organizational issues without objection the chair and ranking member will have five minutes to make opening statements followed by opening statements not to exceed three minutes by any other member seeks recognition without objection members and witnesses may have five legislative days to submit a written statement or extraneous materials for the record the purpose of today's hearing is to examine the loss of an external hard drive containing data from the executive office of the clinton administration we will hear from the acting archiv  the security breach occurred and what steps have been taken and what steps should be taken to tighten security at nara facilities the missing hard drive which is a backup copy contained the entire computer files of one hundred and thirteen white house employees their entire computer files were downloaded and stored on a hard drive and later transferred to the backup hard drive that is now missing classified documents and personally identifiable information of former clinton administration staff and visitors to the white house are now exposed before we continue with this hearing let us be very clear that the subcommittee has no intention of interfering or impeding the investigations currently being conducted by the nara inspector general the secret service or the federal bureau of investigation we urge everyone's cooperation with these investigations and i thank all of our witnesses for appearing today and look forward to their testimony mister clay now we are on a tight schedule today so what i am going to do is normally we would yield to the ranking member who is not here yet when he gets here he will be allowed an opening statement but i will swear the witnesses in i will introduce you and swear you in  ms thomas is currently the acting archivist of the united states prior to her appointment as acting archivist in december two thousand and eight ms thomas served as the deputy archivist of the united oversees the conduct and execution of all audits investigations and inspection for the agency in compliance with provisions of the inspector general act of one thousand nine hundred and seventy eight as amended mister brachfeld's entire career has been devoted to investigative activities since graduating from the university of maryland college park in one thousand nine hundred and seventy nine go terps and today he brings ten holdings and related successful prosecutions of identified subjects and we look forward to his testimony i want to welcome all of you to our hearing today and it is the policy of the oversight and government reform committee to swear in all witnesses before they testify would all of you please stand and raise your right hand be included in the hearing record the yellow light will indicate that it is time to sum up the red light will indicate that your time has expired ms thomas you may begin your opening state thomas thank you chairman clay and members of the subcommittee i appreciate this opportunity to discuss a recent security incident that is a serious breach of the trust placed in the national archives to protect our nation's records learned in late march that an external computer hard drive containing copies of clinton administrative executive office of the president records was missing from the electronic records processing room as the acting archivist and  someone who has devoted my entire thirty nine year career to the national archives i am deeply angered that a nara employee or contractor may have intentionally removed this item with me today are nara's general counsel and senior agency official for privacy gary stern and sharon thibodeau deputy assistant archivist for records services the loss of the hard drive occurred while nara was conducting preservation processing of electronic media received from the executive office of the president eop at the end of the clinton administration tapes containing snapshots of the contents of the working drives of eop employees were copied by a contractor to new media to prevent deterioration on september eighteen two thousand and eight two my book hard drives created by the contractor were delivered to nara the hard drives were labeled master no two and backup no two the two hard drives were taken to suite five thousand three hundred at the national archives in college park and placed on a shelf in the unclassified electronic records processing room within the suite at the time approximately eighty five nara employees and contractors had badges that opened the three doors to the office area of the suite individuals with badge access to suite five thousand three hundred also had access to the electronic records processing room for unclassified records on october th the work of verifying the records on the hard drive was assigned to an information technology specialist work was performed only on the master no two hard drive not the backup no two which would later be missing on february five two thousand and nine the it specialist placed the master no two hard drive into its original manufacturer's box and noted that the backup no two hard drive was in a similar adjacent box the two boxes remained on a shelf in the processing room and no additional work was done on the hard drive until march twenty four two thousand and nine when the it specialist discovered that the box that had contained backup n hard drive was empty the master no two hard drive was still in its box an immediate division wide search was initiated on april two two thousand and nine the inspector general general counsel and i were informed of the loss while the office of the inspector general continues its investigation there are currently no facts to determine whether the drive was stolen or misplaced and no suspect has been identified nara has offered a reward of up to fifty thousand dollars for information that leads to the recovery of the missing hard drive nara staff reviewed the master no two hard drive and discovered that it contained numerous files containing personal names and social security numbers in addition nara also found a small number of files that contained markings indicating they may contain classified information while information from the eop provided at the time of transfer indicated that the hard drive not contain classified data we believe eop employees must have accidentally or improperly stored some classified information on their unclassified computers we are compiling a list of those individuals who may have had their personal information compromised and a credit monitoring contractor is notifying these individuals as they are identified to date approximately fifteen thousand seven hundred and fifty notification letters have been mailed nara is offering each individual one year of free credit monitoring services and fraud protection to date seven hundred and ninety six individuals have signed up for the credit monitoring services because of the extremely large volume of data on the drive over eight point seven million individual files we do not yet know the total number of individuals whose privacy has been affected nara has taken steps to improve internal security in our electronic records division first we have added separate bad access controls to the doors opening the processing rooms in suite five thousand three hundred there are now only entrances to the processing room and only individuals with badges programmed to open these doors may enter the separate locked block of shelving within a locked stack area accessible only to authorized employees finally all nara staff are required to complete training on how to handle sensitive information including the new security procedures the office of records services is also conducting unannounced inspections of all records branches and divisions on a periodic basis and supervisors are required to do periodic walk through inspections during the day when the investigation of this incident by nara's office of inspector general and secret service is completed i can assure you that we will act on the results with swift and appropriate disciplinary actions if it is determined that any nara employees were responsible for removing the hard drive or failed to adhere to proper records handling procedures the national archives is a public trust and the three thousand women and men who work at nara's forty four facilities across the country take their job and that trust very seriously every day our staff performs work that is vital to our democracy by preserving and safeguarding the more than nine billion records that make up the national archives of the united states at the same time we must balance safeguarding the records with providing the people of this country access to those records as with any endeavor that relies on the work of human beings our work despite our best efforts and intentions is subject to error however the loss of even one record or breach even one individual's personal information is unacceptable and i assure you that nara will continue to improve our security procedures and ensure that all staff is inculcated with the importance of following these procedures given the mister chairman and members of the subcommittee i thank you for offering me the opportunity to testify today i have been called before the subcommittee to provide testimony on the circumstances surrounding an external computer trust that in reaction to the loss of a hard drive new policies procedures and processes will be defined and implemented at nara and certainly my office will evaluate these actions provide guidance and appropriate independent and skilled oversight however our focus now is on the criminal investigation of the disappearance of the hard drive capable of holding two terabytes of our government's information and which my forensic investigator informs me was essentially filled with data at the outset i must say i am not able to talk about all aspects of the investigation at this time this is an ongoing criminal investigation which may have elements affecting national security therefore i know that the chair and members of this distinguished committee would not wish me to provide any information that could potentially damag investigation's integrity or potential success currently we are working with the assistance of the u s secret service and the federal bureau of investigation to more precisely identify the content of the hard drive however an initial cursory review identified that thousands of examples of personally identifiable information p i data reside on the hard drive we reported this to nara management officials and they have hired a contractor to further analyze this p i aspect and provide breach notification per omb requirements i should also note that at my request the special agent in charge of the secret service washington field office generously made their hotline operation available to us in order to support the investigation and potential recovery of the missing drive in response to our suggestion nara has estab reward of up to fifty thousand dollars for information leading to the successful recovery of the missing hard drive no productive leads have resulted to date from this action the subcommittee has asked about the security in place at nara at the time the hard drive went missing and after the hard drive went missing the direct answer is that the controls in place were inadequate and what controls were in there were readily bypassed and obviously compromised on an ongoing and dynamic basis quite simply this was an accident waiting to happen and now it has as a direct result of these failures in controls my office's capacity to investigate this incident has been severely compromised the loss went unnoticed potentially for months conservatively speaking at least one hundred and fifty people had access to the area and even rudimentary access controls such as badge or sign in logs were not maintained or could be readily bypassed while the drive was kept in an area ostensibly secured by a proximity card reading lock in practice this system failed people could simply piggyback by going through the door when othe persons opened it and even worse doors which should have been secured were propped open for ventilation purposes it was also reported to my investigators that the processing area in which the hard drive went missing was used as a conduit or shortcut to the rest rooms therefore it can be argued that the security for this area was no greater than the general security for the building as a whole the loss of this hard drive holding pra materials is not the only concern i have in this investigation many in the pool of potential subjects of this criminal have access to the processing area where this drive disappeared as well as more traditional storage or stack areas therefore i cannot say with any confidence that data stored in these areas was not compromised this includes the records of the commission the warren commission as well as large quantities of other national security holdings in a benign case where proper controls were in place and a subject hard drive was lost or ruinously disposed of one might take comfort that other data was not compromised the facts dictate that i am afforded no such comfort if the drive was deliberately removed the person or persons could have just as readily removed other holdings or copied information onto other mediums i am also deeply concerned about how nara generally treated the category of presidential data like that which was on the missing hard drive specifically when the data was copied from original executive office of the president eop computer tapes to modern hard drives the copying was done by contractors offsite without any security requirements nara had a fixed price delivery thousand four hundred and twenty eight such eop computer tapes to external hard drives to include the missing hard drive a small business was provided complete custody and control over the housing content of the eop material amazingly this contractor was one in a series of like contracts in which nara was silent in addressing any security requirements for the tapes or the information which they held in fact the contractor made absolutely no mention of the sensitivity of these records nor included a nondisclosure agreement when handling and processing asked the acting archivist of the united states do you recognize nara is a national security agency she stated no nara is not a national security agency by any shared means of that term within the executive branch for which we are aware nara does not make nor does it implement national security policy nara's only relationship to national security is our responsibility for ensuring that those security classified records that come into our custody from other agencies are stored protected and handled following the rules for which all agencies that handle classified records must adhere i would submit that nara has in this and other recent cases breached that relationship while by some technical standards nara may not meet the traditional definition of a formal national security agency the information and records we hold are vital to our nation's security what i will say specific to the loss of this hard drive is that the american people deserve better security and accountability than nara has provided them i can assure you that through our audits and investigations management consultation es and records administration organizational issues but i think that is sort of diminishing the import of this and organizational issues i think is putting it lightly the scope or the magnitude of the problem that we facing the national archives is an agency with an extremely important function it serves as the keeper of our nation's valuable records preserves government and historical records that include copies of acts of congress presidential proclamations and federal regulations while the archives maintains public access to some documents other records contain highly sensitive data mister brachfeld thank you for touching on the national security component in your testimony and these must be secured to ensure our national security and shield personally identifiable information as well the effectiveness of the archives as protector of the records under its control is key to preserving our history and maintaining accountability in our government the archives conducts truly invaluable work very important work obviously yet they are an agency that the public doesn't often hear much about unfortunately they have been getting quite a lot of press lately all of which or most of which seems from the agency's college park facility sometime between october two thousand and eight and march two thousand and nine when its absence was first noticed that drive contained one terabyte of information and what we have come to security numbers the personal contact information of presidential administration officials the entire computer files of one hundred and thirteen former white house employees secret service and white house operating procedures and other highly sensitive information disturbingly the missing hard accessible to personnel without clearance even now it is still not known whether the hard drive was misplaced lost or stolen or even when it actually went missing it is my hope that the national archives management would immediately react to what has been called a catastrophic loss by tightening security and accessibility at their college park facility particularly in the area which the hard drive was removed however when a bipartisan group of oversight committee staff  visited the campus on july th they observed many of the same deficiencies in security measures and left with the impression that a motivated criminal would be able to remove sensitive material with little to no resistance now this is a bipartisan assessment there wasn't much of an effort on the part of national archives staff to even make it appear that substantive changes had been made to secure the location to be fair the pattern of material or actually rather socks stuffed full with classified uninventoried documents there are many more alarming cases of negligence at the archives yet none as egregious as the disappearance of the hard these include the disappearance of six dollars million worth of taxpayer funded equipment over the periods of two thousand and two to two thousand and six the disposal of countless original records from the bureau of indian affairs with the archives trash and the disappearance of fifty five thousand pages of cia and other federal agency records right off the shelf in two thousand and six there is a prevalent culture of carelessness at the national archives and it must be replaced with meticulous accounting for all materials paper and electronic nominee as archivist to replace ms thomas david ferriero quite frankly i believe this announcement couldn't come soon enough mister ferriero has certainly had a lot of experience managing mass quantities of paper and electronic documents and other information in his tenure as director of research libraries at the new york public library and i look forward to hearing about his qualifications and his plans for the national archives at his senate confirmation hearing whenever the senate really gets around to doing their job and i thank the witnesses for appearing here today and look forward to the testimony and explanation of how the hard drive full of sensitive information was lost or stolen nderstand what was on the hard drive what does it mean by personally identifiable information to damage a person's security banking for identity theft along those lines it could be names addresses associates that kind of information as this information was a compilation from the clinton administration it was a compilation it has information that was resided on individual computers and thus there is information that meets that definition that resided on the hard drive that is missing most of these parties have not been so notified ms thomas we don't at this point know how many people's names and social security numbers are on the hard drive ms norton why do you not know that information are eight point seven million individual files on this hard drive and we have a contractor at this time trying to extract all of the data that they can to come up with the lists t contractor like this one off the premises this is another contracting out matter where people who apparently should not have been handling secure information were doing so now where is this contractor located and why couldn't this be done on the premises so the hard drive would not have had why did the hard drive have to leave the premises i suppose is my question let me answer your last question the process of copying the information from white house tapes or what were white house eop employees tapes to the hard drive was done offsite and that is what i testified regarding that was done offsite up in new jersey and that is where i have raised significant security issues the second part of your interest which is on now attempting to mine and identify those individuals whose pii may have been compromised that is under a separate contract which is being administered by the archives the reason it is taking so exceptionally long is this is probably as far as i know through my thirty year yielding the pii element to the contractor what we are attempting to do is to use the latest forensic investigative software available this is not normal data that sits in one standard language or one standard format if you think about every record that you have ever captured over your career in different languages and different spread sheets and different formats all being compressed into one in terms of a nefarious act someone trying to use the data that would not be very easy to do ms thomas given that we have a contractor that was suggested to us by the national security agency as somebody that they had worked with who they thought missing somebody took it for purposes of benign intent just to use it for their own medium or the worst case scenario that it was taken for more nefarious purposes that is a potential i also want to state that people with the correct technologies and tools can mine this data we have a contractor now that is trying to my investigation is focusing on how it happened and what the impact of the loss is and if we can find the subject i am also looking at what classified material resided on that hard drive and other sensitive information i am no longer involved in looking at pii content that has now been yielded to the contractor working for the national archives what i can say is again people with the capacity to read this data the tools can do it my investigators my forensic auditor could in fact pull up pii information fairly readily now to find the tremendous quantity to issue pii letters as the agency is doing that is another subject but certainly somebody with if they had that intent and if in fact it really is out there and somebody is using it for that purpose certainly they could pull p i information off of that drive ms norton mister chairman could i just ask to the extent that there is a discovery of criminal use of this information that the chairman of this subcommittee be informed immediately i don't know what people could do to protect themselves but i think the worse thing to happen in a circumstance like this is not to even know that out studies on job satisfaction within the federal government and i think it was american university's best places to work in the federal government two thousand and nine american university's institute for  extraordinarily low in terms of job satisfaction within the federal government it is actually i think the second to last of all the institutions they studied do you think there is a linkage between job satisfaction well actually let's start here what do you attribute the low job satisfaction assessment to ms thomas well we did some further analysis of what the different rankings were in the different parts of the national archives and the truth of the matter is that most of the very low rankings came from our regional facilities and we have for example in our federal record centers which are fairly low paid occupations they are not exactly intellectually stimulating it is people moving boxes in and out and so forth there is not a whole lot of promotion potential within the records center system and a great deal of the very low scores in terms of job satisfaction came from those regional activities if you look at the national archives in the washington area we rank at at least the same average as most other agencies or a little higher so the regional scores basically bring the agency score down to the level that is reported in that study  original kept wasn't it all in the same desk ms thomas the originals are the tapes that were delivered from the eop at the end of the clinton administration those tapes were backed up onto these having a master the original and the backup the two drives is there a process to keep them separate if you have the backup and  the main drive right same information is there any policy you have within the archives to keep them in separate locations ms thomas not while they are being processed and that is what was happening at the time that the hard drives were there mister mchenry is it not true that the reason why we don't know if it is october or march is because they have been sitting on someone's desk the whole time and they were not being processed they were left out untouched ms thomas i think it is unclear how archives about how to handle two copies of the same data mister brachfeld i will answer your question by getting specific in this matter in this case i should note that drives that were not used new were maintained in a locked area whereas the drives that were in process and therefore holding the kind of data and quality of data we talked about today were left in an unlocked exposed area put back in the original box so to me it seemed curious and bothersome troublesome that clean tapes are locked up for security but tapes that have documentation were left in an open area as far as policy  procedures i guess more specifically that is what we are investigating right now my focus is investigating a potentially criminal act we have time and we will look at audit issues we will look at new internal controls i can simply say as i said in my testimony and your backup car key on the same key chain it seemed that it was very basic procedure that was not instituted nor was there a culture of following those procedures to ensure that you have two pieces of data right kept separately both secure so that therefore you have in this new technology age that we have with diminishing documents from the 's as that technology is getting older that you would actually have those policies and procedures so you know to the larger issue here is making sure this doesn't happen again for any administration or any document and with that i yield back  it begs the question of the backup system that there be a fool proof backup system let me ask both witnesses do you know anything about hundreds of thousands of veterans pii that has been compromised when the national archives sent unencrypted hard drives to a vendor in return for  replacement of hard drives and if you do what has been done to inform veterans that their information has been compromised either one mister brachfeld i will answer that by saying we are in the process as i stated in my last semiannual report of conducting an investigation specific to that matter at this time i do not have information to the extent that i could respond fully to that question we do believe an event occurred the question is what is the nature of the event and what are the implications we are currently investigating that matter there have also been other issues related to and have been reported in a management letter related to saint louis and the military veterans records in terms of other pii policy and procedures that have been violated that also potentially compromises veterans information and again that is an issue which i cannot discuss in a public forum because should that information be made available publicly it could be damaging so i respectfully cannot i don't think you would want me to discuss this in this public forum mister clay ok well i will go to my next witness has taken steps to improve security at the washington national records center what is the status of those missing boxes and what has nara done to improve the management of classified and other materials at the washington national records center ms thomas there are two vaults at the washington national records center one contains top secret sci and r d material and the second vault contains secret and confidential  information the washington national records center has almost four million cubic feet of records of those three hundred and thirty three thousand are classified either at the top secret sci or secret or confidential the controls the isoo made recommendations twenty two different recommendations for how to improve security at the washington national records center at this stage i believe all hired resources have been thrown into the records center to do a complete inventory of both vaults they started on the top secret and the sci one and they completed that inventory initially they found one thousand four hundred boxes that were not where they were supposed to be they then did a complete check and got that number down to i believe one hundred and twenty five boxes of material that is not apparently on the shelves at the washington national records center these records are owned by the agencies they are not nara records they are not archival records they are often called back by the agencies and often what has happened in the past is that an agency calls back records and they either keep them because they are their records and they have that right they will send them back some months or years later in another accession so that the number changes in terms of how you identify the records and they get shelved as a new accession and they contain boxes from the old accession so there certainly was a record keeping issue that needed to be straightened out so we could keep better control over what went back to the agency whether they were permanently withdrawn and kept in the agency or whether or not they were returned to the washington national records center we are now for the one hundred and twenty five boxes that are still not accounted for we have contacted six different agencies whose records these are and asked them if they could check and find out if perhaps they have a record of whether or not they borrowed back these records i believe there was something from the energy department just in the past few weeks that said oh yes they have fifteen of the boxes that they have been able to account for so we are still working the process to find out where the records are and a similar inventory of the secret and confidential vault is underway and we will go through the same process of completing the inventory determining to the best we can where the records are and whether or not  three of us were informed gary is here because he is the privacy officer for the agency and has responsibility for pii mister mchenry so what have you done to address this so it doesn't happen again ms thomas the office of record services for washington did a complete review of procedures and has implemented much more stringent procedures to make sure that it doesn't happen again some of them i went through in my testimony and they are in more detail in my longer testimony that is submitted for the record have put card readers on doors where before you could go into the office area and then go into the processing area the card reader on the office door would in essence get you into the office area and into the processing office now the processing space has another layer of security and so you have different card reader access for those  s they are doing spot inspections the supervisors and managers are going through the space to make sure that the procedures that we put in place are being adhered to we intend to  do more training for people so that they truly get the message that this is a basic part of their job is protecting the records that they are working with and that is a balancing act  between providing access for research purposes and securing the items but securing the items is a critical critical part of their job mister mchenry certainly now are you familiar with the inspector general  artifacts were not maintained in appropriate space so the audit there expressed some of the same failings that resulted in the disappearance of this data did you have process it was at various stages in the different libraries we indeed poured more resources into completing the inventories and they are underway some of them have been completed  some of the problems that existed in the older libraries will not exist for the bush library or any library going forward because there will be a computer system that tracks every artifact as  arrives in the white house and then that system is provided to us so that we will have a complete list to start out with the record keeping in the white house gift office wasn't as complete in the past and it was not consistent if i can give you an example a tea set is that one item or is that a teapot and four cups and is there a tray is that seven items you know there was no consistency in how they dealt with it mister mchenry but within one division of the archives when you have issues like you know not having information secured in appropriate space does that raise questions for the overall system do you look at overall systems within the archives or is that just one division and therefore isn't applicable to anywhere else thought you said in my last question that they had already done a complete review ms thomas they did it for the electronic records division they are branching out to all of their records holding units and as you said looking at it more holistically across the agency as opposed to just in one division so we are looking at all security procedures and whether or not they are sufficient whether they need to be improved we certainly have decided that we need to improve our training and that we need training at a lot of different levels for example i am proposing that we will train every employee that comes to the national  es as part of their orientation whether they are a budget analyst or whatever to make them understand what the mission of the agency is and that everybody has a responsibility to make sure that records are protected mister mchenry thank you thank you very good had a hotline set up for any questions that anybody did have and we also had an email box where they could contact us and yes the most frequently asked question that came to us was is this a scam is this somebody who is you know prince so and so from somewhere who is you know trying to get hold of my personal information and drain my bank account or something so we have  exactly so i think some people thought weren't sure is this really from the national archives or is this just some company just trying to you know solicit my business and so we assured those people that it really was from us we referred them to our web site and we put up an updated notice to say we have sent these letters out and they are legitimate and we are informing you of this potential breach and offering this service so there was some confusion that we just hadn't occurred to us that would result  we reviewed the language in the breach notification letter just as a courtesy and the language in the breach notification seemed to be appropriate as far as the contractor the mailing that is completely outside of my domain mister clay so there was really t hotline number that they could call and they were notified that they could look at our web site for further information so that if they had any questions about the breach notification they could contact us in several different ways  regarding the copying of executive office computer tapes onto this hard drive why were security requirements not built into the contract documents with your vend to the contractor in hindsight our people should have included some additional security requirement clauses in the contract and that will certainly be a part of any contract going forward brachfeld i have pretty much all the documentation related to this contract and what is clearly missing is any any mention of security as even a consideration within the body of any of the solicitation the company that received the tapes did not even respond in terms of their having any security arrangements in place again there was no clause for nondisclosure of information as should be customary in such a sensitive information mister brachfeld we visited the site and it is not the contractor's fault per se because the contractor was doing a duplication service they were honoring the terms of the contract but if you went to the contractor site as my age did along with other law enforcement you would have seen a basic storefront operation with security clearly not the focus you would see that the tapes were kept in a room where doors were propped open also i have actually images of this and it will be in my investigative report when it is finalized or i could present them to you subsequent to this hearing it was not the environment that one would expect you would keep something of even minimal importance to get anyway they are not cheap objects to have lying around much less with no information much less with sensitive information on it and so it seems to me that even so much as actually taking that hard drive instead of leaving it out putting it in a locked desk drawer would have been a world apart from what happened or as near as we can tell happened with the minimal amount of information  actually known right now and as the ig still has the investigation going on and i would love to have any information as you produce it that you are able to share with us we would certainly