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Spokane, Washington  Est. May 19, 1883

How prosecutors say a top FBI agent sold his services overseas

By Michael Rothfeld, William K. Rashbaum and Kenneth P. Vogel New York Times

When Charles McGonigal, a former counterintelligence chief with the FBI, was accused of using his position to benefit an associate’s business in Eastern Europe, it represented a startling turn for a high-ranking official who had been entrusted with access to some of the most sensitive secrets held by the U.S. intelligence community.

But it also set off a scramble within the bureau to assess the potential damage and determine whether any counterintelligence or law enforcement operations were compromised, according to two people familiar with the review, with the FBI’s director, Christopher Wray, treating the case as a top priority.

“It puts a question mark next to everything he was involved in,” said Holden Triplett, a former FBI counterintelligence official who left in 2020 and co-founded Trenchcoat Advisors, a risk management consultancy.

“You’d be trying to figure out, ‘OK, when did this start, and what did he touch after it started?’ ” said Triplett, who does not have direct knowledge about the review of McGonigal’s career. “Going back and thinking about what the damage could be is painful.”

Inside the FBI, where he spent 22 years, McGonigal was so trusted that he was tapped to run the investigation into a devastating breach that led to the imprisonment, execution or disappearance of more than a dozen CIA informants in China, one of the FBI’s most sensitive assignments.

The episodes described in a pair of indictments unsealed last week by federal prosecutors in Washington and New York paint McGonigal, 54, as aggressively entrepreneurial in seeking to generate business through the contacts and power his position afforded him, operating almost in plain sight without being detected despite the danger that someone with his knowledge could pose if corrupted.

While still at the FBI, he developed a relationship with Prime Minister Edi Rama of Albania and took steps to benefit the politician, according to the prosecutors in Washington. Rama has portrayed himself as a reformer and as opposed to Russia’s war in Ukraine. But after his 2018 retirement, McGonigal worked the other side, on the payroll of a sanctioned Russian oligarch, Oleg Deripaska, once seen as a member of President Vladimir Putin’s inner circle, according to the indictment of McGonigal and another man, Sergey Shestakov, in New York.

A spokesperson for the FBI’s New York office declined to comment.

An attorney for McGonigal, Seth DuCharme, did not respond to a request for comment. But after last week’s indictments, he said McGonigal had “served the United States capably, effectively, for decades” and that his legal team looked forward to reviewing the government’s evidence.

The earliest crimes of which McGonigal is accused date to August 2017, but the FBI’s damage assessment likely is looking back much further, former officials said. That he may have lied while with the bureau about his acceptance of cash from a business associate and contacts with foreign individuals has also raised concerns about the breadth and duration of his possible deceptions.

McGonigal retired from the FBI in 2018 as the special agent in charge of counterintelligence in New York, reporting to the field office’s director. Counterintelligence, which in the FBI focuses on identifying and rooting out foreign intelligence gathering on U.S. soil, is particularly crucial in New York, where the presence of the United Nations and numerous diplomatic missions present ample covers for would-be spies.

McGonigal’s high-ranking role would have given him a wide view of what was happening across the agency and intelligence community, and involvement in strategic decisions like where to point squads of ground-level special agents, former officials said. It would not generally require extensive international travel, involve meeting with heads of state or entail direct involvement in ongoing investigations, all of which McGonigal is accused of doing.

“You’re talking about four levels above the actual investigators,” said Clayt Lemme, a former FBI official who oversaw counterintelligence at the bureau’s Washington office. “Under normal circumstances, he wouldn’t be involved in the day-to-day decision of opening a case or closing a case.”

McGonigal’s willingness to meet with the head of state in Albania, a country that has an American diplomatic presence, suggests he was not keeping his involvement there a secret from colleagues, former officials said. He also used his FBI email address and phone for Albania-related matters, a person with insight into the investigation said.

But whatever official pretext McGonigal might have for those trips and associations could also have served as a cover for more questionable activities, others said.

That the suspected crimes occurred shortly before his retirement suggests McGonigal might have started or increased illicit activities after taking the last of his required polygraph tests, which are supposed to be administered every five years. Triplett said the betrayal of the agency by someone of McGonigal’s stature for $225,000, if proved, would be surprising given that former officials can earn significant sums as consultants after retirement, on top of hefty pensions.

But it would not be unprecedented. Robert Hannsen, the FBI agent turned spy who fed classified information to Russia for two decades and is serving a life sentence, began cooperating with the Russians in the late 1970s while in a counterintelligence unit in New York.

The Washington indictment details how, over two years, McGonigal submitted false financial disclosures to the FBI. The forms omitted his acceptance of payment from a New Jersey businessperson who was a former employee of an Albanian intelligence agency as well as free international travel. Prosecutors said McGonigal also lied about his travel destinations and interactions with foreigners on forms he was required to complete and took actions that appear to have conflicted with his government duties.

In August 2017, prosecutors said, he met with Agron Neza, the New Jersey businessperson prosecutors described in the Washington indictment as Person A. Other than Deripaska, the people mentioned in the indictments of McGonigal were not named. The New York Times identified them through public records and interviews with people familiar with the case. Some were also listed in a portion of a federal subpoena from the investigation of McGonigal that was published by Insider, an online publication, last year.

Neza, 59, was born in Albania and employed by an intelligence agency there several decades ago, prosecutors said. He later moved to the United States, settled in northern New Jersey and became an American citizen. He has not been accused of any wrongdoing.

At the August 2017 meeting, McGonigal asked Neza for money, prosecutors said. They did not detail how the men met, characterize their relationship or reveal the reason for the request. But in the New York indictment, Neza is referenced as McGonigal’s friend. In the months after McGonigal asked for money, the men made multiple trips to Europe, where McGonigal seemingly used his position in efforts to generate business for Neza, prosecutors suggested in the Washington indictment.

In September 2017, the men traveled to Albania, prosecutors said, where Neza introduced McGonigal to Dorian Ducka, a former Albanian official serving as an informal adviser to the prime minister, Rama. Ducka, described in the Washington indictment as Person B, brought McGonigal to see Rama. Neither Neza nor Ducka could be reached for comment.

Along with giving Rama FBI paraphernalia, McGonigal appears to have tried to sway the prime minister toward awarding an oil-drilling license to an entity affiliated with Neza and Ducka, prosecutors suggested.

McGonigal also seemed to try to aid Neza in making deals with an Albanian politician and businessperson who wanted the FBI to investigate what he said was a plot on his life, the Washington indictment says.

After meeting the man, McGonigal arranged on a subsequent overseas trip for a U.S. prosecutor to interview him in Austria, using Neza as his interpreter. Prosecutors suggested the meeting was a sham; there was no official record of the interview, and Neza was not paid for the work. On the same day, McGonigal and Neza flew to Albania, where they met the politician and discussed business opportunities, the indictment said.

That fall, Neza gave McGonigal $225,000 in cash in three installments, according to the indictment. Neza made one of the payments inside a parked car in New York City and the others at his home in New Jersey, prosecutors said. McGonigal promised to pay the money back, according to the indictment. Prosecutors have not charged McGonigal with taking any official action in exchange for the payments.

In November, after McGonigal again met with the prime minister and Ducka in Albania, he contacted the same prosecutor who had been with him in Austria about a potential investigation into a lobbyist that Rama’s political opponent had hired to gain access to and support from President Donald Trump.

The events detailed in the indictment and other public records seem to match the description of lobbyist Nicolas Muzin.

Only days before McGonigal contacted the prosecutor, on Nov. 14, Muzin filed a report with the Justice Department disclosing his lobbying for the Democratic Party of Albania, the center-right political party challenging Rama. The party was headed by Lulzim Basha, who had cast himself as a backer of Trump.

Through early 2018, Neza continued to pass along information – some of which came directly from Rama’s office – about Muzin to McGonigal, according to the Washington indictment. McGonigal would then forward the information to others in the FBI office in New York.

In late February, the FBI formally opened an investigation into the lobbyist “at defendant McGonigal’s request and upon his guidance,” according to the indictment. Neza was among the confidential sources who provided information during the investigation, and Ducka paid for witnesses in Europe to travel to a meeting with the FBI, the indictment says.

Throughout, McGonigal failed to disclose his contacts with Ducka or his financial relationship with Neza, prosecutors said. It was not clear if the Justice Department took additional steps to investigate Muzin, and no charges have been brought against him. Muzin said in a statement that he had “no reason to believe that I was the victim of this false investigation. But if I was, that is unfortunate, and I hope that justice will be served.”

In his final months at the FBI, McGonigal made at least one more effort to use his influence in an apparent attempt to help Neza, according to the Washington indictment. He met in Germany in April 2018 with two men from Bosnia and Herzegovina, prosecutors said, one of whom, described in the indictment as Person C, was an adviser to a senior Bosnian elected official. The other, Person D, had founded a pharmaceutical company.

The men asked McGonigal to help them meet with the U.S. ambassador to the United Nations or another diplomat to discuss receiving American support on a political issue not specified in the indictment. McGonigal proposed to Neza that he negotiate a contract to be paid $500,000 by the pharmaceutical company in exchange for the diplomatic meeting; in a message, he asked Neza to “protect” his name while trying to make the deal, according to the indictment.

The men went forward with the plan, and McGonigal tried to arrange the diplomatic meeting, the indictment says. It does not indicate whether the contract was executed, the payment made or the meeting held.

After leaving the FBI, McGonigal went to work for Deripaska, the sanctioned oligarch, according to the New York indictment. But it was not his first encounter with Deripaska’s circle.

Prosecutors suggested that McGonigal began wooing Deripaska shortly before his retirement. In 2018, he helped the daughter of an employee of Deripaska get an internship with the New York Police Department, according to the New York indictment. McGonigal explained to another FBI official that the girl’s father was a Russian intelligence officer he wanted to recruit, prosecutors said.

In 2019, after his retirement, McGonigal introduced Deripaska to a law firm that would seek to get his sanctions lifted, and McGonigal was paid $25,000 a month through March 2020 by Deripaska through the law firm as a consultant, according to the indictment. The work stopped at the beginning of the coronavirus pandemic.

In 2021, McGonigal and his associate, Shestakov, negotiated a deal – with the Deripaska employee whose daughter got the police internship – to work for Deripaska to investigate a rival oligarch.

McGonigal and Shestakov, who are charged with violating U.S. sanctions and money laundering, were paid $218,000 over three months from a shell company in Cyprus through a Russian bank, the indictment says. McGonigal arranged to receive payments through a friend’s company in New Jersey, forging the friend’s signature on a contract, prosecutors said.

That friend was Neza, according to a person familiar with the investigation.

But McGonigal’s friend was apparently not aware of his work for Deripaska. When Neza asked about the source of the wire transfers from a Russian bank, prosecutors said, McGonigal replied that he had done some “legitimate” work for “a rich Russian guy.”

Neza agreed to transfer the money, prosecutors said.

This article originally appeared in The New York Times.