DOD Personnel Clearances: Additional OMB Actions Are Needed to	 
Improve the Security Clearance Process (28-SEP-06, GAO-06-1070). 
                                                                 
The damage that unauthorized disclosure of classified information
can cause to national security necessitates the prompt and	 
careful consideration of who is granted a security clearance.	 
However, long-standing delays and other problems with DOD's	 
clearance program led GAO to designate it a high-risk area in	 
January 2005. DOD transferred its investigations functions to the
Office of Personnel Management (OPM) in February 2005. The Office
of Management and Budget's (OMB) Deputy Director for Management  
is coordinating governmentwide efforts to improve the clearance  
process. Congress asked GAO to examine the clearance process for 
industry personnel. This report addresses the timeliness of the  
process and completeness of documentation used to determine the  
eligibility of industry personnel for top secret clearances. To  
assess timeliness, GAO examined 2,259 cases of personnel granted 
top secret eligibility in January and February 2006. For the	 
completeness review, GAO compared documentation in 50 randomly	 
sampled initial clearances against federal standards.		 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-1070					        
    ACCNO:   A61644						        
  TITLE:     DOD Personnel Clearances: Additional OMB Actions Are     
Needed to Improve the Security Clearance Process		 
     DATE:   09/28/2006 
  SUBJECT:   Classified defense information			 
	     Classified information				 
	     Eligibility determinations 			 
	     Employees						 
	     Policy evaluation					 
	     Regulatory agencies				 
	     Security clearances				 
	     Government delays					 
	     Timeliness 					 

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO Product.                                                 **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
******************************************************************
GAO-06-1070

     

     * Results in Brief
     * Background
     * Determining Top Secret Clearances for Industry Personnel Ave
          * Delays in the Application-Submission and Investigation Phase
               * Lengthy Application-Submission Phase Lacks Transparency
               * Investigative Phase Took Longer Than the Goal Specified
               * DISCO Adjudications May Have Achieved the IRTPA Timeliness R
               * Delays in Clearance Process Cost Money and Threaten National
          * OPM's Timeliness Reporting Does Not Convey Full Magnitude of
     * OPM Delivered Incomplete Investigative Reports and DISCO Adj
          * Almost All of the Sampled Investigative Reports Were Incompl
          * DISCO Adjudicators Granted Top Secret Clearance Eligibility
          * Delivery and Use of Incomplete Investigations Increase Risks
     * Conclusions
     * Recommendations for Executive Action
     * Agency Comments
          * Office of Management and Budget
          * Department of Defense
          * Office of Personnel Management
     * Scope
     * Methodology
     * GAO Contact
     * Acknowledgments
     * GAO's Mission
     * Obtaining Copies of GAO Reports and Testimony
          * Order by Mail or Phone
     * To Report Fraud, Waste, and Abuse in Federal Programs
     * Congressional Relations
     * Public Affairs

Report to Congressional Requesters

United States Government Accountability Office

GAO

September 2006

DOD PERSONNEL CLEARANCES

Additional OMB Actions Are Needed to Improve the Security Clearance
Process

GAO-06-1070

Contents

Letter 1

Results in Brief 6
Background 9
Determining Top Secret Clearances for Industry Personnel Averaged More
than One Year and Government Statistics Did Not Portray All Delays 14
OPM Delivered Incomplete Investigative Reports and DISCO Adjudicated Cases
Did Not Document All Clearance-determination Considerations 25
Conclusions 37
Recommendations for Executive Action 38
Agency Comments 39
Appendix I: Scope and Methodology 45
Appendix II: Criteria for Determining Clearance Eligibility 50
Appendix III: Comments from the Office of Management and Budget 52
Appendix IV: Comments from the Department of Defense 54
Appendix V: Comments from the Office of Personnel Management 55
Appendix VI: Contact and Staff Acknowledgments 58
Related GAO Products 59

Tables

Table 1: Information Gathered in Conducting an Investigation to Determine
Eligibility for a Security Clearance 13
Table 2: Time Required to Grant Eligibility for a Top Secret Clearance to
Industry Personnel-Cases Adjudicated in January and February 2006 16
Table 3: Statistics on the Timeliness of Initial Investigations that OPM
Provided in Its Testimony Statement to Congress on May 17, 2006 23
Table 4: List of Organizations Contacted to Obtain Information Related to
the Timeliness and Completeness of Investigations and Adjudications 47

Figures

Figure 1: Six Phases in the Personnel Security Clearance Process 11
Figure 2: Number of OPM-prepared Investigative Reports Missing at Least
One Piece of Documentation for 12 of the 14 Types of Information-Cases
Adjudicated in January and February 2006 27
Figure 3: Number of Deficient Areas in Each OPM-prepared Investigative
Report-Cases Adjudicated in January and February 2006 28
Figure 4: Number of OPM-prepared Investigative Reports with at Least One
Unresolved Issue by Investigative Area-Cases Adjudicated in January and
February 2006 30
Figure 5: Number of DISCO-prepared Adjudicative Reports that Did Not
Document Issues Specified in Adjudicative Guidelines in the Presence of
Adverse Information, Cases Adjudicated in January and February 2006 35

Abbreviations

DISCO Defense Industrial Security Clearance Office

DOD Department of Defense

DOHA Defense Office of Hearings and Appeals

e-QIP Electronic Questionnaires for Investigations Processing

IRTPA Intelligence Reform and Terrorism Prevention Act

JPAS Joint Personnel Adjudication System

OMB Office of Management and Budget

OPM Office of Personnel Management

OUSD(I) Office of the Under Secretary of Defense for Intelligence

PIPS Personnel Investigations Processing System

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
work may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this material
separately.

United States Government Accountability Office

Washington, DC 20548

September 28, 2006

Congressional Requesters

The critical nature of the information that the Department of Defense
(DOD) and other federal agencies maintain and the damage to national
security that can result if it is not adequately safeguarded necessitate
scrupulous decision making when granting security clearances. With
clearances, personnel can gain access to classified information which
could cause damage to U.S. national defense or foreign relations through
unauthorized disclosure. In our 1999 report, we noted that these serious
negative consequences have included intelligence personnel being killed,
critical information being compromised, and U.S. military forces being put
at risk.

DOD's Office of the Under Secretary of Defense for Intelligence [OUSD(I)]
has overall responsibility for DOD clearances, and its responsibilities
extend beyond DOD. Specifically, that office's responsibilities include
obtaining background investigations and using that information to
determine eligibility for a clearance for industry personnel in 23 other
federal agencies,1 as well as the clearances of staff in the federal
government's legislative branch. As of May 2006, industry personnel held
about 34 percent of the approximately 2.5 million DOD-maintained personnel
security clearances. Individuals working for private industry are playing
an increasingly larger role in national security work conducted by DOD and
other federal agencies as a result of an increased awareness of threats to
our national security stemming from the terrorist attacks on the United
States on September 11, 2001, and increased efforts over the past decade
to privatize federal jobs.

1 DOD, National Industrial Security Program: Operating Manual, DOD
5220.22-M (Feb. 28, 2006) notes the Secretary of Defense has entered into
agreements with 23 departments and agencies listed below for the purpose
of rendering industrial security services. This delegation of authority is
contained in an exchange of letters between the Secretary of Defense and
the civilian official with authority to delegate authority for the
following agencies: (1) National Aeronautics and Space Administration, (2)
Department of Commerce, (3) General Services Administration, (4)
Department of State, (5) Small Business Administration, (6) National
Science Foundation, (7) Department of the Treasury, (8) Department of
Transportation, (9) Department of the Interior, (10) Department of
Agriculture, (11) Department of Labor, (12) Environmental Protection
Agency, (13) Department of Justice, (14) Federal Reserve System, (15)
Government Accountability Office, (16) U.S. Trade Representative, (17)
U.S. International Trade Commission, (18) U.S. Agency for International
Development, (19) Nuclear Regulatory Commission, (20) Department of
Education, (21) Department of Health and Human Services, (22) Department
of Homeland Security, and (23) Federal Communications Commission.

In February 2005, DOD transferred its personnel security investigations
functions and about 1,800 investigative positions to the Office of
Personnel Management (OPM).2 Now, DOD obtains nearly all of its clearance
investigations from OPM,3 which is currently responsible for 90 percent of
the personnel security clearance investigations in the federal
government.4 DOD retained responsibility for adjudication (determination
of eligibility for a clearance) of military personnel, DOD civilians, and
industry personnel. Two offices are responsible for adjudicating cases
involving industry personnel. The Defense Industrial Security Clearance
Office (DISCO) within OUSD(I) adjudicates cases that contain only
favorable information or minor issues regarding security concerns (e.g.,
some overseas travel by the individual), and the Defense Office of
Hearings and Appeals (DOHA) within the Defense Legal Agency adjudicates
cases that contain major security issues (e.g., an individual's
unexplained affluence or criminal history) which could result in the
denial of clearance eligibility.

Long-standing delays in completing hundreds of thousands of clearance
requests for servicemembers, federal employees, and industry personnel as
well as numerous impediments that hindered DOD's ability to accurately
estimate and eliminate its clearance backlog led us to declare DOD's
personnel security clearance program a high-risk area in January 2005.5
The 25 areas on our high-risk list at that time received their designation
because they are major programs and operations that need urgent attention
and transformation in order to ensure that our national government
functions in the most economical, efficient, and effective manner
possible.

2 According to OMB officials, 1,800 authorized spaces were transferred
from DOD to OPM. Of which, 1,578 former DOD employees were transferred. Of
these, 1,301 were investigators.

3 Currently, three DOD agencies (National Security Agency, Defense
Intelligence Agency, and the National Reconnaissance Office) have waivers
from DOD that allow them to contract for their own personnel security
clearance investigations.

4 In GAO, DOD Personnel Clearances: Some Progress Has Been Made but
Hurdles Remain to Overcome the Challenges That Led to GAO's High-Risk
Designation, GAO-05-842T (Washington, D.C.: June 28, 2005), we listed, as
identified by the then Deputy Associate Director of OPM's Center for
Federal Investigative Services, the departments/agencies having statutory
or delegated authority to conduct background investigations. Those
departments/agencies are the Central Intelligence Agency; Department of
State; Department of the Treasury; Internal Revenue Service; Bureau of
Engraving and Printing; Federal Bureau of Investigation; National Security
Agency; U.S. Agency for International Development; Department of Homeland
Security; Bureau of Customs and Border Protection; U.S. Secret Service;
Small Business Administration; Broadcasting Board of Governors; Department
of Justice-Bureau of Alcohol, Tobacco, Firearms, and Explosives; U.S.
Postal Service; Tennessee Valley Authority; National Reconnaissance
Office; and Peace Corps. Even though these agencies have authority to
conduct their own investigations, some of them request that OPM conduct
all or part of their investigations.

Other recent significant events affecting DOD's clearance program have
been the passage of the Intelligence Reform and Terrorism Prevention Act
of 20046 (IRTPA) and the issuance of the June 2005 Executive Order No.
13381, Strengthening Processes Relating to Determining Eligibility for
Access to Classified National Security Information. IRTPA included
milestones for reducing the time to complete clearances, general
specifications for a database on security clearances, and requirements for
reciprocity of clearances (the acceptance of a clearance and access
granted by another department, agency, or military service). Not later
than December 17, 2006, IRTPA requires agencies to make a determination of
eligibility for a clearance on at least 80 percent of all applications
within an average of 120 days after the date of receipt of the
application, with a maximum of 90 days allotted for the investigation and
a maximum of 30 days allotted for the adjudication.7

Among other things, Executive Order 133818 stated that the Office of
Management and Budget (OMB) was to ensure the effective implementation of
policy related to appropriately uniform, centralized, efficient,
effective, timely, and reciprocal agency functions relating to determining
eligibility for access to classified national security information. In
June 2005, OMB's Deputy Director of Management was designated as the OMB
official responsible for improving the process by which the government
determines eligibility for access to classified national security
information. Since then, the Deputy Director has testified before Congress
multiple times about efforts to improve the security clearance process and
has taken positive actions, such as establishing an interagency working
group to improve the reciprocal acceptance of clearances issued by other
agencies and taking a lead role in preparing a strategic plan to improve
personnel security clearance processes governmentwide. The plan included
quarterly timeliness goals for initial investigations of clearances for
the 13 months between the issuance of the plan and the date on which
agencies are to begin comparisons against the IRTPA timeliness
requirements. For January through March 2006 (which includes the period
covered by the data used in our analyses), the plan specified goals of 180
days to complete investigations for initial top secret clearances and 130
days to complete investigations for initial secret and confidential
clearances. Goals were not provided for completing investigations for
clearance updates, and the plan indicated that adjudications would be
compared against the future IRTPA requirement of 80 percent completed
within 30 days of receipt.

5 GAO, High-Risk Series: An Update, GAO-05-207 (Washington, D.C.: January
2005).

6 Pub. L. No. 108-458.

7 50 U.S.C. S: 435b(g), Reduction in Length of Personnel Security
Clearance Process (Dec. 17, 2004).

8 The White House, Executive Order 13381, Strengthening Processes Relating
to Determining Eligibility for Access to Classified National Security
Information (June 27, 2005). On June 29, 2006, the executive order was
extended until July 1, 2007.

Problems in the clearance program can negatively affect national security.
For example, delays reviewing security clearances for personnel who are
already doing classified work can lead to a heightened risk of disclosure
of classified information. In contrast, delays in providing initial
security clearances for previously noncleared personnel can result in
other negative consequences, such as additional costs and delays in
completing national security-related contracts, lost-opportunity costs,
and problems retaining the best qualified personnel. Moreover, our reports
in 1999 and 2001 noted that when clearance investigations or adjudications
are inadequately or inconsistently documented, DOD was unable to
demonstrate that it fully considered all significant adverse conditions
that might call into question an individual's ability to adequately
safeguard classified information.9 Similar concerns about the broader
issue of quality were identified more recently in the government plan to
improve the clearance process. More specifically, the November 2005
government wide plan to improve the security clearance process noted that
"a lack of reciprocity [the acceptance of a clearance and access granted
by another department, agency or military service] often arises due to
reluctance of the gaining activity to inherit accountability for what may
be an unacceptable risk due to poor quality investigations and/or
adjudications."10

9 GAO, DOD Personnel: More Consistency Needed in Determining Eligibility
for Top Secret Security Clearances, GAO-01-465 (Washington, D.C.: Apr. 18,
2001); and GAO, DOD Personnel: Inadequate Personnel Security
Investigations Pose National Security Risks, GAO/NSIAD-00-12 (Washington,
D.C.: Oct. 27, 1999).

You expressed concern about the negative consequences of untimely,
inadequate, or inconsistent investigations and adjudications. This report
addresses two questions: (1) How timely are the processes used to
determine whether industry personnel are eligible for a top secret
clearance? and (2) How complete is the documentation of the processes used
to determine whether industry personnel are eligible for a top secret
clearance? This report supplements the information we provided to you
recently in congressional hearings that examined various aspects of DOD's
personnel security clearance program (see the list of Related GAO Products
at the end of this report).

The scope of our work emphasized the analysis of information on top secret
clearances awarded to industry personnel, but we also gathered additional
information on other levels of clearances and clearance requests from
other types of personnel in order to provide a broader context for
understanding our primary findings. For both key questions, we reviewed
laws, executive orders, policies, and reports related to the timeliness
and completeness of security clearance investigations and adjudications
for industry personnel as well as servicemembers and civilian governmental
employees. Those sources provided the criteria used for assessing
timeliness and documentation completeness, as well as identified causes
for and effects from delayed clearances and incomplete investigative and
adjudicative reports. Additional insights about causes of and effects from
delayed clearances and incomplete investigative and adjudicative reports
were obtained from interviews with and documentary evidence from personnel
associated with a variety of governmental offices: OUSD(I), DISCO, DOHA,
other DOD adjudication facilities that make clearance determinations for
servicemembers and DOD civilians; DOD's Personnel Security Research
Center; the Defense Security Service's Training Academy that offers
adjudicator training; and OPM. Nongovernmental organizations supplying
information on conditions, causes, and effects included officials
representing two of OPM's investigations contractors and technology
associations whose member organizations require clearances for their
industry personnel employees. For the timeliness question, our analyses of
conditions included a review of computerized data abstracted from DOD's
Joint Personnel Adjudication System (JPAS) and statistical reports on
timeliness that OPM produced for DOD. The abstract was for the population
of 1,685 industry personnel granted an initial top secret clearance and
574 industry personnel granted a top secret clearance update by DISCO
during January and February 2006. The clearance investigations for those
2,259 industry personnel were started at various times prior to the
adjudications. While we found problems with the accuracy of some of the
JPAS data, we determined they were sufficiently reliable for the purposes
of this report. DOD and OPM also supplied timeliness statistics for other
periods, levels of clearances, types of personnel, and agencies to provide
us with a broader context to interpret the timeliness statistics that we
computed from the database abstract. We addressed the completeness
question with a multiple-step process. We (1) randomly selected 50 cases
from the previously described population of 1,685 initially cleared
industry personnel, (2) obtained paper files of the 50 investigative and
adjudicative reports, (3) created a data collection instrument using
federal investigative standards and adjudicative guidelines to standardize
our data gathering, (4) sought experts' comments to refine our instrument
and process, (5) coded data from the paper files, (6) had a second team
member independently verify the information that another team member had
coded, and (7) computed statistics to indicate the numbers of
investigative and adjudicative reports with various types of missing
documentation. In addition, two team members attended OPM's basic special
agent training course to obtain an understanding of the investigative
requirements as promulgated by OPM, and two other members of our team took
about 40 hours of online adjudications training. We performed our work
from September 2005 through August 2006 in accordance with generally
accepted government auditing standards. Additional information on our
scope and methodology is presented in appendix I.

10 OMB, Plan for Improving the Personnel Security Clearance Process
(November 2005).

                                Results in Brief

Our independent analysis of timeliness data showed that industry personnel
contracted to work for the federal government waited more than one year on
average to receive top secret clearances, longer than OPM-produced
statistics would suggest. Our analysis of 2,259 cases for industry
personnel who were granted top secret clearance eligibility in January and
February 2006 had an average of 446 days for an initial clearance and 545
days for a clearance update. While OMB has issued a goal that the
application-submission phase of the clearance process will take no longer
than 14 days by December 17, 2006, this phase took an average of 111 days.
OPM's current procedures for measuring application-submission timeliness
do not fully capture all of the time in the application process that
starts when the application form is submitted by the facility security
officer to the federal government. Inaccurate data that the employee
provided in the application, multiple reviews of the application, and
manual entry of some application forms are some of the causes for the
extended application-submission phase. In addition, our analyses showed
that OPM took an average of 286 days to complete the initial
investigations for top secret clearances, well in excess of the 180-day
goal (no goal is given for clearance update investigations) specified in
the governmentwide plan for improving the clearance process. Factors
contributing to the slowness of completing the investigation phase include
an inexperienced investigative workforce that has not reached its full
performance level; and problems accessing national, state, and local
records. Finally, the average time required for the adjudications for all
industry personnel top secret cases in our population was 39 days,
compared to IRTPA's future requirement that 80 percent of all cases be
completed in 30 days. DOD adjudicators have, however, noted that current
procedures to measure adjudication timeliness include 2-3 weeks for OPM to
print and ship its investigative reports, rather than delivering them
electronically. Regardless of when in the process the delays occur, the
outcome is the same-the government may incur additional costs from new
industry employees being unable to begin work promptly and increased risks
to national security because previously cleared industry employees'
backgrounds are not completed promptly to see if they still should be
eligible to hold a clearance. Our analysis of OPM-produced statistics
suggests that current methods do not fully capture and portray the time
required to obtain a clearance. For example, we have already noted that
the methods do not measure the total time for the application-submission
phase. Also, OPM-provided statistics may underrepresent the average number
of days required in the process by treating some incomplete investigations
(termed "closed pending cases") as being fully complete and not counting
all of the time when other incomplete investigations are returned for
additional investigative work. OPM's issuance of closed pending
investigations causes ambiguity in defining and accurately estimating the
backlog of overdue investigations. Statistics that underrepresent the time
that it takes for investigations to be completed prevent congressional
oversight committees from having a fuller understanding of the
government's efforts to decrease delays in the clearance process and
determining if legislative actions are necessary.

OPM provided incomplete investigative reports to DISCO adjudicators, and
DISCO adjudicators used these reports to grant clearance eligibility for
industry personnel. In some cases, these investigative reports contained
unresolved issues such as unexplained affluence and potential foreign
influence. In our review of 50 initial investigations for top secret
clearances randomly sampled from the population used in our timeliness
analyses, we found that almost all (47 of 50) of the sampled investigative
reports were missing documentation required by federal investigative
standards. At least half of the 50 reports that we examined did not
contain the required documentation in three investigative areas:
residence, employment, and education. Moreover, the federal standards
indicate that investigations may be expanded as necessary to resolve
issues. We found at least one unresolved issue in 27 investigative
reports. For example, one investigative report did not contain additional
information even though another portion of the report briefly identified
issues such as possible multiple extramarital affairs, and financial
delinquency on a loan worth several thousand dollars. Officials from OPM's
Quality Management unit reviewed 8 of our sampled cases and confirmed that
information we found to be missing should have been included in the final
investigative reports. OPM officials suggested that the need to rapidly
increase the size of the investigative workforce and prior quality control
procedures, that have since been replaced, were some of the causes for the
delivery of incomplete investigative reports to DISCO. In our review of
the completeness of documentation in adjudicative reports, we found that
the adjudicators had not documented the missing investigative information
and did not record other information related to issues that were present
in the investigative reports. DISCO adjudicators granted top secret
clearance eligibility for 27 industry personnel whose investigative
reports contained unresolved issues without requesting additional
information or documenting in the adjudicative report that the information
was missing. DISCO officials reviewed our findings for 8 cases and
indicated that documentation was missing for some of the cases. In
explaining the reasons why adjudicators might make eligibility
determinations without a full investigative report, they noted that
adjudicators weigh a variety of factors in making their risk-based
determinations. We believe that another factor is the limited attention
devoted to the assessment of completeness and other aspects of quality.
The limited assessment of quality was one of the concerns we raised in our
November 2005 assessment of the governmentwide plan for improving the
clearance process, but the plan has not been revised to address the
shortcomings that we identified. The use of incomplete investigations and
adjudications in the granting of top secret clearance eligibility
increases the risk of unauthorized disclosure of classified information.
Also, it could negatively affect efforts to promote reciprocity that are
being developed by an interagency working group headed by OMB's Deputy
Director of Management.

In order to improve the timeliness and completeness of OPM investigations
and DOD adjudications for top secret security clearance for industry
personnel, we are making a number of recommendations to OMB's Deputy
Director for Management. To improve timeliness, we recommend that OPM and
DOD fully measure and report all of the time that transpires between when
the facility security officer submits the application to when the
clearance-eligibility determination has been provided to the customer;
identify and implement information technology solutions; and update and
widely distribute the government plan for improving the security clearance
process. To improve the completeness, we recommend that OMB require OPM
and DOD to submit procedures for eliminating the deficiencies that we
identified in this review and develop metrics for monitoring the
effectiveness of the new procedures; and in an effort to improve
reciprocity, issue guidance that clarifies when, if ever, adjudicators may
use incomplete investigative reports as the basis for granting clearance
eligibility. In his comments on a draft of this report, OMB's Deputy
Director for Management did not take exception to any of our
recommendations.

                                   Background

As with servicemembers and federal workers, industry personnel must obtain
a security clearance to gain access to classified information, which is
categorized into three levels: top secret, secret, and confidential. The
level of classification denotes the degree of protection required for
information and the amount of damage that unauthorized disclosure could
reasonably be expected to cause to national defense or foreign relations.
For top secret information, the expected damage that unauthorized
disclosure could reasonably be expected to cause is "exceptionally grave
damage"; for secret information, it is "serious damage"; and for
confidential information, it is "damage."11

To ensure the trustworthiness, reliability, and character of personnel in
positions with access to classified information, DOD relies on a
multiphased personnel security clearance process.12 Figure 1 shows six
phases that could be involved in determining whether to grant an actual or
a potential job incumbent a clearance. The three phases shown in gray are
those that are most transparent to individuals requesting an initial
clearance. Such individuals may not have been aware that they

11 5 C.F.R. S:1312.4, Classification of National Security Information
(2006).

           o  are allowed to apply for a clearance only if a contractor
           determines that access is essential in the performance of tasks or
           services related to the fulfillment of a classified contract
           (Phase 1),
           o  have certain appeal rights if their clearance request is denied
           or their clearance is subsequently revoked (Phase 5), and
           o  may need to renew their clearance in the future if they occupy
           their position for an extended period (Phase 6).

12 DOD Directive 5200.2, DOD Personnel Security Program (Apr. 9, 1999),
establishes policy and procedures for granting DOD military, civilian, and
industry personnel access to classified information. Additionally, DOD
Regulation 5200.2-R, DOD Personnel Security Program (January 1987),
establishes DOD personnel security policies and procedures; sets forth
standards, criteria, and guidelines upon which personnel security
determinations shall be based; prescribes the types and scopes of
personnel security investigations required; details the evaluation and
adverse action procedures by which personnel security determinations shall
be made; and assigns overall program management responsibilities. The
policies and procedures for granting industry personnel security
clearances and adjudicative procedural guidance for appealing cases if an
unfavorable clearance decision is reached also are contained in DOD
Directive 5220.6, Defense Industrial Personnel Security Clearance Review
Program (Apr. 20, 1999).

Figure 1: Six Phases in the Personnel Security Clearance Process

In the application-submission phase, if a position requires a clearance
(as has been determined in Phase 1), then the facility security officer
must request an investigation of the individual. The request could be the
result of needing to fill a new position for a recent contract, replacing
an employee in an existing position, renewing the clearance of an
individual who is due for clearance updating (Phase 6), or processing a
request for a future employee in advance of the hiring date. Once the
requirement for a security clearance is established, the industry employee
completes a personnel security questionnaire using OPM's Electronic
Questionnaires for Investigations Processing (e-QIP) system, or a paper
copy of the standard form 86. After a review, the facility security
officer submits the questionnaire and other information such as
fingerprints to OPM.

In the investigation stage, OPM or one of its contractors conducts the
actual investigation of the industry employee by using standards that were
established governmentwide in 1997.13 As table 1 shows, the type of
information gathered in an investigation depends on the level of clearance
needed and whether an investigation for an initial clearance or a
reinvestigation for a clearance update is being conducted. For either an
initial investigation or a reinvestigation for a confidential or secret
clearance, investigators gather much of the information electronically.
For a top secret clearance, investigators gather additional information
that requires much more time-consuming efforts, such as traveling,
obtaining police and court records, and arranging and conducting
interviews. In August 2006, OPM estimated that approximately 60 total
staff hours are needed for each investigation for an initial top secret
clearance and 6 total staff hours are needed for the investigation to
support a secret or confidential clearance. After the investigation is
complete, OPM forwards a paper copy of the investigative report to DISCO
for adjudication.

13 The White House, "Implementation of Executive Order 12968," Memorandum
(Washington, D.C.: Mar. 24, 1997). This memorandum includes Investigative
Standards for Background Investigations for Access to Classified
Information and Adjudicative Guidelines for Determining Eligibility for
Access to Classified Information. It approves the adjudicative guidelines,
temporary eligibility standards, and investigative standards required by
Executive Order No. 12968, Access to Classified Information (Aug. 4,
1995).

Table 1: Information Gathered in Conducting an Investigation to Determine
Eligibility for a Security Clearance

                              Type of security 
                               clearance and   
                               investigation   
                              Confidential or                 
                                   secret        Top secret   
                                  Initial                                     
Type of information        investigation or     Initial    
gathered                   reinvestigation   investigation Reinvestigation
1. Personnel security             X                X              X        
questionnaire: The                                         
subject's self-reported                                    
answers on a paper SF-86                                   
form or an electronic form                                 
2. National agency check:         X                X              X        
Data from Federal Bureau                                   
of Investigation, military                                 
records, and other                                         
agencies as required                                       
3. Credit check: Data from        X                X              X        
credit bureaus where the                                   
subject                                                    
lived/worked/attended                                      
school for at least 6                                      
months                                                     
4. Local agency checks:           X                X              X        
Data from law enforcement                                  
agencies where the subject                                 
lived/worked/attended                                      
school during the past 10                                  
years or-in the case of                                    
reinvestigations-since the                                 
last security clearance                                    
investigation                                              
5. Date and place of              X                X       
birth: Corroboration of                                    
information supplied on                                    
the personnel security                                     
questionnaire                                              
6. Citizenship: For                                X       
individuals born outside                                   
of the United States,                                      
verification of U.S.                                       
citizenship directly from                                  
the appropriate                                            
registration authority                                     
7. Education: Verification                         X              X        
of most recent or                                          
significant claimed                                        
attendance, degree, or                                     
diploma                                                    
8. Employment: Review of                           X              X        
employment records and                                     
interviews with workplace                                  
references, such as                                        
supervisors and coworkers                                  
9. References: Data from                           X              X        
interviews with                                            
subject-identified and                                     
investigator-developed                                     
leads                                                      
10. National agency check                          X              X        
for spouse or cohabitant:                                  
National agency check                                      
without fingerprint                                        
11. Former spouse: Data                            X              X        
from interview(s)                                          
conducted with spouse(s)                                   
divorced within the last                                   
10 years or since the last                                 
investigation or                                           
reinvestigation                                            
12. Neighborhoods:                                 X              X        
Interviews with neighbors                                  
and verification of                                        
residence through records                                  
check                                                      
13. Public records:                                X              X        
Verification of issues,                                    
such as bankruptcy,                                        
divorce, and criminal and                                  
civil court cases                                          
14. Subject interview:                             X              X        
Collection of relevant                                     
data, resolution of                                        
significant                                                
inconsistencies, or both                                   

Source: DOD and OPM.

In the adjudication stage, DISCO or some other adjudication facility uses
the information from the investigative report to determine whether an
individual is eligible for a security clearance. For our May 2004 report,
an OUSD(I) official estimated that it took three times longer to
adjudicate a top secret clearance than it did to adjudicate a secret or
confidential clearance. If the report is determined to be a "clean" case-a
case that contains no or minimal potential security issues-the DISCO
adjudicators determine eligibility for a clearance. However, if the case
is determined to be an "issue" case-a case containing information that
might disqualify an individual for a clearance (e.g., serious foreign
connections or drug- or alcohol-related problems)-then DISCO forwards the
case to DOHA adjudicators for the clearance-eligibility decisions.
Regardless of which office renders the adjudication to approve, deny, or
revoke eligibility for a security clearance, DISCO issues the
clearance-eligibility decision and forwards the determination to the
industrial contractor. All adjudications are based on 13 federal
adjudicative guidelines established governmentwide in 1997 and implemented
by DOD in 1998 (see app. II ). The President approved an update of the
adjudication guidelines on December 29, 2005. According to OMB, DOD should
be using these updated guidelines.

Determining Top Secret Clearances for Industry Personnel Averaged More than One
           Year and Government Statistics Did Not Portray All Delays

Industry personnel contracted to work for the federal government waited
more than one year on average to receive top secret security clearances,
and government statistics did not portray the full length of time it takes
many applicants to obtain a clearance. Industry personnel in the
population from which our sample was randomly selected waited on average
over one year for initial clearances and almost a year and a half for
clearance updates. The phase of the process between the time an applicant
submits his or her application and the time the investigation actually
begins averaged over 3 months, and government statistics did not fully
account for the time required to complete this phase. In addition, the
investigative phase for industry personnel was not timely, and government
statistics did not account for the full extent of the delay. Delays in the
clearance process may cost money and pose threats to national security.

Delays in the Application-Submission and Investigation Phases Are Caused by Many
Factors

Industry personnel granted eligibility for top secret clearances from
DISCO in January and February 2006 waited an average of 446 days for their
initial clearance or 545 days for their clearance update. DISCO may,
however, have issued an interim clearance to some of these industry
personnel, which might have allowed them to begin classified work for many
contracts.14 Beginning in December 2006, IRTPA will require that 80
percent of all clearances-regardless of clearance level-be completed in an
average of 120 days.15 The government plan for improving the personnel
security clearance process provides quarterly goals for various types of
initial clearances. Since the completion of initial clearances is given
priority over completion of clearance updates, much of our discussion in
this section focuses on the timeliness of initial clearances.

  Lengthy Application-Submission Phase Lacks Transparency

The application-submission phase of the clearance process took on average
111 days for the initial clearances that DISCO adjudicated in January and
February 2006 (see table 2). The starting point for our measurement of
this phase was the date when the application was submitted by the facility
security officer.16 Our end point for this phase was the date that OPM
scheduled the investigation into its Personnel Investigations Processing
System (PIPS). We used this starting date because the government can begin
to incur an economic cost if an industry employee cannot begin work on a
classified contract because of delays in obtaining a security clearance
and this end date because OPM currently uses this date as its start point
for the next phase in the clearance process. The governmentwide plan on
improving the clearance process noted that "investigation submission"
(i.e., application-submission) be completed in 14 calendar days or less.
Therefore, the 111 days taken for the application-submission phase took
nearly 100 more days on average than allocated.

14 DISCO reported that it granted eligibility for 10,724 of 11,397 (94
percent) interim top secret clearance determinations and declined interim
clearances for 673, during the period from October 1, 2005, through July
31, 2006. To grant an interim clearance, DISCO stated that it reviews the
security clearance application, performs record checks using DOD and OPM
security databases, verifies that there is no existing clearance
eligibility or investigation that would meet the requirements of the
application, and determines that the facts and circumstances indicate that
access to classified information is consistent with the national security
interests of the United States.

15 In our analyses, we are not identifying the percentage of top secret
clearances which were completed within an average of 120 days. Because
investigations for top secret clearances require more time for data
collection than do the investigations for secret or confidential
clearances, the comparison of the overall timeliness or the investigation
time for top secret clearances only could result in misleading conclusions
about the government's ability to meet the IRTPA requirement for all
levels of clearances combined.

16 JPAS included a field that recorded the date the personal security
questionnaire was sent to DISCO by the facility security officers. These
data were used as the starting point for our analyses.

Table 2: Time Required to Grant Eligibility for a Top Secret Clearance to
Industry Personnel-Cases Adjudicated in January and February 2006

Total                      Phases of security clearance process a
clearance    2. Application                                        
process          submission  3. Investigation   4. Adjudication    
Clearance  Average days 111  Average days 286 Average days 39 36 38
Average              81 103           419 320 
type days                                     
b Initial                                     
446                                           
Update                                        
545 All                                       
471                                           
Example      o  Subject        o  If             o  OPM prints a      o  DISCO      
tasks and    signs and         application is    paper copy of the    adjudicator   
decisions    dates the         not submitted     investigative        reviews the   
required     application.      via e-QIP, OPM    report.              information   
in each      o  Facility       key-enters        o  OPM ships the     in the        
phase.       security          information       paper copies to      investigative 
             officer checks    for the           adjudication         report.       
             application       application       facilities if        o  DISCO      
             materials for     into its          agencies choose      adjudicator   
             completeness      investigative     or cannot get it     determines if 
             and accuracy,     database.         electronically.17    industry      
             and forwards      o  OPM                                 employee is   
             them to DISCO     schedules the                          eligible for  
             after any         investigation,                         a clearancec  
             applicable        assigning the                       
             changes.          investigation                       
             o  DISCO          to its federal                      
             adjudicator       investigative                       
             reviews           workforce or                        
             materials for     one of its                          
             completeness      investigations                      
             and other         contractors.                        
             concerns, and     o                                   
             returns           Investigators                       
             deficient         gather the                          
             materials to      types of                            
             the facility      information                         
             security          identified                          
             officer for       earlier in                          
             further work.     table 1 to                          
             o  If the         produce an                          
             application       investigative                       
             materials are     report.                             
             approved,         o  OPM's PIPS                       
             DISCO             database                            
             adjudicators      obtains a                           
             determine         variety of                          
             whether the       electronic                          
             applicant is      information                         
             eligible for      that is                             
             an interim        available via                       
             clearance.        government                          
             o  DISCO then     databases.                          
             forwards the      o  Once the                         
             completed         investigative                       
             application to    work has been                       
             OPM to begin      completed, OPM                      
             the               checks the                          
             investigation.    investigative                       
             o  OPM reviews    report for                          
             the               completeness                        
             application       before sending                      
             for               the report to                       
             completeness      an                                  
             and other         adjudication                        
             concerns and      facility.                           
             returns                                               
             deficient                                             
             materials to                                          
             DISCO for                                             
             further work.                                         

Source: GAO analysis of OPM and DOD information.

aThe phases referred to here are based on figure 1 provided earlier.

bThe average days for the phases do not sum to the average days for the
total clearance process because the number of applicable cases varies for
each calculation. See app. I for details.

cAdditional time may be needed in this phase if DISCO adjudicators
identify major security issues in the investigative report. Such cases may
be submitted to DOHA for the clearance eligibility determination.

17 According to OPM, the requesting agency has the option to request that
the investigation be delivered through PIPS, eliminating the mail time,
for all completed investigations that do not contain hard-copy third-party
information.

Several factors contribute to the amount of time we observed in the
application-submission phase, including rejecting applications multiple
times, multiple completeness reviews, and manually entering data from
paper applications. For example, an April 2006 DOD Office of Inspector
General report cited instances where OPM rejected applications multiple
times due to inaccurate information. The security managers interviewed for
that report said it appeared that OPM did not review the entire documents
for all errors before returning them. Security managers at two DOD
locations noted that in some cases OPM had rejected the same application
submission three or four times for inaccurate information. The cited
inaccuracies included outdated references, telephone numbers, and
signatures, as well as incorrect zip codes. Another source of delay is the
multiple levels of review that are performed before the application is
accepted. Reviews of the clearance application might include the corporate
facility security officer, DISCO adjudicators, and OPM staff. A third
source of the delay in the application-submission phase is the time that
it takes OPM to key-enter data from paper applications. For April 2006,
OPM's Associate Director in charge of the investigations unit stated that
applications submitted on paper took an average of 14 days longer than
submissions through OPM's electronic Questionnaires for Investigations
Processing (e-QIP). She also noted additional information on e-QIP that
could portend future timeliness improvements governmentwide: in May 2006,
over 221,000 investigations had been requested through e-QIP by 50
agencies (up from 17,000 submissions by 27 agencies in June 2005), and a
goal to reduce the rejection rate for e-QIP applications from the current
9 percent to 5 percent. The gray portion of table 2's
application-submission phase identifies some tasks that are not currently
included in the investigation phase of the clearance process but which
could be included in the investigation phase, depending on the
interpretation of what constitutes "receipt of the application for a
security clearance by an authorized investigative agency"-IRTPA's start
date for the investigations phase.

  Investigative Phase Took Longer Than the Goal Specified

Investigations for the initial top secret clearances of industry personnel
took an average of 286 days for DISCO cases adjudicated in January and
February 2006 (see table 2). During the same period, investigations for
top secret clearance updates took an average of 419 days, almost 1 1/2
times as long as the initial investigations. Compared to our findings, OPM
reported that the time required to complete initial investigations for top
secret clearances was much shorter when it analyzed governmentwide data
for April 2006. The newer data indicate that OPM completed the initial
investigations in 171 days. While some of that difference in investigation
times reported by GAO and OPM may be related to better productivity, a
later section of this report identifies other factors that could have
contributed to the difference. The shorter period of 171 days is less than
the 180 days provided as a goal in the governmentwide plan. But the
methods for computing the 171 days may not have included the total average
time required to complete an initial clearance.

Many factors impede the speed with which OPM can deliver investigative
reports to DISCO and other adjudication facilities. As we have previously
identified, DOD's inability to accurately project the number of requests
for security clearances is a major impediment to investigative workload
planning and clearance timeliness.18 As we noted in 2004 when both OPM and
DOD were struggling to improve investigation timeliness, backlogged
investigations contributed to delays because most new requests for
investigations remain largely dormant until earlier requests are
completed.19 The governmentwide plan for improving the personnel security
clearance process also asserted that while the total number of OPM federal
and contract investigators was sufficient to meet the timeliness
requirements of the IRTPA, many of the investigative staff are relatively
inexperienced and do not perform at a full-performance level. In May 2006,
we noted that OPM reported progress in developing an overseas presence to
investigate leads overseas, but acknowledged it will take time to fully
meet the full demand for overseas investigative coverage.20 In May 2006,
the Associate Director in charge of OPM's investigations unit indicated
that her unit continues to have difficulty obtaining national, state, and
local records from third-party providers. Similarly, representatives for
contractors and their associations are concerned that new investigative
requirements like those in Homeland Security Presidential Directive-12
could further slow responses to OPM's requests for information from
national, state, and local agencies.21 Finally, more requests for top
secret clearances could slow OPM's ability to meet the IRTPA timeliness
requirements, since investigations for that level of clearance are
estimated to take 10 times the number of staff hours as do investigations
for secret and confidential clearances.

18 OPM's 2006 quarterly reports showed that DOD exceeded its projected
workload for top secret cases during the first and second quarters of
fiscal year 2006 by 32 and 22 percent, respectively. The government plan
established a 5 percent limit on how far agencies could exceed their
workload projections.

19 GAO, DOD Personnel Clearances: Additional Steps Can Be Taken to Reduce
Backlogs and Delays in Determining Security Clearance Eligibility for
Industry Personnel, GAO-04-632 (Washington, D.C.: May 26, 2004).

20 GAO, DOD Personnel Clearances: New Concerns Slow Processing of
Clearances for Industry Personnel, GAO-06-748T (Washington, D.C.: May 17,
2006).

21 The White House, Homeland Security Presidential Directive/Hspd-12,
Policy for a Common Identification Standard for Federal Employees and
Contractors (Aug. 27, 2004).

  DISCO Adjudications May Have Achieved the IRTPA Timeliness Requirement

DISCO adjudicators took an average of 39 days to grant initial clearance
eligibility to the industry personnel whose cases were decided in January
and February 2006 (see table 2).22 The measurement of this phase for our
analysis used the same start and stop dates that OPM uses in its reports,
starting on the date that OPM closed the report and continuing through the
date that DISCO adjudicators decided clearance eligibility. In December
2006, IRTPA will require that at least 80 percent of the adjudications be
completed within 30 days. As of June 2006, DISCO reported that it had
adjudicated 82 percent of its initial top secret clearances within 30
days. In its report, DISCO excluded the time required to print and
transfer investigative reports from OPM to DISCO.

Two data reliability concerns make it difficult to interpret statistics
for the adjudication phase of the clearance process. First, the activities
in the gray section in the adjudication phase of table 2 show that the
government's current procedures for measuring the time required for the
adjudication phase include tasks that occur before adjudicators actually
receive the investigative reports from OPM. Although the information that
we analyzed could not be used to determine how much time had elapsed
before DISCO received the investigative reports, DOD adjudication
officials recently estimated that these printing and transfer tasks had
taken 2 to 3 weeks. OUSD(I) and adjudication officials said that inclusion
of this time in the adjudication phase holds adjudicators accountable for
time that is not currently in their control. They acknowledge that OPM has
offered faster electronic delivery of the investigative reports, but they
countered that they would need to then print the reports since the files
are not offered in an electronic format that would allow the adjudicators
to easily use the electronic information. The second data reliability
problem is DOD's nonreporting of final dates of adjudication decisions to
OPM. While we had the dates that the clearance eligibility was determined
for our data, OPM officials have noted that DOD departmentwide reported
about 10 percent of its adjudication decisions back to OPM for August
2006. Although OPM reports this information as specified by the government
plan for improving the security clearance process, OPM officials
acknowledged that they have not enforced the need to report this
information. When asked about this issue, DOD officials indicated that OPM
would not accept a download of adjudication dates from JPAS that DOD had
offered to provide on compact discs. Since DOD represents about 80 percent
of the security clearances adjudicated by the federal government, not
including these data could make it appear as if adjudication timeliness is
different than it actually is.

22 This time includes the amount of time taken to transfer investigative
reports from OPM to DISCO, since DISCO was not tracking the transfer time
during the period that GAO selected its sample.

  Delays in Clearance Process Cost Money and Threaten National Security

In 2004, we outlined unnecessary costs and threats to national security
that result from delays in determining clearance eligibility.23 Those same
negative consequences apply today. Delays in completing initial security
clearances may have an economic impact on the costs of performing
classified work within or for the U.S. government. In a 1981 report, we
estimated that DOD's investigative backlog of overdue clearances cost
nearly $1 billion per year in lost productivity.24 More than a decade
later, a Joint Security Commission report noted that the costs directly
attributable to investigative delays in fiscal year 1994 could have been
as high as several billion dollars because workers were unable to perform
their jobs while awaiting a clearance.25 While newer overall cost
estimates are not available, the underlying reasons-the delays in
determining clearance eligibility that we documented in this report-still
exist today.

The impact of delays in completing initial clearances affects industry,
and therefore affects the U.S. government, which is funding the work that
requires the clearances. In a May 2006 congressional hearing, a
representative for a technology association testified that retaining
qualified personnel is resulting in salary premiums as high as 25 percent
for current clearance holders. The association representative went on to
note that such premiums raise costs to industry, which in turn passes on
the costs to the government and taxpayers.26 In 2004, representatives of a
company with $1 billion per year in sales stated that their company
offered $10,000 bonuses to its employees for each person recruited who
already had a security clearance. In cases where recruits left for the
company in question, their former companies faced the possibility of
having to back-fill a position, as well as possibly settling for a lower
level of contract performance while a new employee was found, obtained a
clearance, and learned the former employee's job. Also, industry
representatives discussed instances where their companies gave hiring
preferences to cleared personnel who could do the job but were less
qualified than others who did not possess a clearance. The chair of the
interagency Personnel Security Working Group at the time of our 2004
report noted that a company might hire an employee and begin paying that
individual, but not assign any work to the individual until a clearance is
obtained. Also, the head of the interagency group noted that commands,
agencies, and industry might incur lost-opportunity costs if the
individual chooses to work somewhere else rather than wait to get the
clearance before beginning work.

23 GAO, DOD Personnel Clearances: DOD Needs to Overcome Impediments to
Eliminating Backlog and Determining Its Size, GAO-04-344 (Washington,
D.C.: Feb. 9, 2004).

24 GAO, Faster Processing of DOD Personnel Security Clearances Could Avoid
Millions in Losses, GAO/GGD-81-105 (Washington, D.C.: Sept. 15, 1981).

25 Joint Security Commission, Redefining Security: A Report to the
Secretary of Defense and the Director of Central Intelligence, Chapter 4,
Personnel Security-The First and Best Defense (Washington, D.C.: Feb. 28,
1994).

The negative effects of the failure to deliver timely determinations of
initial clearance eligibility extend beyond industry personnel to
servicemembers and federal employees. An April 2006 DOD Office of
Inspector General report provided examples to illustrate how delays in the
clearance process can result in negative consequences such as
nonproductive time waiting for a clearance. That report noted that delays
have caused students at military training facilities to remain in a
holdover status while waiting for a final clearance to complete training
courses, graduate, or deploy. In addition, students without a final
clearance may have their duty stations changed, which impacts their
ability to fully support DOD missions for which they were trained.27

Delays in completing clearance updates can have serious but different
negative consequences than those stemming from delays in completing
initial clearance-eligibility determinations. Delays in completing
clearance updates may lead to a heightened risk of national security
breaches. Such breaches involve the unauthorized disclosure of classified
information, which can have effects that range from exceptionally grave
damage to national security in the case of top secret information to
damage in the case of confidential information.28 In 1999, the Joint
Security Commission reported that delays in initiating investigations for
clearance updates create risks to national security because the longer
individuals hold clearances the more likely they are to be working with
critical information systems.29

26 Doug Wagoner, statement for the record, hearing before the Committee on
Government Reform, U.S. House of Representatives (May 17, 2006).

27 DOD Office of the Inspector General, Human Capital: DOD Security
Clearance Process at Requesting Activities, D-2006-077 (Arlington, Va.:
Apr. 19, 2006).

OPM's Timeliness Reporting Does Not Convey Full Magnitude of Delays

The timeliness statistics that OPM30 provided in the recent congressional
hearings do not convey the full magnitude of the investigations-related
delays facing the government. In her May 17, 2006, congressional testimony
statement, the Associate Director in charge of OPM's investigations unit
said that OPM continued to make "significant progress" in reducing the
amount of time needed to complete initial security clearance
investigations. She supported her statement with statistics that showed
OPM's initial investigations for top secret clearances governmentwide
averaged 284 days in June 2005 and decreased to 171 days in April 2006
(see table 3).31 When we converted these two timeliness statistics to a
percentage, we found that the average time to complete an investigation
for an initial top secret clearance in April 2006 was about 60 percent of
what it had been in June 2005. We also calculated the percentage change
for the numbers of investigations completed in the same 2 months and found
that OPM had completed about 68 percent (5,751 versus 8,430) as many
initial investigations for top secret clearances in April 2006 as it did
in June 2005. Her statement went on to mention that another problem was
developing-the inventory of pending investigations was increasing because
of difficulty obtaining information from third-party providers.

28 5 C.F.R. S: 1312.4, Classification of National Security Information
(2006).

29 Joint Security Commission II, Report of the Joint Security Commission
II (Aug. 24, 1999), pp.5-6.

30 As we mentioned earlier, the governmentwide plan states that except for
a limited number of programs, OMB Memorandum M-05-17 delegated OPM
responsibility for the day-to-day oversight and monitoring of security
clearance investigations, including investigations for clearance updates.

31 OPM, Progress or More Problems: Assessing the Federal Government's
Security Clearance Process, Statement of Kathy L. Dillaman, before the
Subcommittee on Oversight of Government Management, the Federal Workforce,
and the District of Columbia, Committee on Homeland Security and
Governmental Affairs, U.S. Senate (Washington, D.C.: May 17, 2006).

Table 3: Statistics on the Timeliness of Initial Investigations that OPM
Provided in Its Testimony Statement to Congress on May 17, 2006

                                               October        April  
Clearance (and        June 2005                 2005           2006  
type of           Average    Average          Average 
investigation)  N    days  N    days       N     days 
Top secret                                                   
clearance                                                    
(single scope                                                
background                                                   
investigation)                                               
Priority                               1,168       58         1,170     38           692     53
All                                    8,430      284         8,589    231         5,751    171
Secret and                                                                               
confidential                                                                             
clearances                                                                               
(national                                                                                
agency checks                                                                            
with law check                                                                           
and credit)                                                                              
Priority                                 827       95           908     53           922     64
All                                   34,727      163        33,521    134        32,491    145

Source: OPM.

Note: OPM extracted the above information from their Personnel
Investigations Processing System (PIPS). In our review, we found that some
entries for the investigations start date were inaccurate.

The testimony statement did not provide timeliness statistics for the
investigations that are conducted for clearance updates, but that type of
investigation probably had longer completion times than did the initial
investigations. Our previously reviewed statistics on industry personnel
(see table 2) indicated that clearance update investigations took about 1
1/2 times as long as the initial investigations. The absence of
information on clearance-update investigations from the OPM's Associate
Director's testimony statement may be partially explained by the higher
priority that OMB and OPM have placed on completing initial clearances so
that individuals who have not previously had clearances can begin
classified work sooner. At the same time, the absence of information on
clearance-update investigations does not provide all
stakeholders-Congress, agencies, contractors attempting to fulfill their
contracts, and employees awaiting their clearances-with a complete picture
of clearance delays. We have noted in the past that focusing on completing
initial clearance investigations could negatively affect the completion of
clearance-update investigations and thereby increase the risk of
unauthorized disclosure of classified information.

The testimony statement did not indicate whether or not the statistics on
complete investigations included a type of incomplete investigation that
OPM sometimes treats as being complete. In our February 2004 report, we
noted that OPM's issuance of "closed pending" investigations-investigative
reports sent to adjudication facilities without one or more types of
source data required by the federal investigative standards-causes
ambiguity in defining and accurately estimating the backlog of overdue
investigations. In our February 2004 report, we also noted that cases that
are closed pending the provision of additional information should continue
to be tracked separately in the investigations phase of the clearance
process. According to recently released OPM data, between February 20,
2005, and July 1, 2006, the number of initial top secret clearance
investigative reports that were closed pending the provision of additional
information increased from 14,841 to 18,849, a 27 percent increase. DISCO
officials and representatives from some other DOD adjudication facilities
have indicated that they will not adjudicate closed pending cases since
critical information is missing. OPM, however, has stated that other
federal agencies review the investigative reports from closed pending
cases and may determine that they have enough information for
adjudication. Combining partially completed investigations with fully
completed investigations overstates how quickly OPM is supplying
adjudication facilities with the information they request to make their
clearance-eligibility determinations.

OPM told us that it does not continue counting the time when agencies
return investigative reports for rework because they were in some way
deficient. Instead, OPM begins the count of days in the investigative
phase anew. OPM says that approximately 1 to 2 percent of its
investigations are reopened for such work. OPM has indicated that system
problems prevent them from continuing to monitor these returned
investigations as a continuation of the prior investigations. By not fully
capturing all investigative time-including the review time which occurred
at the adjudication facility and resulted in returning a report-OPM is
undercounting the number of days that it takes to conduct an
investigation.

Finally, our analysis of OPM's quarterly reports, which are provided to
OMB and Congress, revealed computational errors. For example, using
information from such reports, we found that the number of adjudications
completed in the second quarter of 2006 was off by about 12,000 cases. One
reason for the errors was mistakes in the programs used to extract the
data from OPM's database, rather than the use of a documented and verified
computer program that can be used again as data are updated. Without
complete and accurate data and analyses, Congress, OMB, and others do not
have full visibility over the timeliness of the clearance process.

 OPM Delivered Incomplete Investigative Reports and DISCO Adjudicated Cases Did
            Not Document All Clearance-determination Considerations

OPM provided incomplete investigative reports to DOD adjudicators, which
they used to determine top secret clearance eligibility. Almost all (47 of
50) of the sampled investigative reports we reviewed were incomplete based
on requirements in the federal investigative standards. In addition, DISCO
adjudicators granted clearance eligibility without requesting additional
information for any of the incomplete investigative reports and did not
document that they considered some adjudicative guidelines when adverse
information was present in some reports. Granting clearances based on
incomplete investigative reports increases risks to national security. In
addition, use of incomplete investigative reports and not fully
documenting adjudicative considerations may undermine the government's
efforts to increase the acceptance of security clearances granted by other
federal agencies.

Almost All of the Sampled Investigative Reports Were Incomplete

In our review of 50 initial investigations randomly sampled from the
population used in our timeliness analyses, we found that almost all (47
of 50) of the investigative reports were missing documentation required by
the federal investigative standards. The missing data were of two general
types: (1) the absence of documentation showing that an investigator
gathered the prescribed information in each of the applicable 13
investigative areas and included requisite forms in the investigative
report, and (2) information to help resolve issues (such as conflicting
information on indebtedness) that were raised in other parts of the
investigative report.32 The requirements for gathering these types of
information were identified in federal investigative standards published
about a decade ago.33 We categorized an investigative area as incomplete
if the investigative report did not contain all of the required
documentation for that area or issue resolution. For example, we
categorized the employment area as incomplete if investigators did not
document a check of the subject's employee personnel file or the required
number of interviews of employment references such as supervisors and
coworkers.

32 We reviewed the investigative reports for the presence or absence of
the documentation. Available information often did not allow a
determination of why the documentation was missing. For example, required
documentation could be missing because an investigator failed to either
perform the activity involved in gathering the information or submit the
information after it had been gathered. In either case, an investigative
report would not provide an adjudicator with all of the information
prescribed in the federal investigative standards.

33 The White House, "Implementation of Executive Order 12968," Memorandum
(Washington, D.C.: Mar. 24, 1997). This memorandum approves the
adjudication guidelines, temporary eligibility standards, and
investigative standards required by Executive Order 12968, Access to
Classified Information (Aug. 2, 1995). We obtained additional information
on the operations used to obtain and document investigative information by
attending OPM's 3-week investigator training and from OPM's guidance to
its investigators: OPM, Investigator's Handbook (Draft version 5, March
2005).

At least half of the 50 reports that we examined did not contain the
required documentation in three investigative areas: residence,
employment, and education (see fig. 2). In addition, many investigative
reports contained multiple deficiencies within each of these areas. For
example, multiple deficiencies might be present in the residence area
because investigators did not document a rental record check and an
interview with a neighborhood reference.

Figure 2: Number of OPM-prepared Investigative Reports Missing at Least
One Piece of Documentation for 12 of the 14 Typesa of Information-Cases
Adjudicated in January and February 2006

aThe federal investigative standards and OPM's Investigator's Handbook
identify 13 investigative areas that require documentation and also
require that the investigation forms be included in the investigative
report. Some reports were missing one or more pieces of documentation for
at least one investigative area (e.g., three of the required 10 employment
interviews for a subject with five jobs), and other reports were missing
documentation in multiple investigative areas (e.g., both residence and
employment information). Two of the types of information-financial records
and subject interview-were included in all 50 cases we examined.

Looking at the data for figure 2 in a different way shows that three of
every five reports that we reviewed had at least three investigative areas
that did not have all of the prescribed documentation. Thirty-eight of the
50 investigative reports had two to four investigative areas with at least
one piece of missing documentation (see fig. 3).

Figure 3: Number of Deficient Areas in Each OPM-prepared Investigative
Report-Cases Adjudicated in January and February 2006a

aSome reports contained multiple deficiencies in a given investigative
area.

The following examples illustrate some of the types of documentation
missing from the investigative reports that we reviewed. When we discussed
our findings for these investigative reports with OPM Quality Management
officials, they agreed that the OPM investigators should have included
documentation in the identified investigative areas.

           o  Residence, social, and employment documentation were missing.
           One investigative report did not have documentation on all of the
           required residence interviews or to show they checked rental
           records at two of the subjects' residences. In addition, it
           contained no information from required investigator-developed
           social references, but information from interviews with two
           subject-identified social references was in the report. Federal
           investigative standards require investigators to interview at
           least two of the subject-identified social references and two
           additional social references that the investigator develops during
           the course of the investigation. Finally, investigators documented
           performing only 3 of the 10 employment interviews that would be
           required for the subject's five jobs covered by the investigative
           scope.34

           o  Residence, social, and employment documentation were missing.
           An investigative report on a DOD industry employee did not contain
           documentation on interviews with any neighborhood references where
           the subject had resided for 10 years. Similarly, the report
           contained interview documentation from one subject-identified but
           no investigator-developed social reference. Of the eight
           employment reference interviews required by federal standards for
           this investigative report, there was documentation that three were
           performed.35

           o  Spouse national record documentation was missing. In another
           investigative report, required documentation for four national
           agency record checks of the subject's cohabitant of 35 years was
           missing. The four types of missing checks were the Federal Bureau
           of Investigation name and fingerprints, OPM's Security/Suitability
           Investigations Index, and DOD's Spouse Defense Clearance and
           Investigations Index.

           Although federal standards indicate that investigations may be
           expanded as necessary to resolve issues, according to OPM, (1)
           issue resolution is a standard part of all initial investigations
           and periodic reinvestigations for top secret clearances and (2)
           all issues developed during the course of an investigation should
           be fully resolved in the final investigative report provided to
           DOD. We found a total of 36 unresolved issues in 27 of the
           investigative reports. The three investigative areas with the most
           unresolved issues were financial consideration, foreign influence,
           and personal conduct (see fig. 4).

           Figure 4: Number of OPM-prepared Investigative Reports with at
           Least One Unresolved Issue by Investigative Area-Cases Adjudicated
           in January and February 2006

           The following examples highlight investigative areas that lacked
           the documentation needed to resolve an issue. When we reviewed
           these investigative reports with OPM Quality Management officials,
           they agreed that the investigators should have included
           documentation to resolve the issues.

           o  Personal conduct and financial issues were unresolved. One
           investigative report did not contain documentation of the
           resolution of possible extramarital affairs and financial
           delinquency. During the course of the investigation, the subject
           reported having extramarital affairs; however, there was no
           documentation to show that these affairs had been investigated
           further. Also, the subject's clearance application indicated
           cohabitation with an individual with whom the subject had
           previously had a romantic relationship, but there was no
           documentation that record checks were performed on the cohabitant.
           Moreover, information in the investigative report indicated that
           the subject defaulted on a loan with a balance of several thousand
           dollars; however, no other documentation suggested that this issue
           was explored further.
           o  Foreign influence issues were unresolved. The clearance
           application showed that the subject had traveled to an Asian
           country to visit family. However, in the subject interview, the
           subject reported not knowing the names of the family members or
           the city in which one relative lived. There was no documentation
           in other parts of the investigative report of a follow-up
           discussion with the subject about this issue.

           o  Financial issues were unresolved. An industry employee
           indicated "no" in his clearance application when asked if during
           the last 7 years he had a lien placed against his property for
           failing to pay taxes or other debt, but information in another
           part of the investigative report indicated that a tax lien in the
           tens of thousands of dollars had been placed against his property.
           The investigative report did not have additional information to
           indicate whether or not investigators asked the subject about the
           omission on the application or the tax lien itself.

           Although we found that the interview narratives in some of the 50
           OPM investigative reports were limited in content, we did not
           identify them as being deficient for the purposes of our
           statistical analysis because such an evaluation would have
           required a subjective assessment that we were not willing to make.
           For example, in our assessment of the presence or absence of
           documentation, we found a 35-word narrative for a subject
           interview of a naturalized citizen from an Asian country. It
           stated only that the subject did not have any foreign contacts in
           his birth country and that he spent his time with family and
           participated in sports. Nevertheless, others with more
           adjudicative expertise voiced concern about the issue of
           documentation adequacy. At their monthly meeting in April 2006,
           top officials representing DOD's adjudication facilities were in
           agreement that OPM-provided investigative summaries had been
           inadequate. The OPM Investigator's Handbook provides guidance that
           directs investigators to be brief in the interview narratives but
           not to sacrifice content. Narrative documentation is required for
           subject interviews and all interviews with references contacted in
           the investigation, including neighbors, character references, and
           coworkers.

           The Associate Director of OPM's investigations unit and her
           Quality Management officials cited the inexperience of the
           investigative workforce as one of the possible causes for the
           incomplete investigative reports we reviewed. This inexperience is
           due to the fact that OPM has rapidly increased the size of the
           investigative workforce. In December 2003, GAO estimated that OPM
           and DOD had around 4,200 full-time equivalent investigative
           personnel. In May 2006, the Associate Director said that OPM had
           over 8,600 employees. The Associate Director also indicated that
           variations in the training provided to federal and contractor
           investigative staff could be another reason for the
           incompleteness. These variations can occur since each contract
           investigative company is responsible for developing the training
           course for its employees. She, however, added that OPM (1)
           publishes the Investigator's Handbook that provides guidance on
           how to conduct an investigation and forms the basis for the
           training, (2) approves the training curriculum for each
           contractor, and (3) occasionally monitors actual training
           sessions.

           The Associate Director also noted that she had little indication
           from her customers-adjudicators-that the investigative reports had
           problems since adjudicative facilities were returning 1 to 2
           percent of the reports for rework. In our November 2005 testimony
           evaluating the government plan for improving the personnel
           security clearance process, we noted that the number of
           investigations returned for rework is not by itself a valid
           indicator of the quality of investigative work because
           adjudication officials said they were reluctant to return
           incomplete investigations in anticipation of further delays. We
           went on to say in November 2005 that regardless of whether that
           metric remains a part of the government plan, developers of the
           plan may want to consider adding other indicators of the quality
           of investigations. When we asked if OMB and OPM had made changes
           to the government plan to address quality-measurement and other
           shortcomings that we had identified in our November 2005
           testimony, the Associate Director said the plan had not been
           modified to address our concerns but implementation of the plan
           was continuing.

           OPM's Associate Director outlined new quality control procedures
           that were put in place after the investigations that we reviewed
           were completed. Among other things, OPM has a new contractor
           responsible for reviewing the quality of its investigative
           reports, a new organizational structure for its quality control
           group, and new quality control processes. After describing these
           changes, the Associate Director acknowledged that it will take
           time before the positive effects from the changes will be fully
           realized.

           DISCO Adjudicators Granted Top Secret Clearance Eligibility for
			  Cases with Missing Information
			  
			  DISCO adjudicators granted top secret clearance eligibility for
           the 27 industry personnel whose investigative reports contained
           unresolved issues without requesting additional information or
           documenting in the adjudicative report that the information was
           missing. Furthermore, in 17 cases, adjudicators did not document
           consideration of guidelines. In making clearance-eligibility
           determinations, the federal guidelines require adjudicators to
           consider (1) guidelines covering 13 specific areas such as foreign
           influence and financial considerations, (2) adverse conditions or
           conduct that could raise a security concern and factors that might
           mitigate (alleviate) the condition for each guideline, and (3)
           general factors related to the whole person. (See app. II for
           additional details on these three types of adjudicative
           considerations.) According to a DISCO official, DISCO and other
           DOD adjudicators are to record information relevant to each of
           their eligibility determinations in JPAS. They do this by
           selecting applicable guidelines and mitigating factors from
           prelisted responses and may type up to 3,000 characters of
           additional information.

           DISCO adjudicators granted clearance eligibility for 27 industry
           personnel whose investigative reports did not contain the required
           documentation to resolve issues raised in other parts of the
           investigative reports (see fig. 4). The corresponding adjudicative
           reports for the 27 industry personnel did not contain
           documentation showing that adjudicators had identified the
           information as missing or that they attempted to return the
           investigative reports to obtain the information required by the
           federal adjudicative guidelines. The following are examples of
           unresolved issues that we found in adjudicative and investigative
           reports and later discussed with DISCO officials, including
           administrators and adjudicators. For both examples, the DISCO
           officials agreed that additional information should have been
           obtained to resolve the issues before the industry personnel were
           granted top secret clearances.

           o  Information to resolve a foreign influence issue was missing. A
           state-level record check on an industry employee indicated that
           the subject was part owner of a foreign-owned corporation.
           Although the DISCO adjudicator applied the foreign influence
           guideline for the subject's foreign travel and mitigated that
           foreign influence issue, there was no documentation in the
           adjudicative report to acknowledge or mitigate the foreign-owned
           business.

           o  Information to resolve a foreign influence issue was missing.
           An industry employee reported overseas employment on their
           application, but the subjects adjudicative and investigative
           reports did not contain other documentation of the 6 years (all
           within the scope of the investigation) that they spent working for
           a DOD contractor in two European countries. For example, the
           subject interview documentation did not indicate whether the
           subject's relationships with foreign nationals had been addressed.
           The adjudicative and investigative reports did not document
           verification of the subject's residence and interviews with
           overseas social references. Furthermore, the adjudicative report
           did not indicate that the foreign influence guideline was
           considered as part of the clearance determination.

           When asked why the adjudicators did not provide the required
           documentation in JPAS, the DISCO officials said that its
           adjudicators review the investigative reports for sufficient
           documentation to resolve issues and will ask OPM to reopen a case
           if they do not have enough information to reach an eligibility
           determination. The DISCO officials and Defense Security Service
           Academy personnel who teach adjudicator training courses cited
           risk management as a reason that clearance determinations are made
           without full documentation. They said that adjudicators make
           judgment calls about the amount of risk associated with each case
           by weighing a variety of past and present, favorable and
           unfavorable information about the person to reach an eligibility
           determination. The trainers also said that adjudicators understand
           that investigators may not be able to obtain all of the
           information needed to resolve all issues. Notably, DISCO and DOHA
           officials told us that DISCO adjudicators determine eligibility
           for cases with few or no issues and that DOHA adjudicates cases
           with potentially more serious issues.

           Seventeen of the 50 adjudicative reports were missing
           documentation on a total of 22 guidelines for which issues were
           present in the investigative reports.36 The guideline
           documentation missing most often was for foreign influence,
           financial considerations, alcohol consumption, and personal
           conduct issues (see fig. 5). We, like DISCO adjudicators, used the
           Adjudicative Desk Reference and DOD's Decision Logic Table to help
           determine whether or not documentation of a guideline was
           needed.37 An example of the lack of documentation shown in figure
           5 was when DISCO adjudicators did not record consideration of the
           personal conduct guideline despite a subject's involvement in an
           automobile accident while driving with a suspended driver's
           license, no auto insurance, and an expired car license.

           Figure 5: Number of DISCO-prepared Adjudicative Reports that Did
           Not Document Issues Specified in Adjudicative Guidelines in the
           Presence of Adverse Information, Cases Adjudicated in January and
           February 2006

           DISCO officials stated that procedural changes associated with
           JPAS implementation contributed to the missing documentation on
           guidelines. DISCO began using JPAS in February 2003, and it became
           the official system for all DOD adjudications in February 2005.
           Before February 2005, DISCO adjudicators were not required to
           document the consideration of a guideline issue unless adverse
           information could disqualify an individual from being granted
           clearance eligibility. After JPAS implementation, DISCO
           adjudicators were trained to document in JPAS their rationale for
           the clearance determination and the adverse information from the
           investigative report, regardless of whether or not an adjudicative
           guideline issue could disqualify an individual from obtaining a
           clearance. The administrators also attributed the missing
           guideline documentation to a few adjudicators attempting to
           produce more adjudication determinations.

           Delivery and Use of Incomplete Investigations Increase Risks
			  to National Security and Reciprocity
			  
			  Decisions to grant clearances based on incomplete investigations
           increase risks to national security because individuals can gain
           access to classified information without being vetted against the
           full federal standards and guidelines. Although there is no
           guarantee that individuals granted clearances based on complete
           investigations will not engage in espionage activities, complete
           investigations are a critical first step in ensuring that those
           granted access to classified information can be trusted to
           safeguard it.

           Adjudicators' reviews of incomplete investigative reports can have
           negative economic consequences for adjudication facilities,
           regardless of whether the incomplete report is (1) an inadvertent
           failure by OPM to detect the missing information during its
           quality control procedures or (2) a conscious decision to forward
           a closed pending case that OPM knows is not complete.
           Specifically, adjudication facilities must use adjudicator time to
           review cases more than once and then use additional time to
           document problems with the incomplete investigative reports.
           Conversely, an adjudicative review of incomplete cases could have
           the benefit of alerting adjudicators to negative information on a
           person who has been granted an interim initial clearance so that
           the adjudication facility could determine whether that interim
           clearance should be revoked pending a full investigative report.

           Incomplete investigations and adjudications undermine the
           government's efforts to move toward greater clearance and access
           reciprocity. An interagency working group, the Security Clearance
           Oversight Steering Committee,38 has noted that agencies are
           reluctant to be accountable for poor quality investigations and/or
           adjudications conducted by other agencies or organizations. To
           achieve fuller reciprocity, clearance-granting agencies need to
           have confidence in the quality of the clearance process. Without
           full documentation of investigative actions, information obtained,
           and adjudicative decisions, agencies could continue to require
           duplicative investigations and adjudications.

           Conclusions
			  
			  Incomplete timeliness data limit the visibility of stakeholders
           and decision makers in their efforts to address long-standing
           delays in the personnel security clearance process. For example,
           not accounting for all of the time that is required when industry
           personnel submit an application multiple times before it is
           accepted limits the government's ability to accurately monitor the
           time required for each step in the application-submission phase
           and identify positive steps that facility security officers, DISCO
           adjudicators, OPM investigative staff, and other stakeholders can
           take to speed the process. Similarly, OPM's procedure of
           restarting the measurement of investigation time for the 1 to 2
           percent of investigative reports that are sent back for quality
           control reasons does not hold OPM fully accountable for total
           investigative time when deficient products are delivered to its
           customers. In fact, restarting the time measurement for reworked
           investigations could positively affect OPM's statistics if the
           reworked sections of the investigation take less time than did the
           earlier effort to complete the large portion of the investigative
           report. Information-technology-related problems are another area
           where needless delays are being experienced. Failure to fully
           utilize e-QIP adds about 2 weeks to the application-submission
           time, and the government must pay to have information key-entered
           into OPM's investigative database. Likewise, an estimated 2 to 3
           weeks are added to the adjudication phase because of the need to
           print and ship investigative reports to DISCO and other
           adjudication facilities. These and other reasons for delays show
           the fragmented approach that the government has taken to
           addressing the clearance problems. In November 2005, we were
           optimistic that the government plan for improving the clearance
           process prepared under the direction of OMB's Deputy Director for
           Management would be a living document that would provide the
           strategic vision for correcting long-standing problems in the
           personnel security clearance process. However, OPM recently told
           us that the plan has not been modified in the 9 months since we
           labeled it as an important step forward but identified numerous
           shortcomings that should be addressed to make it a more powerful
           vehicle for change.

           While eliminating delays in the clearance process is an important
           goal, the government cannot afford to achieve that goal by
           providing investigative and adjudicative reports that are
           incomplete in key areas required by federal investigative
           standards and adjudicative guidelines. The lack of full
           reciprocity of clearances is an outgrowth of agencies' concerns
           that other agencies may have granted clearances based on
           inadequate investigations and adjudications. OMB's Deputy Director
           of Management has convened an interagency committee to address
           this problem and has taken steps to move agencies toward greater
           reciprocity. The findings in this report may suggest to some
           security managers that there is at least some evidence to support
           agencies' concerns about the risks that may come from accepting
           the clearances issued by other federal agencies. Readers are
           reminded, however, that our review and the analyses presented here
           looked at only one aspect of quality-completeness of reports. We
           could not address whether the information contained in the
           investigative reports we reviewed was adequate for determining
           clearance eligibility and whether all 50 of the industry personnel
           should have been granted clearances. Such judgments are best left
           to fully trained, experienced adjudicators. Still, our findings do
           raise questions about (1) the adequacy of the procedures that OPM
           used to ensure quality before sending its investigative reports to
           its customers and (2) DISCO's procedures for reviewing the quality
           of the clearance determinations made by its adjudicators when
           information was missing from the investigative reports or
           decisions were not fully documented in JPAS. Furthermore, as we
           pointed out in November 2005, the almost total absence of quality
           metrics in the governmentwide plan for improving the clearance
           process hinders Congress's oversight of these important issues.
           Finally, the missing documentation could have longer term negative
           effects such as requiring future investigators and adjudicators to
           obtain the documentation missing from current reviews when it is
           time to update the clearances currently being issued.

           Recommendations for Executive Action
			  
			  To improve the timeliness of the processes used to determine
           whether or not industry personnel are eligible for a top secret
           clearance, we are making the following recommendations to the
           Director of the Office of Management and Budget to direct the
           Deputy Director for Management, in his oversight role of the
           governmentwide clearance process, to take the following actions:

           o  Direct OPM and DOD to fully measure and report all of the time
           that transpires between when the application is initially received
           by the federal government to when the clearance-eligibility
           determination has been provided to the customer. Inherent in this
           recommendation to increase transparency is the need to provide all
           stakeholders (including facility security officers, federal and
           contract investigators, and adjudicators) information about each
           of their steps within the clearances phases so that each can
           develop goals and implement actions to minimize delays.

           o  Establish an interagency working group to identify and
           implement solutions for investigative and adjudicative information
           technology problems-such as some parts of DOD continuing to submit
           paper copies of the clearance application, or inefficiencies-such
           as the continued distribution of paper investigative reports-that
           have resulted in clearance delays.

           To improve the completeness of the documentation for the processes
           used to determine whether or not industry personnel are eligible
           for a top secret clearance and to decrease future concerns about
           the reciprocal acceptance of clearances issued by other agencies,
           we are recommending that the Director of the Office of Management
           and Budget direct the Deputy Director for Management, in his
           oversight role of the governmentwide clearance process, to take
           the following actions:

           o  Require OPM and DOD to (1) submit to the Deputy Director their
           procedures for eliminating the deficiencies that we identified in
           their investigative and adjudicative documentation and (2) develop
           and report metrics on completeness and other measures of quality
           that will address the effectiveness of the new procedures.

           o  Update the government strategic plan for improving the
           clearance process to address, among other things, the weaknesses
           that we identified in the November 2005 version of the plan as
           well as the timeliness and incompleteness issues identified in
           this report, and widely distribute it so that all stakeholders can
           work toward the goals that they can positively impact.

           o  Issue guidance that clarifies when, if ever, adjudicators may
           use incomplete investigative reports-closed pending and
           inadvertently incomplete cases-as the basis for granting clearance
           eligibility.

           Agency Comments
			  
			  We received agency comments from OMB, DOD, and OPM (see apps. III,
           IV, and V, respectively). In addition, OMB and OPM provided
           separate technical comments which we incorporated in the final
           report, as appropriate.

           Office of Management and Budget
			  
			  In his comments to our report, OMB's Deputy Director for
           Management did not take exception to any of our recommendations.
           Among other things, he noted his agreement with our report's
           conclusion that agencies must identify and implement new
           investigative and adjudicative solutions to improve the quality
           and timeliness of background investigations. The Deputy Director
           stated that National Security Council's Security Clearance Working
           Group had begun to explore ways to identify and implement such
           improvements. He also said that the quality of the investigations
           and adjudications are of paramount concern and that he would ask
           the National Security Council's Personnel Security Working Group
           to determine when, if ever, an adjudicator may use incomplete
           investigative reports to determine whether to grant a security
           clearance.

           Department of Defense
			  
			  Although our recommendations were not directed to DOD, the Deputy
           Under Secretary of Defense (Counterintelligence and Security)
           noted his concurrence with our recommendations. The Deputy Under
           Secretary also discussed the use of incomplete cases as the basis
           for adjudication. He maintained that when the unresolved issues
           appear to be of minor importance, a risk management adjudication
           may be prudent. After noting that patchwork fixes will not solve
           the fundamental problem-"the current process takes too long, costs
           too much, and leaves us with a product of uncertain quality"-the
           Deputy Under Secretary reported that DOD is working on a new
           process.

           Office of Personnel Management
			  
			  In her written comments, OPM's Director stated that she fully
           supported the intent of our report but expressed concern that we
           had based our findings upon a number of inaccurate facts. We
           disagree. To address the Director's concerns, we grouped her
           concerns into four general categories as discussed below.

           The Director stated that a fair comparison cannot be made between
           PIPS (OPM's investigative database) and JPAS (DOD's clearance
           database that also includes investigative timeliness data). As our
           scope and methodology section makes clear, we did report
           information from OPM and DOD databases, but the focus of our
           report was not a comparison of databases. While we did present
           timeliness findings based on the two databases, we did not perform
           comparisons-a condition that would have required us to report
           statistics on the same population for the same time period.
           Instead, our draft report clearly noted when we were supplementing
           our findings from the DOD database with more recent statistics
           from OPM. We also noted that the OPM findings were governmentwide.
           Therefore, we are puzzled by the Director's comment since we
           supplied the additional OPM-provided statistics in our efforts to
           present a balanced view and reflect OPM's statements that
           investigation timeliness had improved. The Director's later
           statement that a fair comparison cannot be made between the data
           in the two systems is troubling because underpinning effective
           oversight is the prerequisite for reliable data. Regardless of
           whose data are used, the two databases should produce timeliness
           statistics that agree and cover the full periods that IRTPA
           require to be monitored: total clearance process, investigations,
           and adjudications.

           The Director took exception to our report's assertion that
           stakeholders and decision makers are limited in their ability to
           address delays in the security clearance process because of
           incomplete timeliness data. She stated that OPM feels stakeholders
           and decision makers have the most comprehensive data possible to
           understand and address the delays in the security clearance
           process. At the same time, other parts of her comments noted
           deficiencies in OPM's timeliness data. For example, she noted that
           OPM does "not account for the timeliness of multiple submissions"
           [of applications], and that OPM only measures "timeliness from
           beginning to the point where OPM has completed all items under our
           direct control via the Closed Pending process." We stand behind
           our assertion that OPM has incomplete timeliness data, and we
           believe the Director's admissions about the limitations of the OPM
           data reinforce the empirical basis of our assertion. The evidence
           supplied in our draft report further contradicts the Director's
           assertion that stakeholders and decision makers have the most
           comprehensive data possible. Our approach for investigating
           timeliness and completeness is fully described in our scope and
           methodology, including the specific steps that we took. For
           example, we sent written questions and verbally inquired with OPM
           staff about whether OPM tracked timeliness for certain situations,
           and the staff's written and verbal answers to those questions
           indicated that the agency does not measure the timeliness of
           situations such as multiple submissions and the full period
           required to conduct an investigation when the investigative report
           is returned because of quality problems. IRTPA did not identify
           situations that could be excluded from mandated timeliness
           assessments. Therefore, we stand by our conclusion that without
           fully accounting for the total time needed to complete the
           clearance process, OMB and Congress will not be able to accurately
           determine whether agencies have met future IRTPA requirements.

           Concerning our findings that initial clearances took 446 days and
           clearance updates took 545 days, the director noted that a sample
           of current cases would likely show a marked improvement in
           consistency and would reflect the many process improvements that
           have been put in place since the time of transfer. Also, she
           indicated that some of the problems that we reported were the
           result of transferred staff and cases. We agree that it is
           possible that different findings might be obtained if a more
           recent population were examined today. However, the population
           that we examined represented the most up-to-date information
           available when we began our timeliness analyses. With regard to
           the Director's statement that some of the problems were caused by
           the transfer of investigative functions and personnel from DOD,
           OPM had 2 years to prepare for the transfer between the announced
           transfer agreement in February 2003 and its occurrence in February
           2005. In addition, 47 of the 50 investigative reports that we
           reviewed were missing documentation even though OPM has quality
           control procedures for reviewing the reports before they are sent
           to DOD.

           Lastly, the Director indicated that our report discounts the
           government's efforts to correct clearance problems, like the
           impact of IRTPA and the government's Plan for Improving the
           Personnel Security Clearance Process. In addition, the Director
           wrote that the draft report did not address the effects of the
           backlog and agencies' inaccurate projections of investigations
           workload. To the contrary, our draft report discussed each of
           these issues and we believe the report presents a balanced
           assessment of programs-identifying problems, discussing ongoing
           efforts to correct situations, and helping the reader understand
           the context within which a program functions. For example, the
           introduction discussed IRTPA, the development of the plan,
           additional actions that were coordinated through OMB's Deputy
           Director for Management, and the transfer of DOD's investigative
           function to OPM. Similarly, we noted in the
           investigation-completeness section that OPM has increased its
           investigative workforce in recent years. Our draft report also
           identified both concerns as factors that impede the speed with
           which OPM can deliver investigative reports.

           After careful consideration of the OPM Director's concerns, we
           continue to believe our findings and conclusions have merit.

           As arranged with your office, unless you publicly announce its
           contents earlier, we plan no further distribution of this report
           until 30 days from the date of this report. At that time, we will
           send copies of this report to interested congressional members:
           the Director of the Office of Management and Budget; the Secretary
           of Defense; and the Director of the Office of Personnel
           Management. We will also make copies available to others upon
           request. In addition, the report will be available at no charge on
           GAO's Web site at http://www.gao.gov.

           If you or other members have any additional questions about DOD's
           personnel security program, please contact me at (202) 512-5559 or
           [email protected] . Contact points for our Offices of Congressional
           Relations and Public Affairs may be found on the last page of this
           correspondence. GAO staff who made major contributions to the
           correspondence are listed in appendix VI.

           Derek B. Stewart
			  
			  Director, Defense Capabilities and Management

           List of Congressional Requesters

           The Honorable Susan M. Collins Chairman The Honorable Joseph I.
           Lieberman Ranking Minority Member Committee on Homeland Security
           and Governmental Affairs United States Senate

           The Honorable George V. Voinovich Chairman The Honorable Daniel K.
           Akaka Ranking Minority Member Subcommittee on Oversight of
           Government Management, the Federal Workforce, and the District of
           Columbia Committee on Homeland Security and Governmental Affairs
           United States Senate

           The Honorable Barbara A. Mikulski United States Senate

           The Honorable Tom Davis Chairman Committee on Government Reform
           House of Representatives

           The Honorable Christopher Shays Chairman Subcommittee on National
           Security, Emerging Threats and International Relations Committee
           on Government Reform House of Representatives

           Appendix I: Scope and Methodology
			  
			  Scope
			  
			  The scope of our work emphasized the analysis of information on
           top secret clearances for industry personnel. Earlier in this
           report, table 1 showed that all of the investigative information
           needed to determine eligibility for a secret or confidential
           clearance is also required as part of the investigative report
           considered when determining eligibility for a top secret
           clearance. In addition, examining the timeliness and completeness
           of documentation for top secret clearances focused our efforts on
           a level of clearance where greater damage could occur through the
           unauthorized disclosure of classified information. Our examination
           of clearance information for industry personnel continued a line
           of research discussed in our report issued in May 2004. With about
           34 percent of its 2.5 million clearances held by industry
           personnel who are performing contract work for the Department of
           Defense (DOD) and 23 other agencies, this segment of the workforce
           is playing an increasingly larger role in national security.

           Methodology
			  
			  To examine the timeliness of the processes used to determine
           whether or not industry personnel are eligible for a top secret
           clearance, we reviewed various documents, including laws and
           executive orders, DOD security clearance policies, Office of
           Personnel Management (OPM) policies, and the government plan for
           improving the security clearance process. These sources provided
           the criteria that we used in our analyses, as well as insights
           into possible causes for and effects of the delays in obtaining
           timely clearances. We also reviewed clearance-related reports
           issued by organizations such as GAO, DOD's Office of Inspector
           General, and DOD's Personnel Security Research Center. We
           interviewed headquarters policy and program officials from DOD's
           Office of the Under Secretary of Defense for Intelligence
           [OUSD(I)] and OPM and obtained and evaluated additional
           documentation from those officials. In addition, representatives
           from the organizations shown in table 4 provided additional
           interview and documentary evidence that we also evaluated. A major
           focus of our timeliness examination included our analysis of
           computerized data abstracted from the Joint Personnel
           Adjudications System (JPAS) and statistical reports on timeliness
           that OPM produced for DOD. We calculated the number of days
           required for each case for three phases of the process and the
           total process. Missing dates for the start or completion dates for
           a phase prevented the calculation for some cases. Also, we
           eliminated some dates for the phases when the start date was
           chronologically later than the end date. As a result, the number
           of applicable cases varies for each calculation. The abstract was
           for the population of 1,685 industry personnel granted initial top
           secret clearances and 574 industry personnel granted top secret
           clearance updates by the Defense Industrial Security Clearance
           Office (DISCO) during January and February 2006. The
           application-submission and investigation phases of the clearance
           process for those 2,259 industry personnel were started at various
           times prior to the final adjudication determinations. We assessed
           the reliability of the JPAS data by (1) performing electronic
           testing of required data elements, (2) reviewing existing
           information about the data and the system that produced them, and
           (3) interviewing agency officials knowledgeable about the data.
           While we found problems with the accuracy of some of the JPAS
           data, we determined they were sufficiently reliable for selecting
           a sample of cases for our review and for calculating average days
           for the clearance process. DOD and OPM also provided timeliness
           statistics for other time periods, levels of clearances, types of
           personnel, and other federal agencies to provide us with a broader
           context to interpret the timeliness statistics that we extracted
           from the DISCO database abstract.

           Table 4: List of Organizations Contacted to Obtain Information
           Related to the Timeliness and Completeness of Investigations and
           Adjudications
			  
DOD adjudication facilities                                                
                                                                              
      o  Air Force Central Adjudication Facility, Bolling AFB, Washington,    
      D.C.                                                                    
      o  Army Central Adjudication Facility, Fort George Meade, Maryland      
      o  Defense Intelligence Agency, Central Adjudication Facility,          
      Arlington, Virginia                                                     
      o  Defense Industrial Security Clearance Office, Columbus, Ohio         
      o  Defense Office of Hearings and Appeals, Columbus, Ohio               
      o  Navy Central Adjudication Facility, Washington, D.C.                 
      o  National Security Agency Central Adjudication Facility, Linthicum,   
      Maryland                                                                
      o  Washington Headquarters Services, Consolidated Adjudications         
      Facility, Arlington, Virginia                                           
Other governmental agencies and organizations                              
                                                                              
      o  Defense Security Service, Headquarters, Alexandria, Virginia         
      o  Defense Security Service Academy, Linthicum, Maryland                
      o  Information Security Oversight Office, Washington, D.C.              
      o  National Industrial Security Program Policy Advisory Committee,      
      Washington, D.C.                                                        
      o  DOD's Personnel Security Research Center, Monterey, California       
Investigative contractors                                                  
                                                                              
      o  CACI International Inc., Arlington, Virginia                         
      o  Kroll Inc., New York, New York                                       
      o  ManTech, Fairfax, Virginia                                           
      o  System Application and Technologies, Inc., Landover, Maryland        
      o  USIS, Falls Church, Virginia                                         
Investigator associations                                                  
                                                                              
      o  Association of Certified Background Investigators, LaPlata, Maryland 
      o  American Federal Contract Investigators Association, Oceanside,      
      California                                                              
Industry associations                                                      
                                                                              
      o  The Armed Forces Communications and Electronics Association,         
      Fairfax, Virginia                                                       
      o  Aerospace Industries Association, Arlington, Virginia                
      o  Contract Services Association, Arlington, Virginia                   
      o  Information Technology Association of America, Arlington, Virginia   
      o  Intelligence & National Security Alliance, Annapolis Junction,       
      Maryland                                                                
      o  National Defense Industrial Association, Arlington, Virginia 
		
		           Source: GAO.

           To examine the completeness of the documentation of the processes
           used to determine whether or not industry personnel are eligible
           for a top secret clearance, we used the sources identified above
           to answer the timeliness question concerning: laws, executive
           orders, policies, reports, and materials and testimonial evidence
           provided by the organizations listed in table 4. The sources and
           materials provided us with an understanding of the criteria for
           evaluating whether prescribed information was present in or absent
           from investigative and adjudicative reports used in the clearance
           process. Members of the GAO team attended OPM's basic special
           agent training course for 3 weeks to gain a greater understanding
           of investigative procedures and requirements and participated in
           the Defense Security Service Academy's online basic adjudicator
           training to learn more about adjudicative procedures and
           requirements. Following the training, we began a multiple-step
           process to review and analyze the investigative and adjudicative
           documentation associated with DISCO determinations of clearance
           eligibility for industry security clearance cases. We started by
           randomly selecting 50 cases from the population of 1,685 initial
           clearance applications adjudicated by DISCO during January and
           February 2006. Once our sample was selected, we obtained paper
           copies of the completely adjudicated case files. We developed a
           data collection instrument that incorporated information from
           sources such as the federal investigative standards and
           adjudicative guidelines, OPM's Investigator's Handbook (Draft
           Version 5), and DOD's Personnel Security Research Center's Quality
           Rating Form-an analysis tool to help DOD adjudicators assess the
           quality of investigative reports used to make adjudication
           decisions. Our staff who developed the instrument then trained
           other members of our team on how to use the instrument in order to
           ensure the accuracy and consistency of data entry. We refined our
           instrument utilizing feedback from DOD's Personnel Security
           Research Center staff and our pretest of the instrument on cases
           not included in our sample of 50 cases. To ensure the accuracy of
           our work, a second team member independently verified information
           that another team member had initially coded. As part of each
           review, we examined each report of investigation to ensure that
           all of the investigative requirements had been met (e.g.,
           neighborhood reference checks) and to determine if issues that
           were raised as part of the investigation had been resolved by OPM
           investigators. After a thorough review of the investigative report
           and associated materials, we reviewed the JPAS adjudicative
           report. The JPAS report showed the final adjudicative decision,
           including any guidelines that were applied and any mitigating
           information. Our assessment of each case was entered into an
           electronic database and analyzed to determine the completeness of
           the files and to identify areas of deficiency. In addition to
           obtaining statistical findings, we identified 8 cases that best
           illustrated several types of deficiencies identified by our
           reviews and statistical analyses. We then met with investigations
           and adjudications experts from the Defense Security Service
           Academy to discuss several cases. We also discussed our findings
           for each of the 8 cases with investigative experts from OPM's
           Quality Management group and adjudication experts from DISCO. By
           discussing the issues contained in each case with OPM and DOD
           experts, we were able to learn more about the causes of the
           incomplete documentation and confirm the accuracy of our
           observations on 16 percent of our sampled cases. We performed our
           work from September 2005 through August 2006 in accordance with
           generally accepted government auditing standards.

           Appendix II: Criteria for Determining Clearance Eligibility
			  
			  In making determinations of eligibility for security clearances,
           the federal guidelines require adjudicators to consider (1)
           guidelines covering 13 specific areas, (2) adverse conditions or
           conduct that could raise a security concern and factors that might
           mitigate (alleviate) the condition for each guideline, and (3)
           general factors related to the whole person. First, the guidelines
           state that clearance decisions require a common-sense
           determination of eligibility for access to classified information
           based upon careful consideration of the following 13 areas:

           o  allegiance to the United States;

           o  foreign influence, such as having a family member who is a
           citizen of a foreign country;

           o  foreign preference, such as performing military service for a
           foreign country;

           o  sexual behavior;

           o  personal conduct, such as deliberately concealing or falsifying
           relevant facts when completing a security questionnaire;

           o  financial considerations;

           o  alcohol consumption;

           o  drug involvement;

           o  emotional, mental, and personality disorders;

           o  criminal conduct;

           o  security violations;

           o  outside activities, such as providing service to or being
           employed by a foreign country; and

           o  misuse of information technology systems.

           Second, for each of these 13 areas, the guidelines specify (1)
           numerous significant adverse conditions or conduct that could
           raise a security concern that may disqualify an individual from
           obtaining a security clearance and (2) mitigating factors that
           could allay those security concerns, even when serious, and permit
           granting a clearance. For example, the financial consideration
           guideline states that individuals could be denied security
           clearances based on having a history of not meeting financial
           obligations. However, this adverse condition could be set aside
           (referred to as mitigated) if one or more of the following factors
           were present: the financial condition was not recent, resulted
           from factors largely beyond the person's control (e.g., loss of
           employment), or was addressed through counseling.

           Third, the adjudicator should evaluate the relevance of an
           individual's overall conduct by considering the following general
           factors:

           o  the nature, extent, and seriousness of the conduct;

           o  the circumstances surrounding the conduct, to include
           knowledgeable participation;

           o  the frequency and recency of the conduct;

           o  the individual's age and maturity at the time of the conduct;

           o  the voluntariness of participation;

           o  the presence or absence of rehabilitation and other pertinent
           behavioral changes;

           o  the motivation for the conduct;

           o  the potential for pressure, coercion, exploitation, or duress;
           and

           o  the likelihood of continuation or recurrence.

           When the personnel security investigation uncovers no adverse
           security conditions, the adjudicator's task is fairly
           straightforward because there is no security condition to
           mitigate.
			  
			  Appendix III: Comments from the Office of Management and Budget
			  
			  Appendix IV: Comments from the Department of Defense
			  
			  Appendix V: Comments from the Office of Personnel Management
			  
			  Appendix VI: Contact and Staff Acknowledgments

           GAO Contact
			  
			  Derek B. Stewart (202) 512-5559 or [email protected]

           Acknowledgments
			  
			  In addition to the contact above, Jack E. Edwards, Assistant
           Director; Jim D. Ashley; Jerome A. Brown; Kurt A. Burgeson; Susan
           C. Ditto; David S. Epstein; Cindy K. Gilbert; Cynthia L. Grant;
           Sara G. Hackley; James P. Klein; Ron La Due Lake; Kenneth E.
           Patton; and Jennifer L. Young made key contributions to this
           report.

           Related GAO Products
			  
			  DOD Personnel Clearances: Questions and Answers for the Record
           Following the Second in a Series of Hearings on Fixing the
           Security Clearance Process. GAO-06-693R . Washington, D.C.: June
           14, 2006.

           DOD Personnel Clearances: New Concerns Slow Processing of
           Clearances for Industry Personnel. GAO-06-748T . Washington, D.C.:
           May 17, 2006.

           DOD Personnel Clearances: Funding Challenges and Other Impediments
           Slow Clearances for Industry Personnel. GAO-06-747T . Washington,
           D.C.: May 17, 2006.

           Managing Sensitive Information: DOE and DOD Could Improve Their
           Policies and Oversight. GAO-06-531T . Washington, D.C.: March 14,
           2006.

           GAO's High-Risk Program. GAO-06-497T . Washington, D.C.: March 15,
           2006.

           Managing Sensitive Information: Departments of Energy and Defense
           Policies and Oversight Could Be Improved. GAO-06-369 . Washington,
           D.C.: March 7, 2006.

           Questions for the Record Related to DOD's Personnel Security
           Clearance Program and the Government Plan for Improving the
           Clearance Process. GAO-06-323R . Washington, D.C.: January 17,
           2006.

           DOD Personnel Clearances: Government Plan Addresses Some
           Long-standing Problems with DOD's Program, But Concerns Remain.
           GAO-06-233T . Washington, D.C.: November 9, 2005.

           Defense Management: Better Review Needed of Program Protection
           Issues Associated with Manufacturing Presidential Helicopters.
           GAO-06-71SU . Washington, D.C.: November 4, 2005.

           Questions for the Record Related to DOD's Personnel Security
           Clearance Program. GAO-05-988R . Washington, D.C.: August 19,
           2005.

           Industrial Security: DOD Cannot Ensure Its Oversight of
           Contractors under Foreign Influence Is Sufficient. GAO-05-681 .
           Washington, D.C.: July 15, 2005.

           DOD Personnel Clearances: Some Progress Has Been Made but Hurdles
           Remain to Overcome the Challenges That Led to GAO's High-Risk
           Designation. GAO-05-842T . Washington, D.C.: June 28, 2005.

           Defense Management: Key Elements Needed to Successfully Transform
           DOD Business Operations. GAO-05-629T . Washington, D.C.: April 28,
           2005.

           Maritime Security: New Structures Have Improved Information
           Sharing, but Security Clearance Processing Requires Further
           Attention. GAO-05-394 . Washington, D.C.: April 15, 2005.

           DOD's High-Risk Areas: Successful Business Transformation Requires
           Sound Strategic Planning and Sustained Leadership. GAO-05-520T .
           Washington, D.C.: April 13, 2005.

           GAO's 2005 High-Risk Update. GAO-05-350T . Washington, D.C.:
           February 17, 2005.

           High-Risk Series: An Update. GAO-05-207 . Washington, D.C.:
           January 2005.

           Intelligence Reform: Human Capital Considerations Critical to 9/11
           Commission's Proposed Reforms. GAO-04-1084T . Washington, D.C.:
           September 14, 2004.

           DOD Personnel Clearances: Additional Steps Can Be Taken to Reduce
           Backlogs and Delays in Determining Security Clearance Eligibility
           for Industry Personnel. GAO-04-632 . Washington, D.C.: May 26,
           2004.

           DOD Personnel Clearances: Preliminary Observations Related to
           Backlogs and Delays in Determining Security Clearance Eligibility
           for Industry Personnel. GAO-04-202T . Washington, D.C.: May 6,
           2004.

           Security Clearances: FBI Has Enhanced Its Process for State and
           Local Law Enforcement Officials. GAO-04-596 . Washington, D.C.:
           April 30, 2004.

           Industrial Security: DOD Cannot Provide Adequate Assurances That
           Its Oversight Ensures the Protection of Classified Information.
           GAO-04-332 . Washington, D.C.: March 3, 2004.

           DOD Personnel Clearances: DOD Needs to Overcome Impediments to
           Eliminating Backlog and Determining Its Size. GAO-04-344 .
           Washington, D.C.: February 9, 2004.

           Aviation Security: Federal Air Marshal Service Is Addressing
           Challenges of Its Expanded Mission and Workforce, but Additional
           Actions Needed. GAO-04-242 . Washington, D.C.: November 19, 2003.

           Results-Oriented Cultures: Creating a Clear Linkage between
           Individual Performance and Organizational Success. GAO-03-488 .
           Washington, D.C.: March 14, 2003.

           Defense Acquisitions: Steps Needed to Ensure Interoperability of
           Systems That Process Intelligence Data. GAO-03-329 . Washington
           D.C.: March 31, 2003.

           Managing for Results: Agency Progress in Linking Performance Plans
           With Budgets and Financial Statements. GAO-02-236 . Washington
           D.C.: January 4, 2002.

           Central Intelligence Agency: Observations on GAO Access to
           Information on CIA Programs and Activities. GAO-01-975T .
           Washington, D.C.: July 18, 2001.

           Determining Performance and Accountability Challenges and High
           Risks. GAO-01-159SP . Washington, D.C.: November 2000.

           DOD Personnel: More Consistency Needed in Determining Eligibility
           for Top Secret Security Clearances. GAO-01-465 . Washington, D.C.:
           April 18, 2001.

           DOD Personnel: More Accurate Estimate of Overdue Security
           Clearance Reinvestigations Is Needed. GAO/T-NSIAD-00-246 .
           Washington, D.C.: September 20, 2000.

           DOD Personnel: More Actions Needed to Address Backlog of Security
           Clearance Reinvestigations. GAO/NSIAD-00-215 . Washington, D.C.:
           August 24, 2000.

           Security Protection: Standardization Issues Regarding Protection
           of Executive Branch Officials. GAO/T-GGD/OSI-00-177 . Washington,
           D.C.: July 27, 2000.

           Security Protection: Standardization Issues Regarding Protection
           of Executive Branch Officials. GAO/GGD/OSI-00-139 . Washington,
           D.C.: July 11, 2000.

           Computer Security: FAA Is Addressing Personnel Weaknesses, But
           Further Action Is Required. GAO/AIMD-00-169 . Washington, D.C.:
           May 31, 2000.

           DOD Personnel: Weaknesses in Security Investigation Program Are
           Being Addressed. GAO/T-NSIAD-00-148 . Washington, D.C.: April 6,
           2000.

           DOD Personnel: Inadequate Personnel Security Investigations Pose
           National Security Risks. GAO/T-NSIAD-00-65 . Washington, D.C.:
           February 16, 2000.

           DOD Personnel: Inadequate Personnel Security Investigations Pose
           National Security Risks. GAO/NSIAD-00-12 . Washington, D.C.:
           October 27, 1999.

           Background Investigations: Program Deficiencies May Lead DEA to
           Relinquish Its Authority to OPM. GAO/GGD-99-173 . Washington,
           D.C.: September 7, 1999.

           Department of Energy: Key Factors Underlying Security Problems at
           DOE Facilities. GAO/T-RCED-99-159 . Washington, D.C.: April 20,
           1999.

           Performance Budgeting: Initial Experiences Under the Results Act
           in Linking Plans With Budgets. GAO/AIMD/GGD-99-67 . Washington,
           D.C.: April 12, 1999.

           Military Recruiting: New Initiatives Could Improve Criminal
           History Screening. GAO/NSIAD-99-53 . Washington, D.C.: February
           23, 1999.

           Executive Office of the President: Procedures for Acquiring Access
           to and Safeguarding Intelligence Information. GAO/NSIAD-98-245 .
           Washington, D.C.: September 30, 1998.

           Inspectors General: Joint Investigation of Personnel Actions
           Regarding a Former Defense Employee. GAO/AIMD/OSI-97-81R .
           Washington, D.C.: July 10, 1997.

           Privatization of OPM's Investigations Service. GAO/GGD-96-97R .
           Washington, D.C.: August 22, 1996.

           Cost Analysis: Privatizing OPM Investigations. GAO/GGD-96-121R .
           Washington, D.C.: July 5, 1996.

           Personnel Security: Pass and Security Clearance Data for the
           Executive Office of the President. GAO/NSIAD-96-20 . Washington,
           D.C.: October 19, 1995.

           Privatizing OPM Investigations: Implementation Issues.
           GAO/T-GGD-95-186 . Washington, D.C.: June 15, 1995.

           Privatizing OPM Investigations: Perspectives on OPM's Role in
           Background Investigations. GAO/T-GGD-95-185 . Washington, D.C.:
           June 14, 1995.

           Security Clearances: Consideration of Sexual Orientation in the
           Clearance Process. GAO/NSIAD-95-21 . Washington, D.C.: March 24,
           1995.

           Background Investigations: Impediments to Consolidating
           Investigations and Adjudicative Functions. GAO/NSIAD-95-101 .
           Washington, D.C.: March 24, 1995.

           Managing DOE: Further Review Needed of Suspensions of Security
           Clearances for Minority Employees. GAO/RCED-95-15 . Washington,
           D.C.: December 8, 1994.

           Personnel Security Investigations. GAO/NSIAD-94-135R . Washington,
           D.C.: March 4, 1994.

           Classified Information: Costs of Protection Are Integrated With
           Other Security Costs. GAO/NSIAD-94-55 . Washington, D.C.: October
           20, 1993.

           Nuclear Security: DOE's Progress on Reducing Its Security
           Clearance Work Load. GAO/RCED-93-183 . Washington, D.C.: August
           12, 1993.

           Personnel Security: Efforts by DOD and DOE to Eliminate
           Duplicative Background Investigations. GAO/RCED-93-23 .
           Washington, D.C.: May 10, 1993.

           Administrative Due Process: Denials and Revocations of Security
           Clearances and Access to Special Programs. GAO/T-NSIAD-93-14 .
           Washington, D.C.: May 5, 1993.

           DOD Special Access Programs: Administrative Due Process Not
           Provided When Access Is Denied or Revoked. GAO/NSIAD-93-162 .
           Washington, D.C.: May 5, 1993.

           Security Clearances: Due Process for Denials and Revocations by
           Defense, Energy, and State. GAO/NSIAD-92-99 . Washington, D.C.:
           May 6, 1992.

           Due Process: Procedures for Unfavorable Suitability and Security
           Clearance Actions. GAO/NSIAD-90-97FS . Washington, D.C.: April 23,
           1990.

           Weaknesses in NRC's Security Clearance Program. GAO/T-RCED-89-14 .
           Washington, D.C.: March 15, 1989.

           Nuclear Regulation: NRC's Security Clearance Program Can Be
           Strengthened. GAO/RCED-89-41 . Washington, D.C.: December 20,
           1988.

           Nuclear Security: DOE Actions to Improve the Personnel Clearance
           Program. GAO/RCED-89-34 . Washington, D.C.: November 9, 1988.

           Nuclear Security: DOE Needs a More Accurate and Efficient Security
           Clearance Program. GAO/RCED-88-28 . Washington, D.C.: December 29,
           1987.

           National Security: DOD Clearance Reduction and Related Issues.
           GAO/NSIAD-87-170BR . Washington, D.C.: September 18, 1987.

           Oil Reserves: Proposed DOE Legislation for Firearm and Arrest
           Authority Has Merit. GAO/RCED-87-178 . Washington, D.C.: August
           11, 1987.

           Embassy Blueprints: Controlling Blueprints and Selecting
           Contractors for Construction Abroad. GAO/NSIAD-87-83 . Washington,
           D.C.: April 14, 1987.

           Security Clearance Reinvestigations of Employees Has Not Been
           Timely at the Department of Energy. GAO/T-RCED-87-14 . Washington,
           D.C.: April 9, 1987.

           Improvements Needed in the Government's Personnel Security
           Clearance Program. Washington, D.C.: April 16, 1985.

           Need for Central Adjudication Facility for Security Clearances for
           Navy Personnel. GAO/GGD-83-66 . Washington, D.C.: May 18, 1983.

           Effect of National Security Decision Directive 84, Safeguarding
           National Security Information. GAO/NSIAD-84-26 . Washington, D.C.:
           October 18, 1983.

           Faster Processing of DOD Personnel Security Clearances Could Avoid
           Millions in Losses. GAO/GGD-81-105 . Washington, D.C.: September
           15, 1981.

           Lack of Action on Proposals To Resolve Longstanding Problems in
           Investigations of Federal Employees. FPCD-79-92. Washington, D.C.:
           September 25, 1979.

           Costs of Federal Personnel Security Investigations Could and
           Should Be Cut. FPCD-79-79. Washington, D.C.: August 31, 1979.

           Proposals to Resolve Longstanding Problems in Investigations of
           Federal Employees. FPCD-77-64. Washington, D.C.: December 16,
           1977.

           Personnel Security Investigations: Inconsistent Standards and
           Procedures. B-132376. Washington, D.C.: December 2, 1974.

           GAOï¿½s Mission
			  
			  The Government Accountability Office, the audit, evaluation and
           investigative arm of Congress, exists to support Congress in
           meeting its constitutional responsibilities and to help improve
           the performance and accountability of the federal government for
           the American people. GAO examines the use of public funds;
           evaluates federal programs and policies; and provides analyses,
           recommendations, and other assistance to help Congress make
           informed oversight, policy, and funding decisions. GAO's
           commitment to good government is reflected in its core values of
           accountability, integrity, and reliability.

           Obtaining Copies of GAO Reports and Testimony
			  
			  The fastest and easiest way to obtain copies of GAO documents at
           no cost is through GAO's Web site ( www.gao.gov ). Each weekday,
           GAO posts newly released reports, testimony, and correspondence on
           its Web site. To have GAO e-mail you a list of newly posted
           products every afternoon, go to www.gao.gov and select "Subscribe
           to Updates."

           Order by Mail or Phone
			  
			  The first copy of each printed report is free. Additional copies
           are $2 each. A check or money order should be made out to the
           Superintendent of Documents. GAO also accepts VISA and Mastercard.
           Orders for 100 or more copies mailed to a single address are
           discounted 25 percent. Orders should be sent to:

           U.S. Government Accountability Office 441 G Street NW, Room LM
           Washington, D.C. 20548

           To order by Phone: Voice: (202) 512-6000 TDD: (202) 512-2537 Fax:
           (202) 512-6061

           To Report Fraud, Waste, and Abuse in Federal Programs
			  
			  Contact:

           Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail:
           [email protected] Automated answering system: (800) 424-5454 or
           (202) 512-7470

           Congressional Relations
			  
			  Gloria Jarmon, Managing Director, [email protected] (202) 512-4400
           U.S. Government Accountability Office, 441 G Street NW, Room 7125
           Washington, D.C. 20548

           Public Affairs
			  
			  Paul Anderson, Managing Director, [email protected] (202)
           512-4800 U.S. Government Accountability Office, 441 G Street NW,
           Room 7149 Washington, D.C. 20548

34 Investigative scope defines the time period for which investigators are
required to examine aspects of a subject's background in each
investigative area. For example, in initial investigations, investigators
are required to obtain information about all jobs of 6 months or more that
took place within the 7 years prior to the date the investigation was
scheduled. While this is the minimum requirement, instructions provided in
OPM's training for new investigators encouraged coverage of all employment
during the period of interest, noting that shorter terms of employment
would probably reveal more issues.

35 According to OPM's Investigator's Handbook and subsequent
clarifications, two source interviews are required for each activity
listed on a subject's clearance application. Activities include the
subject's employment, education, and residence.

36 Mitigation factors were also missing for these 22 guidelines since an
adjudicator would not mitigate an issue if the applicable adjudicative
guideline had not been documented in JPAS. We found four other instances
where a guideline was reported in JPAS, but the mitigating factor was not
indicated.

37 The Adjudicative Desk Reference identifies the logic of a particular
security concern for each of the 13 federal adjudicative guidelines,
examples of conditions that raise a security concern, and examples of
conditions that could mitigate security concerns. DOD's Decision Logic
Table is from the Defense Security Service's 20-1-M (April 2003) and
contains guidance concerning investigation expansion for each adjudicative
guideline. Each section of the table presents one of the 13 adjudicative
guidelines and discusses the concern, the potential disqualifying
condition, and the mitigating factors that pertain to each guideline. To
identify instances of missing documentation in an adjudicative report, we
compared information in the investigative reports to security concerns
specified in these two source documents.

38 This committee is led by OMB's Deputy Director for Management and is
comprised of representatives from DOD, Homeland Security, Energy, Justice,
Transportation, Commerce, State, the Director of National Intelligence,
the National Security Council, and the National Archives and Records
Administration.

(350734)

*** End of document. ***