CIA ACCOUNTABILITY ACT - H.R. 3603

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90M00004R001100010009-6
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 27, 2016
• Document Release Date: December 5, 2011
• Sequence Number: 9
• Publication Date: December 8, 1987
• Content Type: LETTER

Declassified and Approved For Release 2011/12/05: CIA-RDP90M00004RO01100010009-6
..- ON E. PANETTA
16TH DISTRICT. CALIFORNIA
COMMITTEES
AGRICULTURE
CHAIRMAN
SUBCOMMITTEE ON DOMESTIC
MARKETING. CONSUMER RELATIONS.
AND NUTRITION
HOUSE ADMINISTRATION
CHAIRMAN
SUBCOMMITTEE ON PERSONNEL AND POLICE
SELECT COMMITTEE ON HUNGER
CHAIRMAN
TASK FORCE ON DOMESTIC HUNGER
QCongreof; of Me 'niteb itoteo
Joute of Aepregentatibeg
ntjington, MC 20515
December 8, 1987 rr00
CIA ACCOUNTABILITY ACT - H.R. 3603,'. fill
WASHINGTON OFFICE
339 CANNON HOUSE OFFICE BUILDING
WASHINGTON. DC 20515
J202)225-2861
DISTRICT OFFICES.
380 ALVARADO STREET
MONIEIIEY CA 93940
14081 649-3555
HOLLISTER. CA
14081 637-0500
SALINAS. CA
(408) 424. 2229
SAN LUIS OBISPO. CA
18051541-0143
Dear Colleague:- G
As you may know, I recently introduced the CIA Accountability Act,
H.R. 3603, in the House with thirty-three original cosponsors.
Senator John Glenn has introduced a similar proposal in the Senate.
Knowing of your interest in the intelligence oversight function of
Congress, I would be pleased to have you join me as a cosponsor of
this measure.
The recent report of the Iran-contra Committees has recommended that
Congressional oversight of the CIA should be strengthened by the
the report pointed out
acquisition of an audit staff. In addition,
that the CIA Inspector General did not have the necessary manpower and
resources to acquire key facts during the entire affair.
I believe my legislation provides solutions to both of these points by
giving the GAO authority to initiate and perform audits of the CIr
while safeguarding classified information from unauthorized
disclosure. Presently, the CIA is the only federal government agency
which has consistently refused to allow the GAO to examine its
activities arguing that it is accountable only to Congressional
intelligence committees. This bill carefully limits the manner by
which the GAO would obtain access to CIA personnel and records, and
will limit dissemination of the audit results to the Senate and House
Intelligence Committees as well as the Director of the CIA.
The CIA maintains its own internal watchdog, the Inspector General's
Office, to ensure that the agency remains true to its mission and
accounts properly for its funds. The Iran-Contra mess is proof that
we cannot be content with internal reviews alone. Self-audit is
justifiably subject to suspicion and distrust. GAO duty is to make
independent audits of federal agency operations and programs. This
legislation is intended to strengthen the GAO's ability to discharge
its functions as an investigative and auditing arm of the Congress.
GAO's unique ability to conduct such audits was recognized by the
House Select Committee To Investigate Covert Arms Transactions With
Iran when it borrowed GAO auditors to identify the money trail. Had
similar legislation been in place when the Select Committee began its
investigation then auditors would have been in place, cleared and
intimately familiar with the CIA's accounting systems and
administrative procedures.
This legislation has the support of GAO Comptroller General Charles O.
Bowsher. Mr. Bowsher recently revealed at a Senate hearing that the
National Security Agency and numerous military services have allowed
GAO auditors with top-secret clearances to review many of their
activities. With every other federal agency and department already
subject to audits of the GAO, the CIA remains alone inlitsnbelief that
GAO is not legally authorized to audit their agency.
this legislation, I believe that carefully controlled GAO audits of
the CIA will in no way compromise the CIA mission.
Enclosed is the text of my introductory statement and legislation. If
eafo jj oin-as6a,cosponsor,
you need additional information or would like
please let me know or call Gary Namm of my
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 Declassified and Approved For Release 2011/12/05: CIA-RDP90M00004RO01100010009-6
Uaiimad' sistss
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Vol. 133
PROCEEDINGS AND DEBATES OF THE 100 CONGRESS, FIRST SESSION
WASHINGTON, TUESDAY, :NOVEMBER 3, 1987 No. 175
House o
INTRODUCTION OF THE CIA
ACCOUNTABILITY ACT OF 1987
(Mr. PANETTA asked and was given
permission to address the House for 1
minute and to revise and extend his
remarks and include extraneous
matter.)
Mr. PANETTA. Mr. Speaker, I rise
today along with the support of 33
original cosponsors to introduce legis-
lation that will allow the U.S. General
Accounting Office [GAO] to audit the
books and records of the Central Intel-
ligence Agency (CIA]. The CIA Ac-
countability Act of 1987 is identical to
the measure introduced in the Senate
by Senator JOHN GI.cxN on July 1,
1987. This legislation will authorize
the U.S. General Accounting Office to
audit the records and activities of the
Central Intelligence Agency.
The CIA is the only Federal agency
whose files are not open to examina-
tion by the GAO. This is due in part to
legal restrictions and in part to the re-
fisal by CIA to open its books.
This legislation strikes a reasonable
balance between the need for secrecy
and the need for accountability in the
operations and financial activities of
the CIA It opens every CIA program
and activity to possible audit or eval-
uation. At the same time, our bill care-
fully limits the GAO personnel who
could be involved in CIA audits, the
methods by which the GAO could
obtain access to CIA personnel and
records, and the dissemination of the
audit results.
The Iran-Contra scandal and new re-
levations of CIA activities make it
clear that the CIA has sometimes
acted as if it is not subject to this Na-
tion's laws. But in a democracy, no
agency or individual is above the law.
The very foundation of our Constitu-
tion is a system of checks and bal-
ances. For example, a more active
audit of the National Security Council
expenditures may have revealed the
extraordinary activities of Oliver
North and saved this Nation some of
the embarrassment that was exposed
at the Iran-Contra. hearings.
Currently, the only method used to
ensure CIA accountability is the use of
internal reviews by the CIA's inspector
general. The Iran-Contra scandal
offers more than adequate evidence of
the inadequacy of this system. >;'rank-
ly. it's easy to conclude that we have
here a classic case of the fox guarding
the chickens.
Right now, there is no adequate way
for Congress. and the American tax-
payer to ensure that the CIA is carry-
ing out its activities legally or effec-
tively. The GAO performs this audit-
ing and evaluating function for Con-
gress throughout the executive branch
of the Government. It Is a highly com-
petent and strictly nonpartisan
agency. It is. the logical organization to
carry out this work.
The intelligence agencies have oper-
ated beyond congressional control for
too many years. I applaud the great
need for effective CIA oversight is so
evident. Our legislation clears the
path for full access authority for the
GAO to be given the teeth necessary
to conduct meaningful investigations
on our behalf. If Congress intends to
take its oversight responsibilities seri-
ously, then we must act to expand our
access to intelligence information. The
first step is to guarantee GAO such
access on behalf of the Congress and
the American taxpayer.
I urge my colleagues in the House to
support this legislation, and I submit
an analysis of the bill followed by the
bill in its entirety be printed in the
RacoRD.
ANALYSis or THE CIA Acco
or 1967 SacTION-BY-s5CTIO
SECTION 1
SILITY ACT
ALYSIS
Title and general description of the bill:
CIA ACCOUNTABILITY ACT Or 1981
HOUSE LEGISLATION
H.R. introduced November 3, 1987 by
Representative Leon Panetta with 33 origi-
nal cosponsors.
Official Tale.-Clarify and restate the
Comptroller General's authority to audit
the financial transactions and evaluate the
programs and activities of the CIA and for
other purposes.
SECTION 2
Section two of the bill would add a new
section (38231) to title 31. United States
code. which clarifies GAO's authority to
audit the financial transactions and to
evaluate the programs and activities of the
CIA. Subsection (1X1) provides that OAO
stall audit the financial transactions and
evaluate the programs and activities of the
CIA either on the Initiative of the Comp-
troller General or when requested by the
chairman or ranking minority member of
the Select Committee on Intelligence of the
Senate or the Permanent Select Committees
on intelligence of Me House of Representa-
tives.
The results of such audits may be dis-
closed only to the specified committees and
the CIA Director. Since the method GAO
uses to communicate the results of Its audits
varies, the section is drafted to restrict the
dissemination of GAO's findings, whether
through testimony, oral briefings, or writ-
ten reports. to only the named committees
and the CIA. The last sentence of subsec-
tion (b) makes clear, however, that neither
the provisions of subsection 716(e), title 31.
nor the on-site retention provisions of (dX2)
of this section, limit or restrict GAO's dis-
closure of source documents or information
to the specified committees of the Congress.
Subsection (c) provides that notwithstand-
ing any other provision of law GAO may in-
spect and copy any relevant books. records.
documents, property or any other informa-
tion, regardless of the medium used to
record the information, necessary to the
performance of the audit. GAO's access ex-
tends to any books, records, documents or
property which belong to, or is in the pos-
session of control of, the Agency regardless
of who was the original owner of such infor-
mation or property. The '(n)otwithstanding
any other provision of law' clause is includ-
ed to remove any potential restrictions on
GAO access to CIA information that may be
inferred from the various provision of the
Central Intelligence Act of 1949.
Nevertheless, subsection (c) limits the
Comptroller General's normal authority to
interview officers and employees of an
agency or department to obtain information
necessary to the performance of the audit.
Thus, where the President finds In writing
that access to certain officers and employ-
ees. would not be in the national interest.
the Comptroller General shall have no
access to such officers or employees. The
President's determination Is, however, non-
delegable, and he or she must provide the
specified committees and the Comptroller
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Representatives
that are not provided to the commit-
tee and the Congress by the CIA.
Last December, GAO Comptroller
General Charles Bowsher told Con-
gress that the GAO could not ade-
quately account for nearly $17 million
of the $27 million in humanitarian as-
sistance appropriated last year for the
Contras which was administered by
the State Department. The GAO
found that millions of dollars wound
up in offshore bank accounts in the
Bahamas and the Cayman Islands.
Such poor accountability to the Amer-
lean taxpayer in this and many other
programs can no longer be tolerated.
To date, the American people and the
Congress have no information on the
accounting of the $100 million Contra
aid program currently being adminis-
tered by the CIA.
The National Security Agency and
numerous military services regularly
permit GAO auditors with top-secret
clearances to review many of their
highly classified national security ac-
tivities including black box programs
such as highly secret weapons projects
and sensitive intelligence operations.
Also, the Intelligence Committees bor-
rowed GAO personnel to establish the
money trail in the early review of the
Iran-Contra mess. The legislation will
allow the GAO, which is a strictly
nonpartisan agency, to apply to the
CIA the same strict standards of fi-
nancial accountability and perform-
ance that it applies to other agencies.
This bill is carefully drafted to
ensure secret activities and classified
documents are not compromised. It
would allow the President to shield
specific employees from investigation,
but no written records could be kept
from GAO review. It is an approach
that insists on accountability while
recognizing the unique role of the
CIA.
By current law and with the specific
language of this measure, GAO's
review power is carefully limited in at
least six major ways to prevent
damage to CIA operations:
First. All GAO personnel must
obtain appropriate security clearances
from the CIA before they are granted
access to CIA info.
Second. CIA records are to be kept
in controlled locations by the CIA.
Third. All GAO documents created
as a result of an audit will receive
same security classification as original
document.
Fourth. GAO personnel will be sub-
ject to criminal prosecution for
breaches of security.
Fifth. Congressional requests for
GAO audit must come from the chair-
man or ranking member of the Select
Committee on Intelligence in Senate
or House.
Sixth. President can exempt any in-
dividual CIA officer or employee from
GAO access.
Even in an open society certain intel-
ligence matters must be protected but
so too must the intelligence communi-
work of the House Permanent Select ty begin to honor its commitment to
Committee on intelligence over the an open society by making available
years In reviewing the limited maters- its records and certain basic informa-
als provided to them from the CIA. tion necessary for Congress to carry
But the problem Is not the review. of out its intelligence oversight function.
the records provided to the Intelli- Today, we must not allow our own
gence Committee by the CIA but investigative arm, the GAO, to be so
rather ?'-- --'-'- 14 in rh? 'pin's constructed and hampered when the
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Similarly paragraphs (2). (3) and (4) make
conforming amendments to sections
3524(dX2) and 3524(e) to reflect this change
Subsection (b) adds a similar conforming
amendment to section 8(b) of the Control
Intelligence Act of .1949 to make absolutely
clear GAO's authority to audit.unvouchered
.O,. ,.-
cElt 3523
"(2) All workpapers of the Comptroller
General and all records and property of the
Central Intelligence Agency that the Comp.
troller General uses during an audit or eval-
uation under this section shall remain in fa-
cilities provided by the Central Intelligence
Agency. Procedures . established. by the
Oeneral with an explanation of the decl-
sioa.
The Comptroller General may enforce the
weess rights provided under this subsection
pursuant to the provisions of section 718(b)-
(d), title 31, United States Code.
Subsection (d) contains severs t~ sesuards
to protect the confidentiality of Agency ma-
terials and Information. Paragraph (1) di-:
acts the Comptroller General:' after con-,.
suiting with the. specified committees of
Congress. to establish procedures to protect
classified and other sensitive Information.
Paragraph- (2) requires the Comptroller
General to retain on site his workpapers
and records In suitable facilities provided by
the Agency. The only ' exceptions are the
rare occasions when Congress or its commit-
tees may need certain Information from
GAO's workpapers or where temporary re-
moval off-site Is heeded. for example, for in-
ternal review processes.
The Committee, however, expects off site
removals to be limited in numbers and
strictly controlled and accounted for under
the procedures established by the Comptrol-
ler General pursuant to paragraph (1) dl-
rects the Comptroller General, after con-
sulting with the specified committees of
Congress. to establish procedures to protect
classified and other sensitive information.
Paragraph (2) requires the Comptroller
General to retain on site his workpapers
and records in suitable facilities provided by
the Agency. The only exceptions are the
rare occasions when Congress or its commit-
tees may need certain information from
GAO's workpapers or where temporary re-
moval off-site is needed, for example, for in-
ternal review processes. The committee,
however, expects off-sites removal to be lim-
ited In numbers and strictly controlled and
apeovnieci fbr under, the procedures estab-
lished by the Comptroller General pursuant
to paragraph (1) of this subsection. In this
regard; GAO employees must mahitain the
same level of confidentiality for the records
of any:alien' as the agency Itself and are
also subject to the same statutory penalties
for unauthorised disclosure or use of an
agency record as the agency's employees.
Paragraph (3) provides that GAO employ-
ees are subject to CIA security reviews and
procedures. Such procedures should be simi-
lar to those applied by the CIA to employ-
ees of other establishments of the Govern-
ment. The Director is urged to expedite
GAO employees security clearances.
Paragraph (4) provides that the Comptrol-
ler General provide the CIA Director with
the names of the GAO employees who have
obtained a security clearance in carrying out
this section.
Subsection (f) is a savings provision added
to make clear that the authority contained
in this section Is in addition to other author-
ity of the Comptroller General to audit and
investigate. This subsection emphasizes that
section 3523a is not. to be construed to limit
the authority of the Comptroller General to
audit or investigate any other agency or de-
partment, including any agencies involved
in foreign or domestic intelligence or
counter-intelligence activities.
a6CrIO?N 3
Section 3 of the bill amends section 3524
of title 31. United States Code, to conform
section 3524 to GAO's audit of the un-
vouchered accounts of the CIA under see-
tion 3523a. Thus, Paragraph (1) adds an in-
troductory clause to section 3524(a) to pro-
vide that audits of the financial transac-
tions of the CIA. including those accounted
for only on the certificate of the Director.
CIA, such as expenditures made under the
authority of section 8(b) of the Central In-
telligence Agency Act of 1949, 50 U.S.C.
403(b). are subject to the provisions of sec-
tion 3523a of title 31, United States Code.
a
ss
accounts wider new,
(1) of this subsection shall include provi?
tion (c) conforms f3AO's authority td en- stuns specifying the method and duration of
force its access to- CIA records to changes to re, removal of worl:papers from
m
o
ry
p
any
facilities provided by the Central InteW-
gence Agenayc
"(3) Before initiating an audit or evalua-
A bill to clarify and restate the Comptroller
General's authority to audit-the financial
transactions and - evaluate the programs
and activities of the Central Intelligence
Agency. and for other purposes.
Be a enacted by the Senate and House of
Reyrtsenfattoa of the United States of
America in Congress assembled, That this
Act may be cited as the "CIA Accountability
Act of 1987".
Sac. 2. (a) Title 31. United States Code, is
amended by inserting after section 3523 the
following new section:
I3523a. Audit of Central Intelligence Agency Ac-
tivities
"(a) Notwithstanding any other provision
of law, the Comptroller General shall audit
the financial transactions and shall evaluate
the programs and activities of the Central
Intelligence Agency-
"(1) on the initiative of the Comptroller
General; or
"(2) when requested by the chairman of
the ranting minority member of the Select
Comm ittee-on Intelligence of the Senate or
the.Permanent Select Committee on Intelli-
gence of the House of Representatives.
"(b) Whenever the Comptroller General
conducts an audit or evaluation pursuant to
subsection (a), the Comptroller General
shall provide the results of such audit or
evaluation only to the Select Committee on
Intelligence of the Senate, the Permanent
Select Committee on Intelligence of the
House of Representatives, and the Director
of Central Intelligence.
"(c) Notwithstanding any other provision
of law, the Comptroller General may in-
spect and copy any relevant books. docu-
ments, papers, records, other Information.
including written or recorded Information of
all kinds, and property which belongs to, or
is in.the possession or control of, the Cen-
tral Intelligence Agency in order to perform
audits and evaluations pursuant to subsec-
tion (a). The Comptroller General shall also
he provided access to the officers and em-
ployees of the Central Intelligence Agency
at such reasonable times as the Comptroller
General considers necessary to carry out
such audits and evaluations. Notwithstand-
Ing the preceding sentence, the Comptroller
General shall not be provided access to any
officer or employee of the Central Intelli-
gence Agency if the President determines
that access to any such officer or employee
is not in the national interest. The Presi-
dent shall prepare and transmit a report to
the Comptroller General and the chairman
and ranking minority member of each com-
mittee referred to in subsection (aX2) of
this section setting forth his determination.
The President may not delegate the making
of a determination under (his subsection to
any officer or employee of the executive
branch.
"(d) (1) After consultation with the Select
Committee on Intelligence of the Senate
and with the Permanent Select Committee
on Intelligence of the House of Representa-
tives, the Comptroller, General shall estab-
lish procedures to protect from unauthor-
ized disclosure all classified and other sensi-
tive information furnished to the Comptrol-
ler General or his representatives under this
section.
Lion under this, section. the.. Comptroller
General shall provide the Director of Cen-
tral Intelligence with the names. and other
relevant Information concerning each offi-
cer and employee of the General Account.
Ing Office. who may-have access to. orother-
wise be provided with. classified or other
sensitive information in connection with an
audit or evaluation for purposes of security
clearance reviews. The Director of Central
Intelligence.shall complete the necessary se-
curity clearance reviews on an expedited
basis.
"(4) The Comptroller General shall pro-
vide the Director of Central Intelligence
with the name of each officer and employee
of the General Accounting Office who has
obtained a security clearance from the Cen-
tral Intelligence Agency and to whom. upon
proper Identification, the officers, employ-
ees, records, and property of the Central In-
t.eiligenoe.Agency shall be made available in
carrying out'this asstloA.
"(e) This, section may.. be. superseded gnly
by a law enacted. after the dater ofr etaet-
ment of this section specifically repealing or
amending this section.
"(1) The authority provided In this section
is in addition to the authoZtt5 that the
Comptroller General has 4investigate.
audit,, and evaluate the fin cial trarssac-
tions, programs, and activities of any other
establishment or agency of the Government
of the United States.".
(b) The table of sections for chapter 35 of
title 31, United States Code, is amended by
inserting after the item relating to section
3523 the following new Item:
"3522a. Audit of Central Intelligence
Agency activities.".
Sec. 3. (a) Section 3524 of title 31. United
States Code, is amended-
(1). in the first sentence, of subsection
(aXi), by striking out "The" and inserting
in lieu them-of the following: "Except with
respect to audits or evaluations of the Cen-
tral Intelligence Agency as orovided in sec-
tion 3523 of this title-the";
(2) in subsection (c), by inserting "(other
than activities conducted by the. Central In-
telligence Agency)" after "activities";
(3) by amending subsection (d) to read as
follows: "(d) Thla section does not apply to
expenditures under section 102,, 103.
105(dXl). (3). or (5), or 108(b)(2). or (3) of
title 3."; and
(41 in subsection (e), by striking out "or a
financial transaction under section. 8(b) of
the Central Intelligence Act of 1949 (50
U.S.C. 403)(b)r'.
(b) Section 8(b) of the Central Intelli-
gence Act of 1949 is amended-
(1) by inserting "(other than section 3523a
of title 31, United States Code)" after "Gov-
ernment funds"; and
(2) by adding at the end thereof the fol-
lowing new sentence: "The Comptroller
General shall audit expenditures made for
objects of a confidential, extraordinary, or
emergency nature to be accounted for solely
on the certificate of the Director.".
(c) Section 718(d)(IXA). title 31. United
States Code. Is amended by inserting
"(other than activities conducted by the
Central Intelligence Agency)" after "activi-
ties" the first place it appears.
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