Missile Misdeal

[May 16th, 2007]

Think of a typical arms dealer, and you might picture Nicolas Cage's character in Lord of War—calm, calculating and completely amoral.

Rob Caldwell couldn't be further from Cage's image in that 2005 film. He's a fidgety motormouth. He plays guitar in a Christian rock band. He cried about the death of liberal columnist Molly Ivins in a recent WW interview. He's about the last person you'd trust to keep cool shipping illegal weapons.

One more thing: He tells WW, in his first comments to the media, that he didn't do it.

But federal agents have a different view of the 57-year-old Portlander. They say he conspired with a shadowy international business group to export batteries used to power Hawk surface-to-air missiles from Texas to Europe, where they were to be resold to Iran.

Caldwell's trial in U.S. District Court in El Paso starts June 11, about four months after Homeland Security agents burst into a hotel room in San Antonio where Caldwell had just bought five missile batteries for a total of $5,000 to sell overseas. He's charged with two counts of conspiring to export defense articles without a license. If convicted of both counts, he could face up to 15 years in prison.

Caldwell says he believed the box-shaped, foot-long batteries were meant for boats serving North Sea oil rigs. And he says federal agents used him to build up a bigger arms-dealing conspiracy to bust.

"Homeland Security operates on the margins of the law," Caldwell says. "I was unsuspecting, naive, and was an easy target to snare."

Gregory McDonald, an assistant U.S. attorney in El Paso prosecuting the case, declined comment except to suggest that tapes of Caldwell's phone conversations with an undercover agent cast considerable doubt on his claims of innocence. Neither side would release the tapes before trial.

Caldwell describes himself as a businessman who imports chemicals for fertilizer. A background check shows he was a registered import agent for chemical companies in California and New Jersey. His former boss at LidoChem Inc. in Hazlet, N.J., describes Caldwell as "a good guy."

Married with two grown children, Caldwell moved to Portland from San Francisco seven years ago. Now self-employed, he works as an importer and sales agent for foreign chemical companies. An official with one of them, Mitsuya Boeki Ltd. in Osaka, Japan, told WW that Caldwell helped boost their U.S. sales.

Aside from a speeding ticket in 2001, a parking ticket and a citation for driving a pickup that spewed smoke, Caldwell has no criminal record.

But all that could change, thanks to a call Caldwell got on Dec. 18 from London. Caldwell says Christopher Tappin, a British businessman he used to buy chemicals from, told him he needed help importing boat batteries from the United States. Caldwell agreed, though he says he knew nothing about batteries and had never exported anything.

What Caldwell didn't know was that agents from U.S. Immigration and Customs Enforcement, under the Department of Homeland Security, were already on to Tappin as part of a complex investigation.

On Aug. 10, 2006, ICE agents in New York City arrested the unidentified owner of a company in Cyprus who tried to buy Hawk missile batteries illegally from a Homeland Security front company.

According to an affidavit filed by ICE in U.S. District Court in El Paso, the Cyprus business owner agreed to cooperate with the feds. He stayed in touch with his partner, Tappin, to arrange the deal while federal agents monitored their phone calls and emails.

An undercover ICE agent, posing as a U.S. businessman, agreed to sell Tappin five batteries. But he told Tappin his company was in trouble with U.S. customs and couldn't export them. According to the affidavit, Tappin said he knew someone who could—Caldwell.

After getting the Dec. 18 call from Tappin, Caldwell called the undercover ICE agent two days later. The agent is not identified in the affidavit, but Caldwell says he knew him as Jason Miller of Mercury Global Enterprises in El Paso.

The company, which Caldwell says is a Homeland Security front, says on its website it "provides the latest in advanced technology." Calls from WW to the phone number on the site were routed to a voicemail system under a different number and were not returned. Emails also went unanswered.

According to the affidavit, Caldwell told the agent he knew the batteries were "sensitive" and that "everything has to be done very businesslike." He went to San Antonio on Jan. 24 to meet the agent, buy the batteries and take them to his freight forwarder in Houston for export to Tappin in Britain.

Caldwell told WW he knew he needed an export license, but Tappin assured him it was a mixup and Miller would work it out. When federal agents arrested him at the hotel, Caldwell told them he knew exporting the batteries without a license was illegal, but he didn't know the penalty.

Caldwell stood to make $500 from the deal. He says he did the deal for the piddling amount because he thought it would lead to more business with Tappin. Instead, he spent a week in a San Antonio jail and was released Feb. 3 on $50,000 bail.

Prosecutors offered a softer sentence if he pleaded guilty. Caldwell says he told them to "eat shit and die."

His El Paso attorney, Louis Lopez, says he'll argue at trial Caldwell was a victim of entrapment.

"If they had been straightforward from day one and said these are missile batteries going to Iran, Mr. Caldwell would have said go jump in a lake," Lopez says. "When it came to Mr. Caldwell, everyone played hide the ball."

Meanwhile, Caldwell says the case has hurt his business and left his family humiliated. Neighbors in his Northwest Portland apartment complex think he's a terrorist. "I'm just freaked out and scared,'' he says. "This has changed our lives forever."