Boeing Called A Target Of French Spy Effort

WASHINGTON - The Boeing Co. was among the targets of a French government plan for a massive spying effort to learn U.S. technological secrets and trade strategies, according to classified documents.

The plan targeted 49 high-tech companies, 24 financial institutions and six U.S. government agencies with important roles in international trade, the French documents show.

The plan focused on research breakthroughs and marketing strategies of leading-edge U.S. aerospace and defense contractors that compete directly with French firms.

The French also sought advance knowledge of the bargaining positions of American negotiators in trade talks involving France. The 21-page assignment sheet, prepared by the French equivalent of the Central Intelligence Agency, is considered authentic by senior U.S. experts.

A French Embassy spokesman in Washington, after conferring with officials in Paris, responded: "There is nothing in this document to indicate that it was released by French government offices."

At least a dozen allied countries, including France, Japan, Italy, Taiwan and West Germany, have stepped up spying on U.S. businesses since the end of the Cold War, analysts say. These countries are particularly interested in electronics, defense and aerospace.

Secrets lost to allies "have cost American companies billions of dollars and have hurt U.S. competitiveness in the global marketplace," according to House Judiciary Chairman Jack Brooks, D-Texas.

But U.S. laws are so lax, and corporate victims so reluctant to bring charges, that there have been only two minor prosecutions for international industrial espionage.

France , which has coveted American technology since President Kennedy withheld details of the U.S. rocket program from Charles DeGaulle, is "at the top of the list," of allied spies, according to House Intelligence Committee Chairman Dan Glickman, D-Kan.

"The French are among a number of countries that plant moles in American companies, rifle the briefcases of visiting American businessmen and government officials, copy documents of interest to them and carry out classic espionage operations to gain industrial and economic intelligence," says former CIA director Robert Gates.

U.S. authorities repeatedly have warned French officials to stop, but "there have not been any dampers put on the effort," says a former senior U.S. intelligence official who maintains close ties with the government.

The memo listing espionage targets was unsigned, undated and stamped "Defense Confidential." It appears to date from mid-1989 or 1990.

The list rates U.S. technical and commercial targets from one to three. Top priority generally is given to U.S. companies competing against government-controlled French aerospace and defense firms.

Among the most coveted U.S. secrets:

-- Research, test results, production engineering and sales strategies for Boeing and McDonnell-Douglas. Both compete against the French-led European conglomerate Airbus Industrie.

-- Advanced helicopter research by Bell Helicopters, Sikorsky and Boeing, particularly on the tilt-rotor V-22 Osprey, which takes off like a helicopter and flies like an airplane. Ideal for Europe's short hops, the aircraft holds great appeal for French helicopter builders.

-- Advances in stealth technology at Lockheed, General Dynamics and McDonnell Douglas.

-- Propellant and guidance system breakthroughs at rocket-makers such as Rockwell International, Morton Thiokol and General Dynamics. Like Arianespace, a French-dominated rocket consortium, they make launchers for commercial satellites.

-- Optical and infrared sensors and advanced guidance systems for missiles and satellites. Ford Aerospace, Hughes, TRW, Lockheed, Kearfott, Itek Optical Systems and Aerojet General all compete against the French firms Aerospatiale and Alcatel-Thomson.

A senior official at another U.S. government agency confirmed that the French intelligence unit said to have prepared the list - the Department of Commerce, Science and Technology - was known to gather covert intelligence for French companies.

Both of the senior officials believe the list is authentic.

Several U.S. military intelligence specialists speculated that the list was a master plan to guide intelligence-gathering by French military attaches, defense executives and others.

While some of the information sought could be gleaned from trade journals, most would require covert efforts.

French defense and aerospace firms, struggling like their American competitors in a shrinking global market, differ in one key respect: They are largely owned and subsidized by the government.

That means spying for French industry is much the same as spying for the government. At least 12 of the 49 firms named on the spy list suspected they had been targeted by the French.

Some felt they had been spied on by French customers, colleagues or employees, representatives of the companies acknowledged. Others had lost proprietary documents in France under suspicious circumstances or had been warned of French wiretaps overseas.

French espionage objectives are less specific when it comes to spying on trade negotiators. Among high priorities are "instructions to American representatives for major international meetings and conferences." Advance knowledge is preferred, but trade negotiating instructions "are useful even after the meetings," according to the memo.

French and U.S. negotiators have clashed repeatedly at ongoing trade talks in Geneva, particularly over France's subsidies to its commercial aircraft industry and to French farmers. The spy document explicitly seeks background information about the U.S. side of those arguments.

Former U.S. Trade Representative Carla Hills said she worried about spies, even in friendly countries.

"We heard legions of reports of travelers who'd had the contents of their briefcases rifled, so we were very careful," Hills says. "You'd always take your briefcase to dinner."

Hills' name is high on the French spy list.

In addition, the U.S. Agriculture, Treasury and Commerce departments are all named as targets, as are the Securities and Exchange Commission and the Federal Reserve Bank. The list offers no clues to what was sought, however.

Former French spy chief Pierre Marion has claimed a leak from the U.S. Federal Reserve once enabled France's central bank to make millions by selling dollars in advance of a dollar devaluation.

Among commercial banks, investment houses and venture capital firms, the French mainly wanted the names of lawyers, consultants and financial organizations involved in European expansion plans or joint ventures.