Navy Engineer, Wife Admit Trying To Sell American Submarine Secrets For Cryptocurrency: Feds

The wife of a former Navy engineer from Maryland has also admitted in federal court that she helped him try to sell some of America’s best kept submarine secrets to a foreign country in exchange for cryptocurrency.

Diana Toebbe, 46, of Annapolis, served as a lookout while her husband, Jonathan Toebbe, 43, serviced three “dead-drops,” which were picked up by undercover FBI agents during a year-long sting operation, federal prosecutors said Friday.

Diana pleaded guilty to conspiracy to communicate Restricted Data — four days after her husband admitted to the same.

The Toebbes were arrested last October and had initially pleaded not guilty to one count of conspiracy to communicate restricted data and two counts of communication of restricted data.

As part of Jonathan Toebbe’s plea agreement, he admitted that his wife was involved in the conspiracy, federal prosecutors said.

According to his plea, in April 2020, Toebbe sent a package to a foreign government, listing a return address in Pittsburgh, PA, containing a sample of Restricted Data and instructions for establishing a covert relationship to purchase additional Restricted Data. 

He began corresponding via encrypted email with an individual whom he believed to be a representative of the foreign government — but was actually an undercover FBI agent. 

Toebbe continued this correspondence for several months, which led to an agreement to sell Restricted Data in exchange for thousands of dollars in cryptocurrency.

On June 8, 2021, the undercover agent sent $10,000 in cryptocurrency to Toebbe as “good faith” payment. On June 26, Toebbe serviced a dead drop by placing an SD card containing military sensitive design elements about submarine nuclear reactors, hidden inside of a peanut butter sandwich into a pre-arranged location.

After retrieving the SD card, the undercover agent sent Toebbe a $20,000 cryptocurrency payment. In return, Toebbe emailed the undercover agent a decryption key for the SD Card. 

A review of the SD card found that it contained Restricted Data related to submarine nuclear reactors. On Aug. 28, Toebbe made another “dead drop” of an SD card in eastern Virginia, this time hiding the card in a chewing gum package. After making a payment to Toebbe of $70,000 in cryptocurrency, the FBI received a decryption key for the card. 

It, too, contained Restricted Data related to submarine nuclear reactors. The FBI arrested Toebbe and his wife on Oct. 9, after he placed yet another SD card at a pre-arranged “dead drop” at a second location in West Virginia.

Toebbe was facing a lifetime in prison, but because of his plea agreement will serve a minimum of 12-and-a-half years. He mus also help recover the cryptocurrency that the undercover agent sold him.

Pursuant to her plea agreement, Diana Toebbe will serve a sentence of not more than 36 months of imprisonment in federal prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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