The Curious Case of Sue Mi Terry

The past few weeks have seen an unprecedented burst of indictments and convictions of Americans acting as foreign agents. A jury found Senator Bob Menendez guilty of acting as a foreign agent for the regime in Egypt. Formal charges were brought against the former top aide to New York Governor Kathy Hochul, accused of acting on behalf of China. But in Washington, there was another indictment that didn’t get nearly as much attention or condemnation—but which points directly to the rot at the heart of America’s think-tank industry, which has relied for years on foreign financing, much of it hidden from the American public.

The indictment, unsealed in July, accuses one of Washington’s most prominent analysts of the Korean peninsula of secretly acting for years as an agent of the government in South Korea. Sue Mi Terry is hardly a household name, but she has for years served as one of the go-to think tankers for all things Korea policy. Writing for major journals, hosting major events, working for America’s leading think tanks, Terry—a former CIA analyst and former member of the White House’s National Security Council—rose to the top of those voices helping steer U.S. policy vis-à-vis both North Korea and South Korea.

But as federal prosecutors alleged, there was another role that Terry played for nearly as long. “For more than a decade, Terry worked as an agent” for the South Korean government, the Department of Justice alleged. This, in and of itself, isn’t illegal. Any American can work as an agent of a foreign government, so long as they register their work with the attorney general. But Terry never did so—and so ran afoul of the Foreign Agents Registration Act, or FARA.

The allegations may not be as spectacular as those elsewhere—no one has accused Terry of hiding gold bars, à la Menendez—but they are just as insidious. In addition to accepting thousands of dollars in luxury goods from her South Korean handler (who among us hasn’t been offered Louis Vuitton handbags and Dolce & Gabbana coats from foreign intelligence officers?), Terry allegedly took funds from the South Korean government to publish on the Korean peninsula—a payment scheme that Terry hid from editors and readers alike. She also attended a private meeting with Secretary of State Antony Blinken to discuss Korea policy—and then, “immediately” after the meeting ended, hopped into a car with her South Korean handler, letting them photograph her notes from the off-the-record meeting.

Perhaps most egregiously, Terry—who worked for both the Center for Strategic and International Studies, or CSIS, and the Wilson Center think tanks—arranged at least one think tank event covertly hosted by her South Korean handlers, and never bothered to tell her colleagues that they were secretly being feted by Seoul. Moreover, as the indictment details, Terry secretly routed thousands of dollars from South Korea to her think tank, even directly discussing with her handler how South Korea “could covertly send [the] money,” making sure to avoid payments that would “look suspicious.”

There are many more allegations within the indictment, from Terry regurgitating South Korean talking points to enjoying meals at Michelin-starred restaurants. And she is, as with so many other alleged foreign agents now facing their own indictments, innocent until proven guilty. But taken together, the allegations paint a damning portrait of an American analyst who not only sold out to a foreign power but also sold out her editors, her colleagues, and even America’s most senior diplomat—a breach of trust that is, at a minimum, spectacularly unethical, and now potentially criminal.

Still, for all of the allegations drenching Terry, it’s telling that there has been relatively little criticism of her actions among the broader foreign policy establishment. Compared to things like the Menendez conviction, or even the recent indictments about Russian financing swirling conservative YouTubers, her breaches have been met with a deafening silence from the very voices that might cluck at the downfall of others in similar straits. Indeed, the little commentary that’s popped up about her work has largely been to defend her actions—and to instead slam the Department of Justice for charging her in the first place.

The most vociferous support for Terry’s actions came from former White House counsel Gregory Craig. In Just Security, Craig slammed the “lurid indictment,” describing it as “shockingly weak” and as something that will have a “chilling effect … on scholars across this space.” Per Craig, the Terry indictment indicates the “ease with which an American citizen … can be deemed to be a foreign agent.”

Craig should know; in 2019, he faced his own foreign lobbying–related charges, stemming from his work in Ukraine. A jury eventually acquitted Craig of the charges—an embarrassing setback for the DOJ in its fight against foreign influence, from which it’s only recently recovered. And yet, even in that acquittal, the details of Craig’s work in Ukraine—and the work of his firm, Skadden Arps—painted a similarly damning portrait of Americans willing to sell out to foreign governments.

Not only were Craig and his Skadden colleagues working with the regime of pro-Kremlin thug Viktor Yanukovych, the man Ukrainians tossed from power in their 2014 democratic revolution, but such work was organized by America’s most notorious foreign lobbyist, Paul Manafort. While working with Yanukovych’s regime, Craig and Skadden helped author a report that defended Yanukovych’s jailing of his primary political opponent, Yulia Tymoshenko, even claiming that Yanukovych’s power grab would be upheld in American courts. Along the way, Skadden coordinated directly with Manafort about the P.R. rollout for the report, with Craig going so far as to offer to “hand-deliver a copy” to a New York Times reporter. “People in [Kyiv] are very happy” with their work, Manafort later wrote directly to Craig. “You are ‘THE MAN.’”

Eventually, Skadden was forced to shell out millions of dollars in settlements with both the Department of Justice and Tymoshenko, related directly to its foreign lobbying work. Yet a jury decided that Craig himself hadn’t committed any crimes, allowing him to walk free. But Craig’s involvement pointed directly to a reality just as concerning. To swipe a quote, the scandals in the world of foreign lobbying aren’t always necessarily what’s illegal, but what’s still legal—and even perfectly acceptable in the morass of Washington.

Craig’s work, for instance, helped a budding autocrat strengthen his grip on Ukraine—a grip that only shattered when democratic protesters rose up to depose him—and that eventually toppled an entire foreign lobbying network overseen by Manafort. And while Craig himself was never convicted of any crimes, he was nonetheless outed as a key cog in Manafort’s efforts to entrench a pro-Kremlin strongman in Ukraine—and helped reveal why foreign regimes continue to hire American lawyers and law firms to help in their dirty work.

Now, with Terry’s indictment, we see something similar. The details in the indictment are, legally speaking, arguably the weakest of the recent spate of foreign lobbying cases—especially since the funds involved are only a fraction of the millions involved in things like the Chinese lobbying case in New York. But the total funds are almost beside the point. The indictment not only revealed Terry as someone who spent years allegedly hoodwinking Americans on behalf of a foreign government, but it also showed how and why foreign governments continue to target think tankers in Washington.

If nothing else, the Terry indictment will hopefully jump-start long-overdue transparency reforms in America’s think-tank sector. For years, think tanks have skated by without even basic transparency requirements—helping create foreign influence networks that are even more opaque than foreign lobbying efforts elsewhere. In recent years, things have gotten even worse, with the Biden administration rolling back minimal requests for transparency, even as dictatorships like the United Arab Emirates continue to splash millions at America’s leading think tanks.

Now, however, the Terry indictment presents an opening, and a potential spur for reform. Because if not, she’s almost certainly not the last think tanker we’ll see allegedly outed as an agent for a foreign government—and almost certainly not the last case that will reveal just how deeply the duplicity in America’s think tank community runs.