is very easy to live in your own bubble and know what you know and to have access to the things that you have access to. but i think it's also important to think about situations other people are in. and how laws might affect them. host: martin williams, story editor for "mother jones." appreciate you coming on and appreciate all the "mother jones" reporters and editors who joined us this morning. angst for doing it. that is our chauffeur today. we will see you tomorrow at 7:00 a.m.. we will send you to the senate homeland affairs [captioning[cay national captioning institute] committee. performed by national captioning institute] [captions copyright national cable satellite corp. 2013] >> the circumstances that led to this tragedy are multidimensional. many issues raised by the tragedy such as the accuracy of our gun laws and the quality of

our mental health care are outside the purview of this committee. as we have learned more about aaron alexis, a number of my colleagues and i have been asking each other why a troubled unstable individual possessed a security clearance from the united states government. why was he originally granted a security clearance when he did not disclose his arrest record on his application? why did the investigator responsible for looking into that arrest write up that alexis had, quote, retaliated by deflating someone's tires instead of disclosing that alexis had shot those tires? we also wonder how such violence could have taken place in the navy yard which is more secure than just about any workplace in our country. the navy yard is not the only reason members of congress are questioning the quality of the background checks. the edward snoweden case raises many of the -- snowden case

raises many of the questions. and so does the wiki leaks. just yesterday we learned that the department of justice has joined a lawsuit against a company called united states investigations services, commonly known as usis. this is a company that formed about 45% of the background investigations that are contracted out by the office of personnel management. according to this lawsuit, usis engaged in a practice that company insiders referred to as dumping. some refer to as flushing. under this alleged scam they would send investigations back to the office of personnel management even though they had not gone through the full review process. through this dumping, usis maximized its profits. many national security experts have long argued the security clearance process is antiquated and in need of modernization. given recent events i think we have to ask whether the system

is fundamentally flawed. we should also be mindful for many years both congress and the federal agencies were concerned about the backlog of security clearance applications, which grew larger after 9/11. we need to make sure that investigators do not feel pressured to sacrifice quality for speed. many have heard me say that almost everything i do i know i can do better. same is true i think for all of us, and most of our federal programs. it is in that spirit we convene today's hearing. our primary purpose is to learn what we are doing right in the security process, while also learning how we can improve it. we have many questions to ask. here's some of quem. are we looking at the right risk factors in attempting to identify people who should not be trusted with a clearance or who should do serious harm for our government and our country?

what important information do background checks miss in the current system which relies heavily on self-reporting by the individuals applying for our clearance? once a clearance is granted, what events should trigger a re-examination of an individual's suitability to retain that clearance? what problems are created by the heavy reliance by the office of personnel management on contractors to perform the background checks? what are the advantages of that reliance? what is the relationship between background checks for security clearances and background checks for other types of privileges? such as access to governmental facilities? we also need to ask what impacts sequestration and years of strained budgets have had on the clearance process. under the current system, periodic reinvestigations of investigation holding clearances are supposed to be done every five years for people with top secret clearances, and every 10 years for people with secret

clearances. however, because of funding shortfalls, employees sometimes continue to work in positions that have access to classified information even if the initial period of clearance has lapsed. for example, this summer for 10 weeks the department of defense has been in periodic reviews of some contractor employees due to funding shortfalls. i'd like to hear from our witnesses today about how often suspensions like that are happening across the federal government. i'd also like to hear about what agencies are doing to manage risks to our security clearances -- when clearances are not re-examined on schedule through the periodic review process. today we have been joined by officials from four agencies responsible for the policies and procedures used to determine who is eligible to obtain security clearance and access to government facilities and computers. they are the office of management and budget. the office of personnel management. the office of the director of

national intelligence. and the department of defense. we want these officials to talk with us this morning about the critical security related policies and procedures and also the coordinated reviews of these processes now under way throughout the government in the aftermath of the navy yard tragedy and other resent incidents. we also will hear from an exsert at the government accountability office, affectionately known as go gorks which has produced a wide body of work on the security clearance process, welcome. this hearing goes on the ongoing good work of our subcommittees which held a hearing on security clearances just this past june under the able leadership of senators tester, mccaskill, and johnson. that hearing exposed the urgent need for additional resources for the inspector general at the office of personnel management to enable the -- that i.g. to conduct important oversight of

background investigations. in july, our committee approved a portion of a bill sponsored by senator tester and co-sponsored by dr. coburn, senator mccaskill, senator portman, begich, johnson, nellson, and senator bachus, to allow the inspector general to tap into o.p.m.'s revolving fund to perform the much needed oversight. we commend our colleagues for their good work. legislation passed the senate earlier this month. my hope is it will be signed into law by the president soon. in closing, i want to say that the vast majority of individuals who hold security clearances are honorable and trustworthy people. many of them felt called into service after 9/11 to help protect our country, and they deserve our thanks. having said that, though, we still must have a system that does a better job of rooting out those with in fairous purposes and those who have become deeply

troubled and unstable. that system must identify those with behavior signals and when that system must identify those whose behavior signals are unacceptable risk to be trusted with classified information or access to sensitive federal facilities. i hope that our hearing today will help point us to a number of sensible solutions that taken together will truly improve our national security. finally, i think it's important to note that our committee continues to look at our aspects of the navy yard tragedy, including the physical security of federal buildings, as well as preparedness, emergency response, and communication issues. so with that much work to do to learn as much as we can from this tragedy. and try to prevent similar one from occurring in the future. let me welcome back dr. coburn and say i look forward to his opening comments. then we'll turn to our witnesses. welcome. >> thank you, chairman carper.

welcome to our witnesses. first, let me extend our deepest condolences to the families, co-workers, families, and friends to those lost on september 16. to me this isn't a political issue, this is an issue of ulls failing to do our job in a proper way when it comes to security clearances. today g.a.o. is releasing a report. it just shows some 8,400 people receive security clearances, while they had tax debts, which is a vulnerability, got security clearances. and the vast majority of those were top secret security clearances. so our process is obviously broken, not complete, and not adequate. until this year, o.p.m. did not even have the means to debarring persons or falsified background checks, worse o.p.m. irges g.

recommended 22 individuals, have received no answer on 14 cases and informed the other eight will not be debarred. something is very wrong. it's unlikely a stricter clearance process would have prevented a deranged individual from committing murder. but this event should be a katjacy -- catalyst for congress to ways they grant access to sensitive material. two problems, one, there is way too much stuff that's classified that doesn't need to be classified. and number two, there's way too many security clearances approved. so if you markeredly increase the -- markedly increase the people that doesn't need to be classified, you have to increase the number of people. we need to address both problems. i look forward to going through the comments today with our panel witnesses and get closer to the real answers. chairman carper, i thank you again for holding this hearing. appreciate the work of senator tester.

>> i thank you, doctor. i asked senator tester, before we return to witnesses, to make comments as well. >> i would like to thank -- thank you, chairman carper. i want to thank dr. coburn for his leadership on this issue as well. it was four months ago when we had a hearing after the snowden leaks, stephen lewis and brenda were part of that panel. i want to thank you for being here today as well as the last time. in my opening remarks, given the fiscal security stakes involved we ought to get it right, and there was no margin for error. the fact was as we knew then as we know today, we need to make immediate reform of the process, there needs to be more transparency, there needs to be more oversight. the outcome of that hearing was a bill that the chairman talked about, introduced by myself, as well as portman, mccaskill, johnson, and coburn. it a provision of that

legislation known as the square act subsequently passed the senate. when the senate signed it into law it will bring better oversight to the background investigations conducted by o.p.m. and its contractors. but there are two other provisions that are also very, very important. that we need to get across the finish line that dealt with the issues that senator coburn talked about with the number of security clearances given and, quite frankly, another issue that deals with what we do when we have a company that screws up and screws up with some regularity is too important. we saw that with the attacks on september 16 when 12 good men and women left for home as they did most every other monday morning within a couple hours, no warning, no motive. they were killed by man with a history of mental illness, a pattern of violent behavior, and criminal record. a man who was cleared by our

government through a contractor as someone who should have access to this nation's most secure facilities and sensitive information. look, there are real life consequences for failures within our government. and we need answers, we need solution, we need action because, quite frankly, the men and women who rely on that action deserve no less. i would just say, thank you, mr. chairman, for having this hearing. it would seem to me that it is critically important that we act as efficiently and as thoughtfully as possible to get this problem solved because it is obviously a problem and a big one. >> thank you. thanks for your leadership and your good work and that of senator portman and others who joined you. i'll turn to our panel and introduce each of our distinguished witnesses. first witness is the honorable

joseph jordan, administrator of the office of federal procurement policy at the office of management and budget. who do you report to? >> i report to beth coburn, the newly confirmed deputy director. >> i want to thank dr. coburn and others. senator johnson and others, john cornyn was very helpful in trying to expedite. we got through it almost in record time. >> we appreciate it. >> sylvia has a top flight leadership team there. expect a balanced budget in two years. our first witness is joe jordan, welcome from o.b.m. he was confirmed as administrator for federal procurement policy in may of 2012. he's responsible for developing and implementing government contracting policies and is the senior leader and advisor to the o.b.m. director. he will speak on the role and security clearance process. thank you for your testimony and service. next witness is elaine kaplan,

the acting director of the office of personnel management. a position she has held since april of 2013. she's been confirmed for a new job, is that true? you want to tell us what it is? >> yes. i have been confirmed to be a judge on the united states court of federal claims. >> did any of us vote for you? >> some of you did. the others were clearly a miss take. -- mistake. >> congratulations. thank you for doing double duty here in the last six months in taking this on. to our colleagues who were good enough to find a way supporting a confirmed director, i thank you for your support. as the acting director, miss kaplan oversees the office of federal investigative services. the office responsible for ensuring that the federal government has a work force that is worthy of public trust by investigating and reviewing applications for security clearances. and by performing background

checks to determine whether a person is suitable for employment by the federal government or federal contractor. acting director kaplan, thank you for your testimony, for your leadership and good luck in what lies ahead. letti, brianess is preoletti a special security director at the office of director of national intelligence. he's held this position since may of 2013 after serving at the central intelligence agency from 1981 to 2013. as the assistant director of special security director, he is responsible for leading the oversight and reform efforts of security clearance process on behalf of the director of national intelligence, we thank you for that. we thank you for your -- all your service to our country and joining us today.

next witness is steven lewis, director -- deputy director for policy for industrial and physical security policy and office of the undersecretary for intelligence at the department of defense. the undersecretary of defense for intelligence is responsible for dodd's policies, programs, and -- d.o.d.'s polcy, programs, and guidance and related personnel and security. mr. lewis, thank you for your testimony today. we are clited to note, i mentioned doctor in the audience today, his daughter, sarah, who for a number of years was my scheduler. she told me where to go every day with relish. i usually went there. ot always on time. as the assistant director for special security director, mr. prioletti is responsible for leading the oversight and security clearance process on behalf of the director of national intelligence.

wanted to say, steve, i understand the secretary for the -- secretary of defense for intelligence is responsible for polcy, programs, and guidance relating to other things personnel and security. you have that whole broad realm? >> yes, we do. >> how long have you been doing this? >> six years now. >> all right. thank you. final witness is brenda fairly, director of defense capabilities and management at the government accountability office. in april of 2007, ms. fir rell was appointed to serve as director of capabilities and management team where she's responsible for military and civilian personnel issues. including personnel security clearance process issues. miss farrell has offered several reports critiquing government efforts to reform the security process. we thank you for your testimony today.

turning it over to mr. jordan for his remarks, we had a short scrum before the hearing began in the anti-room -- anteroom. what i said to our witnesses, colleagues, and guests, i said, part of what we are trying to do here is figure out what is the role of government. what is the role of government. i quoted abraham lincoln who used to say, to do for the people what they cannot do for themselves. david osborne more recently said in a book called "reinventing government" the role of the government is to steer the boat not row the boat. what kind of steering do we need to do. who should be doing the rogue and how do we make sure we are steering better, the federal government or private sector are doing a much better job. mr. jordan. five minutes to give us your statement. you go beyond that we'll rein

you in. stick to that and we'll be fine. thanks so much. >> thank you. chairman carper, ranking member coburn, and members of the committee. i appreciate the opportunity to appear before you today to discuss the government's practices and procedures regarding security clearances, facility access, and suitability demplingses. before i begin my testimony, i wanted to first say a few words about the tranlic events that occurred at the washington he navy yard on september 16. on behalf of the administration and my colleagues here today, i want to extend our deepest condolences to all those affected by this tragedy. nothing can bring back the loved one that is died that day, it's clear we need to do a better job of securing our military if a sainlts deciding who gets access to them. i and my fellow witnesses take this responsibility incredibly seriously and are deeply and personally committed to this effort. i also wanted to note to assist with the addressing -- >> mr. jordan, sorry to interrupt. i said five minutes. you have seven minutes. take seven. >> thank you, mr. chairman. >> you can take less.

try not to take more. >> i shall. i also wanted to note that to assist with the addressing full spectrum of needs of all individuals aaffected by the tradgedirks we established the washington navy yard recovery task force led by the assistant secretary of the navy for the environment. as government officials our highest duty is to protect the national security, including the confidentiality of confidential information. we have a critically important obligation to protect individuals performing work on behalf of federal agencies from workplace violence. in recent years with congress' help, we have taken a number of important actions to strengthen protections of both nurt information and the physical security of federal facilities such as improving the effectiveness and efficiency of background investigations, and strengthening the processes by which agencies make national security and suitability determinations. we must ensure those processes and the processes for granting or revoking access to facilities

and information systems fully mitigate risks. we have a multisector work force, comprised of military, civilian, and contractor personnel. we work to ensure robust vetting policies and policies are applied to all individuals with access to federal facilities, networks, or classified information in a consistent manner. this approach reflects two important principles, first, the need to protect our national security is no less critical when the work is performed by contractors than when it is performed by federal employees. second, the men and women who make up the contractor work force are no less patriotic than their government counterparts, and in fact many have had meaningful careers as federal employees or in the armed forces. while we have made significant progress in the area of suitability security clearance and credentially process reform, we need to do more. in 2004, congress passed the intelligence reform and terrorism prevention act which required all agencies to complete 90% of their security clearances in an average of 60 days. as a result of actions the executive branch has taken to

meet the goals and objectives of that act, by december, 2009, compliance was achieved. we have consistently met these goals every quarter since while maintaining the standards expected of the clearance process and the backlog of initial investigations has been eliminated. executive branch reform efforts have also extended beyond just timeliness goals. in order to align suitability and practice answer establish enterprise information technology standards to improve efficiency and reciprocity. we established the suitability and security clearance performance accountability council. chaired by o.m.b.'s deputy director for management. as a marker of the progress made, in 2011 g.a.o. removed d.o.d.'s personnel security clearance program from its high-risk list. we recognize the serious nature of recent events and will continue to intensify our efforts to strengthen and improve our policies and processes. to that end, the president directed o.b.m. to lead a

120-day interagency review on the suitability and security processes. for suitability, the review will see whether the processes in place adequately identify the applicants baitsed upon their character on past conduct may be dangerous to the workplace. the focus on national security risk will center on determining eligibility and granting access that could lead to loss of classified information and damage to national security. additionally, we will evaluate the means to collect, share, process, store information that supports these decisions while emphasizes transtransactions among and equity shared across agencies. as part of that efforts we'll consider opportunities to improve the applications of these standards and procedures to contracting which may include improved information sharing between agencies suspending and debarring officials, and the offices responsible for making determinations for fitness and security clearances. our first interagency meeting is scheduled for next week and we'll serve to launch our

process. additional meetings will occur over the coming weeks and we fully anticipate this review to be completed within the 120-daytime frame. once again, thank you for the opportunity to testify. as i noted in the beginning of my testimony, there is nothing more important than the two goals of protecting our people and protecting our sensitive information. we have steadfastly worked in a collaborative manner to improve our processes and procedures to ensure the safety of both. as recent tragic events have highlighted, however, we must maintain a strong focus on continuous improvements and we'll heed the president's call to conduct a comprehensive review and address any potential gaps in the most effective and quickest manner possible. we look forward to working with this committee and congress as we undertake this important work. >> thank you so much. ms. kaplan. >> chairman carper, ranking member coburn, and members of the committee, thank you for your asking me to be here today. the events that occurred last month at the navy yard were horrifying and heartbreaking. 12 civilian employees, among them both civil servants and members of our contract work

force, were ruthlessly gunned down. all of these individuals were doing what millions of their colleagues in the federal work force across the country do every day, coming to work to serve the american people, put food on their tables, and provide for their families. as the acting director of the office of personnel management, and the federal government's chief personnel officer, i share your commitment and that of our president to identifying and addressing the root causes of this terrible tradgedy. i also share your commitment to that of my colleagues seated at this table to perfecting to the greatest extent humanly possible our processes and procedures for determining who shall be allowed access to our nation's secrets, granted the privilege of serving in a position of public trust, or given permission to enter federal buildings and facilities like the navy yard. to those ends, since 2008, o.p.m., d.o.d., and others have worked together on reform effort to ensure there is an efficient,

aligned, high quality, and cost-effective system for conducting background investigations and making determinations regarding security clearances, employee suitability, and contractor fitness. we have made great progress as is reflected in the written testimony of the witnesses at this table. so as mr. jordan just mentioned, we eliminated the backlog of security clearance investigations that if and of themselves posed a risk to our national security. we have dramatically reduced the time it takes to complete such investigations to meet the deadlines that congress has established. we have imposed reciprocity requirements for greater efficiency, issued new investigative standards we are now preparing to implement. we have enhanced and professionalized the training of investigators and adjudicators, and we have worked together to implement g.a.o.'s very helpful recommendations by designing and imminently deploying a new set of agreed upon metrics that we can use to measure and drive up the quality of our investigative products. at o.p.m. we have implemented

our own new quality control measures and have an aggressive program to hold investigators to the highest standards of integrity and to ensure that their work product is something on which federal agencies should be able to rely with confidence. we have overhauled and reviewed our processes for the work of our investigators, increased our oversight staff, and retooling our audit process. we do not tolerate fraud or falsification, we actively look for it, in those few cases where we find it, we take immediate administrative action and then work as we have with our i.g. and department of justice to pursue criminal sanctions against those who betray the trust that has been bestowed upon them. of course much more remains to be done, even the highest quality and most comprehensive background investigation is just a snapshot in time. the evolution of the security clearance process has to include the ability to obtain and easily share relevant information on a more frequent or real time

basis. we also need to improve our capacity to receive information and machinery to perform and share information across the federal government and with state and local law enforcement. at the president's direction and under the leadership of the director of o.m.b., o.p.m. has been and will continue to work with its cleat on the performance accountability council to conduct the 120-day review of the oversight and implementation of nurt, credentially and fitness standards for individuals working at federal if a sifments our review will focus on steps that can be taken to strengthen these processes and the implementation of solutions. the tragic events at the navy yard as well as recent high profile security breaches highlight the need to be ever vigilant it in ensuring individuals entrusted with classified information and more generally individuals with physical access to federal facilities and information do not present a risk of farm to the national security or to the safety of our employees in our

workplaces. and to the end of improving our processes and procedures, i thank you for the opportunity to testify regarding all of these issues. i will be happy to answer any questions that you might have. thank you. >> miss cap -- ms. kaplan thank you for that and those encouraging wrords. mr. prioletti proceeds. thanks for joining u >> good morning chairman carper, ranking member coburn, and distinguished members of the subcommittee. thank you for the invitation to provide information on the government's practices and procedures regarding security clearances and background investigations. the role of the director of national intelligence, known as the d.n.i., as a secured executive agent, his authorities and responsibilities for oversight of the security clearance process across the government and areas in need of attention in the current process and initiatives under way to address those areas. before i follow, i would like to make the comment that we also add our deepens condolences to the family members for their

loss, and our commitment to work towards continuing to improve the security processes and access capabilities of the united states government. pursuant to executive order 13467, the d.n.i., is responsible for the development and oversight of effective, efficient, uniform policies and procedures governing the timely conduct of investigations and adjudications for eligible for access to classified information or eligibility to hold the sensitive position. the d.n.i. also serves as the final authority to designate agencies to conduct background investigations and determine eligibility for access to classified information and ensures reciprocal recognition of adjudication determinations among those agencies. i would like to focus on two essential components of the security clearance process. the background investigation and adjudication determination.

the 1997 federal investigative standards, as amended in 2004, are the current standards used to conduct background checks or investigations. these checks are required prior to making a determination for eligibility for access to classified information or eligibility to occupy a sensitive position. the scope of the background investigation is dependent upon the level of the security clearance required, regardless of the type of clearance involved, identified issues must be fully investigated and resolved prior to any adjudication. an adjucative determination is based upon guidelines issued by the white house in 2005. clearance decisions are made utilizing the whole person concept which is a careful weighing of available, reliable information about the person, both past and present, favorable and unfavorable. recently, two highly publicized and critical events involving individuals with clearances highlighted areas in need of

attention in the current security clearance process. the odni in collaboration with our colleagues here, o.m.b., o. p.m., d.o.d., and other federal partners has been leading security clearance reform now for several years. all those he these efforts are still a work in progress, when mature, they will mitigate many of these gaps and enhance the nation's security posture. under current policies and practices, an individual's continued eligibility for access to classified information relies heavily on a periodic reinvestigation. essentially a background investigation and adjudication conducted every five years for a top secret clearance, and every 10 years for a secret clearance. the time interval between periodic reinvestigations leaves the u.s. government uninformed as to behavior that potentially poses a security risk or counterintelligence risk. continuous evaluation, known as c.e., is a tool that will assist in closing this information gap.

c.e. allows for ongoing reviews of an individual with access to classified information, or in a sensitive position, to ensure that that individual continues to meet the requirements for eligibility. c.e., as envisioned in the reformed security clearance process includes automated record checks of commercial database, government databases, and other lawfully available information. a number of pilot studies have been initiated to assess the feasibility of automated record checks and utilityity of publicly a available electronic information. more research is required at this time to assess resource impacts and determine the most effective practices. a robust c.e. capability will also support and inform the insider threat programs. we must build an enterprisewide c.e. program that will promote the sharing of trustworthiness, emingibility, and risk data within and across government agencies to ensure that information is readily available

for analysis and action. another area in need of attention is consistency and the quality of investigation and adjudications. the revised investigative standards when implemented will provide clear guidance on issue identification and resolution, in addition the odni, o.p.m., and d.o.d. are co-chairing a working group that is developing common standards and metrics to evaluate background investigations for quality and comprehensiveness. furthermore, the odni has hosted a working group to refine the adjudicative guidelines, and recommendations regarding these guidelines are in the policy development phase. another initiative supporting a moreau bust security clearance process was the development of the national training standards which were approved in august 12 by d.n.i. and o.p.m. for implementation in 2014. they create uniform training criteria for background investigation -- excuse me,

background investigators, national security adjudicators, and suitability adjudicators. additionally, o.m.p., odni, and o.p.m. are working to revise standard form 86, the questionnaire for nurt positions to include the collection of accurate information pertinent to today's concerns. as a final note for the president's directive, o.m.b. is conducting a review of the security and suitability process. as such, the d.n.i., opm, and d.o.d. will review the policies, processes, and procedures related to the initiation, investigation, and adjudication of background investigations for personnel security, suitability for employment, and fitness to perform on a contract. in closing, i want to emphasize the d.n.i.'s resolve to lead the initiatives discussed today and continue to collaborative efforts established with d.o.d., o.p.m., and our federal partners.

we thank you for the opportunity to update the committee at this time and look forward to working with you on these matters. >> thank you for that update. i look forward to hearing from mr. lewis. >> good morning. chairman carper, ranking member coburn, and distinguished members of the committee, i appreciate the opportunity to appear before you today to address the practices and procedures of the department of defense regarding security clearances, facility access, and background investigations. the undersecretary of defense for intelligence, dr. michael vickers, is the principal staff assistant to the secretary and deputy secretary for security matters. in this capacity dr. vickers exercises his authority as the senior official for d.o.d.'s personal security program and has primary responsibility for providing and improving guidance, oversight, and development for policy and procedures governing civilian,

military, and industrial-based personal security programs within the d.o.d. in order to address the department's personnel security policies, i believe it's important to first identify the national level policy framework. executive order 13467 designates the director of national intelligence as the security executive agent with the responsibility to develop uniform policies and procedures to ensure effective colleagues of investigations and determinations of eligibility for access to classified information or to hold national security positions. this includes reciprocal acceptance of those determinations. in addition, the executive order designates the director of the office of personnel management as the suitability executive agent that's responsible for developing and implementing uniform and consistent policies and procedures regarding investigations and adjudications relating to determinations of

suitability and eligibility for logical and physical access to federal government installations and systems. finally, the executive order creates a performance accountability council chaired by the deputy director for management at o.m.b. and including the d.n.i. and director of o.p.m. with responsibility to align suitability security and as appropriate contractor fitness investigative and adjudicative processes. with regard to the oversight roles within the d.o.d., the heads of d.o.d. components are responsible for establishing and overseeing implementation of procedures to ensure prompt reporting of signature derogatory information, unfavorable administrative actions, and adverse actions related to personnel. this needs to be provided to appropriate officials within their component and as

applicable to the d.o.d. consolidated adjudication facility. this responsibility applies to military service members, d.o.d.'s civilians and contractor personnel. under the national industrial security program, cleared contractors are required to report adverse information coming to their attention regarding their cleared employees. in addition, defense security service is responsible for conducting oversight of companies cleared to perform on classified contracts for d.o.d. and 26 other federal departments and agencies that use d.o.d. industrial security services. the department has worked very hard to create improvements that have produced greater efficiencies and effectiveness in the phases of initiating and adjudicating background investigations. as a result, in 2011 the government accountability office removed d.o.d.'s personal security clearance program from the high-risk list.

we have used multiple initiatives to review and confirm the quality of the investigative products received, the quality of our adjudications, and the accuracy and completeness of the documentation of the adjucative rationale, the basis for these determinations. this helps to support our oversight as well as reciprocity. in addition, we have implemented a certification process for d.o.d. personal security adjudicators, and over 90% of these are certified to ridged standards and ultimately it's a condition of employment that each adjudicator will complete this certification process. in may of 2012, the deputy secretary of defense directed the consolidation of all adjucative functions and resources except for the d.o.d. intelligence agencies at fort meade, maryland, under the

direction, command, and control of the director of administration and management. this decision was made in order to maximize the efficiencies, realized by the co-location of the central adjudication acilities under the 2005 round of realignment and closure, and effective, october 1, the d.o.d. assumed responsibility to adjudicate background investigations which are the basis for the issuance of common access cards used for physical access to d.o.d. installations and to access d.o.d. information systems. thank you for your time. i look forward to answering your questions. >> we thank you very much. great to see you. welcome. >> thank you very much. chairman carper, ranking member coburn, members of the committee, thank you so much for this opportunity to be here today to discuss the federal government's personnel security clearance process. let me briefly summarize my

written statement for the record and to some extent what has already been conveyed here today. personnel security clearances allow for access to classified information on a need to know basis. recent events such as the unauthorized disclosure of classified information has shown that there is much work to be done by federal signature's as you noted, mr. chairman, to help ensure the process functions effectively and efficiently so that only trustworthy individuals hold security clearances. over the years g.a.o. has conducted a body of work on personnel security clearance issues that gives us a unique historical perspective. my remarks today are based on our reports issued from 2008 through 2013 on d.o.d.'s personnel security clearance program and governmentwide reform efforts. my main message today is that quality and importantly quality metrics needs to be built into

every step of the clearance process. my written statement is divided into two parts. the first addresses the overall security clearance process. multiple executive branch agencies are responsible for different steps of the multiphased personnel security clearance process that includes, one, determination of whether a position requires a clearance. two, application submission. three, investigation. four, adjudication. and five, possible appeal if a clearance is denied or revoked. for example, in 2008 executive order 13467 designated the d.n.i. as the security executive agent. as such the d.n.i. is responsible for developing policies and procedures to help ensure the effective, efficient, and timely completion of background investigations and adjudications relating to determinations of eligibility for access to classified

information. in turn, executive branch agencies such as d.o.d. that accounts for the vast majority of personnel security clearances domplee which of their positions, military, civilian, or contractors, require access to classified information and therefore which employees must apply for and undergo a clearance investigation. investigators often contractors for o.p.m. conduct these investigations for most of the government. o.p.m. provides the resulting investigative reports to the requesting agency for their internal adjudicators to make the decision as to whether or not the person is eligible to hold a clearance. in 2012, we reported that there were issues with the first step of the process, determining which positions require access to classified information. we reported that the d.n.i. security executive agency had not provided agencies clearly

defined policy and procedures to consistently determine if a position requires a clearance. . and validate existing perfectly civilian positions. we recommended that the d.n.i. in coordination with o.p.m. issue such guidance and odni concurred with our recommendations. i am pleased to say that the dni and opm have actions under way address our recommendations the second part of my statement addresses the extents to which executive branch agencies have metrics to help determine the quality of the security clearance process. for more than a decade g.a.o. has emphasized the need to built and monitor quality throughout this personnel security clearance process to promote oversight and positive outcomes such as the likelihood that individuals who are security risk will be scrutinized more

closely. g.a.o. reported in in 2009, request respect to clearances adjudicated in for d.o.d. documentation was incomplete for most o.p.m. investigations. the we were independently stimated that 87% of 3,500 investigative reports that d.o.d. adjudicators used to make clearance eligibility decisions were missing some required information. such as verification of all of the applicants' employment. we also estimated that about 12% of the 3,3500 reports did not contain the required subject interview. we recommended that o.p.m. measure the frequency which the investigative report met federal investigative standards in order to improve the quality of investigative documentation. as of august, 2013, o.p.m. had

not implemented this recommendation. finally, i would finally, i'd like to note that we placed d.o.d. on the high-risk list in 2005 because of the delays and processing clearances and we continued that designation until 2011 when we removed d.o.d.'s program in large part due to the significant progress and reducing the amount of time to process the clearance and steps d.o.d. had taken to help ensure the quality of the adjudication process. at that time we noted executive branch efforts under way to develop and implement met ricks o complete mop's investigations. -- o.p.m.'s efforts. the effort that was made with respect to reducing the amount of time to processing clearances would not have been made possible without the committed and sustained oversight by congress and the

executive branch agency leadership. further actions are needed now to oversee quality at every step of the process, including background investigations. mr. chairman, this concludes my remarks. i'll be pleased to take questions when you're ready. >> thank you for your testify and thanks for the good work in this area. some after i ask questions, senator tester. landrieu, ator senator portman. some of those folks have slipped out but will come back. i just want to start with you, if i could. we appreciate >> of the things that we heard from each of our witnesses, the changes that we made, the reforms being adopted or have been adopted, what should we feel especially good about? >> i think the collaboration

between d.n.i. and o.p.m. and the other agencies has improved over the years. i think when we started this work back in 2005 looking at timeliness issues, there was not a lot of collaboration and communication going on. i think that executive order 13467 that established the performance accountability council and pointed the deputy director for management at o.m.b. as the chair helped provide a governance structure for that collaboration to continue. the most notable improvement that we have seen is with the processing of initial personnel security clearances at the top secret level. there are no metrics for the processing times for other aspects such as the periodic reinvestigations. again our concern has been and we have stated this offer the years, since 2005, that we do not want to see the processing

of the clearances at the expense of the quality of the investigations. >> of the work that's in progress, some of which we heard discussed this day, would you just talk with us for a little bit about what are some of the most important aspects of that work that are in progress, and with a thought of how we in the legislative branch can be helpful, most helpful, in expediting that work that's in progress? >> yes, i think the work that the agencies are doing to revisit the investigative standards is very important. this gets to the heart of what we are saying about quality. by quality we mean for the background investigations in particular are we obtaining the right information, the best available information from the right sources. is it complete? is it reliable? i think the revisitting the federal investigative standards and seeing if there are new techniques or new information that needs to be included, and

perhaps some needs to be excluded, since these standards go back decades, but that is, i think, a very good focus, first determine if you're collecting the information that you need for the background investigation, and then make sure that you have metrics for the completeness of that information. >> second half of my question is, advice you might have for oversight committee to try to make sure that the work that's in progress, the most important work in progress is actually accomplished. your advice to us. >> i think part of the reason why we saw progress with the timeliness issue was due to congressional oversight as i noted in the opening statement. also at that time the intelligence reform and terrorism act of 2004 required an annual report to congress for interim steps to meet the final goal of processing clearances within a 60-day period. the good thing was it wasn't something to happen overnight.

again there were interim steps for the executive branch to take to meet that 60-day goal. that annual report reflected information on timeliness to help make sure they were meeting those interim goals and if they weren't meeting them, what could they do to make a course correction in order to continue that significant progress. there's a sunset clause on that annual reporting, and we have not had the same type of oversight for the remainder of the reform efforts as we did for timeliness. i think this may be an area either through reporting or through continued congressional hearing with interim steps to meet the goals. one of the areas we mentioned on metrics, may 2010, several of the executive branch leaders signed a memo to some congressional leaders noting these are the metrics that we have under development that we re planning to put in place,

and this covered not only timeliness but the investigations, adjudications, reciprocity. a lot of these metrics dealt with quality of the process. but those metrics as i noted with the exception of timeliness, we have not seen those be fully developed, and this is something that we'd like to understand why not, and if not, what the metrics and what the plan was in may, 2010, what is the plan. >> i want to drill down a little t if i could on the issue of quality control. yesterday the department of justice announced, i believe, it's joining a lawsuit brought against the united states investigations services, commonly known as usis, a company that performs about ham half of all investigations contracted out by the office of pesh personnel management case. allege that you sent back to o.p.m. investigation reports

that were not complete in order to maximize profits -- practices, i previously referred to as dumping. miss ms. kaplan, this lawsuit comes on top of the investigation raised about the investigations and edward snowden, are we at a crisis point with the credibility and integrity of the security clearance process? what should give us any faith in the current system? >> i appreciate the question, and i certainly understand it based on the reports that have appeared. as you mentioned, senator, on tuesday afternoon a full claims act complaint was unsealed, and it contains very serious allegations of contract fraud against usis, arising out of conduct that took place in 2010 and 2011. we have been aware of these allegations and since the complaint was filed in july of 2011 we have been working closely with d.o.j. and i.g. to implement changes that would address the contract fraud and

ensure it would not continue. let me explain to you what we understand the allegations to be. we understand the allegations to be that the contractors have an obligation under the contract to conduct their own quality reviews of investigations. once they finish their quality reviews, they send the product to o.p.m. and we conduct our own quality reviews of the investigation. what the allegation is here is that in order to move cases more quickly, usis did not conduct its own quality reviews. and that's a real problem, obviously. if the allegations are substaniated because it's contract fraud because they were certifying that they were completing the quality reviews. it's also a real problem because we rely on their quality reviews in order for us to be able to move the investigations a lot more quickly. we'd like them to catch issues and fix them before they send the reports on to us. i will say, maybe it's cold comfort, but the case that is

were, to use the phrase, dumped, were cases that also were subject to o.p.m. quality review. it is not that the cases weren't ever reviewed before they were passed on to the agency. that being said, we have done a number of things as soon as we became aware of what -- of the allegations. with respect to o.p.m., we significantly increase the number of government personnel performing contractor oversight by increasing the number of people, the f.t.e. levels, and realigning our internal st. we have increased on-site inspections with contract review, including a comparison of their process to the requirements of the contract. we have increased the frequency of the audits of cases closed by the contractor. we have developed a new report to detect instances where quality reviews may not have been performed, according to the terms of the contract, as is alleged to have occurred here. we have sort of conducted inspections on the average number of reports being reviewed

and released by the contractors review staff for trend analysis so we can find anomalies. we have removed former usis officials involved or allegedly involved with the o.p.m. contract, and we are currently in the process of recompeting our support services contract, which is also held by usis, to preclue a concern there might be clution between the support staff and field investigators. that was a recommendation of our inspector general. lots of things have occurred at usis since this -- >> my time has expired. i want to be respectful of my colleague. sum it up in one more sentence. this is good response. >> a loft changes have been made at usis. there's a new c.e.o. there. there's a chief compliance officer. there are new integrity standards. internal audit committee. there have been a loft changes made since the events that were revealed in the complaint. that has given us some level of comfort and confidence that we can rely on these products.

rely, trust but verify. >> trust but verify. well said. dr. coburn, thank you. >> thank you. let me -- thank you for your testimony. i kind of see this as a multitude of problems. i mentioned in my opening statements, we overclassify, which is a problem for the american people because that means it's not transparent. and sitting on the intelligence committee i get to see what is secret and top secret. highly classified and compartmentalized. one of the other things i see is in five different instances we have people who are doing in the investigations who are also doing the adjudication. so we have an absolute conflict of interest in terms of separating of authorities and responsibilities in five areas and the clearance process, five separate areas, where we have the same person adjudicating or the same firm, adjudicating what was cleared. what was investigated.

third, as we have noted, we have three different instances in our very remote history where we have obviously failed in terms of our clearances, whether it's bradley manning or what happened here at the navy yard, or what appened at or what happened at n.s.a. we have a failure. and the other thing we have is now we know that we have 8,400 people with clearances that don't follow the law paying their taxes and half of them have a top secret clearance. you know, the american people ought to be asking, what in the world is going on. and so my question is, we've now seen outlined who's ultimately responsible for it. that's d.n.i., correct? >> yes, sir. >> and we have the defense department that's making improvements but still has a way to go, and we have failure of contractors and not doing

allegedly not doing what they're supposed to do. there's also another i.g. investigation going on along with that. but what's the answer? one of the answers has to be doing the job that we do better, one. number two, the other has to be using data that is available. you know, the form -- where is that form? this form for $20 you can get 90% of the information on the internet. we pay $2,400 for top secret clearance, is that right? that's about what we pay. it's about $2,400. >> tore stop secret, it's a little more than that, it's $4,000. >> for a secret, what do we pay? >> about $262. >> and for $20 you can find out 90% of this stuff online right now. and so the question is maybe we

need to step back and say, first of all, we got way too much stuff classified. we have way too many people that have to have clearance. number two, how we're doing it is not utilizing data today that's readily available. number three, we had a response from director clapper that they're going to start coordinating with the i.r.s. most people would say, that's kind of a no-brainer. that would be one of the things you would want to check. it's in the form, have you paid your taxes, but it looks to me nobody ever cross-referenced that with the i.r.s. nobody ever checked to see if that data is accurate and all that is a computer check. my final point is, creating the expectations that your clearance is tentative on the basis of you passing some type of renewal and not know when that's going to be, the c.i.a. used to have random polygraph

tests. they don't even have random polygraph tests. you're noticed. i can pass any polygraph test with two drugs in me and you won't ever know it and so the fact is we need to create an environment where, number one, we lessen the number of people that need a clearance. we do a whole lot better of clearing. and then we need to create the expectation that you will be randomly checked to see if in fact you still deserve the clearance. and the details are difficult. i'm not saying it's not difficult. but how we do it and how much it costs and holding contractors accountable for doing the very job we're paying them to do doesn't seem to be happening. my question, i'd like a response from you all, how do you solve this? you laid out where you are. how do you solve it? we have all these areas. the form, this form, three

pages of instructions, seven pages where you live, five pages of name, 17 pages of employment, 29 pageses on relaugsship. two pages on emotional health. seven pages on police records. 1135eu7b8gs on drugs and alcohol. five pages on association and three signature pages. i know you're reforming the form. but the point is is what we want to do is go for the gold. and so not all of this -- first of all, is checked from a quality assurance check. and number three -- number two would be is can we create a process that gets to the gold and not rely on a form as much as we can data that's already out there that the government already holds. are you all amazed that 8,400 people in this country have a tax debt that makes them

vulnerable to top secret data and they have clearances today? does that bother anybody here? that puts us at risk. so my question is, whoever wants to answer my broad commentary or at least educate me in a different direction, i'd love to have it. >> if i could just make one point and i'm sure my colleagues will jump in. you had noted -- and i think this is a misimpression that a lot of folks have that the contractors are doing both the investigations and the adjudications and that would be a really bad system. but in fact, the adjudication is not done by the contractors. it's done by the agency that's granting the clearance. >> [inaudible] >> no. those are -- that's an inherently governmental function. it's not something we would entrust to a contractor. i believe i'm right about that. >> [inaudible]

>> you're using contractors for this clearance process. to me it would seem the clearance process in and of itself is a government function, not just the adjudication but the -- >> i'll turn that over to mr. jordan. >> senator, the collection of information, the analysis is not in inherently governmental function as director kaplan said. the decision, the adjudication is an inherently government function. that should only be performed by government employees. but the collection of information is not inherently governmental. to your earlier question, this goes to the very nature of what we're doing in our coordinated interagency review, how do we get the right data in the right people's hands at the right time to make the right decision? so continuous -- automated record checks to the extent we can build out our capabilities there, very important. building both efficiency and effectiveness, furthering both of those in the system, and then making sure we're constantly looking at all of

the provide sessees in the end-to-end spectrum from the initiation, to the investigation and the adjudication and on an ongoing basis so we address any gaps, any weaknesses as quickly as possible. we have 45 million people with security clearances. you noted some issues but they are few. we need to do everything we can to make surely we don't have sangle one. >> well, i've not heard anybody say anything. i think senator tester and i agree, we classify way too much stuff. do y'all disagree with that? and what's the answer to that? because once you put -- create something as classified, the only people that can work on it are people that have a clearance for that classification or above. what's the comment? what's g.a.o.'s response on that? >> we have -- that's a separate issue from the people part.

but we have done work in the past looking at the potential overclassification of materials and we do have work just started looking again at the potential overclassification. that though does relate to the first step of the personnel security clearance process. determining if a position needs to have access to classified information. and that's where those types of tradeoffs could be made. there's a misperception often that security clearance follows the person. it doesn't. it follows the position so as we've noted, there has been a lack of guidance in that area. we did work at d.o.d. and d.h.s., components within both of those departments. we found some components took initiative to revalidate existing positions and some did it one time and had no plans to do it again. some never did it.

so from a personnel security clearance process view, that very first step is very important to make sure that the position does require access to classified information. that's where those types of questions could be asked. what is that classified information? if you overclassify, then you overclassify positions, then it starts to snowball affect of having five million people -- snowball effect of having five million people have classified clearance. >> just quick note. i did a little bit of math. i hope i did this right. if there are 8,400 people out of the 4.9 million people that ave clearances, that's about .16% of people that owe government money. hopefully they are on a repayment schedule. we don't know. hopefully they are.

40% of those ron repayment schedules. that means about .1% owed government money, they are not on repayment schedule. that's not good. compared to what? compared to the 99.9% that have a clearance who don't owe the federal government anything on taxes, so -- >> would you yield for a minute? >> sure. >> it raises the question, it's not about a percentage. if you're not following the law in terms of paying your faxes, why should you have a security clearance at all? whether you got a payment plan or not? you have not complied that we expect every other american citizen to comply with and you have a security clearance? to me it begs the question, you're not up to date on your taxes, you're no longer have a clearance, period. i mean, it's creating the right expectations is my thought. >> go ahead. the other thing i say, i spent 3 years of my life as active

in reserve duty flight naval officer. if i said people say this is people that is overclassified, this is an age old problem. we have to look at this again and again and say do we really need to classify, so that's a ask. uestion to senator ma cass kill and others, -- mccaskill and others, we recognize. >> i think the bigger issue of taxes paid is taxes paid is pretty basic. what else is going on out there that's slipping through the cracks on security clearance because taxes, that's right in front of our face and we're missing that. mr. chairman, just to follow-up with senator coburn's comments. i think we have pushed through this committee the revolving dollars to be made for more

transparency, more audit, more accountability. the house committee passed that. i would encourage you to do what you can do with your counterpart over in the house to make sure the full house takes that up because it's critically important. there are two pieces of that bill that senator portman, senator mccaskill, senator johnson and others are part of, plus some others, that deals with accountability and it deals with the number of clearances that are out there. i think we should push to try. negotiations are going on, but you have to set a level of expectation. i think that's what that does in part. i want to follow up a little bit on what chairman carper alked with you, elaine, on the d.o.j. suit that was filed in 011, july, and we were told by o.p.m. that there wasn't problem with uses. and there's a suit out there

that doesn't look very good to me, and now we're finding out that o.p.m. is probably going to get onboard or maybe going to get onboard or is getting onboard. what's going on? it looks to me quite frankly that there's a real disconnect here between what the contractors are doing and what the expectations what the contractors to do and people are dying because of it. we're losing critical information because of it. i mean, the list goes on and on. o what -- what's going on? >> thanks for the question. i am not aware of anyone at o.p.m. saying there's no problem with uses. i do know that because of the fact that this complaint was under seal we were unable to talk about the complaint. and now we can talk about the complaint, which i think is a good thing. and i think what we have tried to do, as i was explaining to

senator carper before was -- and this started before the complaint became public and it's been over the last several years is to address and to rectify the problems that are revealed in these allegations in this complaint which was under seal. as i mentioned, we did many things at o.p.m. to prevent this from happening again. this is contract fraud. a failure to do quality reviews that they were obligated to do under the contract and there have been many, many changes made at uses as well. many changes that involving the whole new -- new staff at the top. compliance office, internal audit, all sorts ever things that have given -- >> when were those changes made? >> those changes have been made over the last two years. since the allegations in the complaint, and we've been working with our i.g. on it and with the justice department. we feel the allegations are certainly very disturbing, and what we've tried to do is

address the underlying concerns without speaking publicly about them. >> and so you guys -- and i'm not an attorney, but they have been sealed. you've known what's in the charges, you just can't talk about it publicly, is that correct? >> i can tell you right now -- in fact, you can go online probably -- >> i don't care about now. i want to know about july, 2011, were you guys aware of what the charges were? >> we knew what the allegations were in the complaint. however, working with the justice department and our i.g., we were, you know, advised, of course, not to discuss it because that was a matter -- >> that's fine. i guess the question, 60% of the background checks, right? >> 50%. >> three companies that do the contracting, so they're doing the lion's share of it? >> yes. >> was there any oversight, additional oversight given as of july 1 on the work that they were doing, how often was it done and by the way, are those

kind of metrics used on all of them? because quite frankly, when money is involved, there are some folks that don't give a damn about the product and they just want to make the money. >> yeah, i mean, that's a good question. i mean, what we've done -- and it's not just oversight of uses because we have. other contractors and we have federal employees quite frankly that do the work too. they need to be watched. >> what determines what background checks go to uses -- those guys do some things particularly well and other things not so well or do you dole them out like a deck of cards or what? >> i don't think it's like a deck of cards. i actually don't know what -- i will get an answer to you on that question. i suspect it's based on the location of the investigation buts not that they dot top secret and -- >> i believe it was you that talked about quality metrics. i might have been brenda too. what determines what background checks you guys look at to see if they're done appropriately? >> we look at all of them. we look at each background investigation. >> so you look at alexis'

background check? > yes, we did. would you like me to talk about it? >> the information is out there. the naval record alone should have brought up some red flags. what you're saying is two folks missed it. uscis missed it and the contractor missed it. >> to be clear, i would have to say that based on our own view, and i believe also odni's review of the investigation, yes, we missed something for sure. but we did what was required. >> multiple somethings. >> o.p.m. -- we need to look at each part of this. we did the investigation in 2007 and it was for secret clearance. there are certain protocols and standards to a secret clearance, not a top secret clearance. we conducted the investigation

that was required by the investigative standards and it was so having gone through quality control, both at uscis and o.p.m., we would have passed that investigation because it complied with investigative standards. now, what we're looking at right now in the context of the review and what we have been looking at is, well, are the standards up to snuff? should we be required to get police reports, for example? should we be required to get mental health information even from someone who has a secret as opposed to top secret clearance? all these things need to be looked at. it was not in our view a case of malfeasance on the part of the contractor. we believe the contractor did what they were supposed to do. >> senator coburn obviously knows what to look at because he had the thick file. if you don't like at police reports and you don't look at what al background and -- do you look at? >> we did look at criminal background. with the secret clearance is there is an f.b.i. check.

we get the f.b.i. database and they reveal arrests. it does not reveal the disposition of cases that are handled at the state and local level. and so the f.b.i. record revealed that mr. alexis had been charged and arrested for what was called malicious mischief and under the existing standards, our job or the job of the contractor, in this case, was to go out and find out what the disposition of that charge was and to find out more information about the charge. now, some have questioned now why o.p.m.'s investigators did not go get a police report. well, the reason that a police report was not obtained was because, you know, there were like 1,700 localities, law enforcement jurisdictions. they all have different rules about what they're going to supply to us. in this case, we had experience with seattle. seattle did not provide police reports and they have their own good reasons, i'm sure. but -- so what we were referred to by seattle was the state database.

the state of washington, their court records and that's where we went. that revealed that mr. alexis was charged with malicious mischief but the charges were not -- >> i appreciate. i'm over time. can i ask you when you guys do an oversight, look at how many do you find a problem with? >> don't have that information but i can get it for you. if there is a problem, we fry to get the contractor to fix the problem, for example, if it's incomplete. and then if there is a problem, if the adjudicator looks at our information, they ask us to do more work. >> this is -- we could be here all day and we probably should be here all day. it's important. thank you. >> thank you. >> thank you, mr. chairman. i want to thank you for holding this very important hearing. let me just follow-up as to what senator tester said. as i understand it, so in the case of mr. alexis, o.p.m. did

actually go to the seattle police department to get the underlying police report? >> no. we did not because we do a lot of these investigations and our understanding was that seattle didn't make that kind of information available. they routinely referred us to the state of washington database and that's where we went. >> so we didn't try to get the underlying police report, we just -- the decision of o.p.m. was that we've dealt with seattle in the past, they won't give us a report? >> well, there are certain -- our tpwhration is to try to find out the disposition or if there have been charges and it was not as though we decided we're not going to make an effort here. we based upon the fact in the past -- and this occurs with other jurisdictions besides seattle. they'll refer us to another database. you know, that is what they did. we did not go in this particular case and say, you'll depart from your policy. in is again something that we need to take a really close look at and we are going to be

looking at as part of the president's review because it is problematic, certainly, there was this information on -- written on a piece of paper somewhere that we didn't have access to. >> yeah. i find it actually incredibly shocking that we wouldn't pursue a police report in any of these arrest situations because the nature of the charge, looking at the underlying police report, having been a prosecutor, can tell us very different information and a prosecutor may not have the elements to make a particular charge and the disposition may tell us nothing. but seeing prior behavior here where aaron alexis, getting a police report would have flagged a very different set of conduct for anyone looking at that. so i believe we do have to change that. and if that comes to understanding with law enforcement across the country, i would be shocked having worked with so many police officers that they wouldn't be willing to have a -- have an

understanding with the federal government on this, given what's at stake for the country. you know, one of the things that concern me also is i heard the discussion between -- between you and mr. tester was this issue of the uscis lawsuit and in 2011, coming before the committee, i wasn't a member of the committee then but the fact that these -- this suit was sealed and as a result of consultation with justice, you didn't feel because of the sealing of the suit that you could share that information. i understand you have to go to justice for advice on these issues, so i'm not being critical of you on this. but what i would be critical of is why wasn't there -- this seems to me a core issue of oversight that the committee would need to know that was the subject of the sealed suit, that now we're seeing obviously ome of the consequences of

part of this being with uscis. with snowden and what we're seeing in other cases. it really troubles me that this would be sealed. was there any discussion about -- with justice of how this is a very important piece of information that the committee really needs to know sdem because i have a problem that justice wouldn't have gone to the court and taken action. having been a prosecutor myself and try to explain there is a separate duty here but the congress needs to be aware of information and needs to protect the country and i think this is part of a bigger issue. i want to get your thoughts on that. did you come subsequently and update us as soon as you could once this thing was unsealed? >> i'm here today. it was just unsealed two days ago. >> ok. fair enough. >> so in other words, it was sealed for two years? >> well -- and you know, i'm not an expert in this. and thank you for calling me judge even though i'm not a judge yet. appreciate it. and i'm not an expert in this.

this is a false claims act case. they have a very special treatment because somebody comes forward as a whistleblower and then the government has -- they keep it under seal because the government wants to decide whether to intervene in the case. >> right. >> and so i think that's the reasoning behind the sealing. >> so understanding that there are obviously different rules regarding false claims -- this is a different issue. we have to get to the bottom of this so this committee isn't waiting a couple years later while this decisionmaking is ongoing in the government when there's a critical issue with a contractor that needs to be addressed. i believe this is an important issue we have to get at. >> if you would yield. i think the real question is, now you have this problem out there, the response i would say is, why weren't we monitoring quality assurance on our contractors to begin with and what have we done since then to monitor quality assurance on the -- the three contractors that are out there doing it? >> that's a fair question.

with respect to what we were doing before, i've been told that actually we were sort of hot on the heels of this around the time that the complaint was filed because we were starting to notice that the quality reviews were being done either too much by one person or too quickly and so we had already made inquiry with uscis but obviously we didn't catch it quickly enough because it occurred. and so what we've done since then is we have focused more, as i said before, on those reports to enable us to find anomalies before -- you know, when the problem is occurring more quickly, and we have beefed up the staff, the federal staff that's working on those matters. and we -- at the same time, uscis has made many, many significant changes in the way that they operate. and so there have been a lot of changes made. with respect to the question about not being able to talk about it, in some ways it was

very frustrating to us as well. >> i can imagine. >> looking at things in the newspaper and unable to, you know -- but i think you'd have to ask the justice department more about it. i think they believe in is required by law. >> thank you. i think obviously that's something we need to work flew so we're not in this situation in the future. i believe ed to ask, -- -- ture letty prioletti, it would provide one of the issues i see in all of this is an issue that we rely -- we rely too much on self-reporting, particularly after we granted a clearance, and our bill is fairly straightforward in that we would -- there would be two random audits conducted. as i understand your testimony, you have talked about this idea in your testimony of --

automated record checks. yet, you say there's more research required. i don't understand how, if it we don't have some random checks and we're relying totally on self-reporting, that frankly people's lives change dramatically and can change in five years' time in a we will have a system that really verifies that people maintain their clearance status, so i wanted to get your knotts on that. >> thank you, senator. what i was referring to is we do automated record checks at this time or electronic record checks. all the agencies do it. for example, when director kaplan referred to the police checks going to the electronic record checks to get in a information, there are ongoing processes such as that going on right now. what i was referring to is with continuous evaluation as an expansion of that into more areas that include internal

government databases as well as external, both government and commercial databases, some of the specificity i can't get into in today's current environment in this proceeding here, but what we're talking about is building the enterprise wide. in other words, have an automated records check ability, continuous evaluation, whether it be several times over a five-year period or whether it be more frequently than that, that can serve both the united states military, serve the intelligence community as well as serving the nontitle 50's. what we have done is we had a c.e. -- continuous evaluation -- working group that was made up of i.c. members, o.m.b. had representation. o.p.m. had representation and d.o.d. had representation. and what we did is we created a concept of operations in a is now ready for testing that takes a level of checks and

balances that are high enough to satisfy the requirements of top secret s.c.i. organizations such as the i.c. but also reasonable for the expectations of an n.t. -- nontitle 50 organization or some fert other organizations. that's a very you touchy balancing act to make sure we have enough checks. but it's an expansion on what's currently done. there are national agency checks, police checks and financial checks for the secret level clearances. some databases, which include classified information and some that do not as well as the commercial databases. the area that i think your most concerned about is the social media or publicly available electronic information and that's where the research is being done, senator. we have to find that balance between the civil liberties and privacies of a u.s. citizen

versus national security interests. that's where we're doing it. i do not have, as a representative of d.n.i., the luxury of going into a social media or publicly available database, pull information out of there and submit it as being the truth. the government has a responsibility and obligation to the citizens to ensure that information is true and accurate before we use it in an adjudicated process. >> i know my time is up. i can tell you obviously when our teenagers go online and get important information on social media and that yet we're not going to use it to find out that someone is involved in something, i think that's -- that's a little hard to believe. we need to take a commonsense approach to this. so my time is up. i also think we need to have random checks on people instead of relying on their own self-reporting. >> senator.

thank you. senator heitkamp. >> thank you. i think this is such a critically important response and quick response to this horrible tragedy and i hope that the family members take some comfort that we, too, share their concerns. i've read this report and i can tell you honestly as somebody who used to do background checks for people involved in gambling in north dakota, if you were going to get paid minimum wage to deal black jack, he would not have passed that background check. he could not have dealt black jack in north dakota. but yet he had a clearance that allowed him to come onto a navy base and do serious, serious human damage. and so it's really frustrating. we're all frustrated here with this process. i completely appreciate your privacy rules, but when you apply for this clearance, you waive your right to privacy. and every parent on this panel who deals with social media knows if you want to know what your kid's doing, go out on social media. you may think that it doesn't

have the veracity of a court record, but i can tell you, somebody who has looked at court records repeatedly, doing background checks, it certainly does. and a picture is worth 1,000 words. it's heartbreaking. so we take this one example. and i always fear that one example does not prove the case, but we've got multiple examples now of where we failed in the clearance system to actually ferret out people who would do damage to co-workers, murder co-workers but also damage to our national security. and so this is a very broad issue and very important issue. i want to talk about self-reporting. and i want to talk about the consequences of not self-reporting. i was quite honestly shocked, because i'm new to this committee and new to looking at government security clearances, the huge number of people in this country who have these clearances. i mean, in is a big group to

manage, right, we'd all agree with that. so obviously random checks are critical and important part of this and you sigh that from the bill in a we introduced. but we need to make the self-reporting more effective as well. so i want to know if all those millions of people who have these clearances how many of them have ever been discharged from the government for failure to self-report? >> we can get you that information. we don't have it with us. >> how -- in your database, how would you know that information? >> well, if, for example, someone fails to report, do you mean on their form, they are deceptive? >> either lying on their application or failure to report after a serious event that occurs after the clearance? >> we will have to get you that information. the latter is certainly grounds for revoking a security clearance and the failing to report or being dishonest when

you feel out your form is something the adjudicator would decide to grant a clearance in the first instance. >> with all due respect, if you're not checking local police records, you have no guarantee that when somebody checks the box and says they've never been arrested that they're telling the truth. >> with respect to that, there's never a guarantee, but we don't just take their word for whether they've been arrested. we do an f.b.i. check. and the f.b.i. database receives reports -- probably more familiar with that than i am, frankly. will spit out if they've been arrested. it requires work on a state-by-state basis or local jurisdiction to find out what the disposition was. remember, we're talking in his case about a secret clearance. if there was a top secret clearance, there would be more extensive investigation going on which perhaps would have

uncovered the gun part of this and maybe other things. speculation. this is a secret clearance. >> if i can just take it one step further, we are talking about revoke the clearance. what about requiring that employment be terminated? is that -- is that one of the things that you're considering in looking at going forward, that this person obviously for contractors that's a tough call? but certainly for government employment, to me it's not enough to just revoke their clearance. i think that it should be prima facie, a case that you now lose your job. there has to be serious consequences for not reporting. there has to be serious consequences for lying. and we have to look at the number of people out there who are not currently self-reporting. because even random checks cannot solve this problem. there has to be true consequences. and so i'm interested -- anyone in the panel, about how we're going to amp up the penalties for employees not self-reporting. >> you know, that's absolutely what we're looking at as part

of our 120-day interagency review. both the piece that you are talking about where are there any gaps in the self-reporting rtion versus an active reinvestigation period would address, that's in scope. what is the information that we collect and, you know, measured against 13 adjudicated standards and does it all flow right, that is all part of this. and then the accountability. here are currently significant penalties for, you know, lying or not reporting adverse information. yes, it includes revocation of your clearance. you mentioned contractors. an agency can, you know, suspend or debar the contracting firm. if they think it's just a problem with an individual, they can direct that that individual not work on that contract or you can suspend or debar the individual. and we're looking at all of the accountability measures for both federal employees and contractors to make sure that only the people who should have access to our facilities and

our sensitive information do at any given time, not just when they're cleared. >> you know, just human nature being what it is, if simply saying, well, there might be a consequence or -- the point that i'm getting at is a mandated, this is going to happen if you don't self-report. and mr. contractor, we don't know this. it's your job to help us enforce. it is your job to report back to us, and if you don't, black mark on you. you won't be a government contractor very long. and so that's -- that's the level at which i have passion for this issue, that we should not be letting -- when we give them the good housekeeping seal of approval, which is what this security clearance is, that ought to mean something. and if they breach it, that ought for something that we consider very serious with very serious consequences. and so i applaud your work. i would like to know how many have actually been discharged or disciplined for either lying on applications. obviously they wouldn't get the

clearance. but not reporting after the fact. mr. chairman, again, thank you for the time. >> thanks. those were tough questions. senator mccaskill. >> i think one of the most revealing things this morning is the realization that while an arrest report may be part of a background check, there is not a requirement that the underlying police report be obtained. and i tell you why this is a shocking revelation. like senator ayotte, i'm a former prosecutor, and the vast majority of cases that would review a mental disturbance will not have a disposition. the criminal justice system does a very bad job of adjudicating the mentally ill, because the mentally ill really, for a prosecutor's standpoint, if they haven't hurt anyone, putting them in prison sometimes creates more problems than it solves.

so most prosecutors, when they are confronted with a mentally ill issue, like someone who says they've heard voices, someone where the police has been called to a motel room on a disturbance where someone says there's microwaves coming through the vents and someone is -- people are here to get me, they will do a police report and most of the time the police department won't even try to file charges. that is a disturbance call that is related to someone in their minds, they do this all the time. now, that is not something that -- especially in a city as large as seattle or a city as large as kansas city or a city as large as st. louis, that kind of disturbance call, where someone is making a racket because they are mentally disturbed, most police departments won't even take it to the prosecutor for a disposition.

in fact, we are horrific in this country with even getting that person the mental health services. and the vast majority of these shootings are not going to be around the issue of whether or not someone has shown violent tendencies but whether or not they've shown tendencies of having a mental issue. so the notion that we are saying, well, if a police department won't give us a report, we've checked the box. and i think if we do a gut check on this issue, we will realize that a lot of the work we have been doing around this is checking boxes. now, i get it, that we can't go out and do one-on-one and pull every thread on every application for clearance. although if we did that, we would probably make them so expensive we would be much more disciplined about deciding who gets them. but the notion that you're calling what you're doing

quality control, ms. kaplan, is probably i think offensive, because i think there's just a lot of checking boxes going on. was this report obtained? yes. was this report obtained? what i don't -- where i don't have confidence is there's even on a random basis a more thorough examination. and i think that's something -- and i'm glad to hear you have a working group. what i'd like to see us do as a committee is ask for some specific recommendations on who is getting clearances and are they all necessary and all of this is risky. i mean, we can say we are doing too many and then we can have a bad thing happen and then we'd be back saying, why didn't they have a security clearance? on the other hand, what we're doing now is the worst of all situations because we're giving the impression in a all these millions of people who have --

that all these millions of people who have security clearances, we've checked them out. we're confident that they're mentally stable, they're not criminals and they obey the law. we have no idea if that's true. we are clueless as to whether or not that's true. because this process has become in a way a pro forma kind of process with contractors, and the reason the contractors were off the reservation is because they bid an amount and that contractor wanted to make money so that was time to cut corners. you wanted to make your number, you wanted to make money, you just turned it in, you just pretended like you did. so i agree with the chair and the ranking member that this is time for all of us to really, you know, quit nibbling around the edges on this thing and let's get to the meat of the matter. saying that seattle doesn't ve a police report, that dog doesn't hunt in this context. that just doesn't work.

and mr. lewis, i have a specific question for you. my subcommittee has learned that we have a bunch of felons on navy installations. e have learned that the navy was giving these contractors 28 temporary passes at the git-go without any checks on anybody. is that true? >> this was a subject of a d.o.d. i.g. report and the navy has looked into these specific circumstances. i believe there are about 50 people identified who were convicted felons who were given access without the proper checks. and the navy has taken corrective action, removing individuals who did not warrant access from the installations. in other instances, given the date that some of the felony convictions were quite old,

made a decision to allow them to continue to have access. but the fundamental issue is there was a failure to conduct the required checks for installation access and the navy has taken corrective action on that. >> and so no more -- no more temporary passes? >> the passes would have to be based on the required checks. the national criminal investigative check, as well as the terrorism database check. so that would bring up a felony conviction. >> ok. so what you're doing -- is there a different status for certain kind of pass than for a permanent pass now? are you saying they're doing something before they get a temporary pass, or are they getting the full compliment of checks? >> for installation access, there are two basic criteria. one is someone that's going to be on the installation on a

temporary basis. those individuals require a degree of vetting, the check against -- criminal records check and terrorism database check. for individuals who are going to have ongoing access, there is a requirement for a national agency check with written inquiries and other checks, which is the minimum standard for that issuance. >> so we corrected the problem that someone was getting temporary passes without any check? >> yes. >> is this going on in other branches, temporary passes with no checks? >> we're not aware of that, but we are certainly engaged with the components on this particular issue. >> ok. well, i would like a report back that this is not going on in any of the other branches. >> yes, ma'am. we'll do that. >> who made the -- whoever made the decision to allow that to happen to go around, were there

any consequences to that individual that actually made the decision? >> there's an ongoing navy review of what occurred at the navy yard that day to include all of the aspects that went into that and that's an ongoing review. >> could we hear back from the -- from you, this committee, when the review is completed as far as the consequences to the person who made that decision? >> the navy review, the overall d.o.d. reviews and ear reviews that are being -- and other reviews that are being conducted will be brought together in an o.m.b. final review overarching security practices, and i expect that to be part of the review. >> well, my specific question is a report back to the committee, was somebody held

accountable for going outside the curve, that's my problem is accountability in federal government. it's accountability. and all i want to know is what were the results of holding -- did we hold whoever made that decision accountable? >> i'd appreciate if you could close the loop at the end of the day for us, if you would, please. >> yes, we'll do that. >> ok. thank you. senator portman, please, welcome. >> thanks, mr. chairman. appreciate you holding the hearing. i think it's been constructive because we've raised obviously a lot of troubling issues and had the opportunity to hear from some senators who have a lot of interest and background in this. at the federal work force subcommittee, we held some hearings. in june, we held one regarding background investigations and specifically the inability of the o.m.b. inspector general to effectively audit the revolving fwund and really the background investigation process.

and that's where the score act was developed. senator mccaskill was still there. senator tester and the chair and ranking member and others. i'm pleased we were able to get that done. just a couple weeks ago we got it off the senate floor. it is a small step but it does fix that i.g. issue. i know, brenda, you worked with us on that. we got another hearing in a fwue weeks to continue look -- few weeks to continue looking at this issue and others. senator tester was here earlier. we're going to stay on this at the subcommittee level. i'm going to focus on something that i think is critical if we're really going to get at this issue. i guess the tragic example recently at the navy yard is unfortunately a perfect example of it. but it's not a new issue. it's this whole issue of continuous evaluation. and whether it's the five-year

cycle or 10-year cycle this is to me the critical issue that we're missing. and we saw it not just with regard to the navy yard but also with this ricky elder case. this is a specialist, ricky elder, who in 2012 shot and killed his commanding officer at fort bragg and then turned the weapon on himself. his clearance timeline was actually reminiscent of aaron alexis'. his background investigation was done in 2006. over the next five years, after 2006, weighs charged twice with assault, once with d.u.i. hit nd run, once with felony assault. none of which was reported in his personnel chain. aaron alexis, similar. after receiving a security clearance, he received nonjudicial -- disorderly conduct. another nonjudicial punishment

for being drunk and disorderly and arrest for firearm discharge. a month prior to the incident that would have highlighted his mental health problems, and none of these triggered a re-y valuation of his access -- re-evaluation to his access of classified material, classified facilities, none of those. and i think this is -- i mean, every issue raised here today is important, but if we can't get to this, the interim period between a clearance and, again, whether it's a five or 10-year cycle, i think we'll continue to have these tragic instances. in 2005, interesting, a year before ricky elder enlisted in the army, two years before aaron alexis enlisted in the navy, the department of defense testified to this committee, and this was in june of 2005, about the automated continuous

evaluation system. and you all said you are going continuously evaluate the background. mr. prioletti, in your written statement, you noted three years earlier in 2008 -- three years later, from the 2005 testimony you gave before his committee, president bush said individual is eligible for -- shall be subject to continuous evaluation. that was an executive order back in 2008. i know we heard today, we're working on this. we heard we have an interagency working group. we're developing a concept of operations. wroit this down. we're doing research. this has going on now for a decade. a decade. if you testified in 2005, was going on in 2004, maybe more than a decade. so here we are. it's five years after the executive order, eight years after this committee heard about the plans, and we're

dealing with the tragedy at the navy yard. i don't know who would like to talk about it. mr. lewis, maybe you can talk about d.o.d. by the way, you're talking about putting something in place but not for another three years and then it would be d.o.d. only. i glass i'd like to hear what is happening. and mr. lewis, since d.o.d. is trying to take the lead to get this in place, i see from the technical report on the project there have been some pilot projects. , and some 600 people have had clearances suspended or revoked due to derogatory discoveries. your search algorithms have found problems. buff 3,600 people is a drop in the bucket when we have over five million people with security clearances. this has been 10 years that we have told that lessons learned

is being incorporate understood database that will be in place in 2005, and here we are 2013. taxpayers have paid $11 million for this i don't know what the development costs are. we're trying to find out. or the cost after 2014 to fully demonstrate its capability at d.o.d. so can you explain the reasons why this capability will take over a decade to field? can you give us some sense of a total cost for this and what it's going to cost to field it over at the department of defense? >> i can't speak to the total cost. i would have to come back with hat information, but i can give you a status of how the automated continuous evaluation system sbg used. it -- is being used. it has the capability of flagging concern.

so that's an existing capability. as you mentioned, it was used in an army project. ut of 3,300-odd individuals, a total of 100 personal actions were taken as a result of information identified during those queries. in addition, the defense security enterprise is developing a continuous evaluation concept demonstration, which would take this a step further. aces, the automated continuous evaluation system, does a one-time snapshot in time query, this concept demonstration would have real time updates so that as information became available it would be pushed into the system. and the concept demonstration is currently scheduled to run from april to october of 2014.

the anticipated population would be 100,000 cleared military, civilian and contractor personnel. and so we're anxiously looking forward to completing that concept demonstration. in their interim, we're uses aces for continuous evaluation checks. again, testing the concept, guess getting more validation. looking at things like privilege users and some other groups of contractor employees. so this is an ongoing effort. we get results from it on a regular basis. and we are looking to take that to the next level in terms of a continue -- true continuous evaluation, which would give feedback to the system as it is developed. so if an individual gets arrested tomorrow, the system would push that back to d.o.d. instead of waiting for d.o.d. to make that query.

>> you weren't here in this job nine years ago when we heard that it was going to be in place by 2005, but you're here now. and so, you know, one question i could ask you is, why has it taken so long? and you might say, i don't know. i wasn't in charge. but you're in charge now, and you're saying that you're going to have this fully operational in three years, is that correct? >> for the automated continuous evaluation system, as it currently stands, it is -- it's an operational system. it's still in a research and development mode, but it is an operational system. the limits right now -- i mean, when i say operational -- >> i mean, when i say operational, i mean it would cover a small percentage of people in between their clearances. you're talking about taking to from 3,600 to 100,000. how many security clearances do you have about d.o.d.? >> we have 2.5 million people

who are eligible and in access to classified people. >> when will we cover those people? >> this -- the system, and one of the things we're examining is can we expand the capability of the system to handle that larger volume? and that is a work in progress and something we could -- >> do you think it's important? >> we, we do -- yes, we do. we need to address what happens between investigations. >> so what are you looking for in order to get this done? you're going to get back to us as to what the costs are. >> yes. >> have you sought additional funding? are you thinking that's the problem? >> it's a question of having the right criteria in place to conduct the evaluations and then what we do with the data once it's generated from the

system. how you evaluate that and how you take action based on that. >> my time is up and i apologize, mr. chairman. i think we've got to have some answers on this. if it we don't fix this problem, the initial clearance is incredibly important. we need to get arrest records. in the case of aaron alexis, it was clear as day. yet, there was no system to incorporate that data. prioletti to mr. and the intel side, i want to hear what you're doing, too. we don't have time but i hope you get back in writing what you're doing. we're talking about d.o.d. here. finally, i hope g.a.o. can help us on this to establish some metrics, let's come up with a timeline that makes sense. if you're looking for additional resources, let us know. if it's going to take another 10 years, because we're doing more pilots and more research

and so on, that is unacceptable. thank you, mr. chairman. >> thank you, senator. senator coburn and then i'll wrap it up. >> mr. jordan, can you explain to me the difference in the fieldwork contract and the supply services contract you have with uscis? one. wo, are contractors -- are these contractors from the same company? >> i can answer the first part. yes, contractors perform background investigations, yes, contractors can perform quality reviews on those investigations but only government employees make a determination as to whether to grant security clearance to someone. >> but my question is, is it the same company that's validating the work of their colleagues doing the investigation? is that correct? >> i'd have to defer to o.p.m. >> no.