American officials said that about six weeks ago, Mr. Chalabi told the Baghdad station chief of Iran's Ministry of Intelligence and Security that the United States was reading the communications traffic of the Iranian spy service, one of the most sophisticated in the Middle East. According to American officials, the Iranian official in Baghdad, possibly not believing Mr. Chalabi's account, sent a cable to Tehran detailing his conversation with Mr. Chalabi, using the broken code. That encrypted cable, intercepted and read by the United States, tipped off American officials to the fact that Mr. Chalabi had betrayed the code-breaking operation, the American officials said.

Billmon says:

The details of the crime itself are interesting, but the really burning question - who in the administration leaked the NSA's family jewels to Chalabi - isn't addressed until deep in the story.....You've probably heard some of the names that are allegedly on the FBI's short list: Doug Feith, the undersecretary of defense for policy, William Luti, the deputy undersecretary for Near East and South Asia, and Scooter Libby, Cheney's chief of staff.

Josh Marshall says if the story's true, someone in the Pentagon is in a world of trouble.