LETTER TO HONORABLE PETER W. RODINO, JR. FROM VERNON A. WALTERS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78M02660R000800040041-2
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 5
• Document Creation Date: December 19, 2016
• Document Release Date: July 14, 2005
• Sequence Number: 41
• Publication Date: January 29, 1976
• Content Type: LETTER

OLC 76-0206
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CENTRAL INTELLIGENCE AGENCY
WASHINGTON,D.C. 20505
2 9 JAN 19-176
Honorable Peter W. Rodino, Jr., Chairman
Committee on the Judiciary
House of Representatives
Washington, D.C. 20515
Numerous bills before the Committee on the Judiciary would require
large numbers of Federal employees, including certain employees of the
Central Intelligence Agency, to file annual financial statements with the
Comptroller General. A listing of these bills, introduced prior to 6 October,
is enclosed. The most inclusive of these bills would require statements
from all Federal employees earning in excess of $18,000 per year. Many
would require the statement to include:
(a) the amount and source of each item of income or
gift exceeding $100 in value;
(b) the value of each asset held by the employee
solely or jointly with a member of his family;
(c) the amount of each liability owned by the
employee solely or jointly with a member of his family;
(d) all dealings in securities or commodities; and
(e) all purchases and sales of real property,,
The Comptroller General is directed to prescribe the form and detail required
of the reports, which are to be available to the public under regulations
promulgated by the Comptroller General. Willfully failing to file a report
or willfully filing a false report will subject an employee to a potential
penalty of five years imprisonment and a $10,000 fine.
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The obvious purpose of these bills is to expose and prevent any
conflict of interest of Federal employees. These employees are now subject
to several Federal laws governing conflict of interest (18 U . S . C . 202, 203,
205, 207, 208, and 209). In addition, certain Executive branch employees,
including those of the Central Intelligence Agency, are subject to Executive
Order 1.1222 (dated 8 May 1965) "Prescribing Standards of Ethical Conduct
For Government Officers and Employees [As Amended] , " and regulations
issued by the Civil Service Commission and individual agencies pursuant
to E.O. 11222. These regulations require statements on financial holdings
by senior officers, and other employees at the GS-13 or above level who "are
responsible for making a Government decision or taking a Government action
in regard to: (1) contracting or procurement, (2) administering or monitoring
grants or subsidies, (3) regulating or auditing private or other non-Federal
enterprise, or (4) involved in activity where the decision or action has an
economic impact on the interests of a non-Federal enterprise. " 5 C . F . R .
?735.403 (1974).
The bills before the Judiciary Committee differ from the approach
of E.O. 11222 in two key respects. First, the bills require statements from
all employees of the Government above a specified salary level, regardless
of whether that employee's responsibilities present any opportunity for
conflict of interest or have any economic impact whatsoever on the interests
of any non-Federal enterprise. Second, and most important, E . O. 11222
provides for the strict confidentiality of financial statements, whereas the
bills under consideration would make the statements available to the general
public.
These bills would seriously inhibit this Agency's ability to conduct
its basic intelligence mission. In order to fulfill our primary responsibility
of providing our nation's policy-makers with accurate and current informa-
tion on foreign developments, a substantial number of our employees cannot
be openly identified with CIA. In some cases our employees are not even
identified with the United States Government. The public availability of
these financial statements would permit any American or foreigner residing
in this country to learn the identities of all CIA employees earning the
specified salary.
A related problem concerns the daily access CIA employees have to
highly classified information, information which would be extremely valuable
to hostile foreign intelligence services, and for which foreign services have,
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and would offer large sums of money. Numerous attempts have been made
by foreign intelligence services to recruit Agency employees. The disclosure
of the financial status of all CIA employees would assist opposition services
in identifying CIA employees for possible approach.
Congress has recognized that the Agency's ability to accomplish its
unique mission could be jeopardized by public disclosure of the names and
other data regarding CIA employees, as is required by these financial
disclosure bills. Accordingly, Section 7 (now Section. 6) of the Central
Intelligence Agency Act of 1949 (50 U . S . C . 403g) was enacted. This section
reads:
"In the interests of the security of the foreign intelligence
activities of the United States and in order further to implement
the proviso of section 403(d)(3) of this title that the Director of
Central Intelligence shall be responsible for protecting intelligence
sources and methods from unauthorized disclosure, the Agency
shall be exempted from the provisions of any....1aw which require[s]
the publication or disclosure of the organization, functions, names,
official titles, salaries, or numbers of personnel, employed by the
Agency...."
I believe that a serious question of statutory conflict with Section 6 of the
CIA Act might arise if a financial disclosure bill. was enacted which required
the public identification of CIA employees, and I request that any such bill
reported by the Committee exempt CIA employees.
Aside from the particular interests of this Agency, I also believe. that
the bills in question unnecessarily intrude into the privacy of Federal
employees by requiring public disclosure of their financial position, regard-
less of whether their responsibilities present an opportunity for conflict of
interest or have an economic impact on private financial interests. I urge
the Committee to consider this legislation in the light of the principles Congress
endorsed in the Privacy Act of 1974 (P.L. 93-559). While Federal employment
is a privilege and not a right, the public interest in attracting the highest
caliber of individuals to Federal service is best served by not differentiating
between Federal employees and other citizens unless there are persuasive
reasons for doing so.
Mr. Chairman, I oppose the legislation before the Judiciary Committee
which would require disclosure of the financial position of large numbers
of Federal employees. It would result in a substantial invasion of personal
privacy where no reasonable risk of conflict of interest exists. In the interest
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of resolving any possible conflict with existing law as it relates to publishing
the identities and related information of Agency employees, if such legislation
is favorably considered, I request that CIA employees not be included within
the scope of the bill.
The Office of Management and Budget has advised there is no objection
to the submission of this report from the standpoint of the Administration's
program.
Sincerely,
Vernon A. Walters
Lieutenant General, USA
Acting Director
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Bills Before the Committee on the Tudi.ciar~r
Requiring Federal Employees to File a Fi.naiciaTl
Statement with the Con- troller Genera).
94th Congress
H.R. 110
H.R. 5034
H.R. 929
I:I.R. 5249
H.R. 2053
I-l.R. 5250
H.R. 2359
H.R. 5251
H.R. 2684
1I.R. 551.6
H.R. 2685
H. R. 5877
11. R. 2926
11.R.. 6362
H.R. 3249
11. R. 6943
H.R. 3250
H. R. 7238.
H.R. 3756
H..R. 7876
H.R. 3788
H. R. 9121
I-I.R. 4636
II..R. 9558
H.R. 4740
H. R. 9685
H.R. 4909
11. R. 9901
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