INTELLIGENCE AUTHORIZATION ACT FOR FISCAL YEAR 1987 SECTION-BY-SECTION ANALYSIS AND EXPLANANTION TITLE I INTELLIGENCE ACTIVITIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89B00297R000300570011-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 35
• Document Creation Date: December 23, 2016
• Document Release Date: December 15, 2011
• Sequence Number: 11
• Content Type: MISC

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INTELLIGENCE AUTHORIZATION ACT FOR
FISCAL YEAR 1987
SECTION-BY-SECTION ANALYSIS
AND EXPLANATION
INTELLIGENCE ACTIVITIES
Section 101 lists the departments, agencies, and other
elements of the United States Government for whose intelligence
and intelligence-related activities the Act authorizes
appropriations for fiscal year 1987.
Section 102 makes clear that details of the amounts
authorized to be appropriated for intelligence and
intelligence-related activities and personnel ceilings covered
under this title for fiscal year 1987 are contained in a
classified Schedule of Authorizations. The Schedule of
Authorizations is incorporated into the Act by this section.
Section 103 authorizes the Director of Central Intelligence
in fiscal year 1987 to expand the personnel ceilings applicable
to the components of the Intelligence Community under Sections
102 and 202 by an amount not to exceed 2 percent of the total
of the ceilings applicable under these sections. The Director
may exercise this authority only when necessary to the
performance of important intelligence functions or to the
maintenance of a stable personnel force, and any exercise of
this authority must be reported to the two intelligence
committees of the Congress.
INTELLIGENCE COMMUNITY STAFF
Section 201 authorizes appropriations in the amount of
for the staffing and administration of the
Intelligence Community Staff.
Section 202 provides details concerning the number and
composition of Intelligence Community Staff personnel.
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Subsection (a) authorizes full-time personnel for the
Intelligence Community Staff for fiscal year 1987, and provides
that personnel of the Intelligence Community Staff may be
permanent employees of the Staff or detailed from various
elements of the United States Government.
Subsection (b) requires that detailed employees be selected
so as to provide appropriate representation from the various
departments and agencies engaged in intelligence and
intelligence-related activities.
Subsection (c) requires that personnel be detailed on a
reimbursable basis except for temporary situations.
Section 203 provides that the Director of Central
Intelligence shall utilize existing statutory. authority to
manage the activities and to pay the personnel of the
Intelligence Community Staff. This language reaffirms the
statutory authority of the Director of Central Intelligence and
clarifies the legal status of the Intelligence Community
Staff. In the case of detailed personnel, it is understood
that the authority of the Director of Central Intelligence to
discharge personnel extends only to discharge from service at
the Intelligence Community Staff and not from federal
employment or military service.
CENTRAL INTELLIGENCE AGENCY
RETIREMENT AND DISABILITY SYSTEM
Section 301 authorizes fiscal year 1987 appropriations in
the amount of for the Central Intelligence Agency
Retirement and Disability Fund.
ADMINISTRATIVE PROVISIONS RELATED TO
INTELLIGENCE AGENCIES
Section 401 exempts the CIA and NSA from the requirement
contained in 3303a of Title 44, United States Code, that the
Archivist may approve records disposal requests only after
publication of notice in the Federal Register and an
opportunity for interested persons to submit comments thereon.
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The requirement that the Archivist publish record disposal
requests in the Federal Register was added by ?204 of the
National Archives and Records Administration Act of 1984. By
requiring that the Archivist provide notice in the Federal
Register, the public would be given an opportunity to obtain
and comment on the the actual schedule of records proposed for
destruction. While the purpose of the provision was to give
the public a role in determining what records should be
destroyed, the legislative history makes clear that Congress
did "not intend . . . for such public notice to be a paperwork
burden for any affected parties or to unreasonably delay the
disposal of such records." H. Conf. Rpt. No 1124, 98th Cong.,
2d Sess., 29-30, reprinted in 1984 U.S. Code Cong. & Ad. News
3904-3905.
Unfortunately, the requirement for publication in the
Federal Register has become a paperwork burden for CIA and NSA
that has unreasonably delayed the disposal of records. The
problem arises because the CIA and NSA record control schedules
submitted to the National Archives and Records Administration
(NARA) are classified confidential. NARA has therefore decided
that the Federal Register notice concerning classified records
schedules will be limited to the following information:
a) the identity of the requesting agency;
b) the NARA job number assigned to the schedule; and
c) the reason the schedule is excluded from public
disclosure.
Because the CIA and NSA record destruction schedules are
classified and not accessible to the public, the statutory
requirement that the Archivist publish notice of them in the
Federal Register so as to provide the public an opportunity to
obtain them makes absolutely no sense. Furthermore, this
requirement unreasonably delays approval by the Archivist of
NSA and CIA record destruction schedules since the public is
given 60 days to comment on the notice in the Federal
Register. Exempting the CIA and NSA from the provision
requiring notice in the Federal Register of requests to destroy
records would expedite the process of approval of requests to
destroy records and not deprive the public of any information
they would otherwise be entitled to receive.
Section 402 amends the National Security Act of 1947 to
permit an interlocutory appeal by the United. States from any
decision of a United States court or a judge thereof on any
evidentiary ruling or dispositive motion when the Director of
Central Intelligence certifies that the decision being appealed
will have an adverse impact on the national security. Recently,
the United States has encountered significant problems in
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attempting to perfect interlocutory appeals of several court
decisions. The hallmark of these cases is an attempt by the
plaintiffs to force the United States to submit to civil
discovery and a trial on the merits, even though the
Government's legal arguments would likely eliminate the need
for discovery or further judicial proceedings if the issues
could be litigated fully on appeal. Moreover, in those cases
where the disclosure of sensitive national security information
is directly at issue, the United States needs the ability to
protect its information from any unnecessary risk of immediate
disclosure. Under current law the United States may find that
the only means of obtaining an immediate appeal to obtain a
dispositive ruling is to consider a contempt of court. These
problems can be resolved if the United States can obtain the
right to interlocutory appeal upon a certification that the
national security justifies it. It is not intended, however,
that-the-right established by this section in any way affect
the role of the Attorney General in managing the litigation
caseload of the United States. Additional information
regarding this provision, which cannot be provided in a public
document, has been previously provided to the Committees.
Section 403 amends the Central Intelligence Agency Act of
1949 to provide an additional retirement credit in lieu of a
post differential for service by non-CIARDS Agency employees at
unhealthful posts. As part of the FY86 Intelligence
Authorization bill, Congress approved legislation authorizing
extra retirement credits for those Agency employees who
participate in the Central Intelligence Agency Retirement and
Disability System. Under this legislation, Agency employees
who participate in CIARDS would have the option to elect to
receive a retirement credit of one and a half years for each
year of service at an unhealthful post in lieu of a post
differential. This benefit is the same as that provided to
Foreign Service officers under Section 817 of the Foreign
Service Act of 1980.
Because the provision in the FY86 Intelligence
Authorization Act was limited to CIARDS participants, those
employees who participate in other retirement systems do not
have the opportunity to earn extra retirement credits for
service at unhealthful posts. This section expands the
authority to pay extra retirement credits to those Agency
employees who participate in the Civil Service Retirement
System or in a "new Government retirement system" as defined in
Section 203(a)(4) of the Federal Physicians Comparability
Allowance Amendments of 1983. These Agency employees may serve
in the same unhealthful posts as Agency employees who
participate in CIARDS and equity demands that these Agency
employees have the same chance to elect an extra retirement.
credit as CIARDS participants. The amount of extra retirement
that would be paid and the circumstances under which it would
be aid are the same as that authorized for CIARDS participants
last year.
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Section 404 amends the CIA Act of 1949 and the National
Security Agency Act of 1959 to make clear that CIA and NSA can
continue to deal with security problems in the area of drug and
alcohol abuse without regard to the provisions of any other
law, rule or regulation. Recent court decisions and rulings by
both the Equal Employment Opportunity Commission and the Merit
Systems Protection Board have suggested that there will be
increasing emphasis on treating alcoholism and alcohol abuse as
a handicap protected under the provisions of the Rehabilitation
Act, which outlaws handicap discrimination. By implication
there will likely be a similar emphasis on treatment of drug
abuse as a handicap with the same protection. This may very
well result in an increased prospect of litigation whenever CIA
or NSA determine that drug or alcohol abuse requires the denial
or revocation of security approvals, or the denial or loss of
employment. Not only is there concern about the prospects of
having to litigate these decisions, but there also is a
likelihood that CIA and NSA will be forced more and more to
make accommodations to take into account these "handicaps,"
regardless of the security consequences of continuing to employ
.or clear such persons. In order to avoid these additional
administrative and litigation problems, which could
substantially impair the ability of CIA and NSA to carry out
their national security missions and functions, this amendment
would clearly authorize CIA and NSA to deal with the security
implications of alcohol and drug abuse in the same manner as in
the past. Additional information regarding this provision,
which cannot be provided in a public document, has been
previously given to the Committees.
Section 405 amends the National Security Act of 1947 (50
U.S.C. 401 et seq.) so that, in tort actions, including actions
arising under the U.S. Constitution, the United States will be
substituted for individual defendants employed by Intelligence
Community agencies who are sued in their personal capacities
for acts undertaken in the scope of their Government
employment. In recent years, it has become commonplace for
senior Intelligence Community officials to be sued.in their
individual (as well as official) capacities for making national
security judgments which they are authorized by law to make.
Intelligence Community officials live under the constant fear
that their official actions may result in years of litigation,
and that a judgment for monetary damages may ultimately be
entered against them. Responsible officials who must make the
most sensitive decisions affecting the national security cannot
be placed in an environment where they constantly have to be
concerned about their personal and financial well-being. This
provision amends the United States Code to provide that any
cause of action a person may have for tort claims, including
claims arising under the Constitution, for acts taken by
Intelligence Community officials during the scope.of their
employment, will be against the United States exclusively.
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This bill further provides that the existing procedures of the
Federal Tort Claims Act, shall be applied to litigation under
this section. Suits against intelligence officers or employees
in their individual capacities are precluded. The sole remedy
would be against the United States. This provision is intended
to be a waiver of sovereign immunity with respect to
Constitutional torts brought against officials in their
individual capacities. It is intended to retain for the United
States any defenses those individuals may have had in suits
brought against them. Thus, for constitutional torts the
United States for the first time shall be liable to the same
extent as the officer or employee would have been in any Bivens
action prior to the enactment of this provision. Remedies for
common law and statutory torts will remain substantially the
same, except that employees no longer will be subjected to suit
at all, and claims of absolute or qualified immunity will be
made by the United States.
The section further provides at subsection (c) that the
Attorney General shall defend any action referred to in
subsections (a) and (b). Personnel are required to initiate
notification of any tort action to the relevant United States
attorney.
Subsection (d) provides that a certification by the
Attorney General that the officer or employee was acting within
the scope of employment in an authorized activity shall convert
the action into a suit against the United States.
Subsection (e) provides for removal of cases brought against
officers or employees in state courts to federal district
court, and substitution of the United States as proper party.
Subsection (f) provides that the United States shall have
available to it all the defenses that would have been available
to it and to a defendant sued in his individual capacity, and
would nullify a provision in the Federal Tort Claims Act which
would otherwise exclude any action for claims arising in
foreign countries.
Subsection (g) emphasizes that the Attorney General may
compromise or settle any claims brought under this section.
SUPPORT FOR DEFENSE INTELLIGENCE
COLLECTION ACTIVITIES
Section 501 adds a new chapter 19 to subtitle A of Title 10,
United States Code, authorizing the establishment and conduct of
corporations or other business entities to provide support for
Department of Defense undercover intelligence collection
activities.
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proposed subsection 391 states that the purpose of proposed
chapter 19 is to clarify congressional intent with regard to
the establishment of commercial covers to support intelligence
collection activities.
Proposed subsection 392a defines a new term "intelligence
collection activities". The use of a new term rather than the
redefining of the term "intelligence activities" precludes the
development of two definitions (E.O. 1233.3 & statutory) for the
same term.
Proposed subsection 392b defines the term "intelligence
support activities" to mean the establishment, acquisition and
conduct of commercial cover systems and the acquisition of
logistical support thereto as described in subsections 393 and
394.
Proposed subsection 392c defines one of the terms in
subsection 392a, "foreign intelligence", as it is defined in
E.O. 12333.
Proposed subsection 392d defines one of the terms used in
subsection 392a, "counterintelligence", as it is defined in
E.O. 12333.
Proposed subsection 392e defines a new term, "commercial
cover", which is used throughout the proposed Chapter 19 of
this title.
Proposed subsection 393a authorizes the Secretary of
Defense or the Secretaries of the Military Departments to
establish and conduct commercial covers as commercial
entities. In making specific reference to consultation with
the Director of Central Intelligence and the Director of the
Federal Bureau of Investigation, this subsection is not
intended in any way to alter or derogate from the
responsibilities and authority of the Chief of mission to a
foreign country under 22 U.S.C. 3927 for direction,
coordination, and supervision of all U.S. Government employees
in that country (except for employees under the command of a
U.S. area military commander) or from established procedures
for coordination with the Secretary of State in the conduct of
clandestine activities. Subsection 393a further states that
the establishment of a commercial cover requires a finding in
the form of a written certification by the Secretary
responsible for the commercial entity that the commercial cover
is necessary to the conduct of authorized intelligence
collection activities.
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Proposed subsection 393b requires that the establishment
and operation of such commercial covers be in accordance with
prevailing commercial practice. Federal statutes that regulate'
the establishment and operation of commercial and industrial
type government activities shall not apply to the establishment
and operation of commercial covers conducted pursuant to this
section when there is a written certification by the Secretary
concerned or his designee that compliance with such statutes
would risk compromise of the commercial cover. It is not
intended that the authorities contained in this section will
relieve the Department of Defense from any requirements of
applicable laws. Any exemptions apply only to the operations
of the commercial cover. Commercial covers must of necessity
conform to standard commercial practices. Compliance with
statutory requirements that govern'routine government
procurement and financial transactions would not conform with
such prevailing commercial practices and would flag a
commercial cover entity as being connected with the United
States Government, thus risking the security of the commercial
cover and the underlying intelligence collection activities.
In the past, Congress has exempted the FBI from certain
procurement and financial requirements, e.g., the
Anti-Deficiency Act, 31 U.S.C., 1341, and the Department of
Defense is proposing that similar exemptions be authorized for
intelligence support activities. It is virtually impossible to
foresee and list by citation every statutory requirement that
may be incompatible with intelligence support activities.
Therefore, subsection 393b describes the exemptions
categorically in order to capture and embody all the provisions
that would risk compromising the commercial cover. Such
statutes encompass laws applicable to federal appropriations,
federal property management, federal acquisitions, federal
employment, and government corporations. These categories of
law are defined below.
"Federal acquisitions" means acquiring real estate, goods
or services for the United States Government. These activities
are principally governed by Titles 41 and 10 of the United
States Code. Title 41 requirements that may be incompatible
with intelligence support activities include:
41 U.S.C. 5 which establishes the requirement to advertise
proposed purchases and proposed contracts for supplies or
services.
41 U.S.C. 35 which requires the inclusion of contract
provisions such as the Walsh-Healey Act representations and
stipulations.
41 U.S.C. 46 and 48c which establish the requirement to
purchase blind-made products.
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41 U.S.C. 255 which limits advance payments to contractors.
41 U.S.C. 253 which requires full and open competition.
Title 10 requirements that may be incompatible with
intelligence support activities include:
10 U.S.C. 2207 which prohibits contracting unless the
contract contains specific provisions.
10 U.S.C. 2276 which makes the contractor's books subject
to Government audit.
10 U.S.C. 2301 which prohibits cost-plus-a-percentage-of-
cost contracts. This section also subjects a commercial
cover to small business set-asides. This, may conflict with
prevailing commercial practice.
10 U.S.C. 2304 which limits the use of negotiated pro-
curements. Formal advertisement (sealed bids) may not be
consistent with prevailing commercial practice.
10 U.S.C. 2306 which places restrictions on the kinds of
contracting that may be used. These restrictions may
conflict with prevailing commercial practice. This section
also creates a right to examine all books, records, etc. of
the contractor or subcontractor. This may also identify
the intelligence support activity as a U.S. Government
entity.
10 U.S.C. 2307 which prohibits certain advance payments for
property and services. This may conflict with prevailing
commercial practice.
10 U.S.C. 2313 which creates a right to inspect plants and
audit books of certain contractors and subcontractors.
Such an inspection would identify the contracting agency as
a United States Government entity.
10 U.S.C. 2360 which creates a right for students
contracting with the Government to be entitled to be
considered as employees which may identify the contracting
agency as a United States Government entity.
10 U.S.C. 2381 which requires certain measures for
non-negotiated procurements which will identify the
contracting agency as a United States Government entity
(surety bonds, charges, etc.).
10 U.S.C. 2384 which requires supplies furnished to a
military department to be uniquely marked, which will
identify the contracting agency as a United States
Government entity.
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10 U.S.C. 2631 which restricts transportation of supplies
to U.S. Flag Vessels. This may conflict with prevailing
commercial practice.
"Federal property management" means the control and use of
federal real and personal property. These activities are
principally governed by Titles 40 and 10 of the United States
Code. Restrictions that may be incompatible with commercial
covers include:
40 U.S.C. 34 which limits the leasing of space in the
District of Columbia.
40 U.S.C. 33a which establishes restrictions on
construction loans for office buildings by Government
corporations.
40 U.S.C. 129 which establishes limits on a Government
corporation's leasing of buildings in addition to the
limitation on rental rates and prohibits the inclusion, in
any lease, of any provision regarding the repair of real
property.
10 U.S.C. 2662 which requires reporting of certain real
estate transactions to Congress 30 days in advance of the
transaction.
10 U.S.C. 2672 restricts agency authority to acquire an
interest in land to $100,000 or less.
10 U.S.C. 2676 limits authority to acquire land unless
acquisition is expressly authorized by law.
"Federal employment" means restrictions, rights, duties,
and entitlements flowing from Part III of Title 5 of the United
States Code. The intent of this section is to exclude from the
application of Title 5, United States Code, employees of the
commercial cover who are not federal employees occupying
positions within the commercial cover. The restrictions,
rights, duties, and entitlements that may be incompatible with
prevailing commercial practices include:
5 U.S.C. 3101 et seq. which limits the authority to appoint
employees.
5 U.S.C. 5101 et seq. which establishes classes of
employees and prescribes levels of pay for those classes.
5 U.S.C. 4101 et seq. which establishes training programs.
5 U.S.C. 4301 et seq. which establishes a performance
rating system for employees, including minimum due process.
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5 U.S.C. 6101 et seq. which establishes a leave and
attendance system.
5 U.S.C. 7101 et seq. which establishes a system for
adverse actions, including removal.
5 U.S.C. 8101 et seq. which provides for insurance and
other entitlements.
"Government Corporations" means a corporation that is owned
by the Federal Government. While commercial covers are not
Government corporations in the classical sense, they
nonetheless meet definitions set out in 31 U.S.C. 9101(1).
Government corporations are principally governed by Title 31 of
the United States Code. Requirements that pertain to
Government corporations that may be incompatible with
commercial covers include:
31 U.S.C. 9102 which requires that each corporation
established or acquired by an agency be specifically
authorized by Congress.
31 U.S.C. 9103 which requires an annual budget submission
to Congress.
31 U.S.C. 9107 which requires Comptroller General's
approval prior to the consolidation of a corporation's cash.
31 U.S.C. 9108 which limits the obligations that may be
issued by a Government corporation.
It is intended that commercial covers utilize these
exemptions only to the extent that it is necessary, and that
they be conducted in a manner that is generally consistent with
ordinary commercial practice. Adequate safeguards are provided
in the legislation and the Department's own procedures will
further ensure the proper application of the exemptions and the
appropriate use of funds.
Subsection 393c authorizes the deposit and withdrawal of
appropriated and generated funds in banks and other financial
institutions.
Subsection 393d requires that all proceeds generated by a
commercial cover that are no longer necessary to offset
necessary and reasonable expenses of the commercial cover,
revert to the U.S. Treasury as miscellaneous receipts.
Subsection 393e requires that funds resulting from a final
disposition of a commercial cover, after all obligations have
been met, shall be deposited in the United States Treasury as
miscellaneous receipts.
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Proposed subsection 394a grants to the Secretary of Defense
or the Secretaries of the Military Departments, or their
designees, the authority to acquire necessary services,
personalty, fixtures, and realty in order to support a
commercial cover.
Proposed subsection 394b requires that acquisitions made
pursuant to subsection 394a utilize procedures that are
consistent with prevailing commercial practice. The subsection
further provides that such acquisitions shall be exempt from
laws governing federal acquisitions, federal appropriations,
federal property management, and federal employment where the
application of such laws would risk the compromise of the
commercial cover. It is not intended that the authorities
contained in this section will relieve the Department of
Defense from any requirements of applicable laws. Any
exemptions apply only to the operations of the commercial
cover. For a discussion of these laws see the analysis above
pertaining to proposed subsection 393b.
Proposed section 395 requires the establishment of a system
whereby the Secretary of Defense is responsible for ensuring
adequate oversight and accountability for all intelligence
support activities undertaken pursuant to this chapter.
Proposed subsection 396a requires all intelligence support
activities authorized pursuant to proposed sections 393 and 394
to be undertaken in accordance with regulations promulgated by
the Secretary of Defense.
Proposed subsection 396b requires the Secretary of Defense,
or the Secretaries of the Military Departments to ensure that
an annual review and audit is conducted of each intelligence
support activity. It further requires that the House Permanent
Select Committee on Intelligence and the Senate Select
Committee on Intelligence be kept fully and currently informed
of all intelligence support activities.
Proposed subsection 396c makes it clear that all
intelligence support activities undertaken pursuant to this
chapter are to be protected from unauthorized disclosure as set
forth in 50 U.S.C. 403(d)(3).
ENHANCED FBI COUNTERINTELLIGENCE CAPABILITIES
Section 601 would amend the Right to Financial Privacy Act
of 1978 (12 U.S.C. ?3401 et. seq.) by making-certain of the
special procedures set forth in Section 3414 mandatory.
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Section 3414 currently provides that a Government authority
authorized to conduct foreign counterintelligence
investigations may obtain financial records from a financial
institution by submitting a certification signed by the
supervisory official of a rank designated by the head of the
Government authority. However, Section 3414 does not compel
the financial institution to disclose the requested records.
There have been instances wherein financial institutions have
declined to provide records requested pursuant to Section 3414.
Officials of such institutions have stated that they would
produce the requested records only in response to a subpoena.
Although the current number of refusals is not high, certain
major banks have refused to comply with requests for financial
data. Knowledge that these financial institutions will not
comply with requests for financial data has in some cases
deterred the FBI from making the requests. Thus, as long as
Section 3414 is retained in its current form, the FBI and other
government agencies may face the obstacle of a recalcitrant
financial institution in a foreign counterintelligence
investigation. Enactment of this section will ensure that
government agencies involved in foreign counterintelligence
investigations will have access to financial data relevant to
the particular matter being investigated. Congress will
continue to receive notice concerning use of this authority
through existing reporting provisions as set forth in 12 U.S.C.,
Section 3421.
Section 602 would provide access by the FBI to tax return
information in foreign counterintelligence investigations.
Disclosure of tax information by the Internal Revenue Service
(IRS) is generally proscribed by ?6103(a) of Title 26, United
States Code. A variety of exceptions to the prohibition on
disclosure of tax information are contained in Sec. 6103. With
respect to criminal investigations, tax return information may
be released without a court order if the matter pertains to tax
administration. Release of tax returns and return information
needed in the course of a non-tax criminal investigation must
be authorized by a court order. 26 U.S.C., 6103 (i) (1) (A) .
Release of return information other than taxpayer return
information for use in non-tax criminal investigations may be
authorized by the Secretary of the Treasury upon receipt of a
request from the head of a federal agency involved in
enforcement of federal criminal statutes. For example, the
Director of the FBI may request such information.
Unfortunately, none of the aforementioned provisions provide
any access to tax returns or taxpayer return information in
foreign counterintelligence investigations. Access to
financial information, including tax returns, is important
to investigating espionage activity because recent cases
(e.g., Bell, Harper, Barnett) have shown that one important
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motive for espionage can be financial gain. While it is
possible to obtain tax return information through a court order
for use in a criminal prosecution, there are instances where
access to tax information is an important investigative aid
even though criminal prosecution is not possible or desirable.
In many of these cases, the national security interest of the
United States is better served by convincing a person engaged
in espionage to work against the intelligence service of a
hostile government rather than prosecuting the individual. In
other instances, there'may not be enough evidence developed to
anticipate going forward with a criminal prosecution. Enactment
of this section will enable the FBI to obtain vital information
in foreign counterintelligence investigations not connected
with an impending criminal prosecution.
Enactment of this section also will be of vital help to the
FBI in preventing the illegal export of high technology items.
The buyers and sellers of goods containing advanced technology,
the export of which is prohibited, conceal their activities in
a series of small shell corporations. The ability of the FBI
to trace the flow of money and make comparisons of losses and
earnings in order to establish the fraudulence of the
transaction and identify the final recipient of goods will be
facilitated with access to tax records of individuals and
businesses.
Enactment of this section also will be useful in helping
the FBI keep track of certain foreign students who are
sponsored by foreign governments. These students are required
to file with the IRS Form 2063 (US Departing Alien Income Tax
Statement), upon departure. These forms are collected in
Philadelphia, Pennsylvania and are important to the FBI as a
quick means of verifying the exact date of departure of a
student. This information is not readily available from other
sources. Consultation with officials of the IRS has determined
that this information falls within the definition of taxpayer's
return information and, therefore, is available only pursuant
to a judicial order. Enactment of this section will allow the
FBI access to these records without having to obtain a court
order.
In summary, enactment of this section would authorize the
FBI access, under proper controls, to tax return and taxpayer
information of individuals who are subjects of foreign
counterintelligence investigations and would allow for the
dissemination of this information to other members of the
Intelligence Community. Because the FBI can only obtain an
individual's return under this section upon a determination by
the Attorney General that there is probable cause to believe
that a taxpayer is a foreign power or agent of a foreign power,
use of this investigative technique will occur only after
substantial information has been gathered about the taxpayer's
involvement in espionage or activities of counterintelligence
interest.
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Section 603 provides access by the FBI to telephone
subscriber information and toll billing record information from
a communications common carrier. The need for this provision
has its roots in the difficulties that the FBI encounters in
certain areas of the country in obtaining telephone toll record
information pursuant to National Security Letters (NSL).
Pursuant to an agreement reached approximately ten years ago
between the Department of Justice and AT&T, NSL's are utilized
in lieu of subpoenas to obtain telephone toll record information
in foreign counterintelligence investigations. However, State.
privacy statutes, as well as court and agency decisions, are
causing certain companies, particularly in California, to
refuse to honor NSLs. Indeed, decisions of the California
Public Utility Commission (PUC) have resulted in no companies
in California honoring NSLs . This section would make it
mandatory for communications common carriers to produce
requested telephone subscriber information pursuant to an NSL
signed by the Director of FBI or a supervisory official
designated by him. The section also prohibits the disclosure
of such a request and authorizes dissemination of information
obtained pursuant to this section to other agencies within the
Intelligence Community.
Section 604 would authorize the FBI to pay for the
expenses necessary to conduct a foreign visitor exchange
program. A number of United States Government agencies have
foreign visitor programs wherein representatives or foreign
agencies travel to the United States as guests of the United
States agency to promote international cooperation between the
two agencies. These visits are not training programs but
rather observation programs to provide foreign visitors with
an overview of the United States agency operations in certain
areas in order to enhance the foreign United States agency
operations in these areas and to foster greater international
cooperation between the respective United States and foreign
agency. Presently, there is no FBI authorized funding
available to sponsor such a program. It is envisioned that
this funding will be utilized to pay the expense of bringing to
the United States certain Senior Executives who have
counterintelligence responsibilities in foreign agencies
with which the FBI maintains close contact. These foreign
representatives would be invited to the United States to
provide them with a thorough overview of FBI operations in
areas of mutual interest. These visits also would serve as an
exchange program to allow the FBI to gain expertise from that
foreign representative.
Section 605 would allow access for the FBI to state and
local criminal records for national security purposes similar
to the relief that was granted to the CIA, DOD, and OPM in the
Intelligence Authorization Act for FY 86. That Act does not
include the FBI in its provisions, despite the longstanding
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responsibilities of the FBI in the conduct of background
investigations. However, the FBI has also faced difficulties
in recent years in obtaining criminal records information from
state and local agencies for purposes of conducting background
investigations, primarily because of state and local
legislation triggered by, and similar to, the Privacy Act.
An example of the difficulty in obtaining criminal history
record information for purposes of conducting a background
investigation can be found in California. The FBI's California
offices have been precluded from access to the California law
enforcement telecommunication criminal justice information
system for the purpose of conducting background investigations
because the California Department of Justice has interpreted
the State's Freedom of Information/Privacy Acts, which prohibit
use of information developed by law enforcement agencies for
other than law enforcement purposes, to exclude background
investigations from the realm of law enforcement purposes.
Even with a release from the applicant, some information on an
applicant has been withheld.
Other states have similar laws restricting the use of
criminal record information for employment purposes. To date
these laws have not been interpreted to preclude FBI access to
the records for the purpose of conducting background
investigations. There is no guaranty, however, that these
states may not someday take a different position. Because the
FBI is decentralizing its record keeping practices and state
and local authorities have become increasingly responsible for
the maintenance and dissemination of their criminal records, a
change in position by these states to deny the FBI these
records could drastically reduce the ability of the FBI obtain
complete criminal record information for background
investigations.
To address the current problems and potential concerns
stated above, the FBI should be added to those agencies
entitled under Section 9101 of Title 5, United States Code, to
obtain access to state and local criminal history records.
This will ensure that the FBI can adequately fulfill its
responsibilities in conducting background investigations.
DOD ADMINISTRATIVE AND PERSONNEL IMPROVEMENTS
Section 701(a) amends section 624(c) of title 10, United
States Code, to delete the requirement for Senate confirmation
for appointment to the next higher grade of certain officers on
the active duty list who are involved in classified
intelligence operations and approved by the President for
appointment to grades below 0-7 (Brigadier General or Rear
Admiral (lower half)).
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At present, military officers participating in classified
intelligence operations who are otherwise eligible for
promotion must, in order to obtain Senate confirmation for
promotion to grades above captain or, in the case of the Navy,
lieutenant, be identified publicly by name during the
confirmation process. Because of this public scrutiny, the
officers and the operations themselves may be endangered.
As a result, many qualified, dedicated officers-recommended for
promotion have been, in the interests of national security,
unable to be promoted and have lost the corresponding increases
in pay and allowances and other privileges and benefits of the
higher grade.
This section amends section 642(c) to empower the President
to appoint such officers to grades below 0-7 (Brigadier General
or Rear Admiral (lower half)) after the Secretary of Defense
has approved the use of a secure promotion list and the
appropriate Service Secretary has determined that the
procedures in section 624(c) [redesignated as section
624(c)(1)] would either endanger the officers or compromise the
operations in which they are involved, or both. The Secretary
of Defense would report at least annually to the Senate and
House Armed Services Committees the number of officers so
appointed and the grades to which they are promoted.
Section 701 (b) provides that the amendments to section
624(c) are effective on the date of its enactment, but provides
for authority to apply the provisions of section 624(c)(2) to
any officer recommended for promotion by a selection board
convened under chapter 61 (to include a special selection board
convened under section 628(a)(1)) on or after September 15,
1981, but who has not been promoted because of concerns that
the public scrutiny inherent in the confirmation process would
compromise a classified intelligence operation or be dangerous
to the officer.
The section further provides for the establishment of
retroactive effective dates of promotion for all purposes and
establishment of a date of rank and position on the active duty
list that such officers would have received had their names
been included on the list from which the officer was excluded,
and that list was approved by the President and forwarded to
the Senate. It may be that a date of rank and position on the
active duty list established under this section will result in
a situation in which, had the officer originally been promoted
under section 624(c) and received that date of rank and
position on the active duty list, that officer subsequently
would have been within a promotion zone established by the
Secretary concerned under section 623 for promotion to the
grade next above that to which the officer had been recommended
but not promoted to because of security concerns. Section
701(b) provides that such officers, upon promotion under that
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section, are, if otherwise eligible, further eligible for
consideration by a special selection board convened under
section 628(a)(1). If recommended by that selection board for
promotion to a grade below brigadier general or rear admiral
(lower half), the officer could again be promoted under the
procedures established by section 701(a) of this Act, with a
date of rank, an effective date for the pay and allowances of
that grade, and a position on the active duty list determined
under section 628(d)(2).
Section 701(b)(a) further provides that the officers
promoted under that section shall not, during the fiscal year
in which their promotion is accomplished, be counted against
any strength in grade limitation established by law. This
section further provides that the Secretary of Defense shall
include in, the report required by section 701(a) of this Act
the number of officers promoted under this section.
Section 701(c) provides that in the event that the
appointment of an officer under chapter 61 in the grade in
which that officer is currently serving was delayed because of
participation in a classified intelligence operation, the
Secretary concerned may adjust the date of rank, effective date
of promotion for all purposes, and position on the active-duty
list of that officer in order to obviate the seniority and pay
consequences of that delay. Section 701(c) further provides
that in the event that the officer would have been in a
promotion zone to the next higher grade established by the
Secretary concerned under section 623 had that officer been
promoted without such delay, the officer, if otherwise
eligible, is further eligible for consideration by a special
selection board convened under section 628(a)(1). It
recommended by that selection board for promotion to a grade
below brigadier general or rear admiral (lower half), the
officer could be promoted under the procedure established by
section 701(a) of this Act, with a date of rank, an effective
date for the pay and allowances of that grade and a position on
the active-duty list determined under section 628(d)(2).
Section 701(d) establishes a procedure whereby the
Secretary concerned may, in order to effectuate actions taken
pursuant to sections 701 (b) or (c), correct the records of the
officers concerned without reference to a Board established
under section 1552 and without application by the officers
concerned. Such a correction is binding upon all officers of
the United States, and, since a retroactive or adjusted
effective date of promotion would entitle the officer concerned
to back pay and allowances, such a correction would authorize
the expenditures, from applicable current appropriations, for
such pay and allowances.
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Section 701(e) establishes an expiration date of September
30, 1987 for the authority provided by section 701(b) - (d) to
take corrective actions in the case of officers who were not
promoted or whose promotions were delayed because of security
concerns. Since section 701(a) provides a permanent mechanism
to effectuate the future promotion of officers engaged in
classified intelligence operations whose promotions have not as
of the date of this Act, been effected by security concerns.
The special corrective provisions of sections 701(b)(d) are not
needed on a permanent basis.
Section 702 seeks to extend by two fiscal years the
termination authority of the Secretary of Defense with respect
to the employment of any civilian officer or employee of the
Defense Intelligence Agency (DIA). Subsection 501(a) of the
Intelligence. Authorization Act for FY85, P.L._98-618,
authorized the Secretary of Defense to exercise the above
termination authority whenever such an action was considered by
him to be in the best interests of the United States and he
determined that the termination procedures otherwise authorized
by law could not be "invoked in a manner consistent with the
national security." As enacted, paragraph 1604(e)(1) of
chapter 83 of title 10, United States Code, extended this
authority to the Secretary of Defense for fiscal years 1985 and
1986. The regulations which were subsequently written to
implement this authority have been finalized within DIA and
they are now in the final stages of OSD coordination. The
extension of authority is being requested so as to allow DIA an
opportunity to have two full fiscal years of experience under
the implementing regulations. Then, as the end of the extended
time period draws near, a determination can be made as to
whether the termination authority should be modified and/or
enacted into permanent authority.
Section 703 addresses a provision included in the FY85
Intelligence Authorization Bill designed to markedly enhance
Defense Intelligence Agency's (DIA) capabilities to structure
attractive and flexible career opportunities for its civilian
professional intelligence work force. This earlier legislation
provided authorities parallel to those enjoyed by the Central
Intelligence Agency and the National Security Agency, thereby
eliminating a major disadvantage that had affected DIA's
ability to attract top quality careerists. The operative
effect of the legislation was to exempt DIA from the
requirements of the Classification Act, allowing DIA to
factor in the individual circumstances of the person in the
job in determining grade and revise standards to reflect the
changing intelligence environment of the second half of the
1980's and the 1990's. In addition, the legislation
facilitated the separation of civilian employees when such
separation is deemed to be in interests of the United States
and consistent with the national security.
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Section 703 is intended to improve the management of
civilian intelligence personnel within the military departments
and to correct actual personnel management system inequities
and disparities existing within the Department of Defense
intelligence community. Notwithstanding the fact that the
military departments' intelligence collection and production
requirements have become more and more demanding and the
military departments exercise varying degrees of intelligence
collection and production responsibilities as vital
contributors to the Intelligence Community-wide intelligence
effort, they continue to labor under the restrictions of the
Classification Act. That Act hinders the military departments'
efforts to create viable and competitive professional
alternatives for their civilian intelligence officers and
employees. With regard to their civilian intelligence officers
and employees, the military departments simply do not have the
flexibility in personnel matters enjoyed by CIA, NSA, and DIA
under applicable statutes. As a consequence, the military
departments have been significantly handicapped in their
ability to recruit and reward outstanding analysts and other
intelligence specialists and employees, and otherwise to
operate an equally effective civilian personnel system.
Consequently, military intelligence management of the
collection, processing, analysis, and dissemination processes
is at a decided disadvantage. As a functional equivalent
within the defense and national intelligence communities, the
need exists for equivalent intelligence management and
functional authorities to be vested in and retained by the
military departments. Enactment of this legislative proposal
will allow the military departments to create a flexible,
viable, and attractive civilian personnel management system.
Specifically, enactment of this legislative proposal would
create conditions that would promote continuous modernization
of military intelligence civilian position classification and
qualification standards to keep pace with: intelligence
consumer expectations for increased quantity and enhanced
quality of intelligence products; the impact of new
technologies and initiatives upon intelligence management,
collection, processing, and dissemination methodologies; and,
Service intelligence reorganizations that are driven by
emerging intelligence collection and production imperatives.
Moreover, enactment of these provisions would allow the
Services to implement de facto multi-tracked career and
training programs for its civilian intelligence officers and
employees and invest "rank in the person" rather than in the
job in which the civilian intelligence officer or employee
serves as the incumbent.
All of the authority vested in the Secretary of Defense by
P.L. 98-618 with regard to the Defense Intelligence Agency
remains unchanged. This legislative proposal represents a
straight forward extension of 10 U.S.C. 1604 authorities to the
military departments.
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The effect of amendments to 10 U.S.C. 1604 (a) through (e),
as outlined above, would be to authorize the Secretary of
Defense, delegable only to the Secretaries of the military
departments, to establish a flexible personnel management
system for those personnel who are not in the Senior Executive
Service of the military departments. The phrase "civilian
intelligence officers employees" encompasses those individuals
who perform an intelligence function, i.e., the majority of the
incumbent's time is spent advising, administering, supervising,
performing, or supporting work in the collection, processing,
analysis, production, evaluation, interpretation, dissemination
or estimation of intelligence information, or in the planning,
programming, and management of intelligence resources. Salaries
and pay of such individuals would be fixed in relation to the
General Schedule and Wage Grade (prevailing rate) system. A
flexible classification system would be established which would
incorporate the concept of both position classification and
rank in the person. The system would be structured to permit
assignment, movement, and career development without cumbersome
classification and related administrative procedures.
Subsection 703(a) contains a number of amendments to
U.S.C. 1604. It amends 1604(a) to authorize the Secretary of
Defense to establish civilian intelligence positions in the
military departments and to appoint individuals to such
positions, without regard to civil service requirements.
Subsection 1604(b) is amended to authorize the Secretary of
Defense to fix pay for positions established under subsection
(a) in relation to the General Schedule (GS) rates.
Subsection 1604(c) is amended to authorize a prevailing
rate system of basic compensation for positions in or under
which the military departments may employ individuals in a
trade, craft, or manual occupation.
Subsection 1604(d) is amended to authorize additional
compensation for civilian intelligence officers and employees
of the military departments stationed outside the continental
United States or in Alaska at rates not to exceed those
authorized by 5 U.S.C. 5941(a). Such allowance shall be based
on living costs substantially higher than in the District of
Columbia or conditions of environment which differ from those
in the continental United States.
Subsection 1604(e) authorizes the Secretary of Defense to
delegate the authority contained in Subsection 10 U.S.C. 1604(a)
through (d) to the Secretaries of the military departments for
purposes of taking appropriate civilian personnel management
actions with respect to civilian intelligence officers and
employees of the military departments.
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Newly designated subsection (f) of section 1604 as amended
by 703(a) of the bill, authorizes the Secretary of Defense,
during fiscal years 1987 and 1988, to terminate employment of
any civilian intelligence officer or employee of the military
departments whenever he considers that action to be in the
interests of the United States and he determines that the
procedures prescribed in other provisions of law that authorize
the termination of such employment cannot be invoked in a
manner consistent with the national security. Termination
authority may be delegated only to the Secretaries of the
military departments. Termination action would be appealable
to the Secretary of Defense whose decision would be final.
Subsection (f) is designed to facilitate, while preserving
basic due process, the removal of personnel whose performance
or security suitability is demonstrably unsatisfactory or
unacceptable, or who are otherwise impairing the effective
performance of the military departments' intelligence mission.
The intelligence environment requires suitability and unusually
high standards of performance to ensure the accuracy and
reliability of intelligence product. Tolerance of
unsatisfactory performance or security suitability is
necessarily low. The flexibility granted by this provision
would relieve the military departments from the external public
review procedures to which preference eligible individuals
would otherwise be entitled upon appeal to the Merit Systems
Protection Board. The termination system instituted under
subsection (f) would provide strict safeguards to assure
internal appeal to the Secretary of Defense thereby ensuring
equity and consistency. The Secretary of Defense is required
to notify the intelligence committees of each instance in which
the termination authority is exercised. The termination
authority is limited in duration. It is so designed to provide
an opportunity to assess the use made of the authority during a
two year period in order that an informed decision can be made
as to whether the authority should be made permanent.
Section 704 clarifies and makes permanent statutory
authority for the Department of Defense, through the Defense
Mapping Agency (DMA), to conduct mapping activities in foreign
countries. Currently, DMA has 185 international executive
agreements with 75 countries concerning the exchange,
collection, and production of mapping data. Some of these
agreements have been in existence since the early 1940's.
Specifically, these agreements permit (1) the exchange of maps,
charts and other geodesic information, (2) co-production and
collection of mapping data, (3) loan of DMA equipment, such as
gravimeters and doppler satellite tracking gear, so that
foreign mapping agencies can produce raw data more efficiently
and accurately, (4) training in equipment use by DMA of foreign
personnel, and (5) access to foreign countries, either directly
by DMA or through surrogate countries.
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DMA finds it necessary to deal with foreign map agencies to
the extent that overhead systems cannot provide accurate
cartographic data. To fill the gap, DMA will send a team to do
what is required to map that area. However, the cost of
sending U.S. personnel has been prohibitive; it is far less
expensive to use local foreign mapping agencies. When local
mapping personnel are used, the U.S. sends them the specialized
equipment and provides the necessary training as set forth in
the executive agreement.
Therefore, the U.S. saves a good deal of money by the use
of foreign locals rather than sending U.S. persons to do the
job. In the exchange, the U.S. gets significant raw mapping
data as well as access to the territory of another
sovereignty. Some executive agreements even provide for the
acquisition of new mapping data through surrogate countries.
Over the years this has been a low cost, reliable and
convenient way for DMA to fulfill its intelligence mandate.
It should also be emphasized that in many instances that this
is the "only" way to get mapping data from foreign countries.
In addition to the substantial savings in using local foreign
personnel, it is estimated that the data and other materials
provieed to the United States through such agreements is valued
in excess of $80 million annually.
However, the authority of DMA to engage in such executive
agreements with other countries has been called into question.
Technically, DMA lacks explicit statutory authority to engage
in these, agreements. Currently it relies exclusively on
executive Constitutional authority as the basis for such
agreements. But changes in statutory law have introduced an
element of uncertainty in DMA's reliance on Constitutional
authority. Public law (P.L. 97-113) prohibits no-cost loan of
defense ( DMA ) equipment. In addition, both the Arms Export
Control Act and the Foreign Assistance Act require foreign
governments to reimburse the Defense Department for any foreign
training. Neither the cost avoidance of using foreign locals
over United States personnel, nor the $80 million valuation of
data provided by foreign countries is calculated as
reimbursement. In combination these laws render DMA's.
exclusive reliance on the Constitution as the legal basis for
these international executive agreements somewhat uncertain.
To remedy this uncertainty, DMA seeks limited statutory
authority to continue to exchange mapping data, supplies and
services with foreign countries.
Section 705 provides the Defense Intelligence Agency (DIA)
with authority to pay for necessary medical evacuations of DIA
civilian employees stationed overseas. Section 501 of the
Intelligence Authorization Act for FY84, P.L. 98-215, authorized
allowances and benefits for certain employees of DIA stationed
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overseas comparable to those provided to officers and employees
of the Foreign Service serving overseas. However, the
authority to pay the costs or expenses incurred for a medical
evacuation of a civilian employee when there is no suitable
person or facility in the overseas locality to provide the
necessary medical care was not included in the list of benefits
provided by section 501. This authority was reenacted as
Section 1605 of Title 1.0 by subsection (a) of Section 1302 of
the Department of Defense Authorization Act, 1986, P.L. 99-45,
but the medical evacuation authority was again omitted. This
authority is not only currently available to Foreign Service
officers and employees, but also to CIA and NSA civilian
employees (see section 4 of the CIA Act of 1949, 50 U.S.C.
403(e) and paragraph 9(b)(1) of the National Security Agency
Act of 1959, 50 U.S.C. 402 note, respectively). While it is
fortunate that there is rarely the need to have such an
authority, DIA has experienced necessary medical evacuations of
its civilian employees stationed overseas. Should similar
circumstances arise in the future, payment for medical
evacuation of DIA civilian employees should be handled on the
same basis as for other civilian intelligence and diplomatic
employees similarly situated.
Section 706(a) amends chapter 57 of title 10, United States
Code, to authorize members of the armed forces to accept cash
awards for exceptional performance of duty while engaged in the
collection or reporting of sensitive foreign intelligence
information. Under the Intelligence Exceptional Collector
National HUMINT Award Program established by the Director of
Central Intelligence Community in March 1985, each component of
the Intelligence Community is authorized to nominate military
or civilian personnel (a maximum of four each fiscal year)
whose achievements constitute either extraordinary intelligence
reporting or particularly fruitful collection activities
directly affecting United States national security policy.
Nominees approved by the Director of the Intelligence Community
Staff and the Director of Central Intelligence may receive
awards of up to $5000.
Section 5536 of title 5, United States Code, prohibits
Federal civilian employees or military personnel from accepting
additional pay or allowances for performing their official
duties unless the disbursement is specifically authorized by
law. Section 4503(2) of title 5, United States Code, provides
the authority to make incentive awards to civilian employees
who perform special acts or services in connection with their
official employment. In contrast, cash awards to military
personnel are limited to those recognizing individuals whose
"suggestion, invention or scientific achievement contributes to
the efficiency, economy or other improvement of operations or
programs relating to the armed forces." (10 U.S.C. 1124(a)).
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Thus, under existing law, civilian employees may accept cash
awards under the Intelligence Community Exceptional Collector
National HUMINT Award Program, but military personnel may not.
Enactment of this proposal will eliminate the disparity in
treatment of civilian and military personnel engaged in the
collection and reporting of foreign intelligence.
Subsection 706 (b) authorizes payment of cash awards for
achievements while on active duty in the armed forces even if
the member dies, separates or retires before approval of the
award.
RESTRICTIONS ON ASSISTANCE TO FOREIGN POWERS
BY FORMER INTELLIGENCE OFFICERS OR EMPLOYEES
Section 801 would amend the National Security Act of 1947
to prohibit former officers and employees of the U.S.
Intelligence Community from assisting foreign powers in certain
circumstances without approval.
I. Purpose of Legislation
The purpose of this legislation is to preserve and promote
the integrity of former members of the United States
Intelligence Community, to maintain and enhance the confidence
of the public in the Intelligence Community, to avoid real and
apparent conflict of interest and to protect intelligence-
related information from disclosure.
This bill would amend the National Security Act of 1947 as
follows:
a. Employees within the Intelligence Community
would be barred for a period of two years from
directly or indirectly accepting employment, entering
into any advisory, financial or other relationship
with a designated foreign power without written
approval to do so; or providing guidance, advice or
information concerning intelligence, or information
derived from or directly related to an officer's or
employee's former position within the Intelligence
Community to a designated foreign power without
written approval to do so;
b. Heads of departments or agencies could exempt
classes of employees from this prohibition;
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c. Nonexempt employees would be required to seek
approval from their former employing agency, and the
head of the agency could in his or her discretion
approve or disapprove such application;
d. Employees who had been granted approval to enter
into such arrangements would have a continuing duty to
inform their former agency of their status with the
foreign power;
e. This title would provide for criminal penalties
of not more than $10,000, or imprisonment for no
greater than two years for violation of the Act's
provisions;
f. This title would also provide foe injunctive
relief to compel former employees to comply with
its provisions.
g. Each agency within the Intelligence Community
would be required to promulgate regulations to
carry out the provisions of the Act;
h. This title would have extraterritorial
jurisdiction;
i. For the purpose of this title, a designated
foreign power is defined to include all foreign
countries, foreign political parties, all govern-
ments in exile and would include any quasi-
governmental, international or multinational
organization.
II. Need for Legislation
Existing conflict of interest statutes, post-employment
restrictions, espionage statutes and contractual secrecy
agreements binding members of the intelligence community fail
to provide adequate safeguards to insure that former officers
and employees of the intelligence community do not enter into
damaging relationships with foreign powers. The post-
employment restrictions found in 18 U.S.C. 207 merely prohibit
a former employee from taking a representational role on behalf
of another in regard to specific matters in which he, or
employees under his supervision, had personal and substantial
involvement as a government employee. Although the espionage
statutes prohibit the unauthorized disclosure of classified
information, they do not prohibit relationships which might
lead to the disclosure of information, nor do they prohibit the
disclosure of unclassified, yet sensitive and damaging
information. Contractual secrecy agreements with former
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employees require only that employees submit materials for
prepublication review, and at best provide for relief under
principles of contract law. As a result, former employees of
the intelligence community are free to enter into employment
and advisory relationships with real or potential hostile
powers, and, if they are willing to risk uncertain civil
penalties, share unclassified yet non-public and sensitive
intelligence information with hostile powers, and trade in
intelligence-related professions when it is not in the interest
of the United States for them to do so.
Recent incidents evidence a need for remedial legislation:
- Former intelligence employees Edwin Wilson and Frank
Terpil established consulting and commercial relationships with
hostile governments shortly after their departure from the
government. In both cases, they apparently gained their
initial footholds on the basis of their recent employment by
United States Intelligence
- A former CIA analyst served as an "expert witness"
before the world Court, supporting the Nicaraguan Government's
claim against the United States. His testimony was carefully
crafted to exclude references to classified information and
couched as "extemporaneous statements" to avoid prepublication
review.
- Two former members of the Army's Delta Force were
approached by representatives of a Honduran junta.to provide
security services. The two former officers were initially
unaware that the group represented a political faction which
was planning to assassinate the President of Honduras.
Although in this case the former officers were entirely
blameless, their apparent availability placed them in a
potentially compromising position.
In each of these cases, a temporary bar on employment or
advisory relationships with foreign powers could have delayed
or possibly thwarted potentially damaging relationships. At
the minimum, this legislation would assure the public that such
relationships should not exist in the future, and thus enhance
public faith in government.
a. Need for a Two-Year Ban
Intelligence information, both raw intelligence and
information concerning intelligence methodologies, has both a
temporary and long-term value. This bill attempts to minimize
the potential harm to the United States while minimizing the
intrusion into the post-employment activities of former
intelligence officers by addressing the temporary component.
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we believe that it is necessary to place controls on the
trafficking of information and skills of immediate value for
purposes of obtaining employment or financial gain with a
foreign power. Accordingly, although the bill would permit
former employees to eventually seek employment with or
establish relationships with foreign powers, situations which
present the potential for the most serious damage would be
subject to approval and control.
From the viewpoint of an employee who plans to establish a
benign or positive relationship with a foreign power, the bill
would create only a minor intrusion into his private affairs,
requiring approval for only a two-year period.
b. Need for Exemptions for Classes of Employees
The bill is intended to restrict the post-employment
activities of employees whose particular skills or access to
information could be exploited by hostile governments. It is
likely, however, that some classes of employees of the
Intelligence Community would pose no current or potential
threat to the national interest. In order to avoid an
unnecessary and unwarranted restriction on the post-employment
activities of these employees, and to avoid clogging the
approval mechanism with unnecessary paperwork, we believe that
the legislation should permit exemption of classes of
employees, and that a decision to waive the reporting
requirements should be left to the discretion of each agency
head.
c. Need for Discretionary Authority to Approve or
Disapprove Requests
Absolute discretionary authority to approve or disapprove
requests is an essential element of this legislation. Because
of the temporal value of relationships based on former
intelligence service, agencies must have the authority to bar
such relationships, free from the prospect of delay arising out
of administrative appeal and judicial review. Decisions as to
what relationships might constitute dangers to the national
security are properly left to the heads of intelligence
agencies who have access to, and knowledge of, information
concerning the potential threat powed by the employment under
consideration, the details of the employee's. duties and access
to information, and an appreciation and understanding of how
the two interrelate. Just as intelligence heads have the sole
discretion to identify intelligence sources (see, U.S. vs Sims)
it is essential that they have the non reviewable authority to
identify and bar potential threats to those intelligence
sources and methods.
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d. Need for Continuing Duty to Report
Because a change in the specific activities of an
individual, or a change in scope of his activities could affect
the determination as to whether a relationship poses a threat
to the Intelligence Community, former employees must have an
obligation to report material changes in the circumstances
surrounding their relationship with a foreign power. In order
to insure timely transmittal of this information, these reports
must be made promptly.
Penalties and Injunctive Relief
Because relationships with foreign powers offer significant
financial rewards, and because certain relationships may result
in serious damage to the national security, civil damages would
be ineffective and inappropriate for viplations of the bill's
approval and reporting requirements. However, because damage
once done could not be repaired, we also see a need for
injunctive relief to enjoin a former employee from entering
into non-approved relationships. We also see a need for civil
remedies to provide a means to both obtain information and to
provide a mechanism to assure that the statute is carried out
as written.
f. Need for Extraterritorial Jurisdiction
By their very nature, relationships with foreign powers are
likely to have been created and maintained outside of the
territory of the United States. Extraterritorial jurisdiction
is necessary to reach the majority of acts which the
legislation seeks to control.
Section-by-Section Analysis
Subsection 801(a) establishes a new requirement for
employees of the Intelligence Community to obtain approvals to
engage in certain activities during the first two years
following their separation from an agency within the
Intelligence Community. A former employee would be required to
seek advance approval before directly or indirectly entering
into the following:
Employment with a foreign power, an advisory
relationship with a foreign power, a financial
relationship with a foreign power; or;
providing aid, services or assistance to a foreign
power, or;
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providing guidance, assistance or information to a
foreign power concerning intelligence, or information
derived from or directly related to his former
position within the Intelligence Community.
Under this section, former employees would be required to
seek advance approval before they negotiated for employment
with a foreign power, before supplying any consultative
services to a foreign power, or before serving as a paid or
unpaid spokesman or witness for a foreign power.
Subsection (b) exempts officers or employees of the
government who act in the course of their official duties.
Subsection (c) authorizes each head of an intelligence
agency to waive the provisions. of subsection (a) for any
particular person or class of persons. The agency head's
actions are discretionary and nonreviewable.
Subsection 802(a) establishes the requirement to seek prior
approval to enter into relationships or engage in activities
otherwise prohibited by section 801. Section 802(a) defines
the reporting requirement and sets forth the minimum
information required to be included in a request for approval.
Subsection (b) establishes the criteria for approval: that
an activity will not involve the unauthorized disclosure or use
of classified information and that it will not be inconsistent
with national security. The authority to approve is
discretionary with the agency head, not reviewable, not
appealable.
Subsection (c) states that approval to engage in an
activity does not affect any potential civil or criminal
liability. Accordingly, application of the conflict of
interest statutes, 18 U.S.C 201-209 is not affected, nor are
secrecy agreements between the government and its former
employees.
Section 803(a) establishes a continuing duty to report for
each year during which a financial relationship or activity
continues. This duty to report extends only through the first
two-year period following separation from the intelligence
community.
Subsection (b) establishes a duty to report material
changes in the circumstances affecting the relationship or
activity and requires former employees to file such reports
within 10 days of the occurrence of a change in circumstances.
On review of the updated report, the head of the agency
involved may require the former employee to reapply for
approval to engage in the relationship or activity. If the
head of the agency declines to approve the activity, the
employee must terminate the activity within 10 days.
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Subsection (c) establishes the requirement to file a
termination report within 30 days of the termination of a
financial relationship or activity. Subsection (d) sets forth
the authority of the agency head to require employees to
provide additional information to permit him to carry out the.
provisions of the bill.
Subsection 804(a) defines a continuing offense for failure
to file reports required by section 803.
Subsection (b) defines as unlawful the making of false, or
untrue statements or the omission of material facts.
Subsection (c) defines as unlawful the omission of required
information.
Subsection 805(a) establishes criminal penalties for
willful violations of sections 801, 802(a), 803, and 804. This
subsection permits a defendant to claim as a defense that he
had no actual knowledge of the bill's requirements.
Subsection (b) sets forth jurisdiction in the district
courts for injunctive relief to require compliance with the
bill's reporting requirements or compliance with any of the
bill's other provisions. The intent of this section is to
permit the district court to enjoin a former employee from
entering into or continuing.an unapproved activity.
Proceedings under this subsection will be expedited by the
court.
Section 806 requires the various agencies to issue
regulations to carry out the provisions of the bill.
Section 807 establishes extraterritorial jurisdiction.
Jurisdiction is conferred on the district court over citizens
and permanent resident aliens.
Section 808 provides definitions. For the purpose of the
bill, "intelligence agency" includes executive intelligence
agencies, and the Senate Select Committee on Intelligence
(SSCI) and House Permanent Select Committee on Intelligence
(HPSCI). The term "designated foreign power" is defined to
include foreign governments, all political subdivisions of such
governments, political parties of foreign governments,
governments in exile, international or multinational
organizations composed of foreign governments, or an agent or
representative of a foreign government.
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UNAUTHORIZED DISCLOSURES OF CLASSIFIED INFORMATION
Section 901 adds a new section to the National Security Act
of 1947 (50 U.S.C. 401 et seq.) prohibiting certain unauthorized
disclosures of classified information.
Proposed Section 901 provides criminal penalties for
willful unauthorized disclosure of classified information by
current or former federal employees and others, such as
government contractors, who have or have had authorized access
to classified information. With the narrow exceptions of
unauthorized disclosures of atomic energy Restricted Data,
communications intelligence and cryptography information, and
the identities of covert agents, willful unauthorized
disclosures of classified information by those entrusted with
it by the government are not per se offenses under existing
federal criminal statutes.
Subsection (a) of 901 prohibits willful disclosure or
attempted disclosure of classified information, by a federal
civilian or military officer or employee or other person with
authorized access to such information, to any person who is
neither a federal civilian or military officer or employee nor
a person with authorized access to such information. The
subsection provides criminal penalties of not more than five
years imprisonment or a $25,000 fine, or both, for each
violation.
Subsection (a) also prohibits unauthorized disclosures by
persons who previously have been officers or.employees of the
United States, and to persons who have had authorized access to
classified information. This retroactive feature is important
to ensure that criminal liability under the proposed section is
not evade6by an individual who begins to make unauthorized
disclosures after government service or authorized access has
ceased.
Subsection (b) of 901 applies to a current or former
federal civilian or military officer or employee, and to any
other person who has or has had authorized access to classified
information, who aids or abets another such person in the
unauthorized disclosure of the information, directly or
indirectly such as through a chain of intermediaries, to a
person who is neither a federal civilian or military officer or
employee, nor a person with authorized access to the classified
information. The criminal penalties for such an offense are
identical to those provided for the offense defined in
subsection (a).
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Subsection (c) of 901 provides definitions for terms
employed in subsections (a) and (b). Subparagraph (i) defines
"classified information" to consist of information or material
that has been determined by the United States Government to
require protection against unauthorized disclosure for reasons
of national security pursuant to a statute, Executive Order, or
litigation. It is intended that prosecutions would be barred
unless a person has clear notice or reason to believe the
information disclosed was classified. Subparagraph (ii)
defines the term "disclose," or "discloses," to include all
forms of disclosure enumerated in the existing provisions of 18
U.S.C. 793-798 and 50 U.S.C. 426, 783. Subparagraph (iii)
defines the term "authorized access" to include authority or
permission to receive information within the scope of
authorized government activities or pursuant to the routine
security clearance processes of the Executive 'branch, orders of
the courts of the United States, or rules of either House of
Congress.
Subsection (d) of 901 assures that no criminal liability
will attach under subsections (a) or (b) to otherwise lawful
disclosures of classified information to the Congress or the
courts.
Subsection (e) (i) assures that no criminal liability will
attach when the information previously has been disclosed
publicly by U.S. government officials authorized to do so.
Subsection (e) (ii) further permits a defendant to assert as a
defense that the information disclosed was not information that
was obtained as a result of employment or to which he or she
had authorized access as defined in the bill. Subsection (e)
(iii) allows a defendant to assert as a defense the good faith
publication based upon prior U.S. Government review of the
information pursuant to a request from the defendant for
prepublication or declassification review. Prosecution would
be barred if the defendant has submitted the information for
review, pursuant to an express agreement providing for
prepublication review or otherwise, and has been notified by
the Government that is has no objection to the disclosure or
declassification on national security grounds, or if the U.S.
objection or denial of declassification has been overturned by
a federal court decision that is final.
Subsection (f) is designed to ensure that no prosecutions
may occur unless the Attorney General and the head of the
department or agency with responsibility for the classified
information concerned have certified that the information
disclosed constitutes properly classified information. Such
certifications shall be final and unreviewable, and shall be
conclusive indication that the information constitutes
information that properly meets the criteria for a specific
level of classification under statute or Executive Order.
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However, a defendant may challenge the propriety of the
classification by showing that the information was available
and obtained from public sources prior to the defendant's
disclosure. In such cases, the United States shall be provided
an opportunity to establish that the information nevertheless
remained properly classified despite its availability from
public sources, because it had not been officially disclosed or
confirmed by the United States. A defendant also may challenge
the classification by making a prima facie showing, based upon
personal knowledge or otherwise admissible evidence, that the
information was improperly classified by the U.S. at the time
of the defendant's disclosure because it did not meet the
substantive criteria for classification called for by
applicable statute, order, or directive. It is intended by
this subsection that, upon the requisite showing by a
defendant, the United States shall justify the propriety of the
classification, in camera ex parte, by showing the damage that,
at the time of the defendant's disclosure, reasonably could be
expected from disclosure. Thus, a prosecution could not be
maintained under this section if a defendant discloses certain
information that is available from public sources because of a
prior unauthorized disclosure, unless the United States can
establish that, at the time of the disclosure, the additional
disclosure of the information or confirmation by a person with
authorized access reasonably could be expected to cause damage
to the national security. Further, no prosecution could be
maintained if, after a prima facie showing by the defendant
that classification was arbitrary or otherwise improper, the
court rules in defendant's favor. Finally, the provision for
in camera, ex parte consideration of the propriety of the
classification is intended to permit the court to determine the
issue without exposing additional classified information to
persons not authorized to have access to such information.
It is intended that the court's examination on the matter shall
be de novo in accordance with the standards for review
established under the Freedom of Information Act. The court's
determination on this issue is to be conclusive on the
propriety of the classification, and is a matter of law.
Subsection (g) provides the United States the right to an
interlocutory appeal from any adverse ruling by the court on
the propriety of the classification. This provision enables
the issue to be resolved before submitting the case to trial,
and parallels the provision for interlocutory appeal contained
in the Classified Information Procedures Act. It is intended,
moreover, that the provisions of that Act also will be
available to ensure the protection of classified information
from unauthorized disclosure.
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Subsection (h) provides that prosecutions may be commenced
even if the disclosure that provides the basis for prosecution
under the bill is made outside the territorial jurisdiction of
the United States.
GENERAL PROVISIONS
Section 1001 makes clear that, with the exception of any
specific legislative authorities which may be contained in the
Intelligence Authorization Act for Fiscal Year 1986, the Act is
intended only to authorize appropriations and does not
constitute authority for the conduct of any intelligence
activity prohibited by the Constitution or laws of the United
States.
Section 1002 authorizes the increase of appropriations
authorized by the Act for salary, pay retirement, and other
benefits for federal employees as necessary for increases in
such benefits authorized by law.
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