Nuclear Black Markets:
Written Testimony by David Albright,
Institute for Science and International
Security (
Before the House Committee on Foreign
Affairs’ Subcommittee on the Middle East and
Abdul Qadeer Khan was finally busted in 2004 after he had
done a great deal of damage to
Khan’s arrest and confession ended a career in nuclear
smuggling that lasted more than 30 years.
For most of this time, Khan outfoxed Western intelligence agencies and
governments in his effort to secure nuclear weapons for
At home, he was a much decorated national hero, receiving
most of the public credit for
Despite his arrest, shutting down the Khan network has by no
means brought a halt to nuclear smuggling, even by
Ambassador Abdul Minty, Deputy Director General of the South
African Department of Foreign Affairs, has said that the Khan network operated
in 30-40 countries, but few of these affected countries have launched any
prosecutions of members of the network.
Only a handful of Khan’s associates were even arrested. As an early opponent of the apartheid regime
in the mid-1970s, Minty was one of the first to wage a campaign against
Illicit nuclear trade is the scourge at the heart of
virtually all efforts by would-be and several defacto nuclear weapons states to build or expand their nuclear
arsenals. We must fear
Despite the seriousness of illicit nuclear trade, it is
receiving scant attention in the wake of the Khan network’s exposure. Where significant resources have been brought
to address the threat of fissile material smuggling in the former
The Development of Illicit Nuclear Trade
Back in the early 1970s, Khan was the first to realize that the means to make nuclear weapons could be purchased piecemeal from Western suppliers. He once joked arrogantly in an on-camera interview with a German journalist, “If a supplier refuses to deliver me equipment I need, I ask my friend Tom, and he will get it for me.”[2] Khan understood that through reverse engineering and duplication, he could build himself an entire uranium enrichment facility one piece of centrifuge at a time instead of buying a plant in its entirety.
Khan’s accomplices did not come from outlaw states, and were not terrorists. They were engineers--his European university chums—or ambitious businessmen out to get rich quick. Urbane and educated, they stashed millions of dollars in secret bank accounts and in some cases handed down the family business to their children. They also drove the business by always being on the lookout for promising new markets.
With his pioneering methods in the late 1970s, he succeeded
in getting
After Khan paved the way in the late 1970s and early 1980s, many countries followed his path. Iraq, Iran, North Korea, Brazil, India, and South Africa all encountered difficulty buying complete nuclear facilities, and thus systematically pursued the illicit route to acquiring high-tech items for their nuclear weapons programs from Western suppliers, many of whom were all too willing to help for a large profit.
The process of illicitly obtaining a clandestine nuclear
facility piece-by-piece typically requires a sophisticated procurement
network. Based on a series of case
studies developed at
- Developing a national illicit procurement infrastructure that can organize and obtain the necessary items for a secret nuclear weapons program;
- Recruiting or connecting with key foreign players that can sell both legal and illicit items, or can act as agents or trusted sources of critical technology. Such recruitment efforts have involved off-shore agents or companies, middlemen, or nuclear experts, and partial or complete control of foreign companies;
- Acquiring specialized know-how;
- Gaining the necessary education and training of program personnel;
- Developing secret logistics, including banking and financial transfers and transportation;
- Keeping secret the procurement efforts and the construction of the nuclear facilities;
- Exploiting weaknesses and loopholes of national export control regulations and laws. Supplier nations too often have weak laws or create loopholes in the laws, and there can be weak coordination within governments to reduce the threat of illicit nuclear trade; and
- Mastering the creation of false end-user statements.
Khan’s
Unprecedented Transnational Illicit Supply Organization
Always the pioneer, Khan charted a new pathway to nuclear
proliferation in the mid-1980s. He
started to sell centrifuges and nuclear weapon designs to other developing
countries with nuclear ambitions, starting with
Khan’s success can be traced to his creation of
international manufacturing and smuggling operations, always seeking
businessmen eager to make money and countries with weak export controls. For example, the Khan network organized the
acquisition of machine tools in Europe and their shipment to Malaysia for use
in making centrifuge components, which were exported to Dubai and then to
Libya. Agents of the Khan network
arranged for a centrifuge subcomponent to be made by an unsuspecting company in
One of Khan’s most dangerous innovations was his ingenious marketing of sensitive nuclear equipment, materials, and detailed designs and manufacturing instruction booklets. According to a senior IAEA official, Khan developed packages containing key equipment and documentation, often digitized, sufficient to achieve one step in the process of building a nuclear weapon. The packages were offered to prospective customers, who could pick a few or all of them, maximizing Khan’s profits and efficiency. However, these packages remain a proliferation threat. It is unknown who has them and who may use them in the future to build nuclear weapons. Although the danger that such detailed designs would emerge on the internet has not been realized, a greater, largely unnoticed danger may have already come to pass. Digitized information critical to developing a nuclear weapon program may be in the hands of unknown smugglers who ironically would jealously protect this information so that they can sell them for maximum profit, possibly to our enemies.
The Khan network has highlighted the danger posed by
transnational nuclear smuggling rings to
Current
Situation
Some
countries, such as
Nuclear smuggling has developed into a sophisticated operation over the last 30 years. It involves phony front companies, ingenious marketing strategies, and a continuous search for loopholes in laws prohibiting or controlling the export of sensitive technology to other states. Such “tricks of the trade” help nuclear smugglers avoid detection, maintain their flow of revenue and, not coincidently, make the world a far more dangerous place in which to live.
Smugglers continue to corrupt seemingly incorruptible businessmen, particularly in developing countries where governments are unable to monitor or control their activities. Illegal businesses can be hidden inside legitimate ones and the enormous growth of global trade provides the perfect cover to hide the black market’s transnational transactions.
Some of the current methods of illicit procurement include:
- Front companies or state procurement agencies falsely acting as a private company to get around other countries’ laws or regulations banning the sale of direct or dual use nuclear items to a proliferant state’s secret nuclear or military programs;
- Domestic and overseas trading companies;
- Ostensibly legitimate suppliers, increasingly located in developing countries, that provide dual-use items and function as buying agents of other items for the proliferant state; and
- Transnational, illicit brokers, which specialize in acquiring and selling sensitive equipment through circuitous routes to proliferant states’ military and nuclear programs.
Easing the task of illicit procurement is that technology continues to improve and spread throughout the world, making it easier to obtain the materials, equipment and know-how to make nuclear weapons. More countries, many of which are still considered developing nations, have sophisticated manufacturing and machine tool capabilities that can be exploited to make items for nuclear weapons. In addition, detailed classified information about nuclear weapons and how to make them continues to leak. Sensitive information has spread to shady entrepreneurs determined to make a profit. Experts with experience in producing fissile material and nuclear weapons are now spread throughout the world, potentially providing a pool of expertise for terrorist efforts to build nuclear weapons. New technologies could also emerge that would simplify the task of making fissile material or producing nuclear weapons.
John M. McConnell, Director National Intelligence, testified
before the Senate Armed Service Committee on
“We are watching several states for signs of nuclear weapons aspirations, in part because of reporting of past contact with A. Q. Khan and his network when it was active. We also are concerned about rogue or criminal elements willing to supply materials and technology--alone or with a network-- without their government's knowledge.”
There is a growing danger that terrorist groups will soon be
able to build their own atomic bombs. A secret
Khan demonstrated that it is possible for a shady network of scientists, industrialists, and businessmen to sell turn-key nuclear weapons production facilities. An undeveloped country could save years in its quest for nuclear weapons. In the future, hostile groups in failed states could buy the facilities to make nuclear explosive material and fashion a crude atomic bomb. According to Tenet, “In the current marketplace, if you have a hundred million dollars, you can be your own nuclear power.”[5]
Policy Challenges and Recommendations
The following is a summary of several of the major challenges governments and international organizations face in addressing illicit trade:
PSI is not a panacea: The Bush Administration has placed too much reliance on the Proliferation Security Initiative (PSI). Lack of actionable intelligence has severely undercut the usefulness of the PSI. International legal problems in intercepting ships on the high seas also inhibit its practical application. For example, the UN Security Council resolution on North Korea highlighted the risk of a military confrontation breaking out if a North Korean ship is intercepted by the U.S. Navy, undermining support for one of the main stated rationales of PSI.
Illicit nuclear trade
is pervasive: Governments and
publics have been unable or unwilling to recognize the pervasiveness of illicit
nuclear trade. Illicit trade is
conducted by
Prosecutorial Ineffectiveness: National prosecutions have been reluctant to work together to bring individuals to justice that are part of transnational smuggling rings. International cooperation among prosecutors and law enforcement officials is critical in investigating illicit trade, developing evidence, and convicting smugglers. Yet, the prosecutions of key figures of the Khan network have shown that such cooperation occurs far too infrequently. Remarkably, illegally helping outfit a nation with nuclear weapons is not treated as a crime against humanity, even though the outcome could be the slaughter of hundreds of thousands of innocent people in a nuclear explosion.
Need to strengthen the first line of defense--the private sector: Companies are the first line of defense against nuclear smuggling. Yet, many companies are not doing enough to thwart such sales or alert authorities about suspicious trade. The ethic of greed rather than non-proliferation remains dominant in most companies. In addition, governments and their intelligence agencies need to cooperate more with businesses in figuring out and thwarting the elaborate strategies of smugglers to obtain nuclear and nuclear-related goods.
UNSC Resolution 1540 is poorly implemented: UN Security Council Resolution 1540 is an important resolution that has created a requirement for all countries to create export control laws. However, the export control requirements in the resolution remain poorly implemented.
Loopholes in Export Controls: Generic problems, such as uneven application and poor enforcement, undermine the effectiveness of national and international export controls, particularly “catch-all” clauses. Current export controls have a major loophole that allows trading companies to buy many dual-use items from legitimate suppliers using a false but believable end-use. Then, without the knowledge of the suppliers, these companies send the items either directly or increasingly through other trading companies to secret nuclear programs. Few companies have the resources or desire to check all these trading companies. Even fewer are willing to take the step of banning all commerce with trading companies, probably the only step that can plug this loophole under existing national and international arrangements.
Need to control
sensitive information better:
Countries control sensitive nuclear information differently. Highlighting this concern, we at ISIS saw
first hand the inadvertent leakage of sensitive gas centrifuge design
information from India that would be far better protected in Europe and the
United States. There is a need to reach
an international agreement with key countries about the exact information that needs
to be kept secret and the level and type of protection this information
requires. In addition, the
Lack of empowerment
of the IAEA: The IAEA needs a mandate
to track illicit nuclear trade. Because
of its investigations of
Conclusion
The arrest of Khan and his lieutenants should have been a call to arms. Instead, the response has been tepid and is in disarray. Ambassador Minty worries that the lack of action against members of the Khan network shows a lack of commitment to stopping the spread of nuclear weapons. Since the Khan network was exposed, a number of reforms have taken place. But these steps have not confronted the root of the problem. Illicit nuclear trade remains the well-trodden path to nuclear weapons for both today’s enemies and allies. Yet, few are even aware that this problem exists, let alone committed to solving it.
Figure 1 A Simplified Khan Network
Pathway: Based on DRAFT
