SOVIET SPIES PROLIFERATE HERE; SENATE PANEL TOLD U.S. IS LAX

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000504150026-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: January 20, 2012
• Sequence Number: 26
• Publication Date: April 17, 1985
• Content Type: OPEN SOURCE

STAT
Declassified in Part - Sanitized Copy Approved for Release 2012/01/20: CIA-RDP90-00965R000504150026-2
DMfF!P-EARED
WASHINGTON TIMES
17 April 1985
Soviet spies proliferate here;
Senate panel told U.S. is tax
By Rita McWilliams
THE WASHINGTON TIMES
Soviet spies in the United States,
who the FBI call "more numerous,
sophisticated and agressive than
ever before;' have a massive pool
from which to recruit because the
government is handing out security
clearances too freely, a Senate sub-
committee was told yesterday.
Some 4 million Americans hold
clearances to handle government
secrets, including, according to
some Pentagon documents, thou-
sands of immigrants from commu-
nist countries, though there is no
reliable way of verifying their back-
ground information.
The way the government hands
out clearances is often a haphazard,
fragmented process, members of
the Senate Permanent Subcommit-
tee on Investigations were told.
Bill W. Thurman, deputy director
of the General Accounting Office,
said investigators at the Pentagon,
the Office of Personnel Manage-
ment, the FBI and his own agency
sometimes do an inadequate job of
checking 'backgrounds of U.S. citi-
zens seeking clearances, because of
huge backlogs.
For example, inadequate security
checks were made on Greek native
P. Takis Veliotis before he took
charge of General Dynamics Corp.'s
contracts for Trident and other
nuclear attack weapons constituting
a substantial portion of the
American strategic weapons cap-
ability, according to Fred Asselin, a
subcommittee investigator.
Mr. Veliotis has fled the country
in connection with his indictment in
an alleged $2.7 million kickback
scheme.
Despite discrepancies found by
U.S. agencies in his background
check, the Defense Department
reduced the facility clearance of a
Quincy shipyard from top.secret to
secret so General Dynamics would
not be violating national regulations.
A similar downgrading of secu-
rity status happened at the Electric
Boat shipyard in Groton, Conn.,
when Mr. Veliotis became its general
manager.
In 1973, Mr. Veliotis made a trip to
the Soviet Union and failed to report
it to federal authorities, Mr. Asselin
said. When the Energy Department
found out about the trip he was not
questioned about it and was given an
additional high-level security
clearance, he said.
Mr. Veliotis' employment form is
missing from the firm's files,
according to information given to
Mr. Asselin.
The FBI has not cooperated with
the subcommittee in the Veliotis
investigation, Mr. Asselin said, but
later an FBI official said they would
give reasons in writing for not hand-
ing over the file to the committee.
Testimony also revealed yester-
day that severe staff shortages exist
at the Defense Industrial Security
Program in the face of requests
from contractors for as many as
26,000 clearances per month.
Many of those requesting
clearances are plumbers, electri-
cians and, custodial personnel who
have no need for the special
clearances.
Phillip A. Parker, deputy assistant
director of the FBI's intelligence
division, estimated that about 30
percent of the 2,584 communist
country officials working in the
United States are known to be or are
suspected of spying.
Today, OPM director Donald
Devine and others are scheduled to
testify before the committee on their
methods of clearing workers to han-
dle government secrets.
Declassified in Part - Sanitized Copy Approved for Release 2012/01/20: CIA-RDP90-00965R000504150026-2