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1. On 10 September 1997 a meeting of the Security Policy Advisory Board (SPAB) was held at the Holiday Inn in Boston, Massachusetts. General Larry Welch, USAF (Ret.), presided with Board members Ms. Nina Stewart and Rear Admiral Thomas Brooks, USN (Ret.), also present. Numerous members of the public also attended and participated.


2. Mr. Terry Thompson, the Responsible Federal Officer, opened the meeting at 0930 hours and introduced General Welch who provided some history and perspective on the formulation of the Security Policy Advisory Board.

3. General Welch then discussed the Advisory Board's recent annual report which has been presented to the Security Policy Board and is enroute to the President. In it, the SPAB emphasizes that reciprocity, based on common standards, is a must. While much progress has been made in this area much remains to be accomplished. Research based data needs to be developed to strengthen the underpinnings of reciprocity and hasten full implementation. Progress on the development of a common database has been slow. OPM and DIS are currently working to link their databases and provide the community with one common source for clearance and investigative data. This effort should be considered a top priority. General Welch indicated that the unrestrained demand for investigative services threatens to overwhelm the existing capability. In order to manage this issue, the SPAB has recommended to the President that a fee for service format be established. The Advisory Board recognizes the inherent limitations and obstacles associated with fee for service but nevertheless feels a worthwhile economy of demand can be achieved via this mechanism. Another priority included in the Advisory Board's report to the President is the need to establish some uniformity of standards in administering Special Access Programs (SAPs). SAPs, while vital to a solid security program, are often redundant and add much consequent cost. Uniformity of standards will enhance reciprocity in the SAP arena and achieve considerable cost savings. Lastly, General Welch indicated the entire SPB process needs to be revitalized. The Board has recommended that a manageable number of objectives be attacked during the coming year and those be pursued with an increased sense of urgency. He concluded by stating the Security Policy Board Staff has performed well in an unwieldy process and must continue to press on.


4. Mr. Thompson then began a discussion of Financial Disclosure. He began by reviewing the history of the issue from its inception with the Counterintelligence and Security Enhancement Act of 1995 to the current timeframe. Executive Order 12968 mandated a financial disclosure form for five categories of cleared employees and much effort on the part of the SPBS has been invested in developing a form. At a conference in Glynco, GA, a panel of financial experts were convened and crafted a form which was subsequently presented to the Security Policy Forum. Upon reviewing the form, the Forum directed the Financial Disclosure Working Group to develop an investigative module with additional financial emphasis. To that end, the working group is proposing an expanded effort to include:

5. This module has been presented to the Security Policy Forum and approved in principle. Mr. Thompson noted that CIA has its own financial disclosure form and program which was authorized by the DCI and is currently in place. PERSEREC is currently developing a screening tool which will utilize commercial databases to verify data provided on a financial disclosure form. This tool is slated for completion in June 1998.

6. Mr. Joseph Reynolds of Lockheed Martin Sanders indicated his company strenuously objects to financial disclosure on the grounds of invasiveness. He also indicated such a requirement diminishes the attractiveness of government contracts in general and might make attracting good employees associated with these contracts more difficult.


7. The Board believes that adding an intrusive financial disclosure form will have only negative effects. Should the requirement nevertheless go forward, there should be only a single approach used by all agencies rather than a profusion of different forms. The Board strongly recommends that a single form, agreed to by all agencies, be adopted. Furthermore, they requested the precise wording of the proposed questions on the SF 86 be presented for review. It was also noted that whatever utility might result from income description would be of less value in the private sector-- as compared to the government domain where salary scales are a matter of record. Lastly, it was opined that the financial disclosure requirement engenders much ill will and consequently could contribute to future employee disgruntlement-- a common underlying cause in espionage cases.


8. Ms. Kathy Dillamen, OPM, was then introduced and indicated the linkage of the OPM and DOD security databases is approaching the test stage. She stated the two databases use different computer languages and consequently one of the primary obstacles to linkage has been a technical one. That particular problem has been surmounted and a Beta test successfully run on 2 September. NSA has recently certified the system as secure-- another longstanding obstacle. The Personnel Security Committee has levied a requirement for a SECRET clearance for anyone with access to the database and both OPM and DOD have concurred. Ms. Dillamen indicated that the database will contain clearance and investigative data and that this data must be input into the system by the participating agencies. This loading of information is now ongoing. Ms. Dillamen summarized, stating the system should be deployed sometime between 14 October and 1 January.


9. The Board strongly endorses this innovation and is pleased with the progress to date. They encourage all agencies which conduct investigations to download their clearance and investigative data into the system as soon as is practicable.


10. Ms. Laura Kimberly, Information Security Oversight Office, then addressed the issue of classification and declassification of information. Ms. Kimberly stated the Secrecy Commission recommended a statute be adopted to govern the management of classified data and a legislative working group is currently assigned to review any proposed statute. Their product will move forward to the White House through OMB. Ms. Kimberly indicated EO 12958 has had a very positive effect in reducing the volume of older classified material in that it assumes declassification, absent intervention to retain classification, after twenty-five years. Ms. Kimberly then reviewed some figures which illustrated the trend toward classifying less information and declassifying existing information. This trend began in the early nineties and, with the anomaly of 1996, continues to date. Turning to the NISP, Ms. Kimberly indicated the NISP is firmly supported by industry but the perception persists that implementation is slow-- or perhaps non-existent. While ISOO has policy oversight of the NISP, it currently lacks the resources to carry out this responsibility as fully and effectively as it would like. The speaker stated that, in order to be effective, the NISP must be supported by the upper echelon of government management.

11. Mr. Joseph Reynolds then volunteered that DIS has been most accommodating in adopting and implementing the NISP. General Welch echoed that sentiment based on his own experience as a CEO in the defense industry.


12. The Advisory Board enthusiastically endorses this effort and noted that the community needs to change the mindset from a predisposition to classify to a predisposition not to classify.

13. At this point the presentation of agenda items was completed and no further input from the public was forthcoming. Mr. Thompson closed the meeting at 1145 hours.

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