Pentagon Building Deep-Cover Spy Network Against China

ERBIL (Kurdistan 24) - The Pentagon is building a deep-cover spy program in which US operatives would go undercover as businesspeople and private-sector personnel without any overt US government affiliation, as a covert component of the Defense Department's larger economic warfare campaign against China and other competitors, the Washington Post reported Thursday, citing half a dozen people familiar with the initiative.

The program of nonofficial cover officers, known in intelligence circles as NOCs, is being overseen by Tom Rakusan, a 39-year CIA veteran who retired from the agency in 2021 after rising to deputy director of operations, the CIA's top spy runner, in 2017, and who later led the CIA's response to Russia's 2016 presidential election interference campaign. After leaving the CIA, Rakusan joined Cerberus Capital Management, the private equity firm co-founded by Deputy Defense Secretary Steve Feinberg, and followed Feinberg to the Pentagon in 2025.

The Pentagon denied the program exists. "This query appears to be built on information that is simply not true," Pentagon deputy press secretary Jacob Bliss said. "Whoever is feeding you these claims are either badly misinformed or deliberately leading you astray." The CIA declined to comment. Rakusan did not respond to a request for comment. Congressional committees do not appear to have been briefed on the initiative.

Economic Espionage As The New Priority

The initiative reflects the Trump administration's embrace of economic warfare as a core tool of statecraft, combining tariffs, export controls, investment in critical resources, and now covert economic intelligence operations. CIA Deputy Director Michael Ellis said in a September speech that the United States is broadening its espionage against China, specifically targeting Chinese companies in artificial intelligence, biotechnology, and advanced semiconductors. His predecessor as CIA deputy, David Cohen, argued in a Foreign Affairs article that the US should end its long-standing prohibition on sharing economic secrets gathered via espionage with American companies working on advanced technology to give them a competitive edge.

The overt side of the Pentagon's economic warfare effort is led by the Economic Defense Unit, established by Feinberg and run by another Cerberus alumnus, George Kollitides. The EDU has announced hundreds of millions of dollars in public investments including a $750 million deal to secure a major rare earth minerals deposit in Brazil.

The CIA's Declining Deep-Cover Capability

The Pentagon initiative comes as the CIA's own NOC program has quietly withered. A COVID-era internal CIA report revealed that approximately 75 percent of all deep-cover agency officers would be eligible for retirement by the mid-2020s. These veteran NOCs are now retiring without new ones being trained to replace them, former officials say, leaving very few actual deep-cover CIA officers in the field. The agency's NOC program has waxed and waned across decades, with ambitious expansion plans repeatedly collapsing due to inadequate training or mismanagement, including a post-2000s initiative known as the Global Deployment Initiative.

A Fraught Track Record

The Pentagon has a troubled history with deep-cover human intelligence operations. Military service records are difficult to conceal, and the rise of biometrics and digital tracking means operating under an alias has become increasingly difficult. The physical bearing of many Pentagon operatives makes them easy to identify. In one illustrative post-September 11 case, a group of Joint Special Operations Command NOCs posing as employees of a mining company in Africa had their cover exposed when actual geologists and engineers began asking technical questions they could not answer.

The legal framework for the new initiative also remains unclear. US intelligence agencies operate under Title 50 authorities governing covert action abroad, while the Pentagon operates under Title 10 military authorities. The new program would likely function as what former officials described half-jokingly as a Title 60 entity, a nonexistent hybrid legal authority combining elements of both.

The initiative also reflects shifting power dynamics inside the Trump administration, with the Pentagon seeking a record budget of $1.5 trillion and taking an increasingly assertive role in areas traditionally dominated by the CIA.