Former CIA official found with gold bars admits to sprawling scheme, agrees to forfeit $194 million

Washington — A former CIA official who was found with $40 million in gold bars at his home in May, pleaded guilty Tuesday, admitting to inventing fake classifieds programs to embezzle nearly $200 million in government money that he used to buy mansions and gold in Florida.

David Rush pleaded guilty to a single count of wire fraud during a hearing in federal court in Virginia.

As part of his plea deal, Rush agreed to forfeit at least $194 million, including 298 gold bars, two BMWs, 35 luxury watches and four luxury homes in Florida. He faces up to 20 years in prison.

In a filing known as a criminal information detailing Rush’s admitted allegations, prosecutors said he invented a fake classifieds scheme to embezzle $145 million in government funds through a shell company, using the money to buy the Florida homes he intended to resell for a profit. Furthermore, he “fabricated an allegedly sensitive government activity to justify the acquisition of gold bars,” prosecutors said.

“Although the real estate and gold acquisitions involved different transactions and intermediaries, they were executions of the same overall plan: RUSH created false classified authorities, directed and approved associated expenditures, caused contractors and subcontractors to carry out the transactions, and then exercised possession or control of the acquired assets,” the filing states.

Prosecutors said Rush had access to “highly sensitive and classified government programs,” although the filing does not name the CIA as his former employer. The spy agency and the FBI previously said the investigation began when the CIA referred the matter to the bureau. In the affidavit supporting the original criminal complaint against him, he was described as a “former senior-level employee” at a government agency in eastern Virginia.

The document says Rush caused an unidentified contractor known as Company 1 to transfer approximately $145 million to a holding company created under his direction. He then directed that company’s employees and a contractor to funnel that money to a holding company he controlled, and used the funds to purchase four properties in Palm Beach and Hobe Sound, Florida.

Rush was arrested in May. FBI agents found the gold bars, $2 million in cash and luxury watches while executing a search warrant at his home. Prosecutors said Tuesday the holding company had about $38.6 million left in its account.

The gold bars were purchased after Rush told the unnamed contractors “that he was working on a Top-Secret project in which he was to deliver high-value goods to unnamed individuals,” according to the reports. One of the contractors wired $45 million to the holding company in January, a transaction that forms the basis of the wire fraud charge.

Rush was initially charged with one count of theft of public funds, with investigators saying he provided false information about his education and military service on his government application, and that he fraudulently took military leave after his service ended.

In June, a federal judge ordered Rush to remain in custody while the case progresses, determining that he posed a serious flight risk.

At his detention hearing, government lawyers called Rush a “master manipulator” who lied to his neighbors about his status as a pilot, lied to his co-workers and exploited his “access to seniority.” A Justice Department lawyer said Rush “cannot be trusted” and is “fully willing and able to bend the rules.”