court to para 20 of the affidavit submitted by Tahir in which Tahir states that Peter Griffin and Gotthard Lerch arranged the creation of the fraudulent documents in question. During the court session, Macadam acknowledged that based on the evidence from Tahir the prosecution had declined to pursue this charge. A similar Tahir affidavit excerpt was submitted as Tab 3 of the Geiges plea package. Therefore, we assume that the prosecution continues to believe that Griffin and Lerch bear responsibility for this crime. -------------- Sentencing Terms -------------- ¶5. (SBU) The prosecution described the following mitigating factors considered in determining an appropriate sentence for Geiges: -- Geiges' age (69) and the fact that he is terminally ill with cancer and "has an extremely short life expectancy"; -- Geiges' lack of prior convictions (with the caveat that his lack of a criminal record is only due to the fact that the crimes detailed in Counts 7-8 had not been detected previously); -- Geiges' decision to plead guilty to all the main charges rather than using his medical condition as an excuse to evade prosecution; -- Geiges (aside from the crimes to which he has admitted) has been "a senior, responsible and respectable member of society"; -- Geiges has agreed to cooperate fully by providing South African authorities with a full disclosure of his total knowledge of nuclear proliferation related activities, in accordance with applicable law and policies; -- Geiges has consented to confiscation of criminal proceeds held by a foreign government, which will allow a portion thereof to be shared with the SAG; -- after his September 2004 arrest, Geiges was in custody for three months and has been under house arrest since; -- Geiges was acting as an employee of Wisser and did not profit from his role in the commission of these crimes other than the fees paid to him by co-conspirator JAM Meyer. He has been without employment since shortly after his arrest and has suffered financial hardship. ¶6. (SBU) The following aggravating circumstances were highlighted: -- The unique destructive power of nuclear weapons and the efforts of countries of concern to obtain such weapons despite international efforts to prevent proliferation and offensive deployment of nuclear weapons, through the use of Qoffensive deployment of nuclear weapons, through the use of illicit networks (supported by the affidavit of Los Alamos National Laboratory expert Jeff Bedell); -- the fact that Geiges' crimes all were related to the proliferation of gas centrifuge uranium enrichment plants, the preferred method of enrichment for states establishing/maintaining illicit nuclear weapons programs; -- Geiges' crimes contributed to Libya's attempt to acquire nuclear weapons and assisted countries like Pakistan to maintain existing weapons programs and were committed during PRETORIA 00000234 005 OF 006 a period when "high levels of conflict existed in both the Middle East and Asia"; -- Geiges' crimes would have gone undetected if not for the interdiction of the BBC China and Libya's subsequent decision to come clean; -- Geiges' crimes undermined South Africa's reputation, policy, and international obligations vis a vis nonproliferation; -- Geiges persisted in his activities even after they had been formally criminalized by the post-apartheid regime; -- Geiges' activities became progressively more serious and he was "a mature citizen" at the time he committed these offenses. An additional 11 aggravating circumstances specific to the various charges also were detailed. These focused on the sophistication of the criminal activities, Geiges' technical knowledge of the systems involved, and breaches of international control regimes. ¶7. (SBU) Pretoria High Court judge van der Merwe accepted all mitigating factors and aggravating circumstances. Showing exceptional care for Geiges' medical condition, he asked Geiges to confirm his understanding of each of the charges and his plea of guilty to Counts 1, 2, 4, 7, and 8. Van der Merwe then sentenced Geiges as follows (per the terms of the plea agreement): For Counts 1, 2 and 4: Ten years' imprisonment suspended for a period of five years, on condition that: -- Geiges is not convicted and sentenced for similar crimes (contravening the Nuclear Energy Act, the Weapons of Mass Destruction Act, or any equivalent laws which replace them); -- Geiges provides the South African Police Service (SAPS) with affidavits detailing the full extent of his knowledge of all matters relevant to nuclear proliferation as identified by SAPS; -- Geiges testifies in all proceedings and complies with all processes relating to him (domestic and foreign); -- Geiges provides his full cooperation to the South African Council for the Non-Proliferation of Weapons of Mass Destruction and with the IAEA on nuclear proliferation matters; and, -- Geiges inform a member of the Non-Proliferation Council of any inquiries he may receive which have nuclear or other proliferation implications and comply with any instructions given to him by the Council in connection with such inquiries. (NOTE: The plea agreement provides that the Council must notify Geiges of the contact details of an appropriate official within five days of conviction and sentencing. DepPolCouns saw Daan van Beek, Department of Trade and Industry working level representative on the Council, provide Geiges his business card as Geiges was being fingerprinted after sentencing. However, Mission does not know whether van Beek has formally been designated as Geiges' Point of Contact at the Council. END NOTE) For Counts 7 and 8: Three years' imprisonment suspended for a period of five years, on condition that Wisser is not convicted and Qyears, on condition that Wisser is not convicted and sentenced for similar crimes (contravening the Nuclear Energy Act, the Weapons of Mass Destruction Act, or any equivalent laws which replace them). For all Counts: -- Confiscation of Euro 50,000 and CFH 74,255 in cash plus any interest which may have accrued thereto, currently frozen by Swiss authorities. PRETORIA 00000234 006 OF 006 -------------- Comment -------------- ¶8. (C) Contrary to his vibrant physical presence at the Wisser plea bargain (Ref A),Geiges appeared weak, gaunt, and mostly silent in court today. He declined all media requests for interviews -- a departure from his past practice. Geiges' visible ill health underscored the plea package assessment that he has little time left before succumbing to cancer. Any other government wishing to make use of Geiges' testimony in a related A. Q. Khan network prosecution should act quickly to secure that testimony. ¶9. (SBU) The following foreign individuals and companies were named in the Geiges and Wisser plea agreements as having been involved in the A. Q. Khan network's illicit nuclear proliferation activities: Sri Lankan citizen B.S.A. Tahir; German citizen Gotthard Lerch; Swiss citizens Fred, Urs, and Marco Tinner; UK citizen Peter Griffin; German company Leybold Heraeus GmbH; Swiss company AVE Apparate Verfahren und Engineering AG; UAE company BB Enterprises of Dubai; UAE company Al Hadwa General Trading of Dubai; Pakistani company Arshad, Amjad and Abid, Ltd. of Karachi; UAE company Gulf Technical Industries of Dubai; and, the unnamed Spanish company which shipped the Denn flow-former to GTI in Dubai. It is not clear from the content of Geiges' plea agreement whether he ever had personal contact with A.Q. Khan or whether such contacts were channeled through Wisser, Tahir, and Lerch. BOST