The FBI Releases Heavily Censored Files on Arnon Milchan

The name is Milchan,
Arnon Milchan.

Through a Freedom of Information Act (FOIA) appeal, the FBI released heavily censored files on Arnon Milchan, files that were not scheduled for release until 2036. None-the-less, these files are revealing as to the intensity of the FBI's focus on Mr. Milchan, including memos to the Director of the FBI, keeping him informed of developments in the case. These memos confirm numerous facts detailed in the book Confidential, including the US Attorney's attempt to "flip" Richard Kelly Smyth against Mr. Milchan, an attempt that failed. Smyth of course disappeared shortly thereafter. The sheer amount of material that was censored in these documents is testimony to the sensitivity placed on this entire matter, to this day. Here are a few of the FBI-Milchan files:

07/15/1992: Record of a phone call between a supervisory special agent on Los Angeles and special agent in Portland classified as "secret." The special agent notified LA of impending news media coverage of "an extremely successful movie producer in Hollywood" [Arnon Milchan] noting that his ties to "Oliver Stone, Sidney Pollack, Barbara Streisand, Tom Cruise, Richard Dreyfus and Robert DeNiro. The subjects likely location and wealth "close to $1 billion" and close to "Labor Party officials in Israel" [Particularly Shimon Peres] is noted. Milchan's arms dealing through MILCO and ties to another American are explored in the heavily redacted file.

07/15/1992: Phone call record continues. "On 8/9/1985, two weeks from the trial date of [Richard Kelly Smyth] the U.S. Department of Justice requested Israel to obtain a sworn statement from [redacted] on the same date, US Customs served a subpoena on [redacted] seeking all records of business dealings... On this same date [Smyth] disappeared and a few days later he failed to appear for a motion hearing. As a result his bail was revoked and a warrant was issued for his arrest. He is still a fugitive." Details on how an Air Force Scientific Advisory Board (SAB) member steered contracts to MILCO. SAB members that invested in and joined MILCO's board of directors. SAB member that worked as an atomic bomb designer at Lawrence Livermore and Los Alamos during the Manhattan Project. "Large volume of the Israeli business at MILCO and whether some of the equipment being sold was sensitive and related to nuclear weapons field."

7/15/1992..."At the time of [Smyth's] disappearance, the US did not have any reliable information that the Israelis were enriching uranium via uranium hexafloride. That information did not surface for another year until an individual named [redacted] detailed drawings and photographs of Dimona, Israel's nuclear research center, to the London Times."

"When they repeatedly asked if proper licenses had been obtained and, on 7/24/1982, they resigned. During January, 1983, MILCO's Huntington Beach offices were burglarized and [redacted] filed a report with the FBI. The FBI advised the US Customs Service of these activities, and during May, 1983, Customs realized that the 'tubes' were actually mentioned highly-restricted krytrons."

During December, 1984, a US Attorney [redacted] began a plea bargaining negotiations with [Smyth] regarding the illegal sales in efforts to get [Smyth] to provide the government with information regarding [Milchan's] illegal activities. These negotiations failed, and in May, 1984, Smyth was indicted on 30 counts of smuggling and making fase statements, based on 15 shipments of krytrons to Israel [Smyth faced the possibility of 105 years in prison]. Notes on individuals involved in Iran-Contra affair, disruption of Iraqi nuclear reactor through sabotage.

7/15/1992: [Redacted]

8/14/1992: Secret record of secure telephone call from special agent in charge of  Los Angeles field office to a special agent in Portland on 7/16/1992

8/17/1992: Record of a routine search on 8/17/1992.

2/25/1993: Priority message to the FBI Director and the Los Angeles office that "...during the later part of next week, during an NBC Nightly News broadcast, Tom Brokaw would reveal the background story of...MILCO". Of course, Brokaw and the FBI did not know half of what has since been reveal by the book Confidential, published years later.

3/29/1993: Message distribution to national and international offices. "The enclosed is for your information. If used in a future report, conceal all sources of paraphrase contents...This entire communication is classified SECRET. LA is requested to furnish a communication regarding the status of this pending matter to CI-2F Unit." (Confidential Informant).

4/23/1993: Message to FBI Director. "Enclosed for Los Angeles is one videotaped copy of two installments of NBC Nightly News that highlights some of the information that was provided to the Bureau and Los Angeles..."

11/30/1993: Message distribution to national and international offices. "The enclosed is for your information. If used in a future report, conceal all sources of paraphrase contents... This entire communication is classified SECRET. LA is advised to provide an appropriate UCFN for captioned matter," (Universal Case File Number).

06/05/1996: Open source news database information and "Who's Who in America, 1996" entry on smuggling case. "Case Agent [redacted] has requested that this matter be placed in a closed status at this time."
[Redacted pages]
news clipping, The New york Times, Saturday, May 1985 "Israelis Deny Knowing of Export Bar for Device Usable in A-Bomb", by Thomas Friedman. News clippings The Washington Post, May 15, 1985 "US Asks Israel to Account for Nuclear Timing Devices" by John M Goshko.

12/28/2011: FOIA release letter.