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IMPROVING SECURITY AND EFFICIENCY AT OPM 

AND THE NATIONAL BACKGROUND INVESTIGATIONS BUREAU 

HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 2, 2017 

Serial No. 115–12 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://oversight.house.gov 


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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

Jason Chaffetz, Utah, Chairman 

John J. Duncan, Jr., Tennessee 

Darrell E. Issa, California 

Jim Jordan, Ohio 

Mark Sanford, South Carolina 

Justin Amash, Michigan 

Paul A. Gosar, Arizona 

Scott DesJarlais, Tennessee 

Trey Gowdy, South Carolina 

Blake Farenthold, Texas 

Virginia Foxx, North Carolina 

Thomas Massie, Kentucky 

Mark Meadows, North Carolina 

Ron DeSantis, Florida 

Dennis A. Ross, Florida 

Mark Walker, North Carolina 

Rod Blum, Iowa 

Jody B. Hice, Georgia 

Steve Russell, Oklahoma 

Glenn Grothman, Wisconsin 

Will Hurd, Texas 

Gary J. Palmer, Alabama 

James Comer, Kentucky 

Paul Mitchell, Michigan 

Elijah E. Cummings, Maryland, Ranking 

Minority Member 

Carolyn B. Maloney, New York 

Eleanor Holmes Norton, District of Columbia 

Wm. Lacy Clay, Missouri 

Stephen F. Lynch, Massachusetts 

Jim Cooper, Tennessee 

Gerald E. Connolly, Virginia 

Robin L. Kelly, Illinois 

Brenda L. Lawrence, Michigan 

Bonnie Watson Coleman, New Jersey 

Stacey E. Plaskett, Virgin Islands 

Val Butler Demings, Florida 

Raja Krishnamoorthi, Illinois 

Jamie Raskin, Maryland 

JONATHAN SKLADANY, Staff Director 

WILLIAM MCKENNA, General Counsel 

JULIE DUNNE, Senior Counsel 

MICHAEL FLYNN, Counsel 

SHARON CASEY, Deputy Chief Clerk 

David Rapallo, Minority Staff Director 


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C O N T E N T S 

Page 

Hearing held on February 2, 2017 ......................................................................... 1 

WITNESSES 

Ms. Kathleen McGettigan, Acting Director, U.S. Office of Personnel Management 

Oral Statement ................................................................................................. 6 

Written Statement ............................................................................................ 8 

Mr. David DeVries, Chief Information Officer, U.S. Office of Personnel Management 

Oral Statement ................................................................................................. 13 

Mr. Cord Chase, Chief Information Security Officer, U.S. Office of Personnel 

Management 

Oral Statement ................................................................................................. 13 

Mr. Charles Phalen, Director, National Background Investigations Bureau 

Oral Statement ................................................................................................. 13 

Mr. Terry Halvorsen, Chief Information Officer, U.S. Department of Defense 

Oral Statement ................................................................................................. 14 

Written Statement ............................................................................................ 16 

APPENDIX 

February 9, 2016, Worldwide Threat Assessment by Mr. James Clapper, 

submitted by Mr. Lynch ...................................................................................... 60 

Response from the Office of Personnel Management to Questions for the 

Record ................................................................................................................... 93 


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IMPROVING SECURITY AND EFFICIENCY AT 

OPM AND THE NATIONAL BACKGROUND INVESTIGATIONS BUREAU 

Thursday, February 2, 2017 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, 

Washington, D.C. 

The committee met, pursuant to call, at 9:02 a.m., in Room 2154, 

Rayburn House Office Building, Hon. Jason Chaffetz [chairman of 

the committee] presiding. 

Present: Representatives Chaffetz, Jordan, Amash, Massie, 

Meadows, DeSantis, Ross, Blum, Hice, Grothman, Hurd, Palmer, 

Comer, Mitchell, Cummings, Maloney, Lynch, Connolly, Kelly, 

Lawrence, Plaskett, Demings, Krishnamoorthi, and Raskin. 

Chairman CHAFFETZ. The Committee on Oversight and Government Reform will come to order. 

And without objection, the chair is authorized to declare a recess 

at any time. 

I appreciate you all being here. We have a very important hearing. We have a number of members that, I’m sure, will be here but 

will be a little bit late. There is the National Prayer Breakfast, and 

getting across town at this time of day is a very difficult task, 

so—— 

But, nevertheless, I’m glad to have you here and look forward to 

this important hearing. 

Two years ago, the Office of Personnel Management suffered one 

of the most damaging data breaches in the history of the Federal 

Government. This went on for some time, and there are still additional details that need to be learned. 

But the counterintelligence value of the data that was stolen will 

last for an untold amount of time, a generation or so. So it troubles 

me to hear reports that maybe some of the things that led to this 

haven’t necessarily been changed at the Office of Personnel Management. 

We have a number of questions that I think we need to explore. 

For example, are legacy systems still in use for backup investigations? Is OPM employing good cybersecurity practices such as dual 

factor authentication and network segmentation? What is the plan 

to transition all of OPM’s systems off this legacy technology? When 

will OPM stop using unsecured and vulnerable legacy technologies 

such as Cobalt and start using maybe some modernized solutions 

that can be put on the cloud? 


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How is OPM protecting the inside of the network and not just 

building the cyberwalls higher? Will OPM adopt a zero-trust model 

as part of their cybersecurity strategy? You can’t steal what you 

can’t access, and a zero-trust model makes life much harder for the 

hackers. These are some of the questions we’ll continue to ask and 

explore. 

We said it in the committee’s data breach report, and I’ll say it 

again, chief information officers matter. They really do matter. 

That’s why we have two of them on the panel today. Federal agencies, particularly CIOs, must recognize their positions are on the 

frontline of defense against these cyber attacks. And as the government, we’re on notice. Leadership at the Federal agencies must be 

vigilant about the ever-present national security threats targeting 

their IT systems. And especially in OPM’s case where the IT systems are protecting some of the most vulnerable information held 

by the Federal Government. 

The National Background Investigation Bureau, also known as 

NBIB, N–B–I–B, was partly born from the failures at the Office of 

Personnel Management. When OPM last testified before the committee, in February of 2016, the NBIB had just been announced. 

During the hearing, questions were raised about the accountability 

and how this new organization would operate given the split responsibilities with OPM overseeing the NBIB and the Department 

of Defense overseeing the IT security of the NBIB. 

Today, we’d like answers to those questions and assurances that 

we’re moving in the right direction and also, as to when the new 

organization will be fully operational with a secure IT environment. 

Was the creation of the NBIB simply a rebranding effort, or does 

the NBIB represent real change? At our last hearing, we talked 

about how the many security clearance processes failed to check social media information of the applicants. The day before our followup hearing in May of 2016, the director of National Intelligence 

issued a new policy permitting the collection of publicly available 

social media information in certain cases. We’d like to understand 

how this policy is being implemented and if it is effective. 

Finally, the clearance process seems to be getting worse while 

the reform process continues. My understanding is at least—based 

on an OPM management memo of October 2016, there’s a backlog—at least then—there was a backlog of 569,000 cases. That’s 

quite a list. It does beg the question as to why we have to have 

so many background checks, but where are we at in terms of the 

backlog? And why, despite all the reform activities, is the clearance 

process taking longer? 

In fiscal year 2015, it took an average of 95 days to process a secret clearance and 179 days for a top secret clearance. In fiscal 

year 2016, it took an average of 166 days to process a secret clearance and 246 for a top secret clearance. That’s quite a jump in the 

timeline that it takes in order to get there. 

More than a decade ago, the security clearance data and processes were transferred from the Department of Defense to OPM, 

and now there’s talk of transferring this process back to the Department of Defense. We also have the newly created NBIB where 

OPM and DOD have a shared responsibility. And we need to get 


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this right, make sure that we have stopped just moving the organizational boxes around. 

As we continue our oversight of the transition of responsibilities 

from OPM to the NBIB, we need to continue to ask about the efficiency and making sure, at the end of the day, that we’re protecting and securing the United States of America. 

So there are a tremendous amount of number of people that are 

working on IT issues. We will have additional hearings and discuss 

that. 

I personally do believe—and this is—at some point, I would like 

to draw this out from you—attracting and retaining IT professionals has got to be a challenge for the government. It’s a challenge in the private sector. It’s a challenge across the board. 

I was fortunate enough to have a newly minted son-in-law, who 

is in the IT field. And the opportunities for him for employment 

were unbelievable. I’ve never seen anything like it, which is good 

as his father-in-law. That’s a good thing. 

But on a serious note, I do think we have to address, on the 

whole of government—not just this particular field, but the whole 

of government—how do we attract and retain IT professionals, because we do need so many of them, and there’s so much vulnerability for the country as a whole. 

So this is an important hearing, and I appreciate you being here. 

And now I’d like to recognize the ranking member, Mr. Cummings. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. I want to 

thank you for calling this hearing. 

And as I listen to you talk about the IT people, Mr. Chairman, 

this is very important that we all let Federal employees know how 

important they are, and that we do everything in our power to provide them with the types of salaries and work security that they 

need. That’s one of the things that would help to attract them and 

keep them. 

Today’s hearing is on the process our Nation uses to conduct 

background checks for Federal employees, who are seeking very important security clearances so they can have access to our most 

guarded secrets. 

This hearing could not come at a more critical time. Yesterday, 

I sent a letter requesting a Pentagon investigation of the President’s national security adviser, Lieutenant General Michael 

Flynn, for his potentially serious violation of the United States 

Constitution. I was joined by the ranking members of the committees on Armed Services, Judiciary, Homeland Security, Foreign Affairs, and Intelligence. 

General Flynn has admitted that he received payment to appear 

at a gala in December of 2015 hosted by Russia Today, that country’s State-sponsored propaganda outlet. 

During that event, General Flynn dined with Russian President, 

Vladimir Putin. As our letter explains, the Department of Defense 

warns its retired officers that they may not accept any direct or indirect payment from foreign governments without congressional approval, because they continue to hold offices of trust under the 

emoluments clause of the United States Constitution. 

On January 6, intelligence officials issued their report detailing 

Russia’s attack on the United States to undermine our election. 


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This report concluded with high confidence that the goal was to, 

quote, ‘‘undermine public faith in the United States’ democratic 

process,’’ end of quote. 

This report described as, quote, ‘‘The Kremlin’s principle international propaganda outlet,’’ end of quote. It explained—and I 

quote—that ‘‘The Kremlin’s staff’s RT and closely supervises RT’s 

coverage recruiting people who can convey Russian’s strategic messaging because of their ideological beliefs,’’ end of quote. 

It is extremely concerning that General Flynn chose to accept 

payment for appearing at an event hosted by the propaganda arm 

of the Russian Government at the same time that the country was 

engaged in an attack against this Nation in an effort to undermine 

our election. Something is wrong with that picture. 

But it is even more concerning that General Flynn, who President Trump has now chosen to be his national security adviser, 

may have violated the Constitution in the process. We do not know 

how much General Flynn was paid for this event and for his dinner 

with President Putin, whether it was $5,000, $50,000, or more. We 

don’t know. We do not know whether he received payments from 

Russian or other foreign sources or on separate occasions or whether he sought approval from the Pentagon or Congress to accept 

these payments. We don’t know. 

Related to today’s hearing, we do not know what effect this potentially serious violation of the Constitution should or will have on 

General Flynn’s security clearance. 

Security clearance holders and those applying for security clearances are required to report their contacts with foreign officials. We 

do not know what, if anything, General Flynn reported about his 

contacts with officials from Russia or other countries. We do not 

know if he reported this one payment or any other payment he 

may have received. These are the questions that need to be answered. 

We also have questions about the individuals who may seek to 

join the administration and obtain access to classified information 

while they are currently under investigation. 

For example, there have been reports that President Trump’s 

former campaign chairman, Paul Manafort, has been advising the 

White House recently while at the same time he’s, reportedly, 

under FBI investigation for his dealings with Russian interests. We 

want to know how security clearances are handled if the existing 

clearance holders or new applicants are under criminal investigation. Does the FBI allow these individuals to continue to have access to classified information, or is there a process to place a hold 

on someone’s clearance or application until the investigation resolves the questions? 

Finally, President Trump claims that Democrats only became interested in Russian hacking for political reasons and that, for example, we have no interest in cyber attacks against OPM. He stated, and I quote, ‘‘They didn’t make a big deal of that,’’ end of quote. 

The President is one million percent wrong. I and other Democrats worked aggressively on this committee’s investigation of the 

attacks on OPM. We held multiple hearings, including one that I 

requested. We conducted extensive interviews and briefings with 


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key witnesses. We reviewed more than 10,000 pages of documents, 

and we issued two reports from the majority and minority staff. 

I called for expanding our investigation to other agencies, including the State Department, the postal service, which were both attacked. 

I called for investigating the cyber attacks on financial institutions like JPMorgan Chase. Our intelligence agencies had warned 

us—I called for investigating the cyber attacks on the Nation’s biggest for-profit hospital chain, Community Health Systems, which 

had the largest hacking-related health information breach ever reported. 

And I called for investigating the cyber attacks on retail companies, including Home Depot, Target, and Kmart. So the President’s 

claim that we are focusing on Russia’s hacking for political reasons 

is ludicrous. Our intelligence agencies have warned us that if we 

do not act now, our adversaries, including Russia, are determined 

to strike again. We need to get answers to these questions immediately, and I thank all of our witnesses for being with us today. 

And, again, Mr. Chairman, I thank you for this hearing. And I 

yield back. 

Chairman CHAFFETZ. I thank the gentleman. 

We’ll hold the record open for 5 legislative days for any members 

who would like to submit a written statement. 

I now would like to recognize the panel of witnesses. We’re 

pleased to welcome Ms. Kathleen McGettigan, who is the acting director of the United States Office of Personnel Management. 

Ms. McGettigan is accompanied by David DeVries—DeVries, 

sorry—chief information office of the United States Office of Personnel Management; Mr. Cord Chase, chief information security officer at the United States Office of Personnel Management, and 

Mr. Charles Phalen, director of the National Background Investigations Bureau, or NBIB. Their expertise on this issue will be very 

important to this subject matter, so they will all—everybody will be 

sworn in. 

We’re also honored to have Mr. Terry Halvorsen is the chief information officer at the United States Department of Defense. It’s 

my understanding Mr. Halvorsen is retiring at the end of the 

month, and we could think of no better gift for you than having to 

testify before Congress. 

It’s such a joy. I know you’re looking forward to it personally. So 

happy birthday, Merry Christmas, and happy retirement for coming to testify before Congress. But we thank you, sir for your—— 

Mr. HALVORSEN. Thank you. 

Chairman CHAFFETZ. —for your service to this country and at 

the Department of Defense. And we really do appreciate your expertise and look forward to hearing your testimony. And we wish 

you well. 

And, again, thank you for your service and your willingness to 

be here today. You probably could have squirmed out of this one 

if you really wanted to, but you stepped up to the plate and took 

this assignment, so thank you, sir, for being here. 

Again, we welcome you all. Pursuant to committee rules, all witnesses are to be sworn before they testify. So if you would please 

rise and raise your right hand. 


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Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth and nothing but 

the truth, so help you God? 

Thank you. You may be seated. Let the record reflect that the 

witnesses all answered in the affirmative. 

Your entire written statement will be made part of the record, 

but we would appreciate it if you could keep your comments to 5 

minutes. And like I said, your whole record—your whole testimony 

and any supplements you have will be made part of the record. 

Ms. McGettigan, you are now recognized for 5 minutes. 

WITNESS STATEMENTS 

STATEMENT OF KATHLEEN MCGETTIGAN 

Ms. MCGETTIGAN. Good morning, Mr. Chairman, Ranking Member, and distinguished members of the committee. Thank you for 

the opportunity for my colleagues and myself to testify on behalf 

of the Office of Personnel Management. 

As you said, I am joined today by Mr. Charles Phalen, the director of the National Background Investigations Bureau, Mr. Dave 

DeVries, OPM’s chief information officer, and Mr. Cord Chase, 

OPM’s chief information security officer. 

While I am presently the acting director of OPM, I do have over 

25 years of service at the agency. 

OPM recognizes how critical the topics of today’s hearing are to 

the Federal Government and to our national security, and I look 

forward to our having a productive conversation about the NBIB 

transition, the security clearance process, and information technology security. 

As you know, the NBIB was established on October 1st, 2016, 

and is the primary provider of background investigations for the 

Federal Government. 

Charlie has a distinguished career in multiple roles at senior levels in the Federal Government and private industry. His career has 

been focused on national security. His experience includes serving 

in capacities at the CIA, including as director of security and with 

the FBI as assistant director leading its security division. 

NBIB is designed with an enhanced focus on national security, 

customer service, and continuous process improvement. Its new organizational structure is aimed at leveraging record automation, 

transforming business processes, and enhancing customer engagement and transparency. 

In late 2014, OPM’s market capacity for contract investigation 

services was drastically reduced by the loss of OPM’s largest field 

contractor. This resulted in an investigative backlog. This backlog 

was exacerbated by the cybersecurity incidents at OPM that were 

announced in 2015. 

Looking forward, it is an NBIB priority to address the investigative backlog while maintaining a commitment to quality. 

To accomplish this, NBIB is focusing efforts in three primary 

areas: First, we are working to increase capacity by hiring new 

Federal investigators and increasing the number of investigative 

field work contracts. 


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Second, NBIB is focusing on policy and process changes to ensure 

efficient operations. 

Third, NBIB has actively worked with customer agencies to 

prioritize the cases that are most critical to our national security. 

Information technology also plays a central role in NBIB’s ability 

to enhance the background investigation process. While still in development, NBIB’s new system, NBIS, will be operated and maintained by DOD on behalf of NBIB. 

On OPM’s behalf, this effort is being led by our new chief information officer, David DeVries. Dave joined us in September of 

2016. He is the DOD’s principle deputy CIO, and he has a strong 

relationship with his former agency. 

As we work to strengthen the infrastructure and security of 

NBIB, we are also working on fortifying our entire technology ecosystem. 

As the Federal Government modernizes how it does business, 

OPM has focused on bracing new tools and technology to deliver 

optimum customer service and enhanced security. 

OPM enhanced its cybersecurity efforts from multiple angles. We 

have added cybersecurity tools and security updates. We’ve implemented staff and agencywide training we’ve hired critical personnel 

and, finally, we continue to collaborate with our interagency partners. 

Touching on efforts I’ve just outlined, our cybersecurity tools and 

security updates include 100 percent multifactor user authentication to access OPM’s network. This is done via the use of PIV cards 

and major IT system compliance initiatives. Furthermore, OPM 

recognizes that cybersecurity is not just about technology, but it is 

also about people. 

OPM has added seasoned cybersecurity and IT experts to its already talented team. OPM has hired a number of new senior IT 

managers and leaders and realigned and centralized its 

cybersecurity program and resources under the chief information 

security officer. In this capacity, Cord is responsible for taking the 

steps necessary to secure and control access to sensitive information. OPM also strengthened its threat awareness by enrolling in 

multiple information and intelligence sharing programs. 

In conclusion, the necessary key partnerships and plans have 

been developed to build out NBIB and improve the security and efficiency of OPM’s IT systems. These structural and process improvements will enable us to improve timeliness, reduce the background investigation. Equally productive is the CIO’s holistic approach which ranges from bringing on qualified personnel to adopting new tools and procedures that enhance the security of OPM’s 

networks and data. 

Thank you for the invitation to testify before you today, and we 

welcome any questions you may have. 

[Prepared statement of Ms. McGettigan follows:] 


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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

STATEMENT OF 

KATHLEEN MCGETTIGAN 

ACTING DIRECTOR 

U.S. OFFICE OF PERSONNEL MANAGEMENT 

before the 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

UNITED STATES HOUSE OF REPRESENTATIVES 

on 

Improving Security and Efficiency at OPM and the National Background 

Investigations Bureau 

February 2, 2017 

Chairman Chaffetz, Ranking Member Cummings and Members of the Committee: 

Good morning Mr. Chairman, Ranking Member, and distinguished Members of the Committee. 

Thank you for the opportunity for myself and my colleagues with me today to testifY before the 

committee on the National Background Investigations Bureau (NBIB) transition, the security 

clearance process, and information technology (IT) security. As the Acting Director of the U.S. 

Office of Personnel Management (OPM), I can assure you we recognize how critical this is to 

the Federal government and to our national security. In keeping with our focus on modernizing 

the way that OPM carries out its important missions, OPM has worked to optimize the business 

processes surrounding background investigations. OPM has also taken aggressive measures to 

enhance the security of its IT systems, both within the NBIB and throughout OPM, accelerating 

an ambitious long-term IT security and modernization plan to upgrade the security of our 

systems and strengthen the agency's ability to respond to cyber incidents. OPM has also 

partnered with the Department of Defense (DOD) and other agencies to leverage governmentwide knowledge, resources, and best practices. 
9 


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Statement of Kathleen McGettigan 

Acting Director 

U.S. Office of Personnel Management 

February 2, 2017 

The National Background Investigations Bureau 

NBIB was established on October I, 2016, and is the primary provider of background 

investigations for the Federal government. NBIB is designed with an enhanced focus on national 

security, customer service, and continuous process improvement to meet this critical 

government-wide need. Charles S. Phalen, Jr., the NBIB Director, has a long and distinguished 

career in multiple roles at senior levels in the Federal government and private industry with a 

focus on protecting our national security. His extensive experience includes serving in various 

capacities at the Central Intelligence Agency, including as the Director of Security, and with the 

Federal Bureau oflnvestigations as Assistant Director leading its Security Division. 

NBIB conducts 95 percent of investigations across the government. Even those few agencies that 

have the statutory authority to conduct their own investigations, such as the Intelligence 

Community, rely on NBIB's services in some capacity. Its new organizational structure is aimed 

at leveraging automation, transforming business processes, and enhancing customer engagement 

and transparency. Through a strong partnership with DOD, NBIB will build a modern and secure 

IT system to comprehensively support the investigations process and enhance end-to-end 

processes across government. These efforts will ultimately improve the efficiency, cost 

effectiveness, and quality of the investigations across the Federal government. 

As you are likely aware, in late 2014, OPM's market capacity for contract investigation services 

was drastically reduced by the loss ofOPM's largest field contractor, resulting in an 

investigative backlog. This backlog was exacerbated by the cybersecurity incidents at OPM that 

were announced in 2015. Looking forward, it is an NBIB priority to address the investigative 

backlog while maintaining a commitment to quality and returning back to the level of 

performance realized from 2009 through 2014. NBIB, working with the Office of the Director of 

National Intelligence (ODNI), DOD and other customers, is focusing efforts in three primary 

areas. First and foremost, NB!B is working to increase capacity. NBIB hired 400 new Federal 

investigators in 2016, and NBIB recently awarded a new investigative fieldwork contract, 

increasing the fieldwork contractors from two companies to four. Work under the new contracts 

began on February I, 2017. Second, NBIB is focusing on policy and process changes to add 

efficiencies, reduce level of effort, and maintain investigative quality. To support this effort, 

NBIB, working closely with the DOD and interagency partners, conducted a detailed business 

process reengineering effort and worked in collaboration with ODNI in its role as the Security 

Executive Agent to identifY appropriate policy and process changes to help address the backlog. 

Third, NBIB has actively worked with customer agencies to prioritize cases and schedule those 

that are most critical to our national security and the mission needs of our customers. 

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Statement of Kathleen McGettigan 

Acting Director 

U.S. Office of Personnel Management 

February 2, 2017 

Information technology also plays a central role in NBIB's ability to enhance the background 

investigation process. A key component ofNBIB is to leverage DOD's cybersecurity expertise 

and resources to design, develop, and implement a modem and secure IT environment. While 

still in development, the new system, known as the National Background Investigation System 

(NBIS), is to be operated and maintained by DOD on behalf ofNBIB. NBIB is encouraged by 

the significant progress DOD has made toward new capabilities that will improve the 

effectiveness and security of background investigations. Concurrently, the OPM Office of the 

Chief Information Officer (OPM CIO), in coordination with our interagency partners to include 

DOD and Department of Homeland Security (DHS), has aggressively pursued further improving 

the cybersecurity posture of the OPM network. 

Role of the Office of the Chief Information Officer 

OPM has worked to strengthen the infrastructure and security of not only NBIB, but also OPM's 

entire technology ecosystem. This effort is being led by OPM's new CIO, David DeVries, who 

joined OPM in September 2016. Mr. DeVries had previously been the DOD Principal Deputy 

CIO and has a strong relationship with his former agency that facilitates coordinating the 

implementation ofNBIS. Indeed, as the Federal government modernizes how it does business, 

OPM has focused on embracing new tools and technologies to deliver optimum customer service 

and enhance the security of the information we house. In a rapidly changing and increasingly 

interconnected digital world, it is important for agencies to develop the best possible defenses 

and safeguards. 

Over the past eight months, OPM has successfully begun to roll out its program for 

implementation of the Federal Information Technology Acquisition Reform Act and enhanced 

the agency's infrastructure in ways that will help OPM support its cybersecurity initiatives and 

strategies, ensure its IT programs run more efficiently and securely in supporting the OPM 

business lines, and better utilize limited resources. 

OPM has enhanced its cybersecurity efforts from multiple angles: through the addition of 

cybersecurity tools and security updates; through staff and agency-wide training; through hiring 

critical personnel; and through collaboration with OPM's interagency partners. For example, in 

Fiscal Year 2016, OPM implemented 100 percent multi-factor user authentication for access to 

OPM's network, via the use of the "Personal Identity Verification" (PIV) card. This capability 

and enforcement provides a powerful barrier to our networks and information stores from 

individuals who are not authorized to have access. OPM is in the process of expanding this to 

agency applications to further increase the security of our systems. In 2016, OPM launched two 

major IT system compliance initiatives that resulted in all major IT systems having current ATO 

(Authority to Operate) and network segmentation. 

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Statement of Kathleen McGettigan 

Acting Director 

U.S. Office of Personnel Management 

February 2, 2017 

As the Federal government's personnel agency, OPM recognizes that cybersecurity is not just 

about technology, but is also about people and, to that end, in addition to strengthening its 

technology, OPM has added seasoned cybersecurity and IT experts to its already talented team. 

OPM has hired a number of other new senior IT leaders, and realigned and centralized its 

cybersecurity program and resources under the Chieflnformation Security Officer (CISO), a 

primary responsibility of which is to take the steps necessary to secure and control access to 

sensitive information. OPM also hired Information System Security Officers (ISSOs) in Fiscal 

Year 2016 to support all ofOPM's major information systems. 

OPM is continuing to leverage and utilize its interagency partnerships and the expertise of the IT 

and cyber communities across government. OPM strengthened its threat awareness by enrolling 

in multiple information and intelligence sharing programs. OPM was one of the first agencies to 

participate in DHS's Einstein 3A program, and was one of the first agencies in the Federal 

government to fully implement Phase I ofDHS's Continuous Diagnostics and Mitigation 

program. These initiatives allow agencies to detect and prevent cyber-attacks, and continuously 

identifY and proactively mitigate cybersecurity threats and vulnerabilities that might arise. 

The cybersecurity incidents at OPM provided an important catalyst for accelerated change across 

the Federal government. OPM met the challenge and greatly appreciates the collaborative spirit 

with which its interagency partners across government continue to work with us every day. 

Embracing modernization can help save taxpayer dollars, improve critical programs, and 

mitigate security risks in a world of continually evolving threats. OPM and DOD will continue to 

collaborate on the development of a state-of-the-art IT system for NBIB. By investing in IT 

systems across functions, we can drive more effective, efficient, and data-driven accomplishment 

of work across a variety of missions. 

Conclusion 

The necessary key partnerships and plans have been developed to build out the NBIB and 

improve the security and efficiency ofOPM's IT systems. We created a coordinated strategy to 

transition the investigative program to an organizational model that fosters innovation, focuses 

on customer service, and leverages interagency expertise. These structural and process 

improvements, in coordination with our partners, will enable us to improve timeliness and reduce 

the investigative backlog. In parallel, we are working closely with DOD's CIO to build the 

information systems capabilities to support this activity for now and the future. This productive 

partnership will enable an effective and secure information environment as a government-wide 

solution. Equally productive is the CJO's holistic approach, which ranges from bringing on new 

qualified personnel to adopting new tools and procedures that enhance the security ofOPM's 

networks and data for all ofOPM's lines of business, including NBIB. 

Page 4 of 5 
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Statement of Kathleen McGettigan 

Acting Director 

U.S. Office of Personnel Management 

February 2, 2017 

Thank you for the opportunity to testifY before you today, and we welcome any questions you 

may have. 

Page 5 ofS 
13 

Chairman CHAFFETZ. Thank you. Thank you for your testimony. 

Mr. DeVries, you are now recognized for 5 minutes. 

My understanding is maybe yourself, Mr. Chase, and Mr. Phalen, 

I don’t know if you have opening statements or if you care to say 

anything, but I’ll recognize each of you. If you don’t have anything, 

we’ll just—Mr. DeVries, do you have—— 

STATEMENT OF DAVID DEVRIES 

Mr. DEVRIES. Thank you, Mr. Chairman. 

I’d like to just take this opportunity to thank you for the opportunity to come here. As the brief bio was read there, I did come 

from 30 years in the Army. I transitioned in in 2009 to become a 

senior executive within DOD, and where I spent the last 2–1/2 

years as the principle deputy for the DOD CIO. 

Broad range here, I was asked to come here to OPM and accepted that and arrived here in September of 2016. And it’s a pleasure 

being here today, and I enjoy the opportunity to answer your questions here. Thank you. 

Chairman CHAFFETZ. Thank you. 

Mr. Chase. 

STATEMENT OF CORD CHASE 

Mr. CHASE. Thank you very much for the opportunity—— 

Chairman CHAFFETZ. If you can all bring that—I’m sorry. You’ve 

got to bring the microphones up close, uncomfortably close to make 

sure we can all hear you. 

Mr. CHASE. Again, thank you very much for the opportunity to 

speak today. One of the things that I want to make clear is I ran 

into the fire to help with the events that occurred in 2015. In the 

rebuilding process, we’ve made a lot of advancements, but it’s only 

to get us to a standard environment. By no means am I up here 

saying, we’re successful or we’ve won anything, that we’re doing 

our best to improve the environment to secure the information 

within OPM and NBIB. 

With that, there are quite a few items that I’d be happy to discuss with all of you on those improvements, and that’s all I have 

at this point. 

Chairman CHAFFETZ. Thank you. 

Mr. Phalen. 

STATEMENT OF CHARLES PHALEN 

Mr. PHALEN. Thank you, Mr. Chairman. I’m happy to be here 

and join with you today in a good conversation on this. 

To echo a little bit what Ms. McGettigan mentioned, we are focused in our—as we begin our—or end our 4th month as an entity 

on three key things. 

One is recovering and increasing our capacity to do background 

investigations, improving our capability to gather information that 

is relevant to background investigations and, finally, working on 

those innovations that will help us in partnership with the security 

executive agent and the suitability executive agent to look at what 

an investigation will look like as we move down into the future. 


KING-6430 with DISTILLER
14 

A key to this is building an organizational structure beyond what 

existed on September 29th and adding capabilities in terms of investments and in terms of innovation, and then very importantly, 

working in partnership with DOD as we build out an information 

technology systems that will be able to enhance and inform security investigations across our entire spectrum of about 100 customers across the Federal Government. 

With that, I’m very happy to be here. Thank you for the opportunity today. 

Chairman CHAFFETZ. Thank you. 

Mr. Halvorsen, you are now recognized for 5 minutes. 

STATEMENT OF TERRY HALVORSEN 

Mr. HALVORSEN. Good morning, Mr. Chairman, Ranking Member, and distinguished members of the committee. Thank you for 

the opportunity to testify before the committee today on the Department’s information technology and cybersecurity support to the 

National Background Investigations Bureau. 

I am Terry Halvorsen, the Department of Defense chief information officer. You have my opening statement. I think most of you 

are familiar with my responsibilities, so in the interest of time, I’ll 

cut this a little short. 

The department is responsible for the development and securing 

the NBIB IT systems. We have brought the full expertise of the department both in IT and cybersecurity resources to bear on this 

problem, and it is our objective to replace the current background 

investigations information system with a more reliable, flexible, 

and secure system in support of the NBIB. 

Defense information system under the DOD’s CIO’s oversight has 

established the National Background Investigations Systems Program Management Office to implement this effort. The PMO is responsible for the design, develop, and operation of the IT systems 

capabilities needed to support the investigative process to include 

ensuring that the cybersecurity protections and resiliency of these 

capabilities. The alignment of the systems under DOD assures we 

leverage all national security systems expertise and capability to 

protect the background investigation data. And I assure you, we 

are doing that. 

The Department has made significant headway on this important 

mission, since I previously testified before this committee last February, and we are on track to deliver the capabilities needed in an 

iterative fashion using DOD expertise and best industry practices. 

In fiscal year 2016, the Department funded preacquisition activities to better posture for official standup and funding in fiscal year 

2017. I would like to thank Congress and members of this committee for supporting the Department’s funding request for NBIB 

IT infrastructure and cybersecurity modernization. As you know, 

the fiscal year 2000 continuing resolution did include new start authority for the NBIB, and we thank you for that. 

Today, several of the NBIB’s prototypes are enabling the Department to work with industry and other partners to discover capabilities that we will provide with a more efficient, effective, and secure 

background investigation system in the future. 


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15 

Throughout this process, we are actively partnering with industry, integrating commercial feedback into the process to ensure we 

are focusing on capabilities and keeping up with the changing pace 

of technology. 

I am pleased with the current progress on NBIS that the Department and our partners have made to date. I look forward to seeing 

what this organization will accomplish as it makes progress toward 

delivering several prototype capabilities by the end of fiscal year 

2017 and an initial operating capability covering the full investigative process in the fourth quarter of 2018. 

This is an important opportunity for the Federal Government to 

strengthen the security of the IT infrastructure that supports the 

Federal background investigating process. This approach utilizes 

the Department’s recognized IT cybersecurity expertise, best industry practices while maintaining a streamline centralized governmentwide approach to the investigative services that the NBIB provides today for more than 100 different Federal agencies. 

Thank you for this committee’s continued support, and I look forward to your questions. 

[Prepared statement of Mr. Halvorsen follows:] 


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KING-6430 with DISTILLERInsert offset folio 6 here 26358.006

STATEMENT BY 

TERRY HALVORSEN 

DEPARTMENT OF DEFENSE CHIEF INFORMATION OFFICER 

BEFORE THE 

HOUSE OVERSIGHT AND GOVERNMENT REFORM COMMITTEE 

ON 

THE NATIONAL BACKGROUND INVESTIGATIONS BUREAU 

TRANSITON, RELATED INFORMATION TECHNOLOGY SECURITY, 

AND THE SECURITY CLEARANCE 

INVESTIGATION PROCESS 

FEBRUARY 2, 2017 

NOT FOR PUBLICATION UNTIL RELEASED 

BY THE HOUSE OVERSIGHT AND 

GOVERNMENT REFORM COMMITTEE 
17 


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Introduction 

Good morning Mr. Chairman, Ranking Member, and distinguished Members of the Committee. 

Thank you for this opportunity to testifY before the committee today on the Department's 

Information Technology (IT) and cybersecurity support to the National Background 

Investigations Bureau (NBIB). I am Terry Halvorsen, the Department of Defense (DoD) Chief 

Information Officer (CIO). As the senior civilian advisor to the Secretary of Defense for IT, the 

DoD CIO is responsible for all matters relating to the DoD information enterprise, including 

cybersecurity for the Department. In this capacity, the DoD CIO is responsible for oversight of 

the Department's efforts to design, build, operate, secure, and defend a new IT system to support 

the background investigative processes for the NBIB. NBIB provides investigative services for 

more than 100 Federal agencies to make decisions to determine whether individuals meet 

requirements for new or continued employment; are eligible to hold a sensitive position; or are 

eligible for access to Federal facilities, automated systems, or classified information. The 

relationship between DoD and OPM is strong and has been critical to our success thus far on 

NBIB. David De Vries, OPM's Chieflnformation Officer, who was previously serving as the 

Principal Deputy DoD CIO, has helped strengthen that relationship and brings critical IT and 

cybersecurity expertise to OPM. 

As the Department's focal point for the new background investigations IT system, the DoD CIO 

brings together the Department's full range of!T and cybersecurity resources and expertise. 

DoD's objective is to replace the current background investigations information systems with a 

more reliable, flexible, and secure system in support of the NBIB. The Defense Information 

Systems Agency (DISA), under the DoD CIO's oversight, has established the National 

Background Investigation System (NBIS) Program Management Office (PMO) to implement 

this effort. The NBIS PMO is responsible for the design, development, and operation of the IT 

system capabilities needed to support the NBIB investigative process- to include ensuring 

cybersecurity protections and resiliency of these capabilities. The alignment ofNBIB systems 

under DoD assures we leverage all national security systems expertise and capability to protect 

background investigation data. 

The Department has made significant headway on this important mission since I previously 

testified before this Committee last February, and are on track to deliver the capabilities needed 

in an iterative fashion. 

In fiscal year 2016, the Department funded pre-acquisition activities to better posture for official 

standup and funding in fiscal year 2017. I would like to thank Congress for supporting the 

Department's funding request for NBIB IT infrastructure and cybersecurity modernization 

efforts. The fiscal year 2017 continuing resolution (CR) included new start authority for NBIS, 

which has allowed us to make progress, including awarding a contract last month for the case 

management prototype. Today, several NBIS prototypes are enabling the Department to work 
18 


KING-6430 with DISTILLERInsert offset folio 8 here 26358.008

with industry and discover capabilities that will provide NBIB with a more efficient, effective, 

secure background investigation IT system in the future. Throughout this process, we are 

actively partnering with industry and integrating commercial feedback into the process, to ensure 

that we are focusing on capabilities and keeping up with the changing pace of technology. 

Conclusion 

I am pleased with the current progress on NBIS that the Department has made to date, and I look 

forward to seeing what this organization will accomplish as it makes progress toward delivering 

several prototype capabilities by the end of fiscal year 2017 and initial operating capability 

covering the full investigative process in the fourth quarter of2018. This is an important 

opportunity for the Federal Government to strengthen the security of the IT infrastructure that 

supports the federal background investigations process. This approach utilizes the Department's 

recognized IT and cybersecurity expertise, while maintaining a streamlined, centralized, 

Government-wide approach to the investigations services that NBIB provides today for more 

than 100 different Federal agencies. I want to thank you for this Committee's continued support 

for NBIB, and I look forward to your questions. 

2 
19 

Chairman CHAFFETZ. Thank you. 

I will now like to recognize the gentleman from Texas, the chairman of the subcommittee on Information Technology, Mr. Hurd. 

Mr. HURD. Thank you, Mr. Chairman. I want to thank you and 

the ranking member for the continued diligence on this important 

issue. 

Mr. Phalen, I’ve got some basic questions for you. Sorry for the 

basicness of the questions. 

You’re in charge, right? 

Mr. PHALEN. Yes, sir. 

Mr. HURD. Do you have a technical background? 

Mr. PHALEN. I do not have a technical background. 

Mr. HURD. Who is the person directly reporting to you that is responsible for preventing another attack that we saw, like the one 

we saw a number of months ago? 

Mr. PHALEN. So it is not a direct chain—— 

Chairman CHAFFETZ. Sorry. Mr. Phalen, if you could move that 

microphone. Straighten it up and right—right up next—there you 

go. Thank you. 

Mr. PHALEN. There you go. Okay thank you. 

There’s no one specifically in my chain of command that is immediately responsible. We rely on Mr. DeVries and Mr. Chase as the 

CIO and CISO to provide the security for the systems that we are 

operating today. 

Mr. HURD. Copy. 

So Mr. Chase, you are in charge. 

Mr. CHASE. That is correct, for cybersecurity. 

Mr. HURD. Well, thank you for running into the fire. 

Mr. CHASE. Thank you. 

Mr. HURD. I recognize the difficulty of the task. In your brief remarks, you talked about the first step was getting OPM up to a 

baseline. 

Mr. CHASE. Correct. 

Mr. HURD. Can you take 90 seconds and explain that baseline? 

Mr. CHASE. Sure. That’s a good question. So one of the things, 

when I came on board, was to set an appropriate strategy and a 

pathway forward. So it was the stabilization phase. So we understood that there were quite a few systems that were out of compliance. So we knew that we had to take steps to get those back into 

compliance. 

We also had another layer of engineering tasks, which included 

network segmentation, making sure that we had the appropriate 

monitoring tools in place, and then the tuning process to support 

that. 

Throughout fiscal year 2016, we were able to get those accomplished but, again, to a standard baseline where we feel comfortable that we can control our environment and we understand 

where we were with the IT system boundaries and the IT system 

boundary inventories. 

Mr. HURD. So of the IG GAO, they’ve all done reviews, there’s 

been a number of outstanding issues. Many of the outstanding 

issues for years had been on the IG report and the GAO high-risk 

report. 


KING-6430 with DISTILLER
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Of those documents, how many of those vulnerabilities, that have 

been identified, are still outstanding? 

Mr. CHASE. So there are still items that are outstanding, and we 

prioritized them based on their criticality—— 

Mr. HURD. What’s the highest priority—highest priority vulnerability that’s still outstanding? 

Mr. CHASE. So the IT system compliance was the most significant vulnerability that was identified in the Fiscal Year 2016 

FISMA report, as well as the IT security officer hiring process, 

which is something we were able to accomplish at the end of this 

year as well. 

Mr. HURD. Good copy. 

You talked about segmentation. And we saw after the breaches 

in 2014 and 2015, the hackers were able to basically move, you 

know, without—with impunity through the network. And my question is what have you done to make life harder on the hackers that 

once they get past your defenses? 

And I will say my—you know, I begin with the presumption of 

breach, you give an attacker enough time, they have enough resources, they are going to get in, so what do you do once they get 

in, and how have you improved segmentation across the OPM network. 

Mr. CHASE. So I consider it a level of effort, so I’m trying to make 

it as hard as possible for them to get in. Understanding that OPM 

is a customer-oriented agency and has to communicate. Some of the 

segmentation that we have done is identify all of our major systems and high-valued assets within our environment, as well as, all 

the privileged and nonprivileged users. 

We segmented those between each other and set the appropriate 

firewalls and monitoring tools to ensure that one can’t get to the 

another and vice versa, and if there are attempts to get between 

the other, the other is stopped and flagged, and there’s a followup with that event itself. 

Mr. HURD. In my remaining minutes, I want to ask a question. 

And I don’t mean to be indelicate. Why did we get to this situation? 

And I ask that question in order to learn from this experience so 

we can take those lessons learned and apply it across the Federal 

Government. 

Mr. CHASE. So I’m going to say I came post breach, and I know 

there’s quite a few lessons learned. There was a majority and minority reports issued, there’s all the audits that were issued, and 

that’s what I’ve been going off of and, again, trying to apply those 

to prioritize the next steps to be able suppress the threat and the 

risks within OPM. 

Mr. HURD. So why—you’ve been there now for enough time. 

You’ve seen the problems. You’ve probably been shocked by some 

of the deficiencies within the network. Why do you think that network got to where it was? 

Mr. CHASE. I would say based on those reports and information 

that was put in front of me, there were systematic failures within 

OPM that led to it. 

Mr. HURD. Mr. Chairman, I yield back. 

Chairman CHAFFETZ. I thank the gentleman. 


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We’ll now recognize the ranking member of the subcommittee on 

IT, Ms. Kelly from Illinois, for 5 minutes. 

Ms. KELLY. Thank you, Mr. Chair. 

And thank you all for your testimony here today. This is actually 

the committee’s third hearing on the OPM data breach. 

The data breach compromised the information of millions of Federal employees. The committee responded almost immediately and 

did an extensive bipartisan investigation into the incident. In total, 

committee staff reviewed more than 10,000 pages of documents, 

interviewed multiple witnesses, and had numerous briefings from 

both Federal and nonFederal entities. I applaud the work we have 

done on the OPM data breach, but I must address the elephant in 

the room. 

We are holding a hearing about hacking by a sophisticated actor, 

likely a State actor for a hack that occurred more than a year ago. 

But this committee has chosen not to take any action to investigate 

the recent Russian hacking and propaganda campaign to impact 

our election. 

Only last month, the NSA, FBI, and CIA concluded with a high 

degree of confidence that Russia successfully hacked groups 

throughout our Nation in an effort to influence our election. In the 

face of this report from our top intelligence agencies, we have done 

zero oversight into this issue. There’s not been a single hearing or 

request. 

My wonderful chairman on the IT subcommittee asked Mr. 

Chase about lessons learned. 

Mr. Halvorsen, I would like to ask you about lessons learned 

after the vulnerabilities were exposed in the OPM data breach. 

Mr. HALVORSEN. We certainly took the vulnerabilities that were 

exposed in the database, and I can assure you that both in the 

OPM legacy systems, the work they’re doing today and in the new 

systems, we are taking those lessened learn and making sure that 

the systems we are building new are built from the ground up with 

cybersecurity baked in, and that we’ve assumed from the beginning 

that this system could be penetrated. 

So there’s a condition we have that you might hear in the Navy 

termed, it’s set conditions ZEBRA, it means close the watertight 

doors. We are making sure that the new system will be segmented 

enough that we can close the doors. Because there’s two things you 

want to stop. Certainly, you want to stop people from getting in, 

but when they get in, you don’t want your answer to be you’ve got 

to shut the system down. That’s a victory. 

So we’re designing this system so that we can fight—and that is 

the correct word—fight through any attempt to breach this system. 

And if we get breached, be able to block and contain and then 

eradicate any malware system loss that gets in here. 

Ms. KELLY. Thank you. 

Did the subsequent investigations help in understanding how 

things could be improved? 

Mr. HALVORSEN. Absolutely. 

Ms. KELLY. Anybody else want to answer that? 

Mr. HALVORSEN. Yes, they did. 

Ms. KELLY. And any of the other witnesses? 

Mr. CHASE. I concur. 


KING-6430 with DISTILLER
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Mr. DEVRIES. Concur. 

Ms. KELLY. Thank you. 

I believe these OPM investigations went a long way in assuring 

the American public that everything possible was being looked at 

to prevent this from happening again. But it is clear that politics 

have prevented this committee from being willing or able to do the 

necessary objective and nonpartisan oversight on the Russian attack. That’s why I, and every one of my democratic colleagues in 

the House, have signed on to legislation to establish an independent bipartisan commission to investigate foreign interference 

in the 2016 elections. Thank you for your response. 

And, Chairman, I yield back. 

Chairman CHAFFETZ. Will the gentleman—gentlewoman yield 

first? 

Ms. KELLY. Of course. 

Chairman CHAFFETZ. As I’ve said publicly, and the gentlewoman 

should know, given that it involves sources and methods, the 

United States Congress is organized such that the House Intelligence Committee takes the lead on those things. We can investigate anything at any time, but I do have limits in that I cannot 

investigate sources and methods which clearly is the purview of the 

House Intelligence Committee. 

I would also suggest that we were the first committee to create 

a subcommittee specifically on information technology. We were the 

first to dive into the OPM data breach, and we have been pushing 

from the Department of Education and others to make sure that 

we do have the proper defenses in place. And to suggest that it’s 

only one particular country would be naive at best. And it could be 

everything from a guy in a van down by the river down to a Nation 

State. 

Ms. KELLY. We know it was the Russians in this particular instance. 

Chairman CHAFFETZ. And I think that should be investigated. I 

have said as much publicly, and I’ve also—I think everybody 

should know, every Member of Congress should know that the 

House Intelligence Committee is really the only organization within Congress that is set up to be able to do that. 

Mr. CUMMINGS. Would the gentlelady yield, please? 

Ms. KELLY. Yes, I will. 

Mr. CUMMINGS. Very briefly, Congressman Swalwell and I, over 

a month ago—as a matter of fact, in December, filed a bill which 

asks that we have a 9/11-type investigation. And the reason why 

we did that is because we didn’t want it to get mired in a political 

battle like the Benghazi Committee did, Select Committee. 

And it would be patterned after the 9/11 commission so that we 

would bring America’s best experts to the table. It would be an 

equal number of Democrats, an equal number of Republicans, and 

that they would look at this thing carefully—and with the chair’s 

indulgence, I need to explain this—and they would come back with 

recommendations. They would have subpoena power. 

Then we refiled that bill in January when the new session came 

in. Every single Democrat in the Congress signed on to that bill. 

Not one signal Republican signed on. And one of the reasons why 

we did that is because we felt we didn’t move to common ground; 


KING-6430 with DISTILLER
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we need to move to higher ground, that this was such a serious attack on our democracy, and our election process, that it deserved 

that kind of attention. And so that bill is still out there. Only 

Democrats have signed on. 

One of the things we were concerned about is the chairman of 

the Intelligence Committee, Mr. Nunes, was a part of the transition 

team for President Trump. And we just felt that we needed to take 

the complete thing out and let an independent body do it. And I 

just wanted to explain that to the gentlelady. 

Thank you very much. And thank you for yielding. Nice job, by 

the way. 

Chairman CHAFFETZ. I’ll now recognize the gentleman from Florida, Mr. DeSantis, for 5 minutes. 

Mr. DESANTIS. Thank you, Mr. Chairman. 

Ms. McGettigan, I know after the OPM breach there’s several 

months people were, kind of, notified. But I’ve had people, constituents, just wonder, I mean, what has been done to mitigate the potential damage to people whose files were compromised? 

Ms. MCGETTIGAN. Thank you for that question. 

We have entered into—in December, we entered into a contract 

and identity protection contract. We expanded the coverage that we 

already had. And we are moving toward having coverage for 10 

years. The current contract covers all those affected by the two 

breaches, and it runs out in December of 2018 during—— 

Mr. DESANTIS. What would that mean, just for somebody who 

had their stuff compromised? 

Ms. MCGETTIGAN. I’m sorry. We have identity protection services 

and credit monitoring. So people have received—people who were 

affected have received information on how to sign up for the credit 

monitoring, although they are covered by insurance whether they 

sign up or not. 

And currently, the ceiling on the insurance we have expanded to $5 million, and we are moving toward complying with congressional direction to have the contract go for 10 years of credit monitoring. 

Mr. DESANTIS. Okay. Good. I mean, I think that we in this committee—and I applaud the chairman for being on this issue. And 

we hear about these other hacks and stuff. This was catastrophic. 

I mean, you’re talking about these files with the amount of information that’s there, and I had to go through it in the military, and 

other people, perhaps, you guys have gone through it, too, there is 

a lot, a lot of information there, and it’s a massive vulnerability. 

So I hope that what’s being done is going to be effective. 

Let me ask—this may be Mr. Chase or maybe someone else want 

to take this. If OPM suffers another compromise and NBIB applications and its systems are breached, who makes the final call as to 

whether or not the compromised applications are taken offline or 

continue to run? 

Mr. HALVORSEN. If it’s in the new systems that are developed, 

that is me. 

Mr. DESANTIS. Do you agree with that? 

Mr. DEVRIES. For the new system, yes. Right now we’re currently 

operating underneath the existing legacy system. 

Mr. DESANTIS. What’s the answer—— 


KING-6430 with DISTILLER
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Mr. DEVRIES. The answer is the CIO gets the report of it from 

the CISO, and the director makes the call on it. 

Mr. DESANTIS. Okay. Let me ask you this, because the majority 

staff on this committee had a report indicating that there were certain tools following some of the previous breaches that were 

bought, and then they there were delayed in terms of their deployment for a variety of reasons, but one of them, that they had to 

make certain notification to relevant unions. 

So what kind of notifications is the IT security team required to 

make before deploying these tools, and what is the purpose of the 

notifications? 

Mr. CHASE. So from post breach coming in, any tool that we go 

out on the street to market and do our research on is fully vetted 

internally. We have a procurement office inside of OPM that works 

with us to make sure that the appropriate language is put into 

that, and then we move to the process of deploying that tool. 

Mr. DESANTIS. But in terms of the delays, have there been delays 

because of notification requirements? 

Mr. CHASE. I’m not aware of that specific statement. 

Mr. DESANTIS. Okay. Had there been other barriers or challenges 

in trying to timely deploy some of these tools, bureaucratic roadblocks? 

Mr. CHASE. Again, post breach, based on the situation—and, 

again, I mentioned earlier stabilizing, the procurement office has 

been very, very flexible with me and making sure that they can 

give us the time—— 

Mr. DESANTIS. But this was so—the implication is there may 

have been a problem prebreach? 

Mr. CHASE. I’m not aware outside of what I’m reading in those 

reports. 

Mr. DESANTIS. Do you think that it was a problem? 

Mr. DEVRIES. I have no firsthand knowledge of that, but just 

from the acquisition side and having been in this field for many 

years, yes. 

Mr. DESANTIS. Okay. 

Well, I will yield back the balance of my time. 

Chairman CHAFFETZ. I thank the gentleman. 

I now recognize the gentleman from Massachusetts, Mr. Lynch 

for 5 minutes. 

Mr. LYNCH. Thank you, Mr. Chairman. 

And I want to thank our witnesses for your great work and for 

your willingness to help us. I want to revisit the issue raised by 

Ms. Kelly about the unwillingness or the inability of the committee 

to really investigate what’s going on with the Russian hacking. 

But before I get into that, let’s talk a little bit about the issue 

that brings you here. 

In June and July of 2015, OPM publicly disclosed that its information technology systems had been experiencing massive data 

breaches over some time, compromising the Social Security numbers, birthdates, home addresses, background investigation records, 

and other highly sensitive personal information belonging to about 

22 million individuals. 

These cyber breaches were not only devastating in terms of their 

impact on the financial security of their victims, rather, they also 


KING-6430 with DISTILLER
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posed a grave national security threat as the extensive security 

clearance questionnaires, about an 80-page document, that really 

drills down on folks and was filled—were filled out by nearly 20 

million Americans who have security clearance rights and privileges, and the names and the information of those individuals were 

included among the data. 

I had asked—that was a—that was a terrible—you know, some 

people call that a—like a cyber Pearl Harbor, because all our folks 

who are actually actively interested in working on our national security organizations, you know, basically, they were giving up. And 

so I asked at a very basic level, I asked, Ms. Archuleta, who was 

running the OPM at the time, I said, have you actually gone back 

and encrypted the Social Security numbers of these employees? 

Were they encrypted? And she said, no, they were not. So—so all 

those Social Security numbers of those 22 million people went out. 

And then a year later, we had one of her successors—not her successor, but one of the people under her, I asked, again, have we 

encrypted the Social Security numbers of the people, the 22 million 

people? And they said there are still—there are still vulnerabilities 

we still haven’t been able to do that. 

So let me ask, have we encrypted at least the Social Security 

numbers of these 22 million people? 

Mr. DEVRIES. Sir, I’ll take that for the record. Yes, we have 

begun a vigorous program in 2016 to encrypt the databases. So it’s 

not just encrypting the Social Security number, but it is the databases that contain those critical information. 

Mr. LYNCH. Are we done with that yet? 

Mr. DEVRIES. We are not completely done across the whole OPM 

environment, but the HVA systems we have gone through, and I 

have one remaining system to be done, and that is scheduled for 

next month. To complete the—— 

Mr. LYNCH. What percentage of the 22 million have been 

encrypted? Can you give me an estimate on that? 

Mr. DEVRIES. Of the NBIB system, which contains those records 

there, all but one have been encrypted. 

Mr. LYNCH. So what’s lacking in percentage? 

Mr. DEVRIES. One major database there on the mainframe. 

Mr. LYNCH. All right. You’re not answering my question, but— 

look, we need to get that done. Okay? 

Let me go on to the Russian thing. Look, we’ve got—I understand that the chairman’s resistance on sources and methods, I get 

that. But we have—and I would like to introduce these into the 

record. 

First of all, I would like to introduce into the record my letter 

from December 15th—14th asking for a hearing on the Russian 

hacking. 

Secondly, I’d like to enter into the record an FBI investigation regarding Russian malicious cyber activity. They did a whole investigation on this. It’s called ‘‘grisly steppe,’’ s-t-e-p-p-e. I want to 

enter into the record a background to assessing Russian activities 

and intention into recent U.S. elections, the analytical process and 

cyber incident attribution. That’s produced by the offices of the director of National Intelligence. 


KING-6430 with DISTILLER
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I would like to submit for the record, a statement for the record, 

worldwide threat assessment by James R. Clapper, director of the 

National Intelligence, February 9, 2016. 

I ask for unanimous consent. 

Chairman CHAFFETZ. Without objection, so ordered. 

Mr. LYNCH. Thank you. So we have enough here. Just with this 

here, we have enough here to do an investigation. And this is just 

the stuff that is unclassified that the intelligence community has 

put out there. We don’t have to talk about—— 

Chairman CHAFFETZ. Will the gentleman yield? 

Mr. LYNCH. Yes. Sure I’ll yield. 

Chairman CHAFFETZ. Two points. Number one, sources and 

methods are the sole jurisdiction of the intelligence community. 

Number two, have you really thought this through? Do you really 

think it’s appropriate for this committee to investigate the specific 

hack of the DCCC? 

Mr. LYNCH. Absolutely. 

Chairman CHAFFETZ. Because if you are going to do an investigation of the DCCC, we’re going to have to dive into a political party’s 

infrastructure operation’s data. I don’t think that’s appropriate. If 

you—— 

Mr. LYNCH. Let me—well—— 

Chairman CHAFFETZ. Here’s the difference. Here’s the difference—— 

Mr. LYNCH. Reclaiming my time. Actually, you know, you’re 

using all my time here. 

Look, look they hacked—they hacked the American election. That 

is worth looking into—— 

Chairman CHAFFETZ. There’s no evidence of that. And President 

Obama said that that wasn’t even possible. 

Mr. LYNCH. This is high confidence. This is our own FBI, high 

confidence that they hacked the election, that they interfered with 

the election. It may not have been outcome determinative. I’m not 

saying that. But based on the FBI, based on the office of—the director of national security, they’re saying, yeah. And also, the CIA, 

they’re in agreement that the elections were hacked. 

Now, I’m not saying they affected the outcome, but they tried. It 

may have been just chaos that they wanted to create, but they 

interfered with our elections. And if we’re turning a blind eye to 

that, that’s a shame. That’s a shame. That’s core to our democracy. 

And look, if we’re just going to say, oh, that’s somebody’s work, 

that’s not anybody else’s work. That’s our work. There are plenty 

of reports here we can talk about, and we ought to do it publicly, 

about the damage done to the confidence in our electoral system. 

That’s what’s important here. 

People have to—people have to fear that we have an integrity— 

a certain integrity in our own systems and that other countries are 

not allowed to interfere with that. That’s a red line. We should not 

allow that. And it should be a very serious obligation of this committee to make sure that doesn’t happen again. 

And we need all the committees of jurisdiction to work on this. 

We’re a committee of unlimited jurisdiction. The gentleman has 

said that quite frequently. That’s the strength of this committee. 


KING-6430 with DISTILLER
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And I think this is—look, they hacked our election. This should be 

bipartisan. This should not be Democrat versus Republican. 

Chairman CHAFFETZ. The gentleman’s time—the gentleman’s 

time is well expired. 

As I said, I do think there should be—as I said when it happened, there should be an investigation. There should be a prosecution. They should go out—— 

Mr. LYNCH. These are the investigation of the committee. 

Chairman CHAFFETZ. Hold on. The gentleman’s time has expired. 

The Intelligence Committee is the only one that can look at 

sources and methods. That is the rule of the House. 

Mr. LYNCH. We won’t look at sources and methods. We’ll just 

look at what the agencies themselves have made public. 

Chairman CHAFFETZ. The gentleman’s time has expired. 

And if you are going to do a proper investigation, as this committee did, with the breach at the Office of Personnel Management, 

you have to look at the two sides of the breach, those that were 

trying to do it, which this committee could not look at in the OPM 

breach. Again, that is the purview of the House Intelligence Committee. 

But we could look at those that were breached and how inept 

their systems were and how bad it was set up and how the inspector general was warning of these things. That, we did do. 

Mr. LYNCH. We had nine separate investigations of Hillary Clinton, nine separate investigations—— 

Chairman CHAFFETZ. The gentleman’s—the gentleman is out of 

the order. The gentleman’s time is expired. I gave you well more 

than 5 minutes. 

What I think is inappropriate. And I’m trying to answer the 

question. It would be wholly inappropriate for the United States 

Congress, for us to dive into the DCCC. You might want to do an 

investigation yourself of the DCCC. I don’t think that the United 

States Congress should be diving into their individual private systems of a political party. I think that’s too broad—if you want me 

to start issuing subpoenas of the DCCC, I’m probably not going to 

do it, but go ahead and suggest it. 

Mr. LYNCH. How about some of the FBI—— 

Chairman CHAFFETZ. The gentleman’s time has expired. 

Mr. LYNCH. You asked me a question. 

Chairman CHAFFETZ. No, I did not. I did not. 

Mr. LYNCH. And I’m trying to respond. You asked me if I wanted—— 

Chairman CHAFFETZ. I did not ask—the gentleman is out of 

order. 

Mr. CUMMINGS. Would the chairman yield? Would the chairman 

yield? I think we need to calm down here a little bit. 

Mr. Chairman, you have made some statements, and I just ask 

you to give him the courtesy of a minute and a half just to respond. 

Chairman CHAFFETZ. No, I will not. I will not. 

Mr. CUMMINGS. Well, would the gentleman let me finish? Thank 

you. 

This has been an attack on our democracy, Mr. Chairman. And 

Mr. Lynch is one of our greatest members, and the passion that he 

has expressed is not limited to him, it’s to many Americans. They 


KING-6430 with DISTILLER
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feel as if all of our—the things that underpin our democracy have 

been attacked over and over again. 

And as I said yesterday, we keep saying we’re going to wait till 

certain things happen with President Trump. They are happening 

now. 

Chairman CHAFFETZ. Can I ask that—— 

Mr. CUMMINGS. And if the gentleman would just give me 30 more 

seconds. 

And all I was saying is I was hoping that in—I mean, as a courtesy to the gentleman, I just wanted him to be able to respond. 

Chairman CHAFFETZ. I’d like to ask you a question, if you don’t 

mind, to my ranking member. Does the ranking member believe 

that this committee should do an investigation of the DCCC? 

Mr. CUMMINGS. I think that we can look at certain things. I 

know I am very familiar with sources and methods, but I think 

what the gentleman is saying is let’s just look at the things that 

are—that are unclassified. And apparently, he has his reports in 

his hand, and we can see where we go from there. 

Number two, as I said before, in answering the chairman’s question, we have a bill that would—I think, would resolve this issue 

very nicely. 

I think the thing that I’m most concerned about, and I’m sure 

Mr. Lynch is concerned about is that we cannot just turn a blind 

eye to when we have 17 intelligence agencies who unanimously 

agree that there has been hacking with regard to our elections. 

And there seems to be—one of the things that I’ve noticed, this 

has been an effort, not by you, Mr. Chairman, but by others to say, 

okay. It didn’t affect the results. We don’t even have to get there. 

Forget it. I accept President Trump as my President. I’m looking 

forward to meeting with him next week. But, the idea that Russia 

could come in and interfere with our elections, all of us should be 

going berserk. I mean, we should be—I mean, just really, really 

upset. And so all I’m saying to you is that I think all the gentleman 

is saying, is he’s got documents that you’ve already entered into 

the record that are unclassified, want to look at those. Now, how 

far we can go is another thing. 

But, again, Mr. Chairman, you and I know what happened with 

the Benghazi Committee. Basically, it became a partisan fight. 

Chairman CHAFFETZ. I’ll—hold on. The gentleman’s time is expired here. You’re going well—you’re going well outside the scope 

of this—— 

Mr. CUMMINGS. No, I’m not. 

Chairman CHAFFETZ. Yes. Yes. 

Mr. CUMMINGS. I’m not and I would pray that you not do an Issa 

on me. 

Chairman CHAFFETZ. I’ve given you ample time. I’ve given you 

more time—— 

Mr. CUMMINGS. Don’t do an Issa on me, please. Don’t do that. 

Chairman CHAFFETZ. No. I’m asking you a simple question. I just 

want an answer to a simple question. If you don’t want to answer 

it, it’s fine. 

Mr. CUMMINGS. I’ve answered it. I’ve told you. 

Chairman CHAFFETZ. I’m going to ask one more time. 


KING-6430 with DISTILLER
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Mr. CUMMINGS. Yes. I’ve answered you. Okay? Yes. I just answered you. 

Chairman CHAFFETZ. I just wanted—— 

Mr. CUMMINGS. I just answered you. 

Chairman CHAFFETZ. Okay. I’m just saying—— 

Mr. CUMMINGS. You’re not listening. What I said was what the 

gentleman asked. All he asked—he said, take the unclassified information. Do not turn a blind eye to an attack on our electoral system. Let’s look—let’s go as far as we can. When you take it to the 

Intelligence Committee, what you’ve done is you’ve gotten Mr. 

Nunes, who is on the transition—who is on the transition committee for President Trump. 

And as much as I like him, I want—as the gentleman asks, he 

wants an investigation that will have integrity. And I—I appreciate 

integrity over and over again. Like I’ve said to you, Mr. Chairman, 

and to our committee members, when you deal with integrity and 

transparency, it’s like money in the bank. 

Mr. CUMMINGS. And so I would just ask you to just work with 

us and see what we can come up with. That’s all. 

Chairman CHAFFETZ. My last point. My last point. I don’t think 

it’s appropriate. I disagree with the attack on the integrity of the 

Intelligence Committee. I disagree with that. I think they are of integrity. I think Mr. Schiff and Mr. Nunes are men of integrity and 

they run that committee appropriately. And I’m sorry you don’t feel 

that way. 

Mr. CUMMINGS. I didn’t—now, see, now you done put something 

in my mouth. Let me be real clear. No, no, no, no, no. 

Chairman CHAFFETZ. I get to make my point. I’ll let you—— 

Mr. CUMMINGS. No, you said something that’s not accurate. What 

I said was—I’m not questioning the integrity of Mr. Nunes or Mr. 

Schiff. Mr. Schiff—both of them I have a lot of respect for. What 

I’m saying is what the gentleman said, is that we want a report— 

when people look at the situation—I’ll be very brief. When people 

look at the report and they see somebody on the transition team 

for Mr. Trump, then it becomes questionable. All I’m saying to you 

as to the world, we want—that’s why we filed the bill that we filed. 

And that’s why we’re asking for more like an independent investigation. That’s all. 

Chairman CHAFFETZ. Last point. Last point. Last point. And 

we’re going to recognize Mr. Meadows. We’ve gone way past the 

time here. 

Mr. CUMMINGS. Thank you. 

Chairman CHAFFETZ. And I ask this rhetorically. Do the Democrats truly want this committee to do an investigation of the DNC 

and the DCCC? 

Mr. LYNCH. Yes, we do. 

Chairman CHAFFETZ. Wow. Okay. We’re now going to recognize—— 

Mr. LYNCH. A lot of these emails, they’re already public. They’re 

already public. They leaked them. We already know what they are, 

those damaging ones. 

Chairman CHAFFETZ. Let’s recognize the gentleman from North 

Carolina, Mr. Meadows. 


KING-6430 with DISTILLER
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Mr. MEADOWS. Thank you, Mr. Chairman. We’re going to refocus 

on the focus of this hearing. I wish that we would have as much 

passion that is concerned about the well-being of the 22,000 people 

that got hacked, the potential security breaches that are there, instead of losing or winning an election. I wish we’d have as much 

passion about that. Let’s start to focus on the real aspects of what 

we need to be doing. 

There are other hacks with the IRS. Let’s focus on the hardworking American taxpayers. You know, I’m sick and tired of hearing the repeated talking points over and over again. There is no 

one who will work in a more bipartisan way to get to the truth 

than me. But I disapprove of the talking points that continue to get 

repeated to undermine the credibility of a duly elected President. 

Mr. CUMMINGS. Will the gentleman yield? 

Mr. MEADOWS. No, I will not. 

Let me go into this particular issue. When we’re looking at this, 

you mention that you have 100 percent dual authentication 

throughout the system. Is that correct? 

Ms. MCGETTIGAN. Yes, sir. That’s my understanding. Yes, sir. 

Mr. MEADOWS. All right. And you’re filling some very big shoes. 

I happen to be a fan of Ms. Cobert. She actually—we come from 

very different sides of the aisle, but she was always very responsive 

to this committee and to me personally. And so I want to make 

sure that we can clarify, perhaps, your testimony. Because the 100 

percent dual authentication is really just at the front door. Is it 

not? Because we have indications from the IG that there is still a 

whole lot within the system, that if they get in the front door, that 

only 2 of 46 systems inside would require that. Is that your understanding? You may want to refer—I think the CIO wants to jump 

in here. 

Ms. MCGETTIGAN. I think I will defer to Mr. DeVries. 

Mr. DEVRIES. Thank you, sir. 

Ms. MCGETTIGAN. Thank you. 

Mr. DEVRIES. Sir, we have multifactual authentication in there 

for the users, the standard users who come onto the network. That 

is correct, 100 percent to get onto the networks, they require 

their—— 

Mr. MEADOWS. But once in—— 

Mr. DEVRIES. No, once they get in, they are still then authorized—their access is based upon those attributes and their roles of 

what they’re assigned to. So they’re not given—— 

Mr. MEADOWS. So how do you respond to the IG that said only 

2 of 46 systems would actually, of the major applications, would require PIV authentication? Is that not accurate? 

Mr. DEVRIES. I’d like to go back and look at that. I’ll defer to my 

CISO here, but that is—that does not ring true to how we—— 

Mr. MEADOWS. Because this isn’t my first rodeo. I’ve been here 

with a number of folks. In fact, I called for the resignation of the 

OPM director when there were similar terms that I’m hearing 

today that give me concern that we’re making progress. And I 

guess, how do we define success? At what point will we have all 

the major applications? And Mr. Lynch talked about the 

encryption. 

Mr. DEVRIES. Correct. 


KING-6430 with DISTILLER
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Mr. MEADOWS. Now, we’ve been promised encryption over and 

over and over again. And yet even today, we’re not there with—so 

are all the Social Security numbers encrypted today? 

Mr. DEVRIES. No, sir. 

Mr. MEADOWS. Okay. When will they be encrypted? 

Mr. DEVRIES. But I have—— 

Mr. MEADOWS. Just timeframe. When will they be encrypted, all 

the Social Security numbers? I mean, that’s basic. I’ve got 

encryption better than that on my home computer, and here we 

are, we have—is it a lack of resources? 

Mr. DEVRIES. Sir, it was somewhat due to that and also schedule 

change here on the mainframe. That’s the only one that is—that 

was delayed. And I’ve reenergized that one back in there. That is 

2017. 

Mr. MEADOWS. So when is it going to be done? 

Mr. DEVRIES. End of 2017, sir. 

Mr. MEADOWS. And so we will have everything encrypted by the 

end of 2017. Fiscal year? 

Mr. DEVRIES. The HVA system, the high value assets, which includes the Social Security numbers and so forth, will be encrypted 

this year. Yes. 

Mr. MEADOWS. All right. In terms of segmentation, how do you 

segment a legacy system? Either one of you can answer it. 

Mr. CHASE. So, again, as a part of our strategy, we looked at all 

the systems and all the IT system inventories that we had out 

there. We determined which ones—— 

Mr. MEADOWS. So are you going from a zero trust? 

Mr. CHASE. That’s the idea, is to use that zero trust tenet. Absolutely. 

Mr. MEADOWS. So you rushed into the fire—— 

Mr. CHASE. Ran into it, sir. 

Mr. MEADOWS. —and so as you ran into the fire, you decided 

from a zero trust aspect that you’re going to look at every single 

system. 

Mr. CHASE. Absolutely. 

Mr. MEADOWS. All right. So we can tell all of those employees or 

potential employees or those who have had their personal life history looked at that by the end of 2017, that you have great assurance that we have the most up-to-date, sophisticated cybersecurity 

protection that they will ever see and it will be segmented in a way 

that if somebody gets in the front door, that they won’t be able to 

go through the whole system. Is that correct? 

Mr. CHASE. That is correct. And there’s also many, many compensating controls that reside in the network. So we have our network analysis tool, we have our data loss prevention tool. We have 

malware detection tools. And then we actually have a 24/7 security 

operation center that is on glass watching for those events to come 

through. 

Mr. MEADOWS. I yield back. I thank the chairman. 

Chairman CHAFFETZ. I thank the gentleman. 

I will now recognize the gentlewoman from Florida, Mrs. 

Demings, for 5 minutes. 

Mrs. DEMINGS. Thank you, Mr. Chairman. 


KING-6430 with DISTILLER
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I want to say good morning to all of you and thank you for being 

here. Before I get into my question, I feel compelled to make this 

comment. I spent 27 years in law enforcement. I served as the chief 

of police. So I am very concerned about the issue that we’re discussing today. Security breaches of any kind, I believe, deserve 

every bit of attention and every bit of passion. I’ve been here a little shy of a month, but what I did not sign up for is what I believe 

was the blatant disrespect that was displayed to each other by my 

colleagues. And so I believe if we’re going to solve our Nation’s 

problems, civility has to be at the center of it. 

And with my question, Director Phalen, last November, the New 

York Times and other media outlets reported that while meeting 

with the Prime Minister of Japan, then President-elect Trump allowed his daughter and son-in-law to sit in during all or part of the 

meeting. In reporting about this meeting, the Times found, and I 

quote, ‘‘That anyone present for such a conversation between two 

heads of state should, at a minimum, have security clearance. 

What we do not—we do not know whether President Trump has 

stopped this practice of allowing family members who do not have 

security clearances from attending meetings with dignitaries and 

other foreign officials.’’ 

Director, I ask you, what are the security risks for having individuals who do not have the appropriate security clearances 

present during classified meetings or briefings? Thank you very 

much. 

Mr. PHALEN. Thank you, Representative. Thank you for the question. The determination as to whether an individual has a security 

clearance is left to the head of the agency with whom they are employed or otherwise contracted with. And, of course, the situation 

between a President-elect and the President is a different situation. 

The President has the ability to grant a clearance or grant access 

to classified information to anyone who they please. It is at their 

discretion. 

And the—I am not aware of any of the details around the meeting that occurred with the leadership of Japan. I just don’t know 

any of the details about that, whether anything of classified nature 

was discussed or not. But it would—in the current situation, it 

would be the President’s discretion to allow individuals even without clearances to know or have access to classified information. 

Mrs. DEMINGS. So each department would make that determination. Is that what you said? There are no basic general guidelines 

for persons to have security clearances in certain situations or positions? 

Mr. PHALEN. There are general guidelines and there are—specifically, there are investigative standards which we follow when conducting an investigation. The agency who ultimately grants the 

clearance follows an adjudication set of guidelines, what are the 

key factors that one would look at when making a determination 

whether this individual is eligible or should be eligible to receive 

classified information. And then as a separate act, the agency 

then—if the answer’s affirmative, they are eligible, the agency 

would make a determination as to whether to actually brief them 

into a national security program or not, give them that clearance. 

Mrs. DEMINGS. Okay. Thank you very much. 


KING-6430 with DISTILLER
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Chairman CHAFFETZ. Does the gentlewoman—— 

Mr. CONNOLLY. Would—— 

Chairman CHAFFETZ. Does the gentlewoman yield back? 

Mr. CONNOLLY. Would my friend yield? 

Mrs. DEMINGS. I yield. I’m sorry. Thank you. I yield. 

Chairman CHAFFETZ. She’s yielding. To Mr. Connolly or—— 

Mr. CONNOLLY. To Mr. Cummings. 

Ms. DEMINGS. To Mr. Cummings. 

Mr. CUMMINGS. I just wanted to let Mr. Meadows know, when I 

asked you to yield, the only thing I was going to say is before you 

got here, and I will share this with you, in my opening statement, 

I talked about all the efforts that we have made in this committee 

with regard to the other breaches. I listed them one by one, all the 

many things that we’ve done. And I said it in a way that—because 

President Trump has said that we suddenly got excited about the 

Russian hacking. But I laid it out. And again, I will share my opening—it was a courtesy to you, because I didn’t want anybody to 

think that this is something new to us. 

We’ve spent, in a bipartisan way, hours upon hours upon hours 

upon hours trying to deal with these. And I give the credit—give 

a lot of credit to the chairman. And that’s all I was tying to tell 

you. 

Mr. MEADOWS. Will the gentleman yield? 

Mr. CUMMINGS. And I didn’t want the public to be left with the 

impression that we haven’t been working on these acts. Every single time. 

Mr. MEADOWS. Will the gentlemen yield? 

Mr. CUMMINGS. Of course. I only have—— 

Chairman CHAFFETZ. It’s the gentlewoman’s time. 

Mr. MEADOWS. Will the gentlewoman yield for just a comment? 

A nice comment. 

Mrs. DEMINGS. Yes. Yes. Certainly. Please, Mr. Meadows. 

Mr. CONNOLLY. We’ll be the judge of that. 

Mr. MEADOWS. The gentleman from Maryland is a good friend, 

and a trusted one. And in the passion of my not yielding back to 

him, I don’t want anything to be inferred about our relationship 

and our willingness to work in a bipartisan way. And I apologize 

for my passion in not yielding. But I also want to stress that our 

friendship and our willingness to get to the bottom line of it is 

unyielding and unchanging. And I thank the gentlewoman. 

Chairman CHAFFETZ. The gentlewoman yields back. 

We’ll now recognize the gentleman from Ohio, Mr. Jordan, for 5 

minutes. 

Mr. JORDAN. I thank the chairman. 

Mr. Halvorsen, you are the chief information officer for the entire 

Department of Defense? 

Mr. HALVORSEN. That is correct. 

Mr. JORDAN. And in your testimony, your written testimony, you 

said that, ‘‘DOD CIO is responsible for all matters relating to the 

Department of Defense information enterprise, including 

cybersecurity for the Department. In this capacity, DOD CIO is responsible for oversight of the Department’s efforts to design, build, 

operate, secure, defend a new IT system to support the background 

investigative processes for the NBIB.’’ Is that all accurate? 


KING-6430 with DISTILLER
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Mr. HALVORSEN. It is. 

Mr. JORDAN. Okay. Are you familiar, then, with the December 6 

Washington Post story, front page, Pentagon Hid Study Revealing 

$125 Billion in Waste? Are you familiar with that article? 

Mr. HALVORSEN. I am familiar with that article. 

Mr. JORDAN. Do you—well, let me ask you—let me go back and 

ask you this: Do you have the resources you need to do everything 

I just read in your testimony, help NBIB which has 100 Federal 

agencies that’s got to make decisions about—regarding individuals 

who work there and everything at the Department, do you have the 

resources you need to do your job? 

Mr. HALVORSEN. We have the resources to make sure that we develop and design an NBIB new system that is secure and can attack and defend the data. 

Mr. JORDAN. And so you think you got adequate resources to do 

everything you’re tasked to do. 

Mr. HALVORSEN. I think I have adequate resources to everything 

I’m tasked to do specific to this NBIB issue. 

Mr. JORDAN. But not overall? Is that what you’re saying? 

Mr. HALVORSEN. Well, I don’t think anybody here would say they 

have all of the resources—— 

Mr. JORDAN. You always want more. I get that. But you are familiar with the story that was on the front page of the Washington 

Post last month, or 2 months ago? 

Mr. HALVORSEN. I am. 

Mr. JORDAN. And the findings of the McKinsey & Company study, $125 billion in waste at the Pentagon, do you agree with 

that—those findings? Or, I mean, they talked about as many fulltime employees in back office personnel and in purchasing bureaucracy, as many employees there as we actually have—almost as 

many people there as we have in troops in the field or troops in 

total. Do you agree with what you know about that study? 

Mr. HALVORSEN. We were—do I personally agree with that 

study? I do not. Is that the reason I’m here to testify? No. So if you 

want more data on that, I will take any questions you have for the 

record. 

Mr. JORDAN. Okay. Were you—were you interviewed or talked to 

in the course of the study by McKinsey & Company? Did they talk 

to you? 

Mr. HALVORSEN. I have talked to McKinsey & Company, yes. 

Mr. JORDAN. Multiple times? I mean, I’m just kind of curious. 

Mr. HALVORSEN. For the study, I believe once. But I’ll get that 

confirmed. But I have talked to McKinsey in the course of my business. 

Mr. JORDAN. The article reports here on the front page here 

above the fold, the report issued in January 2015 identified a, 

quote, ‘‘clear path for the Defense Department to save $125 billion 

over 5 years.’’ I think this is important too. What the study said, 

what the article reports that the study said was that this savings 

in bureaucracy waste and other areas is money that could go into 

weapon systems and our troops. Frankly, where I think most 

Americans would want their tax dollars and resources to go. 

The article continues, ‘‘The plan would not have required layoffs 

of civil servants or reductions in military personnel. Instead it 


KING-6430 with DISTILLER
35 

would have streamlined the bureaucracy through attrition and 

early retirements, curtailed high priced contractors,’’ and the last 

clause says, ‘‘and made better use of information technology.’’ 

Do you have any idea what they’re referring to there, make better use of information technology? 

Mr. HALVORSEN. Yeah, I do. I mean, if you’re asking me do we 

think we could do better with information technology, I think I testified in numerous hearings that do I believe we should continue 

to adopt best commercial practices? Should we bring more commercial systems on into DOD and other government? I said we should. 

I believe there are ways to reduce some money in our IT business. 

Do I think that number is correct, personally? I do not. 

Mr. JORDAN. So a little bit ago you said you didn’t agree with the 

study. Now you sound like you do agree with a lot of parts of the 

study. 

Mr. HALVORSEN. No. 

Mr. JORDAN. Is it both or—— 

Mr. HALVORSEN. No. I said I agree that there are efficiencies to 

be found in the IT systems. By doing what we are doing, I think 

we will achieve some. I do not think the numbers in the study, my 

personal opinion, they’re not correct. I will take any more questions 

you have—— 

Mr. JORDAN. So you think the $125 billion number is a little 

high. Would you hazard a guess at what kind of savings taxpayers 

could see if part of what McKinsey found in their study was implemented and how we could better get money to weapon systems and 

to troops? 

Mr. HALVORSEN. No, I will not hazard a guess. 

Mr. JORDAN. Okay. Mr. Chairman, I just think this is an important area where we need to—I know it’s not the sole focus of and 

not the primary focus, I should say, of this hearing today, but this 

is an area we need to study. If we can get more money into upgraded weapon systems and to our troops, and if we got this potential of waste, even the chief information officer says there’s some 

waste there. Maybe not to the degree that the article reports, but 

certainly any we can find and savings we can find I think makes 

sense. 

With that I yield back. 

Chairman CHAFFETZ. Thank you. Point well taken. 

I now recognize the gentleman from Maryland, Mr. Raskin, for 

5 minutes. 

Mr. RASKIN. Mr. Chairman, thank you very much. 

I wanted to start actually by responding, Mr. Chairman, to the 

question that you posed about whether or not the Democratic National Committee would be a proper object for inquiry and investigation by this committee. And my first reaction to it, I think, was 

sympathetic to you, which is no, not really, because it’s not part of 

the government. It’s a private entity for most purposes. When you 

think about the Democratic National Convention, where it’s going 

to be located, who’s going to speak at it, that’s a private matter. 

It’s a private association. 

On the other hand, it struck me that the Supreme Court has said 

that political parties are public instrumentalities capable of State 

action for certain purposes. So when you go back and look at Smith 


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v. Allwright, Terry v. Adams, the white primary line of cases, the 

Supreme Court said a political party could not exclude from participation people based on race. So the Equal Protection Clause applied directly to political parties, that they were not private entities 

for those purposes. They were public instrumentalities. 

And in lots of other cases, the Supreme Court has treated political parties as public instrumentalities and kind of public carriers 

for the purposes of effective action in democracy. And I think if you 

look at it from a global perspective, that is the role that political 

parties play. The DNC, the RNC, they are organizing political activity for tens or hundreds of millions of people. And so if they are 

cyber vulnerable, I think it makes the whole country cyber vulnerable, and then it casts a cloud over democratic government itself. 

So that’s why, in the end, I think it is a complicated question you 

raise, but I would side with the ranking member and with the 

other members who were speaking on this side of it. 

Let me pose a question. As a new member of this committee who 

was—I was not here for the original OPM breach, and so all of this 

is a bit new to me. But I want to ask the question. We know from 

the national intelligence community about the fact that they believed with high confidence that there was an organized campaign 

by Russia to subvert the 2016 election and to compromise the 2016 

election. I’ve also heard that there’s certain other countries where 

certain kinds of hacking are common or concentrated, like Nigeria, 

apparently, is a place where there’s a lot of cyber hacking and 

phishing attacks going on. 

Do you have a list of the most common enemies or culprits of our 

cybersecurity that you use? And I know, Ms. McGettigan, if that’s 

something you can answer. 

Ms. MCGETTIGAN. I’ll defer to Mr. DeVries to answer that. 

Mr. DEVRIES. Member, if I could—— 

Mr. RASKIN. Please. 

Mr. DEVRIES. If I could, I would like to defer to Mr. Chase here 

for the expertise on it. We do have the network monitoring, but we 

are part of the greater ecosystem of that from DHS. 

Mr. RASKIN. All right. Let’s cut to the chase. 

Mr. CHASE. Thank you. No pun intended. 

So one of the things that I just want to make clear is we’re a 

customer service oriented agency. And so we rely on our partners 

from Department of Homeland Security, FBI, and other components within DOD. The potential attribution or the knowing of a 

bad actor is not our job. My job is to focus the staff at OPM to protect the data that resides in there. 

Mr. RASKIN. Okay. So I guess—right. You’re a customer service 

agency and you want to serve the various government agencies 

that interact with you. The problem, of course, is now we’ve got 

these outside entities that are trying to invade and undermine and 

so on. Do we know who those entities are? Is there like an FBI 

most wanted list of the cyber saboteurs all over the world or in this 

country? I mean, the national intelligence community tells us it’s 

Russia, but then we hear from other people, no, it’s a fat guy on 

a couch someplace. I don’t know why it’s always a fat guy. Why 

couldn’t it be a skinny guy on a couch. But anyway, it might be 

a guy on a couch or it might be Russia, but it might be Nigeria. 


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Where it is coming from? And does that list exist? And is there any 

attempt to really get to the bottom of it? 

Mr. CHASE. And, again, I’ll try to answer more directly. So DHS 

and FBI provide those reports in unclassified and classified formats. 

Mr. RASKIN. Okay. Do you believe as experts in the field that 

there is going to be a technological answer to this so we can actually create a secure cyber environment? Or, you know, is this a Sisyphean task? We go up two steps and we fall back three steps. I 

mean, are we really—is it an uphill fight, I guess is what I’m asking. Mr. Halvorsen. 

Mr. HALVORSEN. Right now it is an uphill fight. I do believe technology will get us some of the solutions. But I think this is much 

like any area in technology. We will make strides forward. The people who want to use technology for bad will make strides forward. 

And it will be a continuing analysis and engagement that is not 

going to end anytime soon. 

Mr. RASKIN. Thank you very much, Mr. Chairman. I yield back. 

Chairman CHAFFETZ. I thank the gentleman. 

We’ll now recognize Mr. Comer who’s new to our committee. 

We’re pleased to have him here. The gentleman from Kentucky. 

Mr. COMER. Thank you, Mr. Chairman. 

Chairman CHAFFETZ. Sorry. The microphone button there. Talk 

button. There we go. 

Mr. COMER. Thank you, Mr. Chairman. 

My question is for Mr. DeVries. Sir, I would like to follow up 

with you on the IT infrastructure project that OPM abandoned last 

year. The committee’s understanding is that you are no longer leasing two new data centers for OPM’s new IT environment, but rather, are repurposing the hardware and equipment meant for the IT 

environment that the contractor Imperatis built. My question is, is 

this accurate? 

Mr. DEVRIES. Yes, sir it is. 

Mr. COMER. Okay. How much did OPM pay the contractor for the 

new IT infrastructure project before terminating the contract May 

2016? 

Mr. DEVRIES. Sir, I would have to get back to you with the exact 

amount that was consumed there. I do not have that number with 

me today here. 

Mr. COMER. Why was the contract terminated? 

Mr. DEVRIES. Sir, as I completed my assessments coming on 

board as the CIO, that effort was to build a new infrastructure to 

move the legacy stuff into. They went out on the contract. That 

contractor went out of business. They did not show up to work in 

May, and we terminated the contract after that. We then repositioned the equipment back in because we had purchased that, as 

we had purchased the design and engineering diagrams. We have 

what we paid for. Now just turning it back on. 

Mr. COMER. It’s my understanding that the first two phases of that were completed, and after approximately $45 million of investment, OPM abandoned the project. But you say that we have what 

we paid for or did we lose what we paid for? 

Mr. DEVRIES. Sir, we have evolved that, and I’m now building on 

that capability that we purchased then. Yes, sir. 


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Mr. COMER. So is OPM still operating the legacy IT environment? Is that correct? 

Mr. DEVRIES. Sir, I will say no. We have evolved a lot over the 

past year, and that was part of my assessment coming onboard was 

to take a look at what the network was, where are our high value 

assets, where are our centers of gravity, if you will, and what’s the 

protection there. Mr. Chase has talked about some of the defense 

and depth that we’ve put in place. So it is not the same legacy infrastructure that it was in 2015. Not by a long shot. 

Mr. COMER. So are we—can we be assured that this environment 

is more secure today than prior to the data breaches? 

Mr. DEVRIES. Absolutely. Mr. Chase and I would not be here if 

it was not. 

Mr. COMER. Okay. I yield back. 

Chairman CHAFFETZ. I thank the gentleman. 

We’ll now recognize the gentlewoman from the Virgin Islands, 

Ms. Plaskett, for 5 minutes. 

Ms. PLASKETT. Thank you, Mr. Chairman. And thank you all for 

being here this morning to testify. 

I wanted to—I appreciated your testimony this morning on all of 

the topics. And it seems to be very wide ranging, of the discussion 

that we’re having this morning. But we are all here because protecting our Nation’s security from insider threats and external 

threats is of paramount importance, of course, to you all and us as 

Members of Congress. So I wanted to discuss the security clearance 

process and how individuals are granted access to sensitive information. 

Director Phalen, for you specifically, how would NBIB handle the 

clearance process for someone under active FBI investigation? 

What happens with that application? 

Mr. PHALEN. When an agency puts an individual in for a clearance, it starts with a determination by that agency that this individual needs a clearance for whatever work they’re going to be 

doing. The individual’s information is sent to NBIB or to some 

other—— 

Ms. PLASKETT. And what if you find out that the person is under 

active FBI investigation? What happens at that point? 

Mr. PHALEN. If we in the process of conducting the investigation 

determine an individual’s under active investigation, we would notify the requester of what we understand to be the investigation, 

and we would continue the—our part of the investigation, unless 

we were told to stop based on some decision by the requester. 

Ms. PLASKETT. Now, in knowing that you’re going to continue the 

investigation of someone who is under an active FBI investigation, 

would that be one of the factors in disqualifying an individual from 

a security clearance? 

Mr. PHALEN. Not necessarily. And it would not be our determination. It would be the determination of the requesting agency, who 

is either the requesting agent themselves, if they have independent 

adjudication authority, or the—in the DOD world, the consolidated 

adjudication facility. These are the individuals that make the ultimate determination as to whether an individual is eligible for access to—— 


KING-6430 with DISTILLER
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Ms. PLASKETT. Got you. So you’re processing the application, 

you’re giving them the information, and then the agency head then 

makes the determination whether or not the person has the security clearance? 

Mr. PHALEN. Ultimately, yes. 

Ms. PLASKETT. So for the ultimate decisionmaker for granting a 

security clearance for a senior White House staffer, who would that 

person be? 

Mr. PHALEN. The chief of the White House Security Office is the 

adjudication authority. 

Ms. PLASKETT. And so the chief of the security office for the 

White House is the determiner for an individual in the senior 

White House level having a security clearance. 

Mr. PHALEN. Yes. 

Ms. PLASKETT. And who places that person in that office? The 

chief officer. Is that an independent? Is that appointed by the 

President? Is that a career person? Who is that individual? 

Mr. PHALEN. I actually don’t know right now. I can find that answer—— 

Ms. PLASKETT. I would really love to know that answer. Because 

is it possible for the ultimate decisionmaker to make a decision to 

grant an individual a national security clearance if the person is 

under an FBI investigation? You’re saying yes, that’s possible. 

Mr. PHALEN. It is possible. 

Ms. PLASKETT. And the reason I’m asking that is because of 

course—you know, of course there’s a reason I’m asking. Right? 

There would—according to multiple reports, several members of 

the Trump campaign and incoming Trump administration may currently be under FBI investigation for their connections with the 

Russians; the very country implicated in the hacking that everyone 

seems to be interested in here today. 

So President Trump’s National Security Adviser, Michael Flynn, 

is reportedly being investigated by the FBI for phone calls with a 

Russian diplomat. And the New York Times reported that the 

FBI’s investigating communication and financial transactions between Russia and the former campaign manager, Paul Manafort. 

So my question is, if these individuals become now senior White 

House staffers who need security clearance as having sit on this 

National Security Council, along with Steve Bannon, if those individuals are under FBI investigation, they may still get a national 

security clearance? 

Mr. PHALEN. That is certainly possibly. And I would distinguish 

between someone who is under investigation and someone who has 

been charged or convicted with a crime. 

Ms. PLASKETT. Of course. As a lawyer, I know you’re innocent 

until proven guilty. But an active FBI investigation would raise 

some eyebrows. Would it not? Because the FBI would not begin an 

investigation on my, you know, freshman student who has cheated 

on a test or something. They usually start FBI investigations for 

pretty serious things. 

Mr. PHALEN. It would be a noteworthy item on an adjudication, 

yes. 

Ms. PLASKETT. Okay. Mr. Chairman, I think we need the answer 

to some of the questions that we’ve been asking here. 


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And so do you know, Director Phalen, which or any of the senior 

White House staffers who have access to senior material are under 

criminal investigation by the FBI? 

Mr. PHALEN. I do not know that, no. 

Ms. PLASKETT. Okay. Thank you. 

Chairman CHAFFETZ. If the gentlewoman yields back, Ms. 

McGettigan, she is the acting director of OPM, if you could get 

back to Ms. Plaskett about who specifically is in charge, I think the 

gentlewoman asked a reasonable question here, who are the people 

that make those determinations, and get back to—will you make 

that commitment—— 

Ms. MCGETTIGAN. Yes, we will. 

Chairman CHAFFETZ. —that you’ll get back to her? 

Ms. MCGETTIGAN. We will get back to you. 

Chairman CHAFFETZ. Okay. 

Ms. PLASKETT. Thank you. Thank you very much, Mr. Chairman. 

As well if you would find out how do we find out—— 

Chairman CHAFFETZ. Ask her. 

Ms. PLASKETT. It would be great to know in that process, one, 

who the decisionmaker is, and is there a list of individuals who are 

under FBI investigation. If the chairman and the ranking member 

would receive that, that would be very helpful in making that determination, what are the factors. 

Ms. MCGETTIGAN. Okay. 

Ms. PLASKETT. Thank you. 

Ms. MCGETTIGAN. We will follow up. Thank you. 

Chairman CHAFFETZ. And I would open up to any member, if 

they have questions for OPM, Ms. McGettigan is the acting director. 

Mr. CONNOLLY. Mr. Chairman, I just—I assume at some point 

Ms. McGettigan’s going to actually answer a question as opposed 

to always getting back to us. 

Chairman CHAFFETZ. Okay. She wasn’t ever even asked a question in that series, so I think that’s a little inappropriate. But let 

me—and she did make a commitment to get back to the committee. 

I think that’s reasonable. 

Mr. CONNOLLY. Yes, I heard. 

Chairman CHAFFETZ. So I’ll now recognize myself for 5 minutes. 

And I guess this question will go to Mr. Chase. Tell me about the 

authority to operate. There have been some questions about this in 

the past. The inspector general found that the authorities to operate were a material weakness in fiscal year 2016. The IG reported 

that 18 major systems still did not have current authorities to operate in place. What is the current state of those ATOs? 

Mr. CHASE. So all the ATOs—— 

Chairman CHAFFETZ. If you can move that microphone a little 

closer. I apologize, sir. 

Mr. CHASE. So all the ATOs are currently compliant. 

Chairman CHAFFETZ. Can you put some meat on the bones? Define that for us. 

Mr. CHASE. So in fiscal year 2016, again, our strategy was to 

identify and understand all the systems. It was identified that 

quite a few of them were out of compliance. So we took on two 

major initiatives at OPM. One was a sprint in February of 2016 to 


KING-6430 with DISTILLER
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look at all the systems, to include the HVAs, to ensure the best 

pathway forward to get them compliant. The next phase of that 

was marketing within OPM and the agency heads and the acting 

director at the time to ensure that everybody in the agency knew 

the importance to get everybody into compliance. 

Chairman CHAFFETZ. Would the ATO—you said all of them. 

Would that include the PIPs? 

Mr. CHASE. That is correct, sir. 

Chairman CHAFFETZ. It would. Okay. 

Mr. CHASE. That was not reflected in the fiscal year 2016 FISMA 

report, and has been recently. 

Chairman CHAFFETZ. Everything within the NBIB, do those all 

have current valid ATOs? 

Mr. CHASE. Yes, sir. 

Chairman CHAFFETZ. Okay. Let me switch over here, if we could, 

to Ms. McGettigan and—or maybe, Mr. Phalen, you might be the 

right person—actually, let me ask you, Mr. Phalen. What is the 

current state of the ability to look at the social media? We’ve been 

talking in this committee over the last couple of years, actually, 

with OPM about during background check investigations looking at 

social media. What are you doing or not doing in that process? 

Mr. PHALEN. Thank you, Mr. Chairman. Two points to make on 

that. Number one, in April of 2016, the security executive agent 

sent out a directive that would allow us—allow an investigation to 

use social media publicly available on electronic information in 

order to inform an investigation. We at NBIB or its predecessor, 

the Federal Investigative Service, have been using on a targeted 

basis social media inquiries to help resolve issues when they come 

up during an investigation. We are in the middle of a short pilot 

to understand how we can incorporate it into a formal—into a more 

consistent use during an investigation. 

In other words, how do we collect the information, get it 

disambiguated, and make sure it is accurate and of any value, and 

then provide it to an investigator who is in the field conducting an 

investigation to help enhance that. 

Chairman CHAFFETZ. Can you define ‘‘short pilot?’’ Because I 

think we’ve been talking about this for a couple years. And this 

doesn’t seem to be very short. 

Mr. PHALEN. So a number of pilots have been conducted by a 

number of agencies to look at the value of social media. And most 

concluded—most have reached the similar conclusion, there can be 

valuable information in collecting social media. 

Chairman CHAFFETZ. Okay. Can you just hold on here. This is 

what drives people crazy about government. You had to conduct a 

study to find out if looking at social media would be valuable? And 

the conclusion is it might be yes? Come on. Every single time 

there’s a terrorist attack, what’s the very first thing the investigative body does? They go look at their social media. And more often 

than not, they say, oh, my goodness. If somebody had just looked 

at this. 

Why in the world do we need—we’re still doing a pilot? Let me 

answer the question for you. Yes. Looking at publicly available social media should be part of the background check. It’s a joke to 

think that you’re not looking at social media. And the idea that we 


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even have to think about this, by its very definition, it is social. It 

is open. It’s there. Facebook. You can go—come on. Instagram. 

Twitter. Every single time we go and do an interview for somebody, 

we go check their social media. Why do you have to do another 

pilot? 

Mr. PHALEN. The pilot was not to determine whether or not 

there’s any value in social media. The pilot that we are currently 

running is how do we incorporate it into a standard background investigative process. And the largest pole in this tent here is not can 

we collect the information. It is not is there going to be valuable 

information in there. It becomes how does it get incorporated in a 

manner that is cost effective to our customer base. And—because 

the collection is the easy part. The analysis of it becomes harder. 

And the more data that’s out there, the more difficult the analysis 

becomes. 

I believe that this is a relevant data source. We believe it is a 

relevant data source. We’re going to continue to exploit it. This 

pilot was a very short one to determine how we can build it into 

an—our current investigative process. And as we move down the 

road, how it will become more of a mainstay for this investigative 

process. 

Chairman CHAFFETZ. Have you considered implementing a policy 

to require the disclosure of online user names or social media identities as part of the clearance process? 

Mr. PHALEN. We have not at this point. 

Chairman CHAFFETZ. Why not? 

Mr. PHALEN. That would be a decision to be made by the security 

executive agent to ask for that information. 

Chairman CHAFFETZ. Here’s my personal take on this, and then 

we’ll go to Mr. Connolly. The United States of America, the people 

of the United States of America, are about to entrust somebody 

with a security clearance that allows that individual to look at and 

understand information that the rest of the public doesn’t get to 

look at. Right? That is the very nature of a security clearance. 

We’re doing this, we’re giving this person special privileges because 

we trust them. 

I would think it would be reasonable that in return for that—you 

don’t have to apply or try to get a job with a security clearance. 

There’s nobody that forces you to do that. It’s optional. But you 

would think in return for that they would say: Yes. Here’s my 

Instagram account. And I would go so far to say: Here’s my password if you want to go look at my private Instagram. That is a reasonable thing to look at when you’re trying to go back and do a 

background check. 

Some of these background checks are so thorough. You’re looking 

at bank records. You’re looking at education. You’re interviewing 

neighbors. You’re talking and trying to figure out as much as you 

can about this information. A very costly, expensive, laborious process. And yet we’re not even—we’re so bashful we won’t even say: 

We’re going to be looking at your Instagram. Is that okay, you 

know? And if it’s not, then maybe we shouldn’t be giving them a 

security clearance. That’s my take on it. 

It’s very frustrating this takes so long. Because every time we 

have a problem, what’s the very first thing the FBI and other law 


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enforcement want to do? They want to dive into their social media. 

That’s the best way for them to figure out what has been going, 

what is the attitude, who are they communicating with. And if 

we’re going to give a security clearance, it seems reasonable. 

I’m past my time. I’ll now recognize the gentleman from Virginia, 

Mr. Connolly. 

Mr. CONNOLLY. I thank the chair. I also would say to the chair, 

I caution him, I don’t think it’s appropriate for him to characterize 

an intervention or a question by a member of this committee. I 

don’t do that to him. And I expect him not to do it to me. And if 

we’re going to get into that, two can play the game. 

Ms. McGettigan, a question maybe you can answer. OPM, is it 

going to migrate to the required XML format, the transaction submissions and background checks instead of using legacy systems? 

I thought I heard Mr. DeVries say we’re pretty much done with the 

legacy systems. Have we fully migrated to the required XML system? 

Ms. MCGETTIGAN. I will have to defer that to Mr. DeVries. 

Mr. CONNOLLY. You don’t know the answer? 

Ms. MCGETTIGAN. I do not. 

Mr. CONNOLLY. Mr. DeVries. 

Mr. DEVRIES. No, sir, we have not. 

Mr. CONNOLLY. Why not? 

Mr. DEVRIES. So the whole legacy system is comprised of eight 

different systems which ask questions and interact and portray in 

conducting the investigation through them. A lot of the language 

on, especially I think it was a member here brought up the word 

PIPs, which is the main database system that maintains it there, 

that is on—written in language that is no longer supported. And 

I’m trying to move it out of there. 

It is not just merely a case of just taking something and putting 

it out to XML. We have employed XML in terms of the interface 

going into the customer. We have put that into all their front-facing applications there. And in that time, we’ve also put other protections in there, like masking of the Social Security number and 

other techniques. So yes, to the customer facing one, as we have 

on other OPM systems, we have put the XML piece into it. 

Mr. CONNOLLY. Ms. McGettigan, what is OPM and NBIB doing 

to ensure that if data is exfiltrated from the NBIB, NBIS systems, 

that the data will be protected and its location and attempted use 

not—will not only be prevented but visible to the NBIS for action? 

What are you doing to protect that in the exfiltration process? 

Ms. MCGETTIGAN. Again, sir, I’ll—— 

Mr. CONNOLLY. Can’t hear you. 

Ms. MCGETTIGAN. I apologize. Again, sir, I will have to defer to 

Mr. DeVries or Mr. Halvorsen. 

Mr. CONNOLLY. So again you can’t answer the question. 

Mr. DeVries. 

Ms. MCGETTIGAN. I cannot. 

Mr. CONNOLLY. Does the acting director of OPM get involved in 

these cyber issues at all? 

Ms. MCGETTIGAN. I do get involved somewhat, but not in the details. 


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Mr. CONNOLLY. Have you had any experience with the breach or 

responding to the breach in your period of time under Beth Cobert 

or Ms. Archuleta before that? 

Ms. MCGETTIGAN. I—when the breach occurred, I was in another 

area of the organization. I was in Human Resource Solutions. I was 

not the chief management officer at that time, so I was not intimately involved. I was involved from another area of the—I had no 

responsibility for that. 

Mr. CONNOLLY. Mr. DeVries, what are we doing about that 

exfiltration, protecting that data so it’s not breached? 

Mr. DEVRIES. Yes, sir. Sir, on a macro prospective, let’s start 

with the worthy employee or the individual who’s going to be investigated. He enters his records or his information into the e-QIP 

through the SF—Standard Form 86. That information is stored securely. It’s on an encrypted database. That is what gets queued up 

to go to the investigators once they are awarded that work, if you 

will, from the NBIB. With my coming on board in September, we 

changed that process. 

In the past, when the companies would get their task orders to 

do these investigations, and we just talked about the contract that 

was awarded out to the four new companies, two of those were existing ones and there are two new ones in there, the investigators 

no longer can download that information to their company information stores. It stays as part of the government, and we’ve incorporated a new security thing there where when they pull the 

records in, it is on a different encrypted system under their hard 

drive, and they authenticate themselves with a verification card 

that is issued by OPM and NBIB to them. 

Mr. CONNOLLY. I only have 30-something seconds, so let me ask 

another question. What are we doing to boost the capacity to decrease the enormous backlog on security background checks? Mr. 

Phalen. 

Mr. PHALEN. Yes, sir. We have done two things of large proportion. Number one, as was referenced earlier, we have started a new 

contract period and doubled the number of companies that are 

available to provide the contract investigations. And that, we believe, will have a significant impact on our ability to work off the 

backlog. At the same time, in fiscal 2016, we hired 400 new Federal investigators into the service. And we plan on, in 2017, adding 

another 200. And we are already seeing the fruits of that addition 

to work off the capacity. 

Mr. CONNOLLY. I think this is on top of many topics we’re talking 

about. This is really important. I get complaints all the time, especially from private sector companies with enormous numbers of 

jobs at the ready they cannot fill because of this backlog. And so 

the more we can do to streamline, expedite, while making sure it’s 

still accurate, I think is really critical moving forward. 

Thank you. 

Mr. PHALEN. Yes, sir. I agree. 

Mr. CONNOLLY. I yield back. 

Chairman CHAFFETZ. I thank the gentleman. 

We’ll now recognize the gentleman from Alabama, Mr. Palmer. 

Mr. PALMER. Thank you, Mr. Chairman. 


KING-6430 with DISTILLER
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I know you’re new on the job, Ms. McGettigan, and if there’s anyone on the panel who can answer this, I’d appreciate it. Does OPM 

allow employees to access personal email accounts, Facebook, do 

any other personal business using the Federal server? 

Ms. MCGETTIGAN. Employees are allowed to do limited access for 

personal and business. Access their bank accounts, what have you. 

So there’s limited access for personal business. Limited use. 

Mr. PALMER. Are you aware that it was reported that the Immigration and Customs Enforcement agency just a couple of years 

ago, I think it preceded maybe by a year or so the breach of the 

data systems at OPM, they had numerous cases where the 

breaches were coming—or the attacks were coming through the use 

of personal email utilizing the Federal server? Are you aware of 

that? 

Ms. MCGETTIGAN. No, sir, I was not. 

Mr. PALMER. Well, it’s an area that concerns me where—and employees, and not only employees, but high ranking officials, and I 

don’t know that you could answer this, if there are any OPM directors or other high-ranking officials using personal email accounts— 

or accessing personal accounts using the Federal server or using 

personal accounts to do business. We know that’s been a problem 

in other agencies, most notably the State Department. 

One of the things that concerns me is that it doesn’t appear to 

me that we’ve made the maximum effort to protect ourselves from 

cyber intrusion. And for the record, I’d like to point out that James 

Clapper made the point, the Director of National Intelligence, that 

it was the Chinese, not the Russians, that we believe hacked OPM. 

But I think this may have been asked earlier. 

OPM is still not fully compliant with the requirements for the 

use of personally identifiable verification cards, the PIV cards. 

Where are we on that? 

Mr. DEVRIES. Sir, I’ll take that. Sir, we are 100 percent compliant for the PIV cards for the users to access the network. 

Mr. PALMER. So is it a chip-based card? 

Mr. DEVRIES. Yes, sir, it is. 

Mr. PALMER. And multifactor verification? 

Mr. DEVRIES. Multifactor verification. 

Mr. PALMER. So we’ve got that across the board? 

Mr. DEVRIES. It needs the card and then you need the personal 

identification that you put your PIN in for. Correct, sir. 

Mr. PALMER. Let me ask you this: In regard to hiring people who 

handle your data systems, and particularly to protect against cyber 

attacks, how long does it take to process an applicant? For instance, I’ve got a—there’s a gentleman in—at the University of Alabama, Birmingham, one of the top people in the country on this, 

Gary Warner, and he’s turning out some of the best experts in 

cybersecurity. And the day they graduate—it’s almost the day they 

graduate, they can get a job with Visa, MasterCard. But it seems 

to take months to even get in the system for the Federal Government. Is that an issue at OPM? 

Ms. MCGETTIGAN. Well, yes, sir, it is an issue in terms of the 

background investigations. We are very much backlogged. We are 

committed to reducing that backlog. And we have—to that end, we 

have just—we have just awarded contracts to increase our capacity, 


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the field contracts to increase our capacity. And we are on a path 

to reduce that—to reduce that backlog. But it will take time, and 

employees of OPM or prospective employees of OPM are also waiting for background investigations. 

Mr. PALMER. Well, I know that—and I wasn’t here for the opening of this hearing—that there seems to be a tendency to try to 

make this—politicize this. And if that’s where some members want 

to go with it, that’s fine. But I think the seriousness of the breach 

at OPM requires that we do our jobs to make sure that our data 

systems are secure. 

And one of the things that I might suggest and encourage you 

to consider is doing the background checks on these top students 

while they’re still in school so that when they graduate, we’re not 

going to lose them to the private sector. I think that we put ourselves at great exposure by not having quicker access to the best 

people that are available to protect our data systems. 

Is that something that OPM might consider? Could we expedite 

the process? Because it’s unreasonable to think that someone could 

get a really good job somewhere else and then have to wait months 

to get an interview. 

Ms. MCGETTIGAN. Yes, sir. We do have some programs. We have 

a program, Presidential Management Fellow Program, where we 

have people apply—recent graduates apply. And they are vetted 

and then they become finalists. We do not do—to my knowledge, 

background investigations are always done at the—once the person 

receives a conditional offer of employment. So it’s the offer of employment that triggers the background investigation. 

Mr. PALMER. Well, I thank you for coming today. 

And I just want to make this last point, Mr. Chairman, that I 

think the point that needs to be made is that the purpose of this 

hearing is to make sure that our data systems are secure. And I 

think this committee will do whatever we need to do to make that 

possible. 

I yield back. 

Chairman CHAFFETZ. I thank the gentleman. 

We’ll now recognize the gentleman from Wisconsin, Mr. 

Grothman. 

Mr. GROTHMAN. Thank you. 

Mr. DeVries, we’ll ask you a question again. You know, the GAO 

recently found—— 

Chairman CHAFFETZ. Mr. Grothman, my apologies. My apologies. 

We need to go to the Democratic first. Mrs. Lawrence. I failed to 

recognize her. The gentlewoman is recognized for 5 minutes. 

Mrs. LAWRENCE. I know you would never purposely not recognize 

me, Mr. Chairman. 

Yesterday, Ranking Member Cummings sent a letter to the Defense Secretary about potentially serious violation of the Constitution by Lieutenant Governor Michael Flynn, the President’s national security adviser. General Flynn had admitted that he was 

paid to attend an event sponsored by the Russian-backed television 

network known as RT. And he dined with the Russian President 

Putin. RT has been described by the NSA, CIA, and FBI, and I 

quote: ‘‘The Kremlin’s principal international propaganda outlet. It 


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receives funding, staffing, and direction from the Russian Government.’’ 

Director Phalen, your staff provided the Standard Form 86 for 

security clearance holders. One question on the form, and I quote: 

‘‘Have you or any member of your immediate family in the past 7 

years had any contact with a foreign government, its establishment, or its representatives, whether inside or outside of the U.S.?’’ 

My question to you, why are these individuals asked this question? 

Mr. PHALEN. Thank you, Representative, for that question. The 

reason these questions are asked is to ensure that the individual 

who is making an adjudicative decision understands what relationships an individual may have with a foreign government or foreign 

representative. And the nature of that question is to get to the 

heart of what that relationship may be. It could be benign, it could 

be not benign. But this would be the judgment of the adjudication 

organization. Our goal would be, based on the response to that 

question, to gather as much information as we can get to—— 

Mrs. LAWRENCE. The form also asks the question, and I quote: 

‘‘Have you in the past 7 years provided advice or support to any 

individual associated with a foreign business or foreign organization?’’ 

So my question to you is, do you know if General Flynn has a 

clearance? 

Mr. PHALEN. I have not checked the record. I believe he does 

have a clearance, but I don’t know that authoritatively. And if I 

could add, that the investigation of General Flynn, given his role 

in the White House, would generally be conducted by the FBI and 

not by NBIB. 

Mrs. LAWRENCE. So you don’t know if he has a clearance, correct? 

Mr. PHALEN. I don’t know authoritatively, but I believe he does. 

Mrs. LAWRENCE. Do you know if he ever reported to the appropriate authorities? 

Mr. PHALEN. I do not know that. 

Mrs. LAWRENCE. Do you know if General Flynn ever reported 

how much he paid—how much he was paid for his trip? 

Mr. PHALEN. I do not know that. 

Mrs. LAWRENCE. So you’re stating within the government that 

would be the FBI that would answer that question? 

Mr. PHALEN. The—his reporting chain, if his clearance was still 

through the Department of Defense, would have been back through 

a Department of Defense security office, and they would be the organization that would have that on the record. It would be up to 

the FBI, if they were doing the investigation, to go back and reach 

out to the Department of Defense and ask if that had been reported. 

Mrs. LAWRENCE. Do you know if that reach-out has happened? 

Mr. PHALEN. I do not know. 

Mrs. LAWRENCE. Mr. Chairman, we need to get answers to these 

basic questions. And I am requesting that the committee send a 

letter requesting a copy of General Flynn’s security clearance application, as well as any and all updates he may have submitted. 

Will the chair agree to that? 

Chairman CHAFFETZ. Send me the request. 


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Mrs. LAWRENCE. I appreciate it. 

Mrs. LAWRENCE. We have a responsibility, and we have been 

talking about this. And, Mr. Chairman, you have been a staunch 

leader in this, and this is an area I feel that we need questions answered. Thank you so much. 

Chairman CHAFFETZ. I now recognize the gentleman from Wisconsin, Mr. Grothman. 

Mr. GROTHMAN. Okay, Mr. DeVries. GAO found that personnel 

management had not yet completed and submitted a data center 

optimization plan. And, originally, that was supposed to be done in 

September of last year. Do you know when that plan will be completed, or has it been completed? 

Mr. DEVRIES. Thank you, sir. I appreciate that question because 

that’s one that’s near and dear to my heart. 

I came onboard as the CIO in September. We did not publish 

that one, because it was not complete. I completed the assessment 

on it, and we’re finalizing that. And that should be done back up 

to OMB by the end of this quarter here. 

Mr. GROTHMAN. By the end of? 

Mr. DEVRIES. This quarter. 

Mr. GROTHMAN. Okay. So the next couple months. Okay. Do you 

know what the savings goal you have for a plan like that is? 

Mr. DEVRIES. Sir, I do not have the savings goal in terms of the 

final numbers yet. That’s part of the assessment that’s still ongoing 

right now. 

Mr. GROTHMAN. Okay. How many data centers do you own now? 

Mr. DEVRIES. Today, sir, I own seven. We closed down two, and 

we’re about ready to move out of our third one here in the next 2 

months. 

Mr. GROTHMAN. Oh, that’s good. What do we have left? What are 

the ones that are left? 

Mr. DEVRIES. And then I have five left. And I’m going down to 

two. 

Mr. GROTHMAN. Okay. Good. 

Let me give you another question. During the data discovery 

breach and mitigation process, your relationship with the inspector 

general was strained. There was a lack of communication, time— 

there wasn’t timely reporting, I think the IG wasn’t informed really 

what you would consider on a timely basis. I understand things 

have improved since that time. How would you characterize your 

relationship with the inspector general today? 

Mr. DEVRIES. On behalf of the CIO office, I’ll say it’s very good. 

I say that because we meet monthly with his staff and my staff to 

go through what their concerns are, what their findings are, what 

our status is of reporting back to those findings. It’s a very good 

relationship. They hold nothing back. 

And I’d like to defer now the final question to my chief information security officer, because he deals with them much more frequently. 

Mr. GROTHMAN. Okay. 

Mr. CHASE. Is that okay, Representative? 

Mr. GROTHMAN. Sure. Yeah. 

Mr. CHASE. So one of the things when I came onboard was to establish a good relationship with the inspector general. We meet on 


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a weekly basis to talk about all the progress. And so—and I know 

I mentioned it earlier, but I’ll say it again, is everything from the 

compliance efforts that we did to the engineering rollouts, so 

there’s a lot of things going on that I wanted to make sure that 

the inspector general is abreast of. And so with that, they’ve given 

us guidance on what’s appropriate to align to their FISMA report 

metrics and reporting. And it’s been helpful not only for me but my 

staff behind me to see why that relationship is one that pays dividends in the long run. 

Mr. GROTHMAN. Good. And if there was a breach today, how 

quickly would the inspector general know? 

Mr. CHASE. As quickly as everybody else. 

Mr. GROTHMAN. Okay. 

Mr. DEVRIES. Sir, I make that first phone call to the director, the 

second one is to the OIG, so it’s realtime—— 

Mr. GROTHMAN. Okay. Thank you. 

I yield the remainder of my time. 

Chairman CHAFFETZ. The gentleman yields back. 

I now recognize the ranking member, Mr. Cummings. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. 

Director Phalen, according to the website, the National Background Investigations Bureau, NBIB, is now responsible for conducting, and I quote: ‘‘Approximately 95 percent of the total background investigations governmentwide.’’ 

Is that right? 

Mr. PHALEN. Yes, sir, that is. 

Mr. CUMMINGS. Out of the total number of background investigations that NBIB is responsible for conducting, does that include political appointees in the Trump administration? 

Mr. PHALEN. Generally not. 

Mr. CUMMINGS. Not? 

Mr. PHALEN. Generally not. 

Mr. CUMMINGS. Okay. 

Mr. PHALEN. Yes. 

Mr. CUMMINGS. And why not? 

Mr. PHALEN. By tradition, that work has been given to the FBI 

to conduct those investigations by the White House. 

Mr. CUMMINGS. And so a—now, guideline A of the adjudicative 

guideline states that individuals seeking a security clearance must 

have unquestioned allegiance to the United States, and lays out a 

series of examples of disqualifying factors that investigators and 

adjudicators will use to determine eligibility. 

Based on some of the questions on that SF86, I think many people often think of association with groups seeking to overthrow the 

U.S. Government by violent means, like violent anarchists or terrorist groups. When we think of this guideline, is that fair? 

Mr. PHALEN. Yes, that would be a major piece of that category. 

Yes, sir. 

Mr. CUMMINGS. But the disqualifying factors in the guideline 

may include much more than that. Do they not? They include 

whether a person associates with or shares the viewpoint of those 

who advocate using illegal or unconstitutional means to prevent 

government personnel from performing their official duties or others from exercising their constitutional rights. Is that correct? 


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Mr. PHALEN. Those are—those are questions to be considered in 

an adjudication, yes, sir. 

Mr. CUMMINGS. And it could—and it could conclude—include persons who associate or share the viewpoint of those who use illegal 

or unconstitutional means to, quote, ‘‘gain attribution for perceived 

wrongs caused by Federal, State, or local government,’’ end of 

quote. Is that correct? 

Mr. PHALEN. Those would be adjudicative questions, yes, sir. 

Mr. CUMMINGS. If your investigations uncovered negative or derogatory information in any of those areas, I imagine that you 

could raise concern with regard to them. Is that correct? 

Mr. PHALEN. They would be noted in the investigation, and they 

would be forwarded to an adjudicative—adjudication authority to 

make a determination as to whether that individual should be 

cleared. 

Mr. CUMMINGS. So I want to walk you through a few short examples. If someone said that they were a Boy Scout or Girl Scout, 

would that raise a concern under guideline A? Of course not. Is 

that right? 

Mr. PHALEN. No, sir. 

Mr. CUMMINGS. What if someone described themselves as a Leninist, which refers to the Russian revolutionary who was not a fan 

of our democratic government, should that raise concerns for your 

investigators? 

Mr. PHALEN. It would, and the investigator should pursue that 

avenue of discussion with the subject as to what that means. 

Mr. CUMMINGS. What if someone said that his goal was to, quote, 

‘‘destroy the State,’’ unquote, what response would that elicit? 

Mr. PHALEN. That would elicit a very strong line of questioning 

with that individual and with others to determine what he means 

by that, so that we can give a full picture to the adjudicator. 

Mr. CUMMINGS. What if somebody said, quote, ‘‘I want to bring 

everything crashing down and destroy all of today’s establishment,’’ 

end of quote, should that raise a concern? 

Mr. PHALEN. That would be noteworthy in an adjudication, yes, 

sir. 

Mr. CUMMINGS. Chairman, each of these phrases were reportedly 

used by Steve Bannon to describe his views and his goals, according to Ronald Radosh of The Daily Beast. Mr. Bannon has since reportedly denied saying those things, but I imagine an investigator 

would still have concerns about them. I imagine that they would 

also want to see numerous reports about racism rampant on the 

news website Mr. Bannon used to run. 

Mr. Chairman, this is—this is a very serious problem. The President has picked Mr. Bannon to be his chief strategist and senior 

counselor. Not only that, the President just reorganized the National Security Council and gave Mr. Bannon a permanent seat at 

the table, while removing the chairman of the Joint Chiefs of Staff 

and director of National Intelligence. This is at least—I mean, it 

causes us to—we should wonder about this and question it. 

Do you—if—you may have answered this earlier. If somebody is 

under criminal investigation—and I know that we now have a liaison. Tell me how that works, a criminal liaison to try to work 


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with—what happens when you find out somebody is under criminal 

investigation? 

Mr. PHALEN. Depending what the criminal—criminal investigation is and the immediate seriousness of the nature, we may immediately contact the requesting agency that is asking for the clearance to give them sort of a heads-up that this is out there. And 

they may or may not determine at that point they want to terminate the request for a clearance. Otherwise, we’ll continue the investigation. 

The fact that—going further down the road, an adjudicator would 

be faced with this question, this is an individual under criminal investigation, it would be up to them to understand what that investigation is about and to make a judgment whether or not that investigation or what is surrounding it would be disqualifying for access to classified information, whether—essentially, whether it 

shows an inability to be trusted to hold onto classified information. 

Mr. CUMMINGS. So, in other words, the person could still get a— 

get a clearance? 

Mr. PHALEN. Yes. 

Mr. CUMMINGS. And I would assume that if that person were 

then later on convicted of an offense, then that probably his clearance would be withdrawn. Is that right? 

Mr. PHALEN. If—— 

Mr. CUMMINGS. And who would do that? 

Mr. PHALEN. The organization that issued the clearance would be 

the organization to rescind the clearance. And—based on what they 

see. And they would make—and if it had already been issued, an 

individual is convicted, it would be up to that organization to determine whether or not that conviction has any impact on their ability 

to be trusted. 

Mr. CUMMINGS. My last question. The—I just gave some quotes 

that are attributed to Mr. Bannon. Would—I mean, if they—if you 

were to raise—if those questions were raised, would anyone go and 

then—and then the—say, Mr. Bannon, or whoever may have said 

those kind of things, denied them, would, then, you—would—would 

somebody go back to look to see if those statements were made in 

other—in the periodicals, whatever? And how might that affect the 

security clearance of that person? Do you understand my question? 

Mr. PHALEN. I believe I do. We—if—if we—first, if we were faced 

with an individual who had made statements that appeared to be 

counter to the United States, that would be an issue we would pursue with the subject themselves, to start with. And to use your example, if that individual said, no, I never really said that, I don’t 

really feel that way, we would use, to the best of our ability, whatever sources we can find to get to—to do issues resolution, to determine whether—what the truth is, to the extent that we can, so that 

we can give as full a picture as we can to the official that has to 

make that ultimate decision. 

Mr. CUMMINGS. And if you discovered that, unequivocally, that 

the person had not been honest with you, what might—effect that 

have? 

Mr. PHALEN. That would, again, be passed on to the adjudication 

authority, and they would have to determine whether that makes 

a difference or not. 


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Mr. CUMMINGS. Mr. Chairman, thank you for your indulgence. 

Chairman CHAFFETZ. Thank you. 

I’ll now recognize the gentlewoman from New York, Mrs. 

Maloney. 

Mrs. MALONEY. Thank you, very much. 

Chairman CHAFFETZ. Your microphone. Microphone. 

Mrs. MALONEY. You know, I’m really concerned about 

cybersecurity. And if Congress is serious about helping agencies 

improve their cybersecurity, it must call on the President to rescind, in my opinion, his across-the-board hiring freeze. How in the 

world can you move forward if you can’t even hire the people that 

can do the job? Such—this freeze that he’s put in place, in my opinion, undermines the Federal Government’s ability to recruit, develop, and maintain a pipeline of cybersecurity talent that’s needed 

to strengthen Federal cybersecurity. And if there was a field that 

didn’t change every 24 hours, it’s cybersecurity. You have to get the 

youngest, brightest, latest people that are involved in it. 

So I am concerned about this freeze that he put in place, I think 

it was roughly 2 weeks ago. And he’s taken other steps that will 

make it more difficult for Federal agencies to improve the area of 

cybersecurity. So I—and then he issued this memoranda ordering 

across-the-board hiring freeze in the Federal Government. And I 

want to quote from it. And I quote: ‘‘As part of this freeze, no vacant positions existing at noon on January 22, 2017, may be filled, 

and no new positions may be created.’’ 

So it seems to me that when it comes to improving cybersecurity, 

a hiring freeze is one of the most counterproductive policies that 

you could ever put in place. 

And after the 2015 cybersecurity at OPM, Federal CIO Tony 

Scott and then OMB Director Shaun Donovan put in place a 

cybersecurity strategy and implementation plan for the entire government. And I quote: ‘‘The vast majority of Federal agencies site 

a lack of cyber and IT talent as a major resource constraint that 

impacts their ability to protect information and assets.’’ 

And so I’d just like to ask Mr. DeVries, as the CI—CIO of OPM, 

can you highlight some of the challenges that OPM has faced when 

it comes to recruiting and hiring cybersecurity specialists? And, obviously, you can’t do anything if you can’t hire anybody. So could 

you give us some insights there? 

Mr. DEVRIES. Thank you very much for that question. That is 

a—that is pertained to OPM. It’s pertained to the Federal workspace and the Federal cybersecurity and IT professionals. That is 

a concern to all of us of how do I keep the pipeline coming in there. 

I will tell you, from my experience just coming onboard in OPM 

in September, we have, for example, five hiring actions out there, 

and we had about a 60 percent—we did not get to them fast 

enough before they went someplace else. We have completed that. 

We have filled those things. But, again, that’s our challenge across 

the Federal spaces, how do I recruit and retain these folks. 

I will tell you, it comes from the passion of the heart. They come 

onboard. If I give them meaningful experiences, training they will 

stay. I think we’re also working across the Federal space of how 

do I help improve the rotation, if you will, from Federal service 

back to industry and then back in again. We need to make—we 


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have made strides on it. We need to continue to work on that together. 

Mrs. MALONEY. Well, I—I’ve got to say that cybersecurity is really tied to the security of the Nation. And I think—I don’t see how 

you can do your job if you can’t hire people. 

So I would respectfully like to request that the chairman think 

about maybe asking for a waiver for the cybersecurity area in hiring. Number one, as Mr. DeVries pointed out, it’s hard to hire 

them, because they’re in great demand all over the country right 

now, that is a prime focus of the country. And so we need to work 

in this for the good of the country. 

And I—we’re all individuals. I’m going to write the President my 

own letter and request that he waive it for the area of 

cybersecurity. 

But can you just go over some of the agencies, how does this 

hinder your ability and capability to improve when it comes to securing IT systems when you’re not able to hire people? How does 

this affect you? 

Ms. MCGETTIGAN. Congresswoman, it terms of the hiring freeze, 

this is a 90-day freeze, and there are many exemptions to that 

freeze, primarily in terms of national security, public health, and 

public safety. 

Mrs. MALONEY. But isn’t this national security, cybersecurity? 

Ms. MCGETTIGAN. Well, agency heads are able to make that determination and to exempt those positions that are deemed to be 

national security. 

Mrs. MALONEY. So that’s taken care of? 

Ms. MCGETTIGAN. If they are not—if they have a position, a 

cybersecurity position, that they would not feel was national security, they can come to OPM and we will review their request for 

an exemption from that. 

Mrs. MALONEY. Have any people asked for exemptions? 

Ms. MCGETTIGAN. At this point, no. I’m not aware specifically 

that anyone has come into OPM. I haven’t seen any requests. 

Mrs. MALONEY. Okay. My time has expired. Thank you. 

Chairman CHAFFETZ. Thank you. 

Just a few wrap-up questions. 

Mr. DeVries, could you please provide the committee all the 

NCAPs or other pen test reports conducted in the last year? Is that 

something you can provide the committee? 

Mr. DEVRIES. Yes, sir, we can. 

Chairman CHAFFETZ. Okay. Thank you. We appreciate it if you’d 

do that. 

And then, Mr. Phalen, one of the—one of the sad realities of 

what happened when Director Archuleta was in place is this hack 

had legacy systems online that dated back to 1985. And my understanding is, even if you applied for a job and didn’t get a job with 

the Federal Government, and you did it after 1985, you might have 

been in that system. 

What are you doing to take sort of the nonactive records so 

they’re not online and, thus, accessible to some hacking? Have you 

made any adjustments there? 

Mr. PHALEN. To be honest, sir, I don’t know. I know we have 

done a tremendous amount, you’ve heard it earlier today, in securVerDate Nov 24 2008 11:34 Aug 25, 2017 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6633 H:\26358.TXT APRIL

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ing the systems. And I’m very comfortable that we have both the 

barriers on the front end and the ability to, my words, fight sort 

of an active shooter online on the network, should it appear. I don’t 

believe we’ve taken a tremendous amount of this and put it offline, 

because it is—it needs to be accessible for any future work that we 

do. 

Chairman CHAFFETZ. To a degree. I mean, you know, if somebody 

retired in 1991 and then all of a sudden we have a hack in 2014, 

it does kind of beg the question why is that system—Mr. Halvorsen 

looks like he has something. 

Mr. HALVORSEN. Yes. The new system will have tiered storage on 

it both in terms of what’s live, what goes back, and it will take into 

consideration some of the things you said. If you are offline for a 

while, that will go into a different storage system, and it will be 

much harder to access. 

Chairman CHAFFETZ. It just—it seems like one of the lessons we 

should have learned for the nonactive employees—again, there may 

be a period of time. You all are more experts on it than we are, 

but after a certain amount of time, maybe it should be, you know, 

more sitting in some mountain somewhere as opposed to online. 

Two last questions. Who’s in charge? When there’s conflict, disagreement, when there is an attack, who ultimately is in charge? 

Mr. CHASE. So through my program, we actually have a process 

that we implemented based on the lessons learned from the 2015 

breach, and there is a communication path that routes up into the 

director’s office through the CIO with the severity and any data or 

details related to that incident. 

Chairman CHAFFETZ. So who—who is in charge? 

Mr. CHASE. So—— 

Chairman CHAFFETZ. Who ultimately makes the hard decision if 

there’s a disagreement, a question? You’ve got the DOD. You’ve got 

OPM. Something’s not—who is the ultimate decisionmaker? 

Mr. DEVRIES. So I’d like to take that on. If it’s on the current 

system that OPM and I, as the CIO, am responsible for, I do that. 

Chairman CHAFFETZ. Okay. 

Mr. DEVRIES. On the new system, within the NBIS, as we transition to it, DOD will. 

Chairman CHAFFETZ. Okay. So that would be Mr. Halvorsen or 

whoever his replacement is? 

Mr. DEVRIES. Correct. 

Mr. HALVORSEN. That is correct. 

Chairman CHAFFETZ. Okay. Last question. Mr. Halvorsen, you 

have the freedom of retirement there running around the corner 

here. So given that, your years of service, your perspective, your expertise, summarize for us, what should the Congress understand? 

What are your greatest frustrations and concerns and your best 

suggestions that you can offer us? 

Mr. HALVORSEN. Well, first, I’ll thank Congress. As you know, 

working through many of the members here, we did get the cyber 

accepted service law, which I do think was the first thing that we 

needed to get done to recruit and move past some of the things that 

were blocking our ability. 

I do think we are going to have to reevaluate the pay scale for 

cybersecurity personnel and some other key positions. We do rely 


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on patriotism. We can recruit people a lot for that, but the pay disparities are getting out of hand. I mean, I will tell you, I have lost 

six or seven people this year, very good, basically, because they 

could not anymore turn down the offers. And I can’t counsel them 

against that after a certain point. 

Chairman CHAFFETZ. I’m totally convinced that you’re right. And 

I hope that this Congress—I plan on helping to champion some legislation to give more realistic assessment to provide that flexibility, 

because I do think you’re right. 

Mr. HALVORSEN. And I think the other more most important 

thing that we do, and I have said this before, I will keep saying 

it, I do think the secret weapon of our country is, to keep our security, keep our edge in warfighting is better use of our industry and 

commercial mobility and agility. 

You have seen—we talk about this in DOD. We are embarking 

to bring as much commercial into these activities. We are doing it 

with this system as the build of the new. We need to continue that, 

and we need to continue that against—across the foreign government—I mean, across the Federal Government space. That also 

means we will have to work and raise the bar for industry on security. 

While I’ll be the first to say that DOD included, we have to get 

better in our security practices. And I am heartened by what I see 

in my discussions with the commercial community. They are starting to take that to heed, and we are seeing a rise in their ability 

to protect data. We need to encourage that and open up our dialogue with the commercial sector on how best to do that and share 

more information. 

Chairman CHAFFETZ. Thank you, again, Mr. Halvorsen. We 

thank you for your service, and we wish you nothing but the best 

of luck in whatever your future endeavors take you. And thank you 

again for your service. 

Let me recognize Mr. Cummings, and we’ll close the meeting. 

Mr. CUMMINGS. Thank you. Thank you. I want to thank all of our 

witnesses for being here today. You certainly have been extremely 

helpful. And I want to—you know, I just hope that the—I want to 

express my appreciation to all the people that work with you, because I know that you all have teams of people who give their 

blood, their sweat, their tears, because they want America to remain the greatest country in the world. 

Mr. Halvorsen, again, I want to join in with the chairman and 

thank you for your service. 

I have a brother who is a former Air Force officer, who is not a 

cyber expert, so he talks to me all the time about the demand for 

these folks who are good. I also have sat on the Naval Academy 

Board of Visitors for the last 12 years. And one thing that we’ve 

done in the Naval Academy it’s now mandatory that every student 

have—I know you probably already know this—have extensive 

cyber lessons as part of our curriculum, and so we see the significance of it. 

I want to ask you this: One of the things that we wrestle with 

is Federal employees feel that they are under attack constantly. 

We’ve seen recently where all kinds of measures have been put 

forth that really make them feel pretty insecure. And I’m just wonVerDate Nov 24 2008 11:34 Aug 25, 2017 Jkt 000000 PO 00000 Frm 00059 Fmt 6633 Sfmt 6633 H:\26358.TXT APRIL

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dering, how do you—I mean, first of all, talk about, briefly, the people that you’ve worked with and what they bring to the table. Because a lot of people, I think, get the impression sometimes that 

the people who work for the Federal Government are not giving a 

lot and not giving their best and not feeding their souls, as I often 

say. 

I just want—you know, you’re on your way out. You’ve had an 

opportunity to work with a lot of people. And I’m sure one of the 

saddest parts is probably a bittersweet thing, you created a family. 

I always tell my children that whenever you get a job, you also create a family of people who are looking out for you and who care 

about you and who you—sometimes you’re with more than you’re 

with your own family. 

So could you just talk about some of the, just generally, the people that you’ve worked with, sir? Because I know that you could 

not have done what you’ve been able to accomplish without a support system. If you might, just very briefly. 

Mr. HALVORSEN. Well, you know, I will tell you, having both been 

in the military and in Federal service, highest respect for the Federal workforce. They do exceptional work. They put in a lot of 

hours. They do their best on everything they can do. But I’m also 

going to comment, I see that also in the commercial workspace 

when I bring the people in. I do think this is a leadership issue. 

And if you make your—any of your employees, whether they’re 

Federal, military, or commercial, feel a part of the team and you 

listen to that team, they will give you everything they’ve got to 

get—to get the work done. And that—I have 37 years, that’s what 

I have seen in the Federal Government and in that workspace. 

Mr. CUMMINGS. And I think when you show people that you truly 

care about them—not just about them, but their families and their 

welfare—I tell the people that come to work with us on the OGR, 

if they are not better when they leave me, then I’ve failed. In other 

words, if they are—their skill level is not higher, if they’re not 

more proficient, if they’re not more effective and efficient, then I’ve 

done something wrong. Because I want to invest in them. Because 

I want to be a part of their destiny. I want to touch their futures. 

Even when I’m dancing with the angels, I want to know that 

they’ve gone on to do great things, because our Nation really needs 

the very, very best. 

And so I can tell you that working with the chairman, we saw 

that. We—in working with the—then I’ll be finished. I give the 

chairman a lot of credit, because when we looked at the Secret 

Service, he and I made a concerted effort to say to the Secret Service we wanted the elite of the elite. We wanted the very, very best, 

and we wanted to create that culture. 

And I think we’re moving toward this, Mr. Chairman. I don’t 

know that we’ve gotten there yet, but we’re trying to get there. 

But—and we’ve done that in a number of agencies in a bipartisan 

way. 

And, again, I just—you know, the only reason I raise the question, Mr. Halvorsen, is because I just want the public to be reminded that, you know, there’s a vast array of Federal employees 

that keep our country the great country that it is. 


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And, again, I want to thank all of you and everybody who back 

you all up for doing what you do. And, now, we still have a lot of 

work to do, as you’ve all made very, very clear, but I believe that, 

you know, we can—we can get it done. 

And thank you, Mr. Chairman. 

Chairman CHAFFETZ. Thank you. And thank you all. And please 

let them know, the men and women who work within your departments and groups, how much we do appreciate it. It’s a tough job, 

but it’s a very important job, and we do appreciate it. 

Thank you. The committee stands adjourned. 

[Whereupon, at 11:28 a.m., the committee was adjourned.] 


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APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD


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Statement for the Record 

Worldwide Threat Assessment 

of the 

US Intelligence Community 

Senate Armed Services Committee 

James R. Clapper 

Director of National Intelligence 

February 9, 2016 
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STATEMENT FOR THE RECORD 

WORLDWIDE THREAT ASSESSMENT 

of the 

US INTELLIGENCE COMMUNITY 

February 9, 2016 

INTRODUCTION 

Chairman McCain, Vice Chairman Reed, Members of the Committee, thank you for the invitation to offer 

the United States Intelligence Community's 2016 assessment of threats to US national security. My 

statement reflects the collective insights of the Intelligence Community's extraordinary men and women, 

whom I am privileged and honored to lead. We in the Intelligence Community are committed every day to 

provide the nuanced, muHidisciplinary intelligence that policymakers. warfighters. and domestic law 

enforcement personnel need to protect American lives and America's interests anywhere in the world. 

The order of the topics presented in this statement does not necessarily indicate the relative importance 

or magnitude of the threat in the view of the Intelligence Community. 

Information available as of February 3, 2016 was used in the preparation of this assessment 
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TABLE OF CONTENTS 

GLOBAL THREATS 

Cyber and Technology 

Terrorism 

Weapons of Mass Destruction and Proliferation 

Space and Counterspace 

Counterintelligence 

Transnational Organized Crime 

Economics and Natural Resources 

Human Security 

REGIONAL THREATS 

East Asia 

China 

Southeast Asia 

North Korea 

Russia and Eurasia 

Russia 

Ukraine, Belarus, and Moldova 

The Caucasus and Central Asia 

Europe 

Key Partners 

The Balkans 

Turkey 

Middle East and North Africa 

Iraq 

Syria 

Libya 

Yemen 

Iran 

ii 

Pa e 

4 

6 

9 

10 

11 

12 

13 

16 

16 

17 

17 

17 

17 

19 

19 

20 

20 

20 

21 

21 

21 

22 

23 

23 

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Lebanon 25 

Egypt 25 

Tunisia 25 

South Asia 26 

Afghanistan 26 

Bangladesh 27 

Pakistan and India 27 

Sub-Saharan Africa 27 

Central Africa 27 

Somalia 28 

South Sudan 28 

Sudan 28 

Nigeria 28 

latin America and Caribbean 28 

Central America 28 

Cuba 29 

Venezuela 29 

Brazil 29 

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GLOBAL THREATS 

CYBER AND TECHNOLOGY 

Strategic Outlook 

The consequences of innovation and increased reliance on information technology in the next few years 

on both our society's way of life in general and how we in the Intelligence Community specifically perform 

our mission will probably be far greater in scope and impact than ever. Devices, designed and fielded 

with minimal security requirements and testing, and an ever-increasing complexity of networks could lead 

to widespread vulnerabilities in civilian infrastructures and US Government systems. These 

developments will pose challenges to our cyber defenses and operational tradecraft but also create new 

opportunities for our own intelligence collectors. 

Internet of Things (loT). "Smart" devices incorporated into the electric grid, vehicles-including 

autonomous vehicles-and household appliances are improving efficiency, energy conservation, and 

convenience. However, security industry analysts have demonstrated that many of these new systems 

can threaten data privacy, data integrity, or continuity of services. In the future, intelligence services 

might use the loT for identification, surveillance, monitoring, location tracking, and targeting for 

recruitment, or to gain access to networks or user credentials. 

Artificial Intelligence (AI). AI ranges from "Narrow AI" systems, which seek to execute specialized 

tasks, such as speech recognition, to "General AI" systems-perhaps still decades away-which aim to 

replicate many aspects of human cognition. Implications of broader AI deployment include increased 

vulnerability to cyberattack, difficulty in ascertaining attribution, facilitation of advances in foreign weapon 

and intelligence systems, the risk of accidents and related liability issues, and unemployment. Although 

the United States leads AI research globally, foreign state research in AI is growing. 

The increased reliance on AI for autonomous decisionmaking is creating new vulnerabilities to 

cyberattacks and influence operations. As we have already seen, false data and unanticipated algoritihm 

behaviors have caused significant fluctuations in the stock market because of the reliance on automated 

trading of financial instruments. Efficiency and performance benefits can be derived from increased 

reliance on AI systems in both civilian industries and national security, as well as potential gains to 

cybersecurity from automated computer network defense. However, AI systems are susceptible to a 

range of disruptive and deceptive tactics that might be difficult to anticipate or quickly understand. Efforts 

to mislead or compromise automated systems might create or enable further opportunities to disrupt or 

damage critical infrastructure or national security networks. 

Foreign Data Science. This field is becoming increasingly mature. Foreign countries are openly 

purchasing access to published US research through aggregated publication indices, and they are 

collecting social media and patent data to develop their own indices. 
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Augmented Reality (AR) and Virtual Reality (VR). AR and VR systems with three-dimensional imagery 

and audio, user-friendly software. and low price points are already on the market; their adoption will 

probably accelerate in 2016. AR provides users with additional communications scenarios (e.g. by using 

virtual avatars) as well as acquisition of new data (e.g. from facial recognition) overlaid onto reality. VR 

gives users experiences in man-made environments wholly separate from reality. 

Protecting Information Resources 

Integrity. Future cyber operations will almost certainly include an increased emphasis on changing or 

manipulating data to compromise its integrity (i.e., accuracy and reliability) to affect decisionmaking, 

reduce trust in systems. or cause adverse physical effects. Broader adoption of loT devices and Al-in 

settings such as public utilities and health care-will only exacerbate these potential effects. Russian 

cyber actors. who post disinformation on commercial websites, might seek to alter online media as a 

means to influence public discourse and create confusion. Chinese military doctrine outlines the use of 

cyber deception operations to conceal intentions. modify stored data. transmit false data, manipulate the 

flow of information. or influence public sentiments-all to induce errors and miscalculation in 

decisionmaking. 

Infrastructure. Countries are becoming increasingly aware of both their own weaknesses and the 

asymmetric offensive opportunities presented by systemic and persistent vulnerabilities in key 

infrastructure sectors including health care, energy. finance, telecommunications, transportation. and 

water. For example. the US health care sector is rapidly evolving in ways never before imagined, and the 

cross-networking of personal data devices, electronic health records, medical devices, and hospital 

networks might play unanticipated roles in patient outcomes. Such risks are only heightened by largescale theft of health care data and the internationalization of critical US supply chains and service 

infrastructure. 

A major US network equipment manufacturer acknowledged last December that someone repeatedly 

gained access to its network to change source code in order to make its products' default encryption 

breakable. The intruders also introduced a default password to enable undetected access to some target 

networks worldwide. 

lnteroperabllity. Most governments are exploring ways to exert sovereign control over information 

accessible to and used by their citizens and are placing additional legal requirements on companies as 

they seek to balance security, privacy. and economic concerns. We assess that many countries will 

implement new laws and technologies to censor information. decrease online anonymity, and localize 

data within their national borders. Although these regulations will restrict freedoms online and increase 

the operating costs for US companies abroad, they will probably not introduce obstacles that threaten the 

functionality of the Internet. 

Identity. Advances in the capabilities of many countries to exploit large data sets almost certainly 

increase the intelligence value of collecting bulk data and have probably contributed to increased 

targeting of personally identifiable information. Commercial vendors, who aggregate the bulk of digitized 

information about persons. will increasingly collect, analyze, and sell it to both foreign and domestic 

customers. We assess that countries are exploiting personal data to inform a variety of 

counterintelligence operations. 

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Accountability. Information security professionals will continue to make progress in attributing cyber 

operations and tying events to previously identified infrastructure or tools that might enable rapid 

attribution in some cases. However, improving offensive tradecraft, the use of proxies, and the creation 

of cover organizations will hinder timely, high-confidence attribution of responsibility for state-sponsored 

cyber operations. 

Restraint. Many actors remain undeterred from conducting reconnaissance, espionage, and even 

attacks in cyberspace because of the relatively low costs of entry, the perceived payoff, and the lack of 

significant consequences. Moscow and Beijing, among others, view offensive cyber capabilities as an 

important geostrategic tool and will almost certainly continue developing them while simultaneously 

discussing normative frameworks to restrict such use. Diplomatic efforts in the past three years have 

created the foundation for establishing limits on cyber operations, and the norms articulated in a 2015 

report of the UN Group of Governmental Experts suggest that countries are more likely to commit to 

limitations on what cyber operations can target than to support bans on the development of offensive 

capabilities or on specific means of cyber intervention. For example, in 2015, following a US-Chinese 

bilateral agreement, G-20 leaders agreed that that no country should conduct or sponsor cyber 

espionage for the purpose of commercial gain. 

Leading Threat Actors 

Russia. Russia is assuming a more assertive cyber posture based on its willingness to target critical 

infrastructure systems and conduct espionage operations even when detected and under increased 

public scrutiny. Russian cyber operations are likely to target US interests to support several strategic 

objectives: intelligence gathering to support Russian decisionmaking in the Ukraine and Syrian crises, 

influence operations to support military and political objectives, and continuing preparation of the cyber 

environment for future contingencies. 

China. China continues to have success in cyber espionage against the US Government, our allies, and 

US companies. Beijing also selectively uses cyberattacks against targets it believes threaten Chinese 

domestic stability or regime legitimacy. We will monitor compliance with China's September 2015 

commitment to refrain from conducting or knowingly supporting cyber-enabled theft of intellectual property 

with the intent of providing competitive advantage to companies or commercial sectors. Private-sector 

security experts have identified limited ongoing cyber activity from China but have not verified state 

sponsorship or the use of exfiltrated data for commercial gain. 

Iran. Iran used cyber espionage, propaganda, and attacks in 2015 to support its security priorities, 

influence events, and counter threats-including against US allies in the region. 

North Korea. North Korea probably remains capable and willing to launch disruptive or destructive 

cyberattacks to support its political objectives. South Korean officials have concluded that North Korea 

was probably responsible for the compromise and disclosure of data from a South Korean nuclear plant. 

Nonstate Actors. Terrorists continue to use the Internet to organize, recruit, spread propaganda, collect 

intelligence, raise funds, and coordinate operations. In a new tactic, ISIL actors targeted and released 

sensitive information about US military personnel in 2015 in an effort to spur "lone-wolf' attacks. 

Criminals develop and use sophisticated cyber tools for a variety of purposes such as theft, extortion, and 

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facilitation of other criminal activities such as drug trafficking. "Ransom ware· designed to block user 

access to their own data, sometimes by encrypting it, is becoming a particularly effective and popular tool 

for extortion for which few options for recovery are available. Criminal tools and malware are increasingly 

being discovered on state and local government networks. 

TERRORISM 

The United States and its allies are facing a challenging threat environment in 2016. Sunni violent 

extremism has been on an upward trajectory since the late 1970s and has more groups, members, and 

safe havens than at any other point in history. At the same time, Shia violent extremists will probably 

deepen sectarian tensions in response to real and perceived threats from Sunni violent extremists and to 

advance Iranian influence. 

The Islamic State of Iraq and the Levant (ISIL) has become the preeminent terrorist threat because of its 

self-described caliphate in Syria and Iraq, its branches and emerging branches in other countries, and its 

increasing ability to direct and inspire attacks against a wide range of targets around the world. ISIL's 

narrative supports jihadist recruiting, attracts others to travel to Iraq and Syria, draws individuals and 

groups to declare allegiance to ISIL, and justifies attacks across the globe. The ISIL-directed November 

2015 attacks in Paris and ISIL-Sinai's claim of responsibility for the late October downing of a Russian 

airliner in the Sinai underscore these dynamics. 

AI-Qa'ida's affiliates have proven resilient and are positioned to make gains in 2016, despite 

counterterrorism pressure that has largely degraded the network's leadership in Afghanistan and 

Pakistan. They will continue to pose a threat to local, regional, and even possibly global interests as 

demonstrated by the January 2015 attack on French satirical newspaper Charlie Hebda by individuals 

linked to ai-Qa'ida in the Arabian Peninsula (AQAP). Other Sunni terrorist groups retain the ability to 

attract recruits and resources. 

The United States will almost certainly remain at least a rhetorically important enemy for most violent 

extremists in part due to past and ongoing US military, political, and economic engagement overseas. 

Sunni violent extremists will probably continually plot against US interests overseas. A smaller number 

will attempt to overcome the logistical challenges associated with conducting attacks on the US 

homeland. The July 2015 attack against military facilities in Chattanooga and December 2015 attack in 

San Bernardino demonstrate the threat that homegrown violent extremists (HVEs) also pose to the 

homeland. In 2014, the FBI arrested approximately one dozen US-based ISIL supporters. In 2015, that 

number increased to approximately five dozen arrests. These individuals were arrested for a variety of 

reasons, predominantly for attempting to provide material support to ISIL. 

US-based HVEs will probably continue to pose the most significant Sunni terrorist threat to the US 

homeland in 2016. The perceived success of attacks by HVEs in Europe and North America, such as 

those in Chattanooga and San Bernardino, might motivate others to replicate opportunistic attacks with 

little or no warning, diminishing our ability to detect terrorist operational planning and readiness. ISIL 

involvement in homeland attack activity will probably continue to involve those who draw inspiration from 

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the group's highly sophisticated media without direct guidance from ISIL leadership and individuals in the 

United States or abroad who receive direct guidance and specific direction from ISIL members or leaders. 

ISIL's global appeal continues to inspire individuals in countries outside Iraq and Syria to travel to join the 

group. More than 36,500 foreign fighters-including at least 6,600 from Western countries-have 

traveled to Syria from more than100 countries since the conflict began in 2012. Foreign fighters who 

have trained in Iraq and Syria might potentially leverage skills and experience to plan and execute attacks 

in the West. Involvement of returned foreign fighters in terrorist plotting increases the effectiveness and 

lethality of terrorist attacks, according to academic studies. A prominent example is the November 2015 

attacks in Paris in which the plotters included European foreign fighters returning from Syria. 

ISIL's branches continue to build a strong global network that aims to advance the group's goals and 

often works to exacerbate existing sectarian tensions in their localities. Some of these branches will also 

plan to strike at Western targets, such as the downing of a Russian airliner in October by ISIL's selfproclaimed province in Egypt. In Libya, the group is entrenched in Surt and along the coastal areas, has 

varying degrees of presence across the country, and is well positioned to expand territory under its 

control in 2016. ISIL will seek to influence previously established groups, such as Boko Haram in Nigeria, 

to emphasize the group's ISIL identity and fulfill its religious obligations to the ISIL "caliphate." 

Other terrorists and insurgent groups will continue to exploit weak governance, insecurity, and economic 

and political fragility in an effort to expand their areas of influence and provide safe havens for violent 

extremists, particularly in conflict zones. Sunni violent extremist groups are increasingly joining or 

initiating insurgencies to advance their local and transnational objectives. Many of these groups are 

increasingly capable of conducting effective insurgent campaigns, given their membership growth and 

accumulation of large financial and materiel caches. This trend increasingly blurs the lines between 

insurgent and terrorist groups as both aid local fighters, leverage safe havens, and pursue attacks against 

US and other Western interests. 

No single paradigm explains how terrorists become involved in insurgencies. Some groups like ISIL in 

Syria and al-Qa'ida in the Islamic Maghreb (AQIM) in Mali have worked with local militants to incite 

insurgencies. Others, like Boko Haram, are the sole instigators and represent the primary threat to their 

respective homeland's security. Still others, including ai-Shabaab, are the primary beneficiaries of an 

insurgency started by others. Finally, other groups, such as core al-Qa'ida, have taken advantage of the 

relative safe haven in areas controlled by insurgent groups to build capabilities and alliances without 

taking on a primary leadership role in the local conflict. 

Although ai-Qa'ida's presence in Afghanistan and Pakistan has been significantly degraded, it aspires to 

attack the US and its allies. In Yemen, the proven capability of AQAP to advance external plots during 

periods of instability suggests that leadership losses and challenges from the Iranian-backed Huthi 

insurgency will not deter its efforts to strike the West. Amid this conflict, AQAP has made territorial gains 

in Yemen including the seizure of military bases in the country's largest province. AI-Qa'ida nodes in 

Syria, Pakistan, Afghanistan, and Turkey are also dedicating resources to planning attacks. Al-Shabaab, 

ai-Qaida's affiliate in East Africa, continues its violent insurgency in southern and central Somalia despite 

losses of territory and influence and conflict among senior leaders. 

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Iran-the foremost state sponsor of terrorism-continues to exert its influence in regional crises in the 

Middle East through the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), its terrorist partner 

Lebanese Hizballah, and proxy groups. It also provides military and economic aid to its allies in the 

region. Iran and Hizballah remain a continuing terrorist threat to US interests and partners worldwide. 

Terrorists will almost certainly continue to benefit in 2016 from a new generation of recruits proficient in 

information technology, social media, and online research. Some terrorists will look to use these 

technologies to increase the speed of their communications, the availability of their propaganda, and 

ability to collaborate with new partners. They will easily take advantage of widely available, free 

encryption technology, mobile-messaging applications, the dark web, and virtual environments to pursue 

their objectives. 

Long-term economic, political, and social problems, as well as technological changes, will contribute to 

the terrorist threat worldwide. A record-setting 60 million internally displaced persons (lOPs) and 

refugees as of 2014-one half of whom are children, according to the United Nations-will stress the 

capacity of host nations already dealing with problems relating to assimilation and possibly make 

displaced populations targets for recruitment by violent extremists. Among Sunni violent extremist 

groups, ISIL is probably most proficient at harnessing social media to disseminate propaganda and solicit 

recruits among a broad audience. It is likely to continue these activities in 2016 by using videos, photos, 

and other propaganda glorifying life under ISIL rule and promoting the group's military successes. In 

addition, violent extremist supporters will probably continue to publicize their use of encrypted messaging 

applications on social media to let aspiring violent extremists know that secure avenues are available by 

which they can communicate. 

The acute and enduring nature of demographic, economic, political, social, and technological factors 

contribute to the motivation of individuals and groups and their participation in violent extremist activities. 

These factors ensure that terrorism will remain one of several primary national security challenges for the 

United States in 2016. 

WEAPONS OF MASS DESTRUCTION AND PROLIFERATION 

Nation-state efforts to develop or acquire weapons of mass destruction (WMD), their delivery systems, or 

their underlying technologies constitute a major threat to the security of the United States, its deployed 

troops, and allies. Use of chemical weapons in Syria by both state and nonstate actors demonstrates that 

the threat of WMD is real. Biological and chemical materials and technologies, almost always dual use, 

move easily in the globalized economy, as do personnel with the scientific expertise to design and use 

them. The latest discoveries in the life sciences also diffuse rapidly around the globe. 

North Korea Developing WMD-Applicable Capabilities 

North Korea's nuclear weapons and missile programs will continue to pose a serious threat to US 

interests and to the security environment in East Asia in 2016. North Korea's export of ballistic missiles 

and associated materials to several countries, including Iran and Syria, and its assistance to Syria's 

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construction of a nuclear reactor, destroyed in 2007, illustrate its willingness to proliferate dangerous 

technologies. 

We judge that North Korea conducted a nuclear test on 6 January 2016 that it claimed was a successful 

test of a "hydrogen bomb." Although we are continuing to evaluate this event, the low yield of the test is 

not consistent with a successful test of a thermonuclear device. In 2013, following North Korea's third 

nuclear lest, Pyongyang announced its intention to "refurbish and restart" its nuclear facilities, to include 

the uranium enrichment facility at Yongbyon and its graphite-moderated plutonium production reactor, 

which was shut down in 2007. We assess that North Korea has followed through on its announcement by 

expanding its Yongbyon enrichment facility and restarting the plutonium production reactor. We further 

assess that North Korea has been operating the reactor long enough so thalli could begin to recover 

plutonium from the reactor's spent fuel within a matter of weeks to months. 

North Korea has also expanded the size and sophistication of its ballistic missile forces-from closerange ballistic missiles to intercontinental ballistic missiles (ICBMs}-and continues to conduct test 

launches. In May 2015, North Korea claimed that it successfully tested a ballistic missile from a 

submarine. Pyongyang is also committed to developing a long-range, nuclear-armed missile that is 

capable of posing a direct threat to the United States; it has publicly displayed its KN08 road-mobile ICBM 

on multiple occasions. We assess that North Korea has already taken initial steps toward fielding this 

system, although the system has not been flight-tested. 

Although North Korea issues official statements that include its justification for building nuclear weapons 

and threats to use them as a defensive or retaliatory measure, we do not know the details of Pyongyang's 

nuclear doctrine or employment concepts. We have long assessed that Pyongyang's nuclear capabilities 

are intended for deterrence, international prestige, and coercive diplomacy. 

China Modernizing Nuclear Forces 

The Chinese People's Liberation Army's (PLA's) has established a Rocket Force-replacing the 

longstanding Second Artillery Corps-and continues to modernize its nuclear missile force by adding 

more survivable road-mobile systems and enhancing its silo-based systems. This new generation of 

missiles is intended to ensure the viability of China's strategic deterrent by providing a second-strike 

capability. In addition, the PLA Navy continues to develop the JL-2 submarine-launched ballistic missile 

(SLBM) and might produce additional JIN-class nuclear-powered ballistic missile submarines. The JINclass submarines-armed with JL-2 SLBMs-will give the PLA Navy its first long-range, sea-based 

nuclear capability. 

Russian Cruise Missile Violates the INF Treaty 

Russia has developed a ground-launched cruise missile that the United States has declared is in violation 

of the Intermediate-Range Nuclear Forces (INF) Treaty. Russia has denied it is violating the INF Treaty. 

In 2013, a senior Russian administration official stated publicly that the world had changed since the INF 

Treaty was signed 1987 and noted that Russia was "developing appropriate weapons systems" in light of 

the proliferation of intermediate· and shorter-range ballistic missile technologies around the world, and 

Russian officials have made statements in the past regarding the unfairness of a Treaty that prohibits 

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Russia, but not some of its neighbors, from developing and processing ground-launched missiles with 

ranges between 500 to 5,500 kilometers. 

Chemical Weapons in Syria and Iraq 

We assess that Syria has not declared ail the elements of its chemical weapons program to the Chemical 

Weapons Convention (CWC). Despite the creation of a specialized team and months of work by the 

Organization for the Prohibition of Chemical Weapons (OPCW) to address gaps and inconsistencies in 

Syria's declaration, numerous issues remain unresolved. Moreover, we continue to judge that the Syrian 

regime has used chemicals as a means of warfare since accession to the CWC in 2013. The OPCW 

Fact-Finding Mission has concluded that chlorine had been used on Syrian opposition forces in multiple 

incidents in 2014 and 2015. Helicopters-which only the Syrian regime possesses--were used in several 

of these attacks. 

We assess that nonstate actors in the region are also using chemicals as a means of warfare. The 

OPCW investigation into an alleged ISIL attack in Syria in August led it to conclude that at least two 

people were exposed to sulfur mustard. We continue to track numerous allegations of ISIL's use of 

chemicals in attacks in Iraq and Syria, suggesting that attacks might be widespread. 

Iran Adhering to Deal To Preserve Capabilities and Gain Sanctions Relief 

Iran probably views the Joint Comprehensive Plan of Action (JCPOA) as a means to remove sanctions 

while preserving some of its nuclear capabilities, as well as the option to eventually expand its nuclear 

infrastructure. We continue to assess that Iran's overarching strategic goals of enhancing its security, 

prestige, and regional influence have led it to pursue capabilities to meet its nuclear energy and 

technology goals and give it the ability to build missile-deliverable nuclear weapons, if it chooses to do so. 

Its pursuit of these goals will dictate its level of adherence to the JCPOA over time. We do not know 

whether Iran will eventually decide to build nuclear weapons. 

We also continue to assess that Iran does not face any insurmountable technical barriers to producing a 

nuclear weapon, making Iran's political will the central issue. Iran's implementation of the JCPOA, 

however, has extended the amount of time Iran would need to produce fissile material for a nuclear 

weapon from a few months to about a year. The JCPOA has also enhanced the transparency of Iran's 

nuclear activities, mainly through improved access by the International Atomic Energy Agency (IAEA) and 

investigative authorities under the Additional Protocol to its Comprehensive Safeguard Agreement 

As a result, the international community is well postured to quickly detect changes to Iran's declared 

nuclear facilities designed to shorten the time Iran would need to produce fissile material. Further, the 

JCPOA provides tools for the IAEA to investigate possible breaches of prohibitions on specific R&D 

activities that could contribute to the development of a nuclear weapon. 

We judge that Tehran would choose ballistic missiles as its preferred method of delivering nuclear 

weapons, if it builds them. Iran's ballistic missiles are inherently capable of delivering WMD, and Tehran 

already has the largest inventory of ballistic missiles in the Middle East. Iran's progress on space launch 

vehicles--along with its desire to deter the United Stales and its allies-provides Tehran with the means 

and motivation to develop longer-range missiles, including ICBMs. 

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Genome Editing 

Research in genome editing conducted by countries with different regulatory or ethical standards than 

those of Western countries probably increases the risk of the creation of potentially harmful biological 

agents or products. Given the broad distribution, low cost, and accelerated pace of development of this 

dual-use technology, its deliberate or unintentional misuse might lead to far-reaching economic and 

national security implications. Advances in genome editing in 2015 have compelled groups of high-profile 

US and European biologists to question unregulated editing of the human germ line (cells that are relevant 

for reproduction), which might create inheritable genetic changes. Nevertheless, researchers will 

probably continue to encounter challenges to achieve the desired outcome of their genome modifications, 

in part because of the technical limitations that are inherent in available genome editing systems. 

SPACE AND COUNTERSPACE 

Space 

Global Trends. Changes in the space sector will evolve more quickly in the next few years as innovation 

becomes more ubiquitous, driven primarily by increased availability of technology and growing private 

company investment. The number of space actors is proliferating, with 80 countries participating in space 

activities and more expected in the next few years. New entrants from the private space sectorleveraging lowering costs in aerospace technology and innovations in other technology sectors, such as 

big data analytics, social media, automation, and additive manufacturing-will increase global access to 

space-enabled applications, such as imaging, maritime automatic identification system (AIS), weather. 

Internet, and communications. 

Military and Intelligence. Foreign governments will expand their use of space services-to include 

reconnaissance, communications, and position, navigation, and timing (PNT)-for military and 

intelligence purposes, beginning to rival the advantages space-enabled services provide the United 

Stales. Russia and China continue to improve the capabilities of their military and intelligence satellites 

and grow more sophisticated in their operations. Russian military officials publicly tout their use of 

imaging and electronic-reconnaissance satellites to support military operations in Syria-revealing some 

of their sophisticated military uses of space services. 

Counters pace 

Threats to our use of military, civil, and commercial space systems will increase in the next few years as 

Russia and China progress in developing counterspace weapon systems to deny, degrade, or disrupt US 

space systems. Foreign military leaders understand the unique advantages that space-based systems 

provide to the United Slates. Russia senior leadership probably views countering the US space 

advantage as a critical component of warfighting. Its 2014 Military Doctrine highlights at least three 

space-enabled capabilities-"global strike," the "intention to station weapons in space," and "strategic 

non-nuclear precision weapons" -as main external military threats to the Russian Federation. Russia 

and China are also employing more sophisticated satellite operations and are probably testing dual-use 

technologies in space that could be applied to counterspace missions. 

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Deny and Disrupt. We already face a global threat from electronic warfare systems capable of jamming 

satellite communications systems and global navigation space systems. We assess that this technology 

will continue to proliferate to new actors and that our more advanced adversaries will continue to develop 

more sophisticated systems in the next few years. Russian defense officials acknowledge that they have 

deployed radar-imagery jammers and are developing laser weapons designed to blind US intelligence 

and ballistic missile defense satellites. 

Destroy. Russia and China continue to pursue weapons systems capable of destroying satellites on 

orbit, placing US satellites at greater risk in the next few years. China has probably made progress on 

the antisatellite missile system that it tested in July 2014. The Russian Duma officially recommended in 

2013 that Russia resume research and development of an airborne antisatellite missile to "be able to 

intercept absolutely everything that flies from space." 

COUNTERINTELLIGENCE 

The United States will continue to face a complex foreign intelligence threat environment in 2016. We 

assess that the leading state intelligence threats to US interests will continue to be Russia and China, 

based on their capabilities, intent, and broad operational scope. Other states in South Asia, the Near 

East, East Asia, and Latin America will pose local and regional intelligence threats to US interests. For 

example, Iranian and Cuban intelligence and security services continue to view the United States as a 

primary threat. 

Penetrating and influencing the US national decisionmaking apparatus and Intelligence Community will 

remain primary objectives for numerous foreign intelligence entities. Additionally, the targeting of national 

security information and proprietary information from US companies and research institutions involved 

with defense, energy, finance, dual-use technology, and other sensitive areas will remain a persistent 

threat to US interests. 

Insiders who disclose sensitive US Government information without authorization will remain a significant 

threat in 2016. The sophistication and availability of information technology that can be used for 

nefarious purposes exacerbate this threat both in terms of speed and scope of impact. 

Nonstate entities, including international terrorist groups and transnational organized crime organizations, 

will continue to employ and potentially improve their intelligence capabilities, which include human, cyber, 

and technical means. Like state intelligence services, these nonstate entities recruit human sources and 

conduct physical and technical surveillance to facilitate their activities and avoid detection and capture. 

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TRANSNATIONAL ORGANIZED CRIME 

Some US Drug Threats Are Growing 

Transnational drug trafficking poses a strong and in many cases growing threat to the United States at 

home and to US securny interests abroad. Supplies of some foreign-produced drugs in the United States 

are rising, and some criminals who market them are growing more sophisticated. 

Mexican drug traffickers, capitalizing on the strong US demand for heroin, have increased heroin 

production significantly since 2007. US border seizures nearly doubled between 2010 and 2014. 

Some Mexican trafficking groups-which collectively supply most of the heroin consumed in the 

United States-have mastered production of the white heroin preferred in eastern US cities and have 

been boosting overall drug potency by adding fentanyl. Fentanyl, which is 30 to 50 times more potent 

than heroin, is sometimes used as an adulterant and mixed with lower-grade heroin to increase its 

effects or mixed with diluents and sold as "synthetic heroin" with or without the buyers' knowledge. 

Mexican traffickers have probably increased their production of the stimulant methamphetamine for 

the US market. US border seizures of the drug rose by nearly half between 2013 and 2014. 

Traffickers in the Andean countries have increased their manufacture of cocaine. Producers in 

Colombia-from which most US cocaine originates-increased output by nearly a third in 2014 over 

the prior year. Cocaine output will probably rise again in 2016 as previously planted coca crops fully 

mature. 

US availability of some new psychoactive substances-so-called "designer drugs" typically produced 

in Asia-has been increasing; UN scientists have identified more than 500 unique substances. 

Transnational Organized Crime Groups Target Vulnerable States 

Transnational organized crime groups will pose a persistent and at times sophisticated threat to the 

wealth, health, and security of people around the globe. Criminal groups' untaxed and unregulated 

enterprises drain state resources, crowd out legitimate commerce, increase official corruption, and 

impede economic competitiveness and fair trade. On occasion, transnational organized crime groups 

threaten countries' security, spur increases in social violence, or otherwise reduce governability. 

Profit-minded criminals generally do not seek the reins of political power but rather to suborn, co-opt, 

or bully government officials in order to create environments in which criminal enterprise can thrive. 

Foreign-based transnational criminals are increasingly using online information systems to breach 

sovereign borders virtually, without the need to send criminal operatives abroad to advance illicit 

businesses. 

Organized crime and rebel groups in Africa and elsewhere are likely to increase their involvement in 

wildlife trafficking to fund political activities, enhance political influence, and purchase weapons. Illicit 

trade in wildlife, timber, and marine resources endangers the environment, threatens good 

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governance and border security in fragile regions, and destabilizes communities whose economic 

well-being depends on wildlife for biodiversity and ecotourism. Increased demand for ivory and rhino 

horn in East Asia has triggered unprecedented increases in poaching in Sub-Saharan Africa. 

Human trafficking exploits and abused individuals and challenges international security. Human 

traffickers leverage corrupt officials, porous borders, and lax enforcement to orchestrate their illicit trade. 

This exploitation of human lives for profit continues to occur in every country in the world-undermining 

the rule of law and corroding legitimate institutions of government and commerce. Trafficking in persons 

has become a lucrative source of revenue for transnational organized crime groups and terrorist 

organizations and is estimated to produce tens of billions of dollars annually. For example, terrorist or 

armed groups-such as ISIL, the lord's Resistance Army, and Boko Haram-engage in kidnapping for 

the purpose of sexual slavery, sexual exploitation, and forced labor. These activities might also 

contribute to the funding and sustainment of such groups. 

We assess that the ongoing global migration crises-a post-WWII record 60 million refugees and 

internally displaced persons-will fuel an increase in the global volume of human trafficking victims as 

men, women, and children undertake risky migration ventures and fall prey to sex trafficking, forced labor, 

debt bondage and other trafficking crimes. This continuing rise in global displacement and dangerous 

migration, both forced and opportunistic movements within countries and across national borders, will 

probably allow criminal groups and terrorist organizations to exploit vulnerable populations. 

ECONOMICS AND NATURAL RESOURCES 

Global economic growth will probably remain subdued, in part because of the deceleration of China's 

economy. During 2015, preliminary figures indicate that worldwide GDP growth slipped to 3.1 percent, 

down from 3.4 percent the previous year, although advanced economies as a group enjoyed their 

strongest GDP growth since 2010 at nearly 2 percent. However, developing economies, which were 

already dealing with broad and sharp commodity-price declines that began in 2014, saw the first net 

capital outflows to developed countries since the late 1980s. 

GDP growth for these economies was 4 percent in 2015, the lowest since 2009. The International 

Monetary Fund (IMF) is forecasting a slight growth upturn in 2016 but downgraded its forecast in January 

for both developed and developing economies. Adverse shocks such as financial instability In emerging 

markets, a steeper-than-expected slowdown in China's growth, or renewed uncertainty about Greece's 

economic situation, might prevent the predicted gradual increase in global growth. 

Macroeconomic Stability 

Continued solid performance by the United States and the resumption of growth for many European 

states, even as the region continues to wrestle with the Greek debt crisis, will probably help boost growth 

rates for developed economies. However, increasing signs of a sustained deceleration of Chinese 

economic growth-particularly in sectors that are the most raw-material intensive-contributed to a 

continued decline in energy and commodity prices worldwide in 2015. Emerging markets and developing 

countries' difficulties were compounded by the declines in foreign investment inflows and increases in 

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resident capital outflows. The prospect of higher growth and interest rates in the United States is spurring 

net capital outflows from these countries, estimated to be more than $700 billion in 2015, compared to an 

average yearly inflow of more than $400 billion from 2009 to 2014. The global slowdown in trade is also 

contributing to a more difficult economic environment for many developing economies and might worsen if 

efforts to advance trade liberalization through the World Trade Organization (WTO) and regional trade 

deals stall. 

Energy and Commodities 

Weak energy and commodity prices have been particularly hard on key exporters in Latin America; 

Argentina and Brazil experienced negative growth and their weakened currencies contributed to domestic 

inflation. A steeply declining economy in Venezuela-the result of the oil-price decline and years of poor 

economic policy and profligate government spending-will leave Caracas struggling to avoid defaun in 

2016. Similarly, in Africa, declining oil revenues and past mismanagement have contributed to Angolan 

and Nigerian fiscal problems, currency strains, and deteriorating external balances. Falling prices have 

also forced commodity-dependent exporters, such as Ghana, Liberia, and Zambia, to make sharp budget 

cuts to contain deficits. Persian Gulf oil exporters, which generally have more substantial financial 

reserves, have nonetheless seen a sharp increase in budget deficits. 

Declining energy prices and substantial increases in North American production have also discouraged 

initiatives to develop new resources and expand existing projects-including in Brazil, Canada, Iraq, and 

Saudi Arabia. They typically take years to complete, potentially setting the stage for shortfalls in coming 

years when demand recovers. 

Arctic 

Diminishing sea ice is creating increased economic opportunities in the region and simultaneously raising 

Arctic nations' concerns about safety and the environment. Harsh weather and longer-term economic 

stakes have encouraged cooperation among the countries bordering the Arctic. As polar ice recedes and 

resource extraction technology improves, however, economic and security concerns will raise the risk of 

increased competition between Arctic and non-Arctic nations over access to sea routes and resources. 

Sustained low oil prices would reduce the attractiveness of potential Arctic energy resources. Russia will 

almost certainly continue to bolster its military presence along its northern coastline to improve its 

perimeter defense and control over its exclusive economic zone (EEZ). It will also almost certainly 

continue to seek international support for its extended continental shelf claim and its right to manage ship 

traffic within its EEZ. Moscow might become more willing to disavow established international processes 

or organizations concerning Arctic governance and act unilaterally to protect these interests if RussianWestern relations deteriorate further. 

HUMAN SECURITY 

Environmental Risks and Climate Change 

Extreme weather, climate change, environmental degradation, related rising demand for food and water, 

poor policy responses, and inadequate critical infrastructure will probably exacerbate-and potentially 

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spark-political instability, adverse health conditions, and humanitarian crises in 2016. Several of these 

developments, especially those in the Middle East, suggest that environmental degradation might 

become a more common source for interstate tensions. We assess that almost all of the 194 countries 

that adopted the global climate agreement at the UN climate conference in Paris in December 2015 view 

it as an ambitious and long-lasting framework. 

The UN World Meteorological Organization (WMO) report attributes extreme weather events in the 

tropics and sub-tropical zones in 2015 to both climate change and an exceptionally strong El Nino 

that will probably persist through spring 2016. An increase in extreme weather events is likely to 

occur throughout this period, based on WMO reporting. Human activities, such as the generation of 

greenhouse gas emissions and land use, have contributed to extreme weather events including more 

frequent and severe tropical cyclones, heavy rainfall, droughts, and heat waves, according to a 

November 2015 academic report with contributions from scientists at the National Oceanic and 

Atmospheric Administration (NOAA). Scientists have more robust evidence to identify the influence 

of human activity on temperature extremes than on precipitation extremes. 

The Paris climate change agreement establishes a political expectation for the first time that all 

countries will address climate change. The response to the deal has been largely positive among 

government officials and nongovernmental groups, probably because the agreement acknowledges 

the need for universal action to combat climate change along with the development needs of lowerincome countries. However, an independent team of climate analysts and the Executive Secretary of 

the UN climate forum have stated that countries' existing national plans to address climate change 

will only limit temperature rise to 2.7 degrees Celsius by 2100. 

Health 

Infectious diseases and vulnerabilities in the global supply chain for medical countermeasures will 

continue to pose a danger to US national security in 2016. Land-use changes will increase animal-tohuman interactions and globalization will raise the potential for rapid cross-regional spread of disease, 

while the international community remains ill prepared to collectively coordinate and respond to disease 

threats. Influenza viruses, coronaviruses such as the one causing Middle Eastern Respiratory Syndrome 

(MERS), and hemorrhagic fever viruses such as Ebola are examples of infectious disease agents that are 

passed from animals to humans and can quickly pose regional or global threats. Zika virus, an emerging 

infectious disease threat first detected in the Western Hemisphere in 2014, is projected to cause up to 4 

million cases in 2016; it will probably spread to virtually every country in the hemisphere. Although the 

virus is predominantly a mild illness, and no vaccine or treatment is available, the Zika virus might be 

linked to devastating birth defects in children whose mothers were infected during pregnancy. Many 

developed and developing nations rernain unable to implement coordinated plans of action to prevent 

infectious disease outbreaks, strengthen global disease surveillance and response, rapidly share 

information, develop diagnostic tools and countermeasures, or maintain the safe transit of personnel and 

materials. 

Human encroachment into animal habitats, including clearing land for farm use and urbanization, is 

recognized as a contributing factor in the emergence of new infectious diseases. The populations of 

Asia and Africa are urbanizing and growing faster than those of any other region, according to the 

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UN. Emerging diseases against which humans have no preexisting immunity or effective therapies 

pose significant risks of becoming pandemics. 

Atrocities and Instability 

Risks of atrocities, large-scale violence, and regime-threatening instability will remain elevated in 2016. A 

vicious cycle of conflict resulting from weak governance, the rise of violent non-state actors, insufficient 

international capacity to respond to these complex challenges, and an increase in global migration all 

contribute to global security risks. Weak global growth, particularly resulting from the cascading effect of 

slower Chinese growth that will hurt commodity exporters, will also exacerbate risk. 

Regional spillover will probably spread. For example, the long-term impact of civil war in Syria is 

reinforcing sectarian differences in Iraq, and the flight of Syrians to Turkey, Jordan, and Lebanon, and 

then onward to Europe is sowing regional tensions and straining national governments. 

As of 2015, the central governments of seven slates are unable to project authority and provide 

goods and services throughout at least 50 percent of their respective territory; this number is the 

largest at any point in the past 60 years. 

The risk of waning support for universal human rights norms is increasing as authoritarian regimes 

push back against human rights in practice and in principle. 

Global Displacement 

Europe will almost certainly continue to face record levels of arriving refugees and other migrants in 2016 

unless the drivers causing this historic movement toward the continent change significantly in 2016, which 

we judge is unlikely. Migration and displacement will also probably be an issue within Asia and Africa as 

well as the Americas. In total, about 60 million people are displaced worldwide, according to the UN High 

Commissioner for Refugees (UNHCR). These 60 million consist of approximately 20 million refugees, 38 

million internally displaced persons (lOPs}, and approximately 2 million stateless persons, also according 

to UNHCR statistics. 

Wars, weak border controls, and relatively easy and affordable access to routes and information are 

driving this historic increase In mobility and displacement. 

The growing scope and scale of human displacement will probably continue to strain the response 

capacity of the international community and drive a record level of humanitarian requests. At the same 

time, host and transit countries will struggle to develop effective responses and, in some cases, manage 

domestic fears of terrorists exploiting migrant flows after the Paris attacks in November 2015. 

In 2015, the UN received less than half of its requested funding for global assistance, suggesting that 

the UN's 2016 request is also likely to be underfunded. 

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REGIONAL THREATS 

Emerging trends suggest that geopolitical competition among the major powers is increasing in ways that 

challenge international norms and institutions. Russia, in particular, but also China seek greater influence 

over their respective neighboring regions and want the United States to refrain from actions they perceive 

as interfering with their interests-which will perpetuate the ongoing geopolitical and security competition 

around the peripheries of Russia and China, to include the major sea lanes. They will almost certainly 

eschew direct military conflict with the United States in favor of contests at lower levels of competition-to 

include the use of diplomatic and economic coercion, propaganda, cyber intrusions, proxies, and other 

indirect applications of military power-that intentionally blur the distinction between peace and wartime 

operations. 

Although major power competition is increasing, the geopolitical environment continues to offer 

opportunities for US cooperation. In addition, despite the prospect for increased competition, the major 

powers, including Russia and China, will have incentives to continue to cooperate with the United States 

on issues of shared interest that cannot be solved unilaterally. A future international environment defined 

by a mix of competition and cooperation among major powers, however, will probably encourage ad-hoc 

approaches to global challenges that undermine existing international institutions. 

EAST ASIA 

China 

China will continue to pursue an active foreign policy-especially within the Asia Pacific--highlighted by a 

firm stance on competing territorial claims in the East and South China Seas, relations with Taiwan, and 

its pursuit of economic engagement across East Asia. Regional tension will continue as China pursues 

construction at its expanded outposts in the South China Sea and because competing claimants might 

pursue actions that others perceive as infringing on their sovereignly. Despite the meeting between 

China's and Taiwan's Presidents in November 2015, Chinese leaders will deal with a new president from 

a different party in Taiwan following elections in January. China will also pursue efforts aimed at fulfilling 

its "One Belt, One Road" initiative to expand China's economic role and outreach across Asia. 

China will continue to incrementally increase its global presence. Mileposts have included symbolic and 

substantive developments, such as the IMF's decision in November 2016 to incorporate the renminbi into 

its Special Drawing Rights currency basket and China's opening of the Asian Infrastructure Investment 

Bank in early 2016. China will increasingly be a factor in global responses to emerging problems, as 

illustrated by China's participation in UN peacekeeping operations, WHO's Ebola response, and 

infrastructure construction in Africa and Pakistan. 

Amid new economic challenges, Chinese leaders are pursuing an ambitious agenda of economic, legal, 

and military reforms aimed at bolstering the country's long-term economic growth potential, improving 

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government efficiency and accountability, and strengthening the control of the Communist Party. The 

scope and scale of the reform agenda-coupled with an ongoing anti-corruption campaign-might 

increase the potential for internal friction within China's ruling Communist Party. Additionally, China's 

leaders, who have declared slower economic growth to be the "new normal," will nonetheless face 

pressure to stabilize growth at levels that still support strong job creation. 

Southeast Asia 

Regional integration via the Association of Southeast Asian Nations (ASEAN) made gains in 2015 with 

the establishment of the ASEAN Community. However, ASEAN cohesion on economic and security 

issues will continue to face challenges stemming from differing development levels among ASEAN 

members and their varying threat perceptions of China's regional ambitions and assertiveness in the 

South China Sea. 

Democracy in many Southeast Asian nations remains fragile. Elites-rather than the populace-retain a 

significant level of control and often shape governance reforms to benefit their individual interests rather 

than to promote democratic values. Corruption and cronyism continue to be rampant in the region, and 

the rising threat of ISIL might provide some governments with a new rationale to not only address the 

terrorist threat but also curb opposition movements, like some leaders in the region did in the post 9/11 

environment. The new National League for Democracy-led government in Burma is poised to continue 

the country's democratic transition process, but given its lack of governing experience, the learning curve 

will be steep. The Burmese constitution also ensures that the military will retain a significant level of 

power in the government, hampering the NLD to put its own stamp on the ongoing peace process. In 

Thailand, the military-led regime is positioned to remain in power through 2017. 

North Korea 

Since taking the helm of North Korea in December 2011, Kim Jong Un has further solidified his position 

as the unitary leader and final decision authority through purges, executions, and leadership shuffles. 

Kim and the regime have publicly emphasized-and codified-North Korea's focus on advancing its 

nuclear weapons program, developing the country's troubled economy, and improving the livelihood of 

the North Korean people, while maintaining the tenets of a command economy. Despite efforts at 

diplomatic outreach, Kim continues to challenge the international community with provocative and 

threatening behavior in pursuit of his goals, as prominently demonstrated in the November 2014 

cyberattack on Sony, the August 2015 inter-Korean confrontation spurred by the North's placement of 

landmines that injured two South Korean soldiers, and the fourth nuclear test in January 2016. 

RUSSIA AND EURASIA 

Russia 

Moscow's more assertive foreign policy approach, evident in Ukraine and Syria, will have far-reaching 

effects on Russia's domestic politics, economic development, and military modernization efforts. 

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President Vladimir Putin has sustained his popular approval at or near record highs for nearly two years 

after illegally annexing Crimea. Nevertheless, the Kremlin's fears of mass demonstration remain high, 

and the government will continue to rely on repressive tactics to defuse what it sees as potential catalysts 

for protests in Russia. The Kremlin's fear of instability and its efforts to contain it will probably be 

especially acute before the September 2016 Duma election. 

The Russian economy will continue to shrink as a result of longstanding structural problems-made 

worse by low energy prices and economic sanctions-and entered into recession in 2015. A consensus 

forecast projects that GDP will contract by 3.8 percent in 2015 and will probably decline between 2-3 

percent in 2016 if oil prices remain around $40 per barrel or only 0.6 percent if oil returns to $50 per 

barrel. Real wages declined throughout most of 2015 and the poverty rate and inflation have also 

worsened. 

We assess that Putin will continue to try to use the Syrian conflict and calls for cooperation against ISIL to 

promote Russia's Great Power status and end its international isolation. Moscow's growing concern 

about ISIL and other extremists has led to direct intervention on the side of Bashar ai-Asad's regime and 

efforts to achieve a political resolution to the Syrian conflict on Russia's terms. Since the terrorist attacks 

in Paris and over the Sinai, Russia has redoubled its calls for a broader anti-terrorism coalition. 

Meanwhile, growing Turkish-Russian tensions since Turkey's shootdown of a Russian jet in November 

2015 raise the specter of miscalculation and escalation. 

Despite Russia's economic slowdown, the Kremlin remains intent on pursuing an assertive foreign policy 

in 2016. Russia's willingness to covertly use military and paramilitary forces in a neighboring state 

continues to cause anxieties in states along Russia's periphery, to include NATO allies. Levels of 

violence in eastern Ukraine have decreased, but Moscow's objectives in Ukraine-maintaining long-term 

influence over Kyiv and frustrating Ukraine's attempts to integrate into Western institutions-will probably 

remain unchanged in 2016. 

Since the crisis began in Ukraine in 2014, Moscow has redoubled its efforts to reinforce its influence in 

Eurasia. Events in Ukraine raised Moscow's perceived stakes for increasing its presence in the region to 

prevent future regime change in the former Soviet republics and for accelerating a shift to a mulitpolar 

world in which Russia is the uncontested regional hegemon in Eurasia. Moscow will therefore continue to 

push for greater regional integration, raising pressure on neighboring states to follow the example of 

Armenia, Belarus, Kazakhstan, and Kyrgyzstan and join the Moscow-led Eurasian Economic Union. 

Moscow's military foray into Syria marks its first use of significant expeditionary combat power outside the 

post-Soviet space in decades. Its intervention underscores both the ongoing and substantial 

improvements in Russian military capabilities and the Kremlin's confidence in using them as a tool to 

advance foreign policy goals. Despite its economic difficulties, Moscow remains committed to 

modernizing its military. 

Russia continues to take information warfare to a new level, working to fan anti-US and anti-Western 

sentiment both within Russia and globally. Moscow will continue to publish false and misleading 

information in an effort to discredit the West, confuse or distort events that threaten Russia's image, 

undercut consensus on Russia, and defend Russia's role as a responsible and indispensable global 

power. 

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Ukraine, Belarus, and Moldova 

The implementation timeline for the Minsk agreements has been extended through 2016, although 

opposition from Ukraine, Russia, and the separatists on key remaining Minsk obligations might make 

progress slow and difficult in 2016. Sustained violence along the Line of Contact delineating the 

separatist-held areas will probably continue to complicate a political settlement, and the potential for 

escalation remains. 

Ukraine has made progress in its reform efforts and its moves to bolster ties to Western institutions. 

Ukraine will continue to face serious challenges, however, including sustaining progress on key reforms 

and passing constitutional amendments-required under the Minsk agreements to devolve political power 

and fiscal authority to the regions. 

Belarus continues its geopolitical balancing act, attempting to curry favor with the West without 

antagonizing Russia. President Lukashenko released several high-profile political prisoners in August 

2015 and secured reelection to a fifth term in October 2015 without cracking down on the opposition as 

he has in previous elections. These developments prompted the EU and the United States to implement 

temporary sanctions relief, providing a boost to a Belarusian economy. 

Moldova faces a turbulent year in 2016. Popular discontent over government corruption and misrule 

continues to reverberate after a banking scandal sparked large public protests, and political infighting 

brought down a government coalition of pro-European parties in October 2015. Continued unrest is 

likely. The breakaway pro-Russian region is also struggling economically and will remain dependent on 

Russian support. 

The Caucasus and Central Asia 

Even as Georgia progresses with reforms, Georgian politics will almost certainly be volatile as political 

competition increases. Economic challenges are also likely to become a key political vulnerability for the 

government before the 2016 elections. Rising frustration among Georgia's elites and the public with the 

slow pace of Western integration and increasingly effective Russian propaganda raise the prospect that 

Tbilisi might slow or suspend efforts toward greater Euro-Atlantic integration. Tensions with Russia will 

remain high, and we assess that Moscow will raise the pressure on Tbilisi to abandon closer EU and 

NATO ties. 

Tensions between Armenia and Azerbaijan over the separatist region of Nagorno-Karabakh remained 

high in 2015. Baku's sustained military buildup coupled with declining economic conditions in Azerbaijan 

are raising the potential that the conflict will escalate in 2016. Azerbaijan's aversion to publicly 

relinquishing its claim to Nagomo-Karabakh proper and Armenia's reluctance to give up territory it 

controls will continue to complicate a peaceful resolution. 

Central Asian states remain concerned about the rising threat of extremism to the stability of their 

countries, particularly in light of a reduced Coalition presence in Afghanistan. Russia shares these 

concerns and is likely to use the threat of instability in Afghanistan to increase its involvement in Central 

Asian security affairs. However, economic challenges stemming from official mismanagement, low 

commodity prices, declining trade and remittances associated with Russia's weakening economy, and 

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ethnic tensions and political repression, are likely to present the most significant instability threat to these 

countries. 

EUROPE 

Key Partners 

European governments will face continued political, economic, and security challenges deriving from 

mass migration to Europe, terrorist threats, a more assertive Russia, and slow economic 

recovery. Differences among national leaders over how best to confront the challenges are eroding 

support for deeper EU integration and will bolster backing for populist leaders who favor national 

prerogatives over EU-wide remedial strategies. 

The European Commission expects 1.5 million migrants to arrive in Europe in 2016-an influx that is 

prompting European officials to focus on improving border security, particularly at the Schengen Zone's 

external borders, and putting the free movement of people within the EU at risk. Several European 

governments are using military forces in domestic security roles. 

The European Commission has warned against drawing a link between terrorists and refugees, but 

populist and far-right leaders throughout Europe are preying on voters' security fears by highlighting the 

potential dangers of accepting migrants fleeing war and poverty. Some EU leaders are citing the 

November 2015 terrorist attacks in Paris to justify erecting fences to stem the flow of people. 

European countries will remain active and steadfast allies on the range of national security threats that 

face both the United States and Europe-from energy and climate change to countering violent 

extremism and promoting democracy. Although the majority of NATO allies have successfully haHed 

further declines in defense spending, European military modernization efforts will take several years 

before marked improvement begins to show. 

Europe also continues to insist on full implementation of the Minsk agreement to stop violence in Ukraine. 

However, European governments differ on the proper extent of engagement with Moscow. 

Europe's economic growth, which the EU projects will be moderate, could falter if emerging market 

economies slow further, which would decrease the demand for European exports. The EU continues to 

struggle to shake off the extended effects of its economic recession, with lingering worries over high 

unemployment, weak demand, and lagging productivity. Greece also remains a concern for the EU. The 

agreement between Greece and its creditors is an important step forward for restoring trust among the 

parties and creating the conditions for a path forward for Greece within the Eurozone. Developing the 

details of the agreement and its full implementation remain challenges. 

The Balkans 

Ethnic nationalism and weak institutions in the Balkans remain enduring threats to stability. Twenty years 

after the end of the Bosnian War and the signing of the Dayton Agreement, Bosnia and Herzegovina 

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remains culturally and administratively divided, weighed down by a barely functional and inefficient 

bureaucracy. The country, one of Europe's poorest, has endured negative GDP growth since the 2008 

international financial crisis and is reliant on the support of international institutions including the IMF. 

Youth unemployment, estimated at 60 percent, is the world's highest. 

Kosovo has made progress toward full, multiethnic democracy, although tensions between Kosovo 

Albanians and Kosovo Serbs remain. In Macedonia, an ongoing political crisis and concerns about 

radicalization among ethnic Albanian Muslims threatens to aggravate already-tense relations between 

ethnic majority Macedonians and the country's minority Albanians, fifteen years after a violent interethnic 

conflict between the two groups ended. Social tensions in the region might also be exacerbated if the 

Western Balkans becomes an unwilling host to significant migrant populations. 

Turkey 

Turkey remains a partner in countering ISIL and minimizing foreign fighter flows. Ankara will continue to 

see the Kurdistan Workers' Party (PKK} as its number one security threat and will maintain military and 

political pressure on the PKK, as well as on the Democratic Union Party (PYD) and its armed affiliate 

People's Protection Units (YPG}, which Turkey equates with the PKK. Turkey is extremely concerned 

about the increasing influence of the PYD and the YPG along its borders, seeing them as a threat to its 

territorial security and its efforts to control Kurdish separatism within Hs borders. 

Turkey is concerned about Russia's involvement in the region in support of Asad, the removal of whom 

Turkey sees as essential to any peace settlement. Turkey is also wary of increased Russian cooperation 

with the Kurds and greater Russian influence in the region that could counter Turkey's leadership role. 

The Russian-Iranian partnership and Iran's attempts to expand Shiite influence in the region are also 

security concerns for Turkey. 

The refugee flow puts significant strain on Turkey's economy, which has amounted to $9 billion according 

to a statement by Turkish President Recap Tayyip Erdogan. Refugees have also created infrastructure 

and social strains, particularly regarding access to education and employment. Turkey tightened its 

borders in 2015 and is working to stanch the flow of migrants to Europe and address refugee needs. 

MIDDLE EAST AND NORTH AFRICA 

Iraq 

In Iraq, anti-ISIL forces will probably make incremental battlefield gains through spring 2016. Shia militias 

and Kurdish forces in northern Iraq have recaptured Bayji and Sinjar, respectively, from the Islamic State 

of Iraq and the Levant (ISIL). In western Iraq, the Iraqi Security Forces (IS F) have retaken most of the 

greater Ramadi area from ISIL and will probably clear ISIL fighters from the city's urban core in the 

coming month. 

ISIL's governance of areas it controls is probably faltering as airstrikes take a toll on the group's sources 

of incorne, hurting ISIL's ability to provide services, and causing economic opportunities for the population 

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to dwindle. Even so, the Iraqi Sunni population remains fearful of the Shia-dominated government in 

Baghdad. This fear has been heightened as Iranian-backed Shia militias play a lead role in retaking 

Sunni-majority areas, suggesting Iraq's Sunnis will remain willing to endure some deprivation under ISIL 

rule. 

Prime Minister Haydar ai-Abadi will probably continue to struggle to advance his reforms-which aim to 

combat corruption and streamline government-because of resistance from Iraqi elites who view the 

reforms as threatening to their entrenched political interests. Meanwhile, the drop in oil prices is placing 

strain on both Baghdad's and lrbil's budgets, constraining their ability to finance counter-ISIL operations 

and limiting options to address potential economically driven unrest. 

Syria 

We assess that foreign support will allow Damascus to make gains in some key areas against the 

opposition and avoid further losses, but it will be unable to fundamentally alter the battlespace. Increased 

Russian involvement, particularly airstrikes, will probably help the regime regain key terrain in high priority 

areas in western Syria, such as Aleppo and near the coast, where it suffered losses to the opposition in 

summer 2015. ISIL is under threat on several fronts in Syria and Iraq from increased Coalition and 

government operations. 

Manpower shortages will continue to undermine the Syrian regime's ability to accomplish strategic 

battlefield objectives. The regime still lacks the personnel needed to capture and hold key areas and 

strategically defeat the opposition or ISIL. Damascus increasingly relies on militias, reservists, and 

foreign supporters-such as Iran and Lebanese Hizballah--to generate manpower, according to press 

reporting. 

The Syrian regime and most of the opposition are participating in UN-mediated talks that started in early 

February in Geneva. Both sides probably have low expectations for the negotiations, with the opposition 

calling for ceasefires and humanitarian assistance as a precondition. The negotiations, without a 

ceasefire agreement, will not aHer the battlefield situation. 

The humanitarian situation in Syria continues to deteriorate. In December 2015 and January 2016, the 

number of Syrian refugees registered or in the process of registering in the Middle East and North Africa 

rose by nearly 102,000 from 4.3 million to 4.4 million, according to UN data. The refugees are putting 

significant strain on countries surrounding Syria as well as on Europe. Turkey hosts more than 2.2 million 

refugees; Lebanon has about 1.1 million; Jordan has more than 630,000; Iraq has 245,000. 

Approximately 500,000 have fled to Europe, according to the UN. The more than 4 million refugees and 

6.5 million estimated internally displaced persons (IDPs) account for 49 percent of Syria's preconflict 

population. 

Estimates of fatalities in Syria since the start of the civil war vary, but most observers calculate that at 

least 250,000 men, women, and children on all sides of the conflict have lost their lives since 2011. 

On 22 December, the UN Security Council unanimously adopted resolution 2258, which renews the 

UN's authority to utilize cross-border deliveries for humanitarian assistance to Syria through 10 

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January 2017. Since July 2014, the UN has provided food to 2.4 million people, water and sanitation 

to 1.3 million people, and medical supplies to 4.1 million people through its cross-border deliveries. 

Separately, the Syrian Government began requiring in mid-November that aid agencies get 

humanitarian assistance notarized by the Syrian embassies in the country of product origin. This 

requirement previously applied only to commercial goods and might delay future UN food deliveries 

within Syria, according to the UN. 

Libya 

We assess that insecurity and conflict in Libya will persist in 2016, posing a continuing threat to regional 

stability. The country has been locked in civil war between two rival governments and affiliated armed 

groups. The 17 December signing of a UN-brokered agreement to form a Government of National Accord 

(GNA) resuHed from a year-long political dialogue that sought to end the ongoing civil war and reconcile 

Libya's rival governments. However, the GNA will face a number of obstacles in establishing its authority 

and security across the country. The GNA still faces the difficult task of forming a capable, centralized 

security force. It will also be challenged to confront terrorist groups such as ISIL, which has exploited the 

conflict and political instability in the country to expand its presence. 

The rival governments-the internationally recognized Tobruk-based House of Representatives 

(House) and the Tripoli-based General National Congress (GNC) have participated in UN-brokered 

peace talks since fall 2014. Reaction to the deal and the proposed GNA has been mixed, and 

hardliners on both sides have opposed the agreement. 

(U) On 25 January, the House voted to approve the UN-brokered deal with conditions but rejected a 

controversial article granting the GNA's Presidency Council interim control of the military. The House 

also rejected the GNA's proposed cabinet and demanded a smaller ministerial slate. 

Libya's economy has deteriorated because of the conflict. Oil exports-the primary source of 

government revenue-have fallen significantly from the pre-revolution level of 1.6 billion barrels per 

day. Libya's oil sector also faces continued threats from terrorist groups; ISIL attacked oil production 

and export facilities in February 2015, September 2015, and January 2016. 

Meanwhile, extremists and terrorists have exploited the security vacuum to plan and launch attacks in 

Libya and throughout the region. The permissive security environment has enabled ISIL to establish one 

of its most developed branches outside of Syria and Iraq. As of late 2015, ISIL's branch in Libya 

maintained a presence in Sur!, Benghazi, Tripoli, Ajdabiya, and other areas of the country, according to 

press reports. Members of ISIL in Libya continue to stage attacks throughout the country. 

Yemen 

The Yemen conflict will probably remain in a strategic stalemate through mid-2016. Negotiations between 

the Saudi-led coalition and the Huthi-aligned forces remain stalled, but neither side is able to achieve 

decisive results through military force. Huthi-aligned forces almost certainly remain committed to fighting 

following battlefield setbacks in the Aden and Marib Governorates in 2015 and probably intend to retake 

lost territory in those areas. 

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Nonetheless, regional stakeholders on both sides of Yemen's conflict, including Iran, which continues to 

back the Huthis, are signaling willingness to participate in peace talks. Even a cease-fire of a few days or 

weeks would facilitate the entry and distribution of commercial and humanitarian goods inside Yemen, 

where at least 21 million people-80 percent of the population-require assistance, according to the UN. 

AQAP and ISIL's affiliates in Yemen have exploited the conflict and the collapse of government authority 

to gain new recruits and allies and expand their territorial control. In December, AQAP seized the 

southern city of Zinjibar, adding to its capture of the coastal city of Mukalla to the east. 

Iran 

Since January, Tehran met the demands for implementation of the Joint Comprehensive Plan of Action 

(JCPOA), exchanged detainees, and released 10 US sailors. Despite these developments, the Islamic 

Republic of Iran presents an enduring threat to US national interests because of its support to regional 

terrorist and militant groups and the Asad regime, as well as its development of advanced military 

capabilities. Tehran views itself as leading the "axis of resistance" -which includes the Asad regime and 

subnational groups aligned with Iran, especially Lebanese Hizballah and Iraqi Shia militants. Their intent 

is to thwart US, Saudi, and Israeli influence, bolster its allies, and fight ISIL's expansion. Tehran might 

even use American citizens detained when entering Iranian territories as bargaining pieces to achieve 

financial or political concessions in line with their strategic intentions. 

Iran's involvement in the Syrian, Iraqi, and Yemeni conflicts deepened in 2015. In Syria, Iran more openly 

acknowledged the deaths of Iranian "martyrs," increased Iranian troop levels, and took more of a frontline 

role against "terrorists." In Iraq, Iranian combat forces employed rockets, artillery, and drones against 

ISIL. Iran also supported Huthi rebels in Yemen by attempting to ship lethal aid to the Huthis. Tehran will 

almost certainly remain active throughout the Persian Gulf and broader Middle East in 2016 to support its 

regional partners and extend its regional influence. Iranian officials believe that engaging adversaries 

away from its borders will help prevent instability from spilling into Iran and reduce ISIL's threat to Iran 

and its regional partners. Iran has also increased cooperation with Russia in the region. 

Supreme Leader Khamenei continues to view the United States as a major threat to Iran, and we assess 

that his views will not change, despite implementation of the JCPOA deal. In October 2015, Khamenei 

publicly claimed the United States was using the JCPOA to "infiltrate and penetrate" Iran. His statement 

prompted the Iranian hardliner-dominated security services to crack down on journalists and 

businessmen with suspected ties to the West. The crackdown was intended by hardliners to demonstrate 

to President Ruhani and to Washington that a broader opening to the West following JCPOA would not 

be tolerated. Iran released several US citizens in January 2016 who were being held in Iran: however, it 

might attempt to use any additional US citizens as bargaining chips for US concessions. 

Iran's military and security services are keen to demonstrate that their regional power ambitions have not 

been altered by the JCPOA deal. One week prior to JCPOA Adoption Day, Iran publicized the launch of 

its new "long-range" and more accurate ballistic missile called the "Emad." Iran also publicizes 

development of its domestically produced weapons systems, submarines and surface combatants, 

artillery, and UAVs to deter potential adversaries and strengthen its regional influence and prestige. 

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Iran's involvement in the Syrian and Iraqi conflicts has enabled its forces to gain valuable on-the-ground 

experience in counterinsurgency operations. 

Lebanon 

Lebanon will continue to struggle with the fallout from the civil war in neighboring Syria and faces a range 

of interlocking political, security, humanitarian, and economic challenges. The spillover from the Syrian 

conflict has had negative consequences on almost all aspects of life in Lebanon, from rising sectarianism 

to major strains on infrastructure and public services, further straining the country's delicate political 

balance. 

Lebanon's most immediate security threat is from Syrian-based extremists on its northeastern border. 

The Lebanese army has carried out multiple operations against Nusrah Front and ISIL to secure the 

border and prevent against the flow of terrorists into the country. Beirut also faces threats from Sunni 

extremists in the country who are retaliating against Lebanese Hizballah's military involvement in the 

Syrian civil war. 

The influx of about 1.1 million Sunni Syrian refugees to Lebanon has altered the country's sectarian 

demographics and is badly straining public services and burdening the economy. The Lebanese 

economy will probably remain stagnant throughout 2016, as protracted regional instability and 

political gridlock at home continue to erode the country's competitiveness. 

Egypt 

Egypt faces a persistent threat of terrorist and militant activity directed primarily at state security forces in 

both the Sinai Peninsula and in mainland Egypt. The security services have initiated a counterterrorism 

campaign to disrupt and detain Sinai-based militants; however, terrorist groups still retain the ability to 

conduct attacks. 

ISIL's branch in Sinai (ISIL-Sinai) has conducted dozens of lethal attacks on military and security 

personnel, some of which suggest sophisticated and coordinated attack planning, according to press 

reports. 

ISIL-Sinai claimed responsibility for the downing of a Russian aircraft in the Sinai in October 2015, 

which, if true, would demonstrate the expanding threat from ISIL and its regional branches. 

The continued threat of terrorism places further strain on Egypt's economy by harming Egypt's 

tourism industry, a key source of revenue. The country is also grappling with high poverty and 

unemployment rates. 

Tunisia 

Tunisia's first post-transitional democratic government since the 2011 Arab Spring revolution is marking 

its first year in office. Since the revolution, the country has overcome deep political divisions to reach 

consensus on key political issues, develop a new constitution, and elect a new government, according to 

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press and academic reports. Despite the government's significant strides in its democratic transition, 

Tunisia faces challenges in consolidating these achievements. 

Tunisia is confronting a threat from terrorist groups exploiting Libya's permissive environment to plan 

and launch attacks, as well as from groups operating within Tunisia's borders, according to press 

reports. The perpetrators of the terrorist attack on the Bardo Museum in Tunis in March 2015 and 

hotels in Sousse in June-both claimed by ISIL-trained at a terrorist camp in Libya, according to 

press reports. 

The government inherited high unemployment, particularly among youth, and a high budget deficit 

according to press reports. The Bardo and Sousse terrorist attacks have disrupted tourism, a critical 

source of revenues and jobs. 

SOUTH ASIA 

Afghanistan 

The Kabul Government will continue to face persistent hurdles to political stability in 2016, including 

eroding political cohesion, assertions of authority by local powerbrokers, recurring financial shortfalls, and 

countrywide, sustained attacks by the Taliban. Political cohesion will remain a challenge for Kabul as the 

National Unity Government will confront larger and more divisive issues later in 2016, including the 

implementation of election reforms, long-delayed parliamentary elections, and a potential change by a 

Loya Jirga that might fundamentally alter Afghanistan's constitutional order. Kabul will be unable to 

effectively address its dire economic situation or begin to curb its dependence on foreign aid until it first 

contains the insurgency, which is steadily chipping away at Afghanistan's security. In this environment, 

international financial aid will remain the most important external determinant of the Kabul government's 

strength. We assess that fighting in 2016 will be more intense than 2015, continuing a decade-long trend 

of deteriorating security that will compound these challenges. The fighting will continue to threaten US 

personnel, our Allies, and international partners-including Afghans-particularly in Kabul and other 

urban population centers. The Afghan National Security Forces (ANSF), with the help of anti-Taliban 

powerbrokers and international funding, will probably maintain control of most major population centers. 

However, the forces will very likely cede control of some rural areas. Without international funding, the 

ANSF will probably not remain a cohesive or viable force. 

The Taliban has largely coalesced and is relatively cohesive under the leadership of new Taliban Senior 

Leader Mullah Akhtar Mohammad Mansur despite some early opposition. The Taliban's two-week 

seizure of the provincial capital of Kunduz provided an important boost to Mansur's leadership. The 

Taliban will continue to test the overstretched ANSF faced with problematic logistics, low morale, and 

weak leadership. 

The Islamic State of Iraq and the Levant (ISIL) announced in January 2015the formation of its Khorasan 

branch in South Asia, an amalgamation of primarily disaffected and rebranded former Afghan Taliban and 

Tehrik-e Taliban Pakistan (TTP) members. Despite quick early growth in 2015, ISIL's Khorasan branch 

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will probably remain a low-level threat to Afghan stability as well as to US and Western interests in the 

region in 2016. 

Bangladesh 

Prime Minister Sheikh Hasina's continuing efforts to undermine the political opposition in Bangladesh will 

probably provide openings for transnational terrorist groups to expand their presence in the country. 

Hasina and other government officials have insisted publically that the killings of foreigners are the work 

of the Bangladesh Nationalist Party and the Bangladesh Jamaat-e lslami political parties and are 

intended to discredit the government. However, ISIL claimed responsibility for 11 high-profile attacks on 

foreigners and religious minorities. Other extremists in Bangladesh-including Ansarullah Bangia Team 

and ai-Qa'ida in the Indian Subcontinent (AQIS)-have claimed responsibility for killing at least 11 

progressive writers and bloggers in Bangladesh since 2013. 

Pakistan and India 

Relations between Pakistan and India remain tense despite the resumption of a bilateral dialogue in 

December. Following a terrorist attack in early January on Pathankot Air Force base in India, which New 

Delhi blames on a Pakistani-based group, India's engagement with Pakistan will probably hinge in 2016 

on Islamabad's willingness to take action against those in Pakistan linked to the attack. 

SUB-SAHARAN AFRICA 

Central Africa 

Prospects for delayed elections in the Democratic Republic of the Congo, originally scheduled for 

2016, increase the risk of political tensions and perhaps violence. Violence might also break out in the 

Republic of Congo where a controversial October 2015 constitutional referendum paved the way for 

long-serving President Denis Sassou-Nguesso to run for a new term in 2016 elections. Both 

governments have resorted to heavy-handed tactics to stifle opposition and subdue or prevent electionrelated protests. 

In Burundi, violence related to President Pierre Nkurunziza's controversial reelection in July 2015 will 

almost certainly continue as a simmering crisis. The conflict might expand and intensify if increased 

attacks between the government and armed opposition provoke a magnified response from either side or 

if the security services fracture into divided loyalties. 

The Central African Republic held peaceful presidential and parliamentary elections in late December, 

although they were marred by logistical issues. A run-off will probably take place in mid-February 

between the two top candidates, and we do not know how the armed spoilers and losing candidates will 

react. The risk of continued ethno-religious clashes between Christians and Muslims throughout the 

country remains high despite the presence of international peacekeeping forces, which are increasingly 

targets of violence. 

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Somalia 

The Somali Federal Government's authority will probably remain largely confined to the capital in 2016, 

and Mogadishu will continue to rely on the African Union Mission in Somalia (AMISOM) as a security 

guarantor against ai-Shabaab as it prepares for elections in 2016. 

South Sudan 

Implementation of the peace agreement between Juba and opposition elements will be slow as spoilers 

from both sides seek to stall progress. The return of former opposition members to Juba will almost 

certainly cause jockeying for positions of power. localized fighting will continue and probably spread to 

previously unaffected areas, causing the humanitarian situation to worsen Economic conditions will 

probably deteriorate further as inflation remains high and prices for staple goods rise, fueling 

dissatisfaction with the government. 

Sudan 

President Bashir consolidated power following his reelection in April2015, but the regime will continue 

attempts at a national dialogue, which will probably not placate a divided political opposition. The regime 

will almost certainly confront a range of challenges, including public dissatisfaction over a weakened 

economy. Divisions among armed opponents will almost certainly inhibit their ability to make significant 

gains against Khartoum. However, elements of the opposition will continue to wage insurgencies in the 

Southern Kordofan and Blue Nile states and Darfur. Sudan, listed as a state sponsor of terror since 

1993, cut diplomatic ties with Iran in January following an attack on the Saudi Embassy in Tehran. Since 

2014, Sudan's relations with Iran have cooled as Khartoum has grown closer to Riyadh. 

Nigeria 

President Muhammadu Buhari and the Nigerian government will confront a wide range of challenges in 

2016, many of which are deeply rooted and have no "quick fixes." His tasks include reviving a struggling 

economy- Africa's largest- diversifying sources of government revenue beyond oil, reining in corruption, 

addressing mounting state debts, reforming redundant parastatal organizations, and developing the 

power, agriculture, and transportation sectors. Nigeria will continue to face internal threats from Boko 

Haram, which pledged loyalty to the Islamic State in Iraq and the Levant (ISIL) in March 2015. Despite 

losing territory in 2015, Boko Haram will probably remain a threat to Nigeria throughout 2016 and will 

continue its terror campaign within the country and in neighboring Cameroon, Niger, and Chad. 

LATIN AMERICA AND CARIBBEAN 

Central America 

Strong family ties to the United States-as well as gang violence, a lack of jobs, and a worsening drought 

in Central America's northern tier-will sustain high rates of migration to the United States in 2016. Weak 

institutions, divided legislatures, low levels of tax collection, and high debts will constrain efforts to 

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improve rule of law, tackle corruption, and alleviate poverty. Homicide rates in the region remain among 

the highest in the world and spiked in El Salvador to levels not seen since the country's civil war from 

1979 to 1992. The people hardest hit by the drought include most of the region's subsistence farmers, 

who constitute 25 to 40 percent of the population in Guatemala and Honduras. The prolonged drought 

will probably affect 3.5 million people in the region in_2016. 

Cuba 

Cuban leaders will remain focused on preserving political control as they prepare for a probable 

presidential transition in 2018. Economic reforms to reduce the state role in the economy and promote 

private economic activity will continue at a slow pace, in part because of probable resistance from senior 

leaders and government officials concerned that rapid changes might provoke popular unrest. Living 

standards will remain poor. Along with fears among the Cuban population that the United States will 

repeal the 1966 Cuban Adjustment Act, the statute allowing Cuban nationals to apply to become lawful 

permanent US residents, these trends sustain the increasing migration of undocumented Cubans. 

Migration is particularly acute across the US southwest border where 31,000 Cubans crossed in FY2015, 

a 76-percent increase over the prior year. 

Venezuela 

The opposition alliance won a much-coveted majority in the December 2015 national assembly elections, 

setting the stage for a political showdown in 2016 between the legislative and executive branches. The 

opposition will seek to implement its policy agenda, which might include pursuing a presidential recall 

referendum. Economic issues will also figure prominently on the domestic agenda for 2016. Caracas will 

probably encounter fiscal pressures as it seeks to avoid a default on its sovereign debt in 2016; the 

economy is suffering from a severe recession that the IMF projects will cause it to contract by at least 8 

percent in 2016. Venezuela's government has declined to release complete official figures on 

macroeconomic indicators, such as inflation and growth. 

Brazil 

Brazil's investigation into corruption at state-controlled oil company Petrobras will probably continue 

through 2016. Scores of Petrobras officials, construction firm executives, and politicians have been jailed 

since the probe was launched in March 2014. Brazil lost its investment-grade rating in December 2015 

after the second credit agency in three months downgraded the country's debt to junk status. Further 

damaging revelations from the probe might prolong political gridlock in Brazil. Meanwhile, preparations 

are underway in Brazil to address infrastructure, logistics, and security issues involved in hosting the 

2016 Summer Olympics in Rio. Organizers are using past Olympics as models, cooperating with foreign 

governments, and building upon Brazil's experience organizing a large and sustained security posture 

such as when it hosted the World Cup in 2014. 

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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

Questions for Ms. Kathleen McGettigan 

Acting Director 

U.S. Office of Personnel Management 

Questions from Representative Stacey E. Plaskett 

Committee on Oversight and Government Reform 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

1. At the hearing, I asked "which or any of the senior White House staffers who have 

access to [classified] materials are under criminal investigation by the FBI?" In 

response to that question, you stated, "We will get back to you." As a follow-up to 

my question, please answer the following: 

a. Are there currently any senior officials working in the Trump Administration who 

are being afforded access to sensitive or classified information and are under 

investigation by the FBI? If so, how many individuals, and who are they? 

Response: Requests for background investigations for presidential appointees under the 

purview of the Executive Office of the President (EOP) are generally submitted to the 

Federal Bureau of Investigation (FBI), which is EOP's cognizant investigative service 

provider (ISP), not to OPM. Thus, OPM is not aware whether senior officials working in the 

Administration who have been afforded access to sensitive or classified information are 

under investigation by the FBI. 

b. Have any former senior officials within the Trump Administration been provided 

access to sensitive or classified information while under investigation by the FBI? 

If so, how many individuals, and who are they? 

Response: Requests for background investigations for presidential appointees under the 

purview of the Executive Office of the President (EOP) are generally submitted to the FBI, 

which is EOP's cognizant investigative service provider (ISP), not to OPM. Thus, OPM is 

not aware whether former senior officials within the Administration who had been afforded 

access to sensitive or classified information were under investigation by the FBI. 

c. Do any current White House staffhave previous criminal convictions? If so, how 

many staffers? Please provide the names of the staffers, their titles, and what the 

previous criminal conviction was for. 

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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

Response: Requests for background investigations for White House employees under the 

purview of the Executive Office of the President (EOP) are generally submitted to the FBI, 

which is EOP's cognizant investigative service provider (ISP), not to OPM. 

d. Are any White House staff under active investigation by the FBI or other law 

enforcement authorities? If so, how many staffers? Please provide the names of 

the staffers and their titles. 

Response: Requests for background investigations for White House employees under the 

purview of the Executive Office of the President (EOP) are generally submitted to the FBI, 

which is EOP's cognizant investigative service provider (ISP), not to OPM. 

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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

Questions for Mr. David DeVries 

Chief Information Officer 

U.S. Office of Personnel Management 

Questions from Chairman Jason Chaffetz 

Committee on Oversight and Government Reform 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

I. What kind of notifications is the IT security team required to make before deploying 

security tools onto the network? 

a. If so, what is the purpose of these notifications? 

Response: Based on the wording of these questions, as a whole, we are interpreting the 

phrase "notifications" in this question to mean notifications to employees and employee 

representatives (unions). 

We consider the legal question of whether an agency is required to notify and bargain with 

union representatives prior to making changes in the area of information security to be 

unsettled. So far, this has not affected OPM's timely deployment of security tools. 

2. Have you seen the deployment of such tools delayed because of the need to notify 

union representatives? 

Response: Not at this point in time. 

3. What kind of barriers or challenges have you seen in trying to timely deploy security 

tools? 

Response: As yet, none. 

4. Are there any other administrative or regulatory or bureaucratic barriers at OPM that 

prevent or delay your work the timely deployment of such tools? 

Response: A 2014 administrative decision (US. DHS, US. ICE, 67 FLRA 501) of the quasijudicial, three-member, presidentially appointed and Senate-confirmed Federal Labor 

Relations Authority may have created potential obstacles to delay timely deployment at 

agencies. So far, this has not affected OPM's timely deployment of security tools. 

Additionally, the need for resources may, at times, cause an increase in the time for 

deployment of security tools, however these have not been significant delays and often the 

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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

reallocation and prioritization of resources within the Office of the Chief Information Officer 

can resolve the issue. 

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UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

Questions for Mr. David DeVries 

Chief Information Officer 

U.S. Office of Personnel Management 

Questions from Chairman Will Hurd 

Subcommittee on Information Technology 

Committee on Oversight and Government Reform 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

Series I 

1. What is OPM's plan to boost capacity in order to decrease the growing backlog of 

background investigations (and subsequently decrease average investigation time) 

and how quickly will this plan be implemented? 

Response: Capacity to conduct investigations is not restricted by IT. As for the National 

Background Investigation Bureau's (NBIB) efforts to boost its capacity to decrease the 

backlog of investigations, it is my understanding that Director Phalen has provided answers 

in response to Chairman Chaffetz in his Questions for the Record outlining in detail NBIB's 

efforts to grow their capacity. I defer to Director Phalen to speak for NBIB in this respect. 

2. What are the top impediments to achieving this plan and being successful? 

Response: I agree with Director Phalen's response to Question 11 from Chairman Will Hurd 

in the Questions for the Record Director Phalen has submitted in connection with this 

hearing. 

3. What could be done to considerably accelerate the implementation of this plan? 

Response: Each aspect noted in Director Phalen's responses is a continuous and ongoing 

effort for NBIB to meet agencies' needs. NBIB has met with its contractors to receive their 

plans on increasing their staff to apply to this work and will continue to encourage new 

capacity growth. Additionally, NBIB has implemented initiatives to reduce the time needed 

to onboard these vital resources and will continue to look for additional efficiencies. 

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Series II 

l. Who do you report to at the agency? 

a. Who does your performance review? 

Response: The OPM Director. 

b. How often do you meet with the head of the agency? 

Response: I report directly to the OPM Director (currently Acting Director) with whom I 

meet individually at least once a week. I also meet with her in a larger forum at least three 

times per week during meetings with Office of the Director leadership and the direct report 

Agency leaders. 

2. Do you currently have authority in practice to review and manage the IT portfolio for 

the entire agency? Why/not? 

Response: As the co-chair of the Investment Review Board (IRB), which is one of OPM's 

governance boards, I review and provide recommendations for the approval of IT 

investments. The IRB was re-constituted in August 2016 and is now actively reviewing IT 

investments above $250,000. As a voting member of the OPM Capital Investment 

Committee board, I review and approve acquisition requests in excess of $250,000, and I 

specifically flag those involving procurements for IT services or capabilities. Since my 

arrival at OPM in September 2016, my visibility has grown over the OPM IT portfolio. This 

has been fostered by the implementation of an IT Acquisition Review Checklist. This review 

encompasses IT spending by the agency in amounts over $250,000. Additionally, the CIO 

office has initiated IT portfolio reviews of all recorded IT investments, both major and nonmajor. 

a. What are the challenges? 

Response: There are a variety of challenges that may impact my ability to review and 

manage the OPM IT portfolio. Already, I have incorporated best practices to review the large 

value procurements- which have added a level of formality and a degree of rigor that is 

more effective. Currently, OPM Leadership is working through organizational structures, the 

variety of funding mechanisms, and the nature of procurement reviews to better align 

contract vehicles and improve agile development and delivery of effective and secure 

capability. 

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3. Have you completed an annual IT investment portfolio review? 

a. Could you provide examples of where you identified opportunities to reduce 

waste and duplication- or create efficiencies as a result of this review? 

Response: Since arriving at OPM in September 2016, I have begun to execute IT portfolio 

reviews. To date, we have executed comprehensive reviews for the NBIB IT Programs, and 

initial reviews of financial management systems and retirement services systems. The 

reviews for the NBIB systems resulted in agreed upon priorities and work required for FY 

2017, and additional efforts that will be executed by the Department of Defense on the 

National Background Investigation Services (NBIS) effort in concert with OPM maintaining 

and operating the legacy capability for the foreseeable future. 

OPM will complete a full review of its IT portfolio in 2017, which we anticipate will better 

position us to identifY opportunities to reduce waste/duplication and create efficiencies. I 

reviewed all major IT investments for FY17 and FY18 and posted these to the IT Dash Board 

in May 2017 as part of the annual budget submission to OMB. 

4. Do you approve the IT budget request of your agency? 

a. How does this review process work? 

b. Describe how the CIO and the CFO manage IT budget coordination. 

Response: The Chief Financial Officer (CFO) and I work in close coordination on the initial 

IT budget requirements planning and IT budget formulation, and we also approve the Agency 

IT Budget request. The process is as follows: the CFO and I review the IT Portfolio 

Summary, which includes, what was previously known as the Office of Management and 

Budget (OMB) Exhibit 53 and the IT Business Cases, before submission to OMB around 

September of each year. Then, the CFO and I again review the IT budget in conjunction with 

OMB. 

5. Are you certifYing that IT investments are delivering functionality on an incremental 

basis (within six months)? Please provide an example. 

Response: I oversee the certification of incremental development through an integrated IT 

Program Manager and business function team. OPM uses the stage gate review process to 

evaluate the Major IT Business Cases for compliance with this requirement. As an example, 

during FY 2016 a major undertaking was the USAJOBS investment and incremental 

development. This project delivered incremental functionality every two to six months, 

resulting in a significantly more user-friendly capability and wider customer acceptance. This 

is a nascent capability and is being applied as contracts are initiated or renewed. 

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6. Do you review and approve IT contracts on a Department-wide basis? 

a. Have you recently terminated any IT contracts due to cost growth, schedule 

delays or other factors? 

Response: The Office of Procurement Operations (OPO) executes contract pre-award, 

award, and post award activities; it is the office with procurement authority within OPM. As 

CIO, I utilize a process to review and approve IT Acquisition Checklist requests for contract 

actions over $250,000 prior to acquisition, with the goal to increase visibility into IT related 

contract actions. OPO requires an approved IT Checklist signed by the CIO before it will 

execute contract activities. 

Since arriving at OPM in September 2016, I have not recommended that OPO terminate any 

IT contracts. I have consolidated duplicative contract requirements. 

7. Are you familiar with the term TechStat? Have you conducted any TechStat reviews 

since you've been at the agency? 

Response: I am familiar with the term TechStat; I have conducted several Quarterly Program 

Reviews (QPRs) on programs at OPM, which are analogous to TechStat reviews. 

8. What is your role in the hiring and performance reviews for other agency IT 

employees? 

a. Do you approve the appointment of other agency IT employees? 

Response: I conduct the performance reviews for my direct reports, and I approve the hiring 

selections of CIO employees. 

9. What plan or strategy does your agency have in place to recruit and retain IT talent? 

Response: OPM's Office of the Chieflnformation Officer (OCIO) actively participates in IT 

forums and speaking engagements across the Federal workspace and participates in various 

government-wide programs that kicked off in FY 2016 to recruit and retain IT talent. To 

further our retention efforts, OCIO held cyber workforce orientation training for the program. 

Additionally, the OCIO provided training opportunities in Agile and Information Technology 

Infrastructure Library Certifications to attract and retain IT and Cyber professionals. Our 

goal is to enhance training and certifications for our technical workforce. This includes 

providing a minimum number of hours of training for each employee each year. 

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I 0. Does your agency have a human capital plan for address supporting timely and 

effective IT acquisition? 

Response: OPM prepares an acquisition human capital plan which includes an IT 

Supplement. This plan is submitted annually to OMB, in accordance with OMB 

requirements. 

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Questions for Mr. Charles S. Phalen, Jr. 

Director 

National Background Investigations Bureau 

U.S. Office of Personnel Management 

Questions from Chairman Jason Chaffetz 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

I. As of february 1, 2017, what is NBIB's current backlog oflnitial and Periodic 

Reinvestigation background investigations and adjudications? 

Response: As the primary Investigative Service Provider for the government, the National 

Background Investigations Bureau (NBIB) provides investigations to Federal agencies, 

which, in tum render adjudicative decisions based upon the investigation, any other pertinent 

information (such as polygraphs when applicable), and the adjudicative criteria for the 

particular type of decision rendered (e.g., eligibility for access to classified information, 

suitability for Federal employment, etc.). Because NBIB does not conduct adjudications, they 

are not considered to be part ofNBIB's processes and/or the current inventory referenced in 

the chart below. 

As of February 1, 2017, there were 554,437 cases in our current inventory. What follows is a 

breakdown of the case types by category. 

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Pending Current Inventory* 

As of: 21112017 

187,41 14,97 

Initial 352,047 Reinvestigation 8 Other 2 

National Security 244,530 National Security 173,333 

SSBI 70,206 SSBI-PR 9,089 ASI 13 

TierS 17,458 Phase PR 36,772 MFI 3 

ANACI 402 Tier5R 30,516 NAC 6,685 

NACLC 2,005 Tier3R 66,956 RSI 4,497 

Tier3 154,459 SAC 3,772 

SAC I 2 

Suitability/Fitness 

I Suitability/Fitness/ 

Credentialing 107,517 Credentialing 14,085 

NACI 1,516 Tier2RS 6,172 

Tier1 35,718 PRI 5,051 

MBI 11,909 Tier4R 2,862 

Tier2S 38,563 

Bl 14,959 

Tier4 4,852 

*Note: Volumes provzded are szmply the pendmg case volume (mventory on-hand). Not 

all these cases should be considered "backlog" as it is normal to have some cases 

pending at any given point in time. NBIB 's long-term goal is to reduce pending inventory 

to 160k to 180k cases at any time, a level that can be processed with current workforce 

capacity. 

2. Regarding the backlog, how are you prioritizing the case types which are addressed 

first? 

Response: As a general rule, NBIB assigns cases based on the oldest case due date, with 

initial cases being the primary focus. 

NBIB works with customer agencies, however, to identify high risk populations, or 

individuals with special circumstances, which require expedited service. NBIB staff meets 

with customer agencies routinely to understand their needs and, in some instances, creates 

special processes to flag cases for prioritization. 

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NBIB is committed to working with our customers to address their needs and investigations 

as quickly as possible. 

3. How old is the oldest pending case? 

Response: There are currently 21 cases that are greater than 1,000 days old, with the oldest 

being 1,300 days old. Cases falling into this category are generally awaiting a response from 

a third party record provider, preventing the case from closing. In most of these situations, 

the third party record provider has a separate pending/ongoing investigation (e.g., potentially 

criminal) on the subject of the NBIB investigation. In an effort to avoid jeopardizing the 

ongoing investigation, the third party record provider will not release a final result to NBIB 

until the investigation is complete. Occasionally, the cases are pending a subject interview 

which cannot be completed due to the extenuating circumstance of the subject being out of 

the country for extended periods of time in a location that is not conducive to interview. In 

cases like these, NBIB makes customer agencies aware of the pending investigative lead and 

these agencies have the ability to view or request a copy of the partially completed 

investigation. The customer agency can use the partially completed investigation to inform 

an adjudicative decision or to discontinue the investigation if it is no longer needed. 

4. In January 2017, NBIB increased the interval of security clearance reinvestigations 

from 5 years to 6 years in an effort to reduce the backlog of pending open cases. 

a. Is this really the right way to reduce the backlog? 

Response: NBIB does not have the authority to amend the interval for security clearance 

reinvestigations and did not take this action. The Director of National Intelligence, in his role 

as the Security Executive Agent, is responsible for developing uniform and consistent 

policies and procedures to ensure the effective, efficient, and timely completion of 

investigations and adjudications relating to the determinations by agencies of eligibility for 

access to classified information or eligibility to hold a sensitive position. For additional 

information pertaining to the periodicity of reinvestigations, NBIB defers to the Office of the 

Director of National Intelligence (ODNI) for current policy and guidance issued to agencies. 

b. Doesn't this potentially create a security vulnerability? 

Response: The Director of National Intelligence, in his role as the Security Executive Agent, 

is responsible for developing uniform and consistent policies and procedures to ensure the 

effective, efficient, and timely completion of investigations and adjudications relating to the 

determinations by agencies of eligibility for access to classified information or eligibility to 

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hold a sensitive position. For additional information pertaining to security vulnerabilities 

associated with such policy changes, NBIB defers to ODNI. 

5. What other alternatives have you considered to reduce the backlog for 

reinvestigations? 

Response: Since 2016, NBIB has been growing capacity in order to apply more resources 

and productive hours to the workload. The investigative workforce of Federal employees has 

grown from 1,300 investigators in 2014 to over 1,500 today, with a target level of 

approximately 2,000 Federal investigators by FY18. Further, NBIB continues to shift 

resources and apply overtime where applicable to combat growing workload bubbles by 

locality and identify efficiencies where applicable. For example, since April 2016, 311 

Federal investigators have traveled outside their permanent duty stations in support of 

localized surges. 

In addition, we have worked with our vendors to grow new capacity to approximately 4000 

contractor field investigative staff to devote to this workload. The contract vendors are also 

recruiting new staff and have many new investigators in their hiring and training pipeline. 

However, the ramp up time for new investigators can be extensive, because these 

investigators must themselves undergo rigorous vetting and must complete a training 

program under national investigative training standards, through an accredited training 

course and on-the-job training. 

We have also implemented a number of efforts to thoughtfully reduce the level of effort 

required to complete investigations and increase our efficiency, ultimately increasing the 

production from our investigative resources. For example, NBIB has: 

• Implemented a new writing style, Focused Report Writing, to reduce the amount 

of time spent writing reports. The initiative reduces typing time by focusing the 

writing on adjudicative material and eliminating unnecessary information. It 

redirects time to active investigation, thereby improving efficiency. 

• Revised telephonic interview guidance to allow more flexibility without 

impacting quality. 

• Worked closely with its customer agencies to enable greater scheduling of 

geographically-centralized interviews to reduce travel time as much as possible, 

and to expand interviews via video teleconference (VTC) where no known 

derogatory information exists. 

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• Implemented all five tiers of the 2012 Federal Investigative Standards, in 

accordance with the Initial Operating Capability (IOC) jointly issued by the 

ODNI (as Security Executive Agent) and OPM (as Suitability Executive Agent), 

and is currently working to convert certain legacy case types in our inventory to 

the new standards as directed by the Director of National Intelligence to refine the 

level of effort. 

6. What percentage of the 569,000 backlogged cases do you expect to have completed 

by FY 2018? 

Response: As of February 1, 2017, NBIB's current inventory is 554k investigations. After 

climbing throughout FY 2015-16, this inventory level has remained relatively stable since Q1 

FY 2017. From the start ofFY 2017 (October 1, 2016) through February I, 2017, NBIB has 

closed 808k investigations. This would put NBIB on pace to complete approximately 2.4M 

investigations by the end of FY 2017. 

At the same time, new case requests continue to come in at a steady pace, roughly equal to 

our completion rate, which will therefore still leave NBIB with a significant inventory as we 

enter FY 2018. We continue to increase capacity by applying more resources and productive 

hours to the workload, in an effort to reduce the open inventory to a long-term target level of 

160k to 180k cases. 

7. Will you have one or two of the vendors starting with the oldest cases and moving 

forward? 

a. How are you going to spread out the work to ensure the backlog is drawn down 

efficiently? 

Response: The incumbent contractors, CACI and Key Point, received their initial case load 

under the new contracts on February 1, 2017. CSRA received its initial cases on February 16, 

2017. Securitas is expected to begin taking cases after completion of the System Security 

Authorization and Accreditation process, which is anticipated to be completed by May I, 

2017. 

As new capacity is added to the program, the workload is analyzed in a manner to determine 

the most effective and efficient way to utilize the available capacity to complete the cases 

based on the priorities. Further, in accordance with NBIB's prioritization strategy addressed 

in an earlier question, the oldest workload is generally being assigned first with a focus on 

initial cases. 

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8. How many field investigators over the four vendors, and including NBIB staff 

investigators, does NBIB have available to address the outstanding number of 

investigations? 

Response: As of March 27, 2017, NBIB has a Federal investigative workforce of 1514 fulltime equivalents (FTE). In addition, 118 individuals are in training class or in on-the-job 

training. NBIB is in the process of hiring additional investigators over the next several 

months, with a target of 1975 total Federal investigators. 

As of March 27, 2017, NBIB's contractor field investigative staff, as reported by the contract 

vendors, consists of approximately 4058 FTE. The contract vendors are also recruiting new 

staff and have many new investigators in their hiring and training pipeline. 

9. It has been reported that each vendor is guaranteed $1M under the existing contracts. 

Are there award fees associated with these contracts? 

Response: The fieldwork contracts are structured as indefinite delivery indefinite quantity 

contracts as defined in the Federal Acquisition Regulation. The contracts do not contain an 

award fee. 

10. By the terms of the contracts, how many cases is each vendor expected to complete 

per month? 

Response: The contract is structured to require quality cases to be delivered within specific 

timeliness standards for each case type. Each company's performance under the contract is 

based upon how many cases meet those standards and not based upon the number of cases 

produced. However, the contract sets a maximum ceiling of "units of work" (UOW) that can 

be ordered monthly from each vendor. Each case type ordered requires a different amount of 

UOW to complete, so the maximum UOW under the contracts does not specifically correlate 

to a set number of cases to be completed each month. 

II. Has NBIB implemented all of the tiers of the 2012 Federal Investigative Standards 

when conducting background investigations? 

Response: Yes, NBIB has implemented tiered investigations under the implementation plan 

developed by the Director of National Intelligence as the Security Executive Agent and the 

Director of OPM as the Suitability Executive Agent for the 2012 Federal Investigative 

Standards. While all of the tiers have been implemented, the phased implementation plan 

specifically calls for IOC, to be followed by Full Operating Capability (FOC). The IOC date 

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for Tiers 1 and 2 was October 1, 2014; for Tier 3, the IOC date was October 1, 2015; and 

Tiers 4 and 5, the IOC date was October 1, 2016. FOC is scheduled for October 2017. 

a. If no, why not? 

Response: Not applicable. 

12. Has there been an increase or decrease in the number of days to complete an 

investigation since the implementation of the final tiers of the 2012 Federal 

Investigative Standards on 1 October 20 16? 

Response: Although our overall timeline numbers have increased slightly, we do not believe 

this is a direct result of the new tiered structure. The increase in time is largely affected by 

older cases being worked out of the inventory and not necessarily a result of a processing 

time increase related to the tiered structure. 

Note- Implementation of the FOC of the Federal Investigative Standards is scheduled for 

October 2017. 

13. Has NBIB implemented a Continuous Evaluation solution for clearance holders under 

its jurisdiction? 

Response: Yes, NBIB is able to offer customer agencies today a continuous evaluation (CE) 

product that satisfies the guidance issued by the Director of National Intelligence in his role 

as the Security Executive agent. In this role, the Director of National Intelligence established 

a phased implementation approach for CE. NBIB will continue to expand coverage to fulfill 

future requirements and guidance issued by ODNI. 

a. If no, why, and when do you expect to implement? 

Response: Not applicable. 

b. If yes, what databases are being checked in the continuous evaluation, and are the 

checks automated? 

Response: NBIB's CE information collection product is fully automated. The databases to be 

checked for the initial phase of CE are not identified in the Federal Investigations Notice 

(FIN) 17-03, and this information has not been made available for public release. NBIB 

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defers to ODNI for any further response relating to the information regarding database 

checks. 

14. Will the implementation of Continuous Evaluation reduce the volume of Periodic 

Reinvestigations? 

Response: The Director of National Intelligence, in his role as the Security Executive Agent, 

has not issued a policy allowing agencies to reduce requests for periodic reinvestigations 

(PR) or to change the frequency of PR based on their implementation of CE. Additionally, 

current statutes and presidential executive orders treat PRs and CEs as distinct, yet 

complementary, requirements. See 5 U.S.C. 11001(c)(6) (enhanced personnel security 

programs, including automated record checks of covered persons, are to be "in addition to" 

the periodic reinvestigations described in the Intelligence Reform and Terrorism Prevention 

Act of2004, 50 U.S.C. 3341); E.O. 12968, as amended, sections 3.4 and 3.5 (separately 

requiring periodic reinvestigations and continuous evaluations); see also E.O. 13467, as 

amended, section 1.3(q). 

15. If Continuous Evaluation is to be an automated process, wouldn't there still be a need 

for human analysis of the "hit"? 

Response: As noted above, NBIB does not render the adjudications that result from 

investigative inquiries. Thus, although NBIB's CE information collection product is fully 

automated, agencies receiving the results are still required to adjudicate the information. 

Information received from record searches will be reviewed by customer agencies to 

determine if any additional investigative work (e.g., automated record checks or interviews) 

is warranted prior to the agency adjudicating the investigation. During the adjudication 

process, human analysis is required to render a determination for continued eligibility for 

access to classified information or continued eligibility to hold a sensitive position. 

a. What will be the required response time for adjudicating a hit? 

Response: The adjudication of a hit is the responsibility of the requesting agency. In 

accordance with E.O. 13467, as amended, ODNI is responsible for issuing guidelines and 

instructions to Federal agencies for effective, efficient, and timely adjudications. 

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16. Under Continuous Evaluation, what is the anticipated amount of hits per day or week, 

and have policies been established to address how to respond? 

Response: Since the CE is a recent offering and not all agencies are yet utilizing this 

capability, it is too early to anticipate the amount of hits. As part of the CE, policies have 

been established to provide requesting agencies with results of any hits. 

17. Have there been any clearance holders identified during Continuous Evaluation that 

posed physical danger to the workforce? 

Response: NBIB's product was recently offered to customer agencies to satisfy ODNI's CE 

(Phase I) requirement by September 2017. NBIB has received limited requests as of this 

time, and, therefore, has not yet identified individuals posing a threat to the workforce. We 

defer to agencies on the outcome of their adjudications. 

a. If yes, please provide a summary of what issue was discovered and the action 

taken. 

Response: Not applicable. 

18. Does NBIB have a process or procedure to verify that clearance seekers and holders 

are in compliance with filing federal income tax returns? 

Response: Yes, NBIB does have a procedure in place with the Internal Revenue Service 

(IRS), which is both labor intensive and manual, that we perform on cases where a tax 

concern is raised during the course of an investigation. However, a process that would enable 

the ability to conduct searches on all clearance seekers, as defined by the 2012 Federal 

Investigative Standards, is not yet in place. The requirement is identified as a deliverable for 

FOC. NBIB, in coordination with the Performance Accountability Council, the Suitability 

Executive Agent and the Security Executive Agent, is currently working with the Internal 

Revenue Service to satisfy this new requirement. In the interim, NBIB will continue to 

conduct credit record searches in accordance with both legacy and new Federal Investigative 

Standards, which is an additional way that information about tax compliance can arise. 

19. How is security clearance reciprocity accomplished? 

Response: The Director of National Intelligence, in his role as the Security Executive Agent, 

is responsible for the issuance of policies, development of metrics and conduct of oversight 

regarding reciprocity processes for security clearances. Current polices provide that 

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background investigations and adjudications for security clearances shall be mutually and 

reciprocally accepted by all agencies (see e.g., 50 U.S.C. 334l(d), Executive Order 13467, as 

amended, and the 2012 Federal Investigative Standards), unless otherwise authorized by law. 

Prior to submitting an investigation to NBIB, agencies are required to validate the need for 

the investigation, reciprocally accept another agency's investigation, if one exists within 

scope; and reciprocally accept the security clearance determination, unless there is an 

exception code associated with the adjudication or the agency is aware of new information 

that has not yet been adjudicated. NBJB defers to ODNI for additional guidance pertaining to 

the reciprocity policies for security clearances. In contrast, OPM, as Suitability and 

Credentialing Executive Agent, prescribes reciprocity policy for suitability and identity 

credentialing. 

20. How long does a reciprocity request take to process for each level of clearance? 

Response: The Director of National Intelligence, in his role as the Security Executive Agent, 

is responsible for the issuance of policies, development of metrics and conduct of oversight 

regarding reciprocity processes for security clearances. NBIB's customer agencies are 

responsible for determining whether their applicants may access classified information or 

hold a sensitive position, based on investigations provided by NBIB. NBIB defers to ODNI 

for additional information pertaining to reciprocity-related measures and metrics for security 

clearances. 

21. Is there an executive branch time requirement for how long these requests should 

take? 

a. Is it hours, days, weeks? 

Response: NBIB defers to ODNI for additional information pertaining to reciprocity policies 

for security clearances. 

22. The ODNI published a document entitled, "Strategy and Schedule for Security 

Clearance Reciprocity" in April2014. Among other actions, a reciprocity policy was 

supposed to be issued in FY 2015. Did this occur? 

Response: NBIB defers to ODNI for additional information regarding this policy. 

a. What guidance does NBIB utilize in order to comply with reciprocity 

requirements? 

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Response: NBIB utilizes policies and guidance issued by ODNL Prior to submitting a 

request for an investigation to NBIB, agencies are required to check all three clearance 

repositories to determine if an investigation already exists. If there is an existing in-scope 

investigation and adjudication on ftle, agencies are required to reciprocally accept the 

determination, allowing it is not flagged with an exception code. IfNBIB learns there is an 

existing investigation or adjudication on file and eligible for reciprocity, NBIB will bring this 

to the customer agency's attention so that the customer agency can comply with ODNI's 

current reciprocity policies and guidelines. 

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Questions for Mr. Charles S. Phalen, Jr. 

Director 

National Background Investigations Bureau 

U.S. Office of Personnel Management 

Questions from Ranking Member Elijah E. Cummings 

Committee on Oversight and Government Reform 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

1. What types of security risks are posed when classified information or government 

business is conducted over an unsecured electronic network or device? 

Response: The use of unsecured communication systems to transmit classified information 

would present a risk of adversary collection or unauthorized disclosure of classified 

information, and is prohibited by Executive Order 13526: Classified National Security 

Information. 

2. If the National Background Investigations Bureau (NBIB) discovered that an 

individual with a security clearance was using an unsecured electronic network or 

device, what would it do? 

Response: If it were determined during the course of the investigation that an individual with 

a security clearance or an individual for whom a sponsoring agency is considering for the 

new security clearance used an unsecured electronic network or device to transmit classified 

or sensitive information, either intentionally or unintentionally, the investigator would gather 

information to identifY the extent of possible unauthorized disclosure, circumstances 

involved, individuals involved, and other information needed. This information would be 

provided to the customer agency as part of the completed investigation to inform the 

agency's determination whether or not the individual should obtain or retain a security 

clearance. In the event the individual is currently engaging in such behaviors, or ifNBIB 

discovered past events that raised serious concerns, NBIB would immediately notify the 

sponsoring agency so that necessary actions could be taken, which could include removing 

the individual from access pending completion of the investigation. 

3. Please provide copies of any policies or regulations related to the use of unsecured 

networks or devices to transmit classified information or conduct general government 

business. 

Response: OPM is aware of regulations at 32 C.F.R. Part 2001 Classified National 

Security Information- that address transmission of classified documents, and to which OPM 

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adheres. OPM also adheres to Executive Order 13526: Classified National Security 

Information, prohibiting the transmission of classified information on systems that are not 

designated national security systems or approved to process and store information at the 

appropriate level of classification. 

For the systems conducting unclassified general government business, OPM follows the 

Federal Information Security Modernization Act (FISMA) and National Institute of 

Standards and Technology (NIST) standards and guidelines for protection of information and 

information systems. 

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Questions for Mr. Charles S. Phalen, Jr. 

Director 

National Background Investigations Bureau 

U.S. Office of Personnel Management 

Questions from Chairman Will Hurd 

Subcommittee on Information Technology 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

Issue: Contractor Capacity 

At the end oftlscal year 2016, there were 569,000 cases backlogged at OPM. In September 

2016, OPM awarded contracts to four contractors to conduct background investigations. OPM 

awarded background investigation contracts to four contractors (two incumbents and two new 

contractors)- reportedly in an effort to increase capacity and address the backlog. OPM said in 

the September 20 16 contract announcement that the new contractors were expected to be 

operational by December 1, 2016. 

I. What is the base period and what are the option periods for this contract? 

Response: The contracts are structured with a base and three option periods, which represent 

ordering periods in which NBIB can issue task orders. NBIB assigns cases under the terms of 

those task orders. The following are the base and optional ordering periods: 

Base Period: December I, 2016 through September 30,2018 

Option I: October I, 2018 through September 30,2019. 

Option 2: October I, 2019 through September 30,2020 

Option 3: October 1, 2020 through September 30,2021 

2. When did the contract period begin? 

Response: The contract period began December 1, 2016. NBIB issued the first task orders to 

CACI, KeyPoint, and CSRA on January 30, 2017, and assigned the initial case load to CACI 

and Key Point on February 1, 2017. NBIB assigned the initial case load to CSRA on February 

16,2017. NBIB extended the first task orders with CACI, Key Point, and CSRA, and issued 

the first task order to Securitas, on March 30, 2017. NBIB assigned the initial case load to 

Securitas on April21, 2017, after Securitas secured an authorization to operate on April18, 

2017. 

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3. Were the new contractors operational and working cases on December 1st? 

Response: No. 

a. If not, why not? 

Response: In an effort to enhance the protection of the government investigative data, the 

OPM Chief Information Officer directed contract IT security requirements which were fully 

vetted and finalized by December 22,2016. This resulted in the contractors delaying the 

purchasing of their laptops and finalizing the security protocols for their contractor systems. 

Once the revised process and requirements were finalized, the contractors quickly moved to 

purchase hardware and proceed forward with their contractor systems. 

b. Who has the final authority to authorize these contractors to begin operations? 

Response: The Contracting Officer, based, in part, on the input from the OPM Office of the 

Chief Information Officer and the NBIB program office, has the authority to permit the 

contractors to begin operations. 

c. When will these two new contractors to be operational? 

Response: CSRA is operational and began taking case assignments on February 16, 2017. 

Securitas received their System Security Authorization and Accreditation on Aprill8, 2017, 

and received their first case assignments on April 21, 2017. 

4. How many cases have the incumbent contractors received and processed each month 

since the beginning of this new contract? 

Response: From February 1, 2017 to April30, 2017, the incumbent contractors have 

received the following number of cases: 

KeyPoint- 25,141 (6,303 in February; 7,840 in March; 10,998 in April) cases 

CACI- 17,352 (5,255 in February; 5,543 in March; 6,554 in April) cases 

During that same period, the incumbent contracts submitted the following cases: 

Key Point- 36,187 (10,543 in February; 12,492 in March; 13,152 in April) 

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CACI- 27,124 (8,092 in February; 9,811 in March; 9,221 in April) 

5. How many cases have the new contractors received and processed each month since 

becoming operational? 

Response: CSRA is still in the midst of on-boarding into the program but has received 2,286 

cases and completed 1,461 as of April27, 2017. Securitas received their first load of235 

cases on Apri121, 2017, after achieving ATO on Apri118, 2017. 

6. Under the terms of the contract how many cases are contractors expected to receive 

and process each month? 

Response: The contract is structured to require quality cases to be delivered within specific 

timeliness standards for each case type. Each company's performance under the contract is 

based upon how many cases meet those standards and not based upon the number of cases 

produced. However, the contract sets a maximum ceiling of "units of work" (UOW) that can 

be ordered monthly from each vendor. Each case type ordered requires a different amount of 

UOW to complete, so the maximum UOW under the contracts does not specifically correlate 

to a set number of cases to be completed each month. 

7. How many field investigators does OPM have available to address the outstanding 

number of investigations? Please provide the number of field investigators by 

contractor and Federal employees. 

Response: As of March 27, 2017, NBIB has a federal investigative workforce of 1514 fulltime equivalents (FTE). In addition, 118 individuals are in training class or on-the-job 

training. NBIB is in the process of hiring additional investigators over the next several 

months, with a target of 1975 total federal investigators. 

As of March 27, 2017, NBIB' s contractor field investigative staff, as reported by the contract 

vendors, consists of approximately 4058 FTE. The contract vendors are also recruiting new 

staff and have many new investigators in their hiring and training pipeline. 

8. Given the currently available contract and federal resources, by when do you expect 

to have made progress in addressing the current backlog? 

Response: As of February 1, 2017, NBIB's current inventory is 554k investigations. After 

climbing throughout FY 2015-16, this inventory level has remained relatively stable since Q I 

FY 2017. From the start ofFY 2017 (October 1, 2016) through February 1, 2017, NBIB has 

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closed 808k investigations. This would put NBIB on pace to complete approximately 2.4M 

investigations by the end of FY 2017. Given this statistic, there is a high likelihood that all 

backlogged cases from the beginning of FY 2017 will be completed by FY 2018. 

At the same time, new case requests continue to come in at a steady pace, roughly equal to 

our completion rate, which will therefore still leave NBIB with a significant inventory. We 

continue to increase capacity by applying more resources and productive hours to the 

workload, in an effort to reduce the open inventory to a long-term target level of 160k to 

180k cases. 

9. What is OPM's plan for prioritizing the processing the backlog of cases? 

Response: As a general rule, NBIB assigns cases based on the oldest case due date, with 

initial cases being the primary focus. 

NBIB works with customer agencies, however, to identifY high risk populations, or 

individuals with special circumstances that require expedited service. NBIB staff meets with 

customer agencies routinely to understand their needs and in some instances, creates 

processes to flag cases for prioritization. 

NBIB is committed to working with our customers to address their needs and investigations 

as quickly as possible. 

10. How long will each aspect of the plan take to be implemented? 

Response: Each aspect noted above is a continuous and ongoing effort for NBIB to meet our 

customers' needs. We have met with our contractors to receive their plans on increasing their 

staff to apply to this work and will continue to encourage new capacity growth. Additionally, 

we have implemented initiatives to reduce the time needed to onboard these vital resources 

and will continue to look for additional efficiencies. Every aspect noted above has already 

been implemented and work is being performed to expand each one of those efforts to gain 

the most benefit across the entire program. 

ll. What are the top potential impediments to the successful implementation of the 

backlog reduction plan? 

Response: The largest challenge to NBIB in implementing a succesful backlog reduction 

plan is increasing the field investigative capacity. As noted in previous responses, we have 

hired approximately 500 federal investigators over the last 18 months and will continue to 

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hire throughout FY 2017. In addition, we are working with our contract vendors to increase 

their fieldwork capacity. While not an impediment, a key factor to NBIB's success in 

reducing the backlog will be the development of a more efficient techinical capability to 

support the background investigation lifecycle. Pursuant to Executive Order 13467, as 

amended, we are working with Department of Defense (DoD) to build the National 

Background Investigations Services (NBIS), a whole government approach and capability to 

managing the background investigation lifecycle. 

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Questions for Mr. Charles S. Phalen, Jr. 

Director 

National Background Investigations Bureau 

U.S. Office of Personnel Management 

Questions from Representative Stacey E. Plaskett 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

1. At the hearing, you testified that "the chief of the security office for the White House 

is the determiner for an individual and the senior White House level having a security 

clearance." When I asked who is responsible for selecting the White House's chief 

security officer, as well as the identity of the chief security officer and whether that 

position is a political appointment, you replied, "I actually don't know right now. I 

can find that answer." Please answer the following questions: 

a. What is the name of the White House security chief tasked with approving 

security clearances for White House officials? 

b. Please explain the process for hiring and approving the White House security 

chief. 

c. Please explain whether the White House security chief is an independent position, 

career civil service appointment, or a political appointment. 

d. When did the current White House security chief assume the position? 

Response: The Executive Office of the President (EOP) is responsible for processing 

national security clearances for White House personneL Accordingly, EOP is best suited to 

answer these questions, and NBIB defers to EOP for further response. 

2. At the hearing, you were asked about reports that President Trump met with foreign 

officials in the presence of family members that did not have security clearances. You 

testified: "The President has the ability to grant a clearance or grant access to 

classified information to anyone who they please." Please answer the following 

questions: 

a. What security risks are presented by having individuals without the appropriate 

security clearances present for classified meetings or briefings? 

Response: The President of the United States manages the system of classifYing information 

by executive order (EO 13526). EO 13526 generally describes the potential damage to the 

national security associated with an unauthorized disclosure of classified national security 

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information at three specified levels (Confidential, Secret, and Top Secret). OPM would 

defer to the Office of the Director of National Intelligence for questions about the 

adjudicative requirements for eligibility for access to classified information, and to the 

Justice Department for questions about the legal consequences of unauthorized disclosures of 

classified information. 

b. If an applicant for a security clearance disclosed during a background check that 

he or she had previously shared information with family members who did not 

have similar clearances, please explain the steps the NBIB would take with regard 

to that security clearance applicant. 

Response: Following such a disclosure, the investigator would work to identify the extent of 

the possible unauthorized disclosure, circumstances involved, individuals involved, and other 

information needed to support the final adjudication. Results of the investigations would be 

provided to the agency requesting the investigation in cmmection with the subject's 

eligibility for access to classified information. 

c. How many people working in the White House had their background 

investigations conducted by the National Background Investigations Bureau 

(NBIB)? 

Response: Background investigations for White House employees under the purview of the 

EOP are generally submitted to the Federal Bureau oflnvestigation (FBI), which is EOP's 

cognizant investigative service provider (ISP), not to OPM. 

d. As part of the background check process, does the NBIB check whether an 

applicant for a security clearance has been charged or convicted of any criminal 

laws? 

Response: Yes, part of the background investigation process includes conducting FBI and 

Local Law Enforcement Agency checks. The scope of these checks will depend on the level 

of investigation. 

e. Is the NBIB aware of any individuals working in the Trump Administration who 

were found to have had a prior criminal history and were nevertheless still 

approved for a background check or a security clearance? If so, please provide the 

number of individuals, the names of those individuals with their titles, and the 

name of each individual responsible for approving the background check or 

security clearance. 

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Response: Background investigations for White House employees under the purview of the 

EOP are generally submitted to the Federal Bureau ofinvestigation (FBI), which is BOP's 

cognizant investigative service provider (ISP), not to OPM. 

f. In instances in which the NBIB learns that a White House staff applicant has been 

convicted of a criminal violation, what does it do with that information? 

Response: As noted above, background investigations for White House employees under the 

purview of the EOP are generally submitted to the FBI which is EOP's cognizant ISP, not to 

OPM. NBJB background investigations are conducted in accordance with established 

investigative policies. Issues are investigated to obtain information such as recency of the 

event, surrounding circumstances, rehabilitation efforts, and other background information 

needed to support the final adjudication. Information is documented in the report of 

investigation and submitted to the adjudicative entity. 

g. Who is that information reported to within the Trump Administration? 

Response: NBIB is not the ISP for White House employees. This question is better 

addressed to the FBI. 

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Questions for Mr. Cord Chase 

Chief Information Security Officer 

U.S. Office of Personnel Management 

Questions from Chairman Jason Chaffetz 

Committee on Oversight and Government Reform 

February 2, 2017, Hearing: "Improving Security and Efficiency at OPM and the National 

Background Investigations Bureau" 

1. What kind of notifications is the IT security team required to make before deploying 

security tools onto the network? 

a. If so, what is the purpose of these notifications? 

Response: Based on the wording of these questions, as a whole, we are interpreting the 

phrase "notifications" in this question to mean notifications to employees and employee 

representatives (unions). 

We consider the legal question of whether an agency is required to notify and bargain 

with union representatives prior to making changes in the area of information security to 

be unsettled. So far, this has not affected OPM's timely deployment of security tools. 

2. Have you seen the deployment of such tools delayed because of the need to notify 

union representatives? 

Response: Not at this point in time. 

3. What kind of barriers or challenges have you seen in trying to timely deploy security 

tools? 

Response: As yet, none. 

4. Are there any other administrative or regulatory or bureaucratic barriers at OPM that 

prevent or delay your work the timely deployment of such tools? 

Response: A 2014 administrative decision (U.S. DHS, U.S. ICE, 67 FLRA 501) ofthe 

quasi-judicial, three-member, presidentially appointed and Senate-confirmed Federal 

Labor Relations Authority may have created potential obstacles to delay timely 

deployment at agencies. So far, this has not affected OPM's timely deployment of 

security tools. Additionally, the need for resources may, at times, cause an increase in the 

time for deployment of security tools, however these have not been signiticant delays and 

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often the reallocation and prioritization of resources within the Office of the Chief 

Information Officer can resolve the issue. 

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