Recon/Optical Industrial Theft

In 1986, security staff at a defense contractor in Barrington, Illinois caught three Israeli Air Force officers taking the company’s technical documents. When the company worked out how long it had been going on, the answer was more than a year, and the total came to roughly fifty thousand pages.

The officers were not intruders. They were supposed to be in the building.

The access

Recon/Optical, Inc. built airborne cameras and electro-optical reconnaissance systems, the equipment American military and intelligence agencies use for aerial surveillance. Under the U.S. Foreign Military Sales program, the company had a contract to develop a reconnaissance camera for the Israeli Air Force, and the arrangement gave Israeli technical representatives legitimate access to the facility to oversee the work.

That access is what the operation ran on. According to the arbitration findings, the officers spent more than a year systematically copying Recon’s proprietary technical documents and passing them to El Op Electro-Optics Industries, an Israeli defense firm in Rehovot that competed directly with Recon in the same airborne camera market.

So the company was paying to host representatives of a customer who were quietly transferring its designs to that customer’s domestic rival.

What happened to it

The case became public in August 1986, reported by both the New York Times and the Washington Post. The Israeli embassy denied that it was espionage at all and described the matter as a contract dispute.

There was no criminal prosecution. The dispute went to international arbitration instead, and the panel that reviewed the officers’ conduct found that it constituted “perfidious” illegal acts. That word is the tribunal’s, not this archive’s, and it carries a specific meaning: deliberate bad faith in the abuse of authorized access. Israel was ordered to pay Recon/Optical three million dollars.

William Owens, an executive at Recon, went to his Illinois congressional delegation asking for help recovering from what had been done to the company. Meaningful government intervention did not follow.

El Op kept the designs and kept competing with Recon in the same market, using technology it had not paid to develop.

Why it matters

Most espionage in this archive involves recruiting someone inside. This case did not require that. The collection was carried out by uniformed officers of a foreign air force, standing in an American defense plant, holding a badge that the American government had arranged for them.

The Foreign Military Sales program exists so that allies can oversee weapons being built for them with American approval. It assumes the people it admits are there for the stated purpose. Three officers were physically authorized to be exactly where they were, and what they did with that authorization was the offense.

The resolution follows the pattern. Three million dollars in civil damages, paid by a government, for the sustained theft of technology developed under Pentagon contract. No one was charged with anything. The officers were not named publicly, were not prosecuted, and did not answer for it in any American court.

Sources

• New York Times, “Illinois Company Charges Israel Tried to Gain Technology Secrets,” August 19, 1986
• Washington Post, “Firm Says Israel Tried to Steal Technical Secrets; Embassy Denies Charge Involving Reconnaissance Camera and Blames Contract Dispute,” August 20, 1986
• Duncan L. Clarke, “Israel’s Economic Espionage in the United States,” Journal of Palestine Studies, Vol. 27, No. 4 (Summer 1998), pp. 20–35 — citing Wall Street Journal reporting and National Center for Manufacturing Sciences documentation
• U.S. General Accounting Office, Defense Industrial Security — as referenced in Clarke’s sourced account