Chalabi Reportedly Told Iran That U.S. Had Code: "American officials said that about six weeks ago, Mr. Chalabi told the Baghdad station chief of Iran's Ministry of Intelligence and Security that the United States was reading the communications traffic of the Iranian spy service, one of the most sophisticated in the Middle East.
According to American officials, the Iranian official in Baghdad, possibly not believing Mr. Chalabi's account, sent a cable to Tehran detailing his conversation with Mr. Chalabi, using the broken code. That encrypted cable, intercepted and read by the United States, tipped off American officials to the fact that Mr. Chalabi had betrayed the code-breaking operation, the American officials said. American officials reported that in the cable to Tehran, the Iranian official recounted how Mr. Chalabi had said that one of "them" — a reference to an American — had revealed the code-breaking operation, the officials said. The Iranian reported that Mr. Chalabi said the American was drunk. The Iranians sent what American intelligence regarded as a test message, which mentioned a cache of weapons inside Iraq, believing that if the code had been broken, United States military forces would be quickly dispatched to the specified site. But there was no such action.
The account of Mr. Chalabi's actions has been confirmed by several senior American officials, who said the leak contributed to the White House decision to break with him. .. [A new] F.B.I. investigation into the intelligence leak to Iran did not extend to any charges that Mr. Chalabi provided the United States with incorrect information, or any allegations of corruption. ..
The Bush administration, citing national security concerns, asked The New York Times and other news organizations not to publish details of the case. The Times agreed to hold off publication of some specific information ... The administration withdrew its request on Tuesday, saying information about the code-breaking was starting to appear in news accounts. .." 10:22:21 AM