SEMIANNUAL REPORT TO THE DIRECTOR, CENTRAL INTELLIGENCE AGENCY

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 0005494985
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 62
• Document Creation Date: June 24, 2015
• Document Release Date: April 14, 2011
• Case Number: F-2007-00194
• Publication Date: July 13, 2006

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Central Intelligence Agency
Inspector General
SEMIANNUAL REPORT
TO THE DIRECTOR, CENTRAL INTELLIGENCE AGENCY
JANUARY - JUNE 2006
APPROVED FOR RELEASED
DATE: 25-Feb-2010
John L. Helgerson
Inspector General
Copy
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 TABLE OF CONTENTS
PAGE
(U) A MESSAGE FROM THE INSPECTOR GENERAL ................1
(U) STATUTORY REQUIREMENTS ................................................. 5
(U) AUDITS .............................................................................................. 7
(U) AUDIT STAFF OVERVIEW ........................................................... 7
(U) COMPLETED AUDITS .................................................................. 8
(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS
OUTSTANDING FROM PREVIOUS SEMIANNUAL REPORTS .....16
(U) SUMMARIES OF SELECTED CURRENT AUDITS .......................... 27
(U) INSPECTIONS ................................................................................. 29
(U) INSPECTION STAFF OVERVIEW .................................................. 29
(U) COMPLETED INSPECTIONS ......................................................... 30
(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS
OUTSTANDING FROM PREVIOUS SEMIANNUAL REPORTS ..... 36
(U) SUMMARIES OF CURRENT INSPECTIONS .................................. 39
(U) INVESTIGATIONS .........................................................................41
(U) INVESTIGATIONS STAFF OVERVIEW ......................................... 41
(U) COMPLETED INVESTIGATIONS .................................................. 43
(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS
OUTSTANDING FROM PREVIOUS SEMIANNUAL REPORTS ..... 44
(U) SPECIAL REVIEWS .........................................................................47
(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS
OUTSTANDING FROM PREVIOUS SEMIANNUAL REPORTS ..... 47
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 (U) ANNEX SECTION
(U) STATISTICAL OVERVIEW
(U) COMPLETED AUDITS
(U) CURRENT AUDITS
(U) COMPLETED INSPECTIONS
(U) CURRENT INSPECTIONS
(U) COMPLETED INVESTIGATIONS
(U) CURRENT INVESTIGATIONS
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(U) A Message From the
Inspector General
(U The Office of Inspector General
(OIG) during t is reporting period has been
investigating several cases involving allegations of
contract fraud, acceptance of gratuities, conflicts of
interest, theft of US Government funds, and
management misconduct. A substantial number of
OIG investigators and auditors are involved with
this work, which is being undertaken in
coordination with counterparts from other Federal
investigative agencies and Department of Justice
(DoJ) prosecutors. The IG has found his authority to issue subpoenas to be
especially helpful in the conduct of these investigations.
OIG also continues to devote substantial resources to
reviewing the Agency's detention and interrogation activities associated
with the conflicts in Iraq and Afghanistan. This work, undertaken with the
cooperation of the Departments of Justice and Defense, as appropriate,
focuses on the circumstances surrounding the movement, confinement, and
in some cases, abuse or death of detainees.
Notable developments have occurred related to s eci 'c
cases involving deaths of detainees.
Ina case, a Federal District Judge has
scheduled for August 2006, the trial of a former Agency contractor indicted
on four felony counts of assault of a detainee in Afghanistan, who died.
Finally the Investigations Staff is nearing completion of a
report of investigation concerning the actions of CIA personnel associated
with events surrounding the death of a former Iraqi Major General while in
custody of the US military in Iraq. The investigation found that CIA
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personnel were not involved in the specific actions that directly caused the
General's death,
During this reporting period, the OIG completed audits of
covert action programs
More broadly, the Office continues to be current in meeting the standing
request of the Congress that OIG audit each covert action program no less
frequently than every three years. In total, three such audits were completed
during this period, and another is underway.
(114 Investigations were also conducted on a number of other
subjects including child pornography, misappropriation of funds,
misconduct, firearms violations, false claims, and false statements. It is
noteworthy that of the 21 investigations completed during this reporting
period, a majority did not find substantiation to the allegations.
(U/= The initiative launched by OIG in 2005 to provide more
oversight of the effectiveness of project management throughout the Agency
resulted, during this period, in the publication of an audit report evaluating
Management has concurred with the several
recommendations and is taking steps to implement them. In the information
technology area, the Office completed its annual review of the security of the
Agency's information systems as required by the Federal Information
Security Management Act.
In June, the Office published a comprehensive inspection
report o Whereas inspections
normally address a single component or program, this effort documented
and assessed the success of the Agency's aggregate performance
over the period of the past four years.
Overall, OIG found that the Agency has
demonstrably improved its performance, but offered a number of
recommendations aimed at strengthening corporate awareness and
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decisionmaking
OIG continued its outreach to counterpart organizations
throughout Intelligence Community. The Inspector General for the
Office of the Director of National Intelligence and members of his staff, as
well as inspectors from the Defense Intelligence Agency and the National
Security Agency, participated in OIG's New Inspector Training Course.
The Deputy Assistant IGfor Inspections participated as the CIA
representative in a joint inspection, led by the National Reconnaissance
Office OIG, OIG's Audit Staff
organized and hosted the 12th Annual Intelligence Community Audit
Conference, attended by 150 auditors representing 14 Intelligence
Community agencies.
/s!
John L. Helgerson
13 July 2006
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(U) STATUTORY REQUIREMENTS
(U) This report is submitted pursuant to section 17 of the CIA
Act of 1949, as amended, which requires the Inspector General to
provide to the Director, CIA, not later than 31 January and 31 July of
each year, a semiannual report summarizing the activities of the OIG
for the immediately preceding six-month periods, ending
31 December and 30 June, respectively.
(U) All audit activities of the OIG are carried out in accordance
with generally accepted government auditing standards. All OIG
inspection and investigation activities conform to standards
promulgated by the President's Council on Integrity and Efficiency.
(U) The OIG has had full and direct access to all Agency
information relevant to the performance of its duties.
(U) Subpoena Authority
(U/[:::::) During this reporting period, the IG issuedu
subpoenas to contractors of the Agency. These subpoenas were
issued in the course of an investigation into allegations of bribery
involving a subcontractor. The IG also issued subpoenas to the
offices of two private corporations. These subpoenas were issued in
furtherance of an investigation of allegations of bribery involving a
senior Agency official.
(U) Legislative Proposals
(U) OIG has no proposals for legislative changes.
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(U) AUDITS
(U) AUDIT STAFF OVERVIEW
(U The Audit Staff conducts performance and
financial statement audits of Agency programs and activities, and
participates with other agencies in joint reviews of Intelligence
Community programs and activities. During this period, the Audit
Staff completed 11 audits that addressed project management, covert
action, financial management, information technology, and field
stations.
(U~ The Audit Staff completed the second audit that is
part of an initiative started during 2005 to provide more oversight of
the effectiveness of project management throughout the Agency. The
audit evaluated
While management
requested the first audit in this area, the Staff initiated, planned and
performed this audit, focusing efforts on both project management
and the major system acquisition process. The Staff is currently
performing an audit of another majo~program and is planning
additional audits that will concentrate on project management.
(U~~ The Audit Staff also continues to pursue its
program, as requested by Congress, to audit each covert action (CA)
program (or an aspect of each program) at least every third year. The
Staff completed audits of three CA programs during the reporting
period, and is currently performing an audit of a fourth. In the
information technology area, the Staff completed the annual review
of the security of the Agency's information systems as required by
the Federal Information Security Management Act. Currently, the
Staff is performing audits of the Agency's Information Security
Practices in the Field, the Corporate Information Retrieval and
Storage System, and the Information Operations Network. As
required by the Accountability of Tax Dollars Act of 2002, the Staff is
also performing the annual independent audit of CIA's financial
statements.
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(U) In May 2006, the Audit Staff hosted the 12thannual
Intelligence Community Audit Conference. The theme of the
Conference was "The Intelligence Community Serving the Nation at
Home and Abroad." Over 150 auditors attended the Conference
from 14 Intelligence Community agencies, including CIA. The
program included speakers from the Office of the Director of
National Intelligence (ODNI) and the Department of Defense Offices
of Inspectors General, the National Counterproliferation Center, the
National Counterterrorist Center, and the National Geospatial-
Intelligence Agency.
(U) COMPLETED AUDITS
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(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS OUTSTANDING
FROM PREVIOUS SEMIANNUAL REPORTS
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(U) SUMMARIES OF SELECTED CURRENT AUDITS
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(U) INSPECTIONS
(U) INSPECTION STAFF OVERVIEW
(U The Inspection Staff is responsible for conducting
inspections of CIA programs and operations to evaluate their
efficiency and effectiveness and their compliance with law, Executive
orders, and regulations.
(U During the current reporting period, the Staff
completed inspections of
the Office of Near East and South Asian Analysis (NESA) in the
Directorate of Intelligence (DI), and the Office of Information
Management Services (IMS) in the Directorate of Support (DS). In
addition, the Staff continued its inspections of the CIA
CounterTerrorism Center (CTC) in the National Clandestine Service
(NCS)E:::::: and commenced
inspections of the Counterintelligence Center (CIC) in the NCS, the
DI's
in the Directorate of Science and Technology (DS&T), the
and the Agency's Reliance on
Contractors.
( The Inspection Staff continues to conduct a two-
week course for new inspectors and a seminar for team leaders before
the start of each inspection cycle. The Staff also provides
instructional seminars for OIG inspectors and research assistants
during the course of each cycle, instituted in response to the
increasing sophistication of the Staff's methodology.
( In addition, the Inspection Staff continues to
utilize an independent contractor to track, monitor, and pursue
compliance with recommendations. The Staff closed three
inspections-the CIA Crime and Narcotics Center, the Office of
Public Affairs, and the DCI Operations Center-that were open as of
1 January 2006.
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(U) COMPLETED INSPECTIONS
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(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS OUTSTANDING
FROM PREVIOUS SEMIANNUAL REPORTS
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(U) SUMMARIES OF CURRENT INSPECTIONS
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(U) INVESTIGATIONS
(U) INVESTIGATIONS STAFF OVERVIEW
(U The Investigations Staff investigates possible
violations of statutes, regulations, policies, and procedures, as well as
allegations of waste, fraud, mismanagement, abuse of authority, and
substantial dangers to public health and safety related to Agency
programs and operations. The Staff oversees the Agency's grievance
system and conducts initiatives aimed at detecting and preventing
fraud, waste, and abuse.
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(U~ The Staff conducted a range of other
investigations, including allegations of fraud by employees and
contractors, possession of child pornography, unauthorized
shipments of firearms, misappropriation of funds, and false
statements and claims. Judicial proceedings are underway in several
cases. The Staff, additionally, tracks the progress by Agency
components in fulfilling outstanding recommendations from
completed investigations.
(UAs a result of Staff investigations, three matters
were referred to the DoJ for potential prosecution. In separate
matters, the Agency held three employee Personnel Evaluation
Boards as a result of OIG investigations. Two investigations
involving time and attendance and one involving false operational
accountings resulted in repayment to the Agency. The
Staff also issued three Employee Bulletins to the Agency work force
to inform them of the outcomes and serious consequences of several
investigations concerning the illegal shipment of firearms and false
claims and false statements.
(U~ As the Staff's workload continues to expand, Staff
recruitment remains a priority. Internal recruiting efforts are
underway to hire up to three new investigators. Two individuals
with Federal law enforcement experience joined the Staff, and four
.others are in process for employment this year.
( Advancing the information technology arena
remains an equally critical priority for the Staff. Progress has been
made; software has been identified and is being deployed to improve
the organization and search capability of voluminous records
received in the course of investigations. Efforts in this critical arena
will continue.
(U) The Staff continues to oversee the Agency-wide
grievance system, which seeks to resolve grievances at the lowest
possible level in the organization. In addition to sponsoring a yearly
grievance counselor workshop for component and directorate
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grievance officers, the Staff hosts quarterly meetings of grievance
officers to share issues of common interest, and it conducts
mandatory training for all new grievance officers. This training,
together with the emphasis on resolution at the lowest possible level,
continues to contribute to effective and timely grievance resolution.
(U) COMPLETED INVESTIGATIONS
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(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS OUTSTANDING
FROM PREVIOUS SEMIANNUAL REPORTS
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(U) SPECIAL REVIEWS
(USpecial reviews are undertaken by ad hoc teams
under the leadership of a senior OIG officer to address issues of
special concern identified by the Congress, senior CIA leaders, or the
Inspector General.
(U) STATUS OF SIGNIFICANT RECOMMENDED ACTIONS OUTSTANDING
FROM PREVIOUS SEMIANNUAL REPORTS
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(U) STATISTICAL OVERVIEW
(U) Audit Staff
(U During the period 1 January to 30 June 2006, the
Audit Sta issue 11 reports and made 30 recommendations to
improve accounting and financial management, facilities
management, and general management.
(U/The Audit Staff had 18 audits and reviews
ongoing at the end of the reporting period.
(U) Inspection Staff
(U /E:::::) During. the first six months of 2006, the Inspection
Staff completed three inspections. At the end of the reporting period,
the Staff also had seven ongoing inspections. In addition, the Staff
closed three inspections.
(U) Investigations Staff
(U~ The Investigations Staff completed work on 130
matters of various types during this reporting period. Of this
number, 21 cases were of sufficient significance to be the subject of a
final report-3 Reports of Investigation and 18 Disposition
Memoranda.
(U During this period, the IG formally referred 3
matters to o ased upon a reasonable belief that violations of
Federal criminal law may have been committed.
(U~ Recoveries on behalf of the US Government
during this reporting period, as a result of the Investigations Staff's
efforts, totaled
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(U/Q As of 30 June 2006, 140 matters were in various
stages of review by the Investigations Staff.
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(U) COMPLETED AUDITS
1 January - 30 June 2006
(U) Information Technology
(U/ ~ 2005 Independent Evaluation of the Central
Intelligence Agency Information Security Program and
Practices Required by the Federal Information Security
Management Act (FISMA)
(U) Operations
(U) Procurement
(U) Field Activities
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(U) CURRENT AUDITS
30 June 2006
(U) Financial Management
(U/ A
Independent Auditor's Report on the Central
Intelligence Agency Fiscal Year 2006 Financial Statements
(U,_) Process for Obtaining Refunds or Credits for
Unused Airline Tickets
(U) Information Technology
(UA 2006 Independent Evaluation of the Central
Intelligence Agency Information Security Program and
Practices Required by the Federal Information Security
Management Act
(U/Corporate Information Retrieval and Storage
(CIRAS) System
(U/ Information Operations Network
(U) Operations
Congressionally Directed
Audit
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(U) Procurement
(U) Field Activities
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(U) COMPLETED INSPECTIONS
1 January - 30 June 2006
(U/Agency Performance
(Uc::~ Office of Near East and South Asian Analysis
(U Information Management Services
(U) CURRENT INSPECTIONS
30 June 2006
(U/
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CIA CounterTerrorism Center
Agency Performance
(U/ /FOUO) Counterintelligence Center
Agency Reliance on Contractors
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(U) COMPLETED INVESTIGATIONS
1 January - 30 June 2006
(U/
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Alleged Copyright Infringement
Potential Conflict of Interest
Alleged False Claims in Operational Accounting
False Claims and Statements
L Alleged Abuse of Authority
A
leged Contract Fraud
Time and Attendance (T&A) Fraud
* (U) These investigations resulted in a Disposition Memorandum rather than a Report of
Investigation.
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Time and Attendance Fraud
(U Allegation of Money Wasted to Configure Unused
Building
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Alleged Conflict of Interest
Y Alleged Improper Use of Intellectual Properties by
Possible Ethics Violation
Allegations of Fraud and Misconduct
Unapproved Outside Activities and Misuse of Position
Alleged Violation of Post-Employment Restriction
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(U) CURRENT INVESTIGATIONS
As of 30 June 2006
(U) Category
Number of cases
(U//FOLIO) Grievances
Assignment
5
Compensation
1
Other - Grievance
2
(U) Board Appeals
1
(U~
) General Investigations
Criminal and Prohibited Acts
Conflicts of Interest
6
Embezzlement
2
False Claims - Other
9
False Claims / Statements /Vouchers
7
False Claims - Time & Attendance
13
False Claims H
1
Firearms
Management and Supervision - Administrative
2
Megaprojects
4
Misconduct - Employee
5
Misconduct - Management
4
Obstruction of Justice
1
Procurement Fraud
18
Regulatory Violations
2
Retaliation
1
Theft/Misuse of Government Property
3
Waste
1
Other - Administrative /Criminal
33
Unsubstantiated Allegations
17
(Ul
~
Total Ongoing Cases 140
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