II

103D CONGRESS

2D SESSION S. 2056

To amend the National Security Act of 1947 to improve the counterintelligence and security posture of the United States, and for other purposes.

IN THE SENATE OF THE UNITED STATES

MAY 2, 1994

Mr. DECONCINI (for himself and Mr. WARNER) (by request) introduced the

following bill; which was read twice and referred to the Select Committee

on Intelligence

A BILL

To amend the National Security Act of 1947 to improve

the counterintelligence and security posture of the United

States, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Counterintelligence

5 and Security Enhancements Act of 1994’’.
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1 SEC. 2. AMENDMENT TO THE NATIONAL SECURITY ACT OF

2 1947.

3 The National Security Act of 1947 (50 U.S.C. 401

4 et seq.) is amended by inserting at the end thereof the

5 following new title:

6 ‘‘TITLE VIII—ACCESS TO CLASSIFIED

7 INFORMATION

8 ‘‘SEC. 801. The provisions of this title shall not apply

9 to the President and Vice President, Members of the Con10 gress, Justices of the Supreme Court, and Federal judges

11 appointed by the President.

12 ‘‘SEC. 802. The President shall, within one hundred

13 and eighty days of enactment of this title, direct the issu14 ance of a regulation to govern access to classified informa15 tion which shall be binding upon all departments, agen16 cies, and offices of the executive branch.

17 ‘‘SEC. 803. Except as may be provided for in the reg18 ulation issued under section 802 of this title, no person

19 shall be given access to classified information, after the

20 effective date of this title, by any department, agency, or

21 office of the executive branch unless, based upon an appro22 priate background investigation, such access is determined

23 to be clearly consistent with the interests of national secu24 rity.
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1 ‘‘REQUESTS BY AUTHORIZED INVESTIGATIVE AGENCIES

2 ‘‘SEC. 804. (a)(1) Any authorized investigative agen3 cy may request from any financial agency, financial insti4 tution, or holding company, as defined in section 5312 of

5 the Currency and Foreign Transactions Reporting Act (31

6 U.S.C. 5312, as amended) or section 1101 of the Right

7 to Financial Privacy Act of 1978 (12 U.S.C. 3401), or

8 from any consumer credit reporting agency, as defined in

9 section 603 of the Consumer Credit Protection Act (15

10 U.S.C. 1681a), such financial records, other financial in11 formation, and consumer reports as are necessary in order

12 to conduct any authorized law enforcement investigation,

13 counterintelligence inquiry, or security determination. Any

14 authorized investigative agency may also request records

15 maintained by any commercial entity within the United

16 States pertaining to travel by a person outside the United

17 States.

18 ‘‘(2) Requests may be made under this section

19 where—

20 ‘‘(A) the records sought pertain to a person

21 who is or was an employee required by the President

22 in an Executive order, as a condition of access to

23 classified information, to provide consent, during a

24 background investigation and for such time as ac25 cess to the information is maintained, and for not
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1 more than 5 years thereafter, permitting access to

2 financial records, other financial information,

3 consumer reports, and travel records; and

4 ‘‘(B) there is information or allegations indicat5 ing that the person is, or may be, disclosing classi6 fied information in an unauthorized manner to a for7 eign power or agent of a foreign power, or an issue

8 of otherwise unexplained affluence or excessive in9 debtedness arises in the course of any background

10 investigation or reinvestigation.

11 ‘‘(3) Each such request—

12 ‘‘(A) shall be accompanied by a written certifi13 cation signed by the department or agency head or

14 deputy department or agency head concerned and

15 shall certify that—

16 ‘‘(i) the person concerned is or was an em17 ployee within the meaning of subparagraph

18 (2)(A) above;

19 ‘‘(ii) the request is being made pursuant to

20 an authorized inquiry or investigation and is

21 authorized under this section; and

22 ‘‘(iii) the records or information to be re23 viewed are records or information which the

24 employee has previously agreed to make avail-
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1 able to the authorized investigative agency for

2 review;

3 ‘‘(B) shall contain a copy of the agreement re4 ferred to in subparagraph (A)(iii);

5 ‘‘(C) shall identify specifically or by category

6 the records or information to be reviewed; and

7 ‘‘(D) shall inform the recipient of the request of

8 the prohibition described in subsection (b).

9 ‘‘(b) Notwithstanding any other provision of law, no

10 governmental or private entity, or officer, employee, or

11 agent of such entity, may disclose to any person, other

12 than those officers, employees, or agents of such entity

13 necessary to satisfy a request made under this section,

14 that such entity has received or satisfied a request made

15 by an authorized investigative agency under this section.

16 ‘‘(c)(1) Notwithstanding any other provision of law

17 except section 6103 of title 26, United States Code, an

18 entity receiving a request for records or information under

19 subsection (a) shall, if the request satisfies the require20 ments of this section, make available such records or infor21 mation within thirty days for inspection or copying, as

22 may be appropriate, by the agency requesting such records

23 or information.

24 ‘‘(2) Any entity (including any officer, employee, or

25 agent thereof) that discloses records or information for in-
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1 spection or copying pursuant to this section in good faith

2 reliance upon the certifications made by an agency pursu3 ant to this section shall not be liable for any such disclo4 sure to any person under this title, the constitution of any

5 State, or any law or regulation of any State or any politi6 cal subdivision of any State.

7 ‘‘(d) Subject to the availability of appropriations

8 therefor, any agency requesting records or information

9 under this section may reimburse a private entity for any

10 cost reasonably incurred by such entity in responding to

11 such request, including the cost of identifying, reproduc12 ing, or transporting records or other data.

13 ‘‘(e) An agency receiving records or information pur14 suant to a request under this section may disseminate the

15 records or information obtained pursuant to such request

16 outside the agency only to the agency employing the em17 ployee who is the subject of the records or information,

18 to the Department of Justice for law enforcement or coun19 terintelligence purposes, or, with respect to dissemination

20 to an agency of the United States, only if such information

21 is clearly relevant to the authorized responsibilities of such

22 agency.

23 ‘‘(f) Nothing in this section shall affect the authority

24 of an investigative agency to obtain information pursuant

25 to the Right to Financial Privacy Act (12 U.S.C. 3401
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1 et seq.) or the Fair Credit Reporting Act (15 U.S.C. 1681

2 et seq.).

3 ‘‘DEFINITIONS

4 ‘‘SEC. 805. For purposes of this title—

5 ‘‘(a) the phrase ‘classified information’ means

6 any information that has been determined pursuant

7 to Executive Order No. 12356 of April 2, 1982, or

8 successor orders, or the Atomic Energy Act of 1954,

9 to require protection against unauthorized disclosure

10 and that is so designated;

11 ‘‘(b) the term ‘employee’ includes any person

12 who receives a salary or compensation of any kind

13 from the United States Government, is a contractor

14 of the United States Government or an employee

15 thereof, is an unpaid consultant of the United States

16 Government, or otherwise acts for or on behalf of

17 the United States Government;

18 ‘‘(c) the term ‘authorized investigative agency’

19 means an agency authorized by law or regulation to

20 conduct a counterintelligence investigation or inves21 tigations of persons who are proposed for access to

22 classified information to ascertain whether such per23 sons satisfy the criteria for obtaining and retaining

24 access to such information; and

25 ‘‘(d) the term ‘State’ means any State of the

26 United States, the District of Columbia, the Com-
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1 monwealth of Puerto Rico, the Trust Territory of

2 the Pacific Islands, and any territory or possession

3 of the United States.

4 ‘‘EFFECTIVE DATE

5 ‘‘SEC. 806. This title shall take effect one hundred

6 eighty days after the date of its enactment.’’.

7 SEC. 3. DISCLOSURE OF CONSUMER CREDIT REPORTS FOR

8 COUNTERINTELLIGENCE PURPOSES.

9 Section 608 of the Fair Credit Reporting Act (15

10 U.S.C. 1681f) is amended—

11 (1) by striking ‘‘Notwithstanding’’ and insert12 ing ‘‘(a) DISCLOSURE OF CERTAIN IDENTIFYING IN13 FORMATION.—Notwithstanding’’; and

14 (2) by adding at the end the following new sub15 section:

16 ‘‘(b) DISCLOSURES TO THE FBI FOR COUNTER17 INTELLIGENCE PURPOSES.—

18 ‘‘(1) CONSUMER REPORTS.—Notwithstanding

19 the provisions of section 604, a consumer reporting

20 agency shall furnish a consumer report to the Fed21 eral Bureau of Investigation when presented with a

22 written request for a consumer report, signed by the

23 Director or Deputy Director of the Federal Bureau

24 of Investigation who certifies compliance with this

25 subsection. The Director or Deputy Director may
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1 make such a certification only if he has determined

2 in writing that—

3 ‘‘(A) such records are necessary for the

4 conduct of an authorized foreign counterintel5 ligence investigation; and

6 ‘‘(B) there are specific and articulable

7 facts giving reason to believe that the consumer

8 whose consumer report is sought is a foreign

9 power or an agent of a foreign power, as de10 fined in section 101 of the Foreign Intelligence

11 Surveillance Act of 1978 (50 U.S.C. 1801).

12 ‘‘(2) IDENTIFYING INFORMATION.—Notwith13 standing the provisions of section 604, a consumer

14 reporting agency shall furnish identifying informa15 tion respecting a consumer, limited to name, ad16 dress, former addresses, places of employment, or

17 former places of employment, to the Federal Bureau

18 of Investigation when presented with a written re19 quest, signed by the Director or Deputy Director,

20 which certifies compliance with this subsection. The

21 Director or Deputy Director may make such certifi22 cation only if the Director or Deputy Director has

23 determined in writing that—
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1 ‘‘(A) such information is necessary to the

2 conduct of an authorized foreign counterintel3 ligence investigation; and

4 ‘‘(B) there is information giving reason to

5 believe that the consumer has been, or is about

6 to be, in contact with a foreign power or an

7 agent of a foreign power, as so defined.

8 ‘‘(3) CONFIDENTIALITY.—No consumer report9 ing agency or officer, employee, or agent of such

10 consumer reporting agency may disclose to any per11 son, other than those officers, employees, or agents

12 of such agency necessary to fulfill the requirement

13 to disclose information to the Federal Bureau of In14 vestigation under this subsection, that the Federal

15 Bureau of Investigation has sought or obtained a

16 consumer report or identifying information respect17 ing any consumer under paragraph (1) or (2), nor

18 shall such agency, officer, employee, or agent include

19 in any consumer report any information that would

20 indicate that the Federal Bureau of Investigation

21 has sought or obtained such a consumer report or

22 identifying information.

23 ‘‘(4) PAYMENT OF FEES.—The Federal Bureau

24 of Investigation may, subject to the availability of

25 appropriations, pay to the consumer reporting agen-
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1 cy assembling or providing credit reports or identify2 ing information in accordance with this title, a fee

3 for reimbursement for such costs as are reasonably

4 necessary and which have been directly incurred in

5 searching, reproducing, or transporting books, pa6 pers, records, or other data required or requested to

7 be produced under this subsection.

8 ‘‘(5) LIMIT ON DISSEMINATION.—The Federal

9 Bureau of Investigation may not disseminate infor10 mation obtained pursuant to this subsection outside

11 of the Federal Bureau of Investigation, except to the

12 Department of Justice or as may be necessary for

13 the conduct of a foreign counterintelligence inves14 tigation.

15 ‘‘(6) RULES OF CONSTRUCTION.—Nothing in

16 this subsection shall be construed to prohibit infor17 mation from being furnished by the Federal Bureau

18 of Investigation pursuant to a subpoena or court

19 order, or in connection with a judicial or administra20 tive proceeding to enforce the provisions of this Act.

21 Nothing in this subsection shall be construed to au22 thorize or permit the withholding of information

23 from Congress.

24 ‘‘(7) REPORTS TO CONGRESS.—On an annual

25 basis, the Attorney General of the United States
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1 shall fully inform the Permanent Select Committee

2 on Intelligence of the House of Representatives and

3 the Select Committee on Intelligence of the Senate

4 concerning all requests made pursuant to para5 graphs (1) and (2).

6 ‘‘(8) DAMAGES.—Any agency or department of

7 the United States obtaining or disclosing credit re8 ports, records, or information contained therein in

9 violation of this subsection is liable to the consumer

10 to whom such records relate in an amount equal to

11 the sum of—

12 ‘‘(A) $100, without regard to the volume

13 of records involved;

14 ‘‘(B) any actual damages sustained by the

15 consumer as a result of the disclosure;

16 ‘‘(C) if the violation is found to have been

17 willful or intentional, such punitive damages as

18 a court may allow; and

19 ‘‘(D) in the case of any successful action to

20 enforce liability under this subsection, the costs

21 of the action, together with reasonable attor22 ney’s fees, as determined by the court.

23 ‘‘(9) GOOD FAITH EXCEPTION.—Any credit re24 porting agency or agent or employee thereof making

25 disclosure of credit reports or identifying informa-
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1 tion pursuant to this subsection in good faith reli2 ance upon a certificate of the Federal Bureau of In3 vestigation pursuant to this subsection shall not be

4 liable to any person for such disclosure under this

5 title, the constitution of any State, or any law or

6 regulation of any State or any political subdivision

7 of any State. As used in this subsection, the term

8 ‘State’ means any State of the United States, the

9 District of Columbia, the Commonwealth of Puerto

10 Rico, the Trust Territory of the Pacific Islands, and

11 any territory or possession of the United States.

12 ‘‘(10) LIMITATION OF REMEDIES.—The rem13 edies set forth in this subsection shall be the only ju14 dicial remedies for violation of this subsection.

15 ‘‘(11) INJUNCTIVE RELIEF.—In addition to any

16 other remedy contained in this subsection, injunctive

17 relief shall be available to require compliance with

18 the procedures of this subsection. In the event of

19 any successful action under this subsection, costs of

20 the action, together with reasonable attorney’s fees,

21 as determined by the court, may be recovered.’’.

22 SEC. 4. REWARDS FOR INFORMATION CONCERNING ESPIO23 NAGE.

24 (a) REWARDS.—Section 3071 of title 18, United

25 States Code, is amended—
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1 (1) by inserting ‘‘(a)’’ before ‘‘With respect to’’;

2 and

3 (2) by adding at the end the following new sub4 section:

5 ‘‘(b) With respect to acts of espionage involving or

6 directed at the United States, the Attorney General may

7 reward any individual who furnishes information—

8 ‘‘(1) leading to the arrest or conviction, in any

9 country, of any individual or individuals for commis10 sion of an act of espionage against the United

11 States;

12 ‘‘(2) leading to the arrest or conviction, in any

13 country, of any individual or individuals for conspir14 ing or attempting to commit an act of espionage

15 against the United States; or

16 ‘‘(3) leading to the prevention or frustration of

17 an act of espionage against the United States.’’.

18 (b) DEFINITIONS.—Section 3077 of such title is

19 amended by inserting at the end thereof the following new

20 paragraph:

21 ‘‘(8) ‘act of espionage’ means an activity that is

22 a violation of—

23 ‘‘(A) section 793, 794, or 798 of title 18,

24 United States Code;
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1 ‘‘(B) section 783(b) of title 50, United

2 States Code; or

3 ‘‘(C) section 4 of the Subversive Activities

4 Control Act of 1950 (50 U.S.C. 783).’’.

5 (c) CLERICAL AMENDMENTS.—The items relating to

6 chapter 24 in the table of chapters at the beginning of

7 such title, and in the table of chapters at the beginning

8 of part II of such title, are each amended by adding at

9 the end the following: ‘‘and espionage.’’.

10 SEC. 5. ESPIONAGE NOT COMMITTED IN ANY DISTRICT.

11 (a) IN GENERAL.—Chapter 211 of title 18, United

12 States Code, is amended by inserting after section 3238

13 the following new section:

14 ‘‘SEC. 3239. Espionage and related offenses not com15 mitted in any district.

16 ‘‘The trial for any offense involving a violation of—

17 ‘‘(1) section 793, 794, 798, 952, or 1030(a)(1)

18 of this title;

19 ‘‘(2) section 601 of the National Security Act of

20 1947 (50 U.S.C. 421); or

21 ‘‘(3) subsection (b) or (c) of section 4 of the

22 Subversive Activities Control Act of 1950 (50 U.S.C.

23 783 (b) or (c)), begun or committed upon the high

24 seas or elsewhere out of the jurisdiction of any par25 ticular State or district, may be in the District of
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1 Columbia or in any other district authorized by

2 law.’’.

3 (b) CLERICAL AMENDMENT.—The table of sections

4 at the beginning of chapter 211 of such title is amended

5 by inserting after the item relating to section 3238 the

6 following: ‘‘3239. Jurisdiction of espionage outside the

7 United States and related offenses.’’.

8 SEC. 6. CRIMINAL FORFEITURE FOR VIOLATION OF CER9 TAIN ESPIONAGE LAWS.

10 (a) Section 798 of title 18, United States Code, is

11 amended by adding at the end the following new sub12 sections:

13 ‘‘(d)(1) Any person convicted of a violation of this

14 section shall forfeit to the United States irrespective of

15 any provision of State law—

16 ‘‘(A) any property constituting, or derived from,

17 any proceeds the person obtained, directly or indi18 rectly, as the result of such violation; and

19 ‘‘(B) any of the person’s property used, or in20 tended to be used, in any manner or part, to com21 mit, or to facilitate the commission of, such viola22 tion.

23 ‘‘(2) The court, in imposing sentence on a defendant

24 for a conviction of a violation of this section, shall order
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1 that the defendant forfeit to the United States all property

2 described in paragraph (1).

3 ‘‘(3) Except as provided in paragraph (4), the provi4 sions of subsections (b), (c), and (e) through (p) of section

5 413 of the Comprehensive Drug Abuse Prevention and

6 Control Act of 1970 (21 U.S.C. 853 (b), (c), and (e)–(p))

7 shall apply to—

8 ‘‘(A) property subject to forfeiture under this

9 subsection;

10 ‘‘(B) any seizure or disposition of such prop11 erty; and

12 ‘‘(C) any administrative or judicial proceeding

13 in relation to such property, if not inconsistent with

14 this subsection.

15 ‘‘(4) Notwithstanding section 524(c) of title 28, there

16 shall be deposited in the Crime Victims Fund established

17 under section 1402 of the Victims of Crime Act of 1984

18 (42 U.S.C. 10601) all amounts from the forfeiture of

19 property under this subsection remaining after the pay20 ment of expenses for forfeiture and sale authorized by law.

21 ‘‘(e) As used in subsection (d) of this section, the

22 term ‘State’ means any State of the United States, the

23 District of Columbia, the Commonwealth of Puerto Rico,

24 the Trust Territory of the Pacific Islands, and any terri25 tory or possession of the United States.’’.
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1 (b) AMENDMENTS FOR CONSISTENCY IN APPLICA2 TION OF FORFEITURE UNDER TITLE 18.—(1) Section

3 793(h)(3) of such title is amended in the matter above

4 subparagraph (A) by striking out ‘‘(o)’’ each place it ap5 pears and inserting in lieu thereof ‘‘(p)’’.

6 (2) Section 794(d)(3) of such title is amended in the

7 matter above subparagraph (A) by striking out ‘‘(o)’’ each

8 place it appears and inserting in lieu thereof ‘‘(p)’’.

9 (c) SUBVERSIVE ACTIVITIES CONTROL ACT.—Sec10 tion 4 of the Subversive Activities Control Act of 1950

11 (50 U.S.C. 783) is amended by adding at the end the fol12 lowing new subsection:

13 ‘‘(g)(1) Any person convicted of a violation of this

14 section shall forfeit to the United States irrespective of

15 any provision of State law—

16 ‘‘(A) any property constituting, or derived from,

17 any proceeds the person obtained, directly or indi18 rectly, as the result of such violation; and

19 ‘‘(B) any of the person’s property used, or in20 tended to be used, in any manner or part, to com21 mit, or to facilitate the commission of, such viola22 tion.

23 ‘‘(2) The court, in imposing sentence on a defendant

24 for a conviction of a violation of this section, shall order
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1 that the defendant forfeit to the United States all property

2 described in paragraph (1).

3 ‘‘(3) Except as provided in paragraph (4), the provi4 sions of subsections (b), (c), and (e) through (p) of section

5 413 of the Comprehensive Drug Abuse Prevention and

6 Control Act of 1970 (21 U.S.C. 853(b), (c), and (e)–(p))

7 shall apply to—

8 ‘‘(A) property subject to forfeiture under this

9 subsection;

10 ‘‘(B) any seizure or disposition of such prop11 erty; and

12 ‘‘(C) any administrative or judicial proceeding

13 in relation to such property, if not inconsistent with

14 this subsection.

15 ‘‘(4) Notwithstanding section 524(c) of title 28, there

16 shall be deposited in the Crime Victims Fund established

17 under section 1402 of the Victims of Crime Act of 1984

18 (42 U.S.C. 10601) all amounts from the forfeiture of

19 property under this subsection remaining after the pay20 ment of expenses for forfeiture and sale authorized by

21 law.’’.
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1 SEC. 7. DENIAL OF ANNUITIES OR RETIRED PAY TO PER2 SONS CONVICTED OF ESPIONAGE IN FOR3 EIGN COURTS INVOLVING UNITED STATES IN4 FORMATION.

5 Section 8312 of title 5, United States Code, is

6 amended by adding at the end thereof the following new

7 section—

8 ‘‘(d) For purposes of subsections (b)(1) and (c)(1),

9 an offense within the meaning of such subsections is es10 tablished if the Attorney General certifies to the agency

11 administering the annuity or retired pay concerned—

12 ‘‘(1) that an individual subject to this chapter

13 has been convicted by an impartial court of appro14 priate jurisdiction within a foreign country in cir15 cumstances in which the conduct violates the provi16 sions of law enumerated in subsections (b)(1) and

17 (c)(1), or would violate such provisions had such

18 conduct taken place with the United States, and

19 that such conviction is not being appealed or that

20 final action has been taken on such appeal;

21 ‘‘(2) that such conviction was obtained in ac22 cordance with procedures that provided the defend23 ant due process rights comparable to such rights

24 provided by the United States Constitution, and

25 such conviction was based upon evidence which
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1 would have been admissible in the courts of the

2 United States; and

3 ‘‘(3) that such conviction occurred after the

4 date of enactment of this subsection.’’.

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