HEARINGS RELATING TO H.R. 10175, TO ACCOM-
PANY H.R. 11363, AMENDING THE INTERNAL
SECURITY ACT OF 1950
COMMITTEE ON UN-AMERICAN ACTIVITIES
HOUSE OE REPRESENTATIVES
MARCH 15, 1962
Printed for the use of the
Committee on Un-American Activities
U S. (iOVERNMENT PRINTING OFFICE
WASHINGTON : 1962
NAKVAfM) eOlLRL LIBRAR"
DEPOSITED BY TBE
UWTEO STATBb aoVERNMEM^
MAV IH ]:i V. f
COMMITTEE OX UN-AMERICAN ACTIVITIES
United States Hoxjse of Representatives
FRANCIS E. WALTER, Pennsylvania, Chairman
MORGAN M. MOULDER, Missouri GORDON H. SCHERER, Ohio
CLYDE DOYLE, California AUGUST E. JOHANSEN, Michigan
EDWIN E. WILLIS, Louisiana DONALD C. BRUCE, Indiana
WILLIAM M. TUCK, Virginia HENRY C. SCIIADEBERG, Wisconsin
Frank S. Tavenner, Jr., Director
Alfred M. Nittle, Counsd
John C. Walsh, Co-counsel
QWENN Lewis, Administrative Assistant
March 15, 1962, Statement of :
Walter T. Skallerup, Jr 458
Frank A. Bartimo 458
George MacClain 458
Herbert Lewis 458
Afternoon Session :
Walter T. Skallerup, Jr. (resumed) 488
Frank A. Bartimo (resumed) 488
George MacClain (resumed) 488
Herbert Lewis (resumed) 488
J. Walter Yeagley 504
John F. Doherty 504
Kevin T. Maroney 504
H.R. 10175 453
H.R. 11363 IX
Executive Order 10865 519
Executive Order 10909 523
Department of Defense Directive No. 5220.6 (Industrial Personnel
Access Authorization Review Regulation) 525
Public Law 601, 79th Congress
The legislation under which the House Committee on Un-American
Activities operates is Public Law 601, 79th Congress  ; 60 Stat.
812, which provides:
Be it enacted hy the Senate and House of Representatives of the United States
of America in Congress assembled, * * ♦
PART 2— RULES OF THE HOUSE OF REPRESENTATIVES
SEC. 121. STANDING COMMITTEES
17. Committee on Un-American Activities, to consist of nine Members.
POWERS AND DUTIES OF COMMITTESIS
( q ) ( 1 ) Committee on Un-American Activities.
(A) Un-American activities.
(2) The Committee on Un-American Activities, as a whole or by subcommit-
tee, is authorized to make from time to time investigations of (i) the extent,
character, and objects of un-American propaganda activities in the United States,
(ii) the diffusion within the United States of subversive and un-American propa-
ganda that is instigated from foreign countries or of a domestic origin and attacks
the principle of the form of government as guaranteed by our Constitution, and
(iii) all other questions in relation thei-eto that would aid Congress in any
necessary remedial legislation.
The Committee on Un-American Activities shall report to the House (or to the
Clerk of the House if the House is not in session) the results of any such investi-
gation, together with such recommendations as it deems advisable.
For the purpose of any such investigation, the Committee on Un-American
Activities, or any subcommittee thereof, is authorized to sit and act at such
times and places within the United States, whether or not the House is sitting,
lias recessed, or has adjourned, to hold such hearings, to require the attendance
of such witnesses and the production of such books, papers, and documents, and
to take such testimony, as it deems necessary. Subpenas may be issued under
the signature of the chairman of the committee or any subcommittee, or by any
member designated by any such chairman, and may be served by any person
designated by such chairman or member.
LEGISLATIVE OVERSIGHT BY STANDING COMMITTEES
Sec. 136. To assist the Congress in apprai-sing the administration of the laws
and in developing such amendments or related legislation as it may deem neces-
sary, each standing committee of the Senate and the House of Representatives
shall exercise continuous watchfulness of the execution by the administrative
agencies concerned of any laws, the subject matter of which is within the juris-
diction of such committee ; and, for that purpose, shall study all pertinent reports
and data submitted to the Congress by the agencies in the executive branch of
RULES ADOPTED BY THE 87TH CONGRESS
House Resolution 8, January 3, 1961
4t m * * * * •
1. There shall be elected by the House, at the commencement of each Congress
4: * * * * * *
(r) Committee on Un-American Activities, to consist of nine Members.
m ***** *
POWERS AND DUTIES OF COMMITTEES
* * * * * * *
18. Committee on Un-American Activities.
(a) Un-Amei'ican activities.
(b) The Committee on Un-American Activities, as a whole or by subcommittee,
is authorized to make from time to time investigations of (1) the extent, char-
acter, and objects of un-American propaganda activities in the United States,
(2) the diffusion within the United States of subversive and un-American proi>
aganda that is instigated from foreign countries or of a domestic origin and
attacks the principle of the form of government as guaranteed by our Constitu-
tion, and (3) all other questions in relation thereto that would aid Congress in
any necessary remedial legislation.
The Committee on Un-American Activities shall report to the House (or to the
Clerk of the House if the House is not in session) the results of any such investi-
gation, together with such recommendations as it deems advisable.
For the purpose of any such investigation, the Conmiittee on Un-American
Activities, or any subcommittee thereof, is authorized to sit and act at such times
and places within the United States, whether or not the House is sitting, has
recessed, or has adjourned, to hold such hearing.s, to require the attendance
of such witnesses and the production of such books, papers, and documents, and
to take such testimony, as it deems necessary. Subpenas may be issued under
the signature of the chairman of the committee or any .subcommittee, or by any
member designated by any such chairman, and may be served by any person
designated by any such chaii'man or member.
27. To assist the House in appraising the administration of the laws and in
developing such amendments or related legislation as it may deem necessary,
each standing committet^ of the House shall exercise continuous watchfulness
of the execution by tlie administrative agencies concerned of any laws, the subject
matter of which is within the jurisdiction of such committee ; and, for that pur-
pose, shall study all pertinent reports and data submitted to the House by the
agencies in the executive branch of the Government.
At the hearings of March 15, 19G2, on H.R. 10175, which are fully
recorded herein, the views of the interested Departments of Govern-
ment were received. The Departments ap]:)eared to be unanimous in
their approval of the purposes of the bill, but as will be noted in the
record certain modifications and revisions were sng-gested.
As a result of the views presented by the Departments of Defense
and Justice, it was the thought of the committee that a bill be
introduced which would incorporate those revisions requested by the
Departments as modi lied or supplemented by our own thinking. Con-
sequently, I introduced H.R. 11368 on April 17, 1962, and on the
following dav ^Nlr. Scherer, in snp]iort of this proposal, introduced
an identical bill, H.R. 11414.
The hearings on H.R. 10175 are therefore directly related to the
bills above mentioned, which w^ere subsequently introduced, and
form the base for consideratiou and miderstanding of them. The
Departments of Defense and Justice have now been asked to express
their final views with respect to H.R. 11363 and its companion bill,
H.R. 11414. Upon receipt of comments by the Departments relating
to this new version it is exi)ected that sliortly thereafter the com-
mittee will make its rej^ort to the House.
A copy of H.R. 11363 follows.
Francis E. Walter,
Chairman^ Cotnmittee on Un-American Activities.
April 19, 1962.
IN THE HOUSE OF REPRESENTATIVES
April 17, 1962
Mr. Walter introduced the following bill ; which was referred to the Com-
mittee on Un-American Activities
To amend the Internal Security Act of 1950 to provide for the
protection of chxssified information released to or within United
States industry, and for other purposes.
Be it enacted hy the Senate and House of Representatives of
the United States of America in Congress assembled^ That the In-
ternal Security Act of 1950 is amended by adding at the end thereof
the following new title :
"TITLE III— INDUSTKIAL SECURITY PROGRAM
"Sec. 301. Under such regulations as the President may prescribe,
the Secretary of Defense may prescribe such uniform regulations,
standards, restrictions, and other safeguards as he considers necessary
to protect classified information released to or within any industrial,
educational, or research organization, institution, enterprise, or other
legal entity, located in the United States, whether or not operated
for profit (hereafter in this title referred to as 'United States in-
dustry'), including procedures for determining eligibility for
authorizations for access to classified information so released. The
standard for determining eligibility for authorization for access to
classified information pursuant to this title shall be that the granting
or continuing of access authorization is clearly consistent with the
"personal appearance procedures
"Sec. 302. Except in cases where the Secretary personally deter-
mines that such procedures cannot be employed consistently with the
national security, in which event the Secretary will personally make
the determination to deny or revoke access authorization, an author-
ization for access to classified information by an individual (here-
after in this title referred to as 'applicant'), employed in United
States industry whose employment involves access to classified in-
formation may not be finally denied or revoked unless the applicant
has been given —
"(1) a written statement of reasons for the denial or revoca-
tion stated as comprehensively and detailed as the national
security will permit ;
X HEARINGS RELATING TO H.R. 10175
"(2) an opportunity, after he has replied in writing within
a reasonable time under oath or affirmation in specific detail
to the statement of reasons, for a personal appearance proceed-
ing at which time he may present evidence in his own behalf:
"(3) a reasonable time to prepare for the proceeding;
"(4) the opportunity to be represented by counsel; and
"(5) a written notice advising him of final action which, if
adverse, shall specify whether the Secretary has found for or
against him with respect to each allegation in the statement of
With respect to matters, other than those relating to the characteriza-
tion in the statement of reasons of any organization or individual
other than the applicant, which he controverts in his reply, the appli-
cant shall be given an opportunity to inspect any documentary evi-
dence or cross-examine either orally or through written interrogatories
any witness providing adverse information upon whicli the Secretary
may rely in reaching a final determination to deny or revoke the au-
thorization for access to classified information. However, documen-
tary evidence which has been classified, and information supplied by
informants may be received and considered without an opportunity for
inspection or cross-examination if the applicant is given a summary
of such evidence or information which is as comprehensive and de-
tailed as the national security will permit and, in the case of informa-
tion supplied by an informant, the informant is one —
''(1) who is identified but who cannot be brought forward
because of death, serious illness, or for similar cause ; or
"(2) who cannot, for reasons determined by the Secretary to
be good and sufficient, be either identified or cross-examined; or
"(3) whose identity cannot be revealed, in the judgment of the
head of the Department supplying such iriformant, without sub-
stantial harm to the national interest.
Nothing contained in this title shall be deemed to support a demand
by an applicant to inspect or have access to the investigati\e reports
of any agency of the Government.
'Sec. 303. Under such regulations as the Secretary may prescribe,
the Secretary (or his designee for such purpose) shall ha\e power to
issue, and in his discretion for good cause shown, shall issue, process
to compel witnesses to appear and testify or produce evidence in a
personal appearance proceeding under section 302. Any process so
issued may run to any ])art of the Ignited States and its' possessions,
including the District of Columbia and the Commonwealth of Puerto
Rico. Any person who willfully neglects or refuses to appear, or re-
fuses to qualify as a witness, or to testify or produce evidence in
obedience to any process duly issued under this section, shall be fined
not more than $500, or imprisoned not more than six months, or both.
Upon certificiition by the Secretary, concerning any such neglect,
refusal, or failure by any person, to the Ignited States attorney for
any judicial district in which such person resides or is found, the
United States attorney shall proceed by information for the prosex^u-
tion of such person. The Secretary (oi- his designee for such pur-
HEARINGS RELATING TO H.R. 10175 XI
pose), upon good cause shown, may (1) authorize any party to a per-
sonal appearance proceeding under section 302 to obtain the testimony
of any person by deposition upon oral examination or by written
interrogations, and (2) appoint any person to obtain such testimany.
Any person so appointed shall have the power to administer oaths.
"fees and expenses for taking evtdence
"Sec. 304. The fees and expenses of witnesses subpenaed or called
by or on behalf of the applicant shall be borne by the applicant,
excepting that the Secretary may, in accordance wdth such regula-
tions as he shall prescribe, provide that such fees and expenses shall,
under certain equitable circumstances and in the interests of justice,
be borne in whole or in part by the United States. Witnesses sum-
moned or called to testify or produce evidence at a personal appear-
ance proceeding are authorized travel expenses and per diem in such
amounts as provided by the Standardized Government Travel Regula-
tions or the Joint Travel Regulations, as appropriate. A witness
whose deposition is taken, and the person taking his deposition, is
entitled to the same fees that are paid for like services in the courts
of the United States. Any appropriation otherwise available to
the agency concerned for procurement shall be available for such
"reimbursement for loss of certain earnings
"Sec. 305. The Secretary may, in accordance with such regula-
tions as he may prescribe, provide for the reimbursement of all or
any part of a net loss of earnings resulting directly from the sus-
pension, denial, or revocation of an authorization for access to
classified information of an applicant, who, at the time of such
suspension, denial, or revocation, was employed in United States
industry if, at a later time, it has been determined by the Secretary
that (1) the applicant is eligible for an access authorization equiv-
alent to that which was suspended, denied, or revoked, and (2)
after considering all of the facts and circumstances under which
the suspension, denial, or revocation occurred, it is fair and equitable
that the United States, rather than the applicant, bear the loss for
which reimbursement is to be made. Reimbursement may not ex-
ceed the difference between the amount the applicant would have
earned as an employee of the same employer had he continued in
the same position as that held at the time of suspension, denial, or
revocation and his interim earnings during the period commencing
on the date of suspension, denial, or revocation and ending with
the date of giving notice to the applicant by regular first-class mail
addressed to his last known address of his eligibility for access au-
thorization. The authority conferred by this section may be exer-
cised whether the suspension, denial, or revocation of access
authorization directly causing the loss of earnings, or the subsequent
determination of eligibility, occurred before or after the date of
enactment of this title. Any appropriation othei-wise available to
the agency concerned for procurement shall be available for such
Xn HEARINGS RELATING TO H.R. 10175
"extension of program by agreement
"Sec. 306. By agreement between the Department of Defense and
any other department or agency of the United States, reguhitions
prescribed by the Secretary of Defense under this title may be ex-
tended to apply to releases to or within United States industry of clas-
sified information which the other department or agency has the
responsibility for safeguarding. In such cases, however, any reim-
bursement authorized by section 305 of this title shall be made by the
department or agency concerned.
"nONAPPLICATION of ADMINISTRATrVTE PROCEDURE ACT
"Sec. 307. The Administrative Procedure Act, as amended (5
U.S.C. 1001 et seq.) shall not apply to the use or exercise of any author-
ity granted by this title.
"DEFINmON OF CLASSIFIED INFORMATION
"Sec. 308. For the purposes of this title the term 'classified informa-
tion' means information which, for reasons of national security, is
siDecifically designated by a United States Government agency for
limited or restricted dissemination or distribution."
HEARINGS RELATING TO H.R. 10175, TO ACCOMPANY
H.R. 11363, AMENDING THE INTERNAL SECURITY
ACT OF 1950
THURSDAY, MARCH 15, 1962
United States House of Representatives,
Committee on Un-American Activities,
The Committee on Un-American Activities met, pursuant to call,
at 10 :15 a.m., in Room 445 of the House Office Building, Washington,
D.C., Hon. Francis E. Walter (chairman of the committee) presiding.
Committee members present : Representatives Francis E. Walter, of
Pennsylvania; Clyde Doyle, of California; William M. Tuck, of
Virginia ; Gordon H. Scherer, of Ohio; August E. Johansen, of Michi-
gan ; and Henry C. Schadeberg, of Wisconsin.
Staff members present: Frank S. Tavenner, Jr., director; Alfred
M. Xittle, counsel ; John C. Walsh, co-counsel ; and George H. Lynch,
The Chairman. I apologize for being late. I was detained this
morning, trying to get the immigration bill out of committee.
We meet today for the consideration of H.R. 10175. The purpose
of this bill is to create a legislative base authorizing the Secretary of
Defense to establish a security program with respect to defense con-
tractors and their employees, and to prescribe procedures to be fol-
lowed in evaluating industrial security cases, so that the preservation
and integrity of classified information may be assured.
That a program of this nature is undoubtedly necessary would
seem to be self-evident. Our defense efforts have long been the target
of planned espionage and sabotage. In numerous hearings over the
years, this committee has established that the Communist Party of
the United States has, for purposes of sabotage and espionage, delib-
erately infiltrated basic industry which is involved in defense produc-
tion of highly classified projects of the military establishments.
For example, Mr. John Lautner, who held high Communist Party
office on the national level and was an active Communist Party mem-
ber for more than 20 years prior to his expulsion from the party in
1950, testified that, as far back as 1932, the Communist Party em-
barked upon a program called "Face to the Shop," which was designed
to infiltrate and colonize basic industry with Communists.
He traced the development of that program and testified that in
1948 the organizational director of the Communist Party, in a secret
report, was able to boast that over 3,000 Communist Party branches
throughout the country and between 400 and 500 industrial branches
452 HEARINGS RELATING TO H.R. 10175
had been established. (See: "Investigation of Communist Infiltra-
tion and Propaganda Activities in Basic Industry, Gary, Ind., Area,"
hearin^rs held February 10 and 11. 1958.) It may be taken as factual
that the Communists have succeeded in serious degree in accomplish-
ing their planned infiltration of basic industry. (See also: "Prob-
lems of Security in Industrial Establishments Holding Defense Con-
tracts, Greater ^Pittsburgh Area, Part 2," hearings held March 11,
More recently the investigations of this committee into the IS^ational
Security Agency, arising out of the defection of William H. Martin
and Bei-non F. ^litchell to the Soviet Union July 1960, have pointed
up additional security problems of a general nature and other than
those related directl;7 to disloyalty, including such considerations as
perversion, personality and character defects, and habits that render
individuals untrustworthy and unreliable as repositories of classified
information or State secrets.
The general necessity for a security program cannot be disputed.
Moreover, the legal necessity for specific congressional action to au-
thorize such a program on a firm basis is suggested. This committee
has repeatedly and urgently recommended a legislative program of
this type. Although the Executive Branch of the Government has
been aware of the serious danger to national security by reason of
Communist infiltration of industry holding defense contracts, as well
as other security problems above indicated, the industrial clearance
or security program which had been for several years established in
the Defense Department under regulations of the Secretary of the
Defense, was struck down by the recent decision of the Supreme
Court in the case of Greene v. McElroy, 360 U.S. 474, decided June 29,
1'959. The regulations of the Secretary of Defense then in effect, and
which provided for a personnel security clearance program granting
fair but limited hearings to persons denied access to classified informa-
tion, were held invalid by the Supreme Court.
The Supreme Court declared that such regulations issued under the
authority of the Secretary of Defense had not sufficient authorization
and that "it must be made clear that the President or Congress, within
their respective constitutional powers, specifically has decided that the
imposed procedures are necessary and warranted and has authorized
The Chief Justice went further and declared, at page 508 :
Whether those procedures under the circumstances comport with the Constitu-
tion we do not decide. Nor do we decide whether the President has inherent
authority to create such a program, whether congressional action is necessary,
or what the limits on executive or legislative authority may be. We decide only
that in the absence of explicit authorization from either the President or Congress
the respondents were not empowered to deprive petitioner of his job in a proceed-
ing in which he was not afforded the safeguards of confrontation and cross-
Perhaps I should point out that innnediately after this decision in
the Greene case, I introduced on July 7, 1959, JEI.R. 8121, with a view
toward establishing congressional authority for the issuance by the
Secretary of Defense of such regulations. That bill was reported out
by this committee on September 2, 1959, passed by the House on
February 2, 1960, and referred to the Senate, which took no final
action. Further, the President on February 20, 1960, issued Execu-
HEARINGS RELATING TO H.R. 10175 453
tive Order No. 10865, g:ivino; authority to certain departments, includ-
ing the Department of Defense, to issue reguhitions and prescribe
requirements for the safeguarding of chissified information within
industry. The necessity for such reguhitions was thus clearly and
explicitly recognized by the President.
However, congressional action likewise seems desirable in order to
clarify any ambiguity as to the necessity for congressional action posed
in the foregoing language of Chief Justice Warren which I have
quoted. With these thoughts in mind, we now proceed to a considera-
tion of the bill, H.ll. 10175, and the views of the Executive depart-
ments in relation thereto.
(H.R. 10175 follows:)
[H.R. 10175, 87th Cong., 2d sess]
A BILL To amend the Subversive Activities Control Act of 1950 to provide for a security
program with respect to defense contractors and their employees
Be it enacted by the Senate and House of Representatives of the United States
of America in Congress assembled, That the Subversive Activities Control Act
of 1950 (64 Stat. 987) is amended by inserting immediately after section 5 the
following new section :
"INDUSTEIAL PERSONNEL SECUKITY REVIEW
"Sec. 5A. (a) The Secretary of Defense (hereafter in this section referred to
as the 'Secretai-y') is authorized, in connection with the performance of any
contract with a military department involving classified information, to pre-
scribe such requirements, restrictions, and safeguards, with respect to access to
such information, as he may deem necessary in the interest of national security.
"(b) In any case in which access to classified information by (1) any i^erson
who has a contract referred to in subsection (a) of this section, (2) any person
who has a subcontract of any such contract, or (3) any employee of any such
person, is denied, suspended, or revoked under the regulations referred to in
such subsection (a), the Secretary shall provide for a personal appearance
proceeding at which the person aggrieved by the denial, suspension, or revocation
of his access to classified information shall be permitted to present evidence
in his behalf and at which the United States shall produce those persons who
furnished information forming the basis of any such denial, suspension, or revo-
cation, to the extent that the Secretary, and the head of the investigative agency
(if any) which supplied the information, shall determine to be permissible in
the interest of national security.
"(c) Under such regulations as the Secretary may prescribe, the Secretary
(or his designee for such purpose) shall have the power to issue process to
compel witnesses to appear and testify or produce evidence in a personal appear-
ance proceeding under subsection (b) of this section. Any process so issued may
run to any part of the United States and its possessions, including the District
of Columbia and the Commonwealth of Puerto Rico. Any person who willfully
neglects or refuses to appear, or refuses to qualify as a witness, or to testify or
produce evidence in obedience to any process duly issued under this subsection,
shall be fined not more than .$.jOO, or imprisoned not more than six months, or
both. Upon certification by the Secretary, concerning any such neglect, refusal,
or failure by any person, to the United States attorney for any judicial district
in which such person resides or is found, the United States attorney shall
proceed by information for the prosecution of such person. The Secretary (or
his designee for such purpose) may (1) authorize any party to a personal
appearance proceeding under subsection (b) of this section to obtain the testi-
mony of any person by deposition upon oral examination or by written interroga-
tions, and (2) appoint any person to obtain such testimony. Any person so
appointed shall have the power to administer oaths.
"(d) Witnesses summoned to a personal appearance proceeding under sub-
section (b) of this section shall be paid the same fees and mileage that are paid
witnesses in the courts of the United States, and witnesses whose depositions
are taken, and the person taking their deposition, shall be entitled to the same
fees as are paid for like services in the courts of the United States.
454 HEARINGS RELATING TO H.R. 10175
"(e) I'nder such rejjulations as the Secretary may pi-escribe, any individual
referred to in clause (3) of subsection (b) of this section may be reimbursed
for any loss of earnings directly resulting from a denial, suspension, or revoca-
tion of his access to classified information, if the Secrot.iry. or his designee,
determines that such denial, suspension, or revocation was unjustified and that
under all the circumstances reimbursement would be just and equitable. Reim-
bursement may be made for all or part of the period of such denial, suspension,
or revocation, in an amount not more than the difference between the amount
such individual would have earned as an employee of the contractor or subcon-
tractor concerned at the rate he was receiving on the dav of such denial, sus-
pension, or revocation, and the amount of his interim earningrs.
"(f) For the purposes of this section the term 'classified information' means
information which, for reasons of national security, is specifically designated by
a United States Government agency for limited or restricted dissemination or
The Chairman. Mr. Tavenner, will you call your witness?
Mr. Tavenner. Mr. Chairman, I think possibly first we should in-
troduce a letter from the Department of Defense, dated March 14,
1962, which is in reply to your request for the views of the Depart-
ment, together with the enclosed copy of a proposed substitute bill. _
The Chairman. That will be made a part of the record at this
(The documents referred to follow :)
General Counsel of the Department of Defense,
Washington, D.C., March H, 1962.
Dear Mr. Chairman :
You requested the Department of Defense to comment upon H.R. 10175, 87t.h
Congress, a bill "To amend the Subversive Activities Control Act of 1950 to pro-
vide for a security program with respect to defense contractors and their em-
In view of the action of the President in Executive Order 10865, the proposed
legislation is not considered necessary. However, if the Congress considers that
this legislation is desirable, the Department of Defense would have no objec-
tion to its enactment.
H.R. 10175 would amend the Subversive Activities Control Act of 1950, as
amended (50 U.S.C. 781 et sen.), by inserting immediately after section 5 thereof
a new section 5A, entitled "Industrial Personnel Security Review". It would
provide legislative authority for the Secretary of Defense to prescribe appro-
priate safeguards for the protection of classified informntion in the hands of
any contractor, subcontractor, or employee of any contractor or subcontractor,
in connection with the performance of any contract wifh a military department.
It would provide a legislative basis whereby an individual whose access authori-
zation had been suspended, denied or revoked would be entitled to a personal
appearance proceeding at which, subject to certain limitations, he would be af-
forfled opportunity for cross-examination of persons who had furnished adverse
information against him : it would provide the Secretary of Defense with author-
ity to subpoena and to obtain testimony by oral deposition or written interroga-
tories; it would provide for the payment of certain fees to witnesses; and it
iVould provide authority for reimbursement under certain circumstances for
loss of earnings directly resulting from a denial, suspension, or revocation of an
authorization for access to classified information.
We appreciate the effort of the Congress to strengthen our security program
and we are in accord with the purposes of H.R. 10175 and its principles. It is
believed, however, that certain modifications should be made in the bill in the
light of experience gained in the operation of the program and Executive Order
10865, February 20, 1960 as amended by Executive Order 10909. January 17, 1961.
Knowing the desire of the Committee tf) enact legislation which will assure
the continuance of a strong industrial security program, there is submitted for
consideration a revised draft of legislation which reflects the views of the
Department of Defense.
This redraft is designed to extend the scope of the bill to cover Defense De-
partment relations with industry, erlucational and research organizations and
other activities; and to provide express legislative authorization by the Congress
HEARINGS RELATING TO H.R. 10175 455
concerning the policies and procedures to be followed in evaluating and adjudi-
cating individual industrial security cases.
The enclosed proposed substitute bill would make the following major
modifications to H.R. 1017"):
a. It would amend the Internal Security Act of 1050 by adding a new Title,
entitled •'Industrial Security Program", rather than amend the Suhver.sive Ac-
tivities Ccintrol Act of 10.10. The Committee is aware that it is necessary to
protect classified information from willful and inadvertent disclosure resulting
from activities of those persons who are not motivated by sul)version. It is
necessary also to guard against persons who may be susceptible to persuasion,
coercion, pressure or blackmail because of character weaknesses or unfavorable
past associations and activities. Consequently, inasmuch as the industrial
security pro?j:ram covers more than the area of subversive activities, we believe
the proposed legislation should reflect this breadth of scope.
b. Although both H.R. 10175 and the enclosed redraft are directed in major
portion to the policies and procedures governing adjudication of applicant
cases, we believe that this draft bill should provide express Congressional au-
thority for all phases of an industrial security program, including the receipt,
handling, use, dissemination, storage, transmission, protection and destruction
of classified information, and not he limited solely to adjudication of applicant
c. The revised draft of the bill would cover not only situations where a con-
tract involving classified information exists but several other areas where classi-
fied information is released to non-governmental activities. This proposal is
designed to cover in broad terms both pre-contract and post-contract activities,
as well as performance; special situations in the field of research and develop-
ment; and relations with educational and research organizations and non-profit
groups and organizations.
d. The revised draft of the bill w^ould also permit the Department of Defense
to continue its program of protecting foreign classified information entrusted
to the United States and released to United States industry in furtherance
of international defense efforts. This includes the excliange of classified in-
formation under NATO and various bilateral agreements between the United
States and other countries.
e. The draft bill sets forth Congressional approval for policies under which
opportunities for cross-examination of witnesses are now afforded. Of prin-
cipal importance are the specific provisions for receipt and consideration of
information provided by informants who cannot, for stated reasons, be brought
forward for cross-examination and the exact circumstances under which oppor-
tunities for cross-examination may be denied. In this report, it is important
to note the following language of the Supreme Court in the case of Greene v.
McElroy (360 U.S.C. 474, (1959)) : "Before we are asked to judge whether, in
the context of security clearance cases, a person may be deprived of the right
to follow his chosen profession without full hearings where accusers may be
confronted, it must be made clear that the President or Congress, within their
constitutional powers specifically have decided that the imposed procedures are
necessary and warranted and have authorized their use."
f. The Committee will note that the proposed draft bill does not contain
a grant of subpoena authority to the Secretary of Defense for use in connection
with the industrial security program. Experience gained under Executive Order
10865, as amended, has demonstrated that with the necessary amount of effort,
expenditure of time, together with the splendid cooperation on the part of
other Government agencies, we have been able to obtain the necessary witnesses
and evidence in order to support all but an extremely small minority of cases.
Accordingly, we do not now seek such subpoena authority but should future
experience demonstrate that our need for it is greater than we now think, we
will so advise the Committee.
g. The changes contained in the revised draft bill concerning reimbursement
for lost earnings are intended to establish firmly that reimbursement under the
Industrial Security Program is a matter resting solely in the discretion of the
Secretary and is not a legal right of the applicant.
h. By agreement between the Secretary of Defense and the heads of certain
departments and agencies, arrangements have been made to apply the Depart-
ment of Defense Industrial Security Program to operations of the National
Aeronautics and Space Administration, the Federal Aviation Agency, the Gen-
456 HEARINGS RELATING TO H.R. 10175
eral Services Administration, the Department of State and the Department of
Commerce. A new section has been included in the draft bill to provide Con-
gressional approval for the continuance of this activity and for extension to
cover other agencies.
The Bureau of the Budget advises that, from the standpoint of the Admin-
istration's program, there is no objection to the presentation of this report for
the consideration of the Committee.
(Signed) Cyrus R. Vance.
Inclosure : Draft bill.
Honorable Francis E. Walter,
Chairman, Committee on Un-American Activities,
House of Representatives.
PROPOSED SUBSTITUTE BILL
A BILL To amend the Internal Security Act of 1950 to provide for the protection of
classified information released to or within United States industry and for other
Be it enacted by the Senate and House of Representatives of the United States
of America in Congress assembled. That the Internal Sectirity Act of 19.50 (50
U.S.C. 781 et seq. ) is amended by adding at tlie end thereof the following new
"TITLE III— INDUSTRIAL SECURITY PROGRAM
"Sec. 301. Under such regulations as the President may prescribe, the Secre-
tary of Defen.se may prescribe sucli uniform regulations, standards, restric-
tions, and other safeguards as he considers necessary to protect classified infor-
mation released to or within any industrial, educational, or research organiza-
tion, institution, enterprise, or other legal entity, located in the United States,
whether or not operated for profit (hereinafter referred to as "I'nited States
industry"), including procedures for determining eligibility for authorizations
for access to classified information so released.
' "Sec. 302. Except in cases where the Secretary personally determines that
such procedures cannot be employed consistently with the national security,
in which event the Secretary will personally make the determination to deny or
revoke access authorization, an authorization for access to classified informa-
tion by an individual (hereinafter referred to as "applicant"), employed in
United States industry whose employment involves access to classified informa-
tion may not be finally denied or revoked unless the applicant has been given —
"(1) a written statement of reasons for the denial or revocation stated as
comprehensively and detailed as the national security will permit;
"(2) an opportunity, after he has replied in writing within a reasonable
time under oath or affirmation in specific detail to the statement of reasons,
for a personal appearance proceeding at which time he may present evidence
in his own behalf;
"(3) a reasonable time to prepare for the proceeding;
"(4) the opportunity to be represented by counsel; and
"(5) a written notice by or in behalf of the Secretary advising him of
final action which, if adverse, shall specify whether the Secretary has found
for or against him with respect to each allegation in the statement of reasons.
With respect to matters not relating to the characterization in the statement of
reasons of any organization or individual other than the applicant, and which
he controverts in his reply, the applicant shall be given an opportunity to inspect
any documentary evidence or cross examine either orally or through written
interrogatories any witness providing adver.se information upon which the
Secretary niiiy rely in renching a final determination to deny or revoke the au-
thorization for access to classified informntion. However, documentary evidence
which lins been classified, and information supplied by informants may be re-
ceived and considered without an opportunity for inspection or cross examination
if the applicant is given a summary of such evidence or information which is as
comprehensive and detailed as the national security will permit and, in the case
of information supplied by an informant, the informant is one —
HEARINGS RELATING TO H.R. 10175 457
"(1) who is identified but who cannot be brought forward because of
death, serious illness, or for similar cause ; or
"(2) who cannot, for reasons determined by the Secretary to be good and
sufficient, be either identified or cross examined ; or
"(3) whose identity cannot be revealed, in the judgment of the head of
the investigative agency supplying such informant, without substantial harm
to the national interest.
However, the applicant may not inspect or have access to the investigative
reports of any agency of the Government. The Administrative Procedure Act,
as amended (5 U.S.C. 1001 et seq.), does not apply to personal appearance pro-
ceedings conducted under regulations prescribed under this Title.
"Sec. 303. Whenever a person is called at the request of the Secretary to testify
or produce evidence at a personal appearance proceeding under this Title, travel
expenses and per diem are authorized as provided by the Standardized Govern-
ment Travel Regulations or the Joint Travel Regulations, as appropriate. A
witness whose deposition is taken, and the person taking his deposition, is entitled
to the same fees that are paid for like services in the courts of the United States.
Any appropriation otherwise available to the agency concerned for procurement
shall be available for such expenses.
"Sec. 304. The Secretary may, in accordance with such regulations as he may
prescribe, provide for the reimbursement of all or any part of a net loss of earn-
ings resulting directly from the suspension, denial, or revocation of an authoriza-
tion for access to classified information of an applicant, who, at the time of such
suspension, denial, or revocation, was employed in United States industry if, at a
later time, it has been determined by the Secretary that (1) the applicant is
eligible for an access authorization equivalent to that which was suspended,
denied, or revoked, and (2) after considering all of the facts and circumstances
under which the suspension, denial, or revocation occurred, it is fair and equitable
that the United States, rather than the applicant, bear the loss for which reim-
bursement is to be made. Reimi)ursement may not exceed the difference between
the amount the applicant would have earned as an employee of the same em-
ployer had he continued in the same position as that held at the time of suspen-
sion, denial, or revocation and his interim earnings during the period commenc-
ing on the date of suspension, denial, or revocation and ending with the date of
giving notice to the applicant by regular first class mail addressed to his last
known address of his eligibility for access authorization. The authority con-
ferred by this section may be exercised whether the suspension, denial, or revoca-
tion of access authorization directly causing the loss of earnings, or the subse-
quent determination of eligibility, occurred before or after the date of enact-
ment of this Title. Any appi'opriation otherwise available to the agency con-
cerned for procurement shall be available for such reimbursements.
"Sec. 305. By agreement between the Department of Defen,se and any other
department or agency of the United States, regulations prescribed by the Sec-
retary of Defense under this Title may be extended to apply to protect releases
to or within United States industry of classified information which the other
department or agency has the responsibility for safeguarding. In such cases,
however, any reimbursement authorized by section 304 of this Title shall be made
by the department or agency concerned."
458 HEARINGS RELATING TO H.R. 10175
STATEMENT OF WALTER T. SKALLEEUP, JR., DEPUTY ASSISTANT
SECRETARY OF DEFENSE (SECURITY POLICY), DEFENSE DE-
PARTMENT, ACCOMPANIED BY FRANK A. BARTIMO, ASSISTANT
GENERAL COUNSEL (MANPOWER); GEORGE MacCLAIN, LEGAL
ADVISER AND SPECIAL ASSISTANT TO THE DIRECTOR, OFFICE
OF INDUSTRIAL PERSONNEL ACCESS AUTHORIZATION REVIEW,
DEFENSE DEPARTMENT; AND HERBERT LEWIS, DIRECTOR, IN-
DUSTRIAL PERSONNEL ACCESS AUTHORIZATION REVIEW DIVI-
SION, DEPARTMENT OF DEFENSE
Mr. Taveistner. Now, will Mr. Walter T. Skallerup, Jr., who is, 1
believe, Deputy Assistant Secretary of the Defense Department, comt'
forward, please ?
I believe counsel accompanying you is Mr. Frank Bartimo^
Mr. Skallerup. Yes, sir.
Mr. Tavennek. And Mr. MacClain. Will you introduce the other
members of your group who are present?
Mr. Skallerup. Yes, Mr, Herbert Lewis, who is director of Indus-
(rial Personnel Access Authorization Review Division.
Mr. Tavenxer. Now, Mr. Nittle, will you conduct the examination,
Mr. Nittle. Mr. Skallerup, for the purpose of the record, will you
kindly state your name in full, your official capacitj^ and the agency
whose views you are authorized to present here today ?
Mr. Skallerup. My name is Walter T. Skallerup, Jr. I occupy the
office of Deputy Assistant Secretary of Defense for Security Policy.
, I am here today to present the views of the Department of Defense
with respect to H.R. 10175, and these views reflect the views of tlie
three services, as well as the Department of Defense.
Mr. NriTLE. Do you have a statement to communicate in response
to the conunittee's request for the views of your Department?
Mr. Skallerup. Yes, I have, Mr. Nittle.
Mr. Nittle. Woukl you kindly proceed to give that statement?
Mr. Skallerup. Mr. Chairman and Members of the Committee,
I appreciate this opportunity to appear before the Plouse Committee
on Un-American Activities to discuss H.R. 10175 and to review the
Department of Defense considerations which have led to the submis-
sion of a redraft of the bill.
We appreciate the efforts of tlie committee to strengthen our security
program and are in accord witli the purposes of H.R. 10175 and its
principles. It is believed, however, that certain modifications should
be made in the light of experience gained in the operation of the
industrial security program and Executive Order 108G5,^ Februarj'^
20, 1960, as amended by Executive Order 10909,^ January 17, 1961.
Two important considerations stand out above all others; one is the
case of Greene v. McElroy^ 360 U.S. 474 (1959), and the other is infor-
mation based upon actual exjierience in the conduct of the industrial
1 Executive Orders Nos. 10865 and 10909 marked "Exhibits Nos. 1 and 2," respectively.
See appendix, pp. 519 and 523.
HEARINGS RELATING TO H.R. 10175 459
In Greene, the Court said :
Thus, even in the absence of specific delegation, we have no difl5culty in finding,
as we do, that the Department of Defense has been authorized to fashion and
apply an industrial clearance program which affords affected persons the safe-
guards of confrontation and cross-examination. * * * Before we are asked
to judge wliether, in the context of security clearance cases, a person may be
deprived of the right to follow his chosen profession without full liearings where
accusers may be confronted, it must be made clear that the President or Congress,
within their respective constitutional powers, specifically has decided that the
imposed procedures are necessary and warranted and has authorized their use.
The Chairman. Don't you feel, Mr. Secretary, that that was an
invitation to this committee, or the appropriate congressional commit-
tee, to legislate ?
Mr. Skallerup. I agree, sir.
As a result of the Greene decision, questions were raised with respect
to that portion of the industrial security program dependent upon the
issuance of Statements of Keasons and the conduct of personal ap-
pearance proceedings. Although in our view the Greene case did not
decide any constitutional question, it showed that express authoriza-
tion from the President or the Congress was necessary if the Depart-
ment of Defense was to be empowered to reach final determinations
in the absence of full opportunity for cross-examination.
The Court indicated that it would closely scrutinize any limitation
that might be expressly authorized. It was in this context and in the
equally serious and compelling context of establishing a realistic means
of reaching finality in such cases that Executive Order 10865 was
drawn. By setting forth conditions that must be fulfilled, this Order
expressly authorized specific limitation on cross-examination and
placed the ultimate responsibility for using this authority at the level
of the heads of departments in the Executive Branch.
Inasmuch as the industrial security program also is drawn to pro-
tect classified defense information from willful and inadvertent dis-
closure by persons not motivated by subversion, and from persons who
ma}^ be susceptible to persuasion, coercion, pressure, or blackmail be-
cause of weaknesses in character, associations, or activities, we believe
the proposed legislation should cover more than the area of subversive
activities alone and, therefore, recommend this proposed bill as a new
title to the Internal Security Act of 1950, rather than as an amendment
to the Subversive Activities Control Act of 1950.
Over the years the extent of classified operations outside govern-
mental activities has expanded significantly. They cover not only
industries, large and small, but also educational and research institu-
tions and various nonprofit activities. On occasion individuals are
dealt with as contractors. The term "United States industry" is used
in the draft bill in the broad sense, covering all nongovernmental
activities outside the Department of Defense. These activities also
include, for example, activities carried on outside of the United States
by the employees or other representatives of corporations owned by
United States citizens having their principal place of business located
within the United States. The definition in section 301 is intended to
provide this coverage.
Before commenting on the sections of this proposed bill, I would
like to review the factual background of our industrial security pro-
gram based upon actual experience and, particularly, that informa-
460 HEARINGS RELATING TO H.R. 10175
tion which shows the impact of tlie industrial security program and
the review program upon the work force employed in United States
industry. I would hope that this factual discussion would promote a
public understanding of our program and would help place these
security matters in a sound perspective.
The United States work force engaged in the manufacture of dur-
able and nondurable goods early in 1962 is reported to number 16,400,-
Mr. Tavenner. Mr. Chairman, excuse me a minute, will you pardon
Mr. Skallerup. Go right ahead, Mr. Tavenner.
Mr. TA^^:NNER. May I call this to your attention? The letter of
March 14, 1962, which was presented and which has been introduced
in evidence, has not been read to the members of the committee, so it
is quite possible that the committee members would not readily under-
stand just which bill you are referring to. In order to clarify the
matter, I would like to ask you whether or not your comments relate
to what you consider an improvement on the present bill, and when
you are speaking of "proposed bill," you are speaking of the Defense
Department proposed draft bill that you are presenting here this
morning. Is that correct ?
Mr. Skallerup. Mr. Tavenner, and Mr. Chairman and Members
of the Committee, my remarks are addressed to the proposed draft
bill, so that when I cite sections like this recent citation of section
301, it refers to the proposed draft bill.
The Chairman. That you are offering ?
Mr. Skallerup. That we are offering, yes, sir. In general, of
course, these remarks have a direct bearing on H.R. 10175.
• The Chairman. Yes.
Mr. Skallerup. This was done for purposes of simplicity. We
thought it would be simpler to proceed in this manner.
Mr. Tavenner. Pardon the interruption, if you will begin your
paragi'aph over again, please.
Mr. Skallerup. The United States work force engaged in the man-
ufacture of durable and nondurable goods early in 1962 is estimated to
number 16,400,000 people. This is roughly one-fourth of the total
United States work force. Our estimate of the cumulative total nnm-
ber of access authorizations granted in industry since 1949 is 5.000.000.
The total cumulative number of cases which have come under the De-
partment of Defense industrial review program since 1953 is about
The language of both the Executive Order and the proposed legis-
lation is in sufficiently broad and general terms to cover the entire
industrial security program, both in its granting aspects (the 5,000,000)
and its review aspects (the 4,600).
In looking over the 4,600 review cases since 1953. of which a little
over 800 have come under the current program which began August 1,
1960, after the Greene case, it appears that a high percentage of per-
sons receiving a Statement of Reasons (SOR) defaulted by not reply-
ing to the Statement of Reasons. Defaults occur in over 30 percent
of the cases where a Statement of Reasons has been issued.
Between April 1955 and March 1962, it appears that the preponder-
ant majority of grants in the review program have been made by the
HEARINGS RELATING TO H.R. 10175 461
Screening Board. Tlie Screening Board accounts for about 85 per-
cent of all grants. Nevertheless this number accounted for an average
of only 35 percent of all cases sent to the Screening Board, including
the still pending cases.
Only a minority of all cases received into the review program ever
reach the personal appearance proceeding stage, namely, about 20
percent. Of those cases which do reach the personal appearance pro-
ceeding stage, there are more denials and revocations than grants, with
an average of about 42 percent grants and 58 percent denials and
Since 1960 under the present program a higher percentage of ap-
plicants have defaulted by failing to reply to the SOR. Percentages
have increased from 30 percent to 33.2 percent, and the percentage of
denials and revocations by the Central Board has increased from 54.7
percent to 61.2 percent.
A review of cases under the present 1960 program also discloses
the remarkable fact that out of a total of about 800 cases which have
come under the review program, of which 500 have been completed
and 300 are pending, there are only 11 — and the number eventuall}'
may be less than 11 — in which there is need for use of a cei'tiiicate to
limit opportunity for cross-examination. In all other instances suffi-
cient information has been obtained to go forward with the case and
provide an opportunity for cross-examination with respect to those
allegations which were in controversy.
Therefore, I would conclude that by dint of hard work and the
splendid cooperation of other agencies and departments in tlie Execu-
tive Branch of the Government, the Department of Defense industrial
security review program has been able to operate effectively within
the traditional legal framework, and that only in a very small number
of cases is a resort to exceptional procedures apt to be necessary. In
short, our procedures and practices have recognized the interests of
individuals and have established safeguards to protect these interests.
Sections 301, 302 of the draft revised bill would provide express
legislative authority for the establishment of standardized procedures
for the industrial security program, including the review program.
These sections would not impair the authority of the Secretary of De-
fense under regulations prescribed by the President to dispense with
such procedures when he decides that the national security so requires
in the particular case and when, thereupon, lie makes the decision on
eligibility in the case,
Mr. ScHERER. Pardon me just at that point. Your draft bill, then,
doesn't have any sections which would allow the elimination of cross-
Mr. Skallerup. There are sections in it, sir, which would permit
the elimination of cross-examination.
Mr, Sciierer. Maybe I didn't follow you, but I understood, from
what you just said, that it wouid eliminate such language.
Mr. Skallerup. Well, my purpose in reviewing the experience un-
der the program was, first, to demonstrate that really it is only in a
very small minority of cases that people cannot be confronted with
witnesses and be given the opportunity to cross-examine them.
The second point is that in the legislation which we are proposing,
authority would be granted to the Secretary of Defense under regula-
462 HEARINGS RELATING TO H.R. 10175
tions prescribed by the President in individual and particular
Mr. ScHERER. Not to require cross-examination ?
jMr. Sk^^llerip. Xot to require cross-examination.
Mr. SciiERER. That is in this bill that you propose ?
Mr. Skallerup. Yes, it is, and Mr. Bartimo, assistant general coun-
sel, would like to comment on this point.
Mr. Bartimo. May I, in answer to your question, Mr. Scherer, pin
that point home ? Section 302 of the draft bill reads as follows :
Except in cases where the Secretary personally determines that such pro-
cedures cannot be employed consistently with the national security, in which
event the Secretary will personally make the determination to deny or revoke
This language is designed to take care of the point which you are
making ; that is the exceptional case. Because of national security in-
terests, the Secretary of Defense may not decide to go ahead with these
procedures. The cross-examination procedures may not be employed,
and on his own determination the Secretary of Defense may make the
decision to deny this particular individual the privilege of access to
our classified information.
Mr. Scherer. I understand.
Mr. Skallerup. I am coming to that point in this following para-
Section 302 contains an express legislative authorization whereby the
Secretary of Defense, under such regulations as the President may
prescribe, may limit the opportunity for cross-examination.
The Chairman. May I interrupt at that point?
, Mr. Skallerup. Yes, Mr. Chairman.
The Chairman. "Wouldn't it be preferable to spell out the type of
cases, rather than to have the President issue regulations? l^Hiy
wouldn't it be better to take this entirely away from the field of regu-
lations and write a statute to cover it ?
Mr. Skallerup. Well, the thought here is that this would provide
legislative authority to achieve these results. The President through
his Executive Order, and particularly in section 9 of the Executive
Order, has granted this authority.
Mr. Scherer. Well, what the chairman means, is that you would
pliminate the necessity for regulation, because we would spell it out
in the statute.
The Chairman. You see, this provides express legislative author-
ization for regulations to be issued by the President. Now why isn't
it better to spell out the regulations fully b}'' statute?
Mr. Bartimo. Mr. Chairman, I think you are raising a very good
point and one which we have discussed extensively, both in the De-
partment of Defense and with our colleagues in the Department of
Justice, and I think the problem comes about, sir, in trying to spell
out sjiecific criteria in slatnte which would cover that area.
It is most difficult to do and, therefore, we would urge and recom-
mend that the Congress, that this committee, set forth guidelines, and
leave the flexibility in the Executive Branch to go which way it deems
best in the national interest.
Mr. Scherer. Well, you would have to spell it out in your Executive
Order, wouldn't you?
HEARINGS RELATING TO H.R. 10175 463
^fr. IxvKTiMo. It is true, sir.
Mr. SciiERER. You nier.n you could olmuuv I lie Executive Order,
from time to time, to meet specific instances?
i\Ir. Bartimo. Precisely.
Mr. SciiERER. ?ToAv -would that atl'ect future cases before the Su-
preme Court? Wouldn't you be in better shape in doing what the
chairman suggests by spelling it out in the law, rather than leaving it
The Chatrmax. HaA'ing in mind the decision in the Greene case.
Mr. Bartisio. I believe, sir, that if this committee sets forth clearly
both in its legislative history and the broad language of the statute
that which you have in mind, the Secretary of Defense has tlie author-
ity to implement your guidelines, with specific language. In such
a case I am sure that the courts would determine that he is operating
under authority given to him by the Congress.
Mr. SciiERER. You think that would meet the requirements in the
Greene case? I know it isn't part of the decision, but it is obiter
in the Greene case, isn't it?
The Chairmax. I think the obiter dictum very definitely indicates
the danger that we are confronted with in permitting the administra-
tive finding to prevail.
Mr. Bartimo. I would agree, sir, v,"ith your statement, that the
dicta, or the obiter dictum as you put it, does give us an indication
of the thinking of the Supreme Court. In our judgment, the Su-
preme Court is in effect, in a statesmanlike manner, pointing out to
us the deficiencies in our procedures pre-Greene.
We believe that, with the revised draft of the bill which we are rec-
ommending to you for consideration, the guidelines and the specific
criteria set forth will be sufficiently clear to indicate the will of this
committee and the Congress, should the bill become law.
"We believe under those circumstances the Supreme Court, looking
at another case in the future, would reach the conclusion that you
have in mind. The guidelines are clear, the reasons are clear. The
will of Congress is clear.
Mr. ScHERER. Now this bill, as I understand it, is limited solely to
classified information, is it not ?
Mr. Bartimo. That is true, sir.
Mr, SciiERER. Since 1952, I remember the Defense Department has
been asking for legislation similar to this that deals with nonclassified
material, has it not?
Mr. Bartimo. I am not familiar with that, Mr. Scherer.
Mr. SciiERER. I have listened to testimony from the Defense Depart-
ment asking for legislation similar to this to deal with individuals
in defense plants where the individuals do not handle classified
Mr. Bartimo. Yes.
Mr. Scherer. But would be working on normal or regular weapons
Mr. Bartimo. Yes, I think, Mr. Scherer, if we may for the record,
I believe you had in mind a piece of legislation which — if I may devi-
ate for a moment and congratulate this committee for its marvelous
work in not only getting the bill through the committee but past the
House, whereby the Secretary of Defense, upon his finding that a
464 HEAKINGS RELATING TO H.K. 10175
particular plaiil or industry is considered a defense plant industry,
and such a plant or industry is posted, it puts on notice a member
of the Communist Party that he would be in violation of a criminal
statute to continue to be so employed in such a facility. That is point
Mr. ScHERER. Pardon me. That provision is applicable since the
Supreme Court last fall sustained the Internal Security Act of 1950.
Mr. Bartimo. That is correct, sir, I agree.
Mr. SciiERER. You think that eliminates the necessity for the legis-
lation which the Defense Department lias been requesting since 1052,
that we have legislation or that we authorize the setting up of pro-
cedure to deal with individuals in defense plants who are not handling
classified work ? I know^ I introduced a bill a couple of times to take
care of that situation, at the request of the Defense Department.
Mr. Bartimo. Yes, sir, let me say this. I think that, in part, I
would agree with your statement. Plowever, what you are really
coming up against on the nonclassified information is a very esoteric
area of great magnitude. Let us say this — and I am sure this com-
mittee realizes it far better than we — that an individual may go
around and pick up pieces of unclassified information; when those
pieces are put together, it may in effect result in a classified document.
This has been proven, as you know, from research groups that have
I think there was a group at Yale that did it. They picked up the
various committee hearings, the appropriation hearings, what ap-
pears in technical magazines, such as Aviation Week, and they put
that together and it became a bundle of useful information.
I do not know that we can ever find the panacea to solve this ill.
We are a free nation, a free democracy; the fourth estate operates
with great freedom : T am sure we want it that way.
I think as a point of departure, however, it is up to the individuals
who have access freely throughout our country to have a degree of re-
sponsibility. Security in this Nation is not only the job of this com-
mittee and the officials in the Department of Defense. Tn our judg-
ment it is the responsibility of every citizen.
It seems to me that discretion and judgment are most important;
that if an individual or a newspaperman or a technical magazine has
gotten access to information which in their judgment should be known
to be sensitive, they ought to treat it as such!
I don't believe, sir, that we can ever legislate that all information
not classified has to undergo certain rules and regulations. I think
we would frustrate the very freedoms we are seeking to preserve.
Ml-. ScnERER. Well, T am not talking necessarily about informa-
tion ; but I remember your predecessors from the previous Adminis-
tration, who came from the same agency in the Defense Department
that you gentlemen do here today, pointed out that they lacked the
ability, because of the lack of legislation, to take care of a subversive
person who didn't even work in the defense plant, but worked in a
utility plant that supplied power to a defense plant; and they were
asking us for legislation since 1952 to set up procedures whereby we
might either get rid of that person in that position or in some way
control him, because they pointed out that that individual was as
dangerous to our security as a person handling classified information,
HEARINGS RELATING TO H.R. 10175 465
or a person actually employed m the defense work on normal defense
Now that is the point. "We have no legislation to deal with that,
except perhaps the Internal Security Act, w^hich has now been held
constitutional and which says that no Communist may work at such
a position. But what about a person that you cannot prove is a Com-
munist ? And most of the persons that would be in a position to pull
the switch may not be members of the Communist Party.
Mr. Bartimo. I think specifically, Mr. Scherer, on the point, your
example of the subversive, if we could determine and prove he was
a subversive, undoubtedly he would also be a Communist.
Mr. Scherer. That is not necessarily so.
Mr. Bartimo. Well, in the case where it isn't necessarily so, I would
have to agree with you, on your example, that we do have a hiatus,
that it is an area in which we do not have specific statutory authority
Mr. Scherer. You don't have statutory authority to cover even per-
sons working in defense plants on conventional weapons, do you?
Mr. Bartimo. That is correct.
Mr. Scherer. Now has the Defense Department abandoned its re-
quest for such legislation ? I won't keep on introducing my bill if you
Mr. Bartimo. I believe the answer to that is, it is not necessarily
abandoned. It is I believe a very, very difficult area to legislate iii.
Mr. Scherer. Are you familiar with the bill that I introduced?
Mr. Bartimo. I am not, and I apologize. We should reread your
Mr. Scherer. Well, it wasn't my bill, it was recommended by the
Defense Department. The language in it was recommended.
The Chairman. Defense and industrial.
Mr. Bartimo. May we take this point up later and relook at the
bill, and determine if the position of the Executive Branch is as it
was, evidently, when it was submitted here ?
Mr. Scherer. Yes. The only reason I raise that issue now is, if it
is necessary that we have such legislation, and if you still feel that it
is necessary — and I certainly feel it is, because I feel that a person
such as I have mentioned is as dangerous, perhaps, to the security of
the United States as is some person handling classified material — we
perhaps could add such provisions to this bill.
Mr. Bartimo. May we take a look at it, sir, when we go back, to the
Mr. Skallerup. It is certainly an appropriate time to consider it,
The Chairman. May I ask you whether or not you conferred with
Justice concerning this proposal ? Because they are well acquainted
with what Mr, Scherer is talking about.
You see, the thing that disturbs us is — today a particular plant is
covered, and tomorrow it isn't. Changing conditions, of course, have
to be met. I believe that the Justice Department has some very strong
views on this.
Mr. Bartimo. We will be most happy, Mr, Chairman, to consult
with our colleagues in the Justice Department on this point.
466 HEARINGS RELATING TO H.R. 10175
The Chairman. Have you submitted your proposal to the Bureau
of the Budget ?
Mr. Bartimo. Our proposal has been submitted to the Bureau of
the Budget, and they have determined that our recommended proposed
legislation conforms to the program of the President. Therefore, it
is approved by them.
The Chairman. Therefore, the Justice Department has seen it.
Mr. Bartimo. The Justice Department has seen it, and you will have
the opportunity to have the Assistant Attorney General, Mr. Walter
Yeagley, as a witness, I understand. I am sure he will be most happy
to address himself to this point.
The Chairman. All right.
Mr. ScHERER. In considering the proposition that I raised, you
iiiight want to take a look at our hearings in the Pittsburgh area,
designed to support legislation such as I have indicated, in which we
showed that there were five plants in the Pittsburgh area whose em-
ployees were represented hj unions that had been expelled from the
CIO because they were Communist-dominated and controlled, and
also showed that indi^ndual members of those unions were members
of the Communist Party, at that time working on defense contracts.
Not classified, however, but working on defense contracts. And it
has been indicated, we have no legislation to handle those individuals.
Mr. Bartimo. "We will be glad to look at that, Mr. Scherer.
Mr. Scherer. One of those plants could be easily sabotaged if we
should get into a shooting war with the Soviet Union.
Go ahead. I am sorry.
Mr. Skallerup. Section 302 contains an express legislative author-
ization whereby the Secretary of Defense, under such regulations as
the President may prescribe, may limit the opportunity for cross-
examination. In stating this authority, the draft bill does not ex-
jiressly reiterate each and every requirement and condition set forth in
ihe Executive Order. However, we believe there is no conflict be-
tween what the draft bill requires and what Executive Order 10865
The Department of Defense intends to continue to apply all the
requirements of the Executive Order and in so doing will meet every
requirement expressed or implied in the proposed legislation.
At this time I submit for the record, a copv of Department of De-
fense Directive 5220.6.^ dated July 28, 1960, which carries into effect
the authority granted by Executive Order 10865. A copy of that
Executive Order is appended to the directive. I also submit copies
of Executive Order 10909, which amended Executive Order 10865.
Section 303 of the revised draft bill would provide legislative
authority whereby the Department of Defense could pay travel ex-
])enses and a per diem available from appropriated funds to cover
the expenses oi witnesses called by the Department of Defense to give
testimony or produce evidence in personal appearance proceedings.
By virtue of Executive Order 10909, the Dei^artment of Defense is
expressly authorized to furnish travel in kind and to pay other actual
expenses to witnesses not to exceed a per diem of fixed maximum
amount. Section 303 also would provide legislative authorization
1 Department of Defense Directive 5220.6 marked "Exhibit No. 3." See appendix,
HEARINGS RELATING TO H.R. 10175 467
for the pajnnent of certain fees in connection with takinjr depositions.
P'or many years the Department of Defense has antliorizecl the reim-
bursement of lost earnings directly caused by adverse actions in the re-
view program. This action has been discretionary with the Depart-
ment, and has not been intended to create a legal right in an applicant
to demand reimbursement. Reimbursement is not contemplated for
applicants who have not been found eligible for access authorization
prior to the time of filing their claims. Reimbursement is intended
only when and to the extent required b}^ considerations of fairness and
The draft bill is intended to express the policy that reimbursement
is absolutely discretionary with the Department ; that it is not a legal
right of the applicant under this bill ; that it will be made only on
grounds of fairness and equity which clearly show that the Govern-
ment, rather than the applicant, should bear the loss; and that the
maximum reimbursement must be calculated in terms of nonspecula-
tive sums of money.
The section would grant such authority and make appropriated
As indicated in the Department's letter transmitting the revised
draft bill, the Department of Defense has entered into mutual agree-
ments with certain other departments and agencies of the Govern-
ment; namely, the National Aeronautics and Space Administration,
the Federal Aviation Agency, the General Services Administration,
and the Departments of State and Commerce. Under these agree-
ments the industrial security program of the Department of Defense
is made available to other agencies of the Government for the resolu-
tion of cases in which such agencies are concerned with safeguarding
classified information which they are responsible to protect.
By these agreements, an economy of effort and funds can be accom-
plished while, at the same time, affording a wider base for the applica-
tion of the experience of the Department of Defense in administering
this program. Section 305 of the revised draft bill is designed to ap-
prove such agreements now in effect and to provide legislative antlior-
ity to enter into similar agreements with other agencies or depart-
ments, as desired from time to time.
In recent years, the Department of Defense has been administering
a program to provide protection for classified information belonging
to other countries which is entrusted to the United States and released
to United States industry in furtherance of international defense ef-
forts. The term "classified information" in section 301 is understood
to cover broadly all classified information, regardless of country of
origin, which the Department of Defense is obligated to protect.
(At this point Mr. Walter left the hearing room.)
Mr. Skallerup. As you can see, the draft bill does not include sub-
pena authority. Experience under Executive Order 10805 has shown
that most cases can be resolved on the open record through witnesses
and documents presented by the Department to the Field Board. The
extreme minority of cases (11 out of 800) in which certified testimony
and documents may be needed would not be resolved by subpena au-
thority because certified testimony and docmnents would still be
needed. The Department would prefer to gather more experience be-
468 HEARINGS RELATING TO H.R. 10175
fore supporting a grant of subpena authority at this time. It will
advise the Congress if and when the authority has been shown to be
necessary to the continued success of the program.
(Mr. DoA'le presiding.)
Mr. Doyle. Proceed with your statement, please.
IMr. Skali^rup. "We shall be liappy to try to answer any questions
that the conmiittee may wish to ask and to furnish in greater detail
any information which thus far has been covered only in general
That concludes my statement.
Mr. Doyle. Thank you very much.
Counsel, do you care to ask any questions ?
Mr. NiTTLE. Yes, sir. Mr. Skallerup, I want to call your atten-
tion to the letter of March 14, 1962, of the General Counsel of the De-
partment of Defense, forwarded to the committee in response to its
request for the views of the Department. This letter has already been
offered for the record at the commencement of this proceeding.
There is a statement therein as follows :
In view of the action of the President in Executive Order 10865, the proposed
legislation is not considered necessary.
Now in view of the fact that a committee of the Congress does not
wish to engage in useless motions, perhaps that should be clarified on
Certainly, we do not mean to suggest by the introduction of H.R.
10175, which is the bill under consideration, that the Defense Depart-
ment has not met its responsibilities following the decision in Greene
v. McElroy^ or prior thereto. As a matter of fact, your Executive
Order 10865, which was promulgated immediately after the decision,
was an attempt by the Defense Department and the President to ful-
fill its responsibilities in maintaining the security of classified infor-
mation released within industry.
However, I call your attention to certain language in Greene v. Mc-
Elroy. The Court struck down the security procedures of the Defense
Department on the ground that in setting up what may be described
as a limited hearing procedure, the Department had exceeded its au-
thority. Chief Justice Warren said, "it must be made clear that the
President or Congress, within their respective constitutional powers,
specifically has decided that the imposed procedures are necessary
and warranted and has authorized their use."
Perhaps moi-e pointed is the language of the Chief Justice at page
Whether those procedures under the circumstances comport with the Constitu-
tion, we do not decide. Nor do we decide whether the President has inherent
authority to create such a program, whether congressional action is necessary,
or what the limits on executive or legislative authority may be. We decide
only that in the absence of explicit authorization from either the President or
Congress the respondents were not empowered to deprive petitioner of his job
in a proceeding in which he was not afforded the safeguards of confrontation
Now, Mr. Skallerup, in the light of that language of Chief Justice
Warren, would you not agree that congressional action would place
the Presidential order upon a finn basis and would remove any doubt
at all as to the Presidential authority to create the specific program
which has been set up in Executive Order 10865, as amended ?
HEARINGS RELATING TO H.R. 10175 4G9
Mr. Skaij.erup. Inasnmch as I have Mr. Bartiiiio from the General
Couiisers Ollice and inasmuch as your questioning relates largely to
questions of legal authoiity, 1 think it would be appropriate for me
to ask Mr. Bartimo to answer it.
iNIr. Bartimo. Thank you, Mr. Secretary.
I tliink. Mr. Xittle, you are raising a very significant and a very mi-
portant })oint in which we ought to build some clear legislative history.
I think your quote from Greene v. McElroy is very pertinent.
The Supreme Court did not cross the bridge of whether or not the
procedures violated any constitutional provision, as you have indi-
cated. It simply said that the Department of Defense does not
have the authority either specifically under an Executive order of the
President or a statutory provision. In my judgment, the Supreme
Court in a statesmanlike manner was pointing to us a way to remedy
I believe j^ou will agree with me that we should not make any legis-
lative history in this liill which would indicate or cast the least doubt
that the Executive Branch is impotent to act in an area so important
as protecting the classified information of our Government.
I think we ought to be clear that the President of the United States,
under his constitutional prerogatives, under his constitutional man-
date, has the authority and has the duty to step in and act.
(At this point Mr. Tuck left the hearing room.)
Mr. Bartimo. I think tlie President of the United States did that
when he promulgated the Executive Order to which you refer.
^Ir. SciiERER. Now I agree with your reasoning thoroughly, be-
cause tliat is where I disagreed with the Supreme Court in the Greene
case. I think the President, as Commander-in-Chief, has the right to
do what lie wants with classified information of this Government, and
he should be able to prevent a person from having classified informa-
tion if he doesn't like the way he parts his hair, because classified
information is a property right in the Government of the United
Mr. Bartimo. I agree with you.
Mr. SciiERER. I then agree with Mr. Nittle, although I don't agi'ee
with the decision, that w^e should do everything we can to comply with
the Court's decision.
Mr. Bartimo. I agree that we should, Mr. Scherer.
Mr. Scherer. I think it is wrong. I think the Supreme Court is
wrong in this case. I think the Pi-esident does have inherent right, as
I said, as Commander-in-Chief, to control a property right of the
Government of the United States and to let his agent's or employees
or any individuals have possession of it so long as he wants them to
have possession of it.
He should have the inherent right to deprive them of it, whether
they are security risks or not.
Mr. DoTLE. May I suggest at this point, the bells have sounded.
Mr. Scherer. Is that a quorum call ?
Mr. DoYEE. That is a quorum call.
Mr. Tavenxer. Have you finished?
Mr. Bartimo. No, sir.
Mr. Ta'\t:nner. May I suggest, the witness has not quite finished,
and if you could remain long enough
470 HEARINGS RELATING TO H.R. 10175
Mr. JoHANSEN. Could we wait, Mr. Chairman, until the second
jNIr. Doyle. Well, we will still have to adjourn for 20 minutes, any-
way, when we do go.
Mr. JoiiANSEN. You are comin^ back?
Mr. Doyle. Oh, yes, we must come back, but may the witness under-
stand we reo:rot that the bells have sounded, and we must go, but we
will return at the earliest possible moment.
Mr. ScHERER. Can he finish his statement that I interrupted?
Mr. Doyle. Yes, proceed.
Mr. BARTuro. In addition to the statement I have made, ]\fr. Nittle,
you are raising a ver}' significant point as I have stated: Is legisla-
tion necessary? I believe that that question can be answered suc-
cinctly, that it certainly is a marvelous thing to have the President's
Executive Order buttressed by the will of the Congress, to set forth
clearly a congressional intent,
I would like to add a footnote to Mr. Scherer's remarks, also for
legislative history. The Supreme Court did not in its decision in
Greene v. McEJroy upset the entire industrial security program. All
it said is that we do not have either ExecutiA^e authority or statu-
tory authority to finally deny an individual without a confrontation
hearing. The rest of the industrial security program, as the Secretary
indicated, is a vast one. Only a small percentage of cases are affected
by hearings which involve the confrontation issue.
I think he said about 11 cases, and I think it is significant for us to
pin that point home.
Mr. D0Y1.E. The committee will stand in recess for about 15 or 20
minutes while we answer the roll call, and then we will immediately
Sorry to cause the witness this inconvenience.
(Whereupon, at 11:05 a.m., the committee was recessed to be re-
convened the same day.)
Committee members present: Clyde Doyle, of California; Gordon
H. Scherer, of Ohio ; and August E. Johansen, of Michigan.
Mr. Doyle. Let the committee reconvene. A quorum is present,
following the quorum call on the floor.
Are you ready. Counsel ?
Mr. Ntttle. Yes, sir.
Mr. Doyle. Proceed.
Mr. Nittle. Mr. Skallerup, the Supreme Court in Greene v.
McElroy seemed particularly concerned that there should be an expres-
sion by the President or the Congress that the actual procedures estab-
lished are necessary.
Now it would seem that the mere fact that these procedures have
been adopted in Executive Orders and in regulations of the Secretary
of Defense wonld be a clear expression of their necessity.
Nevertheless, it seems that to clear the record, there should be a
positive expression on your part, as to whether or not a limited hearing
or personal appearance procedure, such as is established in the bill
under consideration and also under your proposed draft bill, is neces-
sary in fact.
HEARINGS RELATING TO H.R. 10175 471
Mr. Skallerup. In our view, it is not only desirable, but necessary.
Mr. NiTTLE. Could you elaborate on the point of necessity for
establishing a personal appearance proceeding which limits, in certain
reasonable circumstances, the confrontation and cross-examination
of adverse witnesses ?
Mr. Skallerup. INIr. MacClain will respond.
Mr. MacClain. First of all, I should like to say that we strongly
endorse the principle that we should do everything within our power
to provide each applicant with every reasonable opportunity to demon-
strate his eligibility as he sees it, and that we should do everything
within our power, likewise, to inform him of the things about him
that have come to our knowledge that raise questions in our mind
as to his eligibility. But it is plain from experience that there are
sources of information which are valuable to the United States Gov-
ernment in its continuing eliort to protect the security of the Nation,
and that the value of these sources of information is lost when the
sources are identified.
It isn't a situation where you are considering an activity of a man
m the light of whether or not he should be criticized for that activity
and whether or not, in order to prove his activity, you bring forth or
don't bring forth a particular informant. In our area, what we are
doing is protecting entirely the interest of the United States. If an
informant is vital to that interest, then his identity must necessarily not
be disclosed if we are to continue to have him available for the purpose
This, from our experience, does happen, and from our experience,
we know that we do need to have the authority to limit the right of
cross-examination for this purpose. At the same time, we know that
in achieving that end, we can also help to serve the interest of the appli-
cant by summarizing for him as much of the information as we can,
without disclosing the identity of this confidential and precious source.
If the committee would like to have me do it at this time, or at any
time, we would show how tlie proposed revised bill, interlocking with
the Executive Order, would accomplish these purposes and, at the
same time, establish for the individual case the degree of reliability
of the source and the accuracy of the information from the source.
This is slightly detailed, and I would be very glad to do it, if you
would like it to be done.
Mr. DoTLE. Yes. we would like very much for you to do it.
Mr. MacClain. There are in general two classes of witnesses. "We
may call one of these classes the confidential witness v/ho is engaged in
furnishing intelligence information to the United States Government.
This category of witness is especially the kind whose identity must not
Under the Executive Order and under our program as now operated
and under the proposed revised bill as we would see it, this category
of informant is made available to our program through a certificate
from the head of the investigating agency whose informant it is. For
example, the Attorney Genera] would furnish a certificate for an in-
formant in that category, and the certificate would state that the
informant is a confidential informant, that he has been engaged in
furnishing intelligence information to the Government, and that the
472 HEARINGS RELATING TO H.R. 10175
disclosure of his identity would be substantially harmful to the
The other category of informant is just anyone who has information
with respect to the matter at hand. He could be a friend or a neigh-
bor or a fellow employee or a doctor or just anyone who has informa-
tion available. Here the purpose of permitting us to use his inforaia-
tion is that the circumstances laid out in the Executive Order, and as
they would be iinplemented under our proposed bill, are such that it is
literally impossible to produce him for cross-examination. Thus, the
v\itness could not be produced because of death or serious illness or
for a similar reason, or for some other reason which the head of the
department concerned — in our case, the Department of Defense — de-
termines is a good and sufficient reason.
If the head of the department is prepared to make a preliminary
determination as to the reliability of the source and the accuracy of
the information, based upon information furnished to him by the in-
vestigative agency, and if the head of the department is further pre-
pared to state that failure to use this informaion would adversely
affect the security of the Nation, and if after all of that has been said
and done, he is ready to state the reason why the informant cannot
come forward for cross-examination, then, under those circumstances,
we can use that information.
Now with respect to both of these categories, there are not only these
conditions precedent to the use of the information, but there are also
conditions subsequent. The first condition is that the individual shall
be informed of the information as fully as the national security will
permit. Secondly, consideration must be given to the fact that oppor-
tunity for cross-examination was not made available to him, and
finally, and maybe most important of all, under the Executive Order
and under our regulations, and under our intention, an adverse deci-
sion in that kind of a case can be made only by the head of the depart-
So you can see that with respect to our authority to limit cross-
examination, the decisions as to the need for it and the final decision,
if it is adverse, on eligibility, are placed right at the head-of-depart-
ment level, wliich gives the individual maximum protection within
the Executive Branch.
I want to add just a further word. In our experience in administer-
ing tlie program under the existing Executive Order, we view this
authority to limit cross-examination as something to be utilized only
when absolutely necessary. I think that this is demonstrated very
convincingly by the fact that, after operating since August 1960, we
have today out of several hundred cases only 11, and maybe less than
11, in which we think it will be necessary to use this exceptional
Now this is our attitude, but we absolutely know tliat there are those
cases where, if we are going to safeguard classified information and
not disclose precious sources, we have to have tliis tj^pe of exceptional
authority, which is one of the subjects in this bill.
There is a little further word on this subject that Mr. Bartimo
would like to add.
Mr. Bartimo. I think tliat Mr. MacClain has made a very lucid and
succinct statement on the exceptional procedure in the overall picture
HEARINGS RELATING TO H.R. 10175 473
here, but I think we ought to put on the record the fact that the
Department of Defense, or the Executive Branch, is not seeking to
control tlie movements or the employment of individuals in civilian
This is not our objective. I think it is important to note here that
when the Executive Branch has classified information, this informa-
tion belongs to the country, to the people who are charged with protect-
ing this information. Therefore, it is our view that access to this
information is not a right ; it is a privilege.
Based on that philosophy, we have bent every eilort within the
American framework, the American spirit of giving everyone who
wants the privilege of getting access, what we believe is a fair hearing.
I think this is important to bear in mind throughout the hearing,
that we are not denying anybody the right to go to work at plant A or
B or wherever he chooses.
I think it is important also to note that where an individual who
comes to us for consideration for access to classified information, and
is denied that access to classified information, it does not necessarily
follow that this individual must be dismissed from his employment.
He might work in an area where there is no classified information.
He certainly has the right to manufacture percolators or automobile
wheels, or many of the millions of gidgets and gadgets which our
economy needs. But he certainly shouldn't have the right after this
screening process, if there is some doubt as to his reliability or trust-
worthiness, to have access to our classified information.
I think that this view is most important, and I would hope that the
courts, in analyzing a case which might come before them, would give
due consideration to this basic understanding, this basic philosophy.
Mr. NiTTLE. Certainly, would you not agree that the Government
is placed in a very serious dilemma if it cannot control access to classi-
If the Government cannot control it, then the Government must
oither divulge this information, release it to persons of doubtful char-
acter and integrity, or not have necessary work done in industry.
Isn't that correct?
Mr. Bartimo. I would say that is correct, Mr. Nittle.
Mr. ScHERER. Don't you think — and if classified information is a
property right, it belongs to the Government of the United States —
don't you think we are leaning over backwards when it becomes neces-
sary to deprive a person of further access to classified information to
even make all of these procedures available to him ?
He has no basic right to that information, does he ? As you point
out, it is not a right, it is merely a privilege. He acquires no property
]Mr. Bartimo. Well, Mr. Scherer, I think you and I agree that under
our American way of life, we should take every precaution, every
means at our disposal, to be certain that we do not stigmatize unjustly
an individual ; and I think you will agree that because we are human
beings, mistakes are apt to be made.
We want to stretch every effort to be certain that our procedures are
such that we don't make a good citizen a citizen who is disgruntled be-
cause he was unjustly accused. This is fundamental in our criminal
procedures. We are willing in our criminal procedures to have a
474 HEARINGS RELATING TO H.R. 10175
criminal go free rather than to incarcerate the innocent. Within that
philosophy, and always having in mind that we must protect the na-
tional security interests, these procedures are geared with the hope that
they will be accepted by the Congress and the American people and
also the courts.
Mr. Doyle. May I inquire if unclassified information is the prop-
erty of the Government ? What is the property right of an applicant
to have unclassified information given to him ? Wliat is his right of
claim to that, if any ?
Mr. Bartimo. Well, Mr. Doyle, I think that we are agreed that any
information in the possession of the Executive Branch is inforaiation
belonging to all of the American people. Some of it must be classi-
fied, because our potential enemies might make use of it to our detri-
ment. The unclassified portion of the information which you address
yourself to is that information which ordinarily is in the public do-
main, and yet, there is a segment of that unclassified information
which should not be in the public domain, because it is privileged-type
For example, supposing the Executive Branch were debating
whether or not a certain policy should be promulgated. Many views
are gotten throughout the Executive family; oftentimes we consult
informally with the Congress to get their guidance. ITntil the policy
is promulgated, it is not fair to release that type of information, it
seems to me, to the detriment of candid views, to the detriment of a
solid, educated policy that has all the facts ancl figures. I think it is
important to note that where that type of situation prevails, various
pressure groups might come in and press their point of view.
This is the reason, I think, and I am sure we all agree, that we
should have this type of Executive-privilege philosophy. It is not
that we are withholding information. It is only because we want, in
all candor, to examine all possibilities, so that when the final decision
is made, it is the best judgment of the people who have the responsi-
bility to make the decision.
Mr. Doyle. May I further inquire at what level is the screening of
the information about an applicant made? Before you send the ap-
plicant any notice to appear, how many people are involved in making
that decision, so as to screen it for veracity and lack of bias and these
other things that might well enter into it ?
Mr. Bartimo. Mr. Lewis is here today to answer questions along
this line, sir.
Mr. Lewis. The final screening before a Statement of Reasons would
be issued to the individual is done by a Screening Board located in the
Office of the Assistant Secretary of Defense. At the present time
Mr. Doyle. Would you speak up just a little louder?
Mr. Lewis. I am sorry.
At the present time, we have a six-man screening board, sitting in
two panels, made up of senior military officers and civilians of consid-
erable experience, both in security and with legal training. And it
is only after a group of three men has completely evaluated all of the
investigative material that the letter of charges or the Statement of
Reasons is issued.
Mr. Doyle. Does that board, after screening the material, ever re-
fuse to put an applicant on notice that they have discovered prejudice
HEARINGS RELATING TO H.R. 10175 475
or ill will or anything of the sort entering into a complaint or informa-
tion ? Has that ever occurred ?
]\lr. Lewis. Well, all of the information is verj' carefully evaluated,
and as the Secretary pointed out earlier, a vast percentage of the cases
which reach this level do result in clearances by that board.
Mr. Doyle. How do they reach that level, those cases ? This board ?
And what levels do they reach before they get to the board ?
Mr. Lewis. The cases originate within the military departments,
and they originate at the field level. Each of the military depart-
ments has a slightly different organizational setup.
Let me describe the Army setup for you. The security office at the
headquarters of each Army in the United States — each Continental
Army, plus the Military District of Washington, has a security office
vvhicii is responsible for initially processing the requests of industry
for an access authorization. They conduct the necessaiy record
checks and held investigations and. then evaluate the results. If in
their opinion the officials at the Army level are satisfied with the re-
sults of the record checks and investigation, they are authorized —
they have delegated to them the authority from the Department of
Defense — to grant the access authorization. If they do not, or if
they are not satisfied with tlie results, then the case is forwarded from
the Army level to the Department of Army Headquarters, the Assist-
ant Chief of Staff for Intelligence.
There another review is made. Further investigation may be made ;
and after the additional work is done, if in the opinion of the Assist-
ant Chief of Staif for Intelligence for the Department of the Army
the man should be granted access autliorizatiou, the case ends there.
If he does not feel that he wants to grant the access, the case then
comes to the review office in the Oflice of the Assistant Secretary of
Defense, and then the Screening Board may do more work. We may
iuterview the man. We may ask for still more investigation, and
in a large percentage of the cases, the Screening Board disposes of the
case favorably to the man.
Mr. DoTLE. Thank you very much.
Mr. JoHAXSEN. Mr. Chairman, may I make the observation that if
there were — and this is not said critically — but if there were a requisi-
tion for an employee or for a contractor on a hurry-up job, I suspect
there would be some time consumed in the process you have detailed.
Mr. Lewis. Yes, there is. The initial inquiries, at least through
the secret level, are primarily record checks, and they are accomplished
in a relatively short period of time. If the record checks develop
(]uestion_able information and the case has to be converted to field in-
vestigation, then a considerably longer period of time may result.
All of these people are already Avorking for the company at the
time the requests are initiated, so it isn't as if they were seeking em-
ployment at the time
Mr. JoHANSEX. But they are seeking assignment.
Mr. Lewis. Within the company, yes.
Mr. JoHANSEN. Now my question is a serious one in this respect,
that to what extent are you estopped from pushing this one person,
or this one contractor, aside due to delays inherent in resolving the
question, and substituting, if there is a factor of urgency ?
476 HEARINGS RELATING TO H.R. 10175
In other words, are we actually, in the process of our extreme cau-
tion to protect the rights and interests of the individual involved,
throwing a delaying factor into what may be an urgent timewise pro-
cedure or operation ?
Mr. Lewis. Well, if you are addressing your question, sir, to the
facility itself, I would say the answer is no. I have had no experience
that would demonstrate that any vital defense industry, or part of in-
dustry, was affected in its efforts to produce on a contract because of
the time factor in processing requests for individuals who would be
working for the company on a contract.
It is true that certain engineering personnel, as well as blue-collar
workers who might require access, individually would be delayed
in getting access if in the course of investigation we discovered suf-
ficiently derogatory information to warrant bringing the case all the
way up to the Office of the Assistant Secretary of Defense and proc-
essing it through the review program, yes sir.
Mr. ScHERER. And we are doing this in an instance where we are
dealing with a privilege rather than a basic right ?
Mr. Sk^vllerup. That is true.
Mr. Scherer. Legally, we would not be required to do it?
Mr. Skallerup. I would be reluctant to come to that conclusion
legally, Mr. Scherer. We are bending over backwards to be fair,
and they do get a fair hearing.
Mr. Scherer. Yes, I understand that. But when you do provide
them with cross-examination and confrontation, that is required, of
course, under the law when you are attempting to deprive a person of
a basic right, namely, when he is charged with a criminal offense and
he may be deprived of his liberty or fined. Then is when the law re-
quires confrontation and cross-examination; but certainly, if we come
to the conclusion that classified information, as counsel did, is not a
basic right — a person has no property right to it, it is only a pri^^lege
that the Govennnent extends to an individual to have that — then cer-
tainly he is not entitled to a confrontation or cross-examination. He
is not really entitled, except that you want to be fair in all of these
procedures set up, which Mr. Johansen pointed out may, in the long
run, affect the security of the United States.
Mr. Doyle. May I ask, Mr. MacClain? I think you used the term,
Mr. MacClain, describing the area in which a certificate could be made
properly by the Secretary, for reasons of death or serious illness?
Mr. MacClain. Yes, sir.
Mr. Doyle. And then you used the phrase "or some other reason."
Now are you in a position to tell me what other reasons would be con-
sidered comparable to death or serious illness to justify the circum-
Mr. MacClain. Mr. Doyle, those particular words are in the Execu-
tive Order and in our proposed revised bill.
Mr. Doyle. I notice they are, but they don't specify.
Mr. MacClain. The experience to date has not brought up a single
instance in which we would have to make a determination of the
meaning of those words "good and sufficient cause" as used in Section
4(a) (2) (B) of E.O. 10865, as applied to a particular case. We do
know that in this area there are some situations of a very high degree
of sensitivity from the standpoint of the information involved. And
HEARINGS RELATING TO H.R. 10175 477
we know that if we have that kind of case, and we have an informant
who would otherwise be available to us, but for a reason whicli at
this moment I really cannot describe, but to the head of the department
would seem good and sufficient reason as compared to this verj- high
degree of sensitivity, in that situation, sir, an attempt would be made
to resolve the meaning of those particular words.
Certainly, there is no intention to make use of those words as any —
in a manner of speaking — as any easy way out. It is going to be the
hardest possible way out, before we use them, sir.
Mr. Doyle. Counsel, do you want to proceed ?
Mr. NiTTLE. Yes, sir.
Now with respect to the procedures for personal appearance by ag-
grieved applicants set forth in H.R. 10175 and your draft bill, certainly
you do not regard these procedures as an admission in derogation of
the absolute right and power of the Executive to control access to
Mr. Bartimo. Mr. Nittle, I agree with the point you are making.
But we must keep in mind what Mr. Scherer has brought out, what
we from the Department of Defense have indicated as the necessity
and the philosophy and the reasons behind the procedures. But, cate-
gorically speaking, you are absolutel}' right.
Mr. Nittle. I believe that is the interpretation wdiich is to be placed
upon the statement in section 9 of your Executive Order 10865, which
reads as follows:
Nothing contained in this order shall be deemed to limit or affect the responsi-
bility and powers of the head of a department to deny or revoke access to a spe-
cific classification category if the security of the nation so requires.
Now, as a matter of fact, there are other powers involved here, are
there not? And I ask this question with respect to present procedure.
In Greene v. McElroij, by procedures then in effect, the Defense De-
partment entered into a specific contract with an industrial establish-
ment relating to personnel security matters. This was a contract
between two parties only, the employer and the Defense Depart-
ment, which provided, in fact, that the contractor shall exclude from
any part of its plants, factories, or sites at which work for any mili-
tary department is being performed, any person or persons whom the
Secretary of the military department concerned or his duly author-
ized representative, in the interest of security, may designate in writ-
ing. Greene was not a party to this contract, and acquired no legal
rights under it,
Mr. Bartimo. Mr. Nittle, I think that the point you are bringing
out is a very important one. I think this is a good point on the
record, for us to indicate that the Greene case, Greene v. MeEli'oy,
was based on a peculiar set of circumstances wdiich the Supreme Court
found to be present in that particular case. I would like to duote
here from a brief of the Government in Stephen L. Kreznar case, where
the Government on p. 12 stated :
The Greene case involved the revocation of a security clearance granted to
Greene, an aeronautical engineer employed by a company devoted primarily to
developing and manufacturing mechanical and electronic devices for the Armed
Services. He had been with the firm for over fifteen years, and had become
a chief executive oflBcer of the company. His work was of a specialized
nature, and could not be performed without access to classified Information.
478 HEARINGS RELATING TO H.R. 10175
When his clearance for access to such information was withdrawn, there
was no work for him to do and he was dischai'ged. He could not thereafter
obtain employment in the aeronautical field because of his lacli of security
clearance, and he was forced, to accept much lower paying work.
On that peculiar set of facts and circiimRtances, the Court evidently
concluded that this particular individual was being denied some
rights — the Court didn't specifically state what those rights were — the
Court was concerned by not having what it called a fair hearing
to determine whether or not the decision of the Department of Defense
It is interesting to note that the Court in the Brawner ^ case adhered
to the philosophy which you have expounded, and that is, that the
commanding officer of a Xaval installation had the authority to deny
access, ingress, egress, from that installation, without a hearing. So,
therefore, the courts, I think, are becoming cognizant of the point
you are making. I think, we ought to pin home the point that Greene
was a particular fact circumstance, and the Court, as I have indi-
cated earlier, in my judgment, was being statesmanlike in indicating
to us how we could improve our procedures under the American way,
giving a man a fair hearing,
Mr. SciiERER. But the Court did that, I think, on the false assump-
tion that Greene has a basic right to classified information.
Mr. Barttmo. Mr. Scherer, you may be right. I would diffei"
Mr. Scherer. I think it was a false assumption the Court acted
Mr. Bartimo. You may be right
Mr. Scherer. And that is the only way it could arrive at the
decision it did arrive at, assuming that he had a basic right rather
than, as you said a few minutes ago, a privilege.
Mr. Bartimo. You may be right in your interpretation. We have
had many interpretations of what the Greene v. McElroy case means.
I prefer, in charity and as a lawyer interested in the area, to construe
the case as the Supreme Coui't setting forth its judgment that our
procedures should be improved.
For example, the Court said that we had not the right in the absence
of an express authorization under an Executive Order or a statute to
run the industrial security program in the precise manner that we did
in that case. But the Court added, had it found that we gave a con-
frontation and cross-examination type of hearing, it would have deter-
mined that we had that right by implication. This to me was the
handwriting on the wall, the statesmanlike opinion of telling us to
improA'e our p]"ocedures, as T bf4ieve we have.
Mr. Scherer. The Court indicated, as you say and as I remember,
in the Greene case, that it might hold — even though the proper pro-
cedu'Ts wei'e set up or even though tlie Defense Department had
ihe delegation of autliorit}', either from the Congress or the President,
to set up these procedures — at a later time that this individual is en-
titled to confrontation. Didn't the Court hold that in that case?
Mr. Bartimo. I ])el ieve the majority o]:)inion did
Mr. Scherer. Entitled to cross-examination.
Mr. Bartimo. I believe the majority opinion did not go so far as to
make that judgment.
Mr. Scherer. But it said that some place in the opinion, didn't
it? One of the Justices said that?
1 Cafeteria and Restaurant Workers Union, Local 473, AFL-CIO v. McElroy, 367 U.S.
HEARINGS RELATING TO H.R. 10175 479
]\Ir. Baktimo. You may be correct, but I think in order to be com-
pletely responsive to your hypothesis on what Greene means, and 1
think that as i a^'ree with you tliat access to classihed information is
a privilege and not a right, you begin to get to what I call a gray
area. Under the fact situation of Greene, which was peculiar,
you begin to get into an area where the courts have said in other
cases you might unjustly stigmatize a good American because you
haven't given him a fair hearing. Where does that tine dividing line
come then ? I agree with you that access to classified mf ormation is
not a right, it is a privilege. But in adhering to certain procedures,
where do you stop ^ From the clear demarcation of a right and a priv-
ilege? And what of those elusive gray areas? Where do your pro-
cedures unjustly stigmatize?
I think this is what the Court was worried about. I believe that
the Executive Branch, the President's Executive Order, and the regu-
lations we prescribed would be wholeheartedly adhered to b}^ the
Supreme Court, should we get another case. I woukl hope so.
Mr. JoHANSEX. May I interject at that point, is it your belief that
under the Executive Order issued subsequent to Greene that in an
identical case — or tlie Greene case, had that existed prior to the
action in his case — the courts would hold that his denial of access
was a valid denial ?
Mr. Bartimo. I would say, Mr. Johansen — and I am sure you will
find better informed lawyers than I in this field who might disagree
with what I am about to say — it is my judgment that should the
Greene case, or a case similar to the Greene case, go before the
Supreme Court, having gone through the procedures we are now
operating with, the Supreme Court would hold that we have given him
a fair hearing. I believe the Supreme Court — and I would hope it
would — would commejid us for picking up what it considered a chal-
lenge for an improvement. I believe the Court would say : "You
have improved your procedures."
Mr. Johansen. May I now press the question one step further?
Assuming the hypothetical situation in which you have a Greene
case, completely identical with these existing procedures, and assum-
ing that in that case there was a determination, in consequence and
responsive to the rules and procedures and by the proper authority,
that there should not be confrontation and cross-examination, would
your belief as to the similar action standing up apply to that situation
as well ?
Mr. Bartimo. Mr. Johansen, again, with the same caveat that other
lawyers might disagree with me
Mr. Johansen. Well, I think the committee is not going to accept
Mr. Bartimo. It is my judgment, if we had a case where the Secre-
tary of Defense personally made the determination tliat this particular
individual is not entitled to access to our classified information and,
because of the sensitivity of the case, that he would make a fiat and
without procedures he would want to deny this individual access, that
the Supreme Court of the United States would uphold that.
I believe that this is a very rare type case. We haven't had one.
I would hope it would be a very de minimis type situation. But in
my judgment, in these perilous times in which we live, we must give
480 HEARINGS RELATING TO H.R. 10175
that authority to a key individual iii our Government, who has the
responsibility for running his agencj^. He must have that authority.
I believe the President has it. I believe it is legal for the President
to delegate it to his top official, in the Department of Defense, the
Secretary of Defense, and I would hope that the Supreme Court
would adhere to the views which we are expounding here this morn-
ing and find that legal.
Mr. JoHANSEN. Well, I am very happy and commend the gentleman
for the reference to these perilous times which include some internal
perils, as well as external, and I concur completely.
Mr. DoYLE. May I ask one further question ?
I have before me the Executive Order 10865, which is referred to on
page 6 of the statement this morning by the Secretary, and I call your
attention to section ?>, subdivision (1) of that. I am especially inter-
ested in subdivision (1). This apparently, as I read the order — it is
the first time I have had the pleasure of reading it — this is in the pre-
liminary stages of an inquiry, but unless I am in error in reading it —
and let me read it out loud — the Avritten statement of reasons why his
access authorization may be denied or revoked, I call your attention
to this clause, "which shall be as comprehensive and detailed as the
national security permits."
Now, am I in error that the person that gives that notice of that
decision is not the Secretary ?
Mr. Skallerup. In this instance, the case has come up through the
field organization, as Mr. Lewis described. It has come to the Screen-
ing Board, and the Screening Board has made its determination that
it cannot grant access. Therefore, the Screening Board prepares a
Statement of Reasons, setting forth the basis for coming to the conclu-
sion that the man should be denied access. The (juestion comes up :
How broad, how extensive should this Statement of Reasons be?
How far does the Screening Board have to go?"
The Executive Order states that it should be as comprehensive and
detailed as the national security permits, so that when the individual
who has been seeking access is notified for the first time that he is
not going to be given access, he is likewise notified in comprehensive
and detailed language — just as comprehensive and detailed as the
national security permits — precisely why he is not being granted ac-
cess. This happens at the Screening-Board level. This board is in
the Office of the Assistant Secretary of Defense.
After the individual receives this Statement of Reasons, he is per-
mitted to reply within a reasonable period of time to the statement,
under oath or affirmation ; and at that point, if he desires, a hearing
will be held in a field office — there are three of them in the United
States — and he will be permitted to bring in counsel, to bring in evi-
dence, to bring in witnesses, and with respect to those matters that are
controverted in his reply to the Statement of Reasons, he may cross-
examine the witnesses.
Mr. Doyle. This, in fact, becomes a preliuiinary foundation for
later action by the Secretary?
Mr. Skaleerup. Yes, sir; it is the first time that the picture is clari-
fied to the individual seeking access. He is given his Statement of
HEARINGS RELATING TO H.R. 10175 481
Mr. ScuERER. To which I don't think he is entitled, if what counsel
hero and I ai!:ree on is so, that this is only a privilege. In the sense of
American fair play, yes.
Mr. Doyle. I am not the Supreme Court, but I rather think, until
a person is proven to be a risk within the definitions before us, that
the person has some rights. I think a person has a right to be in-
formed. I don't regard that as a privilege, Mr. Scherer, I think
that what 3^011 are doing here, in subdivision (1) of section 3, is some
sort of a right of an American citizen.
Mr. JoHANSEN. Well, Mr. Chairman, I am sure, you will agree
that it is a relative right, at least to the extent that the Executive
Order and this proposed legislation vests an absolute right in the
head of the department to deny access in certain circumstances.
!Mr. Doyle. I don't question that for a minute, but up until the time
that there is a finding that the man is a risk and shouldn't have access,
I think in lay language he is an American citizen that is entitled to
know^ what the charges are against him. He has the right of counsel
at all times, under this directive, as I see it. Is that a privilege, or is
that a right ? The right of counsel under this Order.
Mr. Skallerup. If I might answer, part of the difficulty here, when
cases of this sort get into Court, as I see it, is in characterizing the
Now in the Greene case, the Court was concerned with a right, but
it was not speaking of the right which Mr. Scherer and Mr. JBartimo
were speaking about. The Court said that under the specific facts
before it in that case, this man has been, to use its own language, "de-
prived of the right to follow his chosen profession," and as a matter
of fact that was the consequence of denying him the security clearance
under those circumstances. So the Court said :
Before we are asked to judge whether, in the context of security clearance
cases, a person may be deprived of the right to follow his chosen profession with-
out full hearings where accusers nuay be confronted, it must be made clear that
the President or the Congress within their respective constitutional powers, spe-
cifically has decided that the imposed procedures are necessary and warranted
and has authorized their use.
"Well, when a case comes down the track to us, we are not sure just
how it will be characterized when it gets into Court, so considering
the interests of the individual and the Government, w^e are providing
these procedures, so that in the event the upshot is that the man, as in
Greene, is denied the right to follow his chosen })rofession, we wall at
least be doing it in a way which we believe is consistent with the way
set forth by the Supreme Court in the Greene case.
Mr. Doyle. Well, you are doing it to play safe, as you say — antici-
pating any possible future Supreme Court decision.
Mr. Scherer. Let us assume that I am an employer and have
owned, maybe under patents, a certain secret formula. I have
to have employees apply that formula in the manufacture of what-
ever conmiodity I am manufacturing. Suppose I have just reason
to believe that an employee is passing on this formula, or his con-
duct is such that he may pass on that formula to a competitor,
a secret fomiula which I own. Do I then, as a private employer, if
the reasoning of the Supreme Court is correct, have to set up some
482 HEARINGS RELATING TO H.R. 10175
kind of board, give liim a trial in a hearing, to deteraiine whether
I can fire him or not ?
I think the secrets of the United States whicli protect the security
of this Nation are more important, more vital, than this formula I
might have. How far are we going to carry this? How do you
Mr. Bartimo. May I make a comment ? And I would beg the in-
dulgence of the committee, and I say this in all humility, that seman-
tics is sometimes said to be a science, and I believe from what I have
heard, I think valuable discussion for legislative history^ that Mr.
Doyle is not apart from Mr. Scherer, and Mr, Scherer is not apart
from the Department of Defense.
Let us briefl}^ recapitulate. We start with the premise that access
to classified information is not a right of any individual. If it were,
we would reach ridiculous results. "We could have a person from
Russia who would become a citizen for the purpose of gaining access
and getting information and carting it home to Eussia. I think we
all agree that is a ridiculous result.
I think, as I have tried to indicate, that you have two principles
at stake here. One is the principle that Mr. Scherer propounds, in
which I agree, that having access to classified information is a priv-
ilege. It is up to the Executive Branch, that has the authority, that
is charged by the American people with protecting this sensitive in-
formation, all for the purpose of preserving our way of life, to deter-
mine that a person must be reliable, trustworthy, and adheres to our
fundamental concepts in our way of life.
Our procedures are geared to screen out those individuals which do
not meet this criterion, which I am sure we all agree to. Xow, how
do' we get what appears to be a cleavage, from what I understand
Mr. Doyle is saying, and from what I understand
Mr. Doyle. Now for the purposes of the record, I will stipulate to
that point. You and I and Mr. Scherer agree.
Now how about the other areas ?
Mr. Bartimo. Fine. The area where I think that there might be
a possible difference, and I would hope that it is a semantic difference,
is that where in the peculiar fact situation which we described, and
which was present in the Greene case, that you have a peculiar devia-
tion from what I think is the sense of the entire group that is here
this morning. I believe it comes from, under a particuhir fact situa-
tion, procedures which were then invoked by the Department of De-
fense, and an individual found himself in a most peculiar set of cir-
cumstances. I doubt if Ave will even get another case like it. That his
training, his background, equipped him so he could only earn a live-
lihood by working on defense contracts, which meant that he had to
have a clearance. The Supreme Court was concerned, I think, not
so much on the Greene case itself, but on the principle that you might
have made a mistake, that you might have denied a good citizen the
means of livelihood. The Court was probably going on to the theory
that the Executive Branch might possibly be stigmatizing a good
citizen. It was concerned about that.
As I have said, the Court indicated, I believe, in its opinion, a
statesmanlike approach, you should improve those procedures in
HEARINGS RELATING TO H.R. 10175 483
accordance with the American tradition. What is that tradition?
We have picked up the Court's challenge, and when I say "we," we
have had the aid of erudite attorneys like Mr. Walter Yeagley from
Justice, White Plouse attorneys, many attorneys throughout the Ex-
ecutive Branch, who have put their brains to work.
It took about 9 months of hard work to come up with the Executive
Oixler and the regulations, all to the end of meeting the challenge
of the Supreme Court, and always having in mind that we must use
procedures which protect the national security— that is the para-
mount issue. In my judgment, that paramount issue is set forth
specificallj'' in section 9 of the Order, which says that in a particular
set of circumiStances, where the Secretary of Defense personally de-
termines, because of the sensitivity of the situation, or the classified
information, he cannot go to a full-scale hearing, it is his judgment,
weio-hincr the value of the individual and national interests that this
^ ^ • • •
individual on his own say-so shall not have access. I think this is
in accord with our xVmerican tradition.
iNIr. SciiERER. Now I think we should show for the record, then,
what the evidence in the Greene case showed about Greene's back-
ground. I think it is important.
(Mr. Scherer, reading:)
During 1942 SUBJECT [Greene] was a member of the Washington Book Shop
Association, an organization that has been officially cited by the Attorney Gen-
eral of the United States as Communist and subversive.
SUBJECT'S first wife, Jean Hinton Greene, to whom he was married from
approximately December 1942 to approximately December 1947, was an ardent
Communist during the greater part of the period of the marriage.
During the period of SUBJECT'S first marriage he and his wife had many
Communist publications in their home, including the "Daily Worker" ; "Soviet
Russia Today" ; "In Fact" ; and Karl Marx's "Das Kapital."
Many apparently reliable witnesses have testified that during the period of
SUBJECT'S first marriage his personal political sympathies were in general ac-
cord with those of his wife, in that he was sympathetic towards Russia ; followed
the Communist Party "line" ; presented "fellow-traveller" arguments ; was appar-
ently influenced by "Jean's wild theories" ; etc. * * *
In about 1946 SUBJECT invested approximately $1,000 in tlie Metropolitan
Broadcasting Corporation and later became a director of its Radio Station
WQQW. It has been reliably reported that many of the stockholders of the
Corporation were Communists or pro-Communists and that the news coverage
and radio programs of Station WQQVv^ frequently paralleled the Communist
Party "line." * * *
On 7 April 1947 SUBJECT and his wife Jean attended the Third Annual Dinner
of the Southern Conference for Human Welfare, an organization that has been
officially cited as a Communist front. * * *
Beginning about 1942 and continuing for several years thereafter SUBJECT
maintained sympathetic associations with various officials of the Soviet Embassy,
including Major Constantine I. Ovchinnikov^ —
I can't pronounce his name — and a number of other top Communists.
I won't read on, but there are tendered specifications that get worse
as you go on.
]Mr. JoiiAxsEN. And is Mr. Greene now entitled
Mr. Scherer. Oh, he is entitled to classified information.
Mr. JoHANSEx. — entitled to access to classified information?
Mr. Bartimo. May I clarify the record on that? Greene does not
have access to classified information. The Supreme Court did not
484 HEARINGS RELATING TO H.R. 10175
order us to give him a clearance. The Supreme Court was very limited
in its decision, and this is one reason why I have constantly character-
ized this decision as a statesmanlike decision. Greene does not have
Mr. JoHANSEN. How was the denial of that access accomplished in
the face of the Court decision ?
Mr. Bartimo. The fact is tliat I don't believe the Supreme Court
wants the Greene decision to be construed as having one ami of our
three arms of Government telling another arm what it should manda-
torily do. It has set out some criteria, some guidelines, some prin-
ciples, which it believes should be followed. The Executive Branch
has followed that. The Supreme Court never has indicated that the
Executive Branch should give this individual access. The Supreme
Court never made that determination.
As Mr. Scherer pointed out, there is probably a lot of information
that would cause doubt in the Supreme Court's mind on this individ-
ual's ability to have access. All it was pointing out was that you
should give this man, in accordance with our American tradition, a
fair hearing. And this is what we seek to do.
If Greene came in today — if I may add this — and asked for access,
we would give him these procedures.
Mr. Scherer. But didn't the Supreme Court in the Greene case, by
its decision, hold that he was illegally deprived of access?
Mr. Bartimo. I believe that the Court held
Mr. Scherer. That was the basis of the decision. That was the
Mr. Bartimo. But having arrived at that, it does not necessarily
follow that we should give him access. I don't believe that follows.
Mr. Scherer. Well, what actually happened in the Greene case,
Mr. Bartimo. What happened in the Greene case ?
Mr. Scherer. Yes.
Mr. Bartimo. The order that was written — and I don't have it.
Do we have it with us ?
Mr. MacClain participated in writing the order that implemented
the Greene decision, and I believe he can straighten out your point,
Mr. DoTLE. Now, in view of the fact that I referred to section 3,
subdivision (1), and I asked a question, what sort of a right an
applicant has — I stipulated, and I believe that certainly we are all
agreed, that the Government has an absolute right to withhold
any information wherein the national security is involved — but
referring here again to subdivision (1), section 3, what right, if any —
I think that was my wording — what right, if any, does a man have, in
the first part of that section, or does he have a right? Is it a privilege,
or is it a right, to be notified of what the complaint is? Is that a
privilege that a man has ? Is that all he has, or doesn't he have a right
to be notified of anything that doesn't involve the national security?
Or am I in error ?
Mr. Bartimo. Mr. Doyle, I think that what you are saying, as far
as you are going, and what I believe you have in mind, you could
characterize that as a right. However, we cannot take that and sep-
HEARINGS RELATING TO H.R. 10175 485
arate it from the whole ball of wax. As I have tried to indicate, and
I believe that both Mr. Scherer
Mr, Doyle. I can see that, but you yourself said there was a line
of cleavage some place.
]Mr, Bartimo. Yes.
Mr. DoTLE. Xow where is that line of cleavage? Is it the line that
you draw here in subdivision (1), section 3? Because there is a line
of cleavage drawn there.
Mr. Bartimo. No, I don't believe that is where I suggested that
we might draw a line of cleavage. I think that if we just reiterate
one or two points, and hope to clarify your point, which I think is a
valuable point, we have agreed, and I believe you said so, Mr. Chair-
man, that section 9, which gives the Secretary of Defense the right,
without regard to any hearings, to deny an individual, is a legal
Did I understand you clearly ?
Mr. DoYi^E. That is right.
]Mr. Bartiimo. Now if that is correct, then it seems to me we are
agreed with Mr. Scherer and Mr. Johansen, that so far, we are in
agreement. Is that correct ?
Now, then, where does the cleavage come? This word "cleavage'"?
I believe it comes where in the peculiar fact situation of Greene, this
individual, peculiarly trained and equipped to work and make a liveli-
hood in an industry which is monopolized by the defense contracts,
which were classified — this was in effect what the Court, said — where
you had that peculiar situation, and you did not have what the Court
termed a confrontation or a cross-examination type procedure, the
Court found — and this is wdiat it fomid — that the Department of De-
fense did not have authority to rmi this type of a procedure, either by
the President or by the Congress, and this is all it found.
Now in trying to answer your question, on Mr. Scherer's point.
The Supreme Court decision has been implemented to the effect that
the record, so far as the final determination in Greene, is expunged.
Therefore, you do not have on the record that Greene has been denied
access. This doesn't necessarily, ij^so focto^ give him access.
For example — and I believe this point is very significant, and Mr.
Doyle touched upon it — let's take a hypothetical case of a person
who has been cleared in our program, and we suddenly come across
information that this man is a saboteur planted in that particu-
lar industry by the Communists. We had not screened this, nor had
we learned it in our investigative procedures. We have the right to
immediately suspend tliis man from access to classified information so
that he cannot do harm, without regard to procedures.
We would then give him a Statement of Reasons, setting forth our
jud^nent of why we believe he is a saboteur, on the basis of the infor-
mation available to us. Then he may take advantage of our pro-
I believe, having that in mind, sir, I would welcome your judgment,
that we have clarified the air about what we consider a priialege on
the one hand, and a right on the other. I believe it reduces itself to
semantics, but I believe men of good will, discussing these points, will
arrive at what seems to me a logical solution, one which is necessary
for us to protect our way of life.
486 HEARINGS RELATING TO H.R. 10175
Mr. JoHANSEN. Mr. Chairman, I still want to pursue one question.
It may have been my lack of comprehension. Is Greene today de-
prived of his livelihood because he has not access to classified infonna-
tion? And if so, by what means— was it under this Executive Order,
or by what means — did tlie Defense Department, subsequent to the
Court's decision, deprive him of that access, or fail to grant him that
Mr. Tavenner. May I interrupt a moment ?
Mr. DoTLE. T>/et us suspend for a few minutes.
Mr. JoHANSEN. I do want to have the record show the answer
to that question before we go.
Mr. ScHERER. Let me ask this. Didn't the Greene case finally deter-
mine that this man was improperly deprived of access to classified
Mr. Bartimo. It did not. The Supreme Court opinion in my judg-
ment did not reach that issue.
Mr. JoHANSEN. Well, what was the practical effect of it vis-a-vis
Mr. Barttmo. The practical effect of the Greene decision was for
us to pragmatically institute procedures which were in keepinsr with
the Supreme Court opinion — I beg your indulgence on this if I am
being repetitious — and the Court did not say that we have to give
Now as to your question about what has happened to Greene since.
I haven't followed Greene's career. I don't know what occupation
he is engaged in, if any; but, nevertheless, I think the record ought to
be clear that if Greene feels a necessity to have access to classified
information, and wants to submit himself to our procedures, they are
Mr. ScHERER. He had it at the time. He had access to information,
and the Greene case was to deprive him of it. He wasn't asking for
it. He had it.
Mr. MacClain. Ma v I make a statement to clarify this ?
Mr. Bartimo. Mr. MacClain, I believe, might add here, Mr. Chair-
Mr. MacClain. Prior to the time when the Greene case reached the
Supreme Court, there had been a series of actions in his case taken by
the Department of Defense at one level or another. He had been
deprived of the right of further access, long before his case ever
reached the Supreme Court.
Mr. ScHERER. That is right.
Mr. MacClain. As a result of the Supreme Court decision in that
case, which didn't pass in any respect upon his eligibility for access in
my judgment, the Court said that "the procedure that you used in the
final analysis to pass upon this man's eligibility lacked authorization.
The final result vou I'eached, based upon this particular procedure,
lacks validity. "Wipe that out.'' We did. He is restored, then, to the
position he occupied before that.
Mr. ScTiERER. Entitled to access?
Mr. MacClain. No, sir, not entitled. The action of the Secretary of
the Navy, in notifying his employers to remove him from a position
of access Avas, as we see it under the circumstances of his case, a sus-
HEARINGS RELATING TO H.R. 10175 487
pension type of action, and it has been and is onr view tliat the Greene
case does not reaeli a suspension type of exercise of authority by the
Department of Defense. It is just as ^Ir. Doyle brought out and as
the Secretary and Mr. Bartinio have brought out. Preliminary to
this final action which was inider the review of the Supreme Court,
there had been preliminary actions, a suspension, an issuance of a
Statement of Reasons, and an opportunity to go forward to a final
type of personal appearance proceeding. This is what happened in
his case, and as a result of the personal appearance proceeding which
we gave to him, the Supreme Court found us in error, but they didn't
go back, in our view, and undercut the preliminary actions that had
been taken, and which were still in effect.
Mr. ScHERER. You sa}' that Greene, then, didn't retain his right to
classified information ?
Mr. MacClaiint. Oh, no, sir. The present situation is that, as far as
he is concerned, on the books of the Department of Defense, the pre-
liminary suspension as against him is still in effect. It has never been
disturbed. The Court order that was entered pursuant to the Greene
decision said that the final action taken in his case, and any proceed-
ings based on that final action, are to be expunged as invalid. It
did not reach any preliminary action whatsoever, and it was these
preliminary actions which separated him from actual access, and
that is where he is today.
Mr. JoHANSEN. Then he won, in terms of gaining or regaining access
to classified information, a completely meaningless victory?
Mr. Skallerup. That is right.
Mr. Bartimo. A Pyrrhic victory, if you will.
Mr. JoHANSEivr. So that he does not as of now and has not since
the decision had access ?
Mr. MacClain. That is right, sir.
Mr. Doyle. Well, we will have to go to the Floor. We will be back
again in about 15 minutes.
The committee will stand in recess.
Mr. Tavenner. I suggest, sir, that we take more time now for lunch
and come back at a quarter of two.
(AVliereupon, at 12:50 p.m., Thursday, March 15, 1962, the commit-
tee was recessed to be reconvened at 1 :45 p.m. of the same day.)
488 HEARINGS RELATING TO H.R. 10175
AFTERNOON SESSION— THURSDAY, MARCH 15, 1962
(The hearings were reconvened at 2 p.m., Mr. Doyle presiding.)
(Present also were Representatives Scherer, Johansen, Bruce, and
Mr. Doyle. Let the meeting come to order, and we will proceed,
Mr. JoiiANSEN. Mr. Chairman, I wonder if at tliis point I might
direct a question to committee counsel.
Mr. Doyle. Certainly.
Mr. JoiiANSEN. I wonder, because there were some questions that
were raised near the close of the morning session, whether you would
very briefly highlight the issues, or more specifically the relief which
Greene sought in his case, and also the decrees of the court, the Su-
preme Court to the low^er courts, that emanated from the Supreme
Mr. NiTTLE. I have before me the Supreme Court report of the case
of Greene v. McElroy. In the o])inion. Chief Justice Warren recites
the facts and the relief sought by Greene in that case.
Mr. Scherer. What was the relief he sought ?
Mr. NiTTLE. He said this: After the Security Board decision in
1954, the petitioner — that is Greene — "filed a complaint in the United
States District Court for the District of Columbia asking for a decla-
ration that the revocation," that is, revocation of security clearance,
"was imlawful and void and for an order restraining respondents from
acting pursuant to it. He also asked for an order requiring respond-
ents to advise" the employer "that the clearance revocation was void."
The Government filed a bill for dismissal of the complaint and for
summary judgment, alleging presumably that there was no cause of
action, and tlie district court granted the Government's motion for
On appeal to the United States Supreme Court, the fuial order is
recited as follows: "Accordingly, the judgment is reversed and the
case is remanded to the district court for proceedings not inconsistent
That is all that appears from the decision, but the assumption would
seem to be that the district court was now obliged to enter a judgment
to the effect that the revocation of security clearance was unlawful
and void, to advise the employer of that fact, and restraining the
respondents from acting pursuant to it.
Mr. ScTiERER. That is the way T read the decision.
Mr. NiTTLE. As a matter of fact, after the findings of the Security
Board, it appears from the recital of the facts in the case that Greene
was forced to resign from the offices lie lield in the corporation. I
think he was vice president.
Mr. Walsti. And he was also discliai-ged from his employment by
the employer. That was the ])osture of the case.
Mr. JoiiANSEN, You mean this was prior to the appeal ?
Mr. NiTTLE. Yes. He had resigned his offices and was discharged.
Mr. Johansen. And this was in consequence of the Government's
refusal to grant him clearance?
Mr. NiTTLE. Yes, sir,
HEARINGS RELATING TO H.R. 10175 489
Now, I think this may be relevant to a clear understanding of the
case : The Government seems to have acted entirely reasonably in its
handling" of the Greene case.
It forwarded to liim a letter of charges and specifically set forth
those matters of which it complained, and gave him an opportunity to
respond. The Government also offered Greene an opportunity to pre-
sent his witnesses; but the Government did not give him an opportu-
nity fully to cross-examine or be confronted with all the witnesses
agamst hnn, and indicated that it acted to a degree upon certain con-
Mr. ScHERER. May I interrupt? The District Court held with
the Government. The Circuit Court of Appeals affirmed. And the
Supreme Court, when we get into this social consideration
Mr. JoHANSEx. I take it the gentleman does not think the Supreme
Court acted in a statesmanlike fashion.
Mr. ScHERER. Oh, I think it did not follow the basic law, as I was
taught it in law school.
Mr. NiTTLE. Certainly, the case presents one of the complex prob-
lems in the science of jurisprudence. It is something that has been
troubling theorists for a long time.
Apparently the Supreme Court treated this matter as a case involv-
ing competing and perhaps conflicting interests and principles. The
logic of the law pointed up but did not resolve the conflict. The Court
then engaged in a balancing act — and suggested a sort of compromise.
Mr. JoHANSEN. May I come directly to the point? Since the Su-
preme Court's decree involved the issuance, as I understand it, by the
lower court of an order restraining the Government from acting pur-
suant to its previous finding or ruling, what was the result of the
matter; since the issue at stake seemed to be the restoration of em-
ployment, what was the result of tlie matter ?
Mr. NiTTLE. That does not appear from the case. The report of
the case indicates only that the case was remanded to the District
Court with orders to issue a decree in accordance with the decision.
Mr. JoiiAXSEN. I wonder if counsel can tell us whether such an
order was issued, and what the consequences of it were, in terms of
the status of Mr. Greene subsequent to his victory in the Supreme
Mr. Skallerup. Mr. MacClain can answer.
Mr. MacClain. The order was issued by the consent of both sides.
The order directed itself against that portion of the proceedings in
Vv-hich Mr. Greene had been involved, which related to his having a
personal appearance proceeding on the basis of which the final deci-
sion was entered revoking his access authorization, aud the order
declared that by virtue of the decision in the Supreme Court, the
final action of revocation, which had been based on this particular
personal appearance proceeding, was unauthorized, and therefore
illegal and void, and was ordered and directed to be expunged.
Here is a copy of the order.
Mr. Doyle. The order may be made a part of the record.
490 HEARINGS RELATING TO H.R. 10175
( The order follows : )
2i THE USITSP aS'AS'^S i;..SIi^^C7r CAS?
7m THE DISSRiCf €F CQIijmZk.
■y« : • Clril Acrtiaa File !io, 5;---.-
H D S H
i^<m tbe decision af tbe Ujiit«d Stetes Supfresje sJossrt in
this case C Oreega v. H cglro g;^ 3oC U.S. ^72;-) aad tla copy of
ibe Ju3®ssi!« a?sd, opiaiosi of tlse Suaress Qaart l^eretofos^ filed
•wltli thft clerk of this Court; aad
It «j^)e«riog tiist couasei fear tie respective parties hsre
coaiseste<i bereto, it is berefey
OSEiSESS that tte actioa of tlK Secretsry of Defease aisd
Ms ^oSxsrdiEates ia fljsaily rercskiog plaintiff 'e security
clearacsce w»s aad tJse eaae is berel>y declared to fee oot v^lidi^
swfcaorized; aai it is ftsrther
CiaaSS© tbat aoy or all rullE^, orders, or detsngissticsss
vtereln or ybfcTQljy plaintiff 'e secoritj dearacce vas revo&sA are
hesxttby azmalled aad ex^siioged frae all records of the GcveruEjeat
of the Uiaited States.
D&ted: • ' ^' , 1959
i' L- t- ■
Itoited States District Judge
Attoruey for r>2fe2daats
Attarasy for Plaintiff
HEARINGS RELATING TO H.R. 10175 491
Mr. JoHANSEN. Well, now, with the simplicity of a nonlegal mind,
does tliat mean : Did he ^ct his job back ? Or didn't he ?
Mr. MacClain. I would answer your question in at least two steps.
Mr. JoHANSEN. Can you not answer that Yes or No ?
Mr. MacClain. We were not concerned with whether he got his
job back in the sense that we could put him back in it, because we
could not. We had not directed his discharge, and we could not put
him back in his job, either one or the other.
As a matter of fact, according to information that I think is in the
record before the Supreme Court, he never did return to the job that
he had held prior to the time of this action.
Mr. ScHERER. May I interrupt there? Under the Supreme Court
decision, he would have the right, as I understand it, to return to his
Mr. MacClain. Sir, the language of the Supreme Court did talk
about a job, a profession, employment, and that kind of thing. But
the total effort of the Department of Defense was never directed
toward his having or not having a job or employment or following
his profession. It was directed to the single problem of whether he
could have access or not.
Mr. ScHERER. I understand that. The result was the deprivation
of a job.
Mr. MacClain. The practical result was that his job was
Mr. JoHANSEN. Did not the Court go even further, and did it not
say that the effect of the finding of tlie Government and the action of
the Defense Department — that the actual effect of it — was to deprive
him of his means of livelihood, not just this job, but the livelihood
based on the career for which he had been professionally trained?
_Mr. MacClain. Well, sir, I do not disagree with what you have
said, and I think words to that effect can be found in the Supreme
Court decision. From the point of view of the Department, we were
concerned with whether this man would or would not have access
to classified information in one job or any other job, in one profession
or any other profession. And the practical result of what happened
to him may be looked at as the practical result. The objective that
we had in mind M'as something else.
Mr. ScHERER. The question is, then, that you go back one step and
say: Was not the result of the Supreme Court decision that the man
was entitled to have classified information?
Mr. :MacClain. In our judgment, the answer to that question, sir.
Mr. Bartimo. JNIay I read for the record the pertinent part of the
decision? I read toward the end of the decision. I quote. And
this is the majority view :
In the instant case, petitioner's work opportunities have been severely
limited on the basis of a fact determination rendered after a hearing which
failed to comport with our traditional ideas of fair procedure. The type
of hearing was the product of administrative decision not explicitly author-
ized by either Congress or the President. Whether those procedures under
the circumstances comport with the Constitution we do not decide. Nor do
we decide whether the President has inherent authority to create such a
program, whether congressional action is necessary, or what the limits on
executive or legislative authority may be. We decide only that in the ab-
492 HEARINGS RELATING TO H.R. 10175
sence of explicit authorization from either the President or Congress the
respondents were not empowered to deprive petitioner of his job, in a pro-
ceeding in which he was not afforded the safeguards of confrontation and
Accordingly, the judgment is reversed and the case is remanded to the
District Court for proceedings not inconsistent herewith.
And we have attempted to explain that the court order in the Dis-
trict Court, which was agreed to by counsel for Greene and the Gov-
ernment, was not inconsistent with the views I have just read you.
Mr. JoHANSEx. Has Greene— subsequent to this decision, in any
way sought, by reason of any employment that he subsequently ac-
quired, whether it was a result or not a result of this decision — has
Greene at any time since this decision sought clearance for access to
classified information ?
Mr. ScHERER. He did not have to seek clearance. He had it. And
this decision prevented the Government from taking it away from him.
Mr. JoHANSEisr. All right. Has he had any employment under
which he exercised the right alleged and ruled by the Supreme Court ?
Mr. Bartimo. I think I can help, here. Xumber one: To our
knowledge, Greene has not sought employment within the United
States which would necessitate access to classified information.
Mr. Scherer. May I interrupt you there, counsel ?
Mr. Bartimo. Yes, sir.
Mr. Scherer. If he did seek that, you could not deprive him of it,
could you ?
Mr. Bartimo. My answer to that is : Yes, w^e could deprive him of
it. We would offer him
Mr. Scherer. Under this decision ?
• Mr. Bartimo. Under this decision. The Supreme Court has not —
and if I may emphasize not — required the Executive Branch, the Gov-
ernment, to give him access to classified information. That is not
what the opinion stands for, in our judgment. It is also the judgment,
evidently, of his counsel, because he has not pressed us on that issue.
I think it is further fortified from the order issued by the District
Mr. Scherer. I cannot follow.
Mr. Johansen. I would like to hear counsel proceed. I think he
was going to make a couple of other points.
Mr. Bartimo. Yes.
On your point, Mr. Johansen, I think it is a little complex, and
if you will bear with me for just a minute, I will try and explain it.
Under our procedures, as I illustrated by my hypothetical point
this morning, where a man is cleared in industry through our pro-
cedures, and we finally discover he is a saboteur in the employ of a
Communist oligarchy, we do not have to give him procedures. We
can suspend him forthwith from access to classified information. We
can pick up the telephone and do it immediately, to get him out of
our classified area.
Now, let us assume that we have made a mistake. At this juncture,
what has happened to this hypothetical individual ? He has been sus-
pended. That is in accordance with our procedures, and it is perfectly
legal. The Supreme Court has not challenged us on this.
I would think the Supreme Court would agree that in carrying
out our responsibilities to protect classified information we must have
HEARINGS RELATING TO H.R. 10175 493
the authority to suspend ;i known saboteur when sucli information
comes to us without waiting months to decide. I do not tliink the
Supreme Court ^^■ould ever deny tliat right.
Having that point in mind, then you go to tlie next issue. This man
has been denied access. He lias been suspended.
Mr. ScHERER. Pardon me. Is that what you did in the Greene
Mr. Bartimo. Yes, sir, w^e did that in the Greene case. The Sec-
retary of the Navy, under tlie old procedures, suspended him. And
just to pin home that point, Mr. Scherer, the Court decision did not
affect our right to suspend. This issue was brought to a head during
the District Court order in the Greene case.
Then the nest step from the suspension is the so-called final deter-
mination. The final determination comes about after the procedure
has been instituted. Before Greene when, as you know the procedures
were a little different than they are now, as has been explained, where
he got a full Statement of Reasons, wdiere we considered the utmost
that we could give him without affecting the national security.
True, as counsel has read, there were classified matters which Ave
could not give him. But the Supreme Court issue went, I think, on a
very narrow issue. It was a peculiar fact situation, as we explained
this morning. It was a narrow holding.
And yet, in all due respect to Mr. Johansen, I think the Supreme
Court was trying to be helpful. It was trymg to point the way
out to us, without meeting the constitutional issue, a method by which
we could give a fair hearing and be within constitutional, legal
This I think we have done. This bill which you have before you
would buttress what the Executive Branch has done by Executive
Order and regulations, and, in my judgment, if another case similar
to Greene's ever got before the Court, the Court woidd, I hope, give us
an accolade that we have picked up its suggestions and now have
proceedings which are fair and in the American tradition.
Mr. Scherer. Why, then, did not Greene attack the suspension?
Mr. Bartimo. I cannot answer you why Greene has not attacked
Mr. Scherer. Did not the decision entitle him, then, to another
hearing on the suspension ?
Mr. Bartimo. Yes, And as Mr. George MacClain has just indi-
cated by a note handed to me, we did actually offer Greene a proceed-
ing, and he has not accepted it.
Mr. Johansen. Now, what would that proceeding constitute or
Mr. Bartimo. The proceeding would constitute something like this,
Mr. Johansen. If Greene came in to us and asked for a hearing, an
appraisal of him as an individual as to whether he should have access
to classified information would be made. We would bring his case
up to date by investigation, at which time our experts, some of whom
are here this morning, would set forth a Statement of Reasons as to
why Greene should be denied access. He would have an opportunity,
through counsel, with the aid of counsel, to answer our allegations, our
Sta^^ement of Reasons, as to why we believe he should not have access.
Once these answers are in, they are reviewed for compliance with
requirements as to form and sufficiency. If these requirements are
494 HEARINGS RELATING TO H.R. 10175
met, he has a right to a full scale personal appearance proceeding
under the procedures described this morning. Thereafter, a final de-
termination would be made.
Mr. JoHANSEN. And that procedure, then, would involve the right
of confrontation and cross-examination?
Mr. Bartimo. Under these procedures. And as 3^ou know, as Mr.
MacClain and the Secretary explained this morning, we have certain
caveats in our procedures ; one dealing with the so-called confidential
If it is a judgment of Mr. Hoover of the FBI and the Department
of Justice, then this must be made by the Attorney General himself.
If to reveal this confidential informer would be detrimental to our
national security, the Attorney General issues a certificate to this
By means of this procedure, the Government is entitled to use this
evidence in appraising this particular individual. In such a case, as
was pointed out this morning, the determination, the final judgment,
must be made by the head of the Department concerned, in this case
the Secretary of Defense.
Mr. JoHANSEN. May I ask one final question?
Possibly this is irrelevant, but under the situation you have de-
scribed, and as I understand it, he is not now in Government service
or in employment for a contractor involving Government contracts
and involving classified information.
Precisely what was won for Greene in this decision ? And I suppose
there were some fairly ample legal fees.
Mr. Bartimo. I think he won two thinixs, if you can say he won.
The record was expunged, so far as the Government was concerned,
with respect to the final determination made before the new pro-
Number two : He has earned a right or a privilege, whichever you
will, to <TO before the Court of Claims, and ask for money damao-es.
Mr. MacClain. I want to explain that Mr. Greene has not filed an
action in the Court of Claims. Mr. Greene has been informed by the
Department of Defense that at any time that he wishes, we will give
him a proceeding under our present directive, under the Executive
Order; and pfter that has been completed, we will give full considera-
tion to any claim he may wish to file administratively.
If it should happen, as the result of these further proceedings, that
he again is finallv denied access authorization, we would not entertain
his claim: but if he should win, and be determined currently eligible,
we would then, if he filed a claim, address ourselves directly to the
question of his entitlement to money.
Mr. JoHANSEN. HoAv recently was that notification given to him?
Would vou recall ?
Mr. MacClain. Mr. Greene was notified almost directly after the
issuance of our new regulation, last July, that this procedure was
available to him, but even before that time, he was informed that as
soon as we had a regulation, we would c'ive him this opportunity.
Mr. JoHANSEN. Is there any terminal date to that offer?
]\fr. MacClain. No, sir.
Mr. JoHANSEN. They are necessarily open-ended?
Mr. MacClain. That is riffht. Right now it is in his hands com-
pletely, and there is no cut-off date that I know of at all.
HEARINGS RELATING TO H.R. 10175 495
Mr. NiTTLE. Slioiild you not provide in the regulations for some
cut-otT date? After all, if too many years pass hy, you may be handi-
capped ill the presentation of your case, oi' evidence. Your witnesses
may die, or they may go overseas, or sometliing may occur. The
memory may become dull. AVould it not be wise to make some pro-
vision in the regulations for a cut-off date ?
Mr. Skallerui'. The regulations should contain some kind of pro-
vision relating to cutoff dates. Whether it would be put in terms of
particular date, or particular time after the final judgment has been
made, or whether it would be i^ut in terms of "show cause why you have
not filed sooner," or put on the merits, we just cannot say now, but
certainly it would be a veiy important part of any regulation dealing
Mr. JoHANSEN. Does the Defense Department's offer preclude his
initiating action in the Court of Claims, if he elects to take that
Mr. Skallerup. That is a difficult legal issue.
Mr. JoHANSEN. I will withdraw it.
Mr. MacCl.\in. I would like to explain that it is always a matter
of choice with Mr. Greene where he should go for his relief. And
1 am sure he would make a decision whether to go to the Court of
Claims or not. But there are others who have gone to the Court of
Claims, and their cases are pending there now. Not one of them has
yet been decided. But in the two or three cases in which District
Court orders were entered after Greene, none of the pei-sons who had
gone to the Court of Claims has obtained from the Department of
Defense a determination of present eligibility.
And it is our position that until they at least have done that, they
have no standing in the Court of Claims. Mr. Greene is up against
that same proposition. We would assert it, I am sure, if he filed now.
Mr. JoHANSEN. 1 want to expi-ess my ap})i'eciation to the three gen-
tlemen for your patience in getting me finally to understand the pic-
ture; and I appreciate my colleagues' patience.
Mr, Bartimo. I think, Mr. Johansen, this has been a valuable dis-
cussion from the point of view of legislative history.
Mr. JoHANSEx. I think it contributes directly.
Mr. Doyle. Counsel, are you ready to interrogate?
Mr. NiTTLE. Yes, sir.
You have, Mr. Skallerup, given a very fine summary of your ex-
perience under this personnel security program, and j^ou have dis-
cussed the question of the number of people who have been affected
by personnel security procedures over some years past.
Since the adoption of Executive Order 10S65, could you tell us
specifically how many persons have in fact been deprived of employ-
ment in a particular defense industry who would otherwise have re-
mained so employed except for the operation of these proceedings?
Mr. Skallerup. We have no information at all which would provide
a basis for an answer to that quCvStion.
Mr. NiTTLE. Do you have an estimate ?
Mr. Skallerup. It would be most difficult to estimate, and perhaps
I could explain why.
It is conceivable that in some instances, where individuals who have
been denied access as a result of a complete hearing, have lost their em-
496 HEARINGS RELATING TO H.K. 10175
ployment. It is conceivable tluit in instances where individuals have
been suspended from access and have chosen not to go forward with
the proceeding, they may have left their employment. It is also pos-
sible that in some instances, in cases where these proceedings arise in
the course of the man's probation period, he might be considered by
his employer not the kind of person he would want to continue in
permanent employment, and for that reason that person might lose
Mr. NiTTLE. Your statement discloses that under the present 1960
program you have had 800 cases which have come under the review
program. Would that not indicate that there are at most less than
800 persons in the past two years who could have been deprived of em-
ployment as a result of the operation of these procedures?
Mr. Skallerup. Mr. Lewis reminds me that the 800 figure is the
figure of total cases which have come into the industrial review pro-
gram, and that of the 800 — in answering your question, it would be a
figure quite a bit short of 800, if all of those who had been denied
were denied employment.
But I would like to point out that this denial of access is not ipso
facto a denial of employment. It is a denial of access to information
that is classified, and in some firms, where a small proportion of the
employees are engaged in classified work, if the employer wants to
continue using the services of that individual, he could use him in
another part of the plant, where unclassified work is performed.
Mr. NiTTLE. Yes. I think it important that you point out on the
record, as you have done, that a denial of access to classified informa-
tion does not necessarily result in a denial of other employment within
the same industry.
Mr. JoHANSEN. It is not an automatic result, in other words.
Mr. Skallerup. That is correct.
Mr. NiTTLE. Then at least we do have for the record a statement
that there could not have been more than an average of 400 per year
who would have been deprived of employment as a result of the
operation of these procedures.
Mr. Skallerup. Mr. Lewis has come prepared with some figures,
and I hope that his figures will result in a total which would reduce
that 400 appreciably.
Mr. NiTTLE. Yes. I was, of course, taking an upper limit. If there
are only 800 security cases since 1960, and assuming that all of these
persons were actually deprived of employment, the average figure at
most would be 400 per year. And in the context of the operation of
such a vast and important program, it seems that the number of indi-
viduals affected is very, very small in contrast with the importance
of the program and the extent of its operation.
Mr. Lewis. The Secretary this morning said that there were a total
of approximately 800 cases since the activation of the new program
on July 28th, 1960.
To begin with, 800 of those cases are still unresolved. Of the re-
maining 500, there were final denials of only 118. So the raw figure
of possible losses of employment based on a final denial is 118; and
since the Department of Defense policy, the public policy, is that the
loss or denial of authorization does not require the contractor to termi-
nate the employment of the individual, we have no reason to believe
HEARINGS RELATING TO H.R. 10175 497
that all of these 118 lost their jobs as a result of the denial. Some
figure under 118.
Mr. NiTTLE. So may the committee conclude, under those circum-
stances, that great care is obviously exercised by the Secretary of De-
fense to see that the employment of the individual is reasonably main-
tained, consistently with the national interest ?
Mr. Skallerup. That is true, sir.
Mr. NiTTLE. Perhaps we should state for the record that H.R. 10175
is intended to authorize the Secretary of Defense to provide regula-
tions covering the entire range of security problems involved in the
handling of classified information, and is not to be considered limited
solely to subversive activities. It is also clear from the statements sub-
mitted by the Defense Department today that that has likewise been
the objective of your draft bill.
Now, would you briefly summarize the area of security factors which
are now specifically covered in existing regulations? That is, the
basic principles upon which you grant or deny clearance.
Mr. Skalleeup. The criteria ?
]Mr. NiTTLE. Yes.
Mr. Skallerup. They are set forth in our regulation, and they
appear in Department of Defense Directive No. 5220.6, dated July
28th, 1960, under Paragraph III, a copy of which was entered into the
record. It appears at page 10 of the directive. And it sets forth the
standard for issuing an access authorization, and then in detail de-
scribes the criteria for application of the standard in cases involving
There are 21 criteria set forth under Paragraph III of the direc-
tive which has been entered into the record.
Mr. NiTTLE. Since the entire document has been entered in the rec-
ord, your specific reference to that paragraph will be sufficient.
Mr. Doyle. Is there any item or criteria that you wish you had in
Mr. Bruce. Under 5, one of the criteria is "Intentional, unauthor-
ized disclosure to any person of classified information, * * *"
What if a man made it unintentionally ? Suppose, I mean, he was
n.aive about it?
Mr. Skallerup. You mean careless or reckless in handling classified
Mr. Bruce. Yes.
Mr. Skallerut. I believe that appears under Criterion 17, "Acts of
a reckless, irresponsible or wanton nature which indicate such poor
judgment and instability as to suggest that the individual might dis-
close classified information to unauthorized persons."*
Mr. Walsh. What page is that ?
Mr. Skallerup. This is page 12.
And 13, 1 would point out — "Willful violation or disregard of secu-
rity regulations." And 14, "Any behavior, activities, or associations
which tend to show that the individual is not reliable or trustworthy."
Mr. ScHERER. Mr. Chairman, I would like to be excused. Another
coimnittee needs one more member to make a quorum, so that they can
vote on a resolution.
Mr. Tavenner. Will you be back shortly ? We are putting you on
498 HEARINGS RELATING TO H.R. 10175
Mr. ScHERER. About what time?
Mr. Ta\'enner. I am hopeful that we could reach it about 3 :30.
(Mr. Scherer left the hearing room.)
Mr. Doyle. May I renew my question to the Secretary: Based
upon your experience as to these 21 criteria, have you by experience
found that you omitted something that you wished to put in there?
If so, what?
Mr. Skallerup. There is one consideration which we are consider-
ing adding to this list of criteria. It relates to the willful failure to
reply to official questions. It takes on the nature of an unwillingness
to really cooperate with us in having a reasonable and timely resolu-
tion of matters pending. This is being considered as a possible addi-
tion to this list of criteria.
Mr. Doyle. Does it involve his constitutional rights to plead the
Mr. Skallerup. Pardon, sir?
Mr. Doyle. Does it involve the area of his constitutional rights to
plead his constitutional privilege and refuse to answer?
Mr. Skallerup. Well, this constitutional privilege would exist with
respect to any one of the statements appearing in the Statement of
Mr. Doyle. Well, my question was directed to whether or not, by
experience, you found you had left out something that you wished you
had put in. That was the purport of my question. If so. what is it?
Mr. Skallerup. My answer was tliat what we are considering put-
ting in would be another criterion, which would state that the willful
refusal to answer questions set forth would be considered, along with
aW the other relevant factors in the case, in determining access.
Mr. JoirANSE>r. Mr. Chairman, in that connection, under Item 21
of the criteria : "Refusal by the individual, without satisfactory sub-
sequent explanation, to answer questions before a congressional or
legislative committee," and so on— now, does the phrase "without
satisfactory subsequent explanation" intend to convey that the ex-
planation that I invoke the fifth amendment in my refusal to answer
questions before this or any other member of the Congress — would
that be regarded as a satisfactory subsequent explanation?
Mr. Skallerup. Would refusal on grounds of the fifth amendment
be considered a satisfactory explanation for not replying?
Mr. JopiANSEX. That is right. In other words, would the invoca-
tion of the fifth amendment in response to a question as to wliether the
person had been or was a member of the Communist Party — would
the invocation of the fifth amendment get him off the hook, so far as
this 21st item is concerned ?
Mr. Skallerup. No. the intention is quite the reverse. This would
be considered as grounds upon which to deny access.
Mr. JoHANSEN. I am happy to hear that.
Mr. NiTTLE. You will note that H.R. 10175, as well as your draft
bill, adopts the procedure of authorizing reimbursement for loss of
earnings to aggrieved applicants under certain equitable circumstances.
Would such appropriation or application of funds toward reimburse-
ment require congressional sanction ?
Mr. Skallerup. We believe it does. The committee may be inter-
ested in some information with respect to the number of claims and
HEARINGS RELATING TO H.R. 10175 499
the size of claims, so that you have an idea of the size of the problem,
■sve are grapj^liiig witli.
During the period since 1955, there have been on the average
about 25 claims paid a year, and the average claim which has been
paid runs just a little over $2,500.
Mr. JoHANSEN. These are claims based on what grounds?
Mr. Skallerup. These are claims which are based on grounds that
the Government acted improperly in denying access or suspending
an access authorization.
Mr. JoiiANSEN. And he has lost pay as a consequence ?
Mr. Skallerup. And he has lost pay as a consequence, and at the
end of the line he was ultimately cleared.
And in the light of the whole record, is it not fair for the Govern-
ment to reimburse him something for that loss of wages? It is that
set of circumstances. But I would like to draw again the emphasis
we place on the fact that before we will entertain a claim, the man
must be cleared at the end of the line, must be granted access.
Mr. Tavenner. Mr. Chairman, may I go back to an earlier question ?
Mr. Doyle. Go ahead.
Mr. Tavenner. Reference was made to the use of the fifth amend-
ment in refusing to answer a question. Is it not a fact that under the
draft bill, in section 302, it is only in those cases in which the appli-
cant controverts a matter contained in the reasons submitted, that the
opportunity for examination and cross-examination and confrontation
is applicable ?
Mr. Skallerup. That is correct, Mr. Tavenner.
Mr. Ta\tenner. I would think that that should clarify the question
of the use of the fifth amendment.
Mr. Skallerup. A good point.
Mr. Nittle. I call your attention to section 302 of your draft bill,
particularly the opening clause, which establishes the power of the
Secretary to except certain cases from the operation of the personal
Is this power, which is vested in the Secretary to make exceptions
to an appearance procedure, conclusive and final ?
Mr. Skallerup. Are you speaking, sir, of the power which would be
granted should this be enacted? Or are you speaking of powers of
the Secretary as they are today ?
Mr. NrrTLE. As they are incorporated in the draft bill. I will read
that opening clause.
Section 302 begins this way : "Except in cases where the Secretaiy
personally determines that such procedures cannot be employed con-
sistently with the national security * * *."
Then, with that exception, you establish the personal appearance
proceeding to which an applicant will be entitled, with limited rights
of confrontation and cross-examination.
In the draft bill you give the Secretary the power to make excep-
tions to that procedure when he personally determines that such pro-
cedures cannot be employed consistently with the national security.
Now, is that determination of the Secretary reviewable in any way?
Mr. Skallerup. It is not reviewable in any way under our indus-
trial security review progranu Whether such action of the Secretaiy
might be reviewable in court is a matter that remains to be seen.
500 HEARINGS RELATING TO H.R. 10175
Mr. NiTTLE. Do you envisage any requirement, to be implied or in-
ferred in that language, that the Secretary, in making the determina-
tion of exception, shall give any Statement of Reasons underlying his
determination that the appearance procedures cannot be employed
consistently with the national security in a particular case?
Mr. Skai.lerup. No such requirements are intended.
Mr. NiTTLE. Would you care to exemplify the type of cases where
it is likely the Secretary may make such a determination ?
Mr. MacClain. I would like to give you a hypothetical situation
which would illustrate that problem, sir. Please bear in mind this is
Let us suppose that back in 1950 to 1954, the applicant engaged in
Communist Party activity. Available information shows that he was
a member, that he was active, that he was a party man.
Then let ns suppose that there is a period of time elapsing from 1954
until 1960, during which he is for all we know completely divorced
from any party activity of any kind.
Let us suppose that back in 1950 to 1954, the applicant engaged in
party activity, in and subsequent to 1960.
But let us suppose further that it is most important that he not know
that this activity of his is known.
Now, in a situation of that kind, you could not possibly resolve the
case by simply explaining the fact that back some years ago he was a
member of the party. He would say, "Yes, of course, I was," perhaps.
But in the Statement of Reasons that we would want to give him, we
could not, consistently with national security, tell him that this recent
activity is now also in the picture. And since we could not tell him
that, we could not really give him a Statement of Reasons which would
really tell him what the case was about.
If this is a sensitive situation, iuA^olving classified information, we
liave only one way to go, and that is to the Secretary, to make an
exception on these procedures.
Mr. NiTTLE. Mr. Chairman, the staff has no further questions of
the Department of Defense.
Mr. DoYLE. Are there any further questions?
The committee has no further questions.
I thank you, Mr. Skallerup, and your associates.
Mr. Skallerltp. Thank you, sir.
Mr. NiTTLE. Mr. Chairman, the committee invited the Department
of Labor to submit its views upon H.R. 10175. They have not sent
a personal representative here today, but have submitted a letter to
the committee, dated March 12, 1962. under tlie hand of the Honorable
Arthur J. Goldberg, Secretaiy of Labor, in which he supplies the
views of the Department of Labor on H.R. 10175.
I ask that this be made a part of the record at this point.
Mr. Doyle. Without objection, it will be so ordered.
(The letter follows:)
HEARINGS RELATING TO H.R. 10175 501
U. S.'DEP/>fRTMENT OF LABOR
OFFICE OF THE SECRETARY , jX (^ )
MAR ^ 2 ^gg2
The Honorable Francis E. Walter
Chairman, (^ramittee on Un-American
House of Representatives
Washington 25, D. C.
Dear Congressman Walter:
This is in further response to your request for
a report on H.R, 10175, a bill "To amend the Subversive
Activities Control Act of 1950 to provide for a security
program with respect to defense contractors and their em-
Although the Department of Labor does not ad-
minister any industrial security program, we of course
have a great concern in this area under the Department's
statutory responsibility with respect to the welfare of
Americsm wage earners. It is of the utmost importance
that any industrial security program effectively protect
the rights and interests of workers as well as of the
Government, and it is clear that one of the most basic
and important rights of an individual is that of being
allowed to earn his livelihood.
As you know, the general area of H.R. 10175 is
presently covered by Executive Order 10865, "Safeguarding
Classified Information within Industry*', issued February 20,
i960, and amended by Executive Order 10909 on January 17,
1961. This Executive Order was designed to counteract the
decision of the Supreme Court in Greene v. McElroy , 36O U.S.
U7U> that the Defense Department's former industrial secu-
rity program was authorized by neither statute nor Presi-
dential directive insofar as it provided for the denial or
revocation of security clearances of individuals in private
The Execvftive Order spells out the rights of
affected 'workers in substantial detail. It goes far to
protect the essential rights of these persons, including
their right to confront and cross-examine witnesses. In-
dividuals whose eligibility for access to classified in-
formation is questioned must be given a written statement^
502 HEARINGS RELATING TO H.R. 10175
The Honorable Francis E. Walter Page 2
as con^srehensive and detailed as national secixrity permits,
why their eligibility may be denied or revoked. They must
be afforded an opportunity to reply in writing, to appear
personally before the agency head, to prepare for that ap-
pearance, and to be represented by counsel. They are spe-
cifically given the right to cross-examine persons who have
made statements respecting a controverted issue, subject to
certain spelled-out limitations necessary to protect the
national interest and the identity of bona fide confidential
infcjrraants. When such a person may properly be denied the
right to confront and cross-examiiae a particular witness
under one of these limitations, he must be given a summary
of the information which shall be as comprehensive and de-
tailed as the national security permits. Comparable pro-
visions apply to documentary material which cannot be in-
spected by the individual because it is classified.
In passing upon an applicant's request for access
to classified information, the fact that he did not have an
opportunity to cross-examine a particular witness must be
taken into consideration and a final adverse determination
may be made only by the agency head based on his personal
review of the case. In addition, as much provision as pos-
sible, in the absence of the subpena power, is made to secure
the appearance of witnesses at the proceeding and to make
persons who have made adverse statements available for cross-
examination by the applicant. Moreover, the Order specifically
states that any adverse decision shall be a determination in
terras of the national interest and shall in no sense be a de-
termination as to the loyalty of the applicant,
H,R, 10175 provides for a personal appearance pro-
ceeding at which the person aggrieved shall be permitted to
present evidence in his behalf, and at which the United States
shall produce those persons who furnished adverse information
to the extent that the Secretary of Defense and the head of
the investigative agency that supplied the information shall
determine to be permissible in the interest of national se-
curity. The subpena power would also be conferred upon the
Secretary, These provisions, of course, recognize the exist-
ence of the rights of cross-examination and confrontation of
witnesses. However, they leave entirely to the Secretary's
discretion the determination of whether the national secxirity
HEARINGS RELATING TO H.R. 10175 503
The HonoraSle Francis E. Walter Page 3
permits the production of witnesses, with no limitations
along the lines of the Executive Order. In addition, the
other rights conferred by the Executive Order (although
they are doubtless conteii^>lated) would have to be Inferred
because they are not mentioned In the measure.
It would appear preferable for Industrial security
programs to remain subject to Executive Order rather than
statute, in order to retain flexibility to meet changing
situations. If It should be determined that the national
Interest would best be served by providing a legislative
foundation for such a program, we believe that the rights
of workers subject thereto should be protected to the extent
now provided by E. 0. 10865. We think It vital that exist-
ing protections be maintained In full and not reduced or
weakened In any fashion, particularly since the existing
program appears to have operated successfully. Denial of
security clearance may cost a worker his ability to support
himself and his dependents, a consequence so fraught with
Irreparable harm that It should be permitted only under the
The Bureau of the Budget advises that there is no
objection to the presentation of this report from the stand-
point of the Administration's program.
Secretary Off Labor
504 HEARINGS RELATING TO H.R. 10175
STATEMENT OF J. WALTER YEAGLEY, ASSISTANT ATTORNEY
GENERAL, IN CHARGE OF THE INTERNAL SECURITY DIVISION;
ACCOMPANIED BY JOHN F. DOHERTY, FIRST ASSISTANT, AND
KEVIN T. MARONEY, CHIEF, APPELLATE SECTION, DEPARTMENT
Mr. NiTTLE. Mr. Yeagley, will you and. your associates please come
Mr. Doyle. You are always welcome before the committee, gentle-
men. We appreciate your coming.
Mr. NiTTLE. Mr. Yeagley, would you kindly state your full name
for the record, your official capacity, and the agency whose views you
are authorized to present, together with the identification of your
associates, and their official capacity ?
Mr. Yeagley. Yes, sir. My name is J. Walter Yeagley, Y-e-a-g-1-e-y.
I am Assistant Attorney General of the Department of Justice, in
charge of the Internal Security Division, and my associates are ^Nlr.
John F. Doherty, my First Assistant, and Mr. Kevin Maroney, who
is the Chief of the Appellate Section.
Mr. Nittle. Do you have a statement for the committee in response
to its request for the views of the Department of Justice?
Mr. Yeagley. Yes, I do have a statement.
(Mr. Yeagley reading:)
Mr. Chairman and members of the committee. I am pleased to ap-
pear at this hearing on behalf of the Department of Justice in response
to your request for our views on H.R. 10175.
A sound industrial security program directed at the safeguarding
of classified defense information in the hands of industry is a subject
worthy of congressional interest and action.
It is, of course, necessary for the Government to entrust vital defense
secrets to industry if we are to build and maintain a suitable defense
In view of the constant effort of representatives of the Soviet bloc
to ferret out such information, it is important that adequate provision
be made for the protection of this data. An important part of this
protective effort is to know the background of the people who are to
have access to the information and to provide appropriate procedures
for processing cases concerning the few who may be untrustworthy.
As you know, the Supreme Court, in the case of Greene v. McElroy,
which has been discussed here today, and which came down on June
29, 1959, decided that the Department of Defense was not empowered
to deprive Greene of his job in a proceeding in which he was not af-
forded the opportunity of confrontation and cross-examination in the
absence of explicit authorization for such a hearing from either the
President or Congress.
As a result of the Greene decision, Executive Order 10865, entitled
"Safeguarding Classified Information Within Industry," was issued
on February 20, 1960. Pursuant to this Executive Order, the De-
])artment of Defense on July 28, 1960, issued "Industrial Personnel
Access Authorization Review Regulation," 25 Federal Register 7523
HEARINGS RELATING TO H.R. 10175 505
(1960), which sets forth procedures for implementing the industrial
The principal problems arising from screening procedures that are
directed at denying one access to classified information essential to his
job are posed by the fifth and sixth amendments to the Constitution,
particularly where the person is denied the right to cross-examine
witnesses supplying the information against him.
In recent 3^ears, the courts have given considerable attention to the
nature of the hearing and the right of cross-examination in govern-
mental administrative actions that may stigmatize persons or deprive
them of certain rights. If adverse information is to be considered
without advising the applicant of its source or of its precise nature,
while depriving him of the right to cross-examine the witness regard-
ing its accuracy and his motivation, it becomes apparent that any
safeguards in lieu of cross-examination that can be prescribed by the
Government regarding the nature and reliability of the source and
the probable accuracy of the information, w^ould be most helpful in
any litigation involving the constitutionality of the program.
^Ye think that the procedures established by E. O. 10865 adequately
protect the national security and at the same time in cases W'here cross-
examination of a witness is not possible provide the maximum safe-
guards possible toward assuring the reliability of the source and the
accuracy of the information.
Executive Order 10865 provides that an applicant shall have the
opportmiity to cross-examine persons who have furnished adverse in-
formation concerning him, except :
(1) Where the head of the department supplying the statement
certifies that the person who furnished the information is a confidential
infonnant who has been engaged in obtaining intelligence information
for the Government and that disclosure of his identity would be sub-
stantially harmful to the national interest; in the case where an FBI
informant is involved, this means a certificate signed personally by
the Attorney General ; or
(2) The head of the department concerned or his special designee
for that particular purpose has preliminarily determined, after con-
sidering information furnished by the investigative agency involved
as to the reliability of the person and the accuracy of the statement
concerned, that the statement concerned appears to be reliable and
material, and the head of the department or such special designee has
determined that failure to receive and consider such statement would,
in view of the level of access sought, be substantially harmful to the
national security and that the person who furnished the information
cannot appear to testify (A) due to death, severe illness, or similar
cause, in which case the identity of the person and the information to
be considered shall be made available to the applicant, or (B) due to
some other cause determined by the head of the department to be
good and sufficient.
If I may note here, No. 1 relates to information from informants,
confidential informants, and No. 2 relates to information from other
Mr. JoHANSEN. May I interrupt at that point ?
Mr. Yeaglet. Yes, sir.
506 HEARINGS RELATING TO H.R. 10175
Mr. JoiiAXSEx. I think this was discussed with the previous wit-
nesses, but could you give us your understandino: of tlie meaning of
2(B) "Due to some other cause determined by the head of the de-
partment to be good and sufficient"? How broad and inchisive and
sweeping is that ?
Mr. Yeagley. First of all, I do not believe that it was intended to
be broad and sweeping, for the reason that the authority is placed at
the level of the head of the department. He is a busy man, and they
are not going to be able to take many matters of this kind up with
him. It would therefore have to be in the exceptional and rare case.
It was a sort of exception, I believe, that was placed in this Order
for a very rare and unusual situation that the Secretary might feel
warranted no other action but this one particular exception.
And I cannot oft'-hand give you an example — I believe we could at
a later time — of the type of a rare case that might fall properly into
such a classification.
When the Government is compelled to rely on one of these excep-
tions, the applicant should be given a summary of the Statement of
Reasons which must be as comprehensive and detailed as the national
security pennits. Appropriate consideration shall be accorded to the
fact that the applicant did not have an opportunity to cross-examine
such a person or persons, and a final determination adverse to the
applicant shall be made only by the head of the department, based
upon his personal review of the case.
The Executive Order also contains provisions for the reception in
evidence and consideration, subject to rebuttal, of physical evidence —
other than investigative reports, both classified and unclassified — with-
•out authenticating witnesses.
We think this Executive Order provides a sound and workable pro-
gram, and that it should be given a chance to perfonn the function
for which it was intended.
I understand that a rather sizable number of personal appearance
proceedings, with full opportunity of cross-examination, have been
In any legal test regarding the nature of the hearing, it would, of
course, be desirable for the program to be supported by both Execu-
tive Order and congressional authorization in view of the language
in the Greene decision. However, we doubt the advisability of mak-
ing changes of substance or procedure at this time.
H.R. 10175 does not mention E.O. 10865. That bill would provide
legislative authority for the Secretary of Defense to prescribe security
safeguards for the protection of classified information in connection
with tlie performance of contracts of the United States which involve
classified information, without full cross-examination. It aifords the
right of cross-examination in access hearings "to the extent that the
Secretary, and the head of the investigative agency, if any, which
supplied the information, shall determine to be permissible in the
interest of national security."
Upon closer examination from the standpoint of a possible test in
court, we note that the bill does not require that the applicant be in-
formed prior to the hearing of the nature of the information he is
expected to refute. It seems to permit the Government to take into
consideration the entire investigative file, which might include infor-
HEARINGS RELATING TO H.R. 10175 507
mation from sources of unknown reliability, anonymous letters and
opinions of otliei-s, with no re(iuirement that the applicant be advised
of tlie nature of the information that may form the basis for an adverse
For the foregoing reasons, the Department of Justice does not en-
dorse H.R. 10175. It does support the view that it would be desirable
to have congressional autliorization for the present program under
E.0. 10865 and provisions relating to the payment of witnesses similar
to Section 5A(d) of H.R. 10175.
That concludes my statement.
Mv. Doyle. Thank you, Mr. Yeagley.
Any questions, counsel ?
Mr. NiTTLE. Mr. Yeagley, I presume you have examined the draft
bill of the Defense Department which was presented here this
Mr. Yeagley. Yes, I have. It has not been processed elsewhere in
our Department, nor have we commented to the Bureau of the Budget.
Mr. NiTTLE. Does the draft bill in your opinion meet the require-
ments you have pointed out in your statement, and does it provide a
sound basis for legislation ?
Mr. Yeagley. We think that it is a good bill, well drafted. It
covers practically all of them. But there are a few points, I think,
that should be noted, that is, points of difference, that to my mind,
raise a question as to the standing of Executive Order 10865, in the
event such a bill is passed without reference to the Executive Order.
I am not prepared to say now that it would revoke the Executive
Order, but it is different in some respects, and it does not endorse or
ratify or affirm the Executive Order, and that would raise a question,
Fii-st of all, I don't find in the bill a criterion to be used by the
Secretary in denying access. In other words, it is not clear whether
it is in the national interest, which is in the case of the Executive
Order, or if it is a security standard such as in the interest of national
I do not think there is a criterion in the bill to form the basis for a
decision, although I imderstand from the people in the Department
of Defense that they would under this bill reissue their present
Mr. JoHANSEN. Now, so the record will be completely clear, at this
juncture, and speaking of this bill, you are speaking of the revised
draft bill proposed by the Defense Department ?
Mr. Yeagley. That is correct.
The standard in Executive Order 10865, if I recall, was a standard
general in nature, but nonetheless a standard in the national interest, I
believe, or in the interest of the United States, without the word "se-
curity"' being involved.
It is a broad standard, and it was purposely drawn that way,
partly because of the desire to avoid stigmatizing the person who is
denied access, that the Defense Department people mentioned earlier.
If a man is denied access because he is not a good security risk, this
could be considered perhaps stigma, in the language of the Court in
some of its cases. The standard in the Executive Order now is clearly
consistent with the national interest.
508 HEARINGS RELATING TO H.R. 10175
I think the only other point I should note is that the Order pro-
A'ides for the head of the investigative agency to issue the certifica-
tion regarding an informant who is not available to testify'.
We have not talked with the FBI about this recently. They were
present at discussions, of course, involving a draft of the Executive
Order; and at that time it was their definite feeling that they did not
want to be in a position of furnishing the information and then also
making the determination as to whether or not they would permit
cross-examination of the informant, or whether they would withhold
it as secret information. They felt that the head of the Department
should make this determination, and not the agency that gathers the
information. Consequently, under the Executive Order, the head of
the Department supplying the information makes that determination
now, and I believe that the FBI would probably favor the same po-
sition today, although we have not talked to them about this draft of
the proposed bill.
Now, this has been prepared within the last few days, and we have
had revised copies as they w^ere changed. For this reason, it has not
been processed elsewhere in the Department, not even in my own
office. I have read it. I have made those few observations. We would
want, if it is introduced, to have the usual opportunity for depart-
mental comments on the bill.
Mr. NiTTLE. Would you comment briefly on what may be your views
as to the necessity of maintaining a security program, of the type
set up in the Executive Orders and the regulations of the Defense
Mr. Yeagley. Well, there is no doubt in my mind that there nuist
be adequate procedures and regulations with the proper authority be-
hind them, set up to protect these secrets that must be passed out to
industry if industry is to manufacture weapons or missiles or space
craft or other items relating to our national defense. Some of them
involve developments of the greatest secrecy; yet they must become
the knowledge of from hundreds to thousands of Americans who are
employees in defense industry.
We know, from the material we get, largely from the FBI, of course,
of tile constant activity aimed at obtaining American secrets, par-
ticularly of a technical nature, of industrial know-how, new inventions,
new processes in defense weapons. These efforts come from many
quarters. And we cannot assume that the millions of Americans in-
volved are all adequately prepared and capable of protecting the in-
formation that may come to them, so some check must be made.
I do not faiow that any serious question can be raised of the need to
have some protection for this information that goes out in great vol-
ume to a feW' million people.
^[r. Xtttle. The bill luider consideration nnd the draft bill of the
Defense Department are, of course, not confined solely to subversive
activities. However, based upon your experience and your present
office, Avould you agree with the statement the chainnan made this
morning: "It may be taken as factual that the Communists have suc-
ceeded in serious degree in accomplishing their planned infiltration
of basic iridustry" ?
Mr. Yeagley. If that implies that they have succeeded in doing
what they wanted to do, I would have to take some exception to that,
HEARINGS RELATING TO H.R. 10175 509
because their goals are considerably higher than what they have
I certainly agree with the point that the chainnan makes, that one
of the major points of infiltration by the Communist Party in this
country since its origin over 40 yeai*s ago has been basic industry,
and they have constantly made that one of tlieir important targets.
The only small exception I take is that I believe their goals are con-
siderably higher than their attainment.
Mr. NiTTLE. That may well be. But there is no question in your
muid, based upon your experience and your sources of information,
that the Communists have infiltrated basic industry ?
Mr. Yeaglet. Yes.
Mr. JoHANSEN. May I interject at that point?
And is there any question in your mind as to the persistent deter-
mination and desire to accomplish that result?
Mr. Yeagley. No, I have no question as to that.
Mr. JoHANSEN". Constituting an always present and serious actual
and/or potential internal danger to the United States ?
Mr. Yeagley. Absolutely. They had that as a goal before they
developed such a concern about acquiring technical secrets. That
goal was a part of the class struggle, infiltration of industry.
Mr. JoHANSEN. And therefore that is part of a domestic threat, as
opposed to an external threat ?
Mr. Yeagley. Not if I understand you. The threat comes from the
fact that the information wall end up in an external
Mr. JoHANSEN. I recognize that the destination is external ; but the
existing threat in this area is an internal threat within the United
Mr. Yeagley. Yes, espionage and matters related to that have been
one of the most important security problems that the Government has
faced over recent years in relation to the Soviet bloc.
Mr. NiTTLE. Based upon your knowledge and experience, do you
find that members of the Communist Party of the United States are
disposed, and indeed required by the principles of their association,
to commit sabotage and espionage under appropriate circumstances?
Mr. Yeagley. Yes, sir.
Mr. NiTTLE. The chairman quoted from the testunony of Mr, John
Lautner, who indicated that a high Communist Party official rendered
a secret report to the party when Lautner was likewise a high official
in the party, and boasted that by 1948, over 3,000 Communist Party
branches throughout the country, and between 400 and 500 industrial
branches, had been established.
Would you care to comment upon that testimony of Mr. Lautner ?
Mr. Yeagley. No. I do not think that I could add much to that.
I know John Lautner, of course. He has been a witness who has been
used by our lawyers in some of our cases. If he testified to that as of
1948, I would assume that he had reasonably accurate figures upon
which to base his statement. I do not know of anything to contra-
dict it, as of that date.
Mr. NiTTLE. As of that period.
Now, as of the present time, without asking you to disclose any mat-
ters of confidence, would you be able to say that in general thei'e are
at least a few hundred industrial branches of the Communist Party
established in American industry ?
510 HEARINGS RELATING TO H.R. 10175
Mr. Yeagley. This, of coui-se, is an invest ijrfitive problem. We do
not have investigators of our own. We get our information from the
FBI. I would not want my answer to be taken necessarily as factual.
It would have to be my opinion for what it is worth.
And I would concur in your statement, from the best judgment I
Mr. NiTTLE. Would you care to express your views as to the consti-
tutionality of the personal appearance proceedings set up in the De-
fense Department draft bill, which provide for a limited confronta-
tion and cross-examination proceeding?
Mr. Yeagley. If I may do that by basing my comment on the Ex-
ecutive Order, which I have had a great deal more to do with, ha^dng
previously noted the few differences between the bill you speak of, the
draft bill, and the Executive Order, I would rather do it from that
basis, because I feel like I have a better familiarity with the Executive
Mr. NiTTLE. Yes.
Mr. Yeagley. I believe, and we believe, that in an appropriate test
case in the Federal courts, the constitutionality of such a proceeding
could be sustained in the Supreme Court.
This is a guess. I hope it is an educated guess.
We participated with Defense and the Wliite House in preparing
the Executive Order, and tremendous man-hours of study and research
went into this, to determine what was required legally, constitution-
ally, and what was required from the standpoint of the interests of
national security, and a great number of men, lawyers, investi-
gators, and administrators, did their best to prepare a workable and
fair order. After hearing the testimony of the people from the De-
fense Department today on the success they have had under the Order,
I believe we could sustain it, although it would not be without some
Mr. NiTTLE. We would also like your opinion as to the necessity
for a limited type of proceeding, such as is established in that Execu-
Would it be inconsistent with the interests of national security to
require a full hearing in all security cases, with absolute rights guar-
anteed to confrontation and cross-examination — in all cases?
Mr. Yeagley. I did not get the first part of the question, sir. Would
it be required ? Would it be inconsistent ?
Mr. NiTFLE. Would it be inconsistent with the interests of national
security to require a full hearing, with full confrontation and cross-
Mr. Yeagley. Yes, I believe it would be inconsistent with the best
interests of security particularly if it required the production or un-
covering of informants regardless of their potential. There is lan-
guage in court opinions, in recent years, that the employee may suffer
some detriment from an adverse determination, or perhaps some
stigma or loss of job, in which case he could have a right to have
some opportunity to find out if there is error in the charges or in the
allegations against him, or find out if the source is one that holds
malice toward him. He may have a right under our constitutional
system to some fair proceeding in order to protect himself. And this
would have to, of course, be weighed in the light of what was the
Government's objective or the Government's needs. If the Govern-
HEARINGS RELATING TO H.R. 10175 511
ment has a vital area that it has to protect, and if there is a threat to
our Government, as there is today, then the Government also has an
The court does what is called a balancino; of the interests. If there
is a constitutional right, or some sort of a right of the individual
employee that may be infringed, the question then might be whether
the interest of the Government is an overriding interest, and was
maximum protection afforded to the employee under the circum-
If he is deemed to be entitled to a regular, full hearing with com-
plete right to confrontation and cross-examination, this would mean
that the Government would have a choice, one of two choices, to make,
in such a case.
It would have the choice of letting a potential agent retain his job
if the Government chooses to withhold a confidential informant that
it cannot reveal or uncover on the witness stand. The Government
may not be able to afford to release an informant in every instance.
He may be a vital part of Government coverage in a certain area.
The choice would be to micover the informant and lose the cov-
erage in future months or years in that area in order to produce him
as a witness to be cross-examined, or to keep quiet about the informant
and about the information it has on Mr. X, and let Mr, X proceed
in his employ.
Therefore I should add, I suppose, that if it is a full confrontation
hearing, the country's best security interests cannot be provided for.
I would like to observe, however, that I was greatly impressed, as
I imagine many of you were, with the statistics that the Defense De-
partment people have presented today, to show the large number of
cases in which full confrontation was possible and was provided ; and
that only in a very, very few cases, an extremely small percentage, a
fraction of a percentage, has it been necessary to consider the use of
an Attorney General's certificate in lieu of a live witness.
Mr. DoTLE. Is there any question from the committee members ?
Mr. Bruce. I have none.
Mr. Doyle. Mr. Johansen, do you have a question for our distin-
guished witness ?
Mr. Johansen. Mr. Attorney General, I was particularly interested
in and impressed by your comments indicating that you do regard this
situation as a present and continuing potential source of danger. I
would just like to make a comment, and then, if you care to, you can
comment on it.
There was published in the NeiD York Times on February 22nd of
this year one of the periodic paid ads urging that the Congress abolish
this committee. That is only incidental to the point I want to make
and the comment I want to make.
And one of the reasons alleged in this ad was that it caused us
to neglect settlement of problems in our foreign relations field — that
was the implication — or abroad, and attempted to concentrate at-
tention on the minuscule Communist movement in this country.
It is very interesting to note that one of the signers of this ad was
Mr. Russell Nixon, who has been in previous hearings identified before
this committee under oath as a Communist, and a man who I under-
stand until recently was with a union that was referred to in the hear-
512 HEARINGS RELATING TO H.R. 10175
ings this morning, and was the subject of hearings in the Pittsburgh
area several years ago.
It seems to me not irrelevant that in view of the concern that you
have expressed in this area of national security, and in view of your
vei-y clear testimony with respect to the existing and always potential
internal danger that we are addressing ourselves to, it is sufficient
just to call attention to this calculated and deliberate effort, the effort
to abolish the committee, for my purposes, being incidental, but this
deliberate and calculated effort, subscribed to by one man, who is
obviously a party in interest, to totally minimize any threat on the part
of the Communist Party in the United States.
I just wondered if you would like to comment on that.
Mr. Yeaglet. I did not see the advertisement you speak of. I do not
recall it now. I imagine that you gentlemen here have more detailed
knowledge than I do of your critics. Particularly if you are doing
something, you have critics.
I am not sure that I get the exact point of your question.
I woidd like to observe, however, that the lawyers in my office are
the lawyers that represent the House Committee on Un-American
Activities and the Senate Internal Security Subcommittee in the
courts when you desire to pursue contempt of Congress charges against
witnesses, and I have had the job, and I must say the pleasure, to par-
ticipate in some of those cases myself.
So we have a great familiarity with the committee, what it does,
what it has done, how it works, and also to some extent with the crit-
ics. We have been meeting, I think, with increasing success, and I
hope it continues.
Mr. JoiiAxsEN. Well, my point goes not to criticism of the commit-
tee ; my point goes to the fact that here, as a part of this campaign, we
have the evidence of the continuing campaign to minimize the exis-
tence of any internal threat so far as the Communists are concerned,
and one of the advocates of that doctrine is a man who, on the basis of
sworn testimony before this committee, has a considerable and obvious
interest in minimizing it. That is the point I wanted to make.
Mr. Yeagley. As far as I know, all Communists would join with
him, if they had the courage and the opportunity, to criticize this com-
mittee, as well as the other one.
Mr. JoiiANSEN. That is all I have.
Mr. Doyle. Mr. Yeagley, I noticed you made a brief observation
in answer to Mr. Johansen's question as to the possible degree or
extent to which the Communist conspiracy or Communist Party
activities were internal, that is, within our own domestic confines. I
was interested particularly in your answer, wliich was very brief,
wherein you mentioned that the information went to external sources.
Could you elaborate on that some, please? Because I am aware of
frequent communications these days, from constituents and others,
whicli claim that our Government is not paying any attention, or
enough attention, to the Commmiist conspiracy within our own domes-
tic confines, and too much to it in other parts of the world.
Now, if you have any opinion on the extent to which the Com-
munist movement still operates within our domestic territory, as com-
pared with the outside, I would appreciate it.
Mr. Yeagley. I do not know if I can make clear my own feelings
on this, but it is an important area, I think. We, too, get a great deal
HEARINGS RELATING TO H.R. 10175 513
of correspondence from the public. I am not sure that we are able to
express ourselves or explain it adequately. And of course our position
may be wrong.
It seems to me, at least, that the great problem today, the great
danger, not only to us, to this countiy, but to hmnanity itself, comes
from this tremendous international Communist movement, as prin-
cipally represented by the Soviet bloc. That is to me the danger. It
could cause a tremendously destructive nuclear war that might wipe
out humanity, or most of it, certainly civilization as we know it today.
That threat is one that is almost beyond human comprehension. And
to me this is the real big danger, the real big problem. It is right
The Communist Party in this country, the same as the Communist
Party in any country, is not only an agent of that group, but is part
and parcel of the Soviet bloc and the international Communist move-
ment. They are all members of the same crowd, with the same
They may claim and be able to establish American citizenship, but
as far as I am concerned, for the most part that is a paper documenta-
tion, and what they have in their hearts and their minds is what
concerns us. I can only consider them to be as much a part of
this international threat as a member of the Communist Party in the
Soviet Union would be, and that if they had the opportunity here, they
would do as much for the Soviet movement.
After all, the members of the Communist Party are not newly be-
come Commmiists. Wliat we liave in this comitiy today are the hard-
core, old-time Communists that are left after the party has fallen in
membership by many, many thousands over the years, and those that
are left tx)day are really hard-core, devoted Soviet-bloc Communists,
international Communists, as I see it.
]Mr. Bruce. Mr. Chairman, may I interject there, and ask a question
on that ?
Is it not a tactic of an internal Communist Party to narrow down
and get rid of the soft flesh, as it were, at times of real crisis, so that
the numbers can be a misleading evaluation of the strength of the
Communist movement ? Would that be correct ?
Mr. Yeaglet. Yes, that could be correct. They as you know have
had their purges, and they have times when they have membership
drives, and other times when they do not.
The answer to your question is yes, sir. It could be correct.
Pardon me. I might add one point. It is a part of this same area.
I do not want to leave the impression that when one of us in the
Department may speak in terms of approximately how many Com-
munists there are in this country, that that means necessarily that we
are certain that those who left the party have left permanently. We
do know this : that many of them who have left are not talking about
it. They are not talking about what they used to do. They are not
cooperating with the Government. There may be others, so-called
bandwagon Communists, that might be glad to jump back on if condi-
tions become more appropriate for that.
So figures, as you say, are interesting and useful, but their signifi-
cance sometimes is a bit elusive.
Mr. Bruce. There is, as you know, a great deal of controversy, and
this is what we have been dealing with for the last few minutes, about
514 HEARINGS RELATING TO H.R. 10175
this diversionary aro^iiment, of whether the strength or the danger of
the Communist Party is internal or external. And if I am interpret-
inc; Avliat you have said correctly, you are sayinjj that it is one and the
same, that you cannot se])arate internal and external, that it is the
Communist worldwide conspiracy, which is a faith in a military oper-
ation and an economic operation, and that the Communist Party in
any g^ven country, tlie Ignited States, Mexico, or anywhere else, is a
danger in direct j^roportion to the world Communist movement, being
under the discipline thereof.
So actually it is a nice diversion for us to set ourselves one against
the other on whether the danger is internal or external. It is a total
danger that comprises both, because they are one and the same. The
danger is the world Communist movement. And their agent in any
given country is the Communist apparatus.
Is that correct ?
Mr. Yeagley. Yes. I would like to add that some who have com-
mented on this have perhaps a different idea in mind in discussing
that relationship, and being primarily interested in the political capa-
bility of the group in any given country.
Mr. Bruce. But it is true that they have built a good deal of their
military strength as a result of their disciplined apparatus within
the United States. They short-circuited their atomic research neces-
sities with their espionage system and many other advances, where
they could leapfrog over some of the painful experimentation as a
result of the success of their apparatus within our society.
That would be correct, would it not?
Mr. Yeagley. Oh, yes. They have made, I suppose, considerable
use out of their espionage network, as we know from the Klaus Fuchs
case and the Rosenberg case. There is no doubt about that.
Mr. Xittle. Mr. Chairman, may I ask the witness a few additional
Mr. Doyle. Yes, indeed.
Mr. NiTTLE. I believe the Attorney General was quoted in the news-
papers some weeks ago, Mr. Yeagley, as indicating that the Commu-
nist Party membership was now about 10,000.
Am I correct in that statement?
Mr. Yeagley. I did not see that. You could be correct. I did not
Mr. NiTTLE. Have you made any public pronouncements as to the
present membership of the Communist Party?
Mr. Yeagley. I have made some statement about my opinion as to
Mr. NiTFLE. Would you indicate that for the record, please?
Mr. Yeagley. I am not quite sure what I said, but I believe it was
Mr. NiTn.E. Now, when you give the figure of membership of 8,000,
are you referring simply to what might be called formal member-
ship? A moment ago you indicated that several thousand Commu-
nists have left the party; but there was some doubt as to whether
they were continuing their sympathetic association with it and fol-
lowing its line. Now, when you referred to a membership of 8,000,
are you referring to what might be called the formal membership?
HEARINGS RELATING TO H.R. 10175 515
Mr. Yeagley. Not quite. I do not believe the Comniunist Party
knows what its formal membership is. It is not that precise, 1 do
not believe. And so I am not claiming that my ligure has any par-
ticular accuracy, except that it is indeed the best judgment 1 can
make on the material I have seen currently, as compared to what I
used to see when I was in the FBI a good many years ago. And it is
frankly not based on formal membership, but on what I think is an
accurate figure of people who today would consider themselves to
Mr. Bruce. On that, sir, has not Mr. Hoover somewhat qualified the
use of a figure on this with the rest of a statement which so often is
forgotten, that for every one of these, there are ten others ready,
willing, and able to carry out the bidding of the Communist Party?
So according to his statement, you would almost have to multiply
the official figure that is given by ten ?
Mr. Yeagley. Yes, he has said that, I think, on more than one occa-
Mr. NiTTi.E. Communist Party publications have a circulation and
a paid circulation far in excess of the membership figure which you
have given ?
Mr. Yeagley. That is correct.
Mr. Nittle. It may be true that some of these Communist publica-
tions are circulated to certain Government agencies and other non-
Communists for intelligence or research purposes, but certainly not to
the extent of the several thousand indicated by the paid circulation of
these newspapers in excess of the membership figures you have given.
The Worker has a circulation, a paid circulation, I believe, of 15 or 20
thousand on the East Coast. The Peoph\s World has a circulation of
over 6,000 on the West Coast. There are other Communist publica-
tions circulated to the extent of several thousand more. There is an
indicated paid circulation of possibly 30,000 and more.
W\\o are these people that are reading these publications?
Are these people loyal Americans, or are they Communists in
sympathy with, and following the propaganda line of, the Communist
Party and its policies and therefore engaging in the sabotage of Amer-
ican policy in that way?
I mean to ask: Do we not minimize the extent of Communist action
in this country when we say the membership is just 8,000?
Mr. Yeagley. I think the figures you have given on subscriptions
may well be correct. I do not know. This is an area which we, as
law enforcement people, do not get into so much, because this is
obviously in the area of freedom of the press, and until recently, we
had no legitimate concern with the publications as violating any of
Mr. Nitt^le. There is a violation of the law if Communist publica-
tions are not labeled under the Internal Security xVct.
Mr. Yeagley, Since this order became final, of the Subversive Ac-
tivities Control Board, as a result of the Supreme Court action, we
do now have an interest in any publication that is disseminated by
the Communist Party, being appropriately labeled. They are not in
violation of law so long as they label it. That is all that is required.
They do not have to go out of business. But if they fail to label, and
if we can establish a case in court, then they would be subject to
516 HEARINGS RELATING TO H.R. 10175
You may have noted from the press recently that we have beo;un a
grand jury investigation here in the District of Cohimbia to deter-
mine whether The Worker, for example, should be labeled, and who
could be prosecuted for failure to label.
The contempt action this week against James E. Jackson, who is
the editor of The Worker, was not mereh' a case of some Government
lawyers snooping into the freedom of the press, at all. It was a case
of the law stating that a publication must be labeled, disseminated by
blank, a Communist organization, if in fact it is so disseminated. And
The Worker^ we believe, fell into that category, at least so as to require
a grand jury investigation. The Acting Attorney General authorized
a grand jury investigation into this area as a part of our responsibility
to enforce the law.
Mr. NiTTLE. Of course, I want to remain clear on the record that we
by no means suggest that freedom of the press should be interfered
with. My questions were not put to you with that thought in mind,
but I noted the circulation of Communist ]:)ublications as somewhat
of a gauge to determine the number of Communists within the country
who follow the party line, but who may not be formal members or
Now, certainly in the mid-1940's, I think Mr. Hoover announced
that there were in excess of 50,000 Communist Party members at that
time. Then followed, of course, a series of prosecutions under the
Smith Act by the Justice Department, and membership in the partv
Now, does one suppose that these people ceased being Communists,
or did they simply sever formal membership for the purpose of avoid-
ing prosecution ?
Mr. Yeagley. Yes, that was the point I was raising a bit earlier.
Mr. TA^T.NXER. Mr. Chairman, since the questioning has gotten into
this area, it might be pertinent to make this comment : That a seri-
ously considered estimation of the number of persons in the United
States today who have been members of the Communist Party reaches
the astounding figure of 700,000. No one knows how many of those
persons left the Communist Party through conscience or conviction.
and no one knows how many of that great number are out onlj^ organ-
Mr. SciTERKR. May I ask one question ?
Do you feel, Mr. Yeagley, that there is adequate legislation on the
books to enable the Government to deal effectively with potential
espionage agents or saboteurs in defense plants ?
Mr. Yeagley. Well, we are recommending today that legislation
supporting the present industrial security program would be useful.
If we had both an Executive Order and legislation, it would fortify
us in the courts.
Tlie question you raise also involves what I believe we used to call
the defense facilities protection bill. And I think this one you re-
ferred to today has been received in the Department of Justice, if I
am not mistaken, and T believe it is under consideration. I have not
seen the present draft. I know we have not commented on it.
There has been a little water over the dam, judicially speaking,
since the position we took 5 years ago. I regret that I do not know
our answer to your question as of this moment.
HEARINGS RELATING TO H.R. 10175 517
Mr. SciiERER. You are not able to say whether tlie Justice Depart-
ment feels the need of such legislation, as you did 4 or 5 years ago ?
Mr. Yeagley. There may be a need. I do not know, in view of the
legal problems involved, what our comments will be. I really have,
not read the bill, and I have not thought in terms of the rest of in-
dustry as compared with this particular area we are discussing today.
Mr. ScHERER. I was not thinking in reference to the specific terms
of a specific bill.
Mr. Yeagley. I can only put it this way : that we know that there
are a great many people here who are Communists. We know where
their loyalties are, and not only that, but their interests and their hopes
and their desires. If they are in an area that is sensitive, where they
have access to information, I would have to assume they are going to
pass it on.
Mr. Scherer. I was not exactly talking about information. I be-
lieve you were in the room this morning when I used the illustration
of a security risk or a potential saboteur working in a utility plant
which is in support of a defense plant. Do you have any legislation
to deal with this fellow ? Suppose you find out that he had actually
studied, taken courses in sabotage, and he is in a position to pull
a switch in a utility plant or power plant supplying electricity to one
of our defense plants. There is nothing you can do about it, is
Mr. Yeagley. This gets into an area, just off-hand, of what this
man may intend to do or possibly do in the future from the stand-
point of sabotage. Of course, there are many plants that have had
security surveys over the years, for the veiy purpose of protecting
their facilities : so that a very, very limited number of people can get
into the type of an area you are speaking about.
But I am sure this must not be the case in eveiy situation.
Mr. Scherer. You do not have any legislation whereby you could
remove such an individual from that sensitive position today, whether
he is in a support plant or whether he is actually in a defense plant?
And I am not talking about classified information. I am talking
about protection of, say, weapons, missiles.
Mr. Yeagley. I do not know that we have anything at all. Neither
do I know that this question has been posed to us as an actuality;
so that we have probably never studied this precise question. We
have had no cases of this kind.
Mr. Scherer. The Defense Department has testified on a number
of occasions since I have been a member of this committee, and con-
sistently since 1950 has asked for legislation to meet this particular
problem which I posed.
Mr. Yeagley. Yes, I believe the Department of Justice testified in
1957 on a bill of that type, or at least on a problem very closely related
Mr. Scherer. I think you approved a bill that was submitted to
the Defense Department, if my recollection is correct.
Mr. Yeagley. I believe we testified either for the objective of the
bill or for the bill itself. I am not quite clear on it, but we did testify
here at that time.
Mr. Scherer. I think such a bill is just as important as this legisla-
tion to protect classified information. As far as I have been, I have
518 HEARINGS RELATING TO H.R, 10175
not been able to find anything whereby we might deal effectively with
a situation such as that which I have outlined.
The Defense Department said they were going to give considera-
tion to it. I would certainly appreciate it if the Justice Department
would review its position on this.
Mr. Yeagley. Fine. Yes, we intend to.
Mr. Doyle. Any other questions, Counsel ?
Mr. NiTTLE. No, sir.
Mr. Doyle. Any other questions by members of the committee ?
We thank you, Mr. Yeagley, and your associates. We appreciate
your being in the hearing room all day with us.
Mr. Yeagley. Yes, Mr. Chairman. Thank you.
Mr. Doyle. We are sorry we had to make you wait so long.
Mr. Yeagley. That is all right.
Mr. Doyle. Is there any other matter to come before the committee ?
Mr. NiTTLE. There are no further witnesses to be presented on this
bill, Mr. Chairman.
Mr. DoYLE. Then the committee will stand adjourned on this par-
(Whereupon, at 4 :00 p.m., Thursday, March 15, 1962, the committee
adjourned subject to the call of the Chair.)
Exhibit No. 1
Executive Order 10865
safeguarding classified information within industry
T^^EREAS it is mandatory that the United States protect itself
against hostile or destructive activities by preventing unauthorized
disclosures of classified information relating to the national defense ;
WHEREAS it is a fundamental principle of our Government to
protect the interests of individuals against unreasonable or unwar-
ranted encroachment; and
WHEREAS I find that the provisions and procedures prescribed
by this order are necessary to assure the presentation of the integrity
of classified defense information and to protect the national interest ;
T^^^EREAS I find that those provisions and procedures recognize
the interest of individuals affected thereby and provide maximum
possible safeguards to protect such interests:
NOW, THEREFORE, under and by virtue of the authority vested
in me by the Constitution and statutes of the United States, and as
President of the United States and as Commander in Chief of the
armed forces of the United States, it is hereby ordered as follows:
Section 1. (a) The Secretary of State, the Secretary of Defense,
the Commissioners of the Atomic Energy Commission, the Adminis-
trator of the National Aeronautics and Space Administration, and
the Administrator of the Federal Aviation Agency, respectively, shall,
by regulation, prescribe such specific requirements, restrictions, and
other safeguards as they consider necessary to protect (1) releases
of classified information to or within United States industiy that
relate to bidding on, or the negotiation, award, performance, or termi-
nation of, contracts with their respective agencies, and (2) other
releases of classified information to or within industry that such
agencies have responsibility for safeguarding. So far as possible,
regulations prescribed by them under this order shall be uniform and
provide for full cooperation among the agencies concerned.
(b) Under agreement between the Department of Defense and any
other department or agency of the United States, including, but not
limited to, those referred to in subsection (c) of this section, regula-
tions prescribed by the Secretary of Defense under subsection (a) of
this section may be extended to apply to protect releases (1) of classi-
fied information to or within United States industry that relate to
bidding on, or the negotiation, award, performance, or termination of,
82627 0—^2 6
520 HEARINGS RELATING TO H.R. 10175
contracts with such other department or agency, and (2) other releases
of classified information to or within industry which such other de-
partment or agency has responsibility for safeguarding.
(c) When used in this order, the term "head of a department"
means the Secretary of State, the Secretary of Defense, the Commis-
sioners of the Atomic Energy Commission, the Administrator of the
National Aeronautics and Space Administration, the Administrator
of the Federal Aviation Agency, and, in sections 4 and 8, includes the
Attorney General. The term "department" means the Department
of State, the Department of Defense, and the Atomic Energy Com-
mission, the National Aeronautics and Space Administration, the Fed-
eral Aviation Agency, and, in sections 4 and 8, includes the Depart-
ment of Justice.
Sec. 2. An authorization for access to classified information may be
granted by the head of a department or his designee, including but
not limited to, those officials named in section 8 of this order, to an
individual, hereinafter termed an "applicant", for a specific classifica-
tion category only upon a finding that it is clearly consistent with the
national interest to do so.
Sec. 3. Except as provided in section 9 of this order, an authoriza-
tion for access to a specific classification category may not be finally
denied or revoked by the head of a department or his designeej includ-
ing, but not limited to, those officials named in section 8 of this order,
unless the applicant has been given the following :
(1) A written statement of the reasons why his access authoriza-
tion may be denied or revoked, which shall be as comprehensive and
detailed as the national security permits.
(2) A reasonable opportunity to reply in writing under oath or
affirmation to the statement of reasons.
(3) After he has filed under oath or affirmation a written reply to
the statement of reasons, the form and sufficiency of which may be
prescribed by regulations issued by the head of the department con-
cerned, an opportunity to appear pereonally before the head of the
department concerned or his designee, including, but not limited to,
those officials named in section 8 of this order, for the purpose of sup-
porting his eligibility for access authorization and to present evidence
on his behalf.
(4) A reasonable time to prepare for that appearance.
( 5 ) An opportunity to be represented by counsel.
(6) An opportunity to cross-examine persons either orally or
through written interrogatories in accordance with section 4 on
matters not relating to the characterization in the statement of reasons
of any organization or individual other tlian the applicant.
(7) A written notice of tlie final decision in his case which, if ad-
verse, shall specify whether the head of the department or his designee,
including, but not limited to, those officials named in section 8 of this
order, found for or against him with respect to each allegation in the
statement of reasons.
Sec. 4. (a) An applicant shall be afforded an opportunity to cross-
examine persons who liave made oral or written statements adverse to
the applicant relating to a controverted issue except that any such
statement may be i*eceived and considered witliout affording such
opportunity in the circumstances described in either of the following
HEARINGS RELATING TO H.R. 10175 521
(1) The head of tlie department supplying the statement certifies
that the person who furnished the information is a confidential in-
formant wlio has been engaged in obtaining intelligence information
for the Government and that disclosure of his identity would be sub-
stantially harmful to the national interest.
(2) The liead of the department concerned or his special designee
for that particular purpose has preliminarily determined, after con-
sidering information furnished by the investigative agency involved
as to the reliability of the person and the accuracy of the statement
concerned, that tlie statement concerned appears to be reliable and
material, and the head of the department or such special designee has
determined that failure to receive and consider such statement would,
in view of the level of access sought, be substantially harmful to the
national security and that the person who furnished the information
cannot appear to testify (A) due to death, severe illness, or similar
cause, in which case the identity of the person and the information to
be considered shall be made available to the applicant, or (B) due to
some other cause determined by the head of the department to be good
(b) "VAHienever procedures under paragraphs (1) or (2) of sub-
section (a) of this section are used (1) the applicant shall be given a
summary of the information which shall be as comprehensi-«"e and
detailed as the national security permits, (2) appropriate considera-
tion shall be accorded to the fact tliat the applicant did not have an
opportunity to cross-examine such person or persons, and (3) a final
determination adverse to the applicant shall be made only by the head
of the department based upon his personal review of the case.
Sec. 5. (a) Records compiled in the regular course of business, or
other physical evidence other than investigative reports, may be re-
ceived and considered subject to rebuttal without authenticating wit-
nesses, provided that such information has been furnished to the de-
partment concerned by an investigative agency pursuant to its respon-
sibilities in connection with assisting the head of the department
concerned to safeguard classified information within industry pursu-
ant to this order.
(b) Records compiled in the regular couree of business, or other
physical evidence other than investigative reports, relating to a con-
troverted issue which, because they are classified, may not be inspected
by the applicant, may be received and considered provided that: (1)
the head of the department concerned or his special designee for that
purpose has made a preliminary determination that such physical
evidence appears to be material, (2) the head of the department con-
cerned or such designee has made a determination that failure to re-
ceive and consider such physical evidence would, in view of the level
of access sought, be substantially harmful to the national security, and
(3) to the extent that the national security permits, a summary or
description of such physical evidence is made available to the appli-
cant. In every such case, information as to the authenticity and ac-
curacy of such physical evidence furnished by the investigative agency
involved shall be considered. In such instances a final determination
adverse to the applicant shall be made only by the head of the depart-
ment based upon his personal review of the case.
Sec. 6. Because existing law does not authorize the Department of
State, the Department of Defense, or the National Aeronautics and
522 HEARINGS RELATING TO H.R. 10175
Space Administration to siibpena witnesses, the Secretary of State,
the Secretary of Defense, or the Administrator of tlie National Aero-
nautics and Space Administration, or his representative, may issue, in
appropriate cases, invitations and requests to appear and testify in
order tliat the applicant may have the opportunity to cross-examine
as provided by this order. So far as the national security permits, the
head of the investigative agency involved shall cooperate with tlie Sec-
retary or the Administrator, as the case may be, in identifyintj pereons
who have made statements adverse to the applicant and in assisting
him in making them available for cross-examination. If a person so
invited is an officer or employee of the executive branch of the Govern-
ment or a member of the armed forces of the United States, the head
of the department or agency concerned shall cooperate in making that
person available for cross-examination.
Sec. 7. Any determination under this order adverse to nn applicant
shall be a determination in terms of the national inte;^"' and shall
in no sense be a determination as to the loyalty of tlie . n iicant con-
Sec. 8. Except as otherwise specified in the preceding provisions
of this order, any authority vested in the head of a department by this
order may be delegated to tlie
(1) Under Secretary of State or a Deputy Under Secretary of State,
in the case of authority vested in the Secretary of State;
(2) Deputy Secretary of Defense or an Assistant Secretary of De-
fense, in the case of authority vested in the Secretary of Defense ;
(3) General Manager of tlie Atomic Energy Commission, in the case
of authority vested in the Commissioners of the Atomic Energy Com-
(4) Deputy Administrator of the National Aeronautics and Space
Administration, in the case of authority vested in the Administrator
of the National Aeronautics and Space Administration ;
(5) Deputy Administrator of the Federal Aviation Agency, in the
case of authority vested in the Administrator of the Federal Aviation
(6) Deputy Attorney General or an Assistant Attorney General, in
the case of authority vested in the Attomey General.
Sec. 9. Nothing contained in this order shall be deemed to limit or
affect the i^sponsibility and ])owers of the head of a department to
deny or revoke access to a specific classification category if the security
of the nation so requires. Such authority may not be delegated and
may be exercised only when the head of a department determines
that the procedures prescribed in sections 3, 4, and 5 cannot be invoked
consistently with the national security and such determination shall
DwiOHT D. ElSENirOWER
The White House, Fehmary W^ 1960.
[F.R. Doc. 60-1735 ; Filed, Feb. 23, 1960; 11 :51 a.m.]
Exhibit No. 2
Executive Order 10909
amendment of executive order no. 108 6 5/ safeguarding classified
information within industry
Bv virtue of the authority vested in me by the Constitution and stat-
utes'of the United States, and as President of the United States, and
as Commander in Chief of the armed forces of the TTnited States,
Executive Order No. 10865 of Febniary 20, 1960 (25 F.E. 1583), is
hereby amended as follows :
Section 1. Section 1(c) is amended to read as follows :
" (c) When used in this order, the term 'head of a department' means
the Secretary of Stat^, the Secretary of Defense, the Commissioners
of the Atomic Energy Commission, the Administrator of the National
Aeronautics and Space Administration, the Administrator of the Fed-
eral Aviation Agency, the head of any other department or agency of
the United States with which the Department of Defense makes an
agreement under subsection (b) of this section, and, in sections 4 and
8, includes the Attorney General. The term 'department" means the
Department of State, the Department of Defense, the Atomic Energy
Commission, the National Aeronautics and Space Administration, the
Federal Aviation Agency, any other department or agency of the
United States Avith which tlie Department of Defense makes an agree-
ment under subsection (b) of this section, and, in sections 4 and 8,
includes the Department of Justice."
Sec. 2. Section 6 is amended to read as follows :
"Sec. 6. The Secretary of State, the Secretary of Defense, the Ad-
ministrator of the National Aeronautics and Space Administration,
the Administrator of the Federal Aviation Agency, or his representa-
tive, or the head of any other department or agency of the United
States with which the Department of Defense makes an agreement
under section 1(b), or his representative, may issue, in appropriate
cases, invitations and requests to appear and testify in order that the
applicant may have the opportunity to cross-examine as provided by
this order. AVhenever a witness is so invited or requested to appear
and testify at a proceeding and the witness is an officer or employee of
the executi\e branch of the Government or a member of the armed
forces of the United States, and the proceeding involves the activity
in connection with which the witness is employed, travel expenses and
per diem are authorized as provided by the Standardized Government
Travel Eegulations or the Joint Travel Regulations, as appropriate.
In all other cases (including non-Government employees as well as
officers or employees of the executive branch of the Government or
members of the armed forces of the United States not covered by the
1 25 F.R. 1583.
524 HEARINGS RELATING TO H.R. 10175
foregoing sentence), transportation in kind and reimbursement for
actual expenses are authorized in an amount not to exceed the amount
payable under Standardized Government Travel Regulations. An
officer or employee of the executive branch of the Government or a
member of the armed forces of the United States who is invited or
requested to appear pursuant to this paragraph shall be deemed to be
in the performance of his official duties. So far as the national security
permits, the head of the investigative agency involved shall cooperate
with the Secretary, the Administrator, or the head of the other depart-
ment or agency, as the case may be, in identifying persons who have
made statements adverse to the applicant and in assisting him in mak-
ing them available for cross-examination. If a person so invited is an
officer or employee of the executive branch of the Government or a
member of the armed forces of the United States, the head of the de-
partment or agency concerned shall cooperate in making that person
available for cross-examination."
Sec. 3. Section 8 is amended by striking out the word "or" at the end
of clause (5), by striking out the period at the end of clause (6) and
inserting "; or" in place thereof, and by adding the following new
clause at the end thereof:
" ( Y) the deputy of that department, or the principal assistant to the
head of that department, as the case may be, in the case of authority
vested in the head of a department or agency of the United States
with which the Department of Defense makes an agreement under
DwiGiiT D. EISE^^Ho^\^:R.
The White House, January 17, 1961.
[F.R. Doc. 61-567 ; Filed, Jan. 18, 1961 ; 2: 08 p.m.]
HEARINGS RELATING TO H.R. 10175 525
Exhibit No. 3
July 28, i960
NUMBER 5220. 6
Department of Defense Directive
SUBJECT Industrial Personnel Access Authorization Review Regulation
Reference: (a) DOD Directive 5220.6, entitled "Industrial Personnel
Security Review Regulation, " dated February 2, 1955,
as amended (cancelled)
This Regulation Is issued pursuant to the authority vested
by law, Including Executive Order IO865 (reproduced as
Appendix A), In the Secretary of Defense.
By an exchange of letters between the Secretary of Defense
and the Administrators of the Federal Aviation Agency and
the National Aeronautics and Space Administration, and as
provided for in Section 1 (b). Executive Order IO865, the
Deparijnent of Defense has been authorized to act for and
in behalf of the Federal Aviation Agency and the National
Aeronautics and Space Administration in the performance
of the administrative and personnel services set forth in
this Regulation. Reference (a) is hereby cancelled.
1. The Secretary of Defense and the Administrators of the
Federal Aviation Agency, and the National Aeronautics
and Spa^e Administration have prescribed specific
requirements, restrictions, and other safeguards which
they consider necessary to protiect (a) releases of
classified Infonnation to or within United States
Industry that relate to bids, negotiations, awards, or
the performance or termination of contracts with their
department or agency, and (b) other releases of classified
Information to or within industry which their department
or agency has responsibility for safeguarding. In this
connection, this Regulation prescribes uniform standards.
526 HEARINGS RELATING TO H.R. 10175
criteria, and procedures for processing to final determina-
tion all cases which ccane within the scope of the Industrial
Personnel Access Authorization Review Program.
2. Pursuant to the agreement made between the Department of
Defense, and thtf Federal Aviation Agency, and the National
Aeronautics and Space Administration, (provided for in
Section 1 (b). Executive Order IO865), this Regulation has
been extended to apply to protect the releases of classified
information specified in subparagraph 1., above. The Boards
eind instrumentalities provided for in this Regulation are
hereby authorized to assxame jurisdiction over, and as herein-
after provided, to process eind make determinations in cases
arising out of such releases of classified information.
3. This Regulation is Issued to conform the Industrial Personnel
Access Authorization Review Program to the requirements of
Executive Order IO865.
1. Whenever the words "Department of Defense", or "Department
of Defense agency or activity", or "military department"
are used herein, they shall be deemed to include where
applicable the Federal Aviation Agency, or the Nationeil
Aeronautics and Space Administration.
2. Access Authorization : An authorization to have access to
one or more categories of information classified in
accordance with Executive Order IO50I. (NOTE: Actual
access, when authorized, requires both an access authoriza-
tion and a "need to know".) In the case of a contractor,
an "access authorization" is an authorization for the
contractor involved to have access to specific categories
of classified information provided such access is (a) required
in connection with the bidding, negotiation, award, performance,
or termination of contracts with a Department of Defense agency
or activity or (b) required in connection with other releases
of classified information to or within industry. In the case
of a contractor employee, em "access authorization" is an
authorization for the employee to have access to specific
categories of classified information provided such access is
(1) required for the performance of his work with a particular
contractor on contracts with a Department of Defense agency
or activity or (2) required in connection with the release
of classified information to or within industry.
3. Administrator : The Administrator of the Federal Aviation
Agency, or the National Aeronstutics and Space Administration.
HEARINGS RELATING TO H.R. 10175 527
k. Agency case : A case arising out of the release of cleisslfled
information to or within industry directly by the FedereJ.
Aviation Agency or the National Aeronautics and Space
Administration in connection with the bidding, negotiation,
award, or performauice or tennination of a contract by one
of those eigencies.
5. Applicant ; Any person who is eligible to have the matter of
granting, revoking, or denying him an access authorization
determined or reconsidered \inder the Industrial Personnel
Access Authorization Review Program a^ provided for in
patragraphs I.F. and V.B.
6. Contractor : An industrial, educational, ccmmercial, or
other entity which has executed a contract or a Department
of Defease Security Agreement (UD Form khl) with a Department
of Defense agency or activity.
7. Personal appearance proceeding : A proceeding before the New
York, Washington, or Los Angeles Industrial Personnel Access
Authorization Field Board convened and conducted in accordance
with this Regulation. The use of the terms "personal
appearance proceeding" or "proceeding" in this Regulation
does not imply, and shall not be construed to raeem, that such
procedures are subject to the provisions of the Administrative
Procedure Act, or that the rules of evidence custcmary in the
courts of the United States shall be applied.
1. The responsibilities of the Department of Defense, including
those imposed by the President in Executive Order IO865,
necessitate application of policies designed to minimize
the possibility of ccrapromise incident to placing classified
Information in the hands of industry. Adequate measui'es
will be taken to insure that no person is granted, or is
allowed to retain, an authorization for access to classified
information unless the avedlable information justifies a
finding that such access authorization, at the specific
classification category granted, is clearly consistent with
the national Interest.
2. A determination that granting or retaining authorization for
access to information of a specific cleisslfi cation category
is not clearly consistent with the national Interest shall
result in denying or revoking authorization for such access.
Any determination under this Regulation adverse to an
applicEint shell be a determination in terms of the national
interest and shall in no sense be a determination as to the
82627 O -62 -7
528 HEARINGS RELATING TO H.R. 10175
loyalty of the applicant concerned. A determination
under this Regulation favorable to an applicant is not,
in and of itself, an access authorization; nor is it in
any sense a determination that the applicant concerned
actually requires access to classified information. Since
an access authorization relates only to access to classified
information, denying or revoking such an authorization does
not preclude participation in unclassified work.
3. In the absence of the power to suhpoena witnesses, the
Secretary of Defense, through the Director, Office of
Industrial Personnel Access Authortzation Review, may issue
in appropriate cases invitations and requests to appear and
testify, and may defray reeisoaable emd necessary expenses
incurred by such witnesses, in order that the applicant may
have the opportunity for cross-examination provided by this
Regulation. So far as the national security permits,
investigative agencies under the control of the Department
of Defense shall cooperate by identifying to the Office of
Industrial Personnel Access Authorization Review, persons
who have made statements adverse to the applicant and by
assisting in making such persons available for cross-
k. All personnel involved in the processing of cases under the
IndustrisLL Personnel Access Authorization Review Program
shall comply with the applicable directives pertaining to
the safeguarding of classified information and the handling
of investigative reports. No classified Information, nor
any information which might canpromise investigative sources
or methods or the identity of confidential informsmts, shall
be disclosed to emy appliceuit, or to his counsel or repre-
sentatives, or to any other person not authorized to have
access to such Information. In cases involving individual
applicants, the employer concerned may be Eidvlsed only of
the final determination in the case and of any interim
decision to suspend em access authorization previously
granted. Except at the written request of the applicant,
the Department of Defense shall not release copies of the
Statement of Reasons or findings relative thereto outside
of the Executive Branch of the Govenment.
The Industrial Personnel Access Authorization Review Program
is hereby revised, modified, and continued in accordance with
this Regulation. The Program shall be administered by the
Director, Office of Industrial Personnel Access Authorization
Review, who shall have a staff for that purpose. The Office
HEARINGS RELATING TO H.R. 10175 529
of Industrial Personnel Access Authorization Review shall
consist of the following elements:
1. The Office of the Director.
2. The IndustriaJ. Personnel Access Authorization Screening Boeird
(hereinafter called the Screening Board).
3. The IndustriaJ. Personnel Access Authorization Field Boards
(hereinafter called the Field Boards).
k. The Central Industria]. Personnel Access Authorization Board
(hereinafter called the Central Board).
F. Scope of Program
1. Except as provided in subparagraph d. of this peursigraph
the procedures estahlished in this Regulation shall be
applicable to caaes in which the applicant is eligible
under the Armed Forces Industrial Security Regulation for
consideration as to the granting or continuing of an access
authorization and in addition thereto:
a. A Department of Defense agency or activity has reccm-
mended that an access authorization of a contractor or
contractor omployee be denied or revoked;
b. A Department of Defense agency or activity has suspended
an access authorization of a contractor or contractor
c. A Department of Defense agency or activity has denied
or withdrawn a temporary access authorization fran an
individual, other than a foreign national, who falls
within such categories £is may be established under this
d. Action is requested by the Secretary of Defense, or the
Secreteury of any milit8u:y department or the Administrator
2. Once access authorization has been suspended, or a Statement
of Reasons has been issued, or a temporary authorization
for access has been withdrawn or denied in the case of
applicemts included in categories established under sub-
paragraph 1., above, these procedures may be invoked by
an applicsuit even though his employment hsis been tenninated.
530 HEARINGS RELATING TO H.R. 10175
A. Office of Industrial Personnel Access Authorization Revlev
a. The Office of Industrial Personnel Access Authorization
Review shall be established in the Office of the Secretary
of Defense and will function under the administrative
jurisdiction of the Assisteuit Secretary of Defense (MF&R).
The Office shall be headed by a civilian Director appointed
by the Secretary of Defense after consultation with the
Assistant Secretaj:^ of Defense (MP&R) and the Secretaries
of the Army, Navy and Mr Force. Policy guidance for the
operation of the program Including manpower and personnel
requirements shall be provided by the Assistant Secretary
of Defense (MP&R). The Director shall be responsible for
administering the Industrial Personnel Access Authorization
Review Program, including its constituent boards; he shall
advise and consult with the Secretaries of the Army, Navy
and Air Force in carrying out this responsibility. He shall
be responsible for ensuring that the Screening, Field and
Central Boards are provided with such advice, assistance
and personnel. Including legal ajid security advice, as he
considers necessary to enable these elements properly to
carry out their functions under this Program. He shall
have such professional, technical, and clerical staff as
he may require to carry out his responsibilities, as set
out herein, and such other related responsibilities as may
be prescribed. The Director is authorized to obtain Infor-
mation, assistance, and advice directly from any agency or
activity of the Department of Defense, and. In accordance
with established policies, from other agencies of the
Government. He shall prepeire monthly reports showing
caseloads and the status of pending cases. The Director
may issue such supplemental instructions, not Inconsistent
with this Regulation, as may be desirable for the
administration and efficient operation of this Program,
including rules for the processing of cases, the conduct
of screenings, personal appearance proceedings, determina-
tions and reviews, and for guidance In the application
of the standard and criteria set forth In peiragraph III.
In any partlculai" case, the Director may request addi-
tional investigation to be made subject to the provisions
of any agreements with investigative agencies outside the
Department of Defense.
b. The Office of IndustrieLL Personnel Access Authorization
Review shall be located in the Pentagon asid shall be
HEARINGS RELATING TO H.R. 10175 531
supported administratively by the Office of the
Secretary of Defense. The military departments shall
make appropriate allocations of funds, military and
civilian personnel, and personnel spaces.
c. Connnuni cations shall be addressed to the Director,
Office of Industrial Personnel Access Authorization
Review, The Penteigon, V/ashington 25, D. C.
2. Department Counsel
The Office of Industrial Personnel Access Authorization
Review shall include within its staff a sufficient number
of qualified attorneys, who may be stationed in Washington,
D. C. or at such other locations as the Director may select,
to act as counsel for the Department of Defense in each case
in which a personal appearance proceeding is held under
this Regulation. When designated by the Director to serve
in this capacity, department counsel sheill perform the
functions normally and custcmarily associated with said
position. Department counsel sheill also advise and assist
the Screening Board eis required, and shall represent the
Department of Defense before the Central Board when
The complete files of all review cases pertaining to
industrial personnel shall be maintedned by the Deparianent
of the Army.
B . Industrial Personnel Access Authorization Scr e ening Boa rd
1. The Screening Board shall be located in the Office of
Industrial Personnel Access Authorization Review and shall
be responsible for the performance of the duties and functions
2. The Secretary of each military department shall appoint one
or more monbers, military or civilian, to the Screening
Board as the caseload requires. Appropriate officials
designated by each Secretary will submit nominations through
the Director, who will review the qualifications of each
nominee and make 6in appropriate recommendation to the
Secretary concerned. Except as provided in paragraph II. F.,
any three members so appointed, one from each military depart-
ment, shall constitute a quorum-panel so that more than one
panel may be convened at the same time. The Director shall
designate one member to serve as Chedrman of the Screening
3. The Screening Board shall have Jxxrisdiction over sill cases
which are referred to it in accordance with this Regulation.
532 HEARINGS RELATING TO H.R. 10175
C. Industrteil Personnel Access Authorization Field Boards
1. There shall he three field hoards, which shall he known
as the New York, the Washington and the Los Angeles
Industrial Personnel Access Authorization Field Boards
and which shall he located In said cities. Additional
field hoards may he established hy the Director with the
approval of the Secretaries of the Army, Navy and Air
Force. Panels of existing Field Boards may he convened
at other locations to provide praapt and convenient
personal, appeetrance proceedings. Each Field Board shall
he responsihle for the performance of the duties and
functions hereinafter prescribed.
2. The Secretary of each military departanent shall appoint
one or more members, military or civilian, to each Field
Board as the caseload requires. Appropriate officials
designated by each Secretary will submit nominations
through the Director, who will review the qualifications
of each nominee and make an ajjpropriate recommendation to
the Secretary concerned. The Director shall designate
either one member of the Board or a staff member to serve
as eu3ministrative director of each Boaird who will be
responsible for the iamediate operations of the Board.
A quorum-panel may consist of any one civilian member who
is a qualified attorney, or of any three members, one from
each military department, of whom at least one shall be a
civilian and at least one shall be a qualified attorney.
When a panel of three members is convened, the administrative
director shcLll designate one member to act as Chairman. A
quoirum-pemel may exercise all of the authority conferred
on the Board or Chairman by this Regulation.
3. Each Field Board will have jurisdiction over all cases
referred to it in accordance with this Regulation.
D. Responsibilities of Military Lepartments for Administrative
1. Except as provided in paragraph 2., the Field Boards shall
be supported eidmlni strati vely by the following military
depeurtments, which shall appoint such other personnel as
may be required by the Director to assist each Field Board:
New York Industrial Personnel Access Authorization Field Board
Depariment of the Army
Weishington Industrial Personnel Access Authorization Field Board
Depeirtment of the Air Force
Los Angeles Industrial Personnel Access Authorization FieldBcard
Department of the Navy
HEARINGS RELATING TO H.R. 10175 533
2. Whenever, pursuant to direction of the Director, a panel
of a Field Board established under paragraph II.C.l., above,
is convened at any of the follovriLng named locations, the
canmanders named, respectively, shaJLl arrange or provide
for the administrative support needed by such board panel
in order to discharge its official business at such locations:
Ccramander, Alaskan Air Ccmmand
Virgin Islands, Canal Zksne, and Puerto Rico:
Commanding General, USA, Carribean
Guam, American Samoa, V/ake, Midway, Guano Island & Hawaii:
Comnandant, lUth Naval District
3- V^iere a panel of a Field Poard is convened at a location
other than its principal office or at a location outside the
jurisdiction of the commanders named in paragraph 2., above,
the military department requested by the Director shall
provide office space, facilities and clerical personnel for
each personal appearance proceeding and for the prompt
making of a verbatim transcript thereof.
h. As a verbatim transcript will be required of each personal
appearance proceeding before a Field Board, it is the
responsibility of each of the above mentioned commanders
to provide the necessary personnel and facilities for the
prompt making of such transcripts.
E. Centred. Industrial Personnel Access Authorization Board
1. There is hereby established a Central Board, which shall be
located in the Office of Industrieil Personnel Access
Authorization Review, and shall be responsible for the
performance of the duties and functions hereinafter
2. The Secretary of each military department shaill appoint one
or more members, military or civilian, to the Central Board
as the caseload requires. Appropriate officials designated
by each Secretary will submit ncminations through the
Director, who will review the q^sdlfi cations of each nominee
and make an appropriate recommendation to the Secretary
concerned. The Director shsLll designate one member to serve
as Chairman of the Central Board. Except as provided in
paragraph II. F., any three members so appointed, one from
each military department, shstll constitute a quorum-panel
so that more than one panel may be convened at the same time.
One of the members of each quorum-panel must be a qualified
lawyer and each quorum-panel shall include at least one
534 HEARINGS RELATING TO H.R. 10175
3. The Central Board shall have Jurisdiction over all cases
referred to it in accordance with this Regulation.
F. Canposition of Boards in Agency Cases
1. Whenever an agency case is referred for consideration and
determination under the Program the Administrators concerned
shall be entitled to api>oint one menber to the Sci*eening
Board and two members to the Central Board. Such appoint-
ments shall conform to the requirements of paragraph II. G.
of this Regulation.
2. Whenever an agency case is referred to the Screening or
Central Boards, the Director shall notify the Administrator
concerned thereof. The Administrator, or his designee,
shall, in their absolute discretion, exercise or waive the
right of his agency to be represented on the Board Involved
and shall notify the Director thereof In writing, which
notification shSLLL be made a permament part of the record
in the case. If the right is exercised, the Screening Board
pemel to which the case is referred shall consist of foiir
members and the Central Board panel of five members, insteeid
of the usual three members; if it is waived the Board shall
be constituted as provided in paragraphs II. B. or II. E., above.
G. Access Authorization of Nominees
No person shall, be appointed Director, board member, or staff
member under this Program until such person has been granted
an authorization for access to Top Secret information, or its
equivsLLent, based on a background investigation.
III. STANIARD AKD CRITERIA
A. Standard for Issuing an Access Authorization
Authorization for access to classified Information of a specific
classification category shall be granted or continued only if it
Is determined that such access by the applicant is clearly con-
sistent with the national Interest.
B. Criteria for Application of Standard in Cases Involving Individuals
1. Ccranission of any act of sabotage, espionage, treason, or
sedition or attempts thereat or preparation therefor, or
conspiring with, or aiding or abetting, another to ccmmit or
attempt to ccramit any act of sabotage, espionage, treason or
HEARINGS RELATING TO H.R. 10175 535
2. Establishing or continuing a sympathetic association with
a saboteur, spy, traitor, sedltionlst, anarchist, revolutionist,
or with em espionage agent or other secret representative of
a foreign nation whose interests may be inlmlcaJ. to the
interests of the United States, or with any person who advocates
the use of force or violence to overthrow the Government of the
United States or the alteration of the form of Government of
the United States by unconstitutional means.
3. Advocacy of use of force or violence to overthrow the Govern-
ment of the United States, or of the alteration of the form
of Goverrment of the United States by unconstitutioneLl means.
k. Membership in, or affiliation or sympathetic association
with, or participation in the activities of any foreign
or dcmestlc organization, association, movement, group, or
ccmbinatlon of persons which is totalitarian, fascist,
canmunlst, or subversive, or which has adopted or shows, a
jxjlicy of advocating or approving the ccnmilsslon of acts of
force or violence to deny other persons their rights under
the Constitution of the United States, or which seeks to
alter the form of Government of the United States by un-
5. Intentional, unauthorized disclosure to any person of
classified information, or of other information, disclosure
of \rtilch is prohibited by law.
6. Performing or attempting to perform his duties, or other-
wise acting, so as to serve the interests of another govern-
ment in preference to the interests of the United States.
7. Participation in the activities of an organization established
as a front for an organization referred to in subparagraph k.,
above, under circumstances indicating that his personal views
were sympathetic to the subversive purposes of such
8. Participation in the activities of an organization with
knowledge that it had been infiltrated by members of sub-
versive groups under circumstances indicating that the
individual was a part of, or sympathetic to, the infiltrating
element or sympathetic to its p\irposes.
9. Sympathetic interest in totalitarian, fascist, ccmmunlst, or
similar subversive movements.
10. Sympathetic association with a member, or members, of an
organization referred to in subparagraph k., above.
536 HEARINGS RELATING TO H.R. 10175
(Ordlnar^.ly, this vlll not include chance or occasional
meetings, nor contacts limited to normal business or
11. Currently medntedning a close continuing association with
a person who has engaged in activities or eissociations of
the type referred to in subparagraphs 1. through 9-, above.
A close continuing association may be deemed to exist if
the individual lives at the same premises eis, frequently
visits, or frequently conmunicates with such person.
12. Close continuing association of the type described in sub-
paragraph 11., above, even though later separated by
distance, if the circumstances indicate that renewal of
the association is probable.
13. Willful violation or disregard of security regulations.
ik. Any behavior, activities, or associations which tend to
show that the indlvidueLI is not reliable or trustworthy.
15. Any deliberate misrepresentations, falsifications or
omission of material facts from a Personnel Security
Questionnaire, Personal History Statement, or similar
16. Any criminal, infamous, dishonest, immoral, or notoriously
disgraceful conduct, habitual use of intoxicants to excess,
drug eiddiction, or sexual, perversion.
17. Acts of a reckless, irresponsible or wanton nature which
indicate such poor judgnent euad instability as to suggest
that the individual might disclose classified information
to unauthorized persons, or othei-wise assist such persons,
whether deliberately or inadvertently, in activities
inimical to the national interest.
18. Any illness, including any mental condition, of a nature
which, in the opinion of competent medical authority, may
cause significant defect in the Judgment or reliability of
the employee, with dae regard to the transient or continuing
effect of the illness and the medical findings in such c6lsc.
19. Any facts which furnish reason to believe that the individual
may be subjected to coercion, influence, or pressure which
may be likely to cause action contretry to the national interest.
20. The presence of a spouse, parent, brother, sister, or offspring
in a nation whose interests may be inimical to the interests
of the United States, or in satellites or occupied areas of
HEARINGS RELATING TO H.R. 10175 537
such a nation, under circumstances permitting coercion
or pressure to be brought on the individual through such
relatives which may be likely to cause action contrajry
to the national interest.
21. Refusal by the individual, without satisfactory subsequent
explanation, to answer questions before a Congressional or
legislative committee, or Federal or State court or other
tribunal, regarding charges of his all eged disloyalty or
C. Guidance for the Application of the Standard and Criteria
1. The activities and associations listed in paragraph III.B.,
above, describe conduct which may, in the light of all the
surrounding circimistances, be the basis for denying or
revoking an access authorization. The conduct varies in
implication, degree of seriousness and signlficeince depending
upon all the factors in a particular case. Therefore, the
ultimate deteimination of whether an authorization should
be granted or continued must be an over-all common- sense
one on the ba^is of all the information which may properly
be considered under this Regulation including but not
restricted to such factors, when appropriate, as the
following: the seriousness of the conduct, its implications,
its recency, the motivations for it, the extent to which it
was voluntary and undertaken with knowledge of the cir-
cumstances involved and, to the extent that it can be
estimated and is appropriate in a particular ca^e, the
probability that it will continue in the future.
2. Legitimate labor activities shall not be considered in
determining whether access authorization should be granted
3. It Is essential, to the efficient, econccilcal, and equitable
operation not only of the Industrial Personnel Access
Authorization Review Program, but of the total procedures
whereby the Department of Defense authorizes access to
classified information, that applicants provide full, frank
and truthful answers when they complete official questionnaires
or other similar documents, or respond to official inquiries.
Accordingly, the deliberate giving of false or misleading
testimony or information on relevant matters, may be
sufficient standing alone to justify denying or revoking
access authorization and shsJLl be weighed carefully before a
detennination is reached under this Program.
h. The granting or continuing of an authorization for access to
a contractor is not clearly consistent with the national
interest if the access authorization of an owner, officer.
538 HEARINGS RELATING TO H.R. 10175
director, or any executive of the contractor who is required
to have such an access authorization, has not been, or would
not be, granted under the stajadard and criteria set forth in
paragraphs III. A. and III.B., above.
IV. PROCESSING OF CASES
A. Bnergency Action
Department of Defense activities or agencies may not make a finad.
determination denying or revoking an authorization for access.
In exceptionsLL cases officials authorized by the military depart-
ment concerned may suspend an authorization previously granted
to £in individual (but not to a facility) when, in the opinion of
the authorized official, the individual's continued access to
classified information, pending action by the Screening Board,
would constitute an immediate threat to the national interest.
Any such suspension action shall be reviewed by the Screening
Board to determine its propriety.
B. Forwarding Cases
DepEtrtoent of Defense activities or agencies shall forward to
the Director all cases prescribed in paragraph I.F.I together
with the complete file, including the recanraendation in the
case, the reasons therefor, and all other available information
and material relevant to a determination. After ens\iring that
the file has been properly prepared and transmitted, the
Director shall forward it to the Screening Board for appropriate
C. Initial Adjudication Procedures (Screening Board Action)
1. The Screening Board shall review each case referred to it
by the Director and sheLLl determine in accordance with the
standard euid criteria set forth in paragraph III idiether
the rejxjrted information warrants (a) authorizing or
continuing to authorize access at the specific classification
category requested or (b) further processing as set forth
2. With respect to any case pending before it, the Screening
Board may request the Director to:
a. Request further investigation, specifying the particular
points on which the Botird feels its information is not
b. Issue to the applicaxit such written interrogatories eus
the Board may deem desirable.
c. Arrange for an interview with the applicant.
HEARINGS RELATING TO H.R. 10175 539
d. Arrange for an interviev with any witness who has
given information relevant to a decision in the case.
3. The Screening Board may, with respect to any case oeaiiing
before it, determine at any time that an existing authoriza-
tion shall be suspeuled. Upou any s>ich detei'-ai nation, the
Director shall notify the applicant, the contractor, the
office of the cognizant military department and the agency
or activity which fonrarded the case to him.
k. If the Screening Board determines that access at the specific
classification category requested should be granted or
continued in effect, it shall prepare its detor-il nation in
accordance with the instructions set out in subparagraph 9.,
below. The Director shall notify the aigency or activity
which forwarded the case to lilm of the determination and
instruct it to effect the authorization where appropriate.
The Screening Board shall reconsider its determination at
the request of the Secretary of Defense, the Secretary of a
militarj'- deijoi'tment, or the Administrator concerned.
5. If the Screening Board concludes on the bfisis of the infor-
mation available to it and In acooriiance with the staadard
and criteria set forth in paragraph III that the case does
not warrant a determination favorable to the applicant, it
shall prepare a Statement of Reasons informing the applicant
of the grounds upon which his acitass authorization may be
denied or revoked. This Statement of Reasons shall be as
comprehensive and detailed as the national security permits.
At the time a Statement of Reasons is issued, any access
authorization previously granted for Secret or Top Secret
shall be suspended or limited to Confidential unless such
access authorization was granted pursuant to board action
under any industrial personnel review program in which case
the Screening Board shall detennine whether the access
authorization should be suspended or limited. The Screening
Board shall also determine whether any access authorization
previously granted for Confidential should be suspended or
6. The Director shall forward the Statement of Reasons and a
copy of this Regulation to the applicant and shall inform
him of the status of his access authorization pending a
final determination. An applicant who has been served with
a Statement of Reasons and who has filed under oath or
affirmation a written reply thereto which complies with the
requirements of paragraph IV. C. 7 shall be afforded:
a. An opportunity to appear personally before a Field Board
for the purpose of supporting his eligibility for access
authorization and of presenting evidence on his own behalf.
540 HEARINGS RELATING TO H.R. 10175
b. A reasonable time to prepare for that appearance.
c. An opportunity to be represented by counsel without
cost to the Government.
d. The opportunity to cross-examine adverse vltnesses
prescribed in paragraph IV. E. 2.
7. Before an applicaxit is afforded an opportunity to make a
personal appearance before a Field Board he must submit a
detailed written answer under oath or affirmation specifi-
cally admitting, denying or disclaiming knowledge of each
allegation and each supporting fact alleged in the State-
ment of Reasons. The applicant's answer must either admit
or deny each auLlegation or supporting fact, giving such
explanation as may be available to him, or disclaim knowledge
thereof. A general denial or other similar answer is not
sufficient. The applicant must set out his position with
sufficient particularity to disclose the basis thereof, in
order that the Department of Defense may determine in ad-
vance of the personal appearemce proceeding whether the
allegations and supporting facts are wholly denied, denied
in part, or wholly admitted and make arrangements to pro-
duce such information in support as may be required. The
Director may decline to accept answers which do not meet
the above requirements and, upon notice to the applicant,
may refuse to continue to process his application. In
that event, the Director shall suspend any access authori-
zation then in effect and give appropriate notice. In the
alternative, the Director may forward the case to a Field
Board which may treat allegations or supporting facts with
respect to -vrtiich the Director finds the answer is insuffi-
cient as established for the purpose of making a determina-
tion under this Program.
8. Where the applicant:
a. Files an answer which complies with subparagraph J.
and requests a personal appearance proceeding, or •vrtiere,
although the answer is insufficient, the Director elects
to proceed as provided for in said subparagraph, the
Director shall assign the case to a Field Board for a
b. Files an answer which complies with subparagraph 'J., but
elects not to request a personal appearance proceeding,
the Director shall assign the case to the Central Board
for determination on the basis of all available infor-
mation including the answer euid all documents in support
HEARINGS RELATING TO H.R. 10175 541
c. Does not answer, the Director shall instruct the
departanent which forwarded the case to deny or revoke
access authorization, as appropriate, and shsdJ. advise
9. All determinations by the Screening Board shall be made in
executive session. A determination to grant or continue
access authorization shall be by unanimous vote. No person
other than members of the Board shall be present when the
Board deliberates and reaches its determination.
10. Decisions adverse to the applicant announced by the Director
in accordance with paragraph IV.C.S.c. may be reconsidered
by the Screening Board at the request of the Director, or
at the request of the applicant addressed through the
Director, after a finding by the Screening Board that there
is newly discovered evidence or that other good cause has
D. Personal Appearance
1. Pronptly after being ijotified by the Director that a case
has been referred for a personal appearemce proceeding, the
Chairman of the Field Board shall set a time and place for
the proceeding and inform the applicant thereof. Personal
appearance proceedings shall be held as soon as practicable,
allowing the applicant and the Depariment of Defense a
reasonable time to prepare. Postponements may be granted by
the Chairman in his sound discretion upon application by
either party with notice to the other.
2. Normally, a personal appearance proceeding shall be held at
the heme office of the Field Board concerned. When the
applicant so requests and when in the discretion of the
Chainnan equity to him requires that the proceeding be held
in a different place, or when the interests of the Government
would be served thereby, Field Boards, subject to the over-all
authority of the Director, may arrange to convene at such
times and places as will best meet the above objectives.
3. It is to the advantage of both the applicant and the Department
to shorten and simplify the proceedings before the Field Board
by stating the issues and arriving at an agreed-upon version
of the facts in the case when it is possible to do so. Depart-
ment counsel is authorized to consult directly with the
applicant, or if he has counsel or representative, with them,
for purposes of reaching mutual agreement upon arrangements
for an expeditious proceeding in the ceise. Such arrangements
may include clarification of issues, and stipulations with
respect to testimony and the contents of documents and other
542 HEARINGS RELATING TO H.R. 10175
physical evidence. Such stipulations when entered into
shall be binding upon the applicant and the Department of
Defense for the purpose of these proceedings.
k. The applicant is responsible for producing witnesses in his
own behalf or presenting other evidence before the Field
Board to support his reply to the Statement of Reasons. When
specific assistance is requested, however, the department
counsel and the Chairman of the Field Board may provide such
assistance, upon a showing that it is practicable and necessaiy.
In the Chairman's sound discretion, invitations to attend the
proceeding as witnesses in the applicant's behalf, or requests
for specific documents or other physical evidence, may be
tendered upon application, provided a showing of the necessity
for such assistance has been made.
5. Department counsel is responsible for producing at the
proceeding witnesses and information relied upon by the
Department to establish those facts aJ-leged in the Statement
of Reasons which have been controverted. Every reasonable
and practicable effort shall be made to obtain witnesses and
to facilitate their appearance in accordance with the policy
set out in paragraph I.D.3. When requested all Department
of Defense agencies and activities shall cooperate in
carrying out this policy.
6. ^There an applicant who has requested an opportunity to appear
falls without sufficient reason therefore to appear at the
time and place set for the proceeding, or at any postponement
thereof, and has not requested that his case be determined on
the basis of all available information including any written
material he may have submitted, the Field Board shall return
the case to the Director without further action. The Director
shall then take action under paragraph IV.C.8.C.
E. Procedures for Personal Appearance Proceedings
1. General Provisions
a. Personal appearance proceedings are designed to ascertain
all the relevant facts in a case to aid in reaching fair
and impartial determinations. Such proceedings are not
to be conducted with the formality of a court proceeding
or of an administrative hearing conducted under the
Administrative Procedure Act, but rather as administrative
inquiries held for the purpose of affording the person
concerned ein opportunity to appeetr for the purpose of
supporting his eligibility for an access authorization
and to permit the Department of Defense to inquire fully
into the matters related to the parti culau: ca^e. As
HEARINGS RELATING TO H.R. 10175 543
provided in paragraph IV.E.2.a., the customary rules
of evidence shall not be controlling.
Personal appearance proceedings conducted under this
Regulation are not adversary in nature. Nevertheless,
a careful and searching inqiiiry into the facts is
necessary if the objectives of this Regulation are to
be effectuated. Field Boards shall be alert to the
necessity for identifying and resolving disputed issues
of fact whenever possible and sha3J. make their rulings
with these considerations in mind.
Personal appearance proceedings shall be conducted in
an orderly manner and in an atmosphere of dignity and
decorum. They may be attended only by the members of
the Field Board, the applicant and his counsel or
representatives, authorized personnel of the Department
of Defense and necessary clerical personnel. Unless
the Chairman of the Field Board rules otherwise, a
witness may be present only when he is testifying.
The Director shall designate a qualified attorney to
represent the Department of Defense and to act as
department counsel in each case. He shall represent
the Department, and shall be responsible for making a
conrolete record and for placing before the Field Board
all material which may properly be incorporated therein.
He shall question Department of Defense witnesses and
cross-examine witnesses produced by the applicant,
although the Field Board may also question any witness.
After the proceeding has been convened, and the Statement
of Reasons and the applicant's answer thereto have been
entered into the record, normally the applicant shall
have the right to make a general opening statement
either in person or by counsel, and to present his case.
He may call witnesses, testify in his own behalf if he
so desires and present documents, or other information,
in support of his application for access authorization,
and cross-examine witnesses produced by the Department
Witnesses before the Field Board shall testify subject
to the provisions of Sec. 1001, Title l8, U.S. Code.
Before testifying they shall be informed that said
section makes it a criminal offense punishable by a
maximum of five years imprisonment, $10,000 fine, or
both, knowingly and willfully to make a false statement
544 HEARINGS RELATING TO H.R. 10175
or representation to axiy depcLrtanent or agency of the
United States eis to any matter within the jurisdiction
of any depsLrtment or agency of the United States.
Written interrogatories must be sworn to before a notary
public or other official authorized to administer oaths.
g. When appropriate the Field Boeurd shall amend the Statement
of Reasons to confonn it with the information available
and enter the amendment into the record. When such
amendments eire made, the Chairman of the Field Board shall
grant the applicant such additional time as, in his sound
discretion, he deems appropriate to answer such amendments
and to secure and present evidence pertaining thereto.
h. The Field Board may recess the proceeding at any time
at the request of the applicant or his counsel, depart-
ment counsel, or upon its own motion.
i. Before the Chsdrman of the Field Board adjourns the
proceeding, he shall ask the applicant whether he desires
additional time to secure and present additional evidence
or to submit a brief. If the applicemt desires to present
such additional material, the Field Board shall determine
the time within which it must be presented and the form
in which it will be received. The Chairman shall eQ.so
advise the applicant that einnouncement of the determination
in his case will be made by the Director, Office of
Industrial Personnel Access Authorization Review.
J. A verbatim transcript (in triplicate) sheill be made of
the proceedings and such transcript shall beccme a
permement part of the record. The transcript shall not
include information introduced in accordance with the
provisions of paragraph IV.E.2.e. and f., below. The
applicant or his designated representative shall be
furnished without cost one copy of the transcript, less
the exhibits, upon his request. The transcript shall be
reviewed by the Board prior to release to ensure that it
contains no classified information, nor any information
which might ccmprcmise investigative sovu:ces or methods
or the identity of confidential informants.
k. If the applicant or his counsel desires to submit
corrections in the treinscript to the Field Board, he
sheLll note the corrections on a separate statement
designating the page and line. The statement of
corrections must be filed within the time set by the
Field Board which shall determine what corrections aj^
allowable, shall enter on the transcript by margineLL
notation the corrections which are allowed, and shall
HEARINGS RELATING TO H.R. 10175 545
enter on the statement filed by the applicant the
corrections which are rejected. This statement shall
be made a permanent part of the record. The Chairman
of the Field Board in his discretion may call upon the
applicant or his counsel for a discussion of the
corrections. Corrections shall be allowed solely for
the purpose of conforming the transcript to the actual
1. Whenever the Field Board concludes with respect to an
issue of fact that the investigation is inadequate or
that all of the information has not been fully developed
or explored, it may request that further investigation
be conducted and in appropriate cases may recess the
proceeding pending such investigation. Such requests
shall be addressed to the Director through the department
counsel. Information developed through supplemented,
investigation shall be mside available to the Board in
the same manner as information developed in the original
2. Introduction of Information
a. The record shall consist exclusively of all information
presented by the Deparianent of Defense in accordance
with this Regulation, together with all information sub-
mitted by the applicant. The record sheill not be limited
to evidence admissible in the courts of the United States.
Any oral or documentary evidence may be received if
otherwise admissible under this Regulation and accorded
the weight deemed appropriate, but irrelevant, immaterial
or unduly repetitious material may be excluded, in the
sound discretion of the Chairman of the Field Board.
Efforts shall be made to obtain the best evidence available.
b. Unless permitted by paragraphs e. and f., below, the
record may contain no information adverse to the
applicant on amy controverted issue unless (l) the
information or its substance has been made available
to the applicant and he offers no objection to its
presentation; or (2) the information or its substance
is made available to him and the applicant is afforded
an opportunity to cross-examine the person providing the
infoiroation either orally or by written interrogatories.
The foregoing shall not apply to information bearing upon
the characterization in the Statement of Reasons of any
orgamzation or individual other than the applicEint.
Information the admission of which is not prohibited by
this paragraph, or by any other provision of this
Regulation, may be received and made part of the record
and may be considered by any board or official charged
with making determinations under this Regulation.
546 HEARINGS RELATING TO H.R. 10175
c. Prior to the referral of a case to a Field Board
for a personal appearance proceeding, the Director,
Office of Industrial Personnel Access Authorization
Review, upon application by either the applicant or
the department counsel, shall nile whether, in the
light of all the circumstances, testimony shall be
taken personally, by deposition, or through cross -
interrogatories. In making this ruling, the Director
shall exercise his sound discretion and shall state
his reasons therefor. He may direct the applicant
or his counsel, and department counsel to frame written
interrogatories and upon application by either party
shsill rule upon the i^levancy and materiality of any
question to be incorporated therein. Once the csise
has been referred to the Field Board, the Chairman of
the Field Board shall perfonn this function. Any action
taken by the Director under this peuragraph shall be
reflected in the record where appropriate.
d. Notwithstanding any other provision of this Regulation,
records compiled in the regular course of business, or
other physiceQ. evidence other than investigative reports
as such, may be received and considered subject to
rebuttal without authenticating witnesses, provided
such information has been furnished by an investigative
agency pvirsuant to its responsibilities in connection
with eissisting the Secretary of Defense or the
Administrator of the Federal Aviation Agency or the
NationsQ. Aeronautics and Space Administration to safe-
guard classified information within industry pursuant
to Executive Order IO865. Such documents shall be
exhibited to the applicant and when received by the
Field Board shall be made a part of the record in the
e. Records ccmplled in the regular course of business, or
other physical evidence other than investigative reports
as such, relating to a controverted issue, which, because
they are classified, may not be inspected by the
applicant, may be received and considered provided that
(1) the Secretary of Defense or when appropriate, the
Administrator of the Federal Aviation Agency or the
National Aeronautics and Space Administration, or the
Director, Office of Industrial Personnel Access
Authorization Review, who has been designated as their
special designee for that purpose pursuant to Section 5^(^)^
Executive Order IO865, has made a preliminary determination
that said physical evidence appears to be material, eind
that failure to receive and consider it would, in view of
the level of access sought, be substantieilly harmful to
HEARINGS RELATING TO H.R. 10175 547
the national secnirity, and (2) to the extent that the
national security permits, a Guramary or description of
said physical evidence shall be made avedlable to the
applicant. In every such case, information as to the
authenticity and accuracy of such physical evidence
furnished by the investigative agency involved shall be
A vrriTJten or oral statement by a person adverse to the
applicant on a controverted issue, and not relating to
the characterization in the Statement of Reasons of
any organization or individual other than the applicant,
may be received and considered without affording an
opportunity to cross-examine the person making the
statement only in circumstances described in either of
the follovilng subparagraphs, provided however, that a
svunmary of the statement as comprehensive and detailed
as the national security permits shaJJL be made available
to the appllcsuit:
(1) The head of the departoent supplying the statement
certifies that the person who furnished the infor-
mation is a confidential informant who has been
engaged in obtaining intelligence information for
the Government and that disclosure of his identity
would be substantieLLly harmful to the national
(2) The Secretaj^y of Defense or when appropriate, the
Administrator of the Federal Aviation Agency or
the National Aeronautics and Space Administration,
or the Director, Office of Industrial Personnel
Access Authorization Review, who has been designated
as their special designee for that particular
jnirpose pursuant to Section h (a), (2), of Executive
Order IO865, has preliminarily determined, after
considering information furnished by the investigative
agency involved as to the reliability of the person
and the accuracy of the statement concerned, that
the statement concerned appears to be reliable and
material, emd has detennined that failure to receive
and consider such statement would, in view of the
• level of access sought, be substantially harmful
to the national security and that the person who
furnished the information cannot appeeir to testify
(a) due to death, severe illness, or similar cause,
in which case the identity of the person and the
information to be considered shall be made available
to the applicant, or (b) due to some other cause
548 HEARINGS RELATING TO H.R. 10175
determined by the Secretary or the Deputy
Secretary of Defense, or when appropriate, by
the Administrator or Deputy Administrator of the
Federal Aviation Agency or the llationaJ. Aeronautics
and Space Administration to be good and sufficient.
g. A written or oral statement of a person relating to the
characterization in the Statement of Reasons of any
organization or individual other than the applicant may
be received and considered without affording the applicant
an opportunity to cross-examine the person making the
statement, irrespective of whether the statement is
adverse to the applicant or relates to a controverted
issue, provided the applicant is given notice that it
has been received euid may be considered by the Board,
and is informed of its contents to the extent permitted
by paragraph I.D.U., above.
h. Whenever information is made a part of the record under
the exceptions authorized by subpeiragraphs e. or f . (l)
or (2), the record shall contain certificates evidencing
that the determinations required therein have been meuie.
Such certificates shsLLl include the reasons therefor and
shall be made available to the applicant unless their
disclosure is prohibited by paragraph I.D.i*-., above.
i. In any case where information is received by the Field
Board pursuant to subparagraphs e. or f. (l) or (2), a
final determination eidverse to the applicant in a
Department of Defense case shall be made only by the
Secretary of Defense, and in an agency case by the
Administrator of the Federeil Aviation Agency or of the
National Aeronautics and Space Administration, as
appropriate, based upon their personal review of the case.
F. F ield Board's Report
1. As promptly as possible after the proceeding and after full
consideration of the record and of any arguments made or
briefs submitted, the Field Board shall prepare a report
which shall include a recoramended decision in the ca^e,
prepetred in accordance with the standard and. criteria set
forth in paragraph III. The Field Board's report shall
contain a recitation, of the questions presented, a summary
of the evidence received, findings of fact with respect to
each allegation made, and its conclusion on each question
presented for consideration. The Field Board's report shall
be forwarded through the Director to the Central Industrial
Personnel Access Authorization Boetrd. The report sheuLL not
be made available to the applicant. —
HEARINGS RELATING TO H.R. 10175 549
2. Whenever an applicant has made a personal appearance before
a Field Board, a decision adverse to him may be made only
on grounds stated in the Statement of Reasons emd any
amendments thereto and must be based upon a record that is
in conformity with Executive Order IO865 and this Regulation.
A Field Board or the Central Hoard may not receive or
consider any information with respect to any fact in issue,
unless such information is made available to such Board in
accordance with this Regulation.
3. In every case where applicable, the Field Board shall give
appropriate consideration to the fact that the applicant
did not have the opportunity to inspect classified infor-
mation or to identify or cross-examine persons constituting
sources of information. It shall also give appropriate
consideration to whether infonnation was given under oath
or affirmation, and whether or not the person concerned has
had an opportunity to rebut it. In every case where
classified physical evidence is involved, information as to
the authenticity and accuracy of said physiceil evidence
furnished by the investigative agency shall be considered.
Action by the Central Industrial Personnel Access Authorization
1. Whenever a case is referred to the Central Board, it shall
make a final determination subject to the provisions of
pareigraph IV. 1. 3. in cases which do not fall within the
provisions of paragraphs IV.E.2.e. or IV.E.2.f. (l) or (2),
specifying the specific category of classified information
to which access shall be granted or continued where
2. In cases where the provisions of pareigraphs rV.E.2.e. or
IV.E.2.f. (1) or (2) apply, the Central Board shall (a)
prepare a final determination where the decision is to grant
or continue access at the specific classification category
requested, or (b) where it concludes that access at that
specific classification category is not warranted, it shall
so notify the Director.
3. Before the Central Board meikes a final decision, it shall
take the following action, as applicable:
a. If the Board reaches a tentative decision adverse to
the applicant, it shall, through the Director, give
550 HEARINGS RELATING TO H.R. 10175
notice thereof to the applicant tocether vd.th notice
of its proposed findings for or against him with
respect to each allegation in the Statement of Reasons,
and shall provide him vrLth an opportunity to make an
appearajice before it, in person or by counsel, or to
file a written brief. Within ten (lO) calendar days
after his receipt of such notice, the applicant may
file with the Board a written notice of intention to
appear or to file a written brief. If the applicant
files such written notice of intention, the Board shall
fix as early a date as practicable for filing a written
brief or making a personal appearance before it, and,
through the Director, shall give notice theireof to both
the applicant and department counsel and at the same time
shall furnish depsirtment counsel with copies of the
tentative decision and proposed findings as previously
furnished to the applicant.
b. If the Board reaches a tentative decision favorable to
the applicant it shall, through the Director, give notice
thereof to the department counsel together with notice of
its proposed findings for or against the applicant with
respect to each allegation in the Statement of Reasons,
and shall provide department counsel with an opportunity
to maJie an appearance before it, or to file a written
brief.. Within ten (lO) calendar days after receipt of
this notice, department counsel may file with the Board
a written notice of intention to appear or to file a
■y/ritten brief. If depsirtraent counsel files such written
notice of Intention, the Board shall fix as early a date
as practicable for filing written brief or making personal
appearance before it, and, through the Director, shall
give notice thereof to both department counsel ajnd the
applicant and at the same time shall furnish the
applicant with copies of the tentative decision and
proposed findings as previously furnished to department
c. Personal appearances before the Central Board and written
briefs filed vrLth the Central Board are intended to permit
the applicant and department counsel to present their
positions based exclusively upon the record made before
the Field BoEird, and shall not be used as a substitute
for proceedings before such a Board. Argument may be
made, but witnesses sheill not be heard eind testimony
shall not be taken.
d. Under a. and b., above, when the applicant or departaient
counsel, as the case may be, has filed a written notice
HEARINGS RELATING TO H.R. 10175 551
of intention, the other shall be entitled at the
designated time to appear personally or file a written
brief as he may prefer. Failure by blm to utilize this
opportunity shall be deemed a waiver thereof.
e. After the applicant and department counsel have sub-
mitted written briefs or appeared before the Centrsil
Board, as provided in subparagraphs a. and b., above,
the Board shall reach a final determination in all
cases in which it is authorized to do so, and shall
refer all other cases to the Director for action by
him in accordance with peiragraph H., below. If the
applicant under subparagraph a., above, or department
counsel under subparagraph b., above, fails to file
written notice of intention, or fails, after filing
such notice, to appear or file a written brief in a
timely manner, the tentative decision of the Board
shall automati cal 1 y become final in all cases in which
the Board is authorized to make a final deteimi nation
emd notice thereof shall be given in accordance with
paragraph I., below; in all other cases the tentative
decision shall be referred to the Director for action
by him in accordance with paragraph H., below.
h. In reaching a determination or conclusion as hereinabove
provided, the Central Board may adopt, modify or reverse
the findings, conclusion, or recommendation of the Field
Board, or may request further Investigation or may return
the case through the Director to the Field Board with
Instructions to take further testimony or conduct other
proceedings. In each case it shall consider the matters
set out in paragraph IV. F. 3., above.
5. In cases in which it is authorized to reach a final
determination, the Central Board shall prepeire an opinion
which shall include an aneilysls of the evidence, findings
of fact and the reasoning on which the determination is
based. The determination shall be reached by majority
vote, shall be signed by the members, and made a permajient
part of the record in the case. If a determination is not
unanimous, a minority opinion shall be filed,
H. Action by the Secretary of Defense or the Administrators
Whenever a case falls within the provisions of paragraphs
IV.E.2.e. or IV.E.2.f . (l) or (2), and the Central Board con-
cludes that access at the specific classification category
requested is not warranted, the Director shall forward the
case to the Secretary of Defense or the Administrator of the
82627 O -62 -8 -
552 HEARINGS RELATING TO H.R. 10175
Federal Aviation Agency, or the national Aeronautics and
Space Administration as appropriate for detemi nation. The
determination shall include a review of any determinations
made pursuant to paragraph IV.E.2.f. (2) (b) by any official
other than the Secretary or the Administrator.
I. Procedure after final determinations
1. Final determinations reached by the Central Board shall be
announced by the Director who shall notify the applicant of
the determination in his case. Where the determination is
favorable to the applicant he shall be notified only of
the final conclusion reached, \7here the determination is
adverse to the applicant, he shall be notified of (l) the
final conclusion reached, and (2) whether a finding was for
or against him with respect to each allegation in the State-
ment of Reasons. The Director shall also give appropriate
notice to the other parties concerned.
2. Final determinations reached by the Secretary of Defense or
the Administrator concerned shall be announced by the Director.
Where the detenni nation is favorable to the applicant he shall
be notified only of the final conclusion reached. V.Tiere the
determination is adverse to the applicant, he shall be
notified only of (l) the final conclusion reached and (2)
whether a finding was for or against him with respect to
each allegation in the Statement of Reasons. The Director
shall also give appropriate notice to the other parties
3. Determinations of the Central Board shall be final subject
a. Reconsideration on its own motion, or at the request of
the applicajit, addressed through the Director, after it
has made a finding that there is newly discovered
evidence or that other good cause has been shown;
b. Reconsideration by the Central Board at the request of
the Secretary of Defense, the Secretary of any military
departjTient, the Director, or when appropriate, the
c. Reversal by the Secretary of Defense or in agency cases
reversal by the Administrator concerned after consultation
with the Secretary of Defense.
J. Authority of the Secretary of Defense, and the Administrators,
Federal Aviation Agency £: National Aeronautics and Space
Nothing conteiined in this Regulation shall be deemed to limit
HEARINGS RELATING TO H.R. 10175 553
or affect the responsibility and powers of the Secretary of
Defense or of any Administrator personally, and without respect
to this Regulation, to deny or revoke an access authorization
in a case affecting his department or agency when he personally
detennines that the provisions of this Regulation caiinot be
invoked consistent with the national security and that the
security of the nation requires such denial or revocation of
access authorization. Such determination shall be conclusive.
A. Pending Cases
All cases presently pending in the Office of Industrial Personnel
Access Authorization Review or before any board constituted under
any IndustriaJL personnel review program shall be processed under
this Regulation unless a Statement of Reasons has been issued in
the case and the applicant has been afforded a personal appearance
proceeding substantially in accordance with the provisions of
B. Reconsideration of Prior Decisions
1. Decisions rendered under any industrial personnel review
program prior to the effective date of this Regulation
which denied or revoked an access authorization may be
reconsidered by such boards as the Director deems appropriate
at the request of the applicant, addressed through the
Director, after a finding by the appropriate board that there
is newly discovered evidence or that other good cause has
been shown. Whenever a final determination of denlEil or
revocation based upon a personal appearance proceeding is
found to have been unauthorized at the time it was made,
authority is hereby delegated to the Director, Office of
Industrial Personnel Access Authorization Review, to vacate
such final determination and all subsequent administrative
action predicated thereon and to take such other steps as
may be deemed necessary to complete reconsideration of the
2. In cases where an access authorization has been previously
granted and a Department of Defense agency or activity
receives additional derogatory information which was not
considered by a boaird at the time it decided the case, such
agency or activity, wlien it is of the opinion, after reviewing
the complete file including the record of any prior proceedings,
that revocation of said authorization is wanranted, shall
forward the case to the Director through appropriate channels
for referral to the Screening Board in accordance with
554 HEARINGS RELATING TO H.R. 10175
C. Monetary Restitution
If an applicant sviffers a loss of earnings resulting directly
fron a suspension, revocation, or denial of his access authoriza-
tion, and at a later time a final administrative determination is
made that the granting to him of an access authorization at least
equivalent to that which was suspended, revoked or denied, would
be clearly consistent with the national interest and it is
determined by the board making a final favorable determination
that the administrative determination which resulted in the loss
of earnings was unjustified, reimbursement of such loss of earnings
may be allowed in an amount which shall not exceed the difference
between the amo^Ant the applicant would have earned at the rate he
was receiving on the date of s\ispension, revocation, or denial of
his access authorization and the amount of his interim net
earnings. The filing and processing of any such claim shall be
in accordance with such regulations as the Secretary of Defense
may prescribe after consultation with the Administrators. Payment
shall be limited to claims administratively determined to be just
and equitable. No applicant shall be compensated for any increase
in his loss of earnings caused by his voluntary action in xmduly
delaying the processing of his case under any industrial personnel
review program. Payments under this provision shall be in full
satisfaction of any and all claims, of whatever nature they may
be, which the applicant has or may assert against the United
States, or the Department of Defense or any of its agencies or
activities, or the Federal rvviation Agency, or the National
Aeronautics and Space Administration, or any of them, by reason
of or arising out of the svispension, revocation or denial of
D. Effective Date
This Directive is effective immediately.
Secretary of Defense
Enclosure - 1
Executive Order IO865 ( See App. pp. 519)
Baldwin, Barbara B 490
Bartimo, Frank A 1 450-500 (statement)
Brawner, (Rachel) 478
Doherty, John F 504-518 (statement)
Eisenhower, Dwight D 522,524
Fuchs, Klaus 514
Gates, Thomas S., Jr 554
Goldberg, Arthur J 500-503
Greene, Jean Hiuton (formerly Mrs. William L. Greene). (See Hinton,
Greene, William Lewis 452,
455, 458-460, 463, 468-^70, 477-479, 481-495, 501, 504, 506
Gressman, Eugene 490
Hinton, Jean (formerly Mrs. William L. Greene) 483
Hoover. J. Edgar 494, 516
Hull, Harry M 490
Jackson, James E 516
Keech, Raymond B 490
Kreznar, Stephen L 477
Lautner. John 45I, 509
Lewis, Herbert 4.58-500 (statement)
MacClain. George 458-.500 (statement)
MacGuineas, Donald B 490
Maroney. Kevin T .504-518 (statement)
Martin, William H 452
McElroy, Neil H 452.
455, 458, 468-470, 477, 478, 488, 490, 501, .504
Mitchell, Bernon F 452
Nixon, Russell Arthur (Russ) 511
Ovchinnikov, Constantine I 483
Rosenberg (Ethel) 514
Rosenberg (Julius) 514
Skallerup, Walter T., Jr 458-500 (statement)
Vance, Cyrus R 456
Warren, Earl 452, 453, 468, 488
Yeagley, J. Walter 466, 483, 504-518 (statement)
Cafeteria and Restaurant Workers Union, AFL-CIO, Local 473 478
Communist Party of the United States of America 4.51,509,513-516
Congress of Industrial Organizations (CIO) 466
Metropolitan Broadcasting Corp 483
Southern Conference for Human Welfare 483
U.S. Government :
Bureau of the Budget 466
Defense, Department of 454^.500. 52.5-.554
District Court, District of Columbia 490
Justice, Department of 494, .504-518
Labor, Department of 500-.503
Subversive Activities Control Board ,515
Supreme Court 452, 455, 459, 481, 488, 491
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