- NEW YORK (Reuters) - A classified Defense Department report has concluded
that scientists from Hughes Electronics Corp. and Loral Space & Communications
Ltd. turned over expertise to China that significantly improved the reliability
of China's nuclear missiles, the New York Times reported Monday.
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- The scientists from the two companies
turned over the information as part of their investigation of a Feb. 16,
1996, crash of a Chinese rocket that Loral had contracted for the launch
of a $200 million satellite, the Times said, citing unnamed officials.
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- In addition to identifying the cause
of the crash -- said to be an electrical flaw in the electronic flight-control
system -- the 200-page accident assessment also discussed other sensitive
aspects of the rocket's guidance and control systems, an area of weakness
in China's missile programs, the Times said. The May 1997 report concluded
that ``United States national security has been harmed.''
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- The report, whose existence has been
secret, prompted a criminal investigation of the companies, the Times reported,
citing unnamed officials.
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- The companies told the Times their employees
acted properly but they declined to discuss the matter.
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- Criminal charges are unlikely to be brought,
largely because the investigation was undermined this year when President
Clinton approved Loral's export to China of the same information about
guidance systems, the Times said.
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- Clinton acted despite strong opposition
from the Justice Department, which argued that approval would undercut
any criminal case, the Times said.
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- Loral chairman Bernard Schwartz was the
largest personal donor to the Democratic Party last year, the Times said.
The White House denied any political interference in the issue.
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