[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]
SECURITY CLEARANCE INVESTIGATION CHALLENGES AND REFORMS
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HEARING
BEFORE THE
SUBCOMMITTEE ON
GOVERNMENT OPERATIONS
OF THE
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
__________
OCTOBER 11, 2017
__________
Serial No. 115-41
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Printed for the use of the Committee on Oversight and Government Reform
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Committee on Oversight and Government Reform
Trey Gowdy, South Carolina, Chairman
John J. Duncan, Jr., Tennessee Elijah E. Cummings, Maryland,
Darrell E. Issa, California Ranking Minority Member
Jim Jordan, Ohio Carolyn B. Maloney, New York
Mark Sanford, South Carolina Eleanor Holmes Norton, District of
Justin Amash, Michigan Columbia
Paul A. Gosar, Arizona Wm. Lacy Clay, Missouri
Scott DesJarlais, Tennessee Stephen F. Lynch, Massachusetts
Trey Gowdy, South Carolina Jim Cooper, Tennessee
Blake Farenthold, Texas Gerald E. Connolly, Virginia
Virginia Foxx, North Carolina Robin L. Kelly, Illinois
Thomas Massie, Kentucky Brenda L. Lawrence, Michigan
Mark Meadows, North Carolina Bonnie Watson Coleman, New Jersey
Ron DeSantis, Florida Stacey E. Plaskett, Virgin Islands
Dennis A. Ross, Florida Val Butler Demings, Florida
Mark Walker, North Carolina Raja Krishnamoorthi, Illinois
Rod Blum, Iowa Jamie Raskin, Maryland
Jody B. Hice, Georgia Peter Welch, Vermont
Steve Russell, Oklahoma Matt Cartwright, Pennsylvania
Glenn Grothman, Wisconsin Mark DeSaulnier, California
Will Hurd, Texas Jimmy Gomez, California
Gary J. Palmer, Alabama
James Comer, Kentucky
Paul Mitchell, Michigan
Greg Gianforte, Montana
Sheria Clarke, Staff Director
Robert Borden, Deputy Staff Director
William McKenna General Counsel
Jack Thorlin, Deputy Subcommittee Staff Director
Kiley Bidelman, Clerk
David Rapallo, Minority Staff Director
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Subcommittee on Government Operations
Mark Meadows, North Carolina, Chairman
Jody B. Hice, Georgia, Vice Chair Gerald E. Connolly, Virginia,
Jim Jordan, Ohio Ranking Minority Member
Mark Sanford, South Carolina Carolyn B. Maloney, New York
Thomas Massie, Kentucky Eleanor Holmes Norton, District of
Ron DeSantis, Florida Columbia
Dennis A. Ross, Florida Wm. Lacy Clay, Missouri
Rod Blum, Iowa Brenda L. Lawrence, Michigan
Bonnie Watson Coleman, New Jersey
C O N T E N T S
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Page
Hearing held on October 11, 2017................................. 1
WITNESSES
Mr. Charles S. Phalen, Jr., Director, National Background
Investigations Bureau, Office of Personnel Management
Oral Statement............................................... 5
Written Statement............................................ 8
Mr. Garry P. Reid, Director of Defense Intelligence, Office of
the Under Secretary of Defense for Intelligence, U.S.
Department of Defense
Oral Statement............................................... 14
Written Statement............................................ 16
Mr. William R. Evanina, Director, National Counterintelligence
and Security Center, Office of the Director of National
Intelligence
Oral Statement............................................... 19
Written Statement............................................ 21
Mr. A.R. ``Trey'' Hodgkins III, Senior Vice President, Public
Sector Information Technology Alliance for Public Sector
Oral Statement............................................... 25
Written Statement............................................ 27
APPENDIX
Opening Statement of Ranking Member Gerald E. Connolly........... 56
SECURITY CLEARANCE INVESTIGATION CHALLENGES AND REFORMS
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Wednesday, October 11, 2017
House of Representatives,
Subcommittee on Government Operations,
Committee on Oversight and Government Reform,
Washington, D.C.
The subcommittee met, pursuant to call, at 2:01 p.m., in
Room 2154, Rayburn House Office Building, Hon. Mark Meadows
[chairman of the subcommittee] presiding.
Present: Representatives Meadows, Hice, Jordan, DeSantis,
Blum, Maloney, and Norton.
Also Present: Representative Krishnamoorthi.
Mr. Hice. [presiding.] Subcommittee on Government
Operations will come to order. Without objection, the chair is
authorized to declare a recess at any time.
Today's hearing will cover a topic of great importance. How
to ensure security clearance investigations are effective and
efficient. We're discussing this now because of the record
700,000 investigation backlog of background investigations
throughout the Federal Government.
For would-be Federal or contractor employees awaiting their
first clearance, the backlog means they have to wait months
before they can start working.
The problem calls for thoughtful analysis and meaningful
reform, not knee-jerk reactions and superficial solutions.
Unfortunately, we appear to be on the verge of knee-jerk
reaction. Transferring responsibility for the vast majority of
clearance investigations, back to the DOD away from the
National Background Investigations Bureau.
I say ``back to,'' because in a similar record backlog
situation in 2004, DOD gave up the investigation
responsibility. Back then, DOD thought it needed to focus on
its function of defending the country, so it tasked the Office
of Personnel Management with the labor-intensive investigations
function.
Today, only a year after the creation of the NBIB, the
Senate NDAA contains a provision that would transfer the
investigation function back to the DOD.
Though DOD has put out a plan for how it would take over
investigations, it has yet to issue much in the way of an
argument as to why it should do so. There are much clearer
reasons for why it should not.
Standing up a DOD investigation capacity while NBIB is
still operating would obviously be duplicative to agencies
literally doing the same thing. NBIB has only recently managed
to hire enough contractor investigations to match what the
Federal Government could muster in 2014 before a scandal
involving one contractor forced OPM to terminate 60 percent of
the contractor workforce.
A major shift of resources to DOD would halt the growth and
the contractor workforce that is digging the government out of
the backlog hole. There is every reason to believe, therefore,
that a transfer would worsen the backlog and deprive our Armed
Forces of the people they need to function.
At the same time, NBIB is spearheading new reforms in
technology and administration to make the process more
efficient. The ongoing reform effort could be slowed or
abandoned altogether, as DOD spends its institutional energy
simply recreating what already exists at NBIB.
The contractor community shares these concerns. The people
whose money depends most on a functioning investigation system
are telling us not to transfer investigations back to DOD.
I hope today's hearing will help Congress make an informed
decision on whether to go ahead with the transfer to DOD
through the NDAA process.
I would like to thank our witnesses for being here today
and I look forward to hearing from your testimony.
I now would like to recognize the ranking member, Ms.
Norton, for her opening statements.
Ms. Norton. Thank you very much, Mr. Chairman.
Thank you for holding this hearing to examine both the
current backlog in the Federal security clearance
investigations, and potential reforms to the background
investigation process.
Last month, the National Background and Investigations
Bureau reported a backlog of approximately 700,000 security
applications. This backlog and the lengthy wait time for
security clearances is unacceptable.
It is critical that the NBIB address this problem and
important for Congress to provide and resolve the necessary
resources and support to do so.
Since it first began operating in October 1, 2016, the NBIB
has been tasked with the challenge of not only improving the
Federal Government's process for conducting background checks,
but also bringing down the growing security clearance backlog.
Since its creation, the NBIB has made several enhancements
to the security clearance investigation process. For example,
it developed a continuous evaluation program for monitoring an
employees's or contractor's eligibility to maintain access to
classified information. And earlier this year, the NBIB created
a new law enforcement unit to improve the government's ability
to gain access to criminal history records of State and local
enforcement agencies.
This is an important change that could eliminate a critical
gap in how background checks were previously conducted. The gap
has enabled an unknown number of people to gain security
clearances they probably should not have received. The
importance of gaining access to criminal history records became
all too clear on September 6, 2013 when Aaron Alexis, a Federal
contractor, with a secret level clearance entered the
Washington Navy Yard, killed 12 people and injured four others.
During the investigation into that incident, we learned
that the background investigation of Mr. Alexis failed to
identify his history of gun violence.
Local police records of his 2004 firearms arrest had never
been provided to Federal investigators. Improving the level of
communication between local law enforcement agencies and
Federal background investigators can prevent future tragedies
like the one at the Navy Yard here in the District of Columbia.
While the NBIB has made some gains in improving the
background investigation process, it has struggled to reduce
the heavy backlog of security clearance applications.
The current backlog is largely due to termination of the
contract that U.S. Investigation Services had with the Office
of Personnel Management to conduct background checks. USIS had
previously performed the bulk of background investigations for
OPM, but was caught defrauding the government on a massive
scale, allegedly dumping 665,000 background check cases,
indicating to OPM that the background checks had been complete
when the proper reviews had not taken place.
OPM had no choice but to terminate the contract with that
company. At the time of USIS's termination, it held 60 percent
of the Federal Government investigative capacity for background
checks. OPM remains unable to fully replace the significant
amount of capacity that was lost with USIS's termination, and
we need to know why.
Various proposals have been put forward to address the
backlog. The most notable of these is the Department of Defense
plan that would strip the NBIB of its background investigations
for DOD personnel.
Most recently, the Senate has included language in its
draft of the National Defense Authorization Act for fiscal year
2018 that would adopt DOD's plan. The DOD plan raises serious
concerns. Namely, it could potentially increase, rather than
decrease, the existing backlog for security clearances.
According to the DOD plan, it would take the Department at
least 3 years to even assume responsibility from the NBIB for
background checks of its personnel. During that 3-year
transition period, the NBIB would be expected to use its
limited resources to help the DOD build the capacity required
to perform its own background checks, which may result in
additional backlogs at the BIB. The BIB has examined DOD's
proposal and found it has potential to, and I quote,
``exacerbate the current investigative backlog,'' end quote.
OPM has also examined DOD's plan and reached the same
conclusion. Outside of the Federal Government, policy
organizations ranging from the Information Technology Industry
Council to the Professional Services Council, have reported
that DOD's plan would, and I quote, ``cause further delays.''
Transferring a significant portion of the NBIB's
responsibilities to the DOD also risks returning to a process
that was previously found to be inefficient.
Prior to 2005, DOD was responsible for conducting
background investigations of its own personnel. During that
time, the government accountability office issued a series of
reports that raised concerns over the quality and the
timeliness of those investigations.
The most significant of those reports was released in 1999
in which the GO found that, and I quote, ``DOD personnel
security investigations are incomplete and not conducted in a
timely manner,'' end quote.
DOD's failure to adequately handle its own security
clearance investigations was a primary reason that
responsibility was transferred to OPM in 2005.
Congress needs to seriously examine the best means to
reduce the current backlog, but we must do so in a way that
balances the need to expedite the process without sacrificing
the quality of those investigations.
The Navy Yard shooting, and high profile National Security
leaks, such as the one carried by the contractor, Edward
Snowden, highlight the need for ensuring that background checks
are conducted in a thorough and efficient manner.
I want to thank the witnesses for testifying today. We look
forward to hearing from each of you on ways we can strengthen
the Federal Government's capabilities when it comes to security
clearance investigations.
And I thank you again, Mr. Chairman.
Mr. Hice. Thank you. At this time, I'm pleased to introduce
our witnesses.
First, we have Charles Phalen, Jr., the Director of the
National Background Investigations Bureau at the Office of
Personnel Management.
Next to him is Garry Reid, Director of Defense Intelligence
in the Office of Under Secretary of Defense for Intelligence at
the Department of Defense.
Next is William Evanina, is that correct?Mr. Evanina is the
Director of the National Counterintelligence and Security
Center at the Office of the Director of National Intelligence.
And then finally, Mr. Trey Hodgkins, III, Senior Vice
President For the Public Sector At the Information Technology
Alliance.
I want to thank each of you for being here today. And
welcome you all pursuant to the committee rules. All witnesses
will be sworn in before they testify. So at this time, if you
would please rise and raise your right hand.
Do you solemnly swear or affirm that the testimony you are
about to give is the truth, the whole truth, and nothing but
the truth so help you God?
Mr. Hice. The record will reflect that all witnesses
answered in the affirmative, and we appreciate it.
In order to allow time for discussion, please, I would ask
that you limit your testimony to 5 minutes, knowing that your
entire written statement will be made part of the record.
As a reminder, the clock there in front of you shows your
remaining time. When the light turns yellow, you have 30
seconds remaining, and then when it turns red, your time is up.
So please, wrap it up as rapidly, as quickly as you can at that
point.
And, please, also remember to press the button for your
speaker. And I'd ask that you'd put the microphone up there
closely right in front of you so we can hear.
So at this time, Mr. Phalen, I'm honored to recognize you
for 5 minutes. And thank you for being here.
WITNESS STATEMENTS
STATEMENT OF CHARLES PHALEN
Mr. Phalen. Thank you, Mr. Chairman, ranking member and
members of the subcommittee. I'm Charles Phalen, Jr., and I'm
the Director of the National Background Investigation Bureau of
the Office of Personnel Management, and I do appreciate the
opportunity to appear before you today.
Over the past year, since we stood up on October 1st, NBIB
has established a strong focus on National Security, customer
service, and continuous process and improvement to meet the
critical government-wide need for a trusted workforce.
NBIB conducts 95% of the investigations across the Federal
Government, even those few agencies that have delegated or
statutory authority to conduct their own investigations, such
as some agencies in the intelligence community, rely on NBIB
services in some capacity.
Our organizational structure is aimed at leveraging
automation to the greatest extent possible, transforming
business processes and enhancing customer engagement and
transparency. And I strongly believe that these efforts are
paving the way for improvements in the efficiency, cost
effectiveness and the quality of the investigations in the
Federal Government.
I would like to address NBIB's existing investigative
backlog, which has been the subject of much attention. The
current inventory stabilized this summer and has reduced
modestly over the last 10 weeks.
Our current inventory is approximately 704,000
investigative products, including simple record checks,
suitability and credentialing investigations, along with the
more labor-intensive national security investigations and
reinvestigations.
The total number of investigative products is greater than
the number of individuals that are waiting for their first
security clearance to begin working on behalf of the
government.
A significant percentage of individuals waiting for their
initial national security investigations are working under
interim clearances pending completion of the full investigation
and ultimate adjudication.
NBIB has worked to increase capacity and realize
efficiencies in as many ways as possible.
Stabilization and modest increases have been attained
because we have invested in the necessary infrastructure. This
infrastructure has been built through contractor and Federal
workforce capacities.
In 2016, NBIB hired 400 new Federal investigators, and
awarded a new field work contract doubling our field work
contract companies from 2 to 4.
In 2017, we initiated hiring another 200 Federal
investigators, issued work under those new contracts, and we
are working closely with the vendors to quickly increase the
capacity of our contract investigators. We had a goal in 2017,
and we missed it by about 6 percent, but we are at, or near the
level of contract investigations and Federal investigators that
we had in 2014. We have recovered to that level.
As of today, that's a little over 6,900 full-time
equivalent investigators working on our behalf. We are targeted
to grow that number.
NBIB also believes its capacity can be increased to the
smarter use of our workforce's time. The less time each
investigator needs to spend on each case, the more time the
investigator has for the next case in his or her own queue.
This has led us to streamlining processes, reallocating
resources and amending our internal policies for greater
efficiencies and effectiveness while maintaining quality and
reciprocity for all of the government.
Use of investigator time can also be the strengthened
through effective use of technology and other available tools.
Our efforts have targeted surgical approaches, such as
successfully expediting 14,000 cases in accordance with
agencies' prioritize list, and done that in an average time of
95 days.
NBIB has actively enhanced customer service and
accountability in a number of ways, including realigning price
adjustments earlier this fiscal year to better align with
agencies' budget cycles.
NBIB is focused on policy and process changes to add
efficiency, reduce the level of effort and maintain the
investigative quality. And to support this effort, we work
closely with the Department of Defense and other customer
agencies. We're working to address current challenges and
introduce mitigation activities to best serve the interest of
all government agencies and departments.
We will, with the support of its interagency partners,
make, and will continue to make, improvements on the background
process. We have strengthened our partnership with DOD while
building the National Background Investigation Services, NBIS,
which will serve as NBIB's IT system for the whole of
government, to perform background investigations across the
spectrum.
As NBIS comes online, we will be able to phase out our
legacy systems in favor of NBIS. It is imperative that this
mission evolve by leveraging cutting-edge technologies and
applying innovative solutions to obtain rich and valid
information in support of clearance determinations. It is
equally important that the process, improvements, and
methodologies have made it across the entire enterprise in a
standardized fashion so the quality of investigative products
facilitate the reciprocity of clearances across the Federal
Government.
As we work to reduce the inventory, we will continue to
explore new and innovative ways to meet our customers' needs
and leverage their expertise, and remain transparent and
accountable to our stakeholders and to Congress.
We recognize that solutions reduce the inventory, and to
maintain the strength of the background investigation program,
include people, resources and technology.
And thank you again for the opportunity to speak with you
here today. I look forward to answering any questions you have.
[Prepared statement of Mr. Phalen follows:]
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Mr. Meadows. [presiding.] Thank you.
Mr. Reid, you're recognized for 5 minutes.
STATEMENT OF GARRY P. REID
Mr. Reid. Thank you, Mr. Chairman, members of the
subcommittee. I appreciate the opportunity to participate in
this hearing today.
I'll ask for the chair's indulgence on submitting a
statement for the record as a late-add. We didn't get it over
here prior to the hearing, but we will get it over here right
away. Thank you.
To summarize my statement, the background investigation
backlog is a matter of significant concern for the Department
of Defense.
Long delays in obtaining security clearances are causing
turmoil in personnel management, mission effectiveness, and
technology development across the Department. This is within
our military services, our civil workforce, and our cleared
industry contractors.
Despite focused efforts to mitigate the backlog and the
resultant negative effects on DOD, our senior leaders have
called for new and innovative approaches to address issues of
costs, performance, and timeliness within the personnel vetting
enterprise.
As the committee is aware, Section 951 of the 2017 National
Defense Authorization Act, required DOD to develop plans for
assuming control of our background investigations, as is
already done by 23 of their Federal agencies.
On August 25, Secretary Mattis approved the Section 951
plan and notified Congress, the Director of National
Intelligence, the Director of the Office of Personnel
Management, and the, Director of the Office of Management and
Budget of his intent to look beyond the realm of incremental
improvements and take full advantage of today's technology to
alleviate the burdens of costly, time-intensive investigations
that are hampering our mission-readiness.
The Department of Defense is well-postured to take these
bold steps, and cognizant of the risks associated with such an
endeavor.
In recent years, with the support of Congress, DOD has
developed and tested new processes and capabilities for
continuous evaluation and automated records checks to enhance,
automate, and accelerate background investigations.
As of this month, the Department of Defense has 1.1 million
personnel enrolled in a continuous evaluation program exceeding
our annual goal. This program has demonstrated clear and
compelling benefits of ongoing and more frequent vetting of
cleared personnel.
These methods, which significantly decrease risks
associated with periodic reinvestigations, have shown
convincing results and provide the basis for new approaches to
modernize the vetting enterprise.
Executing the Section 951 plan will provide DOD with the
unique opportunity to build on our existing continuous
evaluation and automated records checks architecture.
This work will be done hand in hand with the security and
suitability executive agents, collaboratively developing
alternative vetting procedures that ensure continued adherence
to Federal standards.
We are ready to begin this process in early 2018, and
incrementally shift new investigative casework to DOD and
process them through approved, innovated architectures
developed in collaboration with the executive agents.
By optimizing our investments and simplifying service
delivery, we can achieve significant cost savings and cost
avoidance, while, more effectively, driving system efficiency.
As we implement the Section 951 plan, we will remain
committed to our task to design, build, and operate, secure and
maintain the National Background Investigative Service NBIS
that Mr. Phalen referred to. This is the single end-to-end IT,
shared-service solution for all personnel vetting in the
government, not only for NBIB, but for other Federal agencies
that conduct background investigations.
DOD will remain committed to resourcing NBIB and NBIS
throughout this transition process. I think that's an important
point.
We would also continue to work very closely with the
executive agents to streamline the legacy process, the process
that exists today, to continue to identify ways to economize on
field investigative work. We recently proposed and gained
approval from colleagues here and in the Performance
Accountability Council for a series of actions that are
expected to produce near term reductions in the submission of
investigative requests and reductions in field work.
We will continue to collaborate to identify these
additional measures in parallel with our work to implement the
Section 951 plan. And as a result of this work, NBIB will
continue to process every case that DOD has already sent to
NBIB from now and any point in the future. Once we stand up the
951 plan and develop alternative processes that are approved
and vetted, we will route new work into that pipeline. This
will take new work off of NBIB's plate, allow them to focus on
the existing work as we continue to develop automated processes
and feed them back into the overall architecture.
And, chairman, I would be happy to discuss the plan in more
detail, and I look forward to your questions.
Thank you.
[Prepared statement of Mr. Reid follows:]
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Mr. Meadows. Thank you.
Mr. Evanina, you're recognized for 5 minutes.
STATEMENT OF WILLIAM R. EVANINA
Mr. Evanina. Thank you, Chairman Meadows and members of the
subcommittee. Thank you for the opportunity to be here in front
of you today.
As the Director of the National Counterintelligence and
Security Center, NCSC, I am responsible for leading and
supporting the counterintelligence and security activities of
the entire United States Government.
The Director of National Intelligence, DNI, is designated
as a security executive agent. In this role,the DNI is
responsible for the development, implementation, and oversight
of effective, efficient, and uniform policies and procedures
governing the conduct of investigations, adjudications, and, as
applicable, polygraphs for eligibility for access to classified
information.
The NCSC has been designated as the lead support element to
fulfill the DNI's security executive agency responsibilities.
We're responsible for the oversight and policies governing the
conduct of investigations and adjudications for approximately
4.1 million national security cleared personnel.
The security clearance process includes determining if an
individual is suitable to receive a security clearance,
conducting the background investigation, reviewing
investigation results, determining if the individual is
eligible for access to classified information, or to hold a
sensitive position, facilitating reciprocity, and periodically
reviewing continued eligibility.
We work closely with the agencies responsible for actually
conducting the investigations and adjudications, and managing
other security programs associated with clearances.
This ensures that our policies and practices are informed
by those working to protect our personnel and sensitive
information. In addition to supporting the DNI in its role as
security executive agent, one of my other responsibilities is
to support the DNI and the attorney generals' efforts to ensure
that the departments and agencies across the Federal Government
have Insider Threat Programs established to help deter, detect,
and mitigate the actions of individuals who may have the intent
to unlawfully disclose classified information, or possibly do
harm to themselves or others.
The Insider Threat Programs go beyond traditional personal
security practices implemented upon hiring, and offer an
ongoing holistic approach to ensuring the well-being of the
cleared workforce.
These programs help us to be more proactive in preventing
unauthorized disclosures by minimizing potential security gaps
and/or identifying personnel who need assistance in getting
them help before any damage occurs.
The very first step in identifying and preventing an
insider threat is the initial and periodic background
investigation. This application and subsequent investigation,
will continue with the clearance holder as the foundational
assessment throughout the period of time the employee holds
their security clearance.
So the interrelationship between the security clearance
process and the insider threat detection is critical.
NCSC is engaged as a partner with NBIB and the Department
of Defense in the transformation of the security clearance
processes, and remains committed to providing departments and
agencies policy direction, while continuously assessing new
ways for improvement.
We have issued guidance to the community on a broad variety
of topics, which are listed in my statement for the record.
Additionally, NCSC, in coordination with NBIB partners with
Director of OPM, who serves as a suitability and credentialing
executive agent to align the security clearance process for the
national security, suitability, and credentialing. This
collaboration has resulted in a number of achievements, which
are also listed in my statement for the record.
We have also implemented efforts to track and report on the
application of security clearance reciprocity.
Reciprocity, acceptance of background investigations and
national security determinations support the employee mobility
and mission accomplishment, which is a critical element to
ensure maximum effectiveness in human resource utilization.
We are extensively engaged in modernizing security
clearance processes, an effort that includes implementing
continuous evaluation, to conduct automated record checks on a
segment of covered individuals between the 5- and 10-year
periodic reinvestigation cycles when security-relevant
information may go unreported to security officials. CE is
being implemented across the executive branch in phases.
In conclusion, Mr. Chairman, as holders of security
clearances, we are custodians of our Nation's secrets,
protecting the American people by protecting those secrets must
be our highest priority.
I, along with my colleagues sitting beside me here today,
are firmly committed to doing everything we can to address
security clearance investigation challenges, and strengthen our
Nation's security.
I look forward to your questions.
[Prepared statement of Mr. Evanina follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Meadows. Thank you, Mr. Evanina. Is that better than
the first time?
All right. Mr. Hodgkins.
STATEMENT OF A.R. ``TREY'' HODGKINS
Mr. Hodgkins. Thank you, Mr. Chairman, and members of the
subcommittee.
On behalf of the members of the Information Technology
Alliance For Public Sector, I am pleased for the opportunity to
share industry perspectives on the security clearance process
in its current state.
I have to start by saying, I sadly feel like a character in
the movie, Groundhog Day. In the mid-2000's, I testified
several times before Congress, representing industry in what
was then described as a clearance process. It was outdated and
it needed modernization that addressed the backlog that rivaled
the size of today's. It is a testament to how little has really
changed.
The member companies of ITAPS appreciates the attention
this committee is giving the issue. Like other sectors of the
industrial base, the Information Technology Sector relies
heavily on cleared personnel to provide IT goods, services, and
solutions to the government mission.
Unfortunately, the process we use today to grant and
maintain clearances continues to be outdated, and sorely in
need of modernization, just as it was over a decade ago.
This is in addition to addressing the short term issue of
backlog of investigations now numbering over 700,000. To put
that into perspective, that's about the same number of people
you represent in your congressional district, Congressman.
Industry outlined then what we believe was the path forward
to modernize the clearance process, reduce the opportunity for
another backlog to appear, and establish a 21st century process
to protect the interest of the United States.
These criteria were known as the four 1's, and included one
application, one investigation, one adjudication, and one
clearance.
After meeting with stakeholders for almost a year now, we
believe that these criteria still fit today's situation, and
these steps should be used to guide efforts to address the
existing problems in the system.
One application speaks to one singular digital form online
that serves as a basis for a permanent digital security record
for a clearance holder.
One investigation speaks to standardized investigation
metrics and criteria to yield consistent, understandable
findings that can be used across the government enterprise.
It also speaks to establishing real-time, continuous
monitoring as the baseline for tracking clearance holders and
as a replacement for reinvestigations.
One adjudication speaks to a dependable and repeatable set
of standards by which agencies can determine whether an
individual is eligible and suitable to be granted the privilege
of a clearance, and for which a determination can be clearly
understood across the government enterprise.
Finally, one clearance speaks to a dynamic where an
applicant only applies one time for a clearance, is
continuously monitored after it has been granted, and the
clearance is accessible and transferable government-wide. It
would also allow for industry personnel to move from one
contract to another in a reciprocal fashion, all without having
to undergo additional redundant examination.
These criteria outline a reform process that will deliver
and enhance security on a real-time basis, while achieving
maximum efficiency across the Federal Government.
Further, we believe that the reformation of the clearance
process should not just look to catch up and draw down the
existing backlog, but leverage technological advances to create
a new dynamic needs of permitting access to our Nation's most
important information, while securing that information from the
threats it faces.
These technologies includes the application of big data
analytics to the existing and past data set of clearance
holders, to reveal patterns or anomalies that can lead to the
discovery of insider threats, applying blockchain technology,
to secure information and enable trusted information exchange,
and the use of artificial intelligence to monitor trusted user
activity and build trusted profiles.
Finally, industry has consistently supported the concept of
a singular standardized clearance investigation across the
government enterprise, and would oppose efforts like Section
938 of the Senate National Defense Authorization Act, to
bifurcate the process.
Such an action would exacerbate, rather than relieve, the
existing backlog, and enable agencies to silo their behavior
regarding how they adjudicate and reciprocally treat
clearances.
Section 938 would also force the government to compete
against itself, and artificially inflate costs for the most
scarcest resource in the process: the investigators.
Thank you again for the opportunity to share perspectives
on the state of investigations for clearances and how we should
resolve and evolve these issues. We look forward to working
with you to reform and modernize the security process, and I
look forward to answering your questions.
[Prepared statement of Mr. Hodgkins follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Meadows. Thank you all for your testimony.
The chair recognizes the gentleman from Iowa, Mr. Blum.
Mr. Blum. Thank you, Chairman Meadows, and thank you to our
panelists for being here today.
The chairman should not feel bad about mispronouncing
anyone's name on the panel. Last week I chaired a hearing and
the gentleman's name was Mr. Hakes, and my notes said ``rhymes
with cakes.'' So, of course, I addressed him as Mr. Cakes. So
don't feel bad, Mr. Chairman.
Mr. Meadows. Thank you.
Mr. Blum. We currently have a backlog of 704,000
investigations.
What is the goal? I'm a businessman. So I hope we have a
plan. I would like to know what our goal is for that backlog
and by when. Does anybody have that answer? Because I know
accountability is not exactly our strong suit in the Federal
Government, but the voters want accountability.
Mr. Phalen. I appreciate that. Thank you, sir.
I'll take a first cut at this. There is a steady state
inventory level that is about 180,000 cases, and that was where
it was during the late 2007 through 2014 timeframe, before we
lost investigative capacity. And within that inventory, we were
able to complete investigations within the timeliness standards
that are outlined in the IRTPA legislation.
Mr. Blum. Why did we lose capacity?
Mr. Phalen. I'm sorry? When or why?
Mr. Blum. Why?
Mr. Phalen. The Office of Personnel Management terminated
its contractual relationship with USIS, which held about 60
percent of our investigative capacity as a contract company.
Mr. Blum. They were circumventing the contractual rules,
correct?
Mr. Phalen. So I would----
Mr. Blum. Is that correct?
Mr. Phalen. I don't know precisely. I do--I
Mr. Blum. USIS, correct? They were circumventing the rules,
the contractual rules? So I'm glad to hear they were
terminated. In fact, I'm surprised.
Mr. Phalen. Yes, sir. The relationship was terminated with
them, and it was done fairly abruptly, and the individuals who
were working for them, most of them did not come back into the
service with any other contractor. They left the business. And
so, that was about a 60 percent loss in capacity in the space
of just a handful of single-digit weeks, almost overnight. And
it has taken to, now, to build up that capacity, contractually,
and through Federal hires, to get to a number that begins to
approximate where we were in the early fall of 2014, when that
contract was terminated.
Mr. Blum. So do we have a goal?
Mr. Phalen. Goal in terms of?
Mr. Blum. Goal of investigative backlog by a certain date,
we want to be at a certain level?
Mr. Phalen. I have an approximation. We are dependent upon
certain changes in process. Two things will have an impact on
our ability to bring this backlog down.
Number one is hiring investigative capacity beyond what we
have today. And we have commitments from all four of our
suppliers to continue building that capacity to the extent
possible. And if they are able to meet the goals that they have
set for us, it will take approximately 3 years or so to bring
down that inventory number to a manageable level that we want,
perhaps even a little longer. That's without any other
intervention.
The second level of intervention that would make a
significant difference in our inventory numbers and our ability
to hit timeliness goals would be our ability to look within the
population that is already cleared, what is today covered by
periodic reinvestigations, and leverage the advantage we have
with continuous evaluation and other programs that go by
different names, but do the same thing that will allow us,
perhaps, to focus periodic reinvestigations into something that
is less periodic and more focused on individuals that need that
level of scrutiny and rely on the continuous evaluation tools
to give us early warning, give the agencies early warning of
folks that are representing a graver threat and not wait until
the 5-year mark to find this problem. And that would take
inventory out of my organization and allow me to focus my
assets and my resources on what is the most important step,
that first one, which is a baseline development of a level of
trust in an individual first entering the Federal service or
into a classified.
Mr. Blum. So 3 years to get to--would that be like 125,000?
Mr. Phalen. 180,000 is our goal.
Mr. Blum. 180,000.
Mr. Phalen. And our other goal is to meet the guidelines or
the standards of an IRTPA, which is 80 days to complete a top
secret investigation, and 40 days to complete a secret
investigation. And just for clarification, the 3 years is me
being terribly optimistic. It could be an extra 1 or 2 years
beyond that. But that's----
Mr. Blum. The investigations have become much more labor
intensive?
Mr. Phalen. They have.
Mr. Blum. Especially since the theft of classified
intelligence by Edward Snowden?
Mr. Phalen. Yes.
Mr. Blum. Now someone to the investigation has to be face-
to-face versus telephonically? Do you agree with that, or do
you think that's an overreaction?
Mr. Phalen. So actually, investigations have been required
to be face-to-face, for the most part, since when I was doing
investigations, if not earlier, back in the early 1980s. The
default is to do it face to face.
And what we have done with some of our mitigation efforts
working, again, with the security suitability executive agent
and the Department of Defense, is look for those opportunities
where we can use technology, whether it is a telephone, or
something as secure, video teleconference, to get to people who
are in areas that we can't otherwise get to very easily.
Mr. Blum. Can we make it less labor intensive?
Mr. Phalen. Exactly.
Mr. Blum. Can we do that? Is that possible through the use
of technology?
Mr. Phalen. Yes, it is.
Mr. Blum. And that's in our plan, I assume?
Mr. Phalen. The telephonic changes we're doing today. We
have been running pilots with the video teleconference,
particularly getting into areas in combat zones and other
inaccessible zones to get to military members and have that
conversation with them where we can't get an investigator on
the ground. And we've been doing that as a pilot now for
probably 4 or 5 months. It's been very positive working with
the Air Force, and they would like to go more mainstream with
that.
Mr. Blum. And in closing here, I would like to say, though
it's caused you an issue, USIS, that contract being terminated,
I'm glad to hear that, because, to me, that represents
accountability. So thank you for your answers. And I yield back
the time I do not have.
Mr. Meadows. I thank the gentleman. The chair notes the
presence of our colleague, the gentleman from Illinois. Mr.
Krishnamoorthi. You think your name is tough, I ask unanimous
consent that he be fully allowed to participate in today's
hearing. And without objection, so ordered. And so the chair
recognizes the gentleman from Illinois.
Mr. Krishnamoorthi. Thank you, Mr. Chairman.
Mr. Reid, on September 6, 2017, Daniel Payne, the Director
of the Defense Security Services, made headlines when he spoke
at the Intelligence and National Security summit.
This summit was hosted by the Armed Forces Communications
and Electronics Association and the Intelligence and National
Security Alliance.
Director Payne said this, and I quote, ``On a weekly basis,
I got murderers who have access to classified information. I
have murderers, I have rapists, I have pedophiles, I have
people involved in child porn. I have all these things at the
interim clearance level, and I'm pulling their clearances on a
weekly basis. This is the risk we are taking.''
Mr. Reid, are you aware of these statements?
Mr. Reid. Yes, Congressman.
Mr. Krishnamoorthi. Do you agree with him that murderers,
rapists, and pedophiles have been given security clearances in
the past?
Mr. Reid. Congressman, I've spoken, I work for Dan Payne
every day in our jobs. And in the first instance, I would just
submit that immediately after this excerpt was published, we
talked about this in terms of the context of his remarks, and
the most important point he was trying to make, respectfully,
was the impact of interim clearances and the effects of the
backlog.
There are numbers that we can associate with revoked
interim clearances, and we can provide that. I'm not sure it's
appropriate to articulate those publicly. They refer to
different categories of behaviors that are flagged.
There is a volume of some 200,000 interim clearances that
DSS authorize. And the Director can authorize interim
clearances under certain conditions for industry contractors,
about 200,000 a year. Several dozen of those you can map to
some of these behaviors he was describing, but I would just
say, Congressman, again, the description was intended to be
more figurative than literal in terms of murderers and rapists.
There are categories of behaviors that are within the
guidelines that flag clearances. And that is what Dan was
referring to. And we can certainly provide the numbers.
Mr. Krishnamoorthi. Okay. Well, to me, I mean, murder is
murder, rape is rape. In response to these alarming reports, on
October 5, our full committee ranking member, Elijah Cummings,
sent a letter requesting documents about these allegations.
Because of the urgency of this matter, he requested them by
yesterday, but so far, we have not received anything. No
documents, no briefing, no responses at all.
Why is that, Mr. Reid?
Mr. Reid. It's my understanding, Congressman that the
Department is pulling a response together, and I'll have to
verify, when I get back, exactly where it is and when it's
coming over. But I am fully aware they are developing the
response requested from the chairman.
Mr. Krishnamoorthi. We want to know when we can expect to
receive this information, sir.
Mr. Reid. All right, sir. I'll take that back to the
building as soon as I get out of here and we'll track it down.
Mr. Meadows. Excuse me. If the gentleman will yield for
just a second?
Mr. Krishnamoorthi. Sure.
Mr. Meadows. I mean, he makes a valid point. If there was a
deadline for yesterday, and we're talking about security
clearance backlogs, and you're having a hard time responding to
a simple request from the ranking member, at what point are we
going to get a response. Do you have staff here with you today?
Mr. Reid. Sir?
Mr. Meadows. Do you have staff here with you today?
Mr. Reid. Do I have my staff here, sir?
Mr. Meadows. Do you have some staff here with you
accompanying you here today?
Mr. Reid. We have our legislative liaison, sir.
Mr. Meadows. Let them check while we're going through the
interview process. I'm sure that we would love, both in a
bipartisan manner, to have some kind of update on when he can
expect it.
Mr. Reid. Yes, sir.
Mr. Meadows. I'll yield back and I'll extend your time.
Mr. Krishnamoorthi. Thank you. Thank you, Mr. Chairman. And
I echo the chairman's sentiments. You know, we would, you know,
respectfully request that these documents be provided within 48
hours at this point. It shouldn't take longer than that.
Do you understand my request?
Mr. Reid. Understood, sir.
Mr. Krishnamoorthi. What risk does this pose when you allow
criminals with those different behaviors, like the ones
Director Payne described, to have access to classified
information, sir?
Mr. Reid. I'm not sure if I understood the question. The
suggestion is not that known criminals are granted
clearances;the clearance-granting guidelines are consistent.
The comment was aimed at behaviors that occur once people are
in the workforce, and they create certain violations and their
clearances are revoked. It's not the other way around. It
wasn't a comment that a murderer is granted a clearance. The
comment is someone with a clearance exhibits a certain behavior
that breaks the threshold that's allowable. And it could be of
any category. It's not, you know, murder is not the only
category. That's obviously a very powerful category. There are
other behaviors when the guidelines that one's clearance will
be suspended.
Mr. Krishnamoorthi. Now, if there's a backlog in processing
these people, and they have committed these behaviors and they
have clearance, that poses a risk. So what kind of risk does
that pose?
Mr. Reid. Well, again, there is not a backlog in
identifying behaviors that break the threshold and raising
those up for adjudication as soon as they are discovered. That
is, that is not the context of the backlog.
When we're referring to a backlog, we're talking about
cases that are in an open investigation. Your commentary,
Congressman, we're talking about people that are in the
workforce, in this case, with an interim clearance, they
exhibit a certain behavior, it raises a threshold as soon as
it's reported. Those aren't backlogged.
Mr. Krishnamoorthi. So somebody who has committed these
behaviors could be on interim clearance, correct? It's not
automatically revoked or anything like that. It goes through an
adjudication?
Mr. Reid. The revocation process is the same for everyone.
If the behavior becomes known, when it becomes known, it is
reported through the security managers and raised up for a
decision. Again, there's different categories of behaviors, but
they all get acted upon. That is not a phenomenon--the backlog
phenomenon we're referring to is not associated with flagging
of behaviors.
Mr. Krishnamoorthi. Mr. Phalen, let me just turn to you for
a moment. Do you have an estimate of how often the government
relies on interim clearances as a result of the current
backlog?
Mr. Phalen. I have an estimate, based on information I've
received from the Department of Defense. And I think Mr. Reid
just mentioned, there's as many as 200,000 today in the
Department of Defense that are carrying an interim clearance,
which is, essentially, all the national level, and to the
extent we can capture them, local name checks and other
electronic information that we can capture; plus no indication
of misbehavior on the application to start with. And that
allows them to put him in an interim clearance status pending
the complete outcome.
Mr. Krishnamoorthi. Thank you.
Mr. Meadows. I thank the gentleman.
The chair recognizes himself for a series of questions. So,
Mr. Phalen, would you say part of the reason why Mr. Reid is
wanting to take over is because you have such an extraordinary
large backlog in clearances.
Mr. Phalen. I think the backlog in clearances has been a
significant catalyst in people asking how to reexamine, how to
rethink the process of doing clearances. And certainly----
Mr. Meadows. So what hope would you give Mr. Reid that
you're going to get it fixed? Because if you're not--listen,
I'm agnostic in this in terms of whether it's you or Mr. Reid,
but I am not agnostic in terms of it being both.
Mr. Phalen. No, I understand.
Mr. Meadows. And so at some point, we're going to have to
get serious about the backlog. You know, Mr. Hodgkins says it
was Groundhog Day all over again. And what I don't want is
another hearing a year from now to find that the backlog is
still at 700,000-plus. So what are you doing to alleviate Mr.
Reid's concern?
Mr. Phalen. So fair question. So, number one, assuming we
are left to our own devices here to work off the backlog and to
work for the future, is to build the capacity and work within
today's guidelines to reduce the levels---
Mr. Meadows. So why haven't you done that already?
Mr. Phalen. We are working on that. We've increased----
Mr. Meadows. I understand it's a work in progress.
Mr. Phalen. Right.
Mr. Meadows. But we're at 700,000.
Mr. Phalen. Yes.
Mr. Meadows. So why have you not put that--I mean, how can
you be more aggressive, I guess, may be a better way to phrase
that on alleviating some of the concerns?
Mr. Phalen. So continuing to grow that capacity, which,
again, and we've seen from experience, that the growth in
investigative capacity is the single biggest positive effect
upon reducing the backlog and getting to timeliness.
The second piece is working very hard, and we've gone
through two cycles of this now, in finding opportunities to
reduce the level of effort that is required without
compromising our virtues, but reducing the level of effort
required to complete a clearance. And I would say, the third
thing that we are beginning to work on, and this is a
collective agreement amongst all of the principals, and I think
one or two of the speakers already mentioned, is that we need
to look at the future and fundamentally ask ourselves how do we
do this differently?
Mr. Meadows. Well, but Mr. Hodgkins made the point, he said
that you should have looked at that 10 years ago.
Mr. Phalen. Sir, I wasn't in this role 10 years ago, but
he's right. I would perhaps argue we should have look at this
longer than 10 years ago. I have found evidence----
Mr. Meadows. So what you're saying is you're new to your
role and you're taking this serious and you're going to make an
effort to accommodate and make sure that Mr. Reid gets the
security clearances that he needs?
Mr. Phalen. The short answer is, that's exactly why I came
back into the Federal service to do that task.
Mr. Meadows. All right. So Mr. Reid, let me come back,
because I think there was a little bit of cross-talk between my
colleague here to my right and what you were saying. He was
talking about interim security clearance. You said that there
was, what, 3 dozen? Several dozen? Several dozen?
Mr. Reid. Of the 200,000 interims that were granted by DSS
in 2017, there were some number--I don't have it--I can look it
up here, 100-plus or so that fell into the revocation status.
And within those categories, single and some double-digit
numbers that refer to sexual misconduct, criminal behavior,
that's what I was trying to characterize to the Congressman.
Mr. Meadows. So, but on an interim basis, would not a
normal background check have picked that up?
Mr. Reid. Again, these are behaviors that are occurring
after they are granted.
Mr. Meadows. Well, but the very definition of interim is
that you're actually going into a setting where you're getting
a security clearance. And so as we look at that interim basis,
that's what I'm saying, your testimony and what he asked
doesn't seem to be jiving. Because I've got several employees
that are now working for the administration that are on interim
security clearances. They left my employment and they went to
work where they had to get a security clearance. Well, you
would think at that particular point, when they get an interim,
they would do a normal criminal background check. So did you do
criminal background checks on all of those people?
Mr. Reid. Everyone that is granted an interim is granted an
interim only when they submit a request for a clearance. And as
Mr. Phalen said, if their initial screen comes up with nothing
derogatory, and I don't want to get technical, but if they meet
the bar of no derog, they can be granted an interim clearance.
And it depends on what job they're in. It's not uniform across
even DOD----
Mr. Meadows. No, I get that.
Mr. Reid. They're still--their investigation goes into the
queue. And that investigation will run its course and come back
final, once it's adjudicated. Within that time frame, if people
misbehave----
Mr. Meadows. This isn't any first rodeo, I get that.
Mr. Reid. Okay.
Mr. Meadows. I understand the process.
Mr. Reid. I'm sorry, if I'm not understanding----
Mr. Meadows. What I'm saying is, is before you give them an
interim clearance, do they pass just a normal criminal
background check?
Mr. Reid. An initial check, yes, sir.
Mr. Meadows. All right. So every one of those people that
he had on the list, passed a criminal background check?
Is that your----
Mr. Reid. Yes, sir. The initial checks. The initial layer
of checks, with nothing derogatory, you may grant them an
interim.
Mr. Meadows. All right. And so how do you find this? Was it
when they got their security clearance?
Mr. Reid. The behaviors occurred after they were granted
clearance.
Mr. Meadows. So you had murderers and all of that after----
Mr. Reid. The examples of misbehavior were in the context
of Mr. Payne's comments, things that were occurring to people
that had been granted----
Mr. Meadows. So they weren't missed in your interim
clearance?
Mr. Reid. Correct.
Mr. Meadows. Every one of them?
Mr. Reid. Best of my knowledge, sir.
Mr. Meadows. All right. Well, that's why it's imperative
that you get the kind of information to the ranking member that
he requested. And so I assume--I'll give you just a second to
turn around to your staff. Is somebody working on that to get
us a response?
Mr. Reid. Working on it, sir.
Mr. Meadows. All right. Very good.
So Mr. Reid, what makes you think that you can do it better
than Mr. Phalen?
Mr. Phalen. I appreciate that question, sir.
Mr. Meadows. This is softball. This is your chance to hit
it out of the park.
Mr. Reid. I appreciate it.
Mr. Meadows. And if you swing and miss, it's going to have
consequences. So go ahead.
Mr. Reid. Don't you know it. I appreciate it.
It's not 10 years ago. What's different now, and what's
only in the last few years made available to us, is the ability
to fuse multiple sets of data, data that have been put in place
as a result of incidents, some of which were referred to, Navy
Yard, Fort Hood shooting, Snowden, Manning.
We have a large enterprise within DOD for an Insider Threat
Program. We have, at the component level, 43 subcomponents in
the Department have Insider Threat monitoring programs.
We have a continuous evaluation program that I've been
exercising on a slice of the Department of about 500,000. We're
going to be at a million very quickly. We bring in data sets--
--
Mr. Meadows. So now is this the check that maintains the
clearance that you're talking about it?
Mr. Reid. The check that used to maintain the clearance,
right, correct,
Mr. Meadows. This is not the initial one, this is actually
on the maintenance?
Mr. Reid. Well, it could be both. What we are professing--
--
Mr. Meadows. I understand what it could be. I'm asking what
it is.
Mr. Reid. Today we have used our continuous evaluation
programs that we're conducting only on a sample basis to
actually highlight behaviors that triggered revocations far in
advance of when the next periodic review would have been.
That's proven itself. Our continuous evaluation program, we ran
pilots over the last several years. We took a completed
investigation. We took a CE data set and said, ``could you have
done this investigation the same way using CE?'' And we got
over 95, 96 percent correlation of things that were found. So
we've been proving----
Mr. Meadows. So do you have a technical background? So are
you an IT guy?
Mr. Reid. Me, sir? No, sir.
Mr. Meadows. Okay.
Mr. Reid. We have IT guys.
Mr. Meadows. Do you know what blockchain is?
Mr. Reid. I'm not 100 percent familiar with that term.
Mr. Meadows. All right. Mr. Phalen, let me skip before I
let you finish off here. Because, you know, he's making some
points, and so at what point would you disagree with that?
Mr. Phalen. To the points he made, I do not disagree with.
Mr. Meadows. So you think that he should have that ability?
Mr. Phalen. So I think he has that ability. He has that
responsibility right now to conduct continuous evaluation.
Mr. Meadows. So if we took resources from you and gave it
to him, are you saying that he could do a better job than you
could?
Mr. Phalen. No, sir, I'm not saying that.
Mr. Meadows. Okay. I just want to make sure. That was a
softball to you.
Mr. Phalen. Okay. I misunderstood the question, sir, I'm
sorry. And I'm not sure if the Representative from Illinois is
a Cubs fan or not.
Mr. Meadows. He is. You just--not a swing and a miss. You
did good. Go ahead.
Mr. Phalen. Okay. What I believe Mr. Reid is referring to
is the use of continuous evaluation to monitor individuals near
real time in the workplace. This is different than what is
today's model, which is to use periodic reinvestigations at the
5- or 10-year level, which is something that is done externally
by my organization.
I believe that much of that work can be supplanted by,
after due consideration by much of the continuous evaluation
that is required and being done within the Department of
Defense, the intelligence community and a lot of cleared
industry right now. And that that can be leveraged against the
requirement to do periodic reinvestigations, and that those
resources that are currently involved in periodic
reinvestigations within my organization, or in any
investigative organization, can be redirected towards the
initial evaluations to work with those people who have not yet
been cleared and focus our energies on that.
Mr. Meadows. Okay.
Mr. Evanina, I got a note here that said, I guess the
rollout of the continuous monitoring program that was
originally for, I guess, October of 2016, that you were going
to roll it out in phases, or it was being rolled out in phases.
I mean, what are the barriers to making sure that it goes
government-wide?
Mr. Evanina. Sir, that's a good question. None. We are
completely on schedule with our CE program. And it's important
to back up a sec and talk----
Mr. Meadows. Hold on. We may have news breaking here.
You're saying there are no barriers and you're on schedule?
Mr. Evanina. We are on schedule.
Mr. Meadows. That is, let me just applaud you, because
that's probably one of the first times I've ever had in one of
these hearings where I've gotten both ``there are no
barriers,'' and ``we're on schedule.'' So kudos to you. Go
ahead.
Mr. Evanina. Thank you, sir. But it was not without
pain,I'll grant you that, to get to where we are now. But I
think we need to step back a little bit and talk about what
continuous evaluation is. We decided a few years ago to split
it up into government. And what DOD's continuous evaluation
program has been successful at this point is germane to DOD.
And what Mr. Phalen and BIB are doing is germane to their
processes. But we were doing at NCSC is providing a service to
all executive branch agencies to opt into our continuous
evaluation program to allow agencies to use our services for a
couple reasons: Efficiencies of scale and cost, as well as
provide agencies outside the intelligence community who don't
have the ability to procure these services to have the
opportunity to get them from us, whether they are one of the
top seven or eight databases we check. So this is in all-of-
government executive branch program that we're facilitating.
Mr. Meadows. Mr. Hodgkins, I'm going to ask you one
question before I recognize the gentleman from Illinois for a
second round of questions. So we talked a little bit, or you
mentioned in your testimony blockchain. And for those of us
that are not technically savvy, fortunately, I have a brother
that can tell me about blockchains and the secure way that we
can communicate and compartmentalize that. So as we look at
that--other that blockchain, what are some of the other
technology aspects that we could actually deploy, whether it is
at DOD or OPM that would help streamline this?
Mr. Hodgkins. Well, the other suggestions I made in my
testimony referred to artificial intelligence. So the----
Mr. Meadows. For most of us, that's a danger. We get
concerned when we hear about artificial intelligence. It is
kind of--well, I won't go there.
Mr. Hodgkins. The commercial analogy I can point to, sir,
is the financial services and how they monitor your credit. And
if there is behavior that appears to be fraudulent on an almost
real-time basis, you're notified of that. They are asking you,
is this you making this transaction, if you travel somewhere
out of the ordinary.
Mr. Meadows. So why have we not deployed that today in this
realm?
Mr. Hodgkins. Well, as the other panelists have identified,
they are beginning to roll that out, but it is something that
industry called for over 10 years ago, suggesting that that
move to replace the periodic reinvestigation process eventually
began as, I think Mr. Phalen noted, and Mr. Reid noted, that
there are high degrees of compatibility, or alignment with the
manual reinvestigation of an individual and using the automated
processes and what they find, which has always been the
question in using this capability. Do they find the same
things? Will we still find the same bad actors, and identify
them for the same reasons?
So it is heartening to hear that that is the direction they
are moving and that they are making advances and there are no
obstacles. But using those capabilities in the way the
financial services market does for credit monitoring, for any
individual, is an example we would point to, an analogy we
would point to, about how this could be deployed to look at
things like criminal histories, although those are poorly
automated across the country, particularly at the State and
local level. We can look at marital records; we can look at
financial records; and then we can look at other databases that
are out there, either commercially available or in the
possession of the government.
And Mr. Evanina noted they are looking at several, and we
can continue to identify and tie into and bring online
additional data sets that would reveal other flags about
someone who holds a clearance, and we think we should continue
to push out in that direction.
Mr. Meadows. All right. So the chair recognizes the
gentleman from Illinois for a second round of questions.
Mr. Krishnamoorthi. Thank you, Mr. Meadows.
Mr. Phalen, as the NBIB director, I don't think it is an
exaggeration to say that you are a key player in our national
defense and counterintelligence apparatus, making sure that the
American people can trust secrets to remain secure is a vital
task. Now, the security clearance process, as we all know,
relies heavily on the proper completion of the standard form
86--SF-86 form. And as you know, complete valid and accurate
answers to the questions on this form are vital for the
security clearance process.
What does the NBIB, or any other background investigative
agency, do to ensure that the information on an SF-86 form is
accurate? You don't take applicants merely at their word,
correct?
Mr. Phalen. Generally not. Much of the process is to
validate that the information on the form is correct, both in
terms of locations they worked, locations they lived, their
claims of either some or no criminal involvement. Essentially
they are explaining their life on this form, and our goal is to
go validate that they have been correct in that, and to seek
other information where it appears that it may be incorrect.
Mr. Krishnamoorthi. And, obviously, everybody makes
mistakes. Let's say I made a mistake on the SF-86 form. I'd
have a chance to correct it. Is that not right?
Mr. Phalen. So in the subject interview when an
investigator is speaking to applicant, going over the form, and
talking to them about things, if there is a mistake to be
made--that has been made, it can be corrected. And the agent
will put that into the investigative report and that will be
captured. What that mistake is may be dispositive of how much
further we're going to dig. If it's something simple like the
middle initial being wrong or I got the dates wrong in the
years I was in high school, not a big deal. But if I forgot to
mention a significant felony conviction, that would be far more
substantive and we would want to go pursue that a lot further.
Mr. Krishnamoorthi. Ah-ha. Forgive me, I'm new to
government. I spent most of my career as a small businessman,
so I'm going to ask you some really perhaps some simplistic
questions in your world. But what if I were to make several
errors with my SF-86 form, not just one, but a bunch? What
would happen in that instance?
Mr. Phalen. Again, it would depend on what kind of errors
they were. One of the concerns we have had is in the current
form the electronic SF-86, is to use technical talk, a little
bit kludgy and can be prone to some level of people making
mistakes, and so we take that into account. In fact, we are
working together with other elements of the government to build
an new electronic application form that is far more user
friendly, and will lead to less errors on the front end, and
even perhaps do some fact checking on behalf of the applicable
doing it. To answer your question, if it was a number of
errors, it would depend.
Mr. Krishnamoorthi. I mean, how many do--what if there are
errors, even in my correction, how many do-overs do I get?
Mr. Phalen. Fair question. Ultimately, we would capture the
information as much as we could capture from the applicant and
try to verify it. At some point, we will make a decision to
send the information to the adjudication facility that it makes
the ultimate decision about whether an individual gets the
clearance and let them judge for themselves as to whether they
think this is too much or not too much.
Mr. Krishnamoorthi. I understand. This isn't a hypothetical
situation. As you know, senior White House advisor Jared
Kushner submitted four addendums to his security clearance
paperwork after his original SF-86 forms contained more than
100 errors and omissions. Mostly related to the failure to
disclose foreign contacts. Retired General Flynn failed to
disclose payments of over $600,000 for his work representing
authoritarian regimes in Washington. Both were approved for
their security clearances. What would you do if one of your
employees approved such an incomplete form?
Mr. Phalen. So I'd un--working in the hypothetical, without
using any particular subjects on this, if the investigator did
not--if the applicant said, I didn't do this or I never--or
failed to report it, the question would be how does
investigator find it was failed to be reported? And if the
investigator discovered that it had been failed to be reported,
the first step would be to go back and try to understand what--
why it was missed and what was missed and capture it again.
What I don't know in the particular cases you're talking about
is we have no visibility in our organization to any of those
activities. Those are done by other organizations, what that
meant. But there would be a point when an adjudication
facility, an adjudication organization, has to take into
account those mistakes. It is not our decision to make that
decision. It is not in our purview to make that decision. We
simply report what we know and how many addendums there may be
to a report, to report that.
Mr. Krishnamoorthi. Is there ever an instance where someone
can command you to fast-track the verification of an SF-86
form?
Mr. Phalen. It depends how you define fast-track, sir.
Mr. Krishnamoorthi. Cut corners, fast track, get it
through, ram it through the system.
Mr. Phalen. Cutting corners, no. So if people ask us to do
things, to put things ahead of queue, yes, we do that all the
time. To cut corners, we do not do that.
Mr. Krishnamoorthi. Can you recall if there's ever been an
application having to submit four addenda detailing over 100
errors and omissions being able to maintain their security
clearance once those errors and omissions had been identified?
Mr. Phalen. I will caveat that by saying I have not seen
the breadth of all the applications, but I have never seen that
level of mistakes.
Mr. Krishnamoorthi. Neither have I. It's clear that there
is a lot more ground to cover on this. Mr. Chairman, you are
doing a great job here. I hope that you will convene further
hearings on this subject, because it really bears
investigation. Thank you, sir.
Mr. Meadows. I thank the gentleman from Illinois.
The chair recognizes himself for a series of follow-up
questions. So Mr. Reid I interrupted you when you were making
your closing remarks on why you would do such a fantastic job,
so I will go ahead and let you finish.
Mr. Reid. Thank you, Chairman. To continue, the DOD plan we
talked earlier about goals, our plan is to alleviate the burden
on the backlog in the near term by shifting that work into an
alternative process, focusing on the secret level
investigations. We submit about 700,000 investigative cases to
NBIB every year, about two-thirds of those are at the secret
level, initial or reinvestigation. Based on the strength of the
continuous evaluation, automated records checked and the fusing
of all these data sets that we have already built within the
Department to monitor performance and behaviors and spot
anomalies, we are prepared, as early, starting in January, to
work with the executive agents to get approval to use these
systems as systems of records to meet the performance
requirements, the Federal standards required to approve a
secret level clearance.
Doing that--so that process we'll start in January, we
envision within a few months, having those approved. We turn
off the spigot of new secret cases. Again, this is about
500,000 a year that go to NBIB. We will incrementally do this,
alleviate the pressure valve on their system, allowing the
capacity they already have to focus on the workload they
already have and to prove this system as we build it. It's a
phased process focusing initially on the secret.
More than 90 percent of NBIB secret cases are DOD. This is
very much a DOD issue. Almost every servicemember--in fact,
every servicemember is cleared at the secret level upon entry
into the service. So we have a very high volume, and we feel
like the risk--the risks associated with this, knowing that we
have proved and piloted systems, it is worth taking the next
step to take the pressure off.
Mr. Meadows. Tell me about the pilot.
Mr. Reid. We ran pilots for several years in DOD.
Mr. Meadows. How many people?
Mr. Reid. Total that we piloted actual cases on, it is in
the hundreds of thousands. And we have enrolled----
Mr. Meadows. And you were able to complete those how
quickly?
Mr. Reid. We put the pilots in place, we ran them for
periods of 6 months at a time. For instance, initially, we took
a slice of people----
Mr. Meadows. So how much faster than Mr. Phalen is doing
it?
Mr. Reid. Well, they are not doing it at all presently but
we are----
Mr. Meadows. Because--I would beg to differ on that
particular thing. So how much faster than Mr. Phalen? Mr.
Phalen, are you doing that?
Mr. Phalen. So, I would probably need to clarify whether we
are talking about initial investigations or periodic
reinvestigations.
Mr. Meadows. I think we are talking periodic re----
Mr. Reid. Initially, secret level periodic going within 2
years to initial secret.
Mr. Meadows. Right.
Mr. Phalen. So currently we are running the same automated
checks through our system, what we have to do under today's
process.
Mr. Meadows. So you're shaking your head no. Is he not
doing the same automated checks? You are both sworn testimony.
So is--Mr. Phalen, are you doing those automated checks?
Mr. Phalen. When you put their system and ours side by
side, we are doing the same automated checks.
Mr. Meadows. Mr. Reid, you're shaking your head no.
Mr. Reid. When we implement the DOD plan, which we want to
start in January, the initial phase of that is to gain
additional approvals. That's the part where I said what we are
proposing to do isn't that same as what's being done today.
Mr. Meadows. So you pilot program--is he doing the same
thing--in your pilot program, did he do the same thing?
Mr. Reid. Today those things are being done based on the
pilot.
Mr. Meadows. Yes or no, just tell me yes or no. In your
pilot program is he doing the same thing that you did in your
pilot program?
Mr. Reid. Not to my knowledge.
Mr. Meadows. Mr. Evanina, is he doing the same thing?
Mr. Evanina. Sir, I'm not sure of the fidelity of both
programs to answer.
Mr. Meadows. Sure, I'm all ears.
Mr. Reid. We are not using these systems now as systems of
record to complete investigations, and neither, I believe, is
NBIB. We have data available. We have employed methods of
automated records, checking and seeing. We have not implemented
those as a system that can grant, one, a completed
investigation. That is the step that we want to take in----
Mr. Meadows. So how do you know that that will work?
Mr. Reid. I'm sorry?
Mr. Meadows. How do you know that that will work?
Mr. Reid. Because we have run the test and run the pilots.
We feel----
Mr. Meadows. No. How much quicker are you doing things than
OPM?
Mr. Reid. We will implement this starting in January,
within the first 12 months, we have a three-phase plan. By the
end of the first phase, we believe we will reach a point where
there will be no more secret reinvestigations, which is about
300,000 a year that will not go to NBIB, made the first year.
Mr. Meadows. A critical thing, you said ``we believe.''
What quantitative data do you have to support your belief?
Mr. Reid. The data would be based on the pilots, and the
testing that we've done, and our confidence in our executive
agents.
Mr. Meadows. Confidence is not quantitative.
Mr. Reid. You're correct, sir. We have tested these
systems, and we believe they are ready to be implemented. We
have to work with the executive agents to gain their approval
to implement them.
Mr. Meadows. Mr. Phalen?
Mr. Reid. It will be done much faster.
Mr. Meadows. Mr. Phalen, do you agree with that? Can they
do it better than you can do it? Here is the thing, is my
problem, and actually it has been mentioned over here, moving
something from one bucket of the government to another bucket
of the government does not necessarily create more efficiency.
It--generally, it does not. And so I am skeptical that we are
going to get all these unbelievable efficiencies just by moving
it from one government agency to another. And what we're going
to do is end up with duplicative services, and I'm all about
shared services, you can Google it and you can figure out where
I am on that. I am all in. But what I'm not about is allowing
DOD and OPM to do the same thing when, Mr. Phalen, you said
that the basic problem that you have is getting talent to
actually do these checks. Is that correct?
Mr. Phalen. To do the checks that involve a human-on-human
interaction, yes.
Mr. Meadows. So how are you going to fix that, Mr. Reid?
Mr. Reid. The efficiency, sir, it is a three-part process.
There is submission, investigations and adjudications.
Mr. Meadows. So would you submit that DOD is a model of
efficiency?
Mr. Reid. I'm suggesting that putting submissions,
investigations and a adjudications under a single agency is
inherently more efficient because of the ability----
Mr. Meadows. If that's your argument, then we would put it
all under OPM.
Mr. Reid. Well, sir, because the level of data that we
intend to bring into this process resides within our components
and there's data--monitoring data that is not readily
exportable to be outsourcing the readiness of the Department of
Defense. We have an opportunity because of the maturation of
these programs, these insider threat and CE programs, this is
the first opportunity we've have to bring all of this under an
integrated architecture. And it's----
Mr. Meadows. So in your pilot, what did you figure out that
you didn't do well?
Mr. Reid. We--it was mentioned earlier, solely relying on
electronic data sets, there are gaps in State and local law
enforcement flags that, to the best of our piloting, we can't
reach out into every county jurisdiction in real time and find
out something happened last night. Okay?
So the next step is to continue to bring in all--as many
sources as we can, and with the right algorithms and we are
using our innovation offices to develop these processes, to see
how far you can go before you have to actually get to somebody
knocking on somebody's door. We've never proven that nobody
ever needs to knock on anybody's door. But with the secret
level of checks--the top secret is definitely harder, but at
the secret level, we have enough experience in this to be
prepared to recommend to the executive agents that it is a
suitable alternative process to meet the intent of the Federal
guidelines doing the checks to verify the veracity of the
individual's application and the reliability of the individual,
a large majority of that at the secret level initially.
We believe we can get further, but we're focused on secret
up front. That's the largest piece of work we give them, that
that data is in the Department already, we don't think it's
necessary to build a separate process to send it somewhere. We
are building the entire end-to-end IT system, that was already
the DOD task from the review that created NBIB. That is a DOD
system. It is a DOD system with DOD data. The missing piece is
our investigative responsibility relies there. But it is not a
bifurcation. They do 100 agencies. There are 23 other agencies
that do what we're asking to do.
Mr. Meadows. Mr. Phalen, I mean, Mr. Reid's making a
compelling case. I mean how do you respond?
Mr. Phalen. I respond on a couple of threads. I think we
are in complete agreement. Where I would concur with what his
statements are is that in the realm of the periodic
reinvestigation, there is information within each agency that
has responsibility for the folks in that agency that are
cleared, whether staff or contractor. They all have information
that generally is not available to our investigators when they
are doing----
Mr. Meadows. So you're saying that they are better suited
to do that?
Mr. Phalen. I think any agency is better suited to work on
those and people that are already inside the organization. They
will have a better optic----
Mr. Meadows. So what are they not better suited at?
Mr. Phalen. I defer whether it is better suited or not
better suited, but for----
Mr. Meadows. No. I'm asking you for your opinion. I mean,
Mr. Reid gave me his opinion very clearly. If not, you're going
to have a missed opportunity here. I want to have your opinion.
Mr. Phalen. We have both an electronic and a geographic
reach that is across this country, and for any initial
investigation at whatever level, tier one through tier five, we
have the ability to reach out, real or near real time, to find
information. They don't have that capacity today.
Mr. Meadows. How would you get that, Mr. Reid?
Mr. Reid. We have 43--40-something field offices under the
Defense Security Service in the United States, we have
combatant commands in investigative capacities stationed all
over the world.
Mr. Meadows. But that doesn't make you efficient.
Mr. Reid. No. But that's how we would cover the same
ground. We have field offices, others have field offices, we
have a robust----
Mr. Meadows. So Mr. Phalen, I may have misunderstood you.
Is it your presence that allows you to do that, that you have
multiple locations, because that's what Mr. Reid is saying. I
didn't think that's what you were referring to.
Mr. Phalen. So it is both electronic presence where we can
get information electronically, and it is physical presence at
86 field offices around the country, and folks stationed at
overseas locations to do this work. And that's what allows us
to get the local records, and to what is a key piece,
particularly to a periodic reinvestigation as it exists today
within the process and any initial investigation, that there is
a human-to-human interaction at wherever that person is, and
that is literally geographically around the country. And we
have that presence today with accredited, training, fully
capable investigators, both staff and contract.
Mr. Meadows. So how long, Mr. Reid, would it take you to
get up to speed to match that capacity?
Mr. Reid. So our plan is the 36-month plan. We would phrase
in incrementally over the 3-year period, so by the end of year
3, our plan would be complete. We would have the capacity and
the processes.
Mr. Meadows. So how much quicker will you be able to do
background checks for DOD, Mr. Reid?
Mr. Reid. We would eliminate the reinvestigation, so that's
a zero.
Mr. Meadows. I'm looking for----
Mr. Reid. Let's remove that completely. The goals for the
government----
Mr. Meadows. You don't remove it, you just move it.
Mr. Reid. Well, it just happens contemporaneously.
Mr. Meadows. But if Mr. Phalen had the same kind of
operation, where it is ongoing, similar to what Mr. Hodgkins is
talking about from the technology standpoint, I mean it's a
distinction without a difference.
Mr. Reid. We see no reason why we cannot hold ourselves to
the standards and the goals that we set, which for instance is
80 days for a top secret clearance that is currently taking
350.
Mr. Meadows. So your sworn testimony today is that if we
allow you to go forward and do this, and we appropriate the
dollars to do this, that you can do this at less cost than Mr.
Phalen, and make sure that you get it done in 80 days versus
300?
Mr. Reid. The cost savings and cost avoidance would be and
the reduction of reliance on field investigative work, which is
the most resource intensive. Our testing shows us that we can
go a very long way towards eliminating, but not completely
getting rid of it. The 80-day standard, which has been achieved
in government since it was established, it is being frustrated
by the lengthy field work. So our rationale is if you get rid
of the reliance on the field work, even increased field workers
is still more field work. The goal--the DOD objective is to
reduce, as much as possible, a 90-plus percent level, the work
effort required by a field investigator, and our planning basis
is that lowers, that's a cost avoidance issue and there is it
no reason to think we cannot operate within the standards that
we've already set.
Mr. Meadows. Mr.--so let me go ahead bring this to a close,
and I guess with a few to-do items.
Mr. Phalen, I would like for you, within a 30-day period,
to get back to this committee, what are the three major
concerns that you would have, other than just shifting
responsibility from OPM, what are the three major concerns that
you have in allowing Mr. Reid to go forward with his plan? All
right? Can you do that?
Mr. Phalen. Yes, sir.
Mr. Meadows. Mr. Reid, you've had probably more direct
questioning today than perhaps you're used to. And call me, you
know--we get all kinds of people that come in and testify on a
regular basis, and I hear every wonderful story on why it is
going to be better, and very seldom do I hear a comment like
Mr. Evanina gave me on the excellent work that they are doing
and the fact that they are on time and not having roadblocks.
And yet, I get to visit Federal workers in a number of agencies
across the spectrum, and we have great Federal workers. So it
is not to question anything in terms of your intent. My
question is, is sometimes long before what you believe that you
can do and actually doing it, there are all kinds of roadblocks
that you run into. Some of those many times are financial. And
so the last thing I want you to do is to give sworn testimony
here today only to find out that all we're doing is shifting it
from one agency to another, and that you're going to come in
and ask me for more money and more resources to meet that 80-
day goal that you have in mind.
So here is my three asks of you: I want you to identify
what duplicative services that you would potentially have with
OPM if you instituted your plan policy. The other two things is
what two things do you not--would you not do as well as OPM
under this rollout. Is that something you could provide to this
committee in 30 days.
Mr. Reid. Yes, sir.
Mr. Meadows. And the quicker you can get that to me,
because decisions are going to be made on NDAA, even before
those--I mean, we're going to conference here soon. And so, Mr.
Reid, to be fair to you, I want you to make a compelling case,
even if you need to come in and do a briefing with our
committee on why it is important to you that things perhaps--
because I can tell you your staff has been passing notes back
and forth, they are going back and forth doing that, don't ever
play poker, but in doing that, they've got all kinds of things
that they wish you had said or hadn't said or as we look at
that--so as you do that, as your team gets together, I would
encourage you to actually come back and brief our committee.
Mr. Phalen, I would encourage you the same way. There's going
to be some decisions that are made very quickly here on this
particular issue. I apologize to both of you that most of the
focus has been over here, but sometimes that's the way that
things happen when you have this. Again, I appreciate both of
you being here as witnesses. The only item--and I see they've
passed you a note so are we--when can the ranking member expect
those documents?
Mr. Reid. So----
Mr. Meadows. Within 80 days?
Mr. Reid. Friday, sir, Friday.
Mr. Meadows. Friday is fine. That would be great. I
appreciate it.
I appreciate all of your testimony. Listen, there is
nothing more important than getting this right, and getting it
right quicker than what we're doing now, Mr. Phalen. I mean,
the backlog is, quite frankly, unacceptable. And we wouldn't be
having the hearing today if I wasn't hearing it from across the
board. That is not to impugn the fine workers at OPM. I
understand you didn't create the bureaucracy, but you are here
to fix it. And if we can get this fixed, even if it is in a
combination of things, I'm all in and all ears. But I thank you
all. If there is no further business, the committee stands
adjourned.
[Whereupon, at 3:30 p.m., the subcommittee was adjourned.]
APPENDIX
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