Fallout From The Scandal

When Secretary of State George Shultz phoned President Reagan from Moscow last week, he was forced to make his call from a special communications van flown over from the U.S. In the wake of the charges that Marine guards had allowed KGB agents into the embassy, his cables to Washington were dispatched through a communications system that had been elaborately reworked to safeguard their encryption. American security experts took exceptional pains to ensure that the Secretary's sensitive communications were not intercepted by hidden Soviet listening and decoding devices. Although arms-control issues dominated the Secretary's visit, the sex-for-secrets controversy continued to cast a shadow over U.S.-Soviet relations: on Ronald Reagan's instructions, Shultz led off the negotiations with a complaint about espionage.

The Secretary also toured the still unfinished chancery at the site of the new U.S. embassy and later told Western and Soviet correspondents, "We now find we have a honeycomb of listening devices" in the building's walls and structural columns. Investigators, however, have had only mixed success in locating bugs. They discovered reinforcing rods in five pillars that were apparently designed to serve as antennas. But after ripping into one wall with pneumatic drills in search of a suspicious object, workers found nothing more ominous than an empty beer can embedded in the concrete.

So far, more than 600 soldiers and civilian U.S. officials have been interrogated in a worldwide investigation of embassy security. Marine Commandant P.X. Kelley has endorsed an internal Corps memorandum suggesting that the Justice Department assist the Navy in its probe. The memo's rationale is that American civilians will soon by implicated and that military investigators are overburdened by the scope of the scandal. Three Marine guards have been charged with espionage and one with fraternizing with Soviet women. Another Leatherneck suspected of spying has been recalled from his station in Brazil, where he was living with a Russian woman he met during a tour of duty at the Moscow embassy; he is currently being held at the Marine base in Quantico, Va. As a result of such discoveries, the State Department has replaced five possibly tainted communications centers: in Moscow, Leningrad, Brasilia and two in Vienna, where the embassy was compromised twice by different Marine guards. The new units cost $5 million each.

The Navy last week was having difficulty preparing cases against Sergeant Clayton Lonetree and Corporal Arnold Bracy, the two Marines whose confessions triggered the scandal. The embassy guards have apparently repudiated or contradicted key sections of their initial statements, and much of the investigators' case against them rests on hearsay evidence and polygraph tests.

After two days of a pretrial hearing at Quantico to determine whether Lonetree should undergo a court-martial, the defendant's lawyers won a 3 1/2- week postponement of the proceedings. As Lonetree emerged from the courtroom, he grinned broadly and gave the thumbs-up sign, an indication that a plea bargain may be in the works. Lonetree's chief attorney, William Kunstler, claimed the prosecution's witnesses "said nothing that hurt our client." Added Kunstler: "They have no direct evidence that ties or links him to any illegal activity."