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Seizure in Luxembourg
For French businessman Aimé Richardt, it was the type ofexperience he could have done without.
It all began simply enough. On May 9, 1985, as he had done manytimes in the past, he signed over five crates of high-tech gear to afreight forwarder near his home in Vesoul, France. The shipment wasslated to reach Moscow via Basel and Paris. To ensure all went well,Richardt handled the local Customs authorities himself. The cratescontained parts of an ion engraver - a rather outdated piece ofequipment, he explained - that was part of a big order he had beenshipping to Moscow over the past eighteen months. In this sleepyFrench town, close to the German border, no one blinked an eye. TheCustoms officer in charge examined the documents Richardt presented,checked that the invoice corresponded to the tarif code, and affixedhis stamp: "Export approved." With everything in order, Richardt'sfreight forwarder hauled the crates to the Basel airport, on theFrench border, and turned them over to Air France for the final legof the long journey to Moscow.
But four days later, things began to go wrong. Because ofunderbooking, on May 14, 1985 Air France cancelled its cargo flightSU 730 from Paris to Moscow. To satisfy their customer, theytransferred Richardt's cargo by truck to Luxembourg's Findel Airportto meet up with the regular Havana-Luxembourg-Moscow flight of theSoviet national carrier, Aeroflot. And that was when lightningstruck.
Was it the shipment of enriched uranium they had intercepted theyear before that had rendered the Luxembourg Customs agents workingunder Inspector Beck so suspicious? So at least the local press wouldspeculate in the weeks to come. When the case came to court, Richardtwould complain of a "breach of sovereignty" by the United StatesGovernment, implying that his shipment had been seized upon directorder from the U.S. Customs Service. Whatever the reason, theattention of the Luxembourg Customs was attracted by the name of theaddressee marked on the crates: V/O Technopromimport, Moscow, USSR.And when they saw that the sender's address in France was a mere PostOffice box, they decided to have a closer look.
As luck would have it, either Richardt's freight forwarder or AirFrance had made a mistake in the paperwork. On the Airway bill theyhad indicated that the equipment was of European origin. But on theCustoms documents, it was clearly marked that the crates contained anAmerican-built machine. Inspector Beck knew that the Grand Duchy'slone export-licensing official, Oscar Schmidt, was particularlyattentive when it came to re-exporting American technology. Specialauthorizations were required, and this shipment had no licensewhatsoever... On May 21, the Luxembourg Customs informed RenéThil, the local agent of Air France, that they had impounded the fivecrates belonging to a Dr. Aimé Richardt. As an additionalprecaution, they decided to inform the Paris office of the U.S.Customs Service of the seizure.
According to American law, the Customs Service is the soleenforcement agency allowed to "police" export control violationsabroad. And Customs takes its role so seriously it claims"extraterritoriality" in its quest to prevent critical Americantechnologies from reaching the USSR and the Soviet bloc. This meansthat the U.S. Customs Service can intervene directly in foreigncountries when it believes that vital American technologies are beingdiverted to a denied customer in the Eastern bloc. Since 1981, thiscontrol effort has been dubbed "Operation Exodus." Its aim: to slowthe flow of militarily critical technologies from reaching the Sovietweapons industry, and to disrupt the networks of technobanditsrunning the show. Among themselves, the Special Agents of the U.S.Customs Service devoted to Operation Exodus call themselves the"Techbusters."
Special Agent JD didn't need an earful of details when he got thephone call from his Luxembourg colleague. He scooped up the smallsuitcase which he had made a habit of keeping in a corner of hisoffice at 58bis, rue de la Boetie in Paris, and hopped on the firstflight for Luxembourg. A few hours later, accompanied by theLuxembourg Customs and a representative of Air France, he had rolledup his sleeves and gone to work in a corner of the huge hangar wherethe five suspicious crates were being kept in the Customs zone ofFindel airport.
"I couldn't say I was really surprised, given where the stuff washeaded," Special Agent JD said later. "Still. It was a good haul."Inside the crates he and his Luxembourg colleagues found 3.2 metrictons of sensitive high-tech gear, with a declared value of $573,095.The "rather outdated piece of equipment" being shipped to the USSR byAimé Richardt was in fact a Microetch 10 inch ion beam MillingSystem, used in the manufacture of computer chips. It was preciselyto stop this type of equipment from reaching the Soviet military thatOperation Exodus was set up in the first place. Indeed,microelectronics manufacturing equipment is top on the list ofWestern technologies the USSR has been trying to acquire throughclandestine means over the past fifteen years. And the 55-year oldFrenchman, Aimé Richardt, was one of the USSR's bestsuppliers. At least, until the Luxembourg seizure.
Playing by the rules
The equipment Richardt was trying to ship the Soviets wasmanufactured in the United States by a Long Island company calledVeeco, and distributed in France by Veeco SA, whose headquarters arelocated in Gometz-le-Chatel in the suburbs of Paris. To confuse thetrail leading back to the U.S., Richardt's "mailbox" company, LesAccessoires Scientifiques, purchased the equipment from anothermember of his network, La Physique Appliquée Industries (LPAI)in Grenoble, which slightly modified the machines before turning themover to the freight forwarder for final shipment to the USSR.Classified as "strategic technology" by a decree of the Frenchgovernment, export of these machines is tightly controlled in France.Licenses are required from the Ministry of Industry, the Ministry ofForeign Affaires, and Customs. In certain particularly sensitivecases, exports must be approved by the Defense Ministry as well.
And yet, as the Director of Veeco S.A., Francis Steenbeke, toldthe 7th Chambre Correctionnelle in Luxembourg when the case came tocourt, these procedures were scrupulously "forgotten" by theexporter, Les Accessoires Scientifiques (LAS). Steenbeke testifiedthat his company had clearly marked the invoice which accompanied theequipment to LPAI to show that it had not been approved for saleoutside of France. But documents presented to the court showed thatLPAI's invoice to LAS, the final exporter, simply dropped the exportwarning.. This convenient sleight of hand explains in part why thelocal Customs at Vesoul, where Richardt handled the Customsclearances, were so unsuspecting. Claude Ferry, of the companyFerry-Mougin which transported the goods for Richardt, still recallsthe meeting with Vesoul Customs. "It went as smoothly as dropping aletter in the Post," he said. "You've got to understand that at thetime, we had never even heard of COCOM. What a mess! Still, as far asI'm concerned, Richardt plays by the rules."
But whose rules? Richardt's client, V/O Technopromimport, was muchmore than an innocent "buying office," as Richardt and his lawyersliked to pretend. In fact, this state-run Foreign Trade Organizationhas provided convenient cover for a massive collection effort on thepart of Soviet intelligence over the past fifteen years, to pillagethe high-tech treasures of the West. Two of Technopromimport's DeputyDirectors, Lev Pavlov and Artur N. Zolotarev, were expelled fromGreat Britain in 1971 for "activities unbecoming their diplomaticstatus" - a polite reference to spying. For their efforts, they havebeen rewarded by their respective intelligence agencies. Pavlov todayholds a General's rank in the GRU, Soviet military intelligence,while Zolotarev is a KGB Colonel. Both are specialists in Westerndual-use technologies. They were named to the board ofTechnopromimport in 1980, where they serve today as general staffofficers in Gorbachev's Technology Wars. Aimé Richardt's"Soviet client" is thus no more nor less than a stand-in for the GRUand the KGB. Its principle task: help the Soviet military industrialestablishment catch up to the West, by stealing Western technologysecrets.
The Microetch ion engraver seized at Luxembourg's Findel Airportwas indeed part of a much larger order, as Richardt pointed out tothe French Customs. Contract number 56-08/5254/134 between LesAccessoires Scientifiques and V/O Technopromimport concerned anentire "bubble memory production facility" to be built in the USSR.But there is nothing innocent about "bubble" memories. On thecontrary. These ultra-miniaturized, high-speed integrated circuitshave absolutely no civilian applications. Since the late 1970s,military computers running on bubble memories have been used inNATO's MLRS multiple rocket launcher, its MILSTAR communicationssatellites, and the GRID tactical battlefield computers which havebeen purchased in large quantities by the U.S. Army. Bubble memorieshave several advantages over conventional computer chips which makethem highly sought after by Western weapons developers. Besides theirinherent ruggedness (a GRID laptop computer using bubble memories canbe dropped off the back of a truck by a careless soldier and continueoperating), they are nuclear "survivable," a quality which goes along way toward explaining their presence on the Pentagon'sMilitarily Critical Technologies list - and why the Soviets are sokeen on acquiring them. In the immense heat and Electromagnetic Pulseradiation given off by a nuclear explosion, conventional siliconchips simply melt down. The only computers, communications systems,or weapons which can "survive" a nuclear war are those built aroundbubble memories. And it is precisely this little-known fragility ofconventional computer chips which led the Pentagon to develop bubblememories and, more recently, an even higher performance chip based ongallium arsenide. The Soviets lacked both these technologies... untilthe deliveries of the Frenchman, Aimé Richardt. Today, withRichardt's help, the Soviets today can manufacture both.
For Special Agent JD of the U.S. Customs Service, Richardt is amaster in his trade. "Sure, there are other people currentlyoperating and under investigation in France, but there's noone elsein this country who could shine Richardt's shoes. No one is asprofessional, or as clean. You'll never see Richardt gettingprosecuted under Article 80, Section 2-3 of the penal code [ie,espionage] When he signs a deal, he simply flies to Moscow.,It's all out in the open. He's a brilliant businessman."
A Russophile among the Americans
Who is Aimé Richardt? French and American intelligencesources, who have been monitoring his activities for several years,admit that they have doubts as to his veritable identity, and speakof "enormous holes" in his past. Born the isolated foothills near theGerman border in 1934, Richardt left virtually no traces behind himuntil 1959, when he returned to marry the daughter of a localnotable. "Richardt has no parents, no brothers or sisters that we canfind; nor apparently has he done his military service," Frenchgovernment sources said. "His past appears as if erased by the SecondWorld War," when Hitler's forces occupied the region where Richardtwas born, falsifying, destroying, and altering the local archives."As far as we are concerned, Richardt emerged from total obscurity in1959."
For his few friends, Richardt appears somewhat less mysterious."He's a self-made man," one of his wife's cousins who lives near himsaid. "He moved to Paris with his mother very young, and stayed to dohis studies and to work." Richardt himself enjoys entertaining themystery. Once the French newsweekly l'Express exposed his activitiesin a cover story dated October 16, 1987, he began to distillconflicting versions of his past in interviews with other Frenchjournalists. To a Le Figaro reporter, for instance, he explained thathe came from a working class family, and "only discovered[his] vocation for science while in the military." And yet,neither friends nor family can recall Richardt having served in theFrench army, and this at a period - the colonial war in Algeria -when a young man's military service was not likely to go unnoticed.
Corpulent, a lover of good food and a teller of coarse stories,Richardt has all the trappings of the French provincial notable. Andyet, the obscurity of his past continues to cast a shadow over hislocal notoriety. "Who is Aimé Richardt?" wondered a personalfriend interviewed close to Richardt's residence inLuxeuil-les-Bains. "I've known him for fifteen years. But in the end,I don't know him at all. He's the type of person who never revealshimself. When we see each other, he tells jokes, he speaks of minorthings. But never of business. He keeps his secrets to himself."
What secrets? To begin with, the key to his network of mailboxcompanies, in France and abroad. But also, the key to his personalfortune, which his banker, interviewed in Luxeuil-les-Bains, admittedwas "considerable." Besides the "chateau" of Varigney, where he livesand domiciles his companies, Richardt also owns a four-storeytownhouse in the provincial capital of Luxeuil, an apartment inParis, and a yacht which he keeps on the French Riviera.
Richardt began his career as the European salesman of an Americanfirm, specialized in high-technology fluids. At the age of 35, heenrolled in the University at Lyons, and later presented a doctoralthesis in Nuclear Physics. At least, this the version of his earlycareer he offered to a French journalist, Philippe Hervieux, shortlyafter the L'Express cover story.
In fact, Richardt's connection to Inland Vacuum Industries Inc, ofChurchville, New York, began much later. Why the falsification?"Aimé has a habit of saying such things, trying to increasehis importance," a former boss, Steve Goldschine, believes. "He tendsto alter the details to fit his purpose." Similarly, Richardt toldthe court in Luxembourg that he had been "President of Veeco Francefrom 1958 to 1975," when in fact, Veeco France wasn't evenincorporated until 1967! Before then, Richardt worked as a simplesalesman for Veeco in Europe. If the money was not the best, it gavehim first-hand experience of the high-tech marketplace which wouldprove invaluable later on. Richardt also speaks several languages,including excellent English and passable Russian, which he claims tohave learned on his own - part of the self-man image he so carefullycultivates.
With the technological advances of the 1960s, Veeco soonspecialized in micro-electronics manufacturing equipment, a rapidlyexpanding field, and Richardt followed them every step of the way. In1967, Veeco set up its French subsidiary, and hired Richardt as afull time salesman. Business was so good that Richardt was able tomove from his rented flat and build his own house in a residentialsuburb of Paris.
But in 1975, Veeco fired Aimé Richardt. Why? SteveGoldschine prefers not to go into the details: the Luxembourg case,in which his company was directly involved, left a bad taste in hismouth. "Let's just say that Richardt did not leave us in glory.Aimé has had a rather chequered career."
While at Veeco, Richardt made many trips to the U.S., and was ableto familiarize himself with the U.S. semi-conductor industry. By thetime he was fired by Veeco, he knew who made which type ofspecialized equipment, and how to go about purchasing it withoutarousing undue suspicions. It was precious knowledge for someone whowas to supply one of the VPK's best "collectors," V/OTechnopromimport.
Court documents in Luxembourg show that Richardt began working forthe Soviets around 1973, when he organized the export of Veecomicro-electronics manufacturing equipment through a French company,La Physique Appliquée Industries (LPAI).
The date is worth noting. According to a well-known U.S. computerexpert working at the Los Alamos National Laboratory, Dr. LaraBarker, this was precisely when the Soviets first realized they had a"computer gap" with the West, and were seeking "to close thetechnological gap between themselves and the U.S. in the integratedcircuit/microcomputer industry."
According to Dr. Barker, the first Soviet attempt to illegallyacquire semi-conductor manufacturing equipment occurred in 1974-75.It was orchestrated by a pair of German businessmen whose names havesince become indelibly associated with the term "technobandit":Richard Müller and Volker Nast. Müller's exploits have beenthe subject of numerous newspaper articles and books Believed bymany counter-espionage experts to be an "illegal" Soviet agentinfiltrated into the West, Müller's last known attempt toprocure embargoed Western technologies was broken up in 1983, when adelivery of VAX 11/782 mainframe computers was seized in Sweden. Athis peak, Müller operated some 60 front companies in half adozen countries, and travelled on any of a variety of passports. Whenthings got hot in one place he would simply pick up stakes and set upshop in another country. So far, both he and his partner, VolkerNast, have eluded arrest.
Another high-tech ring mentioned by Dr. Barker in his Senatetestimony was led by Werner J. Bruchhausen in 1978-80. Working withsuppliers in California's Silicon Valley, Bruchhausen set up anentire computer chip manufacturing plant in the USSR forElektronorgtekhnika (Elorg) V/O, another Soviet "buying office." Onthe run for years, thumbing his nose at U.S. Customs duringsurrealistic television interviews on the BBC, Bruchhausen wasfinally arrested in May 1985 and extradited to the U.S., where he wassentenced to 15 years in jail on March 30, 1987.
"We delude ourselves if we think the Soviets enter the blackmarket in search of strategic components in a helter-skelter style,buying up dual-use commodities without rhyme or reason," Dr. Barkertold the U.S. Senate. "The truth of the matter is that the Sovietsand their surrogates buy nothing they don't have specific,well-defined needs for. They know exactly what they want - right downto the model number - and what they want is part of a carefullycrafted design."
In the case of Bruchhausen and Müller, that design was "thepurchase of semi-conductor manufacturing plants," absolutelyessential if Soviet weapons development was not to fall irremediablybehind the West.
What Barker did not say - and, in 1982, probably did not know -was that the Frenchman Aimé Richardt was selling precisely thesame type of equipment to the USSR at the same time as Müllerand Bruchhausen and other notorious "technobandits." Court documentsshow that Richardt first began to deliver ion implanters used insemi-conductor manufacturing in 1973 - and with French governmentapproval, to boot! - and did not stop for more than fourteen years.His "BIF-1" and "BIF-2" contracts with Technopromimport involvedentire production lines which, in 1986, were supposed to lead to an$80 million project to build a large-scale bubble memory factory forthe Soviet military. As Dr. Barker put it, the Soviets "showed nointerest in purchasing production equipment that was not state of theart. They showed very good taste." And that taste was evident in theequipment delivered by Aimé Richardt.
The biggest difference between Richardt and Richard Müller orWerner Bruchhausen is that Richardt has managed to act with impunity.Some believe he has benefitted from active complicity within theFrench government. This is why his case is sometimes referred to as"the French Scandal."
Burlingame
On April 23, 1986, the U.S. Customs struck again. Acting on insideinformation, they seized a second Richardt cargo headed for the USSRvia France, this time at Burlingame airport in California. Theequipment seized was worth a mere $233,000. But it had the effect ofgetting Richardt, LAS, and his subcontractor, LPAI, on the Departmentof Commerce Denial List. This meant that any American company caughtselling U.S. technology to Richardt could be prosecuted under U.S.law. It was an effective deterrent.
"We got a temporary denial order issued against Richardt," saidMark Menafee, a strategic export controls officer at the Departmentof Commerce. "This procedure is designed to counter the threat of animmanent export control violation and can only be renewed if weprevent serious evidence." The two-month temporary denial orderagainst Richardt was renewed six times starting on April 23, 1986.The Frenchman's case was considered "extremely serious" by the DoC.But because he had not been brought to trial in the U.S., he couldnot be permanently black-listed. Officials would not rule out thepossibility of a sealed warrant against him which would make Richardtliable to arrest if he ever set foot on U.S. soil - a mistakeRichardt has been careful not to make.
Black list, clean rooms
Before Richardt was blacklisted, he was one of the best customersof a California manufacturer of semi-conductor manufacturingequipment, the Quad Group. He also bought sophisticated U.S.-builtequipment from Pacific Western, Rudolph Research Corporation, Veeco,and Technics. Since the Burlingame seizure, he was forced to goelsewhere.
Richardt's relationship with the Quad Group went back many years.Documents made available during this investigation show that he wasalready negotiating major contracts with this Santa Barbara companyin 1980. On October 1, 1981, Richardt signed a contract with Quad for"a modular production unit" for bubble memories, which he billed toTechnopromimport for $4.2 million.
Quad was the primary supplier for this pilot production plant.According to the contract, Quad served as Richardt's "agent" in theU.S., and for more than two years contacted U.S. manufacturers on hisbehalf, buying embargoed microprocessor manufacturing equipment, andshipping it over to France. In France, Richardt and his primaryaccomplice, LPAI, changed the documents and altered the equipment,then shipped the embargoed goods on to the USSR without a care.
In 1983, Richardt began negotiations with the Russians for thesecond phase of the bubble memory plant. This contract, known as"BIF-2," covered four more Class 100 "clean rooms," mini-productioncells where highly-specialized workers manufactured computer chips ina dust-free environment. For $6 million, Richardt supplied the VPKwith bubble memory production equipment which is today in use in theUSSR - exclusively by the Soviet military.
Richardt went to Moscow on May 17, 1984 to sign the BIF-2 contractwith Technopromimport. The Soviet intention was excessively clear: toacquire not only the equipment, but the know-how necessary to beginbubble memory production. Before each new phase of the contract,Soviet technicians were supposed to come to France for advancedtraining, which Richardt billed at $187,000 per four week session.The "classes" were held in a high-tech center on the outskirts ofGrenoble, at the headquarters of LPAI. This was such an integral partof the technology transferred by Richardt to the Soviets that one ofthe four BIF-2 clean rooms was initially installed in France to trainthe Soviet technicians. Because of the relatively high-cost of theprogram, Richardt claims the Soviets cancelled the training segmentin 1987. In fact, French counter-espionage sources say, they stoppedonly after the DST tried to recruit visiting Soviet "technicians" inGrenoble.
The fact that the Quad Group was obliged to cut of its lucrativecommercial arrangement with its excellent French client, AiméRichardt, in June 1986, was only a momentary problem for theFrenchman. As he explained himself, when contacted in Paris afterreturning from one of his numerous business trips to Moscow, "themain result of this affair is that we have stopped buying equipmentin the United States. Now we buy in Europe. The League of ConcernedScientists - which certainly cannot be suspected of pro-Sovietsentiments - has estimated that U.S. business loses $9 billion everyyear because of this stupid COCOM policy. I couldn't care less. Ihave already made my decision. We don't buy anything from theAmericans any more. Not even a pencil!"
Despite the lapidary formulation, Richardt's statements strayedfar from the truth. He would continue to buy from the U.S., but in afar more roundabout fashion than before.
On the copy of the BIF-2 contract made available to the author,Richardt or one of his associates had already pencilled in alternatesources for the equipment previously supplied by Quad. On page 1,Quad Group was replaced by the French subsidiary of the Japanesecompany, Rigaku. On page 2, Semy Engineering of Montpellier replacedPacific Western (Semy would later go bankrupt largely because of itsconnections to Richardt). Other "new" suppliers pencilled onto thecontract were LPAI, Quantronix-France, Veeco S.A. (which continued toimport U.S. equipment), Nikon-France, Hitachi France, Ferrofluides(West Germany), Karl Suss France, and Tempress France. Asked toexplain his continued business with the USSR by L'Express, Richardtreplied smugly: "I work for a large French bank. My job is toexport."
And Richardt continued to export, despite increasing problems withCustoms and the COCOM regulations. It wasn't because the complexityof the regulations confounded him. On the contrary. Richardt spentnights poring over the COCOM rulebooks, examining court casesinvolving technobandits convicted in the U.S., searching forloopholes which would allow him to continue his lucrative businesswith the USSR. To their astonishment, the French counter-espionageagents who raided Richardt's headquarters at Varigney in 1987discovered box after box of obscure public documents on Americantechnology security policy Richardt had acquired through the Freedomof Information Act. This was a legal procedure used to declassifygovernment documents which was so complex that few Americanjournalists even mastered it. And yet, here was a French businessmanwho had clearly used it to procure information which he found usefulfor his high-technology trade with the VPK. The DST also discoveredthat Richardt had an on-line computer link to U.S. high-tech databases such as the DoD's ELISA, which provides daily updates onhigh-tech export license applications.
Going through the U.S. documents, Richardt discovered numeroustricks for bypassing the COCOM rules. One of these was exposed in theLuxembourg case, when Richardt's principle front company, LAS, actedas a French importer of U.S. equipment (which was totally legal),then re-exported it without declaring its U.S. origin (which wasnot). Later, when the French authorities began to get wind of thissleight of hand, LAS would sell the equipment to other companiescontrolled by Richardt or by his powerful partners at Sogexport, atrading company owned by the State-controlled bank,Société Général. Their mission was tochange the labels on the equipment and alter the documents todisguise the U.S. origin, before shipping the equipment on to theUSSR. These complex, and costly, procedures fooled French Customs foryears, and gave rise to the expression "the Richardt Nebula" withinthe French administration, to describe the complex mix of frontcompanies and official complicities which allowed Richardt tocontinue his traffic virtually unhindered.
The Network
On April 13, 1975, shortly after leaving Veeco-France, Richardtbegan laying the groundwork for his Network. With a small core ofassociates which has scarcely varied until today, he set up his firstcompany, Les Accessoires Scientifiques, which he ran out of his homein the Paris suburb of Fontenay-les-Briis. Among the associates wereAndré Noirot, who serves today as a director of Sogexport andof several other Richardt companies; Roger Locrai, who heads LPAI inGrenoble; an accountant, Christian Duverdier, who first met Richardtat Veeco in 1967 and still works for him today; and an American namedRaymond D. Mathis, from Long Beach, California.
LAS, as it was generally called, was for many years the center ofthe Network, and was set up from the start as a trading company forscientific equipment and instruments and related services. In 1987,the company statutes were expanded to include "all industrial,commercial, or financial operations" relating to scientificequipment. In other words, LAS could not only buy and sell high-techequipment, it could buy and sell companies trading in high-techequipment as well, making it a perfect front in what was to become anelaborate shell game.
Two years after he set up LAS in 1975, Richardt created a secondtrading company with a different American partner. Inland EuropeSARL, incorporated on November 29, 1977, was set up as an equalpartnership between Richardt and Michael H. Meyer, the President ofInland Vacuum Industries of 35 Howard Avenue, Churchville, New York.Besides marketing scientific equipment, the new company was achartered sales agent for Inland's wide array of high technologylubricants, including silicone fluids and greases. On the surface, itwas an innocuous activity. But because of the extreme purity of thelubricating oils needed for the high temperature ovens used to "bake"silicon wafers, many of Inland's products were embargoed under COCOMitems IL 1702, IL 1755, etc. Hence, Aimé Richardt's interestin gaining unhindered access to them Without these oils, even thebest chip manufacturing equipment in the world would grind to ahalt.
In 1982, Richardt's wife inherited the family Chateau in Varigney,a five-hour drive from Paris - and even further from the prying eyesof COCOM. In July, Richardt transferred his companies to his newhome, registering them at the local courthouse in the provincialsous-préfecture of Lure.
At the same time, Richardt expanded his contacts with theSociété Général's export branch,Sogexport, and succeeded in bringing Sogexport director, ChristianAmalric, onto the LAS Board the next year. Winning the official coverthat only a state-owned bank could provide was a stroke of genius onRichardt's part. And the need was urgent: in June 1983, a U.S.Customs attaché from Paris travelled down to Varigney andvisited Richardt's chateau, asking him to provide information on hiscontracts with Technopromimport. Feeling the heat, Richardt hired aU.S. attorney, Robert A. Blackstone, known as a skilled defender inother COCOM-related cases, to plead his cause with the Department ofCommerce. He also lodged a complaint with French Customs, which upuntil then had defended his Soviet business. By winning theSociété Général to his cause, Richardtbelieved he would be protected by an impenetrable shield. Any U.S.move against him would quickly escalate into an affair of state.
Nevertheless, Richardt hedged his bets. In 1985, he sold LAS for ahandsome profit to Sogexport, and became a well-paid CommercialEngineer for the state-owned export house. In the meantime, he boughtup a series of other shell companies which could be used for variousbusiness deals with the Eastern block. These included Neyco SARL,Decrona SA, and Sedame SA, which were purchased from 1984-87.Richardt's principle associates in all of these were Amalric, theDirector of Sogexport, and two other Sogexport Board members,André Noirot, and a French baroness of Russian descent, Axellede Saint-Affrique (née Tikhmenev).
When LAS was put on the Department of Commerce black list in 1986,for instance, Richardt simply transferred the Soviet contracts to theother shell companies, which at that time were unknown to the U.S.authorities. To keep business discrete, he appointed his 23-year olddaughter as General Manager of one of the companies, Neyco, whichtook over the most lucrative contracts. From Soviet sales whichRichardt announced at nearly $40 million, LAS's turnover shrank tobarely $1 million by 1988. The rest had been farmed out to Neyco,Sedame, and Decrona.
Shortly before LAS was blacklisted, Richardt received an Americanvisitor at his home in Varigney. Concerned by the Luxembourg seizure,the American rushed over to France to settle accounts with one of hiscustomers. His name was Ken Purser, and he ran a company called ION-Xin Newbury, Massachussetts. He drove the five hours from Paris to theHaute Saone in a rented car and spent the night.
ION-X was one of the Network's best suppliers of ion engravers.When Richardt was forced to break relations with the Quad Group inCalifornia, for instance, ION-X came to the rescue. Later, Ken Purserwould even testify in Richardt's favor before a Grenoble court,presenting himself as a University Professor specialized inmicro-electronics (and not as one of Richardt's suppliers).
But despite the court cases, the black-listing, and the suddenexposure of his dealings with Technopromimport, Richardt's businesscontinued to boom. So at least he wanted the press to believe.Speaking to journalists as he entered a Grenoble courtroom onFebruary 28, 1989, where he stood accused of COCOM violations by theFrench Customs, Richardt claimed that he had just returned fromMoscow where he "withdrew commercial bids worth $50 million" at therequest of the Société Générale. Thingswere beginning to get hot.
Gallium arsenide, the summum of Western military technology
And for good cause. U.S. intelligence had learned that Richardthad concluded a major new contract with Technopromimport, which wouldmake his previous deals look pale. If it went through, the VPK stoodto get one of the most sensitive strategic technologies of the 1980s,whose secret had been preciously guarded by the West - essentially,the U.S. - until then. It concerned a new type of computer chip basedon a substrate called gallium arsenide, which the Pentagon hopedwould make it possible to build faster, smaller, and more powerfulcomputers than ever before. GaAs research was heavily subsidized bythe Pentagon because of it was believed to hold the key to PresidentRonald Reagan's Strategic Defense Initiative.
One of SDI's major stumbling blocks was the so-called "battlemanagement" software which had to coordinate hundreds of orbitingsatellites, sensors, and thousands of rockets - and make them work -during an all-out Soviet missile attack. With existing technologies,the computer software would require millions of lines of programming,taking millions of man-hours to develop - without ever being certainthat it would function correctly. To convince sceptics that thebattle management problem could be licked, General James Abramson,head of the SDI Organization, liked to show up for Congressionalhearings with a specially-designed attache case. Inside, he said, wasa technological marvel that would make the software problem a thingof the past. It was a revolutionary main-frame computer with enoughmemory to contain the entire battle-management program in itshardware, in a series of simple commands. Dozens of theseultra-miniaturized computers would be lifted into space where theywould control their own satellites and missiles independently of anycentral system. The secret of this new marvel: gallium arsenidechips.
In November 1986, instead of appearing before the 7th CriminalCourt of Luxembourg, as he was scheduled to do, Aimé Richardtwas in Moscow negotiating the gallium arsenide deal with theInstitute of Solid Physics of the University of Lvov, one of the manyresearch laboratories working for the Soviet military-industrialcomplex.. Pentagon officials acknowledged that Richardt was gettingready to deliver the Soviets a technology "of immense military andstrategic value." Technically known as Molecular Beam Epitaxy, orMBE, it was the mass production process (the chronic Soviet weakness)for gallium arsenide wafers. Once the DIA learned of Richardt's newcontract, it began a race against the clock to keep this vitalstate-of-the-art technology from falling into Soviet hands. For oncethey had the wafers, the Soviets could "engrave" GaAs chips.
The DIA telexed its French counterparts shortly after the crucialstage of Richardt's negotiations in November 1986. This telex, whichwas made available to the author, warned that the first phase of thecontract, signed in March 1986 and worth $7.2 million, had probablyalready been implemented. This concerned a "pilot production unit forthe study of gallium arsenide" and the "manufacture of smallquantities of custom-designed computer chips." The French were takenaback. At first they thought the DIA was referring to U.S.-builtequipment sold to Richardt by ION-X, and for which Richardt hadapplied for export licenses for the USSR. But they were wrong.
Gallium arsenide technology was so new, and so secret, thatAmerica's NATO's partners were peeved that the U.S. had never sharedit with them. In June 1987, the French Armaments Directorate conveneda conference of European R&D officials in Paris, and proposedthey jointly invest some $80 million in GaAs research as part of theEureka European technology initiative. Until then, only a handful ofAmerican firms possessed GaAs technologies, and they were the allamong the Pentagon's top contractors: TRW, Rockwell, Westinghouse,Honeywell, and Hughes. It would be several years before GaAs wouldhave civilian applications. Even so, the world market for GaAs wasexpected to reach several billion dollars/year by 1992. If Richardtsucceeded, the Soviets would be in a good position to master thisnew, strategic, and potentially lucrative technology.
Although Richardt and his "boss," Christian Amalric, initiallydenied they had exported GaAs to the USSR when confronted ininterviews, Richardt later nuanced his position. "We have justpresented the [Industry] Ministry with a request to exportthis type of material," he told the Est Republicain on October 19,1987, but "I have never received a reply." The French licensingofficers interviewed shortly afterwards exploded. "You'd betterbelieve he never received a reply! Richardt wanted us to go to COCOMon this one. Can you imagine? We would have been hooted right out theroom!"
Where did Richardt think he could acquire GaAs technology? The DIAwas on his trail, he had only recently been dropped from the DoCblacklist. His name was well known to both the U.S. and Frenchlicensing authorities. It was not going to be easy for him toapproach American high-tech companies without being recognized.
But Richardt had no intention of turning to the U.S.. His "source"- or at least, so he hoped - was a 48-year old French researcher ofVietnamese heritage, who had worked on a GaAs project forThomson-CSF. His name: Linh T. Nuyen. And it was Linh himself whooffered the following account of how Aimé Richardt was hopingto use his services to equipment the Soviet Armed Forces with theequipment needed to break NATO's most secret radar codes..
A French source
In 1979, Linh headed a research team at Thomson's Central ResearchLaboratory in the outskirts of Paris, which succeeded in developing agallium arsenide chip called a high mobility transistor, or HEMT.Like many brilliant researchers eager to cash in on their success,Linh soon became frustrated working for an industrial behemoth. Hedreamed of "living an American-style adventure," and struck out onhis own in February 1986 along with two fellow researchers. With theblessings (and a small grant) from the French Armaments Directorate,the three semi-conductor wizards set up their own company in theParis suburb of Les Ulis, which they called Picogiga. Today, Picogigaemploys twenty persons and sells its gallium arsenide wafers to chipmanufacturers. In the first five months of 1989, the new company didmore than a million dollars worth of business.
"It's true that Richardt approached me," Picogiga President LinhNuyen said. "I've known him for a couple of years. He used to be oneof our suppliers of high technology oils and accessories when I wasat Thomson. Richardt came to see me sometime at the end of 1986,shortly after we started up Picogiga. He said he wanted to market ourproducts in the Soviet Union. I told him: go ahead, just make sureyou have an export license first. I never believed he would getone."
Did Linh encourage Richardt's commercial instincts, or merely playalong? "I gave him spec sheets and a price list for our products - nosecret about it. Richardt said the Soviets were more interested thegallium arsenide wafers themselves than in the manufacturing process,which was fairly complex. He still hopes to export them to the USSR.He calls me from time to time telling me that with perestroika weought to start up a joint venture with the Soviets. Who knows?"
Linh Nuyen is no naif. He is fully aware of the strategic value ofgallium arsenide, and voluntarily admits that "in the Soviet Union,there is absolutely no civilian application for this type oftechnology. Not one." He has worked as a subcontractor for thePentagon's vast MIMIC (millimeter wave microwave monolithicintegrated circuits) program. His company was awarded a prize forexcellence by the American jury for its work on GaAs at COMDEF '88 inWashington, where the most advanced defense electronics companies inthe West get together to define the state-of-the-art in their field."One of the most critical applications for GaAs technology is inmilitary radars," Linh said, "where you need higher and higherfrequencies to keep the enemy from detecting your emissions. WithGaAs, you can get frequencies of several gigahertz, whereas todayyou're talking in the megahertz range."
The military interest in GaAs radars - a critical "stealth"technology - is therefore enormous. The greatest weakness of today'scombat aircraft derives from their very sophistication. The momentthey turn on their radar sensors (to detect enemy aircraft, or to"lock-on" to a target) they reveal their position, like someoneshouting in a cave. The high frequencies obtained with galliumarsenide make the radar emissions more discrete: they turn the shoutinto an ultrasonic whistle, which only a similarly tuned ear can pickup. Once the Soviets master this new technology - with AiméRichardt's help? - NATO stands to lose one of the most importantcomponents of its "qualitative edge" over the Warsaw Pact: itsoverwhelming superiority in battlefield radars.
The Grenoble caper
Since the seizure in Luxembourg, Richardt's troubles with Customshave only increased. But he has fought them tooth and nail eversince. After fourteen court appearances stretched over nearly threeyears, Richardt's lawyers got criminal charges against him dismissedon December 3, 1987. Still, the court upheld the Luxembourg Customsdecision to seize the Microetch ion engraver Richardt was trying toship to the USSR, because of its "strategic" nature.
Other men would have called it a day. Not Aimé Richardt. Hesent his lawyers back to their books, and on April 11, 1989 they wona decision from the Luxembourg Appeals Court which not only liftedthe seizure order, but condemned Customs to pay LAS extensivedamages. Customs appealed, and the case continues to drag on. Atthis rate, Richardt's machine could remain in a Luxembourg Customsshed for some time to come.
In January 1988, the French administration finally moved againstRichardt, acting on direct orders from the Minister of State forEconomy and Finance, Edouard Balladur (Prime Minister JacquesChirac's right-hand man). With pusillanimous discretion, Customsopened proceedings against Richardt for strategic export controlviolations... and leaked the news to the press only hours before ahigh-level COCOM meeting was scheduled to start in Versailles, wherea tense U.S. delegation had come intending to call the French toorder on Richardt and Forest-Liné. .
Sources within Balladur's cabinet said the file against Richardtwas "incredible. We've got documents up to the ceiling." But despitethe fact the French Customs code was beefed up in March 1988, for thefirst time providing a three-year jail sentence for export controlviolations, the case was allowed to drop.
One case which was not dropped was developed by a small, localCustoms unit in the town of Saint-Egrève, near Grenoble.
On December 23, 1988, the freight-forwarder CalbersonInternational submitted a "definitive export form," No 424761, to theSaint-Egrève customs on behalf of their client, Neyco S.A.Neyco was a full-fledged member of the Richardt "network," officiallymanaged by Richardt's daughter. Once again, the equipment Richardtwas trying to ship was related to computer chip manufacturing, andonce again the Soviet client was V/O Technopromimport. As far asNeyco was concerned, the "particle accelerator" it had sold theRussians for some $741,000 was "free for export." But AiméRichardt could see the writing on the wall.
"As an additional precaution," his lawyer later told the court,Neyco's export declaration was accompanied by reports from two"independent" experts intended to prove that the "particleaccelerator" was not subject to strategic export controls. One of theexperts was Richardt's American supplier, Ken Purser, the Presidentof Ion-X company of Newbury, Mass. Another was a distinguished Frenchresearcher Richardt had come to know through his commercialactivities on behalf of American firms.
But this time, the procedure backfired. Instead of reassuring theCustoms officers, the expertise made them suspicious. They impoundedRichardt's equipment on the spot, and hauled it to a nearby Armycamp. Four days later, the crates were opened in Richardt's presence,and a long legal battle began.
Richardt was not like other "ten percenters," as U.S. Customsofficials liked to call them. Instead of fleeing confrontation, ormoving from country to country once his operations attracted theattention of the local authorities, he chose to fight the systemthrough the Courts. In Grenoble, his lawyers disputed the "strategic"nature of the machine that Customs seized, and called in a bevy oftechnical experts to determine whether it was a "heavy ion generator"(which was embargoed by COCOM), or a "particle accelerator" (whichwas not) . Richardt claimed to have downgraded the machine to meetthe export rules.
He had good reason to do so. From May to October 1986, Richardtmade no fewer than eleven export license applications, worth some $50million, to ship embargoed ion implanters to micro-processormanufacturing plants in the USSR. So extensive was the business, oneFrench licensing official said, that "Richardt has become theSoviets' principal source of ion implanters." Most of these machineswere probably intended for the third phase of the BIF contract, thelarge capacity bubble memory production plant Richardt hoped to buildin the USSR - the same bubble memories that Steve Bryen said werebeing used by the Soviets to upgrade the guidance systems of theirballistic missile fleet..
When the licenses were rejected, Richardt came up with a solution:he had his American suppliers, Tanditron and Ion-X, directly apply tothe Department of Commerce in Washington. As luck would have it, theDoC approved a sale of normally-embargoed ion implanters to Richardtin August 1987, despite his presence on the Denial List only threemonths earlier. Waving this paper, Richardt went to see the sameofficials who had turned down his earlier applications. "When we sawthat DoC paper, we were pissed," one French COCOM officer said. "Whatdo you want us to do, be more royalist than the King?"
Political support
The Richardt case is considered something of a "national shame" bythe high-ranking French officials who handle COCOM affairs. "As longas Richardt runs free, he continues to damage our credibility," oneofficial said. "He's definitely a thorn in our side," said anofficial in another ministry. Without exception, the men whose job itis to police French strategic exports consider Richardt to be a primetarget for their enforcement efforts. He has been taken to court byCustoms, investigated by the DST, his export license applications areclosely tracked by the Ministry of Industry, the Quai d'Orsay, andthe Ministry of Defense. And yet, he continues to slip through thenet. Why?
"Technobandits like Richardt," said Dominique Lamoureux, who headsthe Strategic Export Control unit at the French defense electronicsgiant, Thomson-CSF, "tend to cloud the real issues facing COCOM.These are technical, economic, but also political. I wonder whetherall the publicity this affair has received isn't in fact intended todestabilize the real efforts undertaken by the French government toset up a balanced and efficient system of controls."
In other words, the more headlines Richardt's disputes with theCOCOM authorities receive, the less credible the regulations seem.And the more other potential technobandits may be tempted to followthe same path.
Already in 1987, the Quai d'Orsay formally asked Richardt "toreorient his activities, because they do not coincide with theinternational obligations of France," officials said. But Richardtcontinued nevertheless. For instance, his most recent project, whichwas submitted to the French authorities for approval in early 1989,concerns building an assembly line in the USSR for French-builtmicrocomputers.
How does he do it? First of all, Richardt is a skilledbureaucratic fighter, who knows how to profit from the ambiguities inFrench and European export control legislation. And he is stubborn.Anyone else would have given a sigh of relief at the end of 1987 whenthe Luxembourg court exonerated him of criminal wrongdoing in theMicroetch case, and considered changing the focus of his businessactivities. Not Aimé Richardt.
Richardt has also taken to harassing journalists. Shortly afterl'Express exposed his relations to Technopromimport in October 1987,Richardt's lawyers sued the magazine for more than $1.3 million.Although he lost the first leg of the suit, Richardt has alreadyappealed, and the case could drag on for many months to come. Butwhether he wins or loses is of lesser importance than the lawsuitsthemselves. Richardt's principle aim is to discourage thepublicity-shy enforcement authorities, and to deter the press.
Some, such as Special Agent JD, believe that Richardt's intentionsare even more nefarious. "Richardt's real aim is to attack COCOM, toweaken the control regime itself and strike a blow against thefragile web of solidarity uniting the Western countries" on thetouchy subject of strategic export controls. At the French Ministryof Industry, which regularly refuses Richardt's export licenseapplications, his case is considered unique. "This is the first we'veever had someone like this directly attack the export controlsystem."
Richardt has actively sought approval for his activities in Frenchpolitical circles. Anti-American sentiment can be found from left toright of the French political spectrum, and Richardt has played it tothe hilt. The U.S. uses COCOM as an instrument of economic warfare,he argues, to sabotage French exports to the USSR. Richardt's backersare so well-placed, he brandishes them like a calling card. "If wehave succeeded in obtaining [political] support," he casuallyremarked in one interview, "it's a sign that our politicians are moreintelligent than our bureaucrats."
Interestingly enough, it is the French right which most activelysupports Richardt in his battle against the French administration.For instance, Roland Nungesser, an RPR Deputy with links to formerrightist Premier Jacques Chirac, personally decorated Richardt onOctober 6, 1986 for his contributions to the French export economy.Nungesser, who also happens to be the President of the Franco-SovietChamber of Commerce, has helped Richardt in his struggle with theFrench administration. Support has also been forthcoming from theFrance-USSR Friendship Society, which regularly sponsors tours of theSoviet Union for politicians, journalists, and businessmen.
Another right-wing politician who has actively come to Richardt'saide is Robert-André Vivien, also an RPR Deputy. Vivien'sbrother-in-law once worked as a freight-forwarder for Richardt, andVivien himself has championed Richardt's cause in an appeal presentedbefore the French Supreme Court in 1986, intended to free up exportlicenses blocked by the administration. According to governmentsources directly involved in the Richardt case, Vivien "personallyintervened in Richardt's favor.with our office on several occasions.Other times he did so through intermediaries."
Richardt's "friends" have also big-footed at the Quai d'Orsay, thelead agency for COCOM policy in France. This time Richardt's guardianangel was a member of Finance Minister PierreBérégovoy's cabinet, who went so far as to attempt toforce the premature retirement of "Richardt's worst enemy" at theQuai. After months of coming under fire, the official was forced fromParis to a foreign posting, far from COCOM responsibilities.
Richardt likes to deny responsibility for any wrong-doing underthe pretense that all his activities have been "covered" by hiscurrent employer, the state-owned bank, SociétéGénéral. And he is right.
But the truth goes much farther. Richardt's "cover" is alsoprovided by French politicians, even judges, in pivotal positions. Sotroubling, and inexplicable, is Aimé Richardt's continuedimpunity that many of those investigating his relations with the USSRbelieve he is not the simple French businessman that he pretends.