Spy Father, Spy Son? Ex-CIA Official Charged Again

Jan. 29, 2009— -- A former CIA official convicted a decade ago of espionage has continued to operate from prison and has recruited his son to help him sell information to Russia, according to a federal indictment unsealed today.

Harold Nicholson, 58, and his son Nathaniel, 24, have been indicted on conspiracy, acting as a foreign agent and money laundering charges for allegedly accepting cash for spy activities from contacts in Russia. Each pleaded not guilty to the charges at his arraignment.

The elder Nicholson pleaded guilty in 1997 to espionage charges after admitting to selling U.S. secrets to Russia. He is serving a 23-year sentence at a medium-security federal prison in Oregon.

According to the indictment, "It was part of the conspiracy that defendant Harold James Nicholson utilized his CIA training in instructing defendant Nathaniel James Nicholson on how to collect the funds from the Russian Federation in a covert and secret manner."

The father had been an instructor at the the CIA's training facility known as "The Farm" outside of Williamsburg, Va., before his arrest.

Meeting Russians Around the World

The indictment claims Nathaniel Nicholson applied for a U.S. passport in August 2006 so he could travel internationally "to meet with the Russian Federation to collect money" for him and his father and "to provide information" from his father to his contacts.

The son allegedly collected more than $35,000 after meeting with Russian handlers in Mexico, Peru and Cyprus in several meetings between 2006 and 2008.

According to the indictment, Nathaniel Nicholson received $5,000 in U.S. currency from a Russian handler in October 2006 and was instructed by agents of the Russian Federation to go to Mexico City, Mexico, for another meeting in December 2006.

Harold Nicholson allegedly instructed his son to only bring in less than $10,000 in U.S. currency after meeting the Russian representatives. The final meeting between the son and the Russians allegedly occurred on December 10, 2008, at a TGI Friday's restaurant in Cyprus.

"When approached by a representative of the Russian Federation, defendant Nathaniel James Nicholson used the 'password phrase' provided to him by the Russian Federation in Lima, Peru, to prove his identity," the indictment claims.

At that meeting, the son allegedly accepted $12,000 in U.S. currency and received instructions for his next meeting with Russian agents in Bratislava, Slovakia later this year.

Accused of Recruiting Inmates to Spy

Prosecutors also allege that Harold Nicholson "has attempted to use other inmates at FCI Sheridan to assist him in his efforts to communicate with the Russian Federation on his behalf" since at least June 2000.

Calling this an "amazing case," David Ian Miller, the special agent in charge of the FBI in Oregon, said, "Harold James Nicholson, a convicted spy, was allowed to serve time in a federal prison in Oregon to be near his family. Without regret, he used that proximity to his family to continue contact with the foreign country for which he was previously convicted of spying."

Nathaniel Nicholson lives in Eugene, Ore., according to the Justice Department.

Prosecutors are also attempting to recover funds allegedly provided to Nathaniel Nicholson by Russian entities, claiming that they are proceeds of his father's espionage.

The Nicholsons could each face sentences of up to 100 years in prison if convicted of all charges.

Harold Nicholson's Criminal Past

Harold Nicholson, who had held posts all over Asia and Eastern Europe, is the highest-ranking CIA officer to face espionage charges. He pleaded guilty to espionage charges in 1997, and a federal judge sentenced him to more than 23 years in prison.

He had begun selling U.S. secrets to Russia three years earlier, after the end of the Cold War era.

"I believed that I could work both for the CIA and for the Russian service at the same time. Russia was no longer the Communist government they had," he said in a 1997 prison interview aired on ABC News' Nightline. "They were not our number one enemy anymore. Our No. 1 enemy, in my opinion, is terrorism, and the Russians were working with us against terrorism."

According to court documents filed in the case, Nicholson, who started with the agency in 1980 and rose through the ranks to become a station chief in Romania and later an instructor in the classified CIA Special Training Center in Virginia, "held a 'Top Secret' security clearance, and had regular, frequent access to sensitive classified information."

'No One Was Killed'

In 1994, when he received his first $12,000 payment from the Russians, Harold Nicholson was working in Malaysia, where part of his job was to target Russian intelligence officers for recruitment.

In the two years of secret meetings with Russian contacts in Southeast Asia and Europe, he came under the scrutiny of those within the CIA.

After a series polygraph examinations and a CIA review of his personal records showed a pattern of international travel and unexplained deposits into his financial accounts, he was arrested at Dulles International Airport outside Washington, D.C.

By then, he had collected $300,000 from his Russian contacts. But in the 1997 interview, he downplayed the severity of his actions.

"No one was killed. No one was tortured and the only person that was arrested as a result of my action was me," he said.

But court documents indicate that Nicholson provided biographical and assignment information on CIA personnel to the SVRR, the successor organization to the USSR's infamous KGB.

Despite his conviction, Nicholson maintained that he was not the typical spy.

"I wasn't disaffected against my country. I had never shown any kind of criminal past or anything of this nature. I had a family who was patriotic. All of my friends were patriots," he said in 1997.

"There was nothing other than the fact that I just found myself in an untenable situation and I didn't know how to get out of it."