2014 Security Clearance Year in Review

January

Interim Clearances—The Under Secretary of Defense for Intelligence (USD-I) issued a memorandum with an effective date of February 1, 2014, regarding new minimum standards for interim secret clearances.  Actual implementation may take more than a year.  More information about this change is available at an article on interim clearances.

NISPPAC Report—The National Industrial Security Program Policy Advisory Committee (NISPPAC) posted the Report of its November 2013 meeting at the Information Security Oversight Office (ISOO) website.   The Defense Security Service (DSS) reported that the furloughs and sequestration from earlier in 2013 temporary halted the submission of personal security investigations to the Officer of Personnel Management (OPM) and created a one-month backlog of about 13,500 cases.  Because of the security studies of the September 2013 Washington Navy Yard shooting, the Director of DSS “suggested that there will likely be enhanced adverse information reporting requirements levied on both government and industry.”  DOD Consolidated Adjudications Facility (DOD CAF) reported that “the elimination of the industrial backlog was estimated at two years.”

Federal Lawsuit Against USIS—The Department of Justice (DOJ) filed a lawsuit against US Investigations Services (USIS), the largest supplier of investigative services to the US Government, for breach of contract and false claims made to the US Government.  USIS is accused of submitting thousands of background investigations to the Office of Personnel Management (OPM) without properly completing a quality review.

Washington Navy Yard (WNY) Shooting Reports—DOD released their internal review and independent review of physical and personnel security practices in the aftermath of the September 2013 WNY Shooting.  The Department of Navy (DON) released their separate review, as well as the Secretary of the Navy’s (SecNav) endorsement of its findings.  The reviews generally included the following recommendations:

  1. Reduce the interval between Periodic Reinvestigations.
  2. Implement the Automated Continuous Evaluation System (ACES).
  3. Through security education emphasize the responsibility of cleared personnel, coworkers, and supervisors to report unfavorable information of security significance.
  4. Establish a DOD insider threat management and analysis center.
  5. Fund the identity management enterprise services architecture.

February

Quality Review of OPM Investigations—Because of the issues underlying the lawsuit against USIS filed by DOJ in January, OPM reported that they were removing all contractor personnel from the final quality review of background investigations.  By the end of February all such reviews will be done by OPM federal employees.

OPM IG Act—This act, which was introduced in the House of Representatives as H.R. 2860 and was essentially the same as Senate Bill 1276 (Security Clearance Oversight and Reform Enhancement Act—SCORE), became Public Law 113-80 on 2/12/2014.  It authorizes the OPM Inspector General (IG) to use up to 0.33% of the billion dollar OPM Federal Investigative Services (FIS) revolving fund to conduct audits of the fund.

GAO Report on Security Clearances—The General Accountability Office (GAO) released a report titled, “Actions Needed to Ensure Quality of Background Investigations and Resulting Decisions” (GAO-14-138T).  The report found that “Executive branch agencies do not consistently assess quality throughout the personnel security clearance process, in part because they have not fully developed and implemented metrics to measure quality in key aspects of the process.”

March

OMB Personnel Security Review—The White House Office of Management and Budget (OMB) released its report on background investigations that support hiring, credentialing, suitability, fitness, and security clearance decisions.  The review was primarily in response to the WNY Shooting and was similar but less detailed than the DON review and the two DOD reviews released in January.

SecDef Approves 4 Recommendations from WNY Shooting Reviews—The Secretary of Defense (SecDef) approved four recommendation made by the DOD Internal and Independent Reviews of the WNY Shooting, plus directed further analysis of three additional recommendations made by the Independent Review, which included regaining responsibility for conducting its own background investigations, which have been conducted by OPM since 2005.

SecNav Approves All Recommendations from WNY Shooting Report—The SecNav approved all 14 recommendations contained in the Navy’s Judge Advocate General Manual (JAGMAN) investigation of the WNY Shooting.  A list of completed actions was also published.

April

DOD Inspector General (IG) Report—The DODIG issued Report No. DODIG-2014-060, “An Assessment of Contractor Personnel Security Clearance Processes in the Four Defense Intelligence Agencies.” The report had findings that affect all DOD agencies, including:  1) lack of effective personnel security policy, 2) lack of effective record keeping, 3) avoidance of security adjudication, 4) lack of information sharing, and 5) lack of connectivity between the Defense Central Index of Investigations and the Joint Personnel Adjudication System.  Item #3 refers to the refusal to adjudicate a case when there is a “Loss of Jurisdiction.”

ODNI 2013 Report on Security Clearance Determinations—The Office of the Director of National Intelligence issued its annual statistical report on security clearances.  The most surprising new information in the report was the number of people (2,058,402) who had clearances (access eligibility), but who did not currently require access.  This represents about 40% of all cleared personnel (5,150,379).

May

OPM FIS Annual Stakeholder Report—The FIS Report for Fiscal Year 2013 consists of 31 pages of facts and figures detailing almost every aspect of FIS operations.  To their credit FIS refunded about $25 million (2.5% of their Revolving Fund) to their customers and essentially have not raised their prices in 3 years.

NISPPAC Report—NISPPAC posted its March 2014 meeting report at the ISOO website.  There was considerable discussion regarding the new Continuous Evaluation (CE) program and its phased implementation.  “CE will be phased in over a period of three years with the first goal to develop initial operating capability by the end of FY 2014, which will involve a small set of [CI] agencies at the TS/SCI level. . . and embrace a limited number of data sets, so as to build the foundation for a much more extensive program. . . [and] will be fully implemented [for the Tier 5 level] by the end of 2016.”   Tier 5 refers to investigations for TS and TS/SCI clearances.

June

OPM IG Report—Findings in this report included: 1) deficiencies in the quality review process for background investigations, 2) missing training documents for case reviewers, and 3) weak FIS control over contractor quality review process.

DSS Access–Volume 3, Issue 2 (June 2014) of the quarter DSS publication “Access” contained DSS Personnel Security Management Office for Industry (PSMO-I) updates and initiatives on industrial personnel security investigations (PSI), including information on PSI submissions backlog, electronic fingerprint submissions, changes to interim clearance processing, data quality initiatives, JPAS account management, and a future Case Adjudication Tracking System (CATS) portal for industry Facility Security Officers (FSOs).

Quarterly CAP Goal—“Insider Threat and Security Clearance Reform” was created as a new Cross-Agency Priority Goal and the first quarterly (2nd Quarter FY2014) progress update was released.

July

OPM’s e-QIP Hacked—The New York Times reported that in March Chinese hackers broke into OPM’s computer system that maintains personal information on people who have applied for federal security clearances.

2014 Intelligence Authorization Act (IAA) Enacted—The 2014 IAA became Public Law No: 113-126.   Among other things it requires the Director of National Intelligence (DNI) to “(1) ensure that the background of each employee or officer and contractor of the intelligence community is monitored continuously to determine their eligibility for access to classified information; and (2) develop procedures to require sharing of potentially derogatory security information concerning an employee, officer, or employee of a contractor of the intelligence community that may impact the eligibility of such individuals for a security clearance.”

Security Interview by Chatbot—The National Center for Credibility Assessment (NCCA) conducted a study to determine the feasibility of conducting security clearance interviews conducted using a Chatbot.  In their study they used U.S. Army volunteers who interviewed by a Chatbot while hooked up to cardiographic and electrodermal (heart and skin) monitor.

Tax Debts Owed by Security Clearance Holders—In 2013 GAO reported (GAO-13-733) that about 8,400 non-DOD federal security clearance holders owed about $85 million in unpaid federal tax.  As a follow up GAO issued GAO-14-686R that reported about 83,000 DOD military, civilian employees, and contractors with security clearances had unpaid federal tax debt totaling more than $750 million.

August

DHS Issues Stop Work Order to USIS—The Department of Homeland Security (DHS), which contracted directly with USIS for background investigations, issued a stop work order because of a reported cyber-attack on the USIS computer system, potentially compromising investigative data from thousands of cases.

OPM Stops Issuing New Cases to USIS—Because of the reported cyber-attack on the USIS computer system, OPM stopped issuing any new investigative work to USIS.  OPM later directed USIS to return all uncompleted investigations to OPM.  About 2,000 USIS employees were furloughed.  The work that was previously assigned to USIS will be redistributed to the other investigative elements working for OPM.

September

OPM Fires USIS—OPM announced that it would not renew its investigative services contract with USIS.  USIS investigators began scrambling to apply for employment with the two remaining OPM Investigation Service Providers (ISP):  Keypoint Government Solutions (KGS) and CACI.  Both firms began handling thousands of job applications from former USIS investigators.  KGS doubled in size and replaced USIS as the nation’s largest ISP.

ODNI Polygraph Policy—Security Executive Agent Directive 2 (SEAD 2) on the use of security screening polygraph exams was obtained by Marisa Taylor of McClatchy News under the Freedom of Information Act.  In summer 2012 allegations surfaced about misconduct involving polygraph exams conducted by the National Reconnaissance Office (NRO).  Several news articles were written about alleged abuses at NRO.  Two congressmen voiced their concerns, and the IG of the Intelligence Community conducted an investigation.  The result is a new national polygraph policy that says very little—much less than the DOD Instruction on polygraph.  Absent is any policy on unfavorable administrative action based solely on unresolved personnel security screening examinations or limitations on pre-test or in-test questioning.

Quarterly CAP Goal—The “Insider Threat and Security Clearance Reform” Cross-Agency Priority Goal quarterly progress update for 3rd Quarter FY2014 was released.

GAO Report on Security Clearances—GAO released a report titled, “Personnel Security Clearances: Additional Guidance and Oversight Needed at DHS and DOD to Ensure Consistent Application of Revocation Process” (GAO 14-640), in which it provided data on the number and type of issues that resulted in clearance revocations.

October

Cyber-vetting Could Become Part of Security Clearance Process—An online article at the Federal New Radio website reported that “For the past six months, the Director of National Intelligence has been trying to determine whether the government should do Google searches on people who hold security clearances.”   The Director of the National Counterintelligence Executive was quoted as saying, “We’re trying to identify whether or not it’s practical, viable and feasible to even use [social media] as part of the evaluation and adjudication process.”

Federal Investigative Notices (FIN)FIN 14-06, “Special Agreement Check and Reimbursable Suitability/Security Investigation Billing Rates Effective October 1, 2014” and FIN 14-07, “Investigations Reimbursable Billing Rates Effective October 1, 2014” combine to provide the new billing rates for all investigative product offered by OPM for FY2015.  Overall there were some minor changes in product costs, but overall rates remained essential the same as last year.

NISPPAC Report—NISPPAC posted its June 2014 meeting report at the ISOO website.  The Director of DSS “advised that a revised interim [security clearance] process would not be instituted within industry until there was an automated process that would permit DSS to retrieve fingerprints and complete a review of the Standard Form (SF) 86, and the results of national agency checks.”  A DOD CAF industry representative “emphasized that the CAF completes about 180,000 adjudications for industry every year, and issues a Statement of Reasons (SOR) for about 4% of that caseload.”  The Director of DOHA “noted that, contrary to what is reported in JPAS, there are far less than the 10,000 cases reported at DOHA, and indicated that the number is actually around 1,000 cases.”

November

Owner of Polygraph.com Indicted—Douglas Williams was indicted on obstruction of justice and mail fraud charges for allegedly training customers to lie and conceal crimes during polygraph examinations.

New Nominee for Director of Naval Intelligence—The SecNav nominated Rear Admiral Elizabeth Train to replace Vice Admiral Ted Branch as Director of Naval Intelligence.  Branch had his security clearance suspended in September 2013 due to possible involvement in a bribery scandal.  Since then Branch has been unable to attend important, classified meetings with other service intelligence chiefs, leaving the Navy underrepresented that those meetings.  The SecNav nominated Train because there was no indication of how much longer the FBI would take to complete their investigation.

Federal Investigative Notices (FIN)FIN 15-03, “Implementation of Federal Investigative Standards for Tier 1 and Tier 2 Investigations.”  OPM is implementing the revised Federal Investigative Standards (FIS) according to the phased FIS Implementation Plan.  “Tier 1 is the investigation for positions designated as low-risk, non-sensitive. . . using the Standard Form (SF) 85.  Tier 2 is the investigation for non-sensitive positions designated as moderate risk public trust positions. . . using the SF 85P.”  “OPM is conducting Tier 1 investigations in lieu of the former National Agency Check and Inquiries (NACI) (SF 85) product and Tier 2 investigations in lieu of the former Moderate Risk Background Investigation (MBI) (SF 85P).”  Neither the revised FIS nor the FIS Implementation Plan has been made publicly available.

December

KGS Security Files Hacked—Following cyber-attacks on OPM (reported in July) and USIS (reported in August) security clearance records, hackers broke into Key Point Government Solution’s (KGS) computer system that maintains personal information on people who have applied for federal security clearances.

Quarterly CAP Goal—The “Insider Threat and Security Clearance Reform” Cross-Agency Priority Goal quarterly progress update for 4th Quarter FY2014 was released. The Government’s efforts to improve personnel security and protect sensitive facilities are falling behind schedule.

 

Things That Didn’t Happen In 2014

New Adjudicative Guidelines—ODNI has been working on new security clearance Adjudicative Guidelines for about 5 years.  Two sets of guidelines currently exist.  One set was approved by the President in December 2005.  ODNI issued guidelines in October 2008.  The 2 sets of guidelines are the same, except for Guideline C—Foreign Preference.  The ODNI’s version of Guideline C is much more permissive.  It allows people to obtain foreign citizenship, maintain dual citizenship, and exercise of rights of foreign citizenship, including the use of foreign passports.  For this reason DOD refuses to use the ODNI guidelines, and it appears that DOD and ODNI have been unable to reconcile their differences.

New SF86—The “60-Day notice and request for comments” for proposed changes to the SF86 (Questionnaire for National Security Positions) was posted to the Federal Register in March 2013.  The “30-Day Notice and request for Comments” for proposed changes to the SF86 was posted to the Federal Register July 2013.  Extensive changes were made after the initial comment period, but it’s been 18 months and a new SF86 still hasn’t been approved.  At least the latest proposed changes include a rewrite of Question 21 (Mental Health), and it is now written in an objective rather than totally subjective manner.

Incident Reporting—ODNI announce 2 years ago that they were developing new national standards for reporting matters that affect clearance eligibility.  The new standards have been in the final stages of coordination for over a year.  If and when they are issued, they will be released as SEAD 400).  Currently self-reporting requirements for cleared personnel are vague, confusing, and inconsistent across federal agencies.  New standardized national reporting requirements are badly needed, especially in light of the failure to report the bizarre conduct of Aaron Alexis during the month preceding the WNY Shooting that resulted in the murder of 12 people.

 

Legislation That Died When the 113th Congress Ended

SCARE Act—Had it been enacted the Security Clearance Accountability Reform and Enhancement Act (S. 1744) would have required OPM to (1) terminate or place on administrative leave an OPM employee for falsifying investigative reports and  (2) debar or suspend a contractor for intentional involvement in similar misconduct. The act would have required the review and updating of guidance for (1) position sensitivity designations; (2) quality controls; and (3) periodic reviews of position sensitivity designations.

Security Clearance Reform Act of 2014—Had it been enacted H.R. 4022 would have required the President to submit to Congress a strategic plan to improve security clearance and background investigation activities, including continuous evaluation.  It would have required that all final quality reviews of background investigations, all investigations for Top Secret clearances, and all interviews of clearance applicants be done by federal employees.  It would have also required OPM to report to Congress any criminal justice agencies that refuse to provide criminal records to OPM and would have reduced criminal justice grant funding to those agencies.

CORRECT Act—Had it been enacted the Clearance and Over-Classification Reform and Reduction Act (H.R. 5240) would have decreased the number of security clearances, as well as the amount of classified information.  It would have addressed privacy concern related to continuous evaluation and required improvement of the background investigation process.

Enhanced Security Clearance Act—Had it been enacted H.R. 5482 would have required a plan to eliminate backlogs of overdue periodic reinvestigations (PRs), instituted new intervals for PRs using automated record checks twice every five years, and required enhanced personnel security programs for security reviews, including the use of cyber-vetting and data mining.

Prevent Conflict of Interest with Contractors Act—Had it been enacted S. 2061 would have precluded contracts or contract extensions for conducting quality reviews of background investigation fieldwork services or background investigation support services, if the contractor is performing the services to be reviewed. _________________________________________________________

By William Henderson, January 23, 2015

All Original Material Copyright © 2015 Federal Clearance Assistance Service. All rights reserved.

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