Exporter Indicted in Illegal Shipment of Arms Devices

By RONALD J. OSTROW and BILL FARR

May 17, 1985 12 AM PT

Times Staff Writers

WASHINGTON — In a case with sensitive foreign policy implications, a federal grand jury in Los Angeles on Thursday indicted Richard Kelly Smyth of Huntington Beach on charges of illegally exporting to Israel devices that can be used to trigger atomic weapons.

From January, 1980, to mid-December, 1982, the indictment alleges, Smyth sent Israel as many as 800 of the devices, known as krytrons, without obtaining the required license or written approval from the State Department.

The indictment charges Smyth, owner of a small electronics company called Milco International, Inc., with 15 violations of the Arms Export Control Act and 15 counts of making false statements to the government.

“There is no Israeli government involvement in this,” a spokesman for the Israeli Embassy here said. “We have received the units, and they are used in defense-related research and development for conventional weapons only.”

The embassy spokesman declined to comment on whether Israel knew the shipments were illegal.

Smyth, who left for Europe with his family last weekend, could not be reached. James Riddet of Santa Ana, his attorney, said: “There is no question that Smyth shipped the devices, but he did not believe that a special license was required. . . . He did not know they could be used as atomic triggering devices.”

Riddet said Smyth will return to Los Angeles for a May 28 arraignment on the charges.

A State Department spokesman said the United States has expressed to Israel its “serious concern” about the alleged violation of U.S. law and has received Israel’s assurance that it will cooperate in the investigation “to the full extent permitted under Israeli law.”

Israel agreed to a U.S. request to return the krytrons remaining in stock, the spokesman said. The Israelis did not know how many krytrons, which can be used for conventional military ordnance, lasers and radar as well as for atomic devices, will be returned, he said.

Robert C. Bonner, the U.S. attorney in Los Angeles, said the indictment resulted from a two-year investigation by the Customs Service under its “Operation Exodus” program, an effort to stem the flow of military and high-technology materials out of the United States.

In shipping the krytrons, Smyth sometimes made a “shipper’s export declaration” that the devices were “G-Dest,” a designation for routine “general destination” items that do not require licenses or State Department approval, according to the indictment. On other occasions, the grand jury charged, Smyth stated that the materials were “diodes, triodes and pentodes” rather than krytrons.

If convicted, Smyth could be sentenced to as much as two years in prison and fined $100,000 for each of the 15 Arms Export Control Act violations. He could also be sentenced to up to five years in prison and fined $10,000 for each of the 15 false statement counts.

As for any Israeli government involvement, the department spokesman noted that the charges do not “cover any Israeli citizen or company.” He said he could not explain how Israel could fail to recognize that the krytrons were being shipped without the required U.S. permission when there were no licenses attached to the shipments.

In Los Angeles, Asst. U.S. Atty. William Fahey, who presented the case to the grand jury, would only say that “the investigation is continuing” when asked if there was the possibility of an indictment being returned against Israeli businessman Arnan Milchan, who worked with Milco to obtain the krytrons. The Huntington Beach firm purchased the krytrons from EG&G;, Inc., a Massachusetts firm that is the sole manufacturer of the devices.

Alan Walls, the Customs Service’s chief agent in Los Angeles, said the wholesale cost of the krytrons is “between $60 and $75 per device.”

Fahey confirmed that the tiny devices, which are inch-long tubes from which four thin wires extend, were shipped from Milco to the Heli Corp., which he described as a company in Tel Aviv controlled by Milchan.

Milchan also has been active in the film industry and has produced several Hollywood movies, including the “King of Comedy,” starring Robert De Nero and Jerry Lewis.

Gretel Siler, Smyth’s daughter and corporate treasurer of Milco, said Milchan was not one of the owners of the company but had an arrangement calling for him and the firm to share in profits from export sales he arranged. California Department of Corporations records show that Milco is a “closely held” corporation with Smyth, three family members and four friends as the stockholders. Among the non-family stockholders is Orange County Municipal Judge Brian R. Carter.

Ronald Ostrow reported from Washington and Bill Farr from Los Angeles. Contributing to the article was Jane Applegate in Orange County.