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-SECRET 

REF ID:A441BB 

• SECRET e 

NATIONAL SECURITY AGENCY 

FORT GEORGE G. MEADE, MARYLAND 

Serial: N 0971 

20 March 1961 

MEMORANDUM FOR THE MEMBERS OF USIB 

. SUBJECT: Industrial Security Pr0grarn (U) 

1. -NSCID No. 6 preseribes for COMINT and ELINT and 

their associated activities "an organi?.tion and management which 

will • • • insure the necessary degree·-of protection"; but it dmits 

any wording easily construed as providing the :neeessary authOrity 

to prescribe security standards and safeguards for COMlNT contracts- awarded te industry on behalf of NSA. Accordingly, the NSA 

industrial security p:rogram is based largely on DOD Directi,,e 

No. S-5100. 20, "The National Security Agency, rr dated 19 March 

1959. In Sectien IV, Paragraph 5, that directive specifies that, 

"within its assigned fields of responsibilities, 11 the Agency shall 

cleve tep requisite security rules, regulations, and standards 

governing operating practices in accordance with the policies'-of. 

the U. S. lntelligenc:e Board. In Section VI, Paragraph A. 6., · ..... . of the same directive, the Director, NSA, is s-pec.ifically delejated 

authority to prescribe or review and approve secu;rity rules, ~egulations, and instructions "as apprepriate." A careful examiliation 

of the authorities cited ab.ove, and of some other directives stemming 

from the Secretary of Defense, leads to the conclusion that a-clarification by USIB of its policy concerning the .release of COMINT to 

cantractors is needed. While the existing directives do not expressly 

prohibit such release {but rather, by implication, encourage it), 

they do not make explicit provision for the handling of COMINT. information in non ... governm.ental establishments. Therefore. while it is 

'Qelieved that the present program is consistent With the intenl'of 

Board policy, it is felt that there is a need for the Board to confirm 

this interpretation. 

2. Because of the necessity to utilize industrial potential in 

the pursuit of our COMINT effort, our industrial security program 

has been gradually developed. - in coo_rdinatl:on with the Offic:e of 

the Assistant Secretary ot- Defense (Man,powet, Personnel an8 

Reserve) a:nd with other agencies as apj>repill'iate. The Department 

of l'J)efense has $Stalllished a "cognizaJlt sef!u:r-ity office" system to 

insure that ·a:rr slassified information in the e·ustedy of a sontractor 

is properly safeguarded. :Because of its COMINT responsibilities, 

,• . 

SECRET 

Declassified and approved for release by NSA on 06-17-2013 pursuant to E. 0. 1352B 

.· 
'. 

REF ID:A441BB 

SECRET 

SECltET Se rial: N 0971 

NSA has undertaken, for each of its COMINT contracts, to assume 

the security responsibilities of the Department of Defe~se "cognizant 

security office" for that portion of the contractor's- facility being 

utilized on the COMINT contract. It is felt that such an approach, 

within the framework of the Department of Defense industrial 

security program, has certain advantages. Some of these advantages are: 

a. The contractor as such can be held responsible 

for a violation of established security procedures. 

b. Action can be taken insofar as the contractor's 

facility clearance is concerned, if the contractor violates the 

prescribed security regulations. 

c. The ~ontractor is in a position to have COMINT 

material in his possession, if this is necessary to meet the operational requirements of the contract. 

3. At the present time, this Agency has certain contracts 

for which some degree of COMINT access has been considered 

requisite to fulfilling the contractual requirements. The contract 

management activities of this Agency authorize such access at a 

contractor's facility only when it is considered absolutely necessary 

to meet an operational requirement. For some other contracts, 

contractor personnel are given COMINT-related (ba.t non-codeword) 

background information. It has been our experience that this is a 

realistic approach ~ the problem; and industry has willingly accepted the security responsibilities associated with this type of 

procurement. 

4. It should be noted that in many cases, particularly where 

devices are being built for specific problems, COMINT information 

can be evidenced in some degree during design, dev_elopment and 

construction, as well ·as testing prior to acceptance by the government. In some cases, moreover, even though COMINT information 

is not directly involved during these phases, the devices themselves 

have obvious COMINT overtones. In addition, it is felt that, in 

those contracts for which COMINT access is deemed essential, so'-

called sanitization of the- COMINT material is a futile gesture. It 

has been our experience, in those cases where sanitization has been 

attempted, that the contractor employees directly involved are 

technically capable of inferring the COMINT underlying the sanitized 

version. The majority of the contractors, moreover, are generating 

HANDLE vIA COMTMT CHA:l'm'ELS OKLY 

2 

SECRET 
REF ID:A441BB 

SE~RET e 

SECRET , Serial: N 0911 

COMINT as a condition of the contract; and it would be difficult, 

if not impossible, to conceal this fact from them. It should also 

be noted, however, that all of the COMINT material, either ·: 

furnished to. or generated by the contractor, is accounted for by 

this Agency through an inventory and control system which includes 

verification by inspection. 

5. The nearest approach to a USIB policy statement in this 

area appears to be Paragraph 44 of DCID No. 6/3, which places 

"upon the Board member, or his properly designated representative, 

of that department or agency directing the project" the responsibility for determining the need-to-know of civilians under contract 

and etnployees and representatives of commercial firms and 

civilian research institutions which are to engage in technical or 

intelligence research or in manufacture of equipment for COMINT 

activities, as well as personnel from non~member government 

departments or agencies involved in such pursuits. In lieu of·the 

promulgation of a more comprehensive and explicit USIB policy 

statement, this paragraph, plus Paragraph 56 concerning indoctrination and Paragraph 77 concerning physical securlffW:hrough 

control of access and dissemination, provide the only USIB-derived 

basis for the corresponding aspects of the NSA industrial sec~rity 

program. .. 

6. In brief, the NSA industrial security program is believed 

to be consistent with the intent of current ·G>ard policy, and it is 

requested that the Board endor~ this ~7._ 

- ,-% ~ / ----:;?"'i. H. FROST . 

Vice Admiral, USN 

Director 

HANBLE '/Ilic COMINT CHANN'El.5 ONLY 

3 

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SECRET 
. . . 

SECRET 

cc: DiitC: C 

AG 

Reading File 

Legal Advisor 

PROD-03 

R/D 

SEC 

OPS (3) 

REF ID:A441BB 

SECRErr 

Serial: N 0971 

M/R: Largely self-explanatory. The NSA industrial security prQgram 

has been developed within the framework of the DOD (OASD, ·MP& R) 

industrial security program, and is believed to be consistent With the 

intent of current USIB policies. However, since DOD Directive 

No. S-5100. 20 requires that "within its assigned fields .of responsibilities, 11 NSA shall develop requisite security rules, etc., ih 

accordance with the policies of USIB, instant correspondence required 

to get USIB confirmation with respect to the NSA industrial security 

program (an area in which no comprehensive and explicit statement 

of USIB policy exists). This memorandum for the members of USIB 

prepared at direction of Director, NSA. Coordinated with and concurred 

in by Legal Advisor (Mr. Banner), SEC'(Mr. Lewe), and PROD-03 

(Mrs. Brewer). Discussed with R/D (Mrs. Haig), who reported that 

Director, R/D, in general concurs in th~ wording of this memorandum, 

but that he believes the Director, NSA, has ,adequate authority under 

existing directives. 

SE(;BET