Prosecutors accused Woosley of receiving about $188,000, some of which he used to buy a new house and a boat.

Sources inside ICE tell Fox News the scam represents total breakdown of oversight within the agency, especially given the periodic background checks and financial examinations given to agents working within the sensitive Office of Intelligence. 

"It tells us that the vetting process and the checks and balances, the internal controls at ICE, obviously are inadequate," said Rep. Candice Miller, R-Mich., who sits on the House Committee on Homeland Security.  

"It's bad enough you find some employees, federal employees, who are misusing taxpayer dollars," Miller said.  "However, in this case, these are ... intelligence officers that are handling classified information."

One ICE employee involved was Ahmed Abdallat, the agency's intelligence supervisor in El Paso, Texas. Abdallat, a former colonel in the Jordanian Air Force, joined the agency in 1995 and worked throughout the Middle East, including three years in Saudi Arabia.