Fake program allegedly routed gold bars through military contractor
David Rush, the Central Intelligence Agency official accused of stealing $40 million in gold bars from a covert program, has reached a tentative plea agreement with federal prosecutors that would resolve the case before he is formally indicted, according to a Friday court filing.
The filing, signed jointly by prosecutors and a lawyer for Rush, said the two sides had made “significant progress and have a plea agreement in principle.” Both sides said a resolution at this stage would help “conserve government resources” given the time-consuming burdens of dealing with classified information if the case moved toward trial. The filing provided no further details on the terms.
The FBI arrested Rush in May on charges of theft of public money after a search of his Virginia home uncovered more than 600 pounds of gold bars, north of $2 million in cash, and dozens of Rolexes and other luxury watches, the Wall Street Journal reported.
According to the Wall Street Journal, Rush held a rank the CIA’s equivalent of an army general and operated a highly classified intelligence program approved by Congress several years ago that uses large quantities of cash to obtain critical information about American adversaries. The FBI began probing him after the CIA referred allegations that he had filed false time cards. Separately, Rush had allegedly requested pay for time as a deployed Navy reservist when in reality he had left the military a decade earlier, authorities said.
Investigators later alleged that — separate from the real national security project — Rush had created a fake program and convinced two colleagues that it required tens of millions of dollars in funding through a contract, according to the Journal. The money was then transferred to a military contractor who provided the bars. Because the colleagues who were aware of the program were not permitted to discuss it with other employees or supervisors, Rush was able to move more than 300 two-pound gold bars to his home before anyone noticed, the Journal reported.
The Wall Street Journal also reported that Rush’s case has drawn concern among agency veterans that it risks revealing and compromising legitimate, highly classified operations.