A SECURITY BREAKDOWN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000404020011-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: July 14, 2010
• Sequence Number: 11
• Publication Date: July 15, 1981
• Content Type: OPEN SOURCE

STS Sanitized Copy Approved for Release 2010/07/14: CIA-RDP90-00552R000404020011-1
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ARTICLE APPFARBD
ON PAGE
THE WASHINGTON POST
15 July 1981
A Security Breakdown
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questi,
advers
By George Lardner Jr. sistenc
Washington. Post 3tntt writer tlgator
The CIA has a reputation for making the strictest se- N%
curity checks in the U.S. intelligence community, but its of Ma:
investigation of Max Hugel appears to have been a hur- The
ry-up, seven-day job that failed to sound even a mild
alarm about his complex business career. a a rep.
rep,-
Hugel, who held one of the CIA's most sensitive posts, alarm.
wasn't particularly helpful himself. His dealings with two Staple
Wall Street brokers in the early 1970s involved what them
Hugel described as attempted "blackmail," but he said he tency.
saw no need to report this or other details of the acrimo- They are uniformly full of praise,
nious relationship when he joined the agency earlier this depicting Hugel as a hard driving
year. millionaire whose "workaholic" hab-
its CIA's investigation posed a sharp contrast to the its constitute his biggest failing.
measured pace outlined in an official description of the In all, 28. people were interviewed
agency's standard procedure. in New York, New Jersey, New
Reaction from members of the Senate Intelligence Hampshire and Florida, although
Committee late yesterday indicated that the-Hugel mat- nine were just short time neighbors
ter could cause problems for the Reagan administration and aquaintances of acquaintances
on Capitol Hill. with nothing of substance to say.
As deputy director for operations, the post he resigned Those questioned at length in-
yesterday, Hugel had access to the government's top se- eluded Manchester (N.H.) Union
crets and directed the agency's global network of covert Leader publisher William Loeb and
intelligence agents. other individuals that Hugel gave as
The first interviews concerning Hugel were conducted references. They included his tax ad-
by the CIA's Office of Security beginning Jan. 14, just viser in New York and a business as-
one week before Hugel started work at the agency, and sociate in Florida who owns a pent-
the last were tedon Jan . 16. - house near Hugel's in Bal Harbour.
The e records indicate that Hugel The CIA also checked with what
had.been "cleared" at some CIA ech- it called "developed informants," but
elons on Jan. 19 and was given final this is apparently a catchall category
approval by the Office of Security, that includes everyone, except neigh-
pending some overseas checks, on bors, whom Hugel did not list as ref-
Jan. 21, the day Hugel started work erences.
at the agency. 'For instance, Robert Howard,
Some of the interviews, including president of the Centronics Data
a set in the New York area that con- Computer Corp., who had known
twined just a whisper of criticism, Hugel for more than 20 years,.was
were not put together and - synop- listed as a "developed informant." So
sized until March 6, several weeks was Roy Nagagawa, successor to
after Hugel had been given his first Hugel -as chief executive officer of
promotion, to deputy director for ad- Brother International Corp. in pis-
,ministration. - cataway, N.J., and an acquaintance
Through it all, however, the Office . since World War II.
of Security, which is responsible for The flavor of the interviews is re-
investigating everyone hired at the flected by those conducted Jan. 16
agency, from top officials down to in the Miami area, where Hugel was
the cleaning crews, evidently found ' described as "hard-driving, very ad-
nothing to arouse its suspicions ept, intelligent, capable of working
about Hugel's business dealings or well under pressure" -.a man
any other facet of his life. wealthy enough to relax, but who
Under a. longstanding directive was, nonetheless, accustomed to
from the director of central intelli- working 18 to 20, sometimes 24
gence, last updated in 1976, anyone hours a day.
to be granted access to "sensitive Police records turned up nothing
compartmented information" - but three speeding tickets in Nash-
Sanitized Copy Approved for Release 2010/07/14: CIA-RDP90-00552R000404020011-1