A former U.S. Army Sergeant, Joseph Daniel Schmidt, was arrested at San Francisco International airport following his arrival from Hong Kong and has been charged with the attempt to deliver national defense information and retention of national defense information. A grand jury indictment was issued on October 4 by the United States District Court for the Western District of Washington.
Joseph Daniel Schmidt
Court documents tell us that Schmidt served in the U.S. Army from January 2015 through January 2020. His active-duty assignment was to the 109th Military Intelligence Battalion located at Joint Base Lewis-McChord, located in Washington state where he was a Team Leader conducting HUMINT (human intelligence) operations. His role was to supervise the collection of HUMINT and produce intelligence analysis and disseminate intelligence product.
His team supported the Indo-Pacific Command. This Command covers the Pacific and Indian Ocean regions which includes China. His training included the bevy of HUMINT intelligence courses to include collection, management, and tradecraft. In addition, he attended the Defense Language Institute and received Chinese language training. As expected, Schmidt had access to classified information, up to and including Top Secret information. On December 17, 2019, just prior to his separation, he was “read out” on access to Special Compartmented Information (SCI).
Schmidt’s calculated effort to commit espionage
Schmidt isn’t the typical insider who as their time winds down they begin hoarding information for their use or profit following separation. During that 90-day window, so many in the insider risk management community point to, rather, his efforts may have begun in 2017. The court documents show that In November and December 2017, Schmidt traveled to China and had put in leave requests for two additional trips to China which did not materialize. On January 14, 2020, six days following his transition to inactive ready reserve status, he departed the U.S. to China and returned on January 18.
One may speculate that he attempted to make contact or make himself known by virtue of his visa application, which apparently identified himself as employed by the Department of Defense and occupation as “soldier.”
The court documents show us what appears to be the investigative results derived from the lawful search requests of Schmidt’s various online email accounts, to include multiple Gmail and Google accounts. It revealed Schmidt’s internet searches via his Google Chrome browser where he searched for countries which did not have extradition treaties with the United States; the location of the Chinese consulate in Istanbul, the Iranian consulate, visas to Pakistan and Afghanistan, information about the Chinese Ministry of State Security (MSS – China’s intelligence arm).
Not a month later, on February 9, 2020, Schmidt traveled to Istanbul, Turkey. After a couple of weeks in the city, he sends an email to the Chinese Consulate in Istanbul, on February 24, and which he unambiguously volunteers his services to the Chinese and asks for residency in China.
Hello,
My name is Joe Schmidt. I am a United States citizen looking to move to China. I currently reside in Istanbul and am trying to set up an appointment at the consulate in Istanbul.
I also am trying to share information I learned during my career as an interrogator with the Chinese government. I have a current top secret clearance and would like to talk to someone from the Government to share this information with you if that is possible.
My experience includes training in interrogation, running sources as a spy handler, surveillance detection, and other advanced psychological operation strategies. I would like to go over the details with you in person, if possible, as I am concerned with discussing this over email.
I’m sorry for using English, but I want to make sure that I do not miscommunicate. Please contact me at your earliest convenience if I can set up a time to meet with you.
Thank you,
Joe Schmidt
Then two days later, Schmidt creates a Word document, “Important Information to Share with Chinese Government” which is backed up to his Apple iCloud account and retrieved by investigators through a lawful request. A review of the document showed that it contained “a variety of classified information.”
Schmidt wasn’t done, and clearly not interested in keeping his interest in China discreet, he also reached out to the Chinese media outlets, “China Daily, People’s Daily, and Phoenix Television” asking if they were interested in him crafting freelance “military stories”
We don’t know if the Chinese ever responded to his email. What we do know is that while in Turkey, he queried Google Maps on how to get from Beijing’s airport to the headquarters of the MSS.
He departed Istanbul on March 2, and returned to the United States. He stayed in the U.S. long enough apparently to do his laundry and four days later, on March 6, he was again on a flight to Hong Kong and then onward to Beijing where he spent a few days. He was in Hong Kong from March 2020 and the court documents indicate he was hell bent on providing China classified information.
Off to China he goes
On March 10, an image in his iCloud account shows a screen shot of his location in relative proximity to the MSS headquarters. The next day he was again searching locations using Google and a variety of U.S. intelligence locations were researched, some of which Schmidt had been assigned during his period of service in the U.S. Army.
While in Hong Kong on March 16, 2020 he created another document, “High Level Secrets” which contained, high level secrets. This document was written in both Chinese and English, but again seems to indicate he is trying his darndest to get the attention of the MSS, as the 23-page document full of secrets began with two paragraphs where he again offers his services and identifies himself as a former “human intelligence collector.”
He included in this document his DD214, his Enlisted Record Brief (ERB), an image of his CAC, and a photo of his SIPR (classified network) token. Which clearly indicates to these jaded eyes that his interest in committing espionage was long in the making. A few days later, he photographs his Army PKI card (which he should have returned) which contains his encryption key to access classified networks, and his Army CAC, which allows physical access to buildings and entities. He took these copies and tried to engage with various Chinese state-owned enterprises (SOE).
He goes on to create more content – this time a 28-slide power point, “Use of Technology in Military Source Operations and Interrogations” and a drawing of “Mat V Computers.” Both were recovered from his iCloud account. Again, he attempts to share the information with another Chinese SOE.
On August 7, 2020, he was given a work permit from the PRC.
Discarded by China?
We don’t know what the circumstances present which propelled Schmidt to board a flight to San Francisco. It may have been that the MSS was tired of his presence perhaps having earmarked him early on as a possible provocateur or dangle from U.S. military counterintelligence; or the MSS may having determined he had no access to current intelligence; or perhaps Hong Kong immigration adjudicated his request for residency with a NO.
What we do know is his actions during his period of active duty apparently were not detected. His ability to retain his classified token and identity cards mystifies. The insider risk management regime did not, apparently detect his actions. The court documents identify his activities because Schmidt wasn’t the sharpest knife in the drawer and used accounts which were cloud based and accessible through lawful search requests. Where did the clue of his perfidy come from? Perhaps Turkish counterintelligence detected his attempts during his month in Istanbul to make contact and alerted the U.S. Perhaps this detail will come out should his case go to trial.
Schmidt’s shenanigans are over. This past week he returned to the United States and was arrested at San Francisco International airport and is being charged with the attempt to share classified information to China.
