The Case Against Nada Prouty

Nada Prouty's identity was once a closely held national secret. She was an FBI agent, then a CIA officer with top security clearances who penetrated terrorist organizations overseas. Her fellow CIA officers say she risked her life often, volunteering for dangerous missions. And because she's originally from Lebanon, she speaks native Arabic, a rare skill for an American intelligence officer.

But Prouty's daring career was destroyed. In those years after 9/11 when rooting out terrorists at home was an obsession at the Justice Department, federal prosecutors launched investigations and even Prouty was accused of supporting terrorism. Was a traitor exposed? Or did America lose a patriot?

Now, former undercover CIA officer Nada Prouty steps out from the shadows to tell her story for the first time.

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"I love the country. I believe in the country. I believe in everything that this country stands for," Prouty told "60 Minutes" correspondent Scott Pelley.

She acknowledged this was dangerous work. "I embraced the mission. The mission became my family. The mission became my life. And I would have given anything to protect the mission."

Prouty's missions for the FBI and CIA read like a history of America's fight against terrorism. She investigated the bombing of the U.S.S. Cole, the attack on Americans at Khobar Towers in Saudi Arabia, and, in Pakistan, she interrogated a terrorist who killed 20 people on a Pan Am plane and got him to confess.

"Nothing prepares you to meet a terrorist, a real-life terrorist, someone who's killed Americans, someone who's vowed to always kill Americans," Prouty explained.

Asked what happened to the terrorist she interrogated, Prouty told Pelley, "He's in a jail in Colorado, where he gets to see daylight one hour a day."

And she admitted she's happy about that. "It brought justice. This is what we're about. We're about bringing justice to the families of the victims," she said.

Pursuing justice for the FBI led her to much more dangerous missions at the CIA. She worked in Iraq during the most violent period of the insurgency. Armed with an assault rifle, she went on raids with U.S. Special Forces troops. She interrogated suspected terrorists, and she was part of the team that developed the intelligence on the whereabouts of Saddam Hussein.

Her CIA boss at the time said "many officers in the CIA were unwilling to serve in this deteriorating, high-risk and thankless environment. Mrs. Prouty did not waver."

While in Iraq, Prouty's bulletproof vest had to be altered for an extraordinary reason: she was pregnant at the time.

"People watching this interview right now are asking themselves, 'Why would she do that?'" Pelley asked.

"Yes, and I ask myself now, looking at my child, how could I put her life in danger? But that's what I wanted to do. I couldn't look at our Marines that are standing outside, guarding us, and tell them, 'Hey, I'm pregnant, I'm shipping out.' I knew what my contributions were. And I wanted to protect the lives of our soldiers," she said.

Prouty was born into war, growing up amid the conflict in her native Lebanon. At age 19, she came to the U.S. to get a degree in accounting. And years later, while studying for a master's degree, one of her teachers suggested she apply to the FBI.

Prouty had to wait two years while the FBI ran a background investigation. She was cleared in 1999 and became a rising star. After two more background investigations she got one of the nation's highest security clearances. And in 2003 she joined the CIA.

"She was absolutely dogged. She would never quit," Bob Grenier remembered. He met Prouty when he was CIA station chief in Islamabad, Pakistan.

He retired in 2006 as a 27-year veteran, who headed the CIA's Counter-Terrorism Center.

"She was involved in virtually all the high profile terrorism cases during those years," Grenier said.

"And became one of this country's most experienced officers in doing all of those cases?" Pelley asked.

"Yes. Young as she was, and as few years as she actually had in service, she was tremendously experienced," Grenier said.

Asked if she saved American lives, Grenier said, "I think that's fair to say."

But while Prouty was hunting terrorists overseas, an investigation began back home that would destroy her career. The Bush administration was working to break up terrorist financing. And by 2004, federal prosecutors in Detroit were looking at the large Arab-American population around Dearborn, Mich.

Suspicion fell on a Lebanese-American restaurant owner named Talal Chahine. And as it happened, Chahine was married to Prouty's sister. In 2005, FBI agents came to CIA headquarters to ask Prouty a few questions.

"They showed me a picture of my brother-in-law, with a spiritual leader at that time, I didn't know who he was, but with a spiritual leader from Hezbollah," Prouty remembered.

Hezbollah is the Lebanese group, backed by Iran and on the U.S. terrorism list. Prouty says she had little to do with Chahine. She thought he was a womanizer cheating on her sister. But because of the family ties, Prouty was under suspicion.

Asked what happened to her relationships with her colleagues and inside the agency, Prouty said, "Everybody scattered away. You would think that I had the plague. Nobody wanted to have anything to do with me."

That went on more than a year until, finally, in frustration, she went to Detroit to try to clear things up with the prosecutors.

"It wasn't until I sat face-to-face, until that was the time that I knew what I was being accused of," Prouty told Pelley. "And they said that I have viewed some documents in the FBI / ACS system without authorization."

"The FBI computer system?" Pelley asked. "What documents did they say that you had looked at?"

"They insinuated that it was documents relating to Hezbollah investigations," she replied.

Prouty says the prosecutors told her that the evidence against her was secret and she couldn't see the documents in question. But they implied that she had passed classified information.

"Look, the suggestion here, I mean reading between the lines, here, is that you looked for Chahine's name and your sister's name to see if the FBI was investigating," Pelley remarked.

"That's absolutely false and absurd," Prouty said.

She said she "absolutely" did not do that.

And, in fact, the investigation into whether she'd passed classified information turned up nothing. But prosecutors Eric Straus and Kenneth Chadwell kept digging and they stumbled on something that all those background investigations had missed or dismissed: it turned out that 18 years earlier, when she first came to the United States, Prouty had taken a fateful shortcut to citizenship.

She had arranged a sham marriage. "I understood it was wrong."

And she understood that was against the law.

In 1989, at age 19, Prouty, her sister and a girlfriend arranged bogus marriages to get their green cards and avoid going back to Lebanon, which was still at war. Eighteen years later, in 2007, prosecutors rounded them all up and charged them with conspiracy to defraud the United States.

Under pressure, Prouty agreed to waive the 10-year statute of limitations on immigration fraud and plead guilty to two felonies related to the sham marriage. She also pled guilty to one misdemeanor count of unauthorized use of an FBI computer, a charge she now denies.

"I've made that mistake when I was a 19-year-old teenager. And I shouldn't have made it. And I own up to it. But I did not look into FBI ACS system without authorization. I did not mismanage or mishandle any classified information," she told Pelley.

Asked why she pled guilty to that charge when she now says it wasn't true, Prouty said, "I had to make a decision. I could not see our limited financial resources disappear in front of our own eyes."

"From attorney's fees that amounted in the hundreds of thousands of dollars," she added.

But pleading guilty wouldn't be the end of it: prosecutors didn't have the evidence to make a terrorism case in court so they made one in the media.

In a November 2007 press release the prosecutors said, "It's hard to imagine a greater threat" than someone like Nada Prouty. They said that she had "exploit[ed] her access to sensitive counter-terrorism intelligence."

And, later, the Detroit office boasted it had uncovered "the only known case of an illegal alien infiltrating U.S. intelligence agencies with potential espionage implications," as if Prouty had plotted from the age of 19 to infiltrate the CIA. All the worse, there it was, a word never uttered in court -- "espionage."

Prouty was branded a traitor in the national news media.

"My family was destroyed. Neighbors wouldn't talk to us," Prouty recalled. "When my daughter would go out in the neighborhood, her friends would scatter away. They told her, 'We don't wanna talk to you 'cause your mommy is bad.'"

"One of the New York papers called you 'Jihad Jane,'" Pelley remarked.

"That's the Jane that went to Iraq and put her life on the line," Prouty said.

Before she was sentenced, the CIA launched its own investigation to find out if Prouty was a Hezbollah spy. Bob Grenier, the CIA's former head of counterterrorism, told Pelley what the Agency found.

"There was a full investigation which included multiple polygraph examinations," he said. "She was completely exonerated."

The CIA wrote a letter to the prosecutors saying "the Agency did not identify any information that Mrs. Prouty cooperated or engaged in unauthorized contact with a foreign intelligence service or terrorist organization."

Asked how thorough these investigations are and how seriously they are taken, Grenier told Pelley, "Oh, my God, you cannot imagine how seriously the CIA would take an investigation like that."

At sentencing, Federal Judge Avern Cohn blasted the U.S. Attorney's Office. "Perhaps prompted by the excessiveness of the press releases," he said, the news media "grossly distorted the circumstances of your case." "As a citizen," the judge told Prouty, "you served your country honorably and effectively."

But because of the law the judge was forced to revoke her citizenship. And instead of throwing her in prison, he fined her $975.

Read the Sentencing Hearing Transcript

The prosecutors received an award for their three-year Hezbollah investigation. But for all of the press they were seeking then, they declined to talk to us for this story.

But the Justice Department did send us a statement saying that it "makes no apologies for the prosecution of Nada Prouty." "She has no one to blame but herself." The statement says, "The actions taken by the government to address her crimes were measured, appropriate and consistent with obligations to uphold the law without fear or favor."

Read the full Justice Department Statement

"You know, there are people watching this who say, 'She was a CIA agent -- she's trained to lie,' Pelley said. "The prosecutors in Detroit certainly thought you were lying. What do you say to that?" he asked Prouty.

"I have the truth on my side," Prouty responded. "I've already been exonerated by the CIA. I've already been exonerated by a federal judge and I say to the people look at the evidence and make up your mind."

Prouty was to be deported to Lebanon, but because she would likely be killed by the very terrorists she investigated, the judge blocked her deportation. Today she lives in Virginia with an American husband she married in 2001, and their two children. But, as a "deportable alien," she must check in with immigration officers regularly. She can't get a job, open a bank account, or travel more than 50 miles from her home.

"I wonder whether losing your citizenship was the worst part of all of this?" Pelley asked.

"That was the most painful part," she acknowledged.

Asked how she feels about that, Prouty said, "I've carried a weapon in defense of my country and I've put my life on the line for the country. I've put the life of my unborn child for the country. And I've been in horrible situations, I've been shot at, and what the country gives me back is de-nationalization. They take away from me the most precious thing, the thing that I believe in the most. I feel like I've been stabbed in the heart.

Produced by Graham Messick