AN ANALYSIS OF AGENCY METHODS FOR HANDLING PERSONNEL SECURITY CASES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-04718A002400370040-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 15
• Document Creation Date: December 9, 2016
• Document Release Date: June 29, 2001
• Sequence Number: 40
• Publication Date: April 19, 1957
• Content Type: MF

?>1J~5? s'7- IG 7/ 25X1 A
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EYES ONLY
SUBJECT : An Analysis of Agency Methods for Handling P
Security Cases
MEMORANDUM FOR: Director of Central Intelligence
1. This memorandum contains recommendations for your approval in
paragraph 5.
2. You will recall that in April 1956 you authorized a review of
our loyalty review procedures to determine whether Agency activities in
this regard are correct, humane, and within the spirit and intent of the
law and Executive Orders. In the following paper we have attempted to
analyze our procedures, weighing carefully the review procedures, methods
of employee appeal, length of time consumed, and particularly the Agency's
position should any case be carried to the courts. In preparing this
study, we have used all pertinent material inside the Agency, consulted
the Office of Security and the General Counsel. Four pertinent documents
are attached: I. A statistical compilation on Executive Order 10450 cases;
II. Cases for Special Employment Review Boards; EO 9835 cases; Security
Termination Cases, 1 December 1954 - 31 December 1956; III. Applicant
Information Sheets; IV. Procedural Due Process in Removals from the Federal
Service (prepared by V.S.C.S.C.). For secu-
rity and sensitivity reasons, only an original and one copy of this report
have been prepared and the latter will be kept in my files.
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3. Present Agency Methods.
a. Regulations.
At the present time, there are three Agency regulations
specifically referring to loyalty cases.
(1) Regulatior~ paragraph l.g. This regulation
reads as follows: "Employee Loyalty--Employee shall
be protected from unfounded accusations of disloyalty
through ark established Loyalty Review Board."
Vic.,.. ., ii ffrai.
(2) Regulation- This is a long regulation
which provides for a manner of handling cases under
Executive Order No. 10-450. It states the obligation
of the Director of Personnel, the Director of Security,
the General Counsel, and the Director of the Agency.
It provides for review of derogatory information, pos-
sible suspension, written statement to employee for
reasons of consideration of the case under this Execu-
tive Order, right of employee to submit statements in
refutation and the action which the Director may ul-
timately take, including termination of the employee.
In addition to the provisions for protection of the
employee noted above, certain additional protection is
granted to staff employees who are citizens of the
United States and who have a permanent or indefinite
appointment and who have completed their probationary
or trial period. Such additional protection includes
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written charges signed by the Director of
Personnel within 30 days after suspension; an
opportunity to answer such charges, submit af-
fidavits and supporting documents; a hearing
before a Security Hearing Board; recommendations
of the Board to be in writing, one copy of which
shall be available to the employee at his request.
In the event a determination is made not to make
a copy of the recommendation available to the
employee, the Hearing Board shall include its
reasons therefore as a part of its recommendation.
The entire case shall be reviewed by the Director
of Central Intelligence before a decision to ter-
minate is made final, and the employee shall be
furnished a written statement of the Director's
A"
decision. However, all of the above regulation Cis,
in effecti nullified by its last section entitled
"Special Security Situations" which provides that
in such situations the above regulation will not
take effect and that the DCI will act in accordance
with procedures established under the authority of
Section 102c of the National Security Act of 1947,
quoted hereafter.
"Notwithstanding the provisions of
section 6 of the Act of August 24, 1912
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(37 Stat. 555), or the provisions of any other
law, the Director of Central Intelligence may,
in his discretion, terminate the employment of
any officer or employee of the Agency whenever
he shall deem such termination necessary or ad-
visable in the interests of the United States,
but such termination shall not affect the right
of such officer or employee to seek or accept
employment in any other department or agency of
the Government if declared eligible for such em-
ployment by the United States Civil Service
Commission."
(3) Regulation- entitled "Separations--Employment
Review Board." This regulation refers to the Director's
statutory authority under Section 102c of the National
Security Act and reaffirms his right to terminate the
employment of any individual whenever he deems it neces-
sary or advisable in the interest of the United States;
that this is within his sole discretion and no appeal is
provided for by law. This regulation also provides that
the Director may appoint an Employment Review Board to
advise him concerning any particular case. l`(fc ~.~ e.;?ts ~...
b. Procedures.
(1) Limitation and Investigation. As a matter of actual
practice, the procedures in loyalty cases may be described
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briefly as follows. When the Office of Security
develops adverse information concerning an indi-
vidual, it immediately commences checking all
pertinent files and following all possible leads.
Depending upon the seriousness of the information,
the individual may be advised at that time of the
investigation, and may be removed from regular Agency
work and placed under the jurisdiction of the Office
of Security. Whenever the Office of Security believes
it has developed sufficient information, the employee
may be called in for questioning, both on and off the
polygraph. This questioning may develop additional
leads that should be investigated and this frequently
adds to the length of time required for the investi-
gatory phase of the case. It should also be understood
that under Executive Order 10-450 an FBI investigation
is required where there is any indication of communist
affiliation (and of course all suspected espionage
cases are within the jurisdiction of the FBI). It
should also be noted that when an investigation by the
FBI is required, this will be in addition to any inves-
tigation already done by the CIA, and this will prolong
a case considerably.
(2) Determination on a Board. Following the completion
of the investigations and security interrogation of the
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employee, a decision is made as to whether the case
should go to a Board or can be concluded by adminis-
trative action. In many instances, the Office of
Security may be satisfied as to the security and
loyalty of the individual on the basis of the investi-
gation and questioning and this will close the case,
at least for the moment. In others, where there is
question in this regard, the Security Office may con-
suit with the General Counsel as to whether a Board
should be established, and so recommend to the Director.
It is interesting to note that in only one loyalty case
was the information considered so conclusive that ter-
mination was recommended and implemented.
(3) Board Proceedings. The Boards are established
by order of the DCI and are generally composed of
Deputy Assistant Directors or above who are considered 4
impartial. At an early time after the establishment of
the Board the employee is advised of the nature of the
charges. Generally speaking sources of information or
allegations are not identified. The individual is ad-
vised that he may obtain legal advice from the General
Counsel's Office, but on at least one occasion has pro-
cured service of counsel from outside (whom the Agency
checked and cleared) at his on expenses
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The General Counsel or his Deputy and the
Director of Security or his Deputy serve respec-
tively as legal and security advisors to the Boards.
In both instances, these representatives attempt to
avoid the role of prosecutors and attempt to be judi-
cious and fair in their advice to the Board and the
employee, although both obviously place protection
of the Agency foremost. While this may be true, it
might be more clean-cut
if the employee were assi
another lawyer from the General 'Oounsef's Staff who
would be clearly identified as Defense Counsel much
as is the system used in military
courts martial.
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hear all available witnesses and to allow the employee
to be heard and to introduce evidence and witnesses to
his full satisfaction. This naturally is time consuming
as all the Board members and the legal and security re-
presentatives continue in their regular jobs and
consequently must fit Board meetings into the schedules
of five persons.
(ZE) Final Action. When the Boards have completed
their hearings, a summary of the findings and conclu-
sions is prepared to go to the DCI with the recommendations.
The Boards always endeavor to read a 1 perti eht
documents--including the full security file--before
commencing hearings. The Boards then endeavor to
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fully discussed and considered by the Board. It could
be argued that to permit the General Counsel and the
Security Advisor to file separate reports to the DCI
to be considered simultaneously with the Board report
might invalidate the philosophy for having an impartial
On occasion, the General Counsel and the Security
Advisor have seen fit to file differing or dissenting
opinions. [This is a questionable practice, which if
permitted should be in the nature of a minority opinion
Board of these senior officials .3 In fairness, it should
be noted that the General Counsel and the Security Ad-
visor may on occasion side with the employee against the
Board.
c. Cases.
From the time Executive Order No. 10-450 was promulgated
to 9 November 1956, 60 new cases have been considered by the
Director of Security to come thereunder. At the time of the
promulgation, there were pending eight cases which were in
the process of being handled under the old "Loyalty Board
Regulation" _ paragraph l.g.). The above figures include
25X1A9a th?case but do not include the -case. The above 25X1A9a
figures, furthermore, do not include seven cases presented to
the Special Employment Review Boards by offices or divisions
other than the Office of Security, nor the 214 cases during
the period from 1 December 1954 to 31 December 1956, wherein
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termination resulted from action by the Office of Security.
(These 214 cases arose almost totally from disclosures
during the polygraph examination and the large majority,
195, involved perversion. The rest involved poor credit;
blackmail possibilities; crime, such as embezzlement,
thievery, and other illegal or unethical activities; dis-
closure of classified information or association with
communist personalities. Of these 214, l/6 were employees
and 5/6 were persons about to enter on duty.)
25X1A9a (1) Ever since the - case securit cas r h
es
association or intellectual sympathy with the communists,
admitted membership or support of Communist Parties or or-
ganizations, relatives who were either sympathetic or
associated with communist causes, allegations of past pro-
communist statements or viewpoints, positions or actions
y
mad ave
been said to be considered under Regulation- Of the
total of 60 cases, an Employee Review Board has been named
in only 17 cases. Three have been disposed of by the Direc-
tor of Security and 38 have been disposed of by recommendations
from the Office of the General Counsel directly to the DCI.
(Variations on a few cases occur herein, such as appeals to
the Inspector General's Office or the DD/S.) Of the 60 cases
reported, 18 were sent to the FBI through some source other
than this Agency - Task Force). A multitude of allega-
tions are noted as factors in the 60 cases. These included
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apparently adverse to the United States' cause and
presumably pro-communist, as well as possible identity
of subjects with persons who were the subject of ad-
verse reports. In only six cases out of the 60 was
resignation or termination the final result and, in
each case, the DCI had called for an Employment Review
Board. (The only known case in which termination on
loyalty grounds has taken place without a Review Board
is the _ case.)
(2) Although there is a wide variation among the
60 cases, the time element averages as follows:
(a) FBI investigation--approximately
five months.
(b) Security Office action--approxi-
mately three months.
(c) General Counsel Office--approxi-
mately two months.
(d) Employment Review Board--approxi-
mately one to seven and one-half
months.
(e) DCI action--approximately one day
to five and one-half months.
(3) Although no entirely consistent action is taken
during the Employment Review Board hearings, usually the
subject of the inquiry is called; permitted to know in
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general, but not in writing, the nature of the
allegation; is heard and given an opportunity to
refute or deny the charges and may have counsel,
although the latter is usually someone from the
Agency.
1i. Possible Deficiencies in Procedures.
a. From the point of view of the employee:
(1) No Loyalty Board as provided for in Regulation
25X1A Paragraph l.g. is necessarily guaranteed --,-,
(2) No consistent procedure Fn accordance with
loyalty hearings of other agencies is necessarily
followed.
(3) The time involved from the start of the investi-
gation of the allegation to final decision may be a
year or more.
(4) The employee does not necessarily know what he
is attempting to refute.
b. From the Agency point of view:
(1) In all cases except the _ case, a Board of
some sort was provided (Employment Review Board) where
termination or resignation was the final outcome.
(2) [A consistent procedure by which the Agency would
be bound might provide the legal foothold for a court
of law to review the case, at least to the extent of
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determining whether Agency procedures had been followed s
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a. Recission of Regulation S [Paragraph l.91 and Regulation
but in fact procedures customarily in use provide
the subject of the inquiry with an impartial Board
and an opportunity to be heard.
(3) The greatest expenditure of time takes place in
the investigation carried on by the FBI rather than
in any Agency office (with only a few notable excep-
tions).
(1k) The Agency cannot afford to provide the employee
with written or specific accusations for obvious reasons.
c. General.
In certain cases involving persons coming on duty in the
Agency the fact that the polygraph is not given until after
they have given up other employment creates a hardship and
may prevent them from either reassuming their past employment
or obtaining other employment. This has been partially rec-
tified by the relatively new application information sheets
Nos. 1 and 2 which puts the potential employee on notice with
respect to further specific considerations involving his past
life. Insofar as possible, consideration should be given to
employing the polygraph examination prior to actual entrance
on duty with the Agency in any form.
Recommendations.
25X1A (It seems apparent that this Agency was originally es-
tablished on the thesis that the highest standards of personal
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responsibility, security, and loyalty was expected from
its employees and that the Director, in Section 102c of
the National Security Act of 1911-7, was given a wide authority
to insure this.) In those cases in which the Director is
immediately satisfied that grounds for dismissal exist (the
case) it is a waste of valuable time to require any
further administrative action such as an Employment Review
Board. That in those cases where it appears equally obvious
to the Director of Security or the General Counsel that the
charges are not specific or serious enough to require review
by a Board, the present handling is satisfactory, with the
possible exception that a review by the Inspector General
might be called for in certain cases. That in those cases
where the Director feels a further review is advisable he
can use Regulation and appoint an Employment Review
Board.
b. It is not recommended that a statement of charges be
provided the subject of the inquiry as this might establish
an undesirable precedent or provide grounds for attempting
.~~ u bra ~xc ~t.. ' a
court review.
c. It is recommended that every effort be made to speed up
handling of all loyalty cases to the utmost within the Agency
but that no suspension be permitted without payment or com-
pensation in order that no employee will be damaged materiallyx
by the need of thorough investigation and review.
.t-v 1U4,t o r
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d. Although no Agency Regulation need be written which
would establish the procedures in loyalty cases, a policy
should be followed which will permit:
(1) Advising the subject insofar as possible
of the nature of the charges.
/ (2) Permitting and assisting the subject to
obtain counsel within the Agency, said counsel
to represent the employee and not the Agency
during the proceedings.
(3) Always provide the subject an opportunity
to be heard, to proffer evidence, and to call
witnesses.
e.V"That every effort be made by the Agency to obtain in
the Civil Service Commission and all other Federal Agencies
a consistent recognition of its higher security and employ-
ment standards in order that personnel terminated by the
Agency will not necessarily be considered by these other
agencies as unqualified for Government employment elsewhere.
/ In this connection, all other Federal Agencies should be ad-
vised that any derogatory information concerning employees
has been put on file with the FBI. In this way, the CIA
files which might contain allegations, unresolved questions
or other grounds upon which the Agency decided to terminate
the employee within the concept of its higher security and
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O1HDENT1AL
employment standards but which could not fairly be termed
"derogatory information," would not be required to be re-
leased by the Agency.
fman B. Kirkpatrick
Inspector General
The recommendations contained in
Paragraph 5 are approved.
~~J t a7 /J 5 7 )
Director of Central Intelligence
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