At the time of his disappearance, the 31-year-old office had top secret security clearance, working on "classified planning and analysis of North Atlantic Treaty Organisation command, control and communications surveillance systems", U.S. military journal Stars and Stripes reports.
Instead, investigators said Capt. Hughes went to 19 Albuquerque bank branches and withdrew a total of $28,500 from his account.
Agents from the Air Force's Office of Special Investigations took Hughes into custody at his California home Wednesday, the Air Force said. The Air Force declared Hughes a deserter in December 1998.
"On June 5, during a passport fraud investigation, the US Department of State's Diplomatic Security Service interviewed an individual claiming to be Barry O'Beirne".
A former Air Force officer, Howard Hughes Jr., was missing for over 35 years. He could face up to five years of confinement, forfeiture of all pay and dishonorable discharge from the Air Force. That would be "totally out of character for the Bill we knew", she said.
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Hughes was supposed to travel to the Netherlands in July 1983 to work with North Atlantic Treaty Organisation officers on the operations of AWACS electronic surveillance planes.
But Card said no classified information leaks are suspected, nor is there an indication that Hughes was involved with the Soviet Union, but the investigation is ongoing.
William Howard Hughes Jr. allegedly deserted the Air Force in July 1983 after coming back from temporary duty in Western Europe, the Air Force said. The news of Hughes' disappearance made headlines the following year, with a front-page Albuquerque Journal announcing "Kirtland Launches Search for Officer Missing 5 Months" on January 17, 1984. In the wake of those disasters, Los Angeles Times journalist Tad Szulc reported in July of 1986 that intelligence officers believed the rockets may have been sabotaged with Hughes' help.
Told one of Hughes' three sisters at the time, 'We do not feel he disappeared voluntarily'.
In 1985 and 1986, several French and American rocket ships failed to launch properly and subsequently exploded, including the Challenger space shuttle.
"Until we have the whole story, we don't have the story", she told the newspaper.
Mr Szulc also said an intelligence officer told him Capt Hughes was "worth his weight in gold to the Russians in terms of future "Star Wars".