NOMINATION OF E. HENRY KNOCHE TO BE DEPUTY DIRECTOR OF CENTRAL INTELLIGENCE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00901R000600010002-2
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 32
• Document Creation Date: December 19, 2016
• Document Release Date: November 3, 2005
• Sequence Number: 2
• Publication Date: June 23, 1976
• Content Type: OPEN

NOMINATION OF E.
HEARING
SELECT COMMITTEE ON INTELLIGENCE
UNITED STATES SENATE
NINETY-FOURTH CONGRESS
SECOND SESSION
NOMINATION OF E. HENRY KNOCHE, TO BE DEPUTY
DIRECTOR OF CENTRAL INTELLIGENCE
WEDNESDAY, JUNE 23, 1976
Printed for the use of the Select Committee on Intelligence
U.S. GOVERNMENT PRINTING OFFICE
74-893 WASHINGTON : 1976
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SENATE SELECT COMMITTEE ON INTELLIGENCE
(Established by S. Res. 400, 04th Cong., 2d seas.)
DANIEL K. INOUYE, Hawaii, Chalrrnaa
HOWARD H. BAKER, JR.; Tennessee, Vice Chairman
BIRCH BAYH, Indiana
ADLAI F. STEVENSON, Illinois
WILLIAM D. HATHAWAY, Maine
WALTER D. HUDDLESTON, Kentucky
JOSEPH It. BIDEN, JR., Delaware
ROBERT MORGAN, North Carolina
GARY HART, Colorado
CLIFFORD P. CASE, New Jersey
STROM THURMOND, South Carolina?
MARK 0. HATFIELD, Oregon
BARRY GOLDWATER, Arizona
ROBERT T. STAFFORD, Vermont
JAKE GARN, Utah
MIKE MANSFIELD, Montana, Ex Officio Member
HCGII SCOTT, Pennsylvania, Ex Ojfzcio b?enl'er
WILLIAM G. MILLER, Staff Director
HOWARD S. LIEI3EN000D, Deputy Staff Director
MICHAEL J. MADIGAN, 911hiority Gaumtsel
AUDREY If. IIATRY, Clerk
(II)
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CONTENTS
Statement by Senator Jennings Randolph----------------------------
Page
I
Statement by E. Henry Knoche, nominee to be Deputy Director of Central
Intelligence------------------------------------------------------
3
Provisions of Executive Order 11905 establishing a Deputy Director of
Central Intelligence -----------------------------------------------
17
Personal information supplied by nominee----------------------------
194
E. IT. Knoche responses to June 24, 1976 written interrogatories submitted
by the Senate Select Committee on Intelligence----------------------
21
E. H. Knoche responses to additional interrogatories submitted by Senator
Gary Hart--------------------------------------------------------
27
Letter to Chairman Inouye from CIA General Counsel Anthony Lapham,
June 7, 1976.-----------------------------------------------------
31
Letter to Chairman Inouye from E. Henry Knoche, June 7, 1976
33;
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NOMINATION OF E. HENRY KNOCHE TO BE DEPUTY
DIRECTOR OF CENTRAL INTELLIGENCE
WEDNESDAY, JUNE 23, 1976
U.S. SENATE,
SELECT COMMITTEE ON INTELLIGENCEi
Washington, D.C.
The committee met, pursuant to notice, at 9:46 a.m., in Room 235,
Russell Senate Office Building, Hon. Daniel K. Inouye (chairman)
presiding.
Present: Senators Inouye, Baker, Bayh, Stevenson, Hathaway,
1Iuddleston, Morgan, Case, Thurmond, and Garn.
Also present: William G. Miller, Staff Director; Michael Madigan,
Minority Counsel.
The CHAJRMAN. The Select Committee meets today to consider
the nomination of Mr. E. H. Knoche for the post of Deputy Director
for Central Intelligence. The committee has already had the oppor-
tunity of hearing Mr. Knoche in executive session during a 5-hour
on held last week. I can report that Mr. Knoche demonstrated
through extensive testimony that his qualities for the post are of an
extraordinarily high order.
Senator Randolph was invited and accepted our invitation to intro,
duce Mr. Knoche to our committee. He was here earlier but, due to
the delay to commencing the confirmation hearing, it was necessary
for Senator Randloph to leave to attend committee meetings of
Public Works, of which he is chairman, and Post Office and Civil
Service. His statement follows in the record,
STATEMENT BY SENATOR.JENNINGS RANDOLPH
Thank you, Mr. Chairman, for inviting me to join in this hearing on the con-
firmation of E. Henry Knoche as Deputy Director of the Central Intelligence
Agency. It is a genuine pleasure for me to introduce this native West Virginian,
who for the past 23 years has served the Agency in a variety of top analytic and
management positions. Prior to this hearing, I met with Mr. Knoche and his sons
to discuss in &kneral his thoughts about the vital mission of the CIA and the devel-
opment of its programs and associations internationally.
As you know, he is a native of Charleston, West Virginia, where his father was
engaged in the insurance business. Ile left our State with his parents at a very
early age. However, he returned to his native State to attend Bethany College.
While at Bethany, he was a varsity basketball and tennis player and participated
in a number of tennis tournaments at nearby Oglebay Park in Wheeling.
Mr. Chairman, the nominee's distinguished career and achievements as a
public servant are known to this committee. I genuinely appreciate this oppor-
tunity to provide these brief remarks of introduction and urge you and. the
members of the committee to give thoughtful and, hopefully, favorable considera-
tion to Mr. Knoche's nomination as Deputy Director. Thank you.
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The CHAIRMAN. This is the first nomination that the Select Com-
mittee on Intelligence has had to consider since it was formed on
May 19. The post of Deputy Director of Central Intelligence is an
important one. The investigations of the past year and important
shifts in the international scene have caused changes to be made in
the intelligence community. The new Deputy Director will have
increased responsibility not only in the day-to-day management of
the Agency, but in helping to meet the serious new problems created
by changing power relationships in the world.
The nomination of Mr. Knoche, who has spent most of his 23-year
career on the analytic side of the Agency's work, is an important
indication of the emphasis that the U.S. Government now places on
the intelligence analysis function. The provision of the most accurate
and timely information about the capabilities and intentions of other
nations and groups, to the President, his advisers, and to the Congress
is the main reason for the existence of the Central Intelligence Agency
and the intelligence community. I am pleased that someone with
Mr. Knoche's qualifications and experience has been proposed for
this post.
Both the executive branch and the Congress are undergoing a
reevaluation of their purposes and responsibilities, as well as a new
definition of their relationship to each other in the area of intelligence
activities. Significant changes are taking place. They are long over-
due. To make them work will require mutual cooperation and under-
standing between the branches of Government. This committee will
make every effort to carry out its responsibility to oversee the
intelligence activities of the United States with vigor and effectiveness.
It will make every effort to assure that the intelligence agencies of
the United States are the best in the world, but perform their necessary
functions under the law.
The duties placed upon this committee are many. We must monitor
all the activities of the agencies. We must write new charters, clearly
defining the missions of the intelligence agencies. Most important,
we must restore confidence in the belief that the intelligence agencies
of the United States are serving to preserve and strengthen the
liberties of the American people.
Before calling on our nominee, I would like to recognize the vice
chairman of the committee, Mr. Baker.
Senator BAKER. Mr. Chairman, thank you very much. I join in
welcoming Mr. Knoche to this first series of confirmation hearings.
The hearings, as the chairman pointed out, are significant even
beyond the importance of the confirmation of this nominee in that
they represent, I believe, a historic first, the exercise of institutional-
ized and regularized public congressional oversight of the intelligence
community. It is a matter of great interest to me and one that I have
hoped for and worked for for a long time.
I join the chairman as well in saying that I believe this man to be
extraordinarily well qualified to serve in this position. I would also
like to say in advance that based on the testimony that we have
received in executive session, and having observed his conduct and
demeanor while testifying on matters of great sensitivity previously,
and having examined his financial disclosures and other materials
given to the committee, I am prepared to say that I intend to vote
for his confirmation as Deputy Director.
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The CHAIRMAN. Any further statements before we call upon Mr.
Knoche?
Then the committee welcomes you, sir, and if you do have any
statement, it is your show now.
Senator THTJRMOND. Mr. Chairman, I might make a brief
statement.
The CHArRMAN. Senator Thurmond?
Senator THURMOND. I have been impressed with Mr. Knoche, his
background, his training, and I think he is well qualified, and I shall
be pleased to support him.
The CHAIRMAN. Shall we close the meeting at this point?
[ General laughter.]
STATEMENT BY E. HENRY KNOCHE, NOMINEE TO BE DEPUTY
DIRECTOR OF CENTRAL INTELLIGENCE
Mr. KNOCHE. Thank you, Mr. Chairman, Mr. Vice Chairman,
Senator Thurmond.
I do have a statement, Mr. Chairman, that I would like to read for
the record.
Mr. Chairman and members of the committee, I feel very privileged
to appear before you today, having been nominated by the President
for the post of Deputy Director of Central Intelligence.
[ have served the country in military service and in intelligence
work for more than 28 years, the last 23 of which have been in the
Central Intelligence Agency. Most of my service in CIA has been
connected with intelligence analysis and production. I have also
served as a staff assistant to both the Director and the Deputy
Director of Central. Intelligence. More recently, I was the Director's
assistant for liaison with the President's Commission on CIA Activities
within the United States as well as with the Select Committees of
the Congress in connection with reviews of past intelligence activities.
Most recently, since last August, I have been assigned as an Associate
Deputy Director engaged in helping the Director to coordinate the
activities of the entire Intelligence Community, including CIA.
In the job for which I have been nominated, I will serve under
Director George Bush. In accordance with his wishes and as directed
by the President's Executive Order 11905 of February 18, 1976, I
will act as the officer responsible for the day-to-day operation and
management of the Central Intelligence Agency.
Mr. Chairman, the CIA is responsible for collecting, evaluating and
disseminating foreign intelligence information and judgments. Our
purpose is to inform or alert the President and his advisers about
foreign situations and prospects. The better we do in our work, the
easier is the Government's task of formulating foreign policy. Keeping
the peace rests in large measure on our ability to provide the best
possible intelligence assessments.
The collection, analysis, and production of such intelligence today
requires a combination of technology, human sources, and special
methods. Secrecy of necessity surrounds this work. The secrecy is
necessary not because we wish to keep the American public in the
dark, but simply because it is often easy for potential foreign ad-
versaries to counter our ability to gather information. In short, we
could be blinded if our sources and methods became known. As this
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4
committee knows, the Director of Central Intelligence is charged by
law with protecting our Nation's intelligence sources and methods.
The CIA, when directed by higher authority, also carries out
certain covert actions to lessen the prospects of hostilities or other
problems abroad. There appears to be general agreement and certainly
I feel strongly, that our Government needs such a capability.
Mr. Chairman, out of the reviews of American intelligence carried
out first within the CIA and later by the President's Commission on
CIA Activities Within the United States have come new guidelines
for conducting intelligence activities in the form of the President's
Executive order and policy statements and regulations issued by
Director Bush. It is recognized that Congress may wish to add to
those guidelines.
We know that strong oversight arrangements in the Executive
and in the Congress will be features of our future. We welcome them.
I pledge to you that we will meet the external oversight with improved
internal management and oversight to keep our work within the law
and the bounds of propriety. I want to assure this committee, and
through it the Congress, that the CIA is a disciplined and constructive
agency, one that will adjust to and abide by the guidelines set for it in
carrying out activities so important to the well-being of our country.
Let me add here a personal assurance. As a Presidential. appointee
confirmed by the Senate, I would be very much aware of the fact that
I will be fully accountable to the Director, to the President, and to
the Congress for my actions and those of the Central Intelligence
Agency.
The CIA and its people have been the subject of much criticism
over the past year or so. Despite the turmoil, our people have proved
their professionalism; day-to-day efforts to collect and evaluate
foreign intelligence information, and to produce assessments of foreign
situations, have never flagged.
Working with Director Bush, I will do my very best to continue the
CIA's productive work and to keep it fearlessly honest and objective.
I believe the quality of the work is very high, and I will strive to make
it even better. The CIA's intelligence product must be responsive to
the needs of the President and the National Security Council. We
want to improve our intelligence support of the Congress as well, and
we will cooperate as fully as possible in meeting Congressional needs.
To sum up, Mr. Chairman, I would like to say that I am proud to be
a career intelligence officer of CIA. I believe deeply that it is essential,
given the nature of the world, that our country have a strong and
effective foreign intelligence capability. The quality of the men and
women in CIA and their professional discipline and patriotic motiva-
tion is extremely high. I know I can count on their full support.
Mr. Chairman, I hope that the confidence the President and Mr.
Bush have placed in me by nominating me for this difficult job is
justified, and I hope I will have your confidence as well. Certainly
I look forward to facing the challenges and the opportunities in the
tasks ahead.
Thank you very much.
The CHAIRMAN. Thank you very much, Mr. Knoche.
Being aware that all of us would like to participate in the questioning
of Mr. Knoche, I would like to limit the first round to 10 minutes
per member, and I will begin the questioning.
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A number of significant CIA policies are embodied in CIA internal
regulations rather than being fixed by statute. As the head of the CIA
the DCI can waive the application of these regulations, or simply
change them, without notifying Congress. If confirmed, will you
provide the committee with a full set of CIA regulations, and will you
notify the committee of any changes that affect these regulations?
Mr. KNoCIHE. Yes, sir.
The CHAIRMAN. The authority of the CIA to engage in certain
activities rests on directives issued by the National Securityy~ Council
called National Security Council Intelligence Directives, NSCID's.
These NSCID's were often referred to as the CIA's "secret charter"
and were withheld not only from the public but also, until recently,
from Congress. If these NSCID's are revised, or if new NSCID's are
issued, will they be provided to this committee?
Mr. KNOCHE. Sir, I don't want to cavil in answering that. As far
as I am concerned, they should be provided to the committee; how-
ever, there are intelligence directives of the National Security
Council, and the Central Intelligence Agency is not the custodian
of them. I think the full answer to your question has to come from
elsewhere within the executive. But I certainly in principle have no
objection whatsoever to. providing the NSCID's.
The CHAIRMAN. Since 1961 the GAO has not audited the expendi-
tures of the CIA. Specially cleared GAO auditors are now auditing
NSA expenditures; others will have access to FBI materials. Are you
willing to let specially cleared employees of the GAO, the investigating
arm of Congress, have access to all CIA materials on expenditures?
Mr. KNOCHE. That is certainly worth considering, Senator, and I
don't have any personal objection to that whatsoever. I think wox-king
with this committee and others that might be formed of a somewhat
similar charter on the House side, that we would want to work
together to develop some guidelines for that.
I am not at all sure what happens in the case of GAO reporting as to
what extent their findings. and recommendations are made available
across the board through the entire Congress. There will be some
sensitivity, some secrecy that attaches to any such GAO study, and
the manner in which that is controlled and focused within, the properly
constituted oversight authorities of the Congress is something that.
we would want to consult about.
The CHAIRMAN. Prior to 1961 GAO did audit your books. Did you
find this to be a reasonable and satisfactory practice?
Mr. KNOCHE. It gave its no particular pain, but I think the head of
the GAO had some difficulty with it. One of the things that conflicts
a bit with the GAO's charter is the statutory responsibility of the
Director of CIA to protect sources and methods, and I think that if
the Congress in its wisdom wants to employ the GAO to. go into the
intelligence world, that we need to develop some guidelines as to how
we can work out the proper arrangements there.
The CHAIRMAN. May I request through you that the CIA and its
appropriate officials get together with GAO and come up with sug-
gested guidelines that we can look over?
Mr. KNOCHE. Certainly, sir.
The CHAIRMAN. The Hughes-Ryan amendment provides for Presi-
dential certification that the covert actions undertaken by the United
States are important to the national security. The law also requires
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that the appropriate congressional committees be briefed on all covert
actions, not just major projects. Can you assure the committee that
it will be notified of all covert actions?
Mr. KNOCHE. Yes, Mr. Chairman,. I think that working with the
committee and the staff, we can develop ways for doing that in an
orderly and regular way. There are a number of small details that
pertain to some forms of covert action, but I think that we can work
out an arrangement with the committee whereby they would be
categorized and made the subject of periodic briefings, and I would be
glad to work with the committee and the committee's staff in trying
to do so.
The CHAIRMAN. I have several questions here that I believe should
be submitted to you in writing because of their sensitive nature. May
I request that these questions be studied and responses be made for
classified files, sir?
Mr. KNOCHE. Indeed, sir.
The CHAIRMA1T. Under Executive Order 11905, the General Coun-
sel and the Inspector General are required to report to the Intelligence
Oversight Board on activities that raise questions of legality and
propriety. They must report allegations involving such activities and
the results of their investigations. They are also required to report any
instance where they are instructed not to make such reports.
Will you instruct the General Counsel and the Inspector General
to provide to this committee similar reports to aid this committee in
its oversight function?
Mr. KNOCHE. Yes, sir, I will.
The CHAIRMAN. At present the General Counsel is required to
refer to the Department of Justice allegations that activities by CIA
employees violate Federal law. In order to assist the committee in its
oversight role will you instruct the General Counsel to notify the
committee when and if such a referral takes place?
Mr. Kti OCHE. Yes, sir, I will.
The CHAIRMAN. Since 1973 the Director of Central Intelligence
has regularly issued a call' to CIA employees to report to him any
activities which raise questions of legality or propriety. Early this
year Mr. Bush issued such a call. Will you regularly remind CIA
employees of this duty?
Mr. KNOCHE. I think this is a desirable practice and I intend to see
to it that it is continued, sir.
The CHAIRMAN. If an Agency employee were fearful, for whatever
reason, of reporting a questionable activity to either the CIA Inspector
General or the Intelligence Oversight Board, should he or she be able
to come directly to this committee without fear of reprimand?
Mr. KNOCHE. Indeed, sir.
The CHAIRMAN. One of the most effective tools of the Inspector
General is the component survey, an indepth study of a particular
segment of the CIA such as the Office of Current Intelligence. Will
you have the Inspector General notify this committee of the schedule
of component surveys and make the results of the surveys available.
to the committee?
Mr. KNOCHE. I will be glad to work out arrangements to try to
keep this committee informed of the surveys, sir, but I would like to
take a slight reservation in committing myself to making the fullness
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of suck investigations, 'available to this committee,- not because I
wish to withhold the findings and conclusions of . such-a report, but.
simply because I don't want to inhibit the process by which. they are
made within the agency. We regard those as management tools.
They are -findings and views with the bark off so that we can, as man-
agers of the place, take. actions as appropriate to deal with anything
that is out of order.
But if they are written with an eye toward the outside, the process
could be inhibited, and I would like to work with the committee to
develop means and ways of assuring that this committee is informed
in general, and hopefully in as specific ways as possible of the findings
of Inspector General surveys within the Agency, but I hesitate to
commit to providing this committee with a full set of the Inspector
General's findings.
I don't wish to pick a fight on this issue at all, but I do believe that
there is wisdom in keeping within the management of the Agency a
cleansing process of that type, and working with the committee in
establishing ground rules on how we can keep the committee informed
on those findings.
'flee CHACPMAN. Fine, sir.
It has been suggested that CIA employees having access to secret
intelligence might misuse that information to personally profit from
their positions of trust. What steps have been taken to prevent this
from occurring?
Mr. KNOCHE. Those CIA employees who have a managerial re-
sponsibility in which there is a potential for a conflict of interest, as
in the case of those CIA employees who must authorize contractual
relationships for procurement of supplies, must,make a confidential
rendering of their holdings to higher authority within the Agency sa
that a determination can be made by the supervision within the
Agency and by the lawyers within the Agency as to whether there was
a conflict of interest involved. We regard that as a safe practice, one
that we would intend to head off any malfeasance or any problem.
The CHAIRMAN. Well, thank you very much. I know my allotted3
time is expired.
I would like to recognize Senator Bayh.
Senator BAYH. Thank you, Mr. Chairman.
Mr. Knoche, I, too, was very impressed with your participation in
the briefing which we bad in executive session and was impressed by
your past record of public service, and I am prepared to support your
nomination.
I would like to confine my remarks, Mr. Chairman, to one specific
area that really was raised in your initial questioning relative to the,
Hughes-Ryan Act.
Mr. KNOCIIE. Yes, sir.
Senator BAYH. This act requires that appropriate committees of
Congress be briefed on all covert action. Of course, this is one of those
committees. Your response indicated a willingness to deal with this
in a manner that would make it possible for us to manage, if I inter-
pret it, the volume of such information.
The information that has been made available to this committee so
far indicates that there are varying degrees of covert activity as far
as their impact on our country, its policy, and the world in tote.
Mr. KNOCHE. Yes, sir.
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'Senator BAYS. Some of the relatively insignificant as well as the
significant items were brought to our attention earlier, and we were
made painfully aware of where certain covert activity can lead and
impact on this Nation or others.
I am concerned about what you can do in your post, and what Mr.
Bush can do in his post, to make certain that those of us who are rep-
resenting the Congress of the United States, can have some knowl-
edge and thus some input into covert activities that are not relatively
insignificant housekeeping operations; but which, if permitted to
assume that initial momentum, can snowball and lead to consequences
that have a rather dramatic impact. I realize that the President has a
very strong initiating role in this, but as a Member of Congress I am
not prepared to let that go, absent the kind of perusal that I think this
committee is supposed to give it. Could you give us your thoughts in
particular? I make it a statement instead of asking a question here,
but I would like to get your general thinking on how we handle this.
I admit to you, sir, I have mixed feelings about covert activity.
I think common sense can point out some areas where it is in the best
interest of the United States, and if that policy were put to a ref-
erendum we would get 98 percent support of the people. Yet, if the
way we proceed to make that policy or implement that policy is made
public in advance, it might destroy our ability to achieve that pur-
pose. On the other hand, I feel that if it is in the best interests of this
country, why shouldn't we throw it out on the table and let the people
know what is going on? Why should we have to find out about funds
being channeled one way or the other, or mercenaries ending up in
places where, after the fact, we wish they weren't?
Could you tell us what you can do, in line with your responsibilities,
to help us have input in this kind of thing before it is too late?
Mr. KxocnE. Well, let me take a crack at that. That is a very large
order indeed, sir. What you are basically talking about is the relation-
ship between the Congress and the highest authority in the executive
.department. We in CIA are but an instrument within the executive
.department. So you have given me a very tough question to answer,
but let me take a crack at it.
In the first place, when this Government resorts to covert action
as a means of trying to ease or modify a foreign situation which has
elements of danger within it, it has basically two choices at either
extreme. One is either a diplomatic note or a visit by an ambassador,
which tends to be very pro forma, formal, and has the official American
handle all through it; all the way to the other extreme of sending in
the Marines, or taking very aggressive action to correct that dangerous
situation abroad. Covert action is designed to be middle ground
between those two extremes, in which one goes about quietly, hope-
fully intelligently, to modify the situation in the best interests of
the United States.
Now, one of the things that makes covert action so difficult and
so controversial is that you employ it, any government employs it,
only when the stakes are rather high and when a diplomatic note
on the one end of the spectrum is not going to work out your problem
for you and you don't want to go to war on the other end of the
spectrum. So the odds are tilted a little bit against the prospects
for covert action being entirely successful in the first instance. If it
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was an easy kind of a problem to deal with, you would use the am-
bass$dor and a diplomatic note in the proper formal relationships
between countries.
When the Government is considering a resort to covert action in
the case of a very difficult international situation, I think CIA should
employ its best intelligence analysts, those who earn their pay by
making judgments about how things are apt to take place over the
next several years, to judge the effects of a failure of a covert action
or provide an input to the planners of a covert action. That way we
get a better mix of inputs into the planning of a covert action-the
analysts as well as the operators.
I think, to be useful to the President and to others in the executive
charged with carrying out foreign policy, that we in intelligence can
give them a more rounded package to operate from when they are
deciding on whether or not to employ covert action as a moans of
advancing American goals or objectives.
I don't know whether that is helpful to you.
Senator BAYH. Well, let me pursue it just a bit because I realize,
as you pointed out, this is a question that involves the CIA almost
being between a rock and a hard place, if indeed there are differing
opinions between what Congress might desire and what the President's
thoughts are. My question really goes to the timing of getting us
involved in this oversight process before it is too late.
Now, let me use two specific examples and ask you 'not to got
involved in a controversy between the President and Congress, but
to tell this committee where you feel your responsibility is as far as
letting us know when we should have access to this information.
Example one, the President believes that in a certain country it is
important enough to the interests of the United States, that we
should take money channeled through the various CIA sources and
pay mercenaries to participate in an armed confrontation. Example
two, suppose it is the President's feeling that because large amounts of
money are being poured into a country to try to affect the outcome of
an election that is supposed to be determined by the people living
within the country, it is necessary for this country to provide funds
to try to balance it so the people will have a chance to make an
objective decision. How do you feel that we should be informed on
the situation?
Mr. KNOCHE. Well, Senator Bayh, I don't want to give you a
cop-out on that one, but basically the CIA is an instrument of Ameri-
can foreign policy. When higher authorityand in our lexicon, when
we talk about higher authority we are talking about the President,
the Secretary of State, and . the President's Assistant for National
Security Affairs-when those gentlemen, in their judgment, decide
that there is something useful for intelligence to carry out by way of
covert action, we find ourselves involved in that kind of thing. We
are not the judges as to when we perform covert action, we are tasked
by those above us who control us.
As I say, I don't want to give you a cop-out in trying to answer
this. It is a very difficult question. But I think this committee is
going to have to get some understanding from the White, House or
from the Secretary of State on the policy objectives,. what it is that
is intended. We are simply the. instrument through which this kind
of policy is carried out.
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10
Now, I don't know that that, answer' is entirely satisfactory. `
Senator BAYH. Well, it isn't. Let me be frank with you: I don't
know that you can give any other answer, but it is not very satisfactory
to me because I assume we can take this President"or some subsequent
President, whoever that might be.
Senator GARN. Will the Senator yield for just one comment?
Senator -BAYH. Yes.
Senator GARN. Birch, I think one cornment, we are in the early
stages of forming our own. rules and regulations, and I agree, the
answer is not entirely satisfactory, but I don't think that Hank can
answer it at this point. I think as we work over the next 2 or 3 months,
I think that is one of our specific charters in S. Res. 400 that we must
come up with guidelines.
So I think we as a. committee working with the CIA and the adrnin-
istration, that is our specific charter, to come up with some rules and
regulations and guidelines as to exactly how your question will be
answered and how we will be notified.
My point is I think it is a little premature for any of us. I don't
,know the answer to the question either. I agree with what you are
saying, there has got to be some means whereby we will be notified
and can have input before it is after the fact.
Senator BAYH. I think Mr. Knoche was right on target when lie
recognized the conflict between ultimate authority in the executive
branch and the legislative branch. That's what I mean, you are in
the middle.
Mr. KNOCHE. That's right.
Senator BAYH. It cannot be answered. I was about to say, and I
appreciate my colleague's giving us his thought about it, but I don't
think you are going to answer sitting here. What we had better ask
this committee is, and we had better let you know, or at least I as
one member of the committee want to let you know that I want us to
get information at the earliest possible moment so that we can have
some congressional input before the horse is out of the barn.
We are going to have to develop that with the President, and I
don't ask the question just to this President. Heavens, we have had
a track record back over the years, and I suppose we are going to have
to work this out with other Presidents as they come and go. But I
think this is a very important area, and I would like this committee,
Mr. Chairman, to be on record as wanting that information as quickly
as we can have access to it.
The CHAIRMAN. With that, I would like to most regretfully advise
you that your time is up.
Senator BAYH. Well, I am ready to yield.
The CHAIRMAN. Senator Garn?
Senator GARN. I have no questions, Mr. Chairman, since I had an
opportunity to sit: clown in the executive session and meet Mr. Knoche
personally in my office and talk to him. I think he is one of the best
appointments I have seen in the relatively brief tune that I have been
in the Senate, on this or on my other committee assignments as well.
I am very pleased with the appointment, and happy to vote for his
confirmation.
Mr. KNOCHE. Thank you, Senator Garn.
The CHAIRMAN. Before proceeding, I would like to announce that
we have with us a proxy from Senator Goldwater supporting the
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nominatiga of Mr. Knoche, from Mr, Huddlestoli, likewise,.andironq
Mr. Hathaway. Regretfully, I wiil have. to be leaving here soon to
preside over the markup of an apppropriations bill, and _ so I will re-
linquish the chair to Senator Bayh. Before doing so, I would like to
recognize Senator Stevenson.
Senator STEVENSON. Thank you, Mr. Chairman.
Mr. Knoche, I share the sentiments of my colleagues. I, too, have
been favorably. impressed by, your professionalism and all of your
qualifications, demonstrated by your statements and conversations
and in the prior meetings of this committee.
Mr. KNOCHE. Thank you, Senator.
Senator STEVENSON. Among those qualifications, with your (back-
ground in analysis, can you tell us what if any thoughts.you have, or'
plans for umproving the analytic capability of the Agency?
Mr. KNOCHE. Senator Stevenson, I think you have put your finger
on the most important area that we-confront. We are happy to tell
ourselves, and we often do, that the CIA product is the best that is
available in town. Well, that is simply not good enough. It needs to
be made better and I think the fundamental challenge before us in, the
analytical, and production area of intelligence is to blend together the
various disciplines. Increasingly in this very complex world in which
we live we find that it is no longer apropos simply to make a political
judgment about a political situation in some foreign country, or merely
to count up the potential adversaries, divisions, and airplanes in,the'
field, that, is, military analysis.
Today when one is trying to assess foreign leadership and how that
foreign leadership might make its decision, you have to take a look
across the: board, the domestic political situation in that country, the
military situation, its strengths, weaknesses, certainly the economic
situation not only. within that country but internationally, and how
that foreign leader will make his decisions in the face of those con-
flicting kinds of pressures, to say nothing of his own domestic political
situation, his own sense of strength and weakness.
Over the years the organization of the analytical components of the
intelligence community has tended to be specialized in politics, mili-
tary affairs, economics, geography and so on. It is my.view that the
future, sophisticated analyst, will be an expert and a practitioner in
all of those fields. And it is a blending of all of those things and trying
to judge foreign countries and their likely evolution that is the chal-
lenge before us.
Senator STEVENSON. Do you have any specific plans for improving
that capability within the Agency.
Mr. KNOCHE. Yes, sir, I do. As I have said, that to me is the first
and foremost of the tasks that confront us within the Agency, and I
intend to keep that on the front burners, as long as I am in this
position, assuming I am confirmed.
I have only one other word, and that is that the mode of presentation
of intelligence is an important thing to think about in the future. We
hire, promote, and advance intelligence analysts on their ability to
write and to put out the printed word. Increasingly we are running into
policymaking consumers of intelligence information who are ac-
customed to getting their information in different modes, either
through oral presentations or electronic presentations. There is a
new breed or a new generation of consumers of intelligence products,
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and we have got to keep abreast of new media to make sure that we
can get across these very difficult depictions of foreign situations in
ways that go beyond the mere printed word.
Senator STEVENSON. That statement is reassuring to me as far as
it goes, and I am concerned that the sources of American authority
in the world and security are not rooted exclusively in military, and
not just political, but increasingly, economic conditions that need
careful study and analysis for the purposes which are not just the
economic.
Now, it is not enough, it seems to me, just to improve the analytic
capability of the Agency. The analysis can be only as good as the
intelligence.
Mr. KNOCHE. Yes, sir.
Senator STEVENSON. At some point decisions have to be made as to
what kind of intelligence should be collected. What can you tell us
about how those decisions will be made with specific reference to
procedures for cooperation between the Central Intelligence Agency
and the agencies for intelligence within the Department of Defense
which have a major collection responsibility? How can we be assured
these procedures for the determination of what will be collected will
reflect the kind of considerations that you have mentioned, and
safeguard against any temptations in the Defense Department to go
for the exclusively military data?
Mr. KNOCHE. I think that is a very valid question, Senator Steven-
son, and one that deserves our continuing attention within the intel-
ligence community. We have tried very hard to devise collection sys-
tems to be matched against very specifc sets of questions and require-
ments, and we have tried very hard in a collective community kind of
way to set priorities against those needs so that we are not short-
circuiting the collection of interdisciplinary kinds of information,
military, political, economic, and so on.
One of the things we have not done too well and are trying hard now
to improve is the evaluation of all this. How good is the collection
machinery in responding to the needs that we set for it? Must we
always give requirements to all of our collection vehicles, whether they
are technological or human resources? The answer to that is obviously
no, because nobody can afford that large intelligence budget. We have
got to be more intelligent, more selective about what questions we
give to our collection capacity in ways that will help us answer the
problems that confront the pohcymakers.
I hope that answer is helpful to you. We intend to improve our
evaluation of the whole intelligence process so that we can make re-
source trade-off s and judgments and try to keep the cost of all this down.
Senator STEVENSON. Is the relationship with DOD taking on any
reevaluation now? I ask that because of the concern you have already
expressed about the coordination of all these activities related to
making them efficient, and because civilian control and accountability
to all of the relative agencies of Government, including those of Con-
gress, and let me just throw in another question.
If in the process of collection, analysis, production, and so on,
estimates or analyses are produced that are relevant to policy consid-
erations of committees of Congress, maybe it is the Agricultural Com-
mittee, having to do with low crop conditions, or Interior Committee
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or whatever it is, or the energy jurisdictions; will you make it avail-
able? And by that I don't mean just :make it available. They can be
told about it. That doesn't always happen, but volunteer information
that is relevant to considerations that are going on up here that
aren't necessarily in Armed .Services or in this committee or in Foreign
llelations?
vlr. KNOCIUK. Absolutely, sir. The nature of the requirements
that go in intelligence have changed remarkably over the last couple of
years in recognition of sonic of the things you are tohang about here.
There i s need for improved economic intelligence. It is true that So
percent of the national intelligence resour cess, go into Department of
Defense intelligence programers. I know that there is concern that there
is too much attention. being given to military intelligence problems as
compared to some of the things you are talking about. Under the pro-
visions of the new Executive order, Director Bush is the Chairman for
Foreign Intelligence, which is. a duce-man committee, as you no doubt
know. '1.'he Director of Central Intelligence chairs it, the Deputy
Secretary of Defense, Robert Ell,o,vortlr, and Deputy 1' ssistant to the
.['resident for National Security- Affair;,, William Hyland are the other
members. This is largely a resource allocating committee, and its
decisions must be based on judgments as to what kind of intelligence
needs are going to be met. As tie need for economic needs grows, the
collection and the investment in intelligence machinery will. reflect
that. IJndeer this arrangement the Committee for Foreign Intel ligence,
with the Director as the Chairman, there is a much better chance of
insuring that we get the kind of responsiveness that we need to meet
tare kinds of concern that you describe.
Senator STEVENSON. Well, I certainly don't mean to denigrate the
military or the Navy Department for wanting strictly military con-
sideration,,,. What I am suggesting is that that is not enough, and I am
glad that 3 ou agree.
Mr. KNOC}zn. I agree, certainly, sir.
Senator STEvENSON. Thank you, Mr. Chairman, sir.
Senator BAYi. Senator Morgan?
Senator N OInCAN'. Mr. Chairman, I have just it word or two.
I would say, Mr. Knoche, that I have read your resumes, I heard
,you in the executive session, and l believe we worked for the last 15
months or so rather closely, and 3 find you extremely and. uniquely
well qualified. I have not reread your testimony from the Church com-
mittee, but my recollection. from hearing you during that period of
time is that you were candid. and forthright with the committee, and
I have no reason to believe otherwise.
I have only a couple of questions to ask you. As you know, during
the Church committee hearings there was evidence over a period 0"I'
time that we had engaged in. this country in attempted assassinations,
if not assassinations. Do you believe that in peacetime there is ever
any occasion for this country or any of its agencies to engage in
political assassination?
Mr. KNOCIIE. No, sir; I do not.
Senator 1 OR AN. Do you believe in peacetime there will over arise
an occasion in which it would be proper and. expedient for any agency
of our Government to engage in any kind of assassination, whether
political or otherwise?
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14
Mr. K.NoCHE. The use of your word "ever" is a very big one. I
don't want to appear to be debating with you on that. 1 just want to
he just as forthright answering you on that question. I would want
to leave some room..[ would think, of conceiving of some circum-
stances under whh:li at least the contingency might be discussed, but
it is only the use of the word "ever" that gives me a problem in
answering the question.
Senator MORGAN. You say the contingency may be discussed or
might be discussed. What might that be?
Mr. KNOCHE. Let me try to answer the question this way, and I
;sm going to talk from the heart here, not as a bureaucratic official.
I can conceive of circumstances where we might be asked to consider
that. I can conceive of no circumstances under which I would want
to recommend assassination as a solution to any particular problem
in peacetime, but I think 1. am having trouble with the concept of
never considering.
Senator MORGAN. Maybe the possibility of considering it might
not be eliminated, but let me say I realize it is a difficult question,
and at times you nnay have to take into consideration the conse-
quences of the failure to consider, but I would say, I think I express
the sentiments of most of the American people, when I say that I
don't believe that we should ever engage in assassination of any kind
during peacetime. 1. heard your discussion with regard to covert
activity, and it is it difficult area.
Mr. KNocHE. Yes, sir.
Senator Mox,GAN. I have previously, prior to coming to the Senate,
expressed my own personal views that we in this country should not
engage in covert activity in peacetime in order to influence the direc-
tion of some other government, and yet I have to say from time to
time through the last, 15 months that I find myself wavering on this
position. As I listen to your testimony I waver again, but I do think
that is it question that this committee and this Congress and the
American people are going to have to come to grips with.
Now, in connections with these two---
Mr. KNOCHE. Well, Senator, would you yield for just one moment
on covert action? 1 think it might be helpful to point out to this
committee that the kinds of concerns, Senator Morgan, that you
have just expressed about covert action, have had their impact on
this Government of ours, and the occasions on which it resorts to
covert action. There was a time, back in the height of the cold war,
in the inid-1950's, when well over half of the CIA annual budget
went into covert action activities. Right now in the 1977 budget,
less than 2 percent of the budget goes into covert action activity. I
think as we move farther away from the frigidity of the cold war and
into it new kind of environment in this country, the legitimate con-
cerns of the kinds that you have just expressed are having an effect
on this whole situation. The occasions on which this Government
tasks the CIA to resort to covert action have, for the reasons I have
described, dropped dramatically over a period of 25 years.
Senator MORGAN. I think, Mr. Knoche, those occasions when it
was felt that we now must resort to covert activities should be dis-
cussed, but probably more properly in executive session so I won't
pursue that this morning, except to say that I am sure that there will
be times when you as Deputy Director will be called upon or informed
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of acts which may technically be in compliance with the law but which
may not be in keeping with the spirit of the law. Would you feel free,
in your present situation, to inform this committee of such acts, even
though you are working for Mr. Bush and the President?
Mr. KNOCHE. Yes, sir, I would. I would not only feel free, I would
feel, as I pointed out in my opening statement, I would feel very much
a part of the accountability that I feel in this position.
Senator MORGAN. Accountability, I really think, Mr. Knoche, is
the word, because you are a Presidential appointee, but you are also
required to be confirmed by the Senate, and I think because of this, it
places a greater responsibility on you to account to the Congress than
there would if you were just an employee of the Agency. And for
that reason, if it came to your attention that activities were being
carried out which you felt were not proper or were not in the spirit of
the law, even if they were in keeping with the letter of the law, would
you come to this committee notwithstanding the fact that it might
place you in a difficult position with your immediate superiors?
Mr. KNOCHE. Yes, sir, I would. I presume, Senator, that what you
are asking me is whether I would come to the committee under c,ircurn-
stances under which I have been directed to do something that h
thought was improper. I would like to answer that in a little more
detail, if that is your question.
Senator MORGAN. That is the point I am trying to get at.
Mr. KNOCHE. If f were directed to do something which I thought
was either improper or illegal, I would go the last mile in trying to
dissuade the higher authority that was asking me to do that, and ask
them to retract the order or directive. If I were unsuccessful in doing
that, I would have a difficult choice to make as to whether to resign,
whether to go public, or whether to take my concerns quietly to a
committee of this kind. One of those three things I would have to do,
clearly, and. I would have to judge the circumstances that obtained at
the time.
Senator MORGAN. Mr. Knoche, wouldn't the proper choice in a
situation such as that include coming to a committee of the Congress?
I say that for this reason. I realize that this sort of thing is rouiewhat
contrary to the American management system, but it is also a part of
our system of checks and balances in this Government, and T feel a
man who is being placed in your position of responsibility sometime
might be called upon to do things that it would just take guts to do,
but you just have to accept the responsibility and do it.
Mr. KNOCHE. If it were totally improper in my judgment, or illegal,
and. I was unable to dissuade higher authority from ordering it, T would
come to a committee of this kind, I feel quite confident. Where I have
to begin debating this a little bit in my mind is the instances where
there is room for doubt as to whether that higher authority is on good
ground-you know, it could he simply a difference of opinion--
and whether I would want to make a cause celebre out of something
of that kind.
Senator MORGAN. Well, I agree with you, and I certainly don't
want to encourage what might be called by some insubordination, but
l do think that is a major activity that is a part of our system of
accountability that you ought to come to us.
Mr. KNOCHE. I have no difficulty with that.
Senator MORGAN. One more question. Are you satisfied with the
system that places the responsibility for internal security on the
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Federal Bureau of Investigation and other law enforcement agencies
rather than the Central Intelligence Agency?
Mr. KNocnE. Yes, sir, I am. That is not to say that I know at all
whether that is being carried out effectively by the Bureau, but I
believe all of us would agree, after the reviews and investigations that
have takers place in the last year or 1S months, that there is not a
proper role for domestic intelligence activities in the hands of an
agency which is also responsible for external intelligence activities,
and I believe there is wisdom in going back to the checks and balances,
or there is wisdom, and to make sure that those two functions are
separate. But one has to be sure that in the relationships between the
FBI with its responsibility for domestic security, and the CIA, with its
responsibility for counterintelligence abroad, there is a good and
fruitful and constructive relationship between the departments.
Senator MOROAN. I agree with you on that, and both of us will
recall there was a period of time in which there was no liaison for
practical purposes between the two agencies. Are you satisfied now
with the cooperation and coordination between the two agencies?
Mr. KNooHE. Yes, and I haven't, because I haven't, of course,
participated in this job, I haven't been directly involved in that
relationship, so I can't speak to it first hand. But there have been
several meetings between Director Kelley and Director Bush, and
either--Director Bush of course has been in office only since around
the turn of the year. They have met two or three times, and the
relationship at the working level is restored, and as far as I can see,
Senator Morgan, it is effective, and I intend to keep it so.
Senator MORGAN. N11'. Chairman, I11 conclude by snaking one
comment. I believe that Congress and the American people entrust
you and the CIA with the resources and capabilities for dealing with
foreign intelligence, that we would not entrust to you if we had any
thoughts that such capability would be used domestically against;
American citizens. So I just want to say to you that I share your view
wholeheartedly that. the CIA has no role for domestic intelligence
except that: of liaison and coordination.
Thank you, Mr. Chairman.
1\'11'. KNOCIIE. Yes, sir.
Senator BAY IT. Then, if there are no further questions, then I would
ask the witness if he has any objection to our submitting certain
questions for the record that could be answered after the hearing is
t ernunated.
I understand the Senator from North Carolina expressed his
support, for the nominee, and so since there are none other present,
ou are home free here, Mr. Knoche.
1 would like to point out that we have 12 votes registered in support.
I am going to ask, if there are no objections, that we poll the remaining
members of the committee, and ask that the final vote be posted at
the end of the day when the other members have been reached.
And I add my congratulations once again for your responsibilities,
congratulations as well as it bit of sympathy because it is not going to
be an easy task.
If these are. no further comments at this time, we will adjourn the
nomination hearings.
Mr. KNOCBE. Senator Bayh, Senator Morgan, thank you very
much.
[Whereupon, at 10:49 a.m., the committee recessed subject to the call
of the Chair.]
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P IIOVISIONS OF EXECUTIVE ORDER 14905 ESTABLISHING A DEPUTY DIRECTOR OF
Cr NTR.:1L INTELLIGENCE
SE(". 3. CONTROL AND DIRECTION OF NATIONAL INTELLIGENCE ORGANIZATIONS
(d) Director of jeotral Intelligencc.
(2) To assist the Director of Central Intelligence in the supervision and direction
of the Intelligence Comnuinity, the position of Deputy to the Director of Central
Intelligence for the Intelligence Community is hereby established (Committee on
Foreign Intelligence.)
(3) To assist the Director of Central. Intelligence in the supervision and direction
of the Central Intelligence Agency, the Director of Central Intelligence shall to the
extent consistent with his statutory responsibilities, delegate the day-to-day
operation of the Central Intelligence Agency to the Deputy Director of Central
Intelligence (.50 U.S.C. 403(a)).
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 Approved For Rp1q ,2Q;Q J1a qJA7WPA1' OOO6OOO1OOO2-2
Name (Including any former names used) : Knoche, Enno Henry.
Position to which nominated: Deputy Director of Central Intelligence. Date of
nomination: April 22, 1976.
Date of Birth: January 14, 1925. Place of birth: Charleston, W. Va.
Marital Status: Married. Full name of spouse (including any former names
used by spouse) : Angie Papoulas Knoche.
Names and Ages of Children: John Ilenry Knoche, 26; Randall J. Knoche 24;
Peter D. Knoche, 22; Christopher C. Knoche, 18; and Jeffrey A. Knoche, 18.
Education: Washington and Jefferson, Washington, Pa., 1942 (1946), 1943
(1947), AB in 1947; Bethany College, Bethany, W. Va., 1943-44; Akron, Ohio
and Pittsburgh, Pa. November 1948 to February 1951 studied Russian language;
U.S. Naval 'School, Oriental language, Colorado University 1945-46, Chinese
language (Foochow dialect); Federal Executive Institute, University of Virginia,
1968.
Honors and Awards: Military medals--American Defense theatre, Victory
Medal, Korea, Pacific Theatre.
Memberships: MALTA-Mid-Atlantic Lawn Tennis Association, vice president,
men's activities 1974 to present; Westwood Country Club, Vienna, Va., 1975 to
present.
Published Writings : Served several months in 1948-49 as a management trainee
in Public Relations Department of the Goodyear Tire Co. in Akron, Ohio. Issued
several releases to the press services covering various matters reflecting develop-
ments within the Company and helped edit and publish Good Year's house organ,
a weekly newspaper.
Political Affiliations and Activities: Have contributed annually in the amount
of $15 to one of the national political parties. No other contributions or services
have been rendered to political parties or election committees.
Qualifications: State fully your qualifications to serve in the position to which
you have been named. (Attach sheet).
Future Employment Relationships:
1. Indicate whether you will sever all connections with your present employer,
business firm, association or organization if you are confirmed by the Senate.
(Not applicable.)
2. As far as can be foreseen, state whether you have any plans after completing
government service to resume employment, affiliation or practice with your pre-
vious employer, business firm, association or organization. (Not applicable.)
3. Has anybody made you a commitment to a job after you leave government?
No.
4. Do you -:expect to serve the full term for which you have been appointed?
No term is provided, it being at the pleasure of the President. -I have no plans
regarding departure.
Potential Conflicts of Interest:
1. Describe any financial arrangements or deferred compensation agreements or
other continuing dealings with business associates, clients or customers who will
be affected by policies which you will influence in the position to which you have
been nominated.
None. Upon nomination to the position, I sold my entire holding of limited
amounts (loss than $5,000) in various common stock.
2. List any investments, obligations, liabilities, or other relationships which
might involve potential conflicts of interest with the position to which you have
been nominated. None.
3. Describe any business relationship, dealing or financial transaction (other
than taxpaying) which you have had during the last 10 years with the Federal
Government, whether for yourself, on behalf of a client, or acting as an agent,
that might in any way constitute or result in a possible conflict of interest with the
position to which you have been nominated.
None. I have spent all of the past 10 years as a federal government employee.
4.-List any lobbying activity during the past 10 years in which you have engaged
for the purpose of directly or indirectly influencing the passage, defeat or modifica=
tion of any legislation at the national level of government or affecting the adminis-
tration and execution of national law or public policy. List specifically any anncar-
ance before any committee ofthe Congress.
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I have never engaged in any lobbying activity. I have appeared before Con-
gressional committees in connection with CIA activities.
5. Explain how you will resolve any potential conflict of interest that may be
disclosed by your responses to the above items.
I can see no conflict. I have placed the proceeds of common Stock sales in mutual
funds.
Employment Record: From July 1943 to August 1946 Mr. Knoche entered the
Navy as an apprentice seaman, assigned to the college V-12 program and school
at Bethany College, Bethany, West Virginia for one year. After four subsequent
months at the USNR Midshipman's school at Columbia, was commissioned as an
Ensign in December 1944 and assigned to the study of Chinese (Foochow dialect)
at Colorado University. After completing the course in June 1946, was ordered
to duty at the Naval Communications Annex, Nebraska Avenue, Washington,
D.C. was released from active duty a short while thereafter.
From August 1947 to November 1947 Mr. Knoche was employed by the E.A.
Knoche, Co., Inc., 1411 Keystone Building, Pittsburgh, Pa. His duties included
determining the amount of loss to an insured person and arranging for his com-
pensation in accordance with the terms of the appropriate insurance policy.
From November 1917 to July 1949 Mr. Knoche was employed by the Goodyear
Tire & Rubber Co., 1411 East Market Street, Akron, Ohio. During this period,
Mr. Knoche served as a management trainee. The first year of employment was
spent in actual production work supervising and learning the various phases of the
preparation and manufacture of the company's products, time thereafter was
spent as a trainee for staff capacity with virtually exclusive emphasis placed on
the public relations and sales promotion fields.
From July 1949 to February 1951 Mr. Knoche worked for the E. A. Knoche,
Co., Inc. as an insurance adjuster. His duties included the same as during the
period August '47 to November '47. During this time he also served as an assistant
secretary for Knock-A-Bar, Inc., 1411 Keystone Building, Pittsburgh, Pa., a small
industrial research organization. His duties included maintaining files and records,
purchasing materials and supplies, acting as the company's official agent in the
sale of stock, etc., all in connection with a chemical research organization.
From 22 February 1951 to February 1953 Mr. Knoche was employed by the
National Security Agency, 4300 Arlington Boulevard, Arlington, Va. Mr. Knoche
served as a Section Chief supervising the efforts of 125 employees, both civilian
and military, constituting an operational section. His supervisory responsibilities
were both of an operational and administrative nature. Ile remained in NSA
employ as a civilian from February to November 1.953.
Mr. Knoche joined the Central Intelligence Agency in 1953, and served in the
Office of Current Intelligence (OCI) until 1962. His initial assignment was as an
analyst following Chinese military developments. In 1956 and 1957 he was OCI's
focal point for handling U-2 coverage requirements and for disseminating [7-2
products to OCI components. In 1958 Knoche was named one of OCI's Senior
Intelligence Duty Officers. This assignment included the following responsibilities:
senior officer on duty in the Agency's round-the-clock Watch Office, secretary of
an inter-Agency panel producing daily intelligence summaries for the President
and his advisers, and preparing briefings for the Director to give to periodic meet-
ings of the National Security Council.
In 1962 Knoche was named Special Assistant to the Director and Deputy
Director of Central Intelligence, and served in this position until 1967, when he
was assigned as Executive Director of the National Photographic Interpretation
Center-a joint CIA-Defense Department unit. In 1969 Knoche was named
Deputy Director of CIA's planning and budgeting activities, and in this post,
served as Chairman of a CIA Committee charged with setting policy for auto-
matic data processing and information handling. A year later he became Deputy
Director of the Office of Current Intelligence.
From 1972 .onward Knoche served as Director of various Agency components,
including the Intelligence Directorate's Office of Strategic Research, the analytical
component charged with evaluating foreign military developments, particularly
those that relate to the strategic threat against the U.S.
At the outset of 1975, during inquiries into American intelligence activities by
the Rockefeller Presidential Commission and Select Senate and House Commit-
tees, he served as Special Assistant to the Director of Central Intelligence in
liaison with those conducting the inquiries.
In the fall of 1975, Knoche was named Associate Deputy to the DCI, the #2
position in the Director's staff involved in the coordination and management of
the resources of the U.S. Intelligence Community, including CIA, Defense, and
State Department elements.
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E. H. KNOCHE RESPONSES TO JUNE 24, 1976 WRITTEN INTERROGATORIES
SUBMITTED BY THE SENATE SELECT COMMITTEE ON INTELLIGENCE
I. THE NATURE AND EXECUTION OF THE DDCI'S RESPONSIBILITIES
Question A. Have you worked out a formal arrangement with Mr. Bush on the-
specific nature of your responsibilities? What subjects relative to the Agency's.
administration will require his attention more than yours? How would you define
your day-to-day responsibilities beyond the general definition outlined in the
President's Executive Order 11905?
Answer. Director Bush and I are in the process of defining arrangements per-
taining to his role as executive head of the CIA and the Deputy's role in day-to-
day operation of the Agency. The responsibility in the latter regard, as stated in
Executive Order 11905, is a new one with no firm precedent. The intent of the
Executive Order is clear, however. The Director, as head of the CIA, coordinator
of the Intelligence Community, intelligence adviser to the President, and producer
of national intelligence, must be freed of administrative details to plan for and
work on these important responsibilities. I will assume the administrative, oper-
ating tasks of CIA and carry out such other responsibilities as may be delegated
to me by the Director. In dealing in Agency matters, I will be working also with
the Deputy for the Intelligence Community. The two Deputies, as subordinates
of the DCI, will work closely together to assist the DCI in accomplishing what is
required. In due course, new legislation covering the Deputy for the Intelligence
Community will be proposed for congressional approval. Meanwhile, any formal
delineation of duties among the DCI and his two Deputies will be made after we
have had the benefit of additional experience. It is clear, however, that I will be
responsible for developing Agency programs, plans, and budgets, and for ensuring
the balance of resource allocations to meet assigned tasks.
Question B. in previous testimony to this Committee, Director Bush stated that
he would not give up his own management responsibilities within the Agency.
How do,you interpret this and what effect will it have on your duties?
. Answer. The Director of Central Intelligence is responsible for the production
of national intelligence to satisfy the needs of the President and his advisers in
the National Security Council. he DCI is also the coordinator of the Intelligence
Community and chairs the Committee on Foreign Intelligence, making resource
decisions concerning the National Foreign Intelligence Program. To accomplish
these tasks, the DCI must have the authority and expertise that flows to him
from the Central Intelligence Agency, and the DCI will frequently be the final
authority on key management issues within the Agency. To out himself off from
the CIA would inhibit if not prevent, the DCI from fulfilling his responsibilities.
As his Deputy in the Agency, I will have clearly in mind the Director's primacy;
I will, however, seek to free him of these burdens of day-to-day, administrative
detail, and will otherwise assist in ensuring that the functions and products of
CIA are responsive to DCI needs and concerns.
Question C. A recurring problem for successive DCI's has been the amount of
time absorbed by clandestine operations. The nature of the operations and the
fact that they involve people in sensitive situations, demanded the involvement
of the Agency's senior official. Will you assume some or most of the DCI's re-
sponsibilities in this area?
Answer. Yes, I will doubtless assume some DCI responsibilities in overseeing
and managing clandestine activities and in seeing that they are both effective
and proper. Many of these activities are of high-level interest and sensitivity, and
the DCI will continue to have a responsibility and concern for them.
Question. D. Executive Order 11905 states that the DCI "shall act as principal
spokesman to the Congress for the Intelligence Community . " Given the
redefinition of the DDCI's responsibilities, will you assume some of the responsi-
bilities for congressional briefings? If so, in what area?
Answer. Yes, there are areas in which I am likely to assume a share of responsi-
bility for congressional briefings. I will probably present the details of CIA budgets,
programs, and plans. In the absence of the DCI, I will very likely also provide
substantive.intelligence briefings. The Director wants to keep very close contact
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with Congress, but there are many invitations to appear, and he expects me to be
available for certain congressional briefings.
Question E. Do you have long-term objectives you wish to implement? What
are they?
Answer.I do have long-term objectives. Among the most important are:
Improvement of intelligence analysis and production to make the product as
comprehensive, timely, and useful as possible. .
Improvement of innovative research and development of new intelligence
techniques and equipment for the collection, processing, analysis, and production
of intelligence information.
Development of improved methods to evaluate the priorities of intelligence
requirements and to assess the performance of all phases of intelligence in order
to make better judgments on where to apply resources.
II. CIA BUDGET PROCEDURES
Question A. Contingency Reserve Fund.-The CIA has a substantial Contingency
Reserve Fund which was designed to be used to fund CIA activities which could
not be anticipated. In the past, however, money has been drawn from the Fund for
the support of multi-year major covert actions, the continuance of which were
anticipatable. Congress is not informed in advance of proposals to draw money
from the Contingency Reserve Fund even though the projects to be supported
by such funds have been in the planning stage for months. Congress is notified
,only after the draw-down: in contrast OMB approval must be obtained before,
hand. Given the requirement of S. Res. 400 that this Committee be informed
of signiticant anticipated activities will you notify the Committee, in advance,
of proposals to draw funds from the Contingency Reserve Fund?
Answer. The Reserve for Contingencies was established in 1951 in recognition
of the fact that CIA must have an alternative to seeking supplementary appropria-
tions. The supplementary appropriations procedures are clearly unsatisfactory for
CIA, in light of the speed and secrecy with which the Agency may have to expend
funds. The Reserve is not a fund used exclusively for covert action activity; it
also is used to meet unbudgeted requirements which essentially are administrative
in nature. Last year we began a new procedure for notifying Congress of proposals
to draw funds from the Contingency Reserve. At the time a request for approval
of a release is submitted to OMB, we notify our oversight committees of the
proposal. I have instructed that the Senate Select Committee be added to the list
of recipients of these letters.
Question B. Reprograming Funds.-There are few limits on the DCI's authority
to reprogram funds provided to the CIA, even though the heads of other depart-
ments, such as DOD, are limited in this area. Would you agree to notify the Com-
mittee of any reprograming decision involving over $250,000 within 48 hours of
the decision?
Answer. Last year, in considering our 1976 budget request, the Committee on
Appropriations of the House of Representatives placed restrictions on repro-
graming which were subsequently endorsed by the Senate/House conferees.
We have been following the reprograming guidelines for nearly a year and will
continue to do so. In addition, the President has prescribed in Executive Order
11905 that the Committee on Foreign Intelligence establish reprograming
guidelines. These guidelines are still under development. I believe it would be
inadvisable to agree to any new reporting arrangements pending the completion
of the review of the subject by the CFI. It is my hope that the Agency can meet
the needs of all our oversight committees regarding reprograming notification
with a single set of guidelines satisfactory to all. Different sets of guidelines would
be confusing and would impose a considerable and unnecessary burden of work.
Question C. Advances and Transfers.-The CIA now spends approximately 70
percent more than it is provided directly by Congress. This extra money comes
mainly in the form of advances and transfers from other Governmental agencies.
The predecessor committee found that these advances and transfers are not pre-
sented in the CIA's budget submission in a form which makes clear their impact.
Will you and your staff work with the Select Committee's staff to construct a
format which will make this flow of funds more visible in future budget sub-
missions?
Answer. In recent years this information has always been included in our
Congressional Budget Submission. Our 1977 Congressional Budget Request,
which the predecessor committee did not review, includes a complete and explicit
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display of data about advances and transfers from, as well as to, other Govern-
ment agencies. We believe this format will satisfy the interests of-the.Committee.
If further adjustments are required, we will of course work with our oversight
committees to satisfy their needs. Again, however, it is my hope that a single
format will be acceptable to all our committees.
Question Cl. Advances and transfers are clearly shown in the Agency's
annual financial report which until last year did not go to Congress. Will this
report be provided annually to, this Committee?
. Answer. If the Committee would. like to receive the annual financial report each
year, we would,be pleased to provide it.
Question D. Spending Projections.-Under the Budget Act, agencies are required
to provide five-year projections of spending. During the past.year, the CIA made
available OMB's lump sum projections for the Agency's budget for the next
several years. The lump sums apparently did not reflect inflation. They did not
show the effect of the funding level on the Agency's ability to accomplish its
mission. No options were presented. Will you provide the Committee with detailed
long-term budget plans showing options for the Agency, the effects of varying
levels of funding on the accomplishment of the Agency's mission, and the impact
of present budget commitments on future Agency spending?
Answer. Our budget projections are prepared in accordance with instructions
issued, by O-MB, which are intended to maintain a. certain level of consistency
among projections developed by all-Executive departments and agencies. Deviation
from those instructions could create some confusion in the budgetary process. If
the Committee wishes to discuss program options, I am prepared-to do so.
Question E. CIA Proprietaries.-The financial impact of CIA proprietaries has
not until this past year been reflected in the Agency budget submission. Will you
provide a clear statement of the financial impact of CIA proprietaries in upcoming
budget subbiissions? Will you provide, as the predecessor committee recom-
mended, an annual report on proprietaries?
Answer. Our 1977 budget request included financial information about CIA
proprietaries. We will include in our 1978 request a more detailed presentation,
which I hope will satisfy the needs of the Committee for information on CIA
proprietaries, and may make an annual report on proprietaries superfluous. If it
does not meet the Committee's needs, we will be happy to work further with the
Committee on this subject.
Question A. Rank of the General Counsel.-The General Counsel now ranks
below the Deputy Directors and below the Inspector General. In order to guarantee
the General Counsel's independence, would you recommend a promotion to the
same level as the Deputy Directors and the Inspector General?
Answer. Yes.
Question 11. Misuse of Secret Information.-It has been suggested that CIA
employees having access to secret intelligence might misuse that information to
personally profit from their position of trust. You have informed this Committee
about steps taken in this regard with respect to senior management who are in
a position to award contracts. What steps have been taken with respect to other
CIA employees who have access to confidential information such as economic
intelligence?
Answer. A number of Executive branch and Agency directives deal with actual
or apparent conflict of interest situations. Section 203 of Executive Order 11222
(effective 11 May 1.965), for example, states in part:
SEC. 203. "Employees may not (a) have direct or indirect financial interests
that conflict substantially, or appear to conflict substantially, with their responsi-
bilities and duties as Federal employees, or (b) engage in, directly or indirectly,
financial transactions as a result of, or primarily relying upon, information
obtained through their employment."
This section would certainly cover CIA employees who have access to confi-
dential economic intelligence.
CIA regulation IIR 20--6e implements E.O. 11222 and Civil Service Regulations
conflict of interest, dated 9 June 1967. 1111 20-6c requires financial interest state-
ments to be filed by a broader class of employees than just those in a position to
award contracts. In addition, employees at the GS-13 or above level must file if
they are involved in administering or monitoring grants or subsidies, regulating
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24
or auditing private or other.non-Federal enterprise, or if they are involved in any
other action or decision which has an economic impact on any non-Federal
enterprise.
Question C. Should the General Counsel and Inspector General be assured, by
statute, of access to all Agency information necessary for their work? Will you
notify this Committee if either of these officers is denied access to CIA information
they request?
Answer. Section 6(c) (3) of Executive Order 11905 directs heads of intelligence
agencies or departments to: "Ensure that Inspectors General and General Counsels.
of their agencies have access to any information necessary to perform their
duties ...'
Agency regulations HR 1-3 a and b require that the Inspector General and.
General Counsel have access to all information necessary for the performance of
their respective duties. In my view these firm requirements make a statute
requiring access completely superfluous. I share the Committee's interest in
guaranteeing these officials access to information they require for the performance
of their duties. Because of the access requirements of E.O. 11905 and Agency
regulations, I do not anticipate that either of these officers will be denied informa-
tion they need.
Question A. If analysts are unwitting of covert actions it would seem that.
the quality and relevance of the intelligence analysis is affected. Should analysts
be a part of the covert action approval process?
Answer. Yes. As a general rule, I believe that analysts must have knowledge
of covert action in their area of expertise. This serves two important purposes.
First, it gives the planners of a covert action an expert independent judgment of
the potential effect of a proposed covert action. Second, the analyst can thus-
more accurately assess the forces at work in a particular country, and the strengths
of these forces.
Question B. In his testimony before the predecessor committee, John Huizenga
described a "natural tension" between intelligence analysis and policy which can
often result in the product of the analysts going unused. IN hat relationship
should exist between the analysts and the policymakers in order that the intel-
ligence product is both useful and useable?
Answer. The intelligence analyst and policymaker have distinct roles and
functions, and I believe a certain detachment between the two should be main-
tained. The analyst has an obligation to the policymaker to be as objective and
forthcoming as possible in providing his assessments of world situations. The
policymaker can choose to accept or reject that assessment, but if he has given
the intelligence judgment substantial consideration in his policy review, he will
have fulfilled his obligation to the'analyst.
Question C. The predecessor committee noted the severe pressures which could
be directed toward the DCI to make him alter his intelligence judgments. What
organizational mechanisms would you recommend to protect the independence
and integrity of these judgments?
Answer. Experience has shown that organizational mechanisms are not the
only answer to potential pressures. Rather, the solution lies in the employment
of men or women with integrity and dedication to objectivity. The hallmark of
intelligence must be its independence and pressures to alter intelligence judgments,
for political reasons must be withstood.
Question A. Are you willing to appear and testify before any duly constituted
committee of the Congress on such occasions as you may be reasonably requested
to do so?
Answer. Yes.
Question B. Are you willing to provide such information as is requested by such.
committees?
Answer. Yes.
Question A. Have you ever been convicted (including pleas of guilty or nolo
contendere) of any criminal violation other than a minor traffic offense?
Answer. No.
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Question B. Please advise the Committee of any additional information, favor-
able or unfavorable, which you feel should be considered in connection with your
nomination.
Question C. Please provide the Committee with the names and current addresses
.of five individuals whom you believe are in a position to comment upon your
qualifications for the office to which you have been nominated.
Answer. (1) Col. L. K. White (Home) New Piasa, Chatauqua, Elsah, 111.
82028; (2) David W. Belin (Office), Herrici, Langdon, Belin Harris, Langdon &
Helmick, 2000 Financial Center, Seventh and Walnut, Des Moines, Iowa 50309,
David W. Belin (Home), 1705 Plaza Circle, Des Moines, Iowa 50322; (3) Timothy
:S. Hardy (Home), 5781 Rayburn Avenue, Apt. 162, Alexandria, Va. 22311;
(4) Lt. Gen. Samuel V. Wilson (Home), Quarters 59, Fort Belvoir, Va. 22060;
,(5) Mr. Arthur C. Lundahl (Home), Route 1-Box 445A, Augusta, Mich. 49012.
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E. II. KNOCIJE: RESPONSES TO ADDITIONAL INTERROGATORIES SUBMITTED BY
SENATOR GARY HART
Question A. The predecessor committee recommended that the 1947 National`
Security Act be rewritten. Do you agree that this needs to.be done?
Do you think the new legislation should include charters for the organizations
and entities which make up the U.S. intelligence community, including the CIA?
. Do you believe the new legislation should contain specific and clearly defined
prohibitions or limitations on certain intelligence activities carried out by our
intelligence agencies, including the CIA?
With respect to the CIA, what prohibitions or limitations should be contained
in a new version of the 1947 National Security Act?
Will you, as DDCI, assist this Committee in writing this now legislation?
Answer. The National. Security Act of 1947 is. by now in need of substantial
revision. I am concerned, however, that in our zeal to bring the Act up to date,
we leave sufficient flexibility for the Executive to deal with future unforeseen
problems, such as the growing threat of international terrorism. Thus, questions.
such as whether charters for all intelligence entities should be included in the
Act, and whether specific prohibitions should be included and what they might be,
deserve the most careful consideration. I pledge the cooperation of the CIA,
with the Committee in studying and arriving at decisions on these important
questions.
II. COVERT ACTION
Question A. Since 1961 the CIA has conducted some 900 major or sensitive covert
action projects plus several thousand smaller ones. In light of this, would you
agree that, over the years, covert action has become a frequently used tool of
U.S. foreign policy? Do you believe this was the intention of the framers of the
1.947 National Security Act, or was covert action originally intended to be an
exceptional tool, used only under extraordinary circumstances? Would you agree
that covert action should only be used to deal with grave threats to American
security?
Answer. The statistics on the use of covert action as an instrument of U.S.
Government policy, if examined closely, would demonstrate two things: first, that
the need to have recourse to this form of action has been dictated by the circum-
stances of the world in which we live and the dangers which we confront; and
second, that it is necessary, in order to have such capability available in time. of
need, to maintain an infrastructure which can be called into play as required. This
kind of resource cannot be created on short notice.
In this context, I would merely observe that the frequency of covert action
projects has varied greatly between, for example, the years when the U.S. was
confronting worldwide communist expansion in the 1950's and more localized
communist insurgencies in the 1960's, and the current period in which American
perceptions of world events have reduced covert action to an exceedingly low
level. The legislative history of the former Act may not make clear how often the
framers intended that it be used. However, I believe it likely, given the then-recent
successful history of the OSS and the general international atmosphere of the late
1940's, that the framers intended covert action to be used whenever policymakers
felt that world events so dictated.
Regarding a standard for the use of covert action, the standard in section 662 of
the Foreign Assistance Act, that an operation must be "important to the national
security," is a more flexible and appropriate standard than, permitting its use only
in response to "grave threats to American security."
Question B. The predecessor committee recommended, following its investigation
of alleged assassination plots, a statute to prohibit such activities. In addition, the
committee recommended a statute to prohibit efforts to subvert democratic
governments and support for olice or other internal security forces which engage
in the systematic violation of human rights. Do you believe these prohibitions are
necessary and can you support them?
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Answer. During my confirmation hearings, I stated that I did not believe that in
-peacetime there would ever be any occasion for this country to engage in political
assassinations. Section 5(g) of E.O. 11905 prohibits employees of the United
States Government from engaging in political assassination. In addition, the
President has publicly stated that he will support legislation making it a crime to
assassinate or attempt to conspire to assassinate a foreign official during peacetime.
I share your uneasiness about the propriety of efforts, covert or otherwise, by
any external force to "subvert" governments which have come into being by
democratic processes and which continue to function as independent democratic
governments. Definitional problems could make a statutory prohibition, such as
is suggested, very difficult to enforce.
Support for police or other internal security forces which engage in the system-
.atio violation of human rights should be subject to stringent review, rather
than prohibited by statute. American intelligence, from time to time, in dealing
with important matters such as counterintelligence, anti-terrorism, and the
narcotics problem, must deal with foreign security forces whose records on human
rights may not be admirable.
Question C. The predecessor committee found that a majority of covert action
projects-those that are considered low risk or low cost-can be approved within
the CIA. Do you believe, as did the predecessor committee, that all covert action
projects, whether high or low risk, should be reviewed by the appropriate National
Security Council subcommittee?
Answer. Covert action of any type should be reviewed by the Operations Advi-
sory Group, the National Security Council body established by E.O. 11905 for
this purpose. Each major covert action proposal is individually reviewed by this
group of senior Government officials. I also favor review, in the aggregate by
the OAG, of lesser covert action undertakings, including the covert action infra-
structure mentioned above, as recommended by the predecessor committee.
Question D. The predecessor committee strongly recommended that this commit-
tee should be informed of all major or significant covert operations prior to their
initiation. What are your views on prior notification or consultation? Also, the
committee recommended that this Committee should be kept fully and currently
informed on all covert action projects and the DCI should submit a semi-annual
report on all such projects to the Committee. Do you agree?
Answer. The question of a requirement of prior notification of covert action
presents at least serious practical problems. I believe the arrangements worked
out to provide the committees the timely notice now required by statute allow
opportunity for the informed committees to consult with the Executive on specific
programs. Regarding a semi-annual report on covert action, I want to work closely
with the new Committee to satisfy its information needs. I am confident that
satisfactory arrangements can be reached with the Committee in this regard.
Question E. Finally, how would you like to see the reporting requirements to
Congress on covert operations, as found in the Hughes-Ryan amendment to the
1974 Foreign Assistance Act, amended or revised?
Answer. I believe it is essential that Congress concentrate intelligence oversight
arrangements to the maximum possible extent consistent with effective oversight.
This of course was a driving force behind the creation of the Select Committee.
However, the Hughes-Ryan amendment requirement of reports to so many
committees remains a barrier to concentrated oversight. I would therefore support
a repeal of the Hughes-Ryan amendment. Our congressional oversight committees
-do need to be kept informed of covert action, but the statutory base for such
reporting should more logically and appropriately be a general reporting require-
ment in the National Security Act.
III. CIA RELATIONS WITH U.B. INSTITUTIONS AND PRIVATE CITIZENS
Question A. As you know, the predecessor committee looked into the question of
CIA relations with U.S. institutions-the press, academic and religious institu-
tions-and private citizens. The Committee was concerned that the clandestine
relations might compromise the independence and integrity of these groups and
undermine public confidence In them. What are your thoughts on this matter?
Answer. I share the view that the integrity of U.S. institutions and of American
.citizens as individuals must be preserved. I am equally concerned that Americans
-of all professions maintain the freedom of choice to cooperate with their Govern-
,ment voluntarily and knowingly according to the dictates of their owls conscience.
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I believe the Agency has taken significant steps to strike the proper balance-
between these two considerations. So far as the press and the clergy are concerned,
Director Bush's enunciation of Agency policy on 1.1 February 1976 should dispel
any suspicion which might attach to full-time or part-time members of these
American institutions. In addition, there are stringent, self-imposed limitations
on Agency relationships with American academicians and academic institutions.
Question B. The Committee proposed a number of statutes dealing with these
relationships. In addition, it recommended that the CIA amend its internal
guidelines to take care of some specific concerns of the Committee. For example,
with respect to CIA relations with academic institutions, the Committee recom-
mended that the CIA amend its internal regulations to require that individual
academics used for operational purposes, together with the President or appropriate
university official, be informed of the clandestine CIA relationship. Has the Agency
considered this recommendation and does it plan to implement it?
Answer. I am in full agreement with current Agency practice which requires that
individual members of the academic community be made aware that they are
dealing with CIA before being asked to assist the Agency. I do not agree that the
confidentiality of such voluntary and witting relationships should be violated by
informing any other person of them without the understanding and permission of
the individual involved.
Question C. The Committee also recommended that the recently adopted CIA
prohibitions against any paid or contractual relationship between the Agency and
U.S. and foreign journalists accredited to U.S. media organizations be extended to
included the operational use of any person who regularly contributes material to,
or sets policy for, U.S. media organizations. Has this recommendation been
reviewed by the CIA and what position does the Agency take on it?
Answer. Within the terms of the Director's statement of 11 February on rela-
tions with American news-gathering organizations, we accept the recommenda-
tion and we have undertaken measures to comply with it.
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Hon. DANIEL K. INOUYE,
Chairman, Select Committee on Intelligence,
U.S. Senate, Washington, D.C.
DEAR MR. CHAIRMAN: In connection with his nomination to be Deputy Direc-
tor of Central Intelligence, Mr. E. H. Knoche has provided me with a list of
securities and other financial assets owned by him, his wife and his minor children.
I have reviewed this list, and, in my opinion, Mr. Knoche's and his family's
financial investments create no conflict of interest for him as the nominee for
the Deputy Director of Central Intelligence.
Sincerely,
ANTHONY A. LAPHAM, General Counsel.
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JUNE 7, 1976
CENTRAL INTELLIGENCE AGENCY,
Washington, D.C., June 7, 1976.
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 Approved For Release 2005/11/28 : CIA-RDP91-00901 R000600010002-2
LETTER TO CHAIRMAN INOUYE FROM E. HENRY KNOCHE, JUNE 7, 1970
CENTRAL INTELLIGENCE AGENCY,
Washington, D.C., June 7, 1976.
lion. DANIEL K. INOUYE,
Chairman, Select Committee on Intelligence,
U.S. Senate, Washington, D.C.
DEAR MR. CHAIRMAN: In connection with my nomination as Deputy Director
of Central Intelligence, I herewith furnish information concerning my employment,
financial interests, and organizational affiliations.
I am a career employee of the Central Intelligence Agency having joined the
Agency as an analyst in 1953. I also served as a naval officer during World War II
and the Korean War, and was briefly with the National Security Agency just
prior to joining CIA in 1953. Between college (1947) and my service with the
Government, I was employed by several private employers in Akron, Ohio, and
Pittsburgh, Pennsylvania. With the Central Intelligence Agency I have held a
number of senior positions, including Executive Director of the National Photo-
graphic Interpretation Center; Deputy Director of Planning and Budgeting; and
Director of Strategic Research. At the onset of the investigations into American
intelligence activities, I was made Special Assistant to the Director of Central
Intelligence with responsibilities for liaison with the Rockefeller Commission and
the Select Committees for the House and Senate. Last fall I was appointed
Associate Deputy to the Director of Central Intelligence for the Intelligence
Community. I have no other employment and do not serve as an officer, director,
or partner of any enterprise operated for profit.
Until recently, I owned shares of common stock in AT&T, General Motors,
Sears Roebuck, General Fireproofing, and First and Merchants National Bank of
Virginia. In order to avoid any possibility of a conflict of interest, or the appearance
of a possible conflict, I have disposed of these stockholdings. In the future, I will
refrain from purchasing stock or acquiring any other financial interest which
would present a possible conflict of interest or the appearance of a conflict.
My wife is a limited partner (six percent interest) in the Papoulas Livestock
Company of Craig, Colorado. She also holds a 25 percent share of certain coal, oil,
gas and mineral rights on a portion of the land (located in Routt and Moffat
counties, Colorado) owned by this company. My wife has a small holding in a
mutual fund. Two of my five children are adults and reside in Colorado. Each of
the three others is a part of my household and has a small savings account.
As a Government employee, I am covered by the Civil Service Retirement
System and I have some social security coverage based on my employment by
private employers prior to my Government service. I also participate in the
Voluntary Investment Program, the retirement investment program sponsored by
the, Central Intelligence Agency for its employees. I hold shares in the Northwest
Federal Credit Union. In addition, I have a small checking account, some United
States savings bonds, certain household goods and personal effects and two
residences in Virginia, both of which are mortgaged.
I am a Vice President of the Middle Atlantic Lawn Tennis Association, a
non-profit organization.
I trust this information satisfies the Committee's needs. I will be glad to furnish
any additional information.
Sincerely,
(33)
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Approved For Release 2005/11/28 : CIA-RDP91-00901 R000600010002-2