WAItIEw INTERCEPTION OF INTEPNATIONSL TELECO-MUNICATIONS CoO aes el eee Ne ne Sel ee See SCT Intrséuctica: S7ez this report is the The feceral intelligence agency National Security Agency (NSA). Official published estimates of its size in dollars expended or manpower employed, by either the Legislative or Executive branches, do rot exist.2/ Unofficial estimates are that the NSA annually spends as much as $1$ billion and employs up to 120,000 persons, when military agencies under the “SA's direction are included, 2/ Whatever its actual budget and per- sonnel levels, it has, through a network of over 2,000 Specialized intercept positions eraund the world, the technological capzbility to intercept a significant portion of worlcwide telecommmications. This cazability can be brought to bear against any country. If used against the American zecple, Senator Frank Church has noted, “no Scerican would have any privacy left ... there would be no place to hice." The NSA was created by a seven-page Top Secret memorandum from President Harry S. Truman to Secretary of State Dean G. Acheson and Secretary of Defense Robert A. Lovett, on October 24, 1952. Under this directive, which even today Terains classizied, the \SA assumed the responsibilities of the Armed Forces Security Agency, which in turn had largely inherited the intelligence responsi- bilities of the Army Security Agency (hich remains a functioning Army entity) .2/ The NSA's two basic functions, derived from Top Secret National Security Council and Director of Central Intelligence directives, are: (1) to protect the “Cosmanications Security" (COMSEC) of U.S. telecormmamications that are national security related; and (2) to obtain foreign intelligence related telecommmications through the interception of "Signals Intelligence” (SIGINT). SIGINT interception is the NSA's dominant activity. It consists of ''Com- munications Intelligence’ (CQMINT), or intelligence obtained through the interception of electronic cessage commmications (such as telegracs and telephones),— and “Electronic Intelligence’ (ELINT), intelligence cotained through the interception of ¢lectrenic signals (such as radar and missile s-issions), which were not >
intended by the sender to comnunicate messages. 4h tS A's tes ow This report is primarily concerned with cae pect COMINT activity - acess of wt ee ge telecon menscadreut Sa/ awe + ’ = - . aot v4 mee and us . . - hea TNwe activites arrectem une conmstirnriona:ty ovarenrees riers Of Privacy or --rican citizens. This report also notes, to 2 lesser extent, one COMSEC activity at éxtecds toyond the "protection" of cormunications related to national security, e encroach on the privacy of srerican citizens. th re y fo 4 ~ t- ae) i) w ia Prompted by a press report, °/ the Subcommittee on Government Infomnation and Individual Rights initiated in August 1975, en investigation into the inter- cépticn anc monitoring by federal intelligence agencies, of telegrams and other forcs of cata transmissions entering and leaving the United States. The investigation was undertaken pursuant to the subcommittee's oversight responsibility for matters concerning the rights of privacy of American citizens and for the operations of Feieral Communications Commission. Public hearings were held on October 23, 1975, and February 25, March 3, 10, and 11, 1976. (Hereafter cited as Subcom ittee Hearings.) These hearings were conducted in the face of intense Executive brunch eiforts te have them curtailed or postponed. 2/ Similar pressure was exerted on the Senate Select Committee to Study Goverrcental Operations with Respect to Intelligence Activities. (Hereafter referred tod aited eo Fa Cth Commitinn Uearing? ond Chard Ganithee Fel Perortie te as the Church Comittee, ) On October 7, 1975, Attorney General Edward Levi persenally asked Senator Church on behalf of the President to postpone committee hearings en selected National Security Agency activities, scheduled for October 8 and $, at which NSA Director Lew Allen, Jr. was to testify. The Church Committee agreed to celay Gen. Allen's appearance indefinitely. Whereas the Church Committee had conducted its NSA investigation by going directly to that Agency, the subcomaittee apprcached no government agency, going instead te the international telegraph companies who allegedly had participated in such activities. These companies were initially responsive. It was apparently not witil October 21, 1975 -- two days prior to the subcomittee's initial hearing -- that the Acuinistration became aware of the subcommittee's investigation, at which time it reacted strongly. On that day, the subcommittee received a letter fren FS] Lirector Clarence Kelley, advising that a former FBI special agent, whom &/ the sabcowittee staff had interviewed, would not te allowed to testify.— On the
178 same cay, aS a result of goverment pressure, the two largest international conmon carriers involved -- RCA Global Cersminications and ITT World Communications -- suddenly withores their offers to apnear valuntarity and demanded that they be iecued athneras as a condition to their testifvine. [A representative of owe auethes Sinus communications carrier inworvecrmnestonipetininlinchinmiaabemrereve subsequently infe:red the s.ti7 mittee that highly placed Justice Cepartment officials, immediately prior to the subconmmittee's October 23 hearing, had urged the company to demand subzenas. The company did not accede to the Executive branch request ° heweren, On October 22, 1975, the subcommittee Chairvoman, Representative Bella S. Abzug, was visited by em Deputy Attorney General Harold Tyler, NSA Director Allen, Assistant Secretary of Defense for Intelligence Albert Hall, Special Counsel to the President Jonathan Marsh, and White House Congressional Liaison Charles Leppert, who requested the erticn. hearings not be held on grounds of jeopardizing an ongoing Justice Department a : . OF. - : . criminal investigetion oe® jéopardizing national security. Attorney General Levi unexpectedly arrived at the hearing room, bearing the same messece. Like the previous visitors, Mr. Levi could not say which "national ~ security’ interests were being jeopardized, nor suggest to the subcommittee any course of action beyond postponement or cancellation. The subcommittee's hearing proceeded as scheduled, but former FBI special agent Joe R. Craig, and Tepresentatives of RCA Global Communications and ITT World Communications refused to.testify unless sudpenaed. Testimony was teen irom representatives of American Telephone and Telegraph Company and one of its operating subsidiaries, the Chesapeake § Potomac Telephone Company. Within txo hours of the clese of the subcormittee's October 23 hearing, the Giurch Committee reversed its earlier decision and voted to hold public hearings on the NSA. Qn Octeber 29, NSA Director Allen, accompanied by NSA Deputy Director Benson Buffham and NSA General Counsel Roy Banner, appeared before the Church Committee in public session, essentially confining their testimony to the Agency's ‘watch- list" activity (see p. ). A second matter raised at the hearing, identified as Crerations SH:-R0CK (see p. ), was temporarily put off.
On November 6, in public session, Senator Church read the coumittee's San TOCN iepuri. 4 summary of the Church Cermittee's investigation to date, into the record.2/ No testumory, however, was elicited in public session. The Church report primarily dealt with ccntacts between U.S. telegraph Giclanies and government representatives Lit. .on igarlo/ and 197§, and procedures by “hich private cowunications entrusted to the carriers were turned over to ° the NSA and, to a lesser extent, the FBI. The report did not discuss how the information made available to the intelligence agencies was utilized by its collectors, or to whom it was disseminated, or the uses made of it by those entities -- subjects of vital interest to this Comittee. On February 4, 1976, this Comnittee issued sutpenas ad testificandum and Subpenas duces tecum to three FBI special agents, one former FBI special agent, one NSA employee, and executives of ITT World Communications, RCA Global Com- mmications, and Western Union International. On February 17, President Ford instructed Secretary cf Defense Rumsfeld and Attorney General Levi "to decline to comply with the subpenas" directed to the government and government witnesses, Stating that disclosure of the records scught by the Committee were not in the puslic interest .12/ intediately, Secretary Fumsfeld instructed the NSA emplovee, . and Attorney General Levi instructed the FBI empioyees, that the Committee's subpenas duces tecum were not to be complied with, inasmuch as "President Ford has asserted executive privilege. 22/ On February 17, Attorney General Levi also requested "that Western Union Internationa” ‘onor [President Ford's] invocation of executive privilege, and that it not rroduce and deliver documents described by the said subpenas ,"13/ These applications of “executive privilege" to privete corporations and to, former governnent erployeef » were unprecedented expansions of that concept. On February 25, the aforementioned former Fal employee, three current FsI agents, and one NSA employee appeared before the subcommittee, but refused to testify. Both the present and former FRI agents refused to testify on instructions from the Attorney General, while the NSA emplovee refused on orders from the Deputy Secretary of Defense, William P. Clements, Jr. Because of their fzilure to give testimony, the subcommittee recommended that all five be cited, pursuant to 2 U.S.C. 192, for contempt of Congress. Four of the witnesses were also recormended for contempt citations for their failure to produce documents r-- want to sutpenas. Bes
-5- On March 3, the Exccutive Vice President of Wester Union Intermational testified befcre the subcoumittee, and turned over an eight year old list of NSA targets, the production of which President Ford had attempted to block by asking we Qdipediica tO hour his claun of “caccutive Privilege.” Attorncy General Levi also asked RCA Global Communications that its T-presentativcs aeither testify before the subco-ittee, nor produce documents, “siti procecures can be agreed upon to assure that the President's invocation cz executive privilege is not effectively undone .24/ Without procedures being “agreed upon", representatives of RCA Global Co-runications did testify on March 3, as well as on March 10, and subsequently tamed over to the suice-mittee additional recorés that the company had previously considered as not covered by the subcommittee's subpena duces tecum.25/ Also ex arch 10, the subcommittee received the testimony of the Chaimman of the Feceral Communications Comnission, Richard £. Wiley. “arch ll, rezresentatives of ITT World Commmication, which did not ricsive an “executive privilege" request from Attorney General Levi, testified PART I VUNOLOGY OF U.S, TELEGRAPH COMPANIES’ COOPERATION WITH FEDERAL INTELLIGENCE AGENCIES Pré-orld War IZ. I. History During “cerld War I, U.S. government intelligence agents censored tele- gr2pnic telecccrmications by working in the offices of private telegraph companies. All telegrams entering or leaving the United States were placed at the disposal of a military intelligence unit of the War Department known as MI-8 [Military Intel- lisence - Section 3} 22 This practice ceased soon after the conclusion of the MI-8, frcm its inception in 1917, had been directed by Herbert Osborne Yerdley, considered by scme cryptologists to be the most famous in history. At war's end, faced with the phasing out of his organization, and envisioning its heving a peacetime role, Yardley, in May 1919, convinced the State and War Cerartments to epprove a plan for a "permanent organization for code and cipher 18/ investigation anZ attack.'— Forty thousand dollars of the organization's $227,600 annual rudger «as te come from State Derarttent special funds, with
, -6- e+e talarce to come from military intelligence budgets after selected Congressional setters 22 heen Lriefed on the crorect.29/ Although supported by government funds, the resulting organization had no visible gcvernrent connection. Known as "The Black Chamber" by the few persons ar cith its eaistence, it operated, from 1919 until 1929, under Yardley's lealership in “New York City -- under the cover nane "Code Compilation Company. 20/ Trg operation vas initially situated in tovmhouses in the East Thirties, but fcllowing a 1925 break-in in which desks were rifled, it was moved to a large Manhattan office building. In 1929, President Hoover's newly appointed Secretary of State, Henry L. Stimson was shocked to learn of the Black Chamber's existence and abruptly terminated the operation 2y/ in the belief its activities were shameful in a "world [that] 22/ was Striving with good will for lasting peace.'*— Suddenly without a job and in need of funds, and apparently believing that since the Slack Chamber had been destroyed there was no longer any valid reason for withholding its secrets, Yardley wrote a book, The American Black Chamber, published in 1931, which soon became an international best- seller. In it Yardley boasted: we solved over Zerty-five thousand cryptcgrans from 191¢ to 1929, - and at ene time or “Snother, we broke the codes of Argentine, Brazil, Chile, China, Costa Rica, Cuba, England, France, Germany, Japen, Liberia, Mexico, Nicaragua, Panama, Peru, Russia [sic], San Salvador, Santo Domingo, Soviet Union "and Spain. 23/ Tie Black Chamber, he stated, also made preliminary analyses of the codes of many other govern- ments. nis we did because we never Kiew at what moment a crisis would arise which would reavire quick selution of a particular government's diplomatic telegrams. Our personnel was limited and we could not hope to read the telegrams of all nations. 24/ $ Despite his preclivity towards sensational disclosure, Yardley coyly avoided stating how, in the ten years of MI-8's peacetime existence, from 1919 to 1929, 2 Black Ciarber had obtained telegrams it had analyzed: we exployed guards, replaced all the locks and were ready to begin [in 1919] our secret activities. But there were now no coce and cipher telegrams to work on! The cable censorship had teen lifted and the supervision of messages restored to the private cable companies. Our problem was to obtain copies of messages. How? . I shall not answer.this question directly. Instead I shall tell vou semething of the Soviet Government's type of espionage as revealed by documents that passed through my hands. After you read these, you can draw your on conclusions as to how the United States Government obtained the code and cipher diplomatic messeces of foreign covermuents.25:
CT meal ' _7- Visever, this question was ansser:d in a letter Yardiey sent to his iisksr on “arch 18, 1932, 26/ There he wrote thet none of the messages alluded to in ihe manuscript of The American Black Ghauber, ae me ican black nenber viner inan Certain wireless messages ¢.chanced between Germany acd Mexico, tere sent by radio. They com by ceble. With ect to every cablegram referred to in such book, the copies :3= to whicn I refer therein were chieined ov the consent — Z euthority of the respective presidents of the festem Union siegraph Cor;any and of the Fostal Telegraph Company over the “Tes Of one or the other of such companies such messages were transmitted. [Emphasis added.]} eo we in the 1920's, these cwo companies carried alzost all the telegraphic communications in and out of this country .22/ According to Yardley's book, only coded messages were turned over to MI-8; . : : . 28 Plain text (i.e. uncoded) messages were never made available. 2°/ The Anay Security Agency's 323 page Historical Background of ‘the Signal : Security Agency 1919-1939, which the subcommittee requested and received in tt epee sanitizec form, omits any mention of the arrangement described by Yardley, whereby “3-3 Tetelved telegrarh messages from the Western Union and Postal Telegraph ceorpenies, or any other company. It Suggests only that the Army Signal Corps ci¢ nt continue to support the MI-8 activities: Plans for establishing MI-8 on a peete-time basis in 1929 included no provision for the development of facilities for obtaining the necessary intercepted messages. A detailed account of the situation will be given shortly but at this point it will SutZice to indicate that it was doubtless assumed that the cable co—penies would continue to supply ccpies of all messages passing through their offices and that the Signal Corps would continue its war-time intercept facilities «hich would be at the call of “2-8. These assumptions proved to be uwwarranted. That no sétisfactory solution for this preblem was ever reached was one er the prime causes for the decline of activity of MI-8 in New York. It was also one of the factors which led to the absorption of the Bureau by the Signal Corps, an Orgenization which could tore easily develop intercept facilities .29/ tae “detailed account" of the cable companies' cooperation, suggested in Cas passage, was deleted from the manuscript provided the subcommittee. If Yardley's account is accurate, however, MI-8 did remain operational for ten years after “eric “ar I with the cooperation of the telegraph companies heretofore identified. Firihermore, it was Secretary Stimson's philosophical objections, and not the , Ty I P B} vee eae ctence of the telecreph companies, which apparently brought the activities of Testes: Sf- to @ halt in 1920. Il. Legatity20/ rid War I ended, the Radio Com-nications Act of August 13, 1912, which mov 3 r “et the Govervrent would guarentee the Séurecy Gi Couamications, was Still in eifect. That Act proviced, in pertinent part:
-B: “oO person or persons engaped ir or having knovledge of the cyeration of any station or stations shall divulge or peblish the contents of any messaees transmitted or received ty suck statien, oxcepn to the nerson ar nersons to whom the sa-2 -ay be directed, cr their authorized agent, or to another station employed to forward such message to its wcltinatacd, unless leaclly icquired so te gs by the cours of zc~>etent jurisdiction or other comcetent authority. 31) 2.25 low did not prohibit the intercepticn of radio traffic per se, but . rerely prcnibited the enployees of common carriers covered by the Act from divulging or publishing the contents of messages to unauthorized persons. Al though no court had occasion to so rule, the prohibition contained in the statute would seem to have been violated by those employees of the cable companies who divulged the ccaterits of telegrams to MI-8, unless MI-8 could have been considered as “other canpetent authority". This point has never been the subject of a judicial determination. The 1912 statute remained in effect until the enactment of the Radio Act of 1927, «nich considerably broadened the prehibition against unauthorized disclosures: NO person receiving or assisting in receiving any radio ce‘vmunication shall divulge or publish the contents, substance, Furport, effect, or meaning thereof except through authorized chamnels of transmission or reception to any person other than the addressee, his agent or attorney, or to a telephone, tele- graph, cable or radio station employed or authorized to forward . such vedio comcunication to its destination, or to proper eccsunting er distributing officers of the various commmicating centers over which the radio commmication may be passed, or to the master of a ship under whom he is serving, or in response to a szbpoena issued by a court of competent jurisdiction, or on serand of other lawful authority; and no person not being authorized ine sender snall intercept any message and divulge or publish he contents, substance, purport, effect or meaning of such inter- the certed message to any person; and no person not being entitled thereto shall receive or assist in receiving any radio corami- czticn end use the seme or any information therein contained and no person having received such intercepted radio conmmmication or having become acquainted with the contents, substance, purport, effect, or meaning of the same or any part thereof, knowing that such information was so obtained, shall divulge or publish the contents, substance, purport, effect, or meaning of the sane or any part thereof, or use the same or any information therein conzzined for his own benefit or for the benefit of another not entitled thereto . . .. [Emphasis added. }32/ “whereas the 1912 Act had applied only to exployees of common carriers, the 1527 ct applied to all persons not authorized by the sender to receive such te co-rsnications. This would bring MI-8, as well as the employees of the cable companies, under the Act's prohibition. The Anay Security Agency's historical recor: states that the law's "or on demand of other lawful authority" provision had never teen used by MI-8 to justify its interception of foreign diplomatic traffic. ficparently, there was never a need for MI-& to assert such authority.
a: 9. Henze, subsequent to 1927 at least, the Blacx Charber epparently operated in nA ae ‘joletion of the law. dem Ge Aine asy Security Agency's historical record suggests 2orhe d, chit Gis activities ef rilitary intelligeme Buthecing = - imuluding MI S's -- were rot intended toa te ccvered by the 1927 act's prohibitions: Tae purpose tenind the legislation «was of course, the security of corcunications from the danger of interception Dy authorized zersons who might have rade use of intelli- gence centained therein for personal profit. That the laws would also hamper Governmental agencies engaged in the procuction of intelligence upon which the safety of the United States might be based was probably far from the minds of the legislators. Indeed, prior to World War I, no such agency existed, and until 1931, the fact that one had ex- isted during the war period was unknown either to the general public or to most officers in the Army itself. On the other hand, inclusion in these acts of specific exemptions permitting the interception of radio communications for the purposes of military intelligence would have given notice to the world in general, and therefore to a possible enemy in particular, that cryptanalytic units were indeed operating. Such @ course sould have been highly undesirable. What solution this thomy problem could have had is not clear: the fact that no solution vas ever reached constituted one of the greatest obsiacles to the proper functioning of i2-8 33/ Yarcley infers that the 1929 Act presented no obstacle at all. It was * sictiy ignored. eaction to Yardley Disclicsures The pudlication of Yardley's book, in 1931, prompted the War Departinent to state that the American Black Chamber had not existed for four years (a date which coincided with the passage of the Radio Act in 1927) AY General Douglas Meccrthur, then Amy Chief of Staff, said he did not know anything about it, while high officers in the intelligence divisions said no such bureau then existed ” and they professed to have no knowledge of it in former years .2>/ State Derartvent officials similarly said they were sure there had been no such practice anc cne official, speaking on behalf of Secretary Stimson, said he had never heard of any such organization as the so-called “black chamber.''25/ Yardiey, a man «ho had been revered as a cryptanalytic genius, and who, in 1$2i, nad been avarded the Distinguished Service Medal by the Secretary of War ,2/ was portrayed in official commentaries as an opportunist and braggart whose actions borcered on treason.
Xe -]0- The Army Security Agency hi-tery, written in 1946, described Yardley as a yan sho “had cGemonstrated a certain anount of czyptanalytic ability and had achieved within the War Deparoaent a reputation aS a wr;Piaaliyst.” Me was, the report Stoic, & peur coninistrater vhs hed neither the initjorive sar foresight ‘tn teititm-S cn a firm foundation." He ignored his cuties, the report continued, ‘nile he profited from real estate activities, nis enthusiasm for cryptanalysis lagged as he became a consultant in more profitebie code production activities for comercial firms. Then, when his own position was abolished, he divulged infor-ation of the highest secrecy and made hirself notorious in the annals of eryptolegy."138/ Tx 1932, Yardley wrote a new book entitled "Japanese Diplomatic Secrets" that «as never published. On February 20, 1933, U.S. marshals in New York seized the ranuscript in the publishing effices of The Macmillan Company, on the grounds Yardley, es an agent of the U.S. government, hac appropriated secret documents 22/ Yardley ~as never prosecuted, but his case provzted Congress to enact the Protection of Goverrment Records" bill in 1933. Now codified as 18 U.S.C. 952, the law makes Giscicsure of diplomatic codes or correspondence a felony. Ty. Assessment of MI-8 by the Army Security agency £9/ ‘ According to the Amy Security Agency's historical chronology, MI-8 primarily , failed because "its principal support was derived from a department of the govern- ment which reflected political changes and the terper of the times more directly than does the War Department."" In other words, such a sensitive activity as MI-8 25 10t tO be entrusted to the political whirs cf the country's civilian leadership. The tmy Security Agency, in hindsight, also sew other rezsons for MI-8's demise: (1) Its leader was not sufficiently concerned with its secrecy (though there is no evidence Yardley cempromised the secrecy of the "Black Chamber" in any way, during its twelve year existence). (2) Its isolation from direct supervision as a result of its trans- fer to New York produced neither the desired secrecy nor the attention it should have had from tie “ar Department (though there was every evidence, from Yardley's narration, its existence was well known at the highest State and War Department levels). (3) The separation of cryptanalysis (breaking the codes and ciphers of foreign governments) and cryptography (making codes and ciphers for one's own governrent) was a mistake. (MI-8 was not involved in cryptography).
-li- Even before '-S formally terminated its operations on October 31, 1929, the ar Sopartcont had Farmed the Signal Intelligence Service within the A “i . by Sede Department dafaul * “eaphlge carry out most crviological work on a continuing basis. Tletetetnesieiencantiine ee? writin “= teTne with: te why ee tle a ry gicrze tun a ae & preculture te i the Armed Porce’ Security Service and its successor, the Metional Security sgency. Post Vorld “ar HW I, History During “orld “ar II, U.S. government agents pursuant to the wartime powers of the President, again censored written telecomminications by working in the offices of the telegrezh cc-panies. Three companies -- ITT Ceomcsnications, RCA Commmi- caticns, and Western Union -- transmitted almost all international cablegrams and radiograms entering or leaving the United States. All such messages were placed t the disposal cf military intelligence.— 4u/ fewever, tie Sar Department's post-World War II actions to convince the callie companies to “ake international telegrams available to federal intelligence agents were warkedly different than those taken after World “Nar I. The post “erlée War I period sas marked by inaction: six months after the Armistice, Herbert Yardley had to single-handedly persuade the goverr-ent te enter into such an arrangement and his scheme provided that only coded messeges would be handed over. But in August 1945, immediately after the end of the war, the Army Signal Security Agency (the same as the Signal Intelligence Service and Amy Security Agency) inple- mented a pian thet ied ultimately to making most telegrams ente ering and leaving the United States -- including those in plain text -- available to that agency .42/ On August 18, 1945, four days after Japan surrendered, "two representatives of 1¢ Army Signal Security Agency were sent to New York 'to make the necessary contacts with the heads of the Commercial Commmications Coxpénies in New York, secure their approval of the interception of all [foreign] Governmental traffic entering the United States, leaving the United States, or transiting the United States, and make the necessary arrangements for this photcgraphic intercept work, '1143/ ITT and Western Union began their participation by September 1, 1945, and RCA by Cetober 9, 19:5. 44/
' -12- hile the Amy Signal Security Agency »2s ostensibly only interested in =+2 intcrception of foreign government traffic, in practice it was siven access to aii traffic. This vas necessary, former RCA Executive Vice President Sidney Starks testified, because the procedures initielly proposed by the government-- '° -at special electrical connections be put on certein tielines, or that tapes ct:iginating and terminating with certain tielines be turned over -- would result ia 2 situation where "everybody and his brother «ould know just exactly what ae were Coing end why. "43/ To avoid that revel etion, the government was given, eccording to Mr. Sparks, ‘tall of the perforated tapes," ive., access to all resseges 28/47/ I:T also agreed to allow the Army access to all incoming, outgoing, and transiting messages -- private as well'as governmental -- passing over the facilities Ss > g . ef its subsidiaries involved in international ce-zunications. ITT agreed to record a1] such messezes on microfilm, which the Amy Signals Security Agency $8/ then deveioped.- For the next thirty years, between 1945 end 1975, RCA and ITT -- which ether handled approximately 70 percent of 211 intermational non-verbal tele- etc micetions in and out of this country -- centinued to make all their customers' co-nicetions availeble to the NSA.42/ Cnly the form in shich these messages «ere turred over chanced during this thirty-year period. Western Union's procedure was far more selective. It insisted from the es delivered. Moreover only messeses to one foreign co.ntry initially were made available to nga. 50/ At an undetermined later date, 211 foreign government telegrams were made available to nsa.ch/ western Union's participation was also of snorter duration. In 1963, estem Union divested itself of its international operations, which were =a:en over by “estern Union Intemational, an inéependent company formed for “hat purpese. Sometime between 1965 and 1972, en NSA Recordak machine located n the ccrpany's New York operations room which company employees used to copy $2/5 foreign goverment ressages, was removed at the company's request. 52/33/ ea
-13- sscormittee has no evidence that, after “orld War Il, the Amny Security *sency -- or, -in 1982, its successor agency, the NSA -- made any attempts to linit its “take to coded messages from the telegraph companies, as was done by snerberl tefGicy's “l°6 Organization after Worid “ar I. Bath code t a=? a 35 ang uncuded Cu -o$szses .:re received and analyzed, seemingly in violation of the 1958 National Council Intelligence Directive (NSCID nuber 6, dated September 15, 1958) setting cut the Functions of the NSA: For the purpose of this directive, the terms ‘'Communi- _cations Intelligence*’’ or “COMINT” shall be ccnstrued to vean technical and intelligence information cerived from foreign communications by other than the intended recipients. CCMINT activities shall be construed to meen those activities «hich produce COMINT by the interception and processing of foreign communications passed by radio, wire, or other electromagnetic means, with specific exception stated below, and by the processing of foreign encrypted ccosmartications, however transmitted. Interception comprises 4 IA a TS tn arch, intercept, and direction finding. Frocessing com- ises range estimation, transmitter operator identification, ignal analysis, traffic analysis, crmptanalysis, decryption, ucy of plain text, the fusion of these processes, and the sorting ef results. : COUNT and COMINT activities as defined herein shall not in- c.uae ia) unencrypte written anv Intercept and processing o Clanaications, press end propaganda broadcasts, or (b) censorsnis. [emphesis added. vas “NSA contends that the specific exclusicn of unencrypted written con- munications, which would appear to prohibit its interception of telegrams, ‘is and zixgys has been limited te mail and communications other than those sent electronically ."32/ Hence, the NSA appears to have interpreted this directive as a certe blenche to intercept and process 2ll foreign commmications, i.e., all these in which at least one terminal is foreign, even though such communications -A were inencrypted. fy-4ay/ Footsote Sunk (p. 13) Former CLA Director Allen Dulles has defined comuunications intelligence as "inforaation which has been gained through successful cryptanalysis of other people's traffic." He has defined cryptanalysis as certain cod and ciphers that can be the mathematical analysis of intercepted traffic (4Ven Bulles, The Craft of Intelligence, Harper & Row, 1963; p. 73). Dulles* chs aracicrization of COMMMT excludes pioccantectxueszzgrax the utilization of plain-text messages. 7
' -]4- o Cporatien SHY mK, the code name under which the cable companies made post ci their international teleccsmunications traffic available to the NSA, anc tc a lesser extent to the FBI, was terminated by the Secretary of Defense an Vay fyrS ++ 2 aate enineiaing witn tne unuren Lommirteets sirse comanstration Gf Letsrest in the pregram. The ‘take’ from Co crazica SHAMROCK -- plus from 3A cperetions -- was used by the NSA in the 1540s and carly 1970s to cerzile files cn American citizens. NSA maintained a ‘watch-list" of names of inziviluals and organizations against which the "take" was sorted, MINSRET was the code name applied to the \Sa's efforts to protect its watch-list activities on American citizens from discicsure. The watch-list Cut Ur BWA laine ow had actealiy begun in the early sixties were not erplied until 1969.25/ The MINC2ET charter described the watch-list program as involving "communications concerning individuals or organizations involved in civil disturbances, anti-war movernents/demonstrations and military deserters involved in anti-var movements .20/ MINwfar wes considered so sensitive that informeticn being disseminated was Cizssilied TCP SECZET and labeled ‘Eacksround Use Criy," and while handled as SITINT and distributed ite SIGINT recipients,— it vas specifically not identified hee st may CS as §8/'59/ 4 cwve . ; as faxing any NSA connection.—'—" On May 12, 127€, material collected under the NSA vatch-List program was transferred to the ciflce of the Principal Deputy Assistant 60/ Secretary of Defense for Intelligence, Thomas K. Latiner, for safekeeping.— The (ANsRET files renain, as of March 1, 1977, in a safe in Mr. Latimer's office, retained pending a request for their production in @ civil litigation. OL/ A280 utilizing the telecommunications intercepted under Operation SHAMROCK, the “Bats OfZice of Security maintained approximately 75,000 files on American Citizens between 1952 and 1974, 22/ These files were epparently created from infor- Matien obtained through SHAMROCK and NSA's other intercept programs. Persons included in these files included civil rights leaders, antivar activists, and Members of Congress. For at least 135 years, CIA employees were given unrestricted access to these Ziles, and one or more worked full time retrieving information that presumably wes contributed to the CIA's Cperation CHA05, which existed from 1967 to 1974. The Comittee does not know to which component of the CLA the NSA's Office of Security _ files on tmerican civilians were transferred prior to 1967, nor by what authority these transfers were made. The Committee is disturted by the CLA'’s apparently receiving information on Anerican citizens on an estz>lished and regular basis, x Se.ir2l years prior to the heretofore believed coms. renent date of that Agencr's detestic surveillance activities. According to the ‘5A, its Office of Security
-1S- while the Committee has no reason to believe SIiMROCK continues today, i.e., that the NSA, or its representatives, is involved in hand-to-hand acquisition of international teleco=munications, the Committee cannot report that the NSA ng tanger intercenls sucn mess2ges sy electronic Tsans. Indeed, ene can argue thet if it vere not, it wruld not be doing its jcb of intercepting foreign povern- meat telece-runications. The NSA has -- and has had for several years -- the technical capability and resources to accowplish this task without the knowledge or complicity of the cable companies :0°3/ thus, from the NSA's point of view, a progran such as SHAMROCK is no longer an operational necessity. (II. Legality - Britt insert] 64a/ See, Zor exanple, testimony of William Colby, "Central Intelligence Agency xe-Diicn in the Privacy Act of 1974" hearings, Kouse Subcermittee on Government Informetion end Individual. Rights, Jume 25, 1975 (pp. 223-24).
. eranne Svarrere es “os I]. The Legality of $74" * c-2 Teurtn Asendsent toe the Constitution Qucrentees to tre people the rizte 10 -2 s¢ieet...in their pazérs.. «Ge r.t unmrzesonatle searches and ertr sae "Tt fucthar neayides that “nan Warrants shall accsa hit enag r oe 2 Ti.lt. “+3 fit that NSA, and its predecessors, inciscriminetely obtained without. a .ircest tizies of virtually every international telegrem leaving the United Steres fcr a period of thirty years would appear to violate this conaituticnal guarentee of privacy. The Supreme Court has held consistently that cificiz] searches may violate the Fourth Amendment if they are not rezscciti, Titited to the accomplishment of some ‘egitimate ccvernmental purrose. 69 Even assuming the collection of foreign intelligence to be a Jecitivate covernnental purpose, the fact the RSA did not limit its interceptions ee zgrecs of foreign governments, or even to those which were relevant to firsign intelligence requirements, but rather intercested a1] international te eicirs rejercless of their source or subject metter, suggests this Cones te tiaras standard was violated. tee f+cteeresticn of international telegrams also eppears to have viciet2e¢ section $05 of the Communications Act, enacted eleven years prior to the corrancenent of SHAMROCK, although this point has never been the suziect of a judicial determination. As set forth al page » supra, that seciice reitizites employees of common carriers, 2S well es eny other person nei teing eutrorized by the sender", from intercepting and divulging the contents of teiecrams, except in certain specified situations. The exception here allowed for publication “on demand of other lawful authority." Hoae.ir, r2 ccurt decision prior to the start of SHAMROCK had interpreted In cectituter, no federal intelligence agency had ever been cesignated by 67 sor did the
it is, furthermore, important to note that the international telegraph companies which participated in SHAMROCK did not themselves interpret the "Uther Tealul cullor ity” cacaptign tu sestiun GO5 68 Teual just ification for wtsic sarticipation.©? To the contrary, they informally sought to have section £75 emended to permit, as a matter of law, the actions which they were teing esxed to undertake by the government. ”° Trey egreed to participate in SRe-M2SCK, nonetheless, upon the assurances of the Attorney General and the Presicent that they sould not be prosecuted under the provisions of secticn 605.7! Whether these high-level assurances would satisfy the legal resuirenent of section 605, i.e., would constitute “demands of other lawful authority", has never been the subject of a judicial determination. Section 605 essentially remained in its original form until 1968, when it wes amended to read in pertinent part: "Except as authcrized by chapter 119, title 18, no person receiving, assisting in receiving, transmitting, or assisticg in transmitting, any interstate or foreign conmmunicetion by wire or redio shall divulge or publish the existence, contents, substance purport, erfect, or meaning thereof, except through éutncrized channels of transmission or reception...on demand of cther lawful euthority. No person not being authorized ty tre sender shall intercept any radio ccom-snicetion and Givuige or publish the existence, contents, substance, purport, effect, or meaning of such intercepted communication to any terson... (emphasis added)” Chapter 119 of title 18, cited in this sect ion, provided in pertinent rt: “Nothine contained in this chapter or in section 605 of the Communications S reer ow Pp Act of 1934...shall] limit the constitutional power of the President...to obtain re foreign intelligence information deemed essential for the security of the United States. "72 tstensibly, this language seems intended to remcve any doubts that comaunications companies, or NSA, might have with ressect to whether a program such as SHA%ROCK might constitute a violation of section 605. But if this was the esparent purpose of the 1968 amendments, it remained unclear whether they hed this legal effect. In the well-known Keith case, for example, decided in 1972, the Supreme Court considered the lenouage in chapter 1139, gucted ebsve, and found that it "confers no power", but instead" merely provides thet tre e¢ct shall not be interpreted to limit or disturb such power as the Fresitect 7ay Fave uncer the Constitution. "73 So if chapter 119 of titie 18
cig cot euthorize the President to do anything, as the Court suggests, one 1g left to ponder the meaning of the language found in the amended version ef etemiem eys mIeN Says Recepl 28 oublerived oy Lnabige 15, Lilie ticecn companies shall not disclose tsiei7e7s in their possession ‘avcrisis eaded).@ Tnis epcarent incongruity between the dicte in the Keith case and the stetutory languege in the amended section 605 res not teen resolved by the S.zrere Court. In United States v. Butenko, a 1974 case, however, the Court of *ppeals for the Third Circuit, without ettempting to reconcile the teo, eppecred to resolve the issue of 605's applicability in favor of the intelligence community by holding: "Section 605 of the Communications Act o ‘ ’ ee ia mm = in a fa) mp 4 cr ~ fe] “y o bee sn . anile the Sutenko c2se involved interceots of telezhone conversations in the ceorse of a wiretap which was exclusively and undisputedly undertaken for frreiin intelligence purposes, the court's conclusions with respect to the legal effects of section 6C5 appear broad encugh to insulate foreign intellicence-gathering procedures of all types from prosecutions under : section 605. ’° 25 fer-reaching as the Butenko lanquece seéms to be, even that qa c ce decision indicates that section 605 may have continued vitality vis-a-vis the activities of intelligence agencies to the extent that such activities ace ccderceken for other than foreign intelligence purpases. The Butenko Clurt stezed its conctusion in the following manner: "The surveillances at izs.e mere were conducted solely for the purpose of gathering foreign jigerce. Therefore, section 605 does not render them, in and cQ of tre-selves,...unlawful."
"4 ~d- Tt wowied se7c2r, the), thet the amended version of section 605, even when read in light of the broad holding in Butenko, would prohibit the sort of activity «nich took place under SHAMROCK. By NSA’s own account, it used information gleened from the SHAMROCK "“take"--froa the early 1960's until 1973--for law enforcement and internal security surposes, and not solely fcr foreign intelligence purposes. 78 Virtually al] overseas cables of Acericans were read during this period, not simply those which had obvious foreign intelligence value./9 Two of the telegraph companies, for their pert, turned over everything to NSA, making no effort to select messages which could reasonably be expected to contain infcraation of foreign intelligence value.80 Thus, even under the Butenko standard, it is apparent “that section 605 would have still presented a sertous legal difficulty to SHAMROCK, had the program continued to operate as it had until 1973.
“ye . PART II QURRENT NSA OPERATIONS vw . NSA has never fully explained to the public ho. it operates, and,civen_the pawre of iss work, perhaps it czonut do so. Enough nas appeared on ihe pudiic record, however, and been conveyed to this Comnittee, to indicate what its functions are end how it carries them out. Such disclosures have also indicated the potential winch 3A 5 rssesses to violate the privacy of indiviczals on an immense scale. The following discussion focusses upon several such apparent problem areas. The 'Vacuuwns Cleaner” Method “TNSA'S work necessarily brings it in possession of the private communications of Avericans. This is so because in order for KSA to monitor international lines of comunicetions for foreign intelligence NSA must intercept all communications transmitted over such links. Former NSA Director Lew Allen, Jr., explained the | problem shich this presents to, NSA to the Church Cosmittee: - "fT]t necessarily occurs that some circuits shich are known to carry foreign communications necessary for fcreign intelli- gence will also carry personal communicaticns between U.S. citizens, one of whom is at a foreign location. The interceptien of com- rianications, however it may occur, is conducted in such a manner ’ as tc minimize the unwanted messages. Nevertheless, many unwanted cormenications are potentialiy avai.able for selection. Subsequent rrocessing, sorting and selecting for analysis, is conducted in accordance with strict procedures to insure immediate and, where possible, autematic rejection of inappropriate messages. The analysis and reporting is accomplished only for those messages ‘hich meet specified conditions and requirements for foreign intelligence.'§/ Cenerel Allen's statement, apparently made te assure the Church Committee and or vicletion of personal privacy which tH the zublic, indicates the enormous potential Gea = NSA nossessess oe . . ~~ . . . = ° First, it suggests that,NSA is able to monitor virtually every international ‘elecormunicaticn entering or leaving the United States. At present, some 24 million telegrams and 50 million telex (teletype) messages enter, leave, and transit the . ? : : “oe 3 ap tes Srates annually ,2/ and most of these are sent or received by private citizens. 2! twat Coonpoter dale Srectmissieds add Oiliees 0F words avde vumbes tle chrecesally ever omy Qed feassey Fh, Cometry sank yer “liicns of additional messages are transmitted over leased Lines, , hen ternational telechone calls are eeusidorsdas yet another potentiai source of intelligence, Secerdiy, it is apparent from General Allen's statement that NSA, in the course of its inteliigence-gathering, obtains access to virtually all types of fem ctier, St's Vear’t ig attuned not simply io ~essages with political and
silitery Significance, =ut to messages concerned +.ith’ financial and economic elfairs, agriculture] matters, cultural and socia] affairs, as well as purely | personal affairs. The information which iSA makes use of, therefore, is not ibnited by the nature of the information it accuires. Finally, General Allen's statement describes in general tems, NSA's cipability to select those messages which it decizes meet its foreign intelli- gence criteria. , Elaborating further on this cezability, Allen noted: "{t]he use of lists of words, including individual nares, subjects, locations, etc., kas long been one of the methods used to sort out information of foreign intelli- _ gence value frem that which is not of interest." Presumably, therefore, NSA's selection process might be applied to sort out the communications of a particular government, a particular company, or a particular individual. NSA could presumably select a message going to or from such target or one which simply mentioned it. NSA could also presumably select communications about a particular subject, such @s plutonimm or oil. , . , In shert, NSA possesses ar: extraordinary capability to intercept and make intelligitle electronic signals which carry conscunications. No other agency of the : sos : BY-A federal govermoent undertakes such activity on such an immense scale. 1 A/ Tergeting for ‘Foreign Intelligence" Requirements General Allen's statement to the Church Committee alluded to the fact that NSA selects ressages on the basis of "foreign intelligence” requirements supplied : : : : : > ete : rs in the U.S. intelligence community. 2/ What may constitute "foreign w y its consut er aw intelligence’, however, is far from clear. As the Church Conmittee points out: "'Foreign intelligence’ is an ambiguous term. Its meaning changes, depending upon the prevailing needs and views of policsmaxers, and the current world situation. The internal politics of a nation can also play a role in setting require- ments for foreign intelligence, the domestic econcmic situation, an upicring political campaign, and intermei unrest can all affect the kine of foreign intelligence thet a political leader esires. Thus, the cefinition constantly expands and contracts to satisfy the changing needs of Americen policymakers for to Indeed, “SA's monitoring the international cc~mumications of U.S. citizens involved in entixar activities in the late 196Cs wes considered to have been part of the asency’s “foreign intelligence” mission’! NSA claims that it no longer targets U.S. citizens by name for any purpose? §/ but it concedes that this limitation : . - Q : - 1s a matter of self-restraint, rather than one cz law2/or practicality.30/
. , ‘ ~3- % Apart fren even this sort of blatantly improper intrusion, however, it is not difficult to sce how a broad range of activity carried out with foreign entities by Arerican citizens, especially activities of an eccnomic and financial’. -- netere, could be of “foreign iatelligcnce”™ interest, and, thus, Sc "lair gamer “ It ray te of "foreign intelligence” interest, for cxample, to know what is being said bec.zen U.S. banks and their large Middle Eastern depositors, whose . toa Toe aczions could heve a substantial inpact on the U.S. economy.” It may be of "foreign intellisence" interest to know the details of oil transactions between U.S. importers and their foreign suppliers, of commodities sales with foreign gc.erments, of negotiations regarding the purchase of cquipment or services from American concerns, of the location and quantity of various raw materials, or the location of influential U.S. businessmen traveling in foreign countries, or of what is being said about or to members or employees of the U.S. government. 40-8 / Thus, while an American citizen or company might not be targeted by name, by virtue of his international activities, his ccmmunications might be selected byes’ on the basis of its “foreign intelligence” criteria. eXSA hes not denied thet it, in fact, “selects” U.S. messages of this néture; and, indeed, several uncorroborated reports have reached this Committee indicating that such monitoring is tresently underway." ‘Sat? Cermunications Security (comsec) lees a, eee In edditicn te its foreign intelligence mission, NSA is charged with the . i sritection end security cf U.S. government comnunicetion A2/ NSA carries out this function primarily by developing codes and encryption devices to ensure that geverncental cemcunications cannot be read by foreign intelligence-gathering agencies. Recentiy, “ceever, press reports have stated thatySA has carried out its corm nications security function by monitoring purely domestic conmunications li-is to detercine what information, if any, is being gleaned from Anerican com- murizstions by Soviet intercepts within the United States. 22/ NSA has not publicly denied these reports, nor has it sought to explain them 32/ Wrer. asheé about such reports, the current NSA Director, Vice Admiral Bobby R. Imaan, oniy sepeated, 54's clain that “no U.S. citizen is now targeted by the NSA in the hited States cor ebroad” 22! As heretofore noted, nonever, the fact that NSA does Soes not necessarily mean that NSA does not inter- £ U.S. citizens tc carry cut its work. Lf
= INSERT © PAGE 22 NSA representatives have repeatedly given the Committee informal oral assurances that internal NSA directives exist to prevent the misuse of inter- cepted telecommunications that are not "foreign-intelligence” related. seesooess Gen. Allen nds leciared: “The executive directives applying to these efforts state: (a) The purpose of the signals intelligence activities of the National Security Agency 1s to obtain foreign intelligence from foreign commmications or foreign electronic signals. (b) Foreign communications exclude communications between or among citizens or entities.” S1-a/ Unfortunately, these statements shed little light on what the NSA actually Goes with comcunications of American citizens which it might acquire. PXXRA®KX BR Y.C TG any related internal NSA guidelines, no matter how tightly drawn they 2 tay be to prevent potential abuses, are so closely held that any violations will likely be GMl@uwmb undetected by Congress or any other authority outside the NSA, since the only persons having access to these guidelines outside he NSA are a selected group within the Executive Branch and a handful of "need- toeknow” Members and staff within the Congress, all of whose sree to information is based on the condition they will not disclose it. KMéseskaészx briefings on tigh-priority or potentially emtarrassing intelligence matters by federal intelligence matters given to these "need-to-know” individuals in Congress, are often vegue and incomplete. 2222/ Bowes it 4s virtually impossitle for selected members of the any person cr Agency outside/inteLlagence community to ascertain if the guide- lines are, in practice, actually folloved. The guidelines, therefore, being vept very secret, offer little assurance tothe American people. Not only are they unkzown, but no public evalustion of their effectiveness is presently persitted. In practice, the “system” is ultimately based on the rule of very few men and not on the rule of lav.
Gos.cstic cosmunications are being perused by KSA with the idea of discover ing what the Soviets are able to obtain {rom U.S. comsunicetions, NSA's communications erognet cculs conccivably be of manmoth proportions, : . = Gud tiation Secrecy ao To understand, NSA's reluctance to provide greater public explanation of the manner in which it intercepts and handles U.S. commmications, one must urcerstand the uncczmon secrecy which has traditionally enshrovded its existence and functions. The Agency was created by classified Executive order in 1952, and its functicns were assigned by classified Executive directives thereafter. Prior to 1962, its existence was not acknowledged: in the U.S. Government Manual. It was not until 1975, twenty-three years after its creation, that any Director of the agency ever eppeared before a congressional committee in public session. wv NSA has furthermore refused to provide evidence in judicial proceedings on the grounds that such public disclosures covld lead to a compromise of its “sources and methods". .The Church Conmittee reported that at least one criminal te presécution «as drepped by the Justice Department because of, NSA's refusal to discuss such intercepts in a public forum, 16/ Attomey General Levi admitted to the Church Cermittee that even he was not: privileged to NSA's secrets: “attomey General Levi: ... [A]t this time I would have to say that I do not know what [NSA’s] procedures are. I do not Inow what the possibilities are. I do not know enough about the minimization procedures {for the interception and use of U.S. communications} ... "Senator Church: unk you have that information, you really do not have the foggiest idea of whether what they [NSA] are doing 38 legal or illegal, constitutional or unconstitutional? “attorney General Levi: I would be glad to accept the pro- tective shape ot that proposed answer. I suppose I have a foggy idea. “17/ It has feneris been this Committee's experience during its independent ow investigation of the SH°ROCK program, that even after the Church Committee had released its public report exposing in great detail the nature of the program, @& NSA sieadfastly refused io declassify any of the documents regarding the program for requested purposes of this Committee's work. at aN a — RESTRICTIONS UPON,NSA'S CURRENT OPERATIONS rAn NSA contends that, since it is concerned solely with gathering “foreign intelligence’, neither the restrictions contained in the wiretap statute (18 U.S.C.
COMSEC is also involved in another area of written teleconsusications of ".S. sifizens that ere not national security related, through the resentiy adonte] Data Encryption Standard. Data telecommunications, iiks telepaone stzsunicatious, san be fatere>pted and read. To protect the integrity of these communications, the Secretary of Commerce, on November 23, 1976, epproved mEewemepne the Data Eccryption Standard established by the National Prreaa of Standards, which had been largely developed through Sam with the assistance of the @% NSA. In this standard, messages to be transmitted can be encrypted into 56 binary digits ("bits"), and decrypted by the recipient. However, many critics of this standard maigtain that the 56 bit level allows the NSA to penetrate it, and circumstantial evidence developed suggests that prior to the NSA's involvement, the standard being wnemeium by TSM was set at a mich higher leve1.9974 $5-A. See, for example, a November 18, 1976 Bell Laboratories memorandun (copy in subcommittee files), which characterizes the Data Encryption Standard as having “little safety margin” and urges that it be strengthened to 6h or 128 bits. This memorandum also notes that a 1971 IBM publication describes the Data Encryption Standard's planned, but never implemented, predecessar as utilizing 128 bits. The senior official of a giant U.S. multinational finenciel institucioa, eited in 2ootne.e G2-A, onin2d that .is company is only concerned with doterception by private entities, and it protects 1tsel’ frou tais threat by encrypting its telecommzunications at a level which makes it insecessihie to non-governmental third parties, bat not inaccessible to the NSA, \pemmpeapeprweStip, he added, bes not made a higher encryption operational because vt would "run into a political morass with the Office of Munitions Control” in Washington? mesmnnspenninieseereeemee td An official of the State Department's Office of Musitions Control - which works in tandem with the Department of Defense - has advised the subcommittee that for export use, “anything above 56 bits you have to come to us,” adding that one large U.S. corporation wants to use more bits in several overseas situations and in some cases ve are going to @rant perzission.” (Telephone interview WERE with Mr. Clyde ‘Brant, Jasuary 5, 1977). ; sell as Tost “wperable isinesses,
INSERT "2" = P. 23 The NSA has maintained this position, notwithstanding its Operation SHAMROCK represented an invasion of privacy of American citizens vastly greater than any known FBI or CIA mail intercept programs, and its watch dist activities viseaevis American citizens were deemed by former Attorney General Elliot Richardson to raise “a number of serious legel questions which have yet to be resolved. "97-A (Was Fink FN 85): Tre NSA continues to function under a mantle of secrecy. It has not explained, and presumably does not intend to explain, tself to the American people. It simply asks the public and the Congress to “trast us." The Committee does not believe that such trust is justified, and finds it regrettable that a shroud of secrecy, as tightly drawn es ever, continues to envelcp all the activities of the NSA. The Cocmittee further believes that even if the NSA aia not pose a significant threat to the privacy of American citizens, and if it had not abused its powers in this regard, that puch of the secrecy surrounding its operations is obsessive and unfounded. The fact that it does pose a significant threat to the privacy of American citizens, and has a record of violating it for mare than thirty years, strengthens the Committee's belief that the NSA should explain to the public what it does with its intercepted telecommnications, and should become publicly accountable for its activities that effect Americans. The Coomittee finds that mich of the basis for this secrecy is historical habit, in which inteiLigence agencies traditionally attempt to keep everything - even, vheo possible, their very existence - hidden. sO™ penne ees Tne NSA has vigorously fought disclosures which, in the Committee's view, will not endanger the national security. Thought the NSA acknowledges that it monitors telecommnications of “foreign intelligence interest," and it is a@eneraily accepted in diplomatic and intelligence circles that the Agency monitor:
TNSERT "3" - P. 23 (cont'd) the telecommunications of most foreign governments, the NSA, strongly reinforced by the White House and the Defense and Justice Departments, considers it unthinkable, for example, to identify even by categroies, countries in which it has an intelligence interest 93 This attitude is maintained even though Herbert Yardley had, in 1931, listed 21 countries, including some of our closest allies, whose codes were breaking 50 years ago, in peace time. Foreign governments today can hardly believe the NSA is currently doing any less, in view of the Cold War and the ease with which modern technology allows the NSA and counterpart organizations of other goverczents - to acquire message traffic. 97-3 C7-R Several knovledgeable sources have advise? the Cecmitves that tne HSA, #aile acle co collect virtually 211 telecommunicatios, as a practicel matter is unable @to read the sensitive traffic of developed nations. This results fran sdvances in coxsputer technology, which have enabled the codehakers to outstrip the codebreakers. This position was publicly expressed by David KAbo, in the New York Times, We June 22, 1973:
: Ww" - . -S- Insofar as the interception and use of the communications of U.S. citizens a rz concerned pA is restricted only by 126 sified guidelines established by the a 2 tc mey General in 1975. These guidelines have never been made public nor criicially released in sanitized form. While they have been aljuded to in varicus parlic cements of agency officials, 49/ and in a report made to this Conmittee ty the General Accounting office! 20/ these corments regarding the guidelines have 2:0, general and have not explained how NSA systematically selects and treats the Ci-runications of U.S. citizens and businesses. acho, for example, reported to the Cismittee chateisa "takes great pains to remove the identity of a U.S. person from foreizn intelligence report", but in the course of sampling such reports, en: et G33 auditors found "three instances in which the mention of equipment might identify ig thet NSA Zeletes the names of U.S. citizens from communications which it uses to 2 U.S. menufacturer to a knowledgeable person", 24. 2y/ G0 Suggests, on the one hand, A cr-sile its foreign intelligence reports, but that it leaves intact certain infor- rztien from which identification of such citizens could be made. CONCLUSIONS At the cutset, this Committee realizes that the newly-created intelli- garce oversight comnittees of the Congress have primary jurisdiction over the foreign intelligence activities of JNSA. The Committee is equally aware that it may not “sve sufficient information in its possession regarding these activities to make -Zormed judgments regarding the controls that should be placed upon SA. Never- theless, in the course of this Committee's investigation of the telegram inter- certion ‘pregram, in the work of the Church Cocmittee, and in what has appeared eise.here on the public record, it hes become apparent that the activities of Sd NEA Lave had, and probably continue to have, an adverse impact upon the rights acti rrivecy of American citizens. This does concern the Committee. Aaincg ugh NSA no longer sends its messengers to the offices of international sh carriers in the early hours of the mcming, as it did while SHAROCK eraticnal, it nevertheless intercepts internaticnal ccermimications just as v and just as indiscriminately. In fact, the international conmunications -zricans are presumably being intercepted today in a significantly greater te wtiuve then wes ever available under SHAMROCK. ‘ioreover, the ability of NSA to firt such great veluces of material has undoubtedly improved with advances in
. ~6- fe SA concedes that it must unavoidably acquire many conmunications of s-erican citizens but it will not say what it coes with those communications. ty “SA further concedes that some of the communications of American citizens. way ve OF "Sereign iutelligence™ valve but it will not say what : ‘ = does with these rary corr aications. fw MSA also says that it intercepts only cc-ttunications which have one foreign terminal, Sut it does not explain or deny press reports that it monitors domestic jong-distance calls to determine what the Soviets obtain from U.S. domestic com- munications. — \. MSA says that it operates under strict guidelines established by the ttemey Cineral but it refuses to say what those guidelines are and refuses to ad a make a public assessment of their effectiveness. All of this leaves the public to wonder if their comm-nicaticns are being Silently intercepted and used by the government without their knowledge. Apart frem a Amd¢erental concern for the privacy of one's communications, these practices wmavcicarly tring other possibilities to mind. Cculd the goverment be using infermaticn gleened from such commmications to influence or disrupt international Susiness transactions? Could it provide KSA or Executive branch employees with ‘insider’ information regarding investments or information which might otherwise sive thes a competitive advantage in some eccnomic venture? Could such information be used to ‘biacknail’ or threaten sane individual or business? Could this infor- mation be turned over to a federal agency, such as the Securities and Exchange Cr-—issicn or Commerce Department, in pursuit of its administrative responsibilities? ould inforration which suggested that a crime had taken place or was about to take place be timned over to a law enforcement agency? Would information relating to a rotentiel civil disturbance or forthcoming political rally be turned over? Would infercatien regarding the future of certain legisiation be passed on to the ap- rrcrriate federal agency? Wovld information «nich suggested some person may be a security risk be turned over to the appropriate federal agency? Could infor- sation uncer any circumstances be turned over to 42 private employer? Could such ticn ever be used to deny a federal benefit? It ig the opinion of the Committee that, notwithstanding the important and a eersitive »ork undertaken by, NSA, democratic gcvernment demands greater public ts - for an agency with the potential «nich NSA has to violate the
. . -7- Fad rights ¢f 4rerican citizens. At the very least, "sa shculd make public the Atrcrrey General's guidelines which eovern its acquisiticn and handling of the comucnications of U.S. citizens, and should open such restrictions to the invigorating effects of public debate. If the guicelines as they are now written carrot be disclosed because of the intelligence methods which they might reveal, the Committee encourages that they te released in a form which does uot ccrpremise such techniques. Cver the long term, the Conmittee concludes that Congress should adopt statutory ccntrols to govern the activities of NSA, at least insofar as they impact upor. the communications of American citizens. At present,,NSA contends éws governing wiretapping and radio intercepticns are not applicable to o-" that bm its operations. It has no statutory charter, nor is its director even subject to cenfirmetion by the Senate. To this point at least, even the recently-created congzessionel oversight committees have provided the public with no greater insight. In view of the Agency's, conSicerable potential for violations of the privacy of *cericans, however, and the dovodts already cast upon the legitimacy of its current practices, the Committee concludes chat sats limited accountability does not serve the public's interest. Neither the Cengress nor the public can carry. out their constitutional responsibilities in a vacinm. Both need information. when the activities of an Executive egency come into apparent conflict with the rights end privacy of the individual, it is essential to good government that the public be informed ef the nature and extent of that conflict. We should not be left du ry to .¢rder whether we are abiding the activities oi SA at the expense of the Constitution.
i/ FOOTNOTES -j- i/ _ Tne House Select Committee on Intelligence (hereafter cited as Pike Com- mittee) noted that the total annual intelligence commmity budget wes “more than $10 bitlion;" that the NSA “has one of the largest budgets in the intelligence commmity;" that "roughly 20 percent of the National Security Agency's budget is not added into the intelligence budget;" that "the costs given Congress for military intelligence {much of which would be applicable to NSA's functions] do not include expenditures for tactical military intelligence, which would approximately double intelligence budgets for the three military services." (Pike Committee Report, Village Voice, February 16, 1976, p. 72.) This appears to conflict with a CIA briefing given to President-elect Jimmy Carter, ‘ that "the military branches of the intelligence commmity receive more than 80 percent of the roughly $4 billion budgeted annually for all United States intelligence efforts, principally for the photo reconnaissance and radio signals interception technology used to monitor potential adversaries." (David Binder, ‘U.S. Intelligence Officials Apprehensive of New Shake-Ups Under Carter," New York Times, December 13, 1976, p. 43. Emphasis added.) — 2/ David Kahn, author of The Codebreakers, “a. definitive work on cryptology, describes the NSA as "the largest and most secretive of all American intelli- . gence organs," and estimates that on its own it "spends about $1 billion a year." But, he adds, "the agency also disposes of about 80,000 servicemen and civilians around the world, who serve in the cryptologic agencies of the Army, Navy, and Air Force [that] stand under NSA control, and if these agencies and other col- lateral costs are included, the total spent could well amount to $15 billion.” (Source: David Kahn, "Big Ear of Big Brother", New York Times Magazine, May 16, 1976.) Tad Szule describes NSA as "the largest, most important, most expensive, and secret member of America's ‘intelligence commmity,'" which "costs over $10 billion a year and employs some 120,002 persons around the world." Ac- cording to Szuic, "a vast array of specialized military agencies such as the ASA (Amy Security Agency}, the USAFSS (United States Air Force Security Service), and the NSG (Naval Security Group) . . . account for the vast majority of the NSA's military and civilian employees." Approximately 90 percent work abroad. (Tad Szulc, ''The NSA - America's $10 Billion Frankenstein", Penthouse, November 1975.) 3/ ‘Meet the Press" interview, August 17, 1975. ‘4/ See footnote 2. 5/ For "Conmmmmications Intelligence’ and "Commmications Intelligence Activities" official definitions, see p. s-af . 6/ Frank Van Riper, "Find U.S. Agents Spy on Embassies’ Cables," New York Daily News, July 22, 1975, p. 2 7/ Subcommittee Hearings, pp. 2-3. 8/ Id., p. 62. $/ Church Committee Hearings, Vol. 5, pp. 57-60. 10/ Subsequently amended to 1945 (see p.). 11/ Subcommittee Hearings, p. 56. 12/ Id., pp. 58-59. 13/ 14/ 15/ id., p. 99. Id., pp. 125-26. Id., p. 240, et seq.
16/ Arcy Security Agency, Historical Background of tte Signal Security A enc ,, Vol. III, p. 74; prepared under the Direction of the Assistant ChieF of Seste S-2, April 22, 1946. / I. 18/ David Kahn, The Codebreakers (New York, The Macmillan Company, 1967), p. 344. 19/ Herbert 0. Yardley, The American Black Chanber {Indianapolis, The Bobbs- Nerrill Company, 1931), p. 240. 20/ Arzy Security Agency, op. cit., p. 48: "In order to conceal the true nature of its activity, the office was called ‘Code Compilation Company’, a cover name for MI-8 but the real name of an incorporated business firm established by Yardley and Charles J. Mendelsohn, partners in this venture. This firm produced and sold in fairly large quantity, a code called the Universal Trade Code." 21/ Yardley, op cit., p. 370. 22/ Quoted in Kahn, op. cit., p. 360m. (In this regard, Secretary Stimson also rade his well-known declaration, "Gentlemen do not read each other's mail."') 23/ Yardley, op. cit., p. 332. (This forty-five year old list is not dis- Similar to one possessed by Western Union International which, when subpenaed by this Comnittee on February 4, 1976, prompted President Ford to attempt to extend the so-called “executive privilege" doctrine to a private corporation. See p. below.) , 24/ Id. 25/ Yardley, op. cit., pp. 240-41. : ee 26/ Copy in possession of subcommittee. 27/ Postal Telegraph, the holding company controlling Commercial Cable, merged with Western Union in 1943. (O£ the three U.S. companies now dominating the international telegraph business in and out of this country -- ITT World Commmni- cations, RCA Global Commmications, and Western Union International, an independent spin-of= of Western Union -- two were only minimally in the business in the 1920's, and one did not exist.) 28/ Yardley, op. cit., p. 342. ‘, 22/ Arcy Security Agency, op. cit., pp. 73-74. 36/ This section is largely based on Army Security Agency, op. cit., pp. 74-77. 51/ “An act to regulate radio commmication,” August 13, 1912, 62nd Cong., 2d Sess., Ch. 287, Statutes at Large, Vol. 37, Part I, p. 307. 32/ “An act for the regulation of radio commmication,” February 25, 1927. 66th Cong., 2d Sess., Ch. 189, Statutes at Large, Vol. 44, Part II, Sec. 27, p. 1172. / axay Security Agency, op. cit., Pp. 77. vu ut a -/ New York Times, Jume 2, 1931; p. 18. 35/ New York Herald Tribune, June 9, 1931; p.. 36/ New York Times, June 2, 1931; op cit. a 37/ Yardley described his receiving the award, as follows: “In awarding you the D.S.M.," the General began again, "we find it difficult to draft:a citation that will describe your distinguished services, and at the same time keep the nature of your activities secret, for of course all citations are pub- tished. Have you any suggestions?” "TY naturally have never’ given the matter any thought.” £
INSERTS = FOOTNOTES $-4/ "dritten," as interpreted in this report, includes cablegrass, radiograns, telex transuigsions, computer transmissions (such as used by banks for financial transfers}, facsimile and video transnissions, telenetry, and switch and signs] and other non-oral transzissions. 404A/ The Navy also hac fits own erfpologic section. See Kahn, op. cit., pp. 386-85.
-3- 37/  [foomote continued] “Well, we'll draft something, so that your successes will not be revealed. The only regret is that the real reason for confirming the D.S.M. can not be given... .” I was to appear before Secretary of War Weeks at two P.M. to receive the D.S.M. On the way to his office I asked General Heintzelman if Secretary Weeks really knew why I was being “ awarded the D.S.M. He assured me that thé Secretary“waS one ot of the most ardent supporters of the Black Chamber. I felt rather silly standing before the Secretary of War, as he read my citation that seemed to have very little to do with the breaking of codes of foreign governments, but I was relieved when he pinned the medal on my lapel, for with a twinkle in his eye he winked at me. The wink pleased me inmensely. (Yardley, op. cit., pp. 322-23.) 3Y Amay Security Agency, op. cit. p. 177. 3Y New York Times, February 21, 1933, p. 3. sae wey, Primarily from Army Security Agency, op. cit., pp. 176-80. i On8 ee ee eee : Lae we 41/ ITT Commmications is now ITT World Commmications. RCA Commmications is now RCA Global Commmications. In 1963, Western Union's international operations : -- were transferred to Western Union International, which was established as an indepencent company. Between 1971-1974, these three companies carried 94.9 percent of all international telegraph messages in and out of the U.S. (Source: FCC letter to subcommittee, January 28, 1976). 42/In March 1976, when representatives of the three major American telegraph companies engaged in international commmications testified before the sub- committee, the subcommittee believed that the government had not commenced its ~ post World War II interception of private messages until 1947. This belief was based on_a report issued by the Church Committee on November 6, 1975, at which \ time Sen- Church stated: N At meetings with Secretary of Defense James Forrestal in 1947, representatives of the three companies were assured that if they cooperated with the Govermment in this progran, they would suffer no criminal liability and no public exposure, at least as long as the current administration was in office. They were told that such participation wes in the highest interests of national security. Shortly after the subcommittee's March 1976 hearings, a subcommittee staff inquiry . led to records being uncovered in the Archives which indicated that the Amy . Security Agency had, in fact, taken steps to initiate the interception program 2S soon as the war ended. Prior to making these records available to the sub- comaittee, Archives sought Department of Defense permission; that permission was refused. The Department of Defense then advised the Church Committee of the existence of these documents, and allowed a staff member of —_ that committee to inspect (but hot copy) them. ‘This transpired just prior to the issuance, in Msy 1976, of the Church Committee staff 1 report on "National Security Agency Surveillance Affecting Americans," which _. “aS_amended accordingly. 43/ Letter from Intelligence Officer of Arny Signal Security Agency to Com-__ tanding General, August 24, 1945, quoted in Church Committee Final Report, \ Book III, pp. 767-68. ie - se oy - 43/0 Id., p. 769. 45/ Subcommittee Hearings, p. 212. 4se/ Id.
~§- 47/ Mr. Sparks, who was the most forthright of all Lelegraph compa.y witnesses, testified that within RCA he was the sole authority for ing al] messages available to government agents, and that this arrangement began in 1947. The Committee has no reason to doubt the accuracy of Mr. Spark's testimony inso- | far as he was aware of the facts. The 1947 date, as he recalled it, was pre- sumably a result of that being the program's generally accepted date of commence- ment, at the time of his testimony. His belief that he was responsible for making the arrangements with the government apparently is based on initiatives made to him by Amy Security Agency representatives, subsequent to arrangements unknown to him being made with his superiors. (See October 9, 1945 letter from RCA Vice-President W. H. Barsby to Brig. General W. Preston Corderman, in Sub- ! committee Hearings, p. 208). Mr. Sparks apparently never knew about the 1947 meeting with Secretary Forrestal; Spark's superior, Gen. Harry C. Ingles, then president of RCA Commmications, represented the company. The ITT delegation to the 1947 Forrestal meeting was led by ITT Chairman and President. Sosthenes Behn. Joseph L. Egan, Western Union president, was invited but did not attend, and his company apparently was not represented. 48/—Azxmy Signal Security Agency -letter,;-August-24,- 1945,- op.-cit., p. 772. 49/ For a detailed description of these procedures see Church Committee Final Keport, Book III, pp. 765-776. S0/ .Id., p. 773. 51/ . Subcommittee Hearings, p. 107. 52/. Western Union International's executive vice-president testified he had the machine removed in 1965. However, the Church Committee reported at Book III, Pp. 774: This recollection “was not borne out by documents furnished by NSA. The documents showed that on February 2, 1968, a company vice-president (not the one referred to above) had discovered the existence of NSA's Recordak (microfilm) machine in the Western Union transmission room. The machine was reported to the company president, who directed his employees to find out to whom the machine be- longed . . . . It is clear that NSA continued to receive duplicates of all messages ' to the foreign country referred to above until 1972; when again as a result of ‘discovery’ by company officials, this procedure was halted . .. . In effect, _ Western Union International's participation in SHAMROCK ended by 1972." | On June 7, 1976, Mr. Greenish advised the subcommittee, through Counsel ' ", . ¢ that the practices discussed by him, copying foreign government traffic | on the Recordak, terminated with the removal of the one and only Recordak” ‘about -1965'". (Subcommittee Hearings, p. 111.) 33/ In addition, the Western Union International office in London turned over commmications entrusted to its care to the government of the United Kingdom. On March 3, 1976, Executive Vice President Thomas S. Greenish testified that - his company never made cables available to authorities of any country other than the United States, but he subsequently told the Subcommittee that he "mis- understood Ms. Abzug's question," and his attorney requested that his testimony be changed to show that messages had been turned over to British officials. (See Subcommittee Hearings, pp. 112-13). Mr. Greenish's amended testimony is consistent with a February 21, 1967 report in the London Daily Express, which stated that telegrams sent out of Britain. were regularly available to that country's security authorities; the story noted that international telegrams which passed through foreign companies - operating in Britain "are collected in vans or cars each morning and taken to the Post Office security department." On June 22, 1967, Prime Minister Harold Wilson told Parliament that the practice had been going on since 1927. On May 12, 1976, the British Embassy in Washington refused to state whether the practice continves, formally advising the Subcommittee that "it is not in accordance with HMG's - .* policy to ccnment on such matters." m March 11, 1976, George Knapp, president of ITT World Commmications, testi- fied that to his "persorial knowledge" his company had never made commmications available to any foreign government. (See Subcommittee Hearings, p. 306.) Representatives of RCA Global Commmications were not asked if their company had ever made commmications available to any foreign government. f
"Sue 53/ [footnote continued] The Coamittee does not knew what uses the British g-Veraument makes of the messages wade available to it, nor does it know if the messages are dissemi-- nated to any other governments. The 3ritish government maintains a liaison ‘ oifice at NSA headquarters in Ft. Meade, Maryiand, and the NSA maintains a liaison office at the British government's Ceneral Commmications Headquarters in Cheltenham, 75 miles northwest of London. NSA personnel are also based at Several cther locations in Great Britain. Under the 1947 UK-USA Agreements, the U.S. and the United Kingdom -- as well as Canada, Australia and New Zealand *- routinely exchange information gleaned fron intercepted telecommmications. $4/ Church Comittee Final Report, Book III, p. 737. eu. a tp. 739. 56/ "Establishment of Sensitive SIGINT Operation Project Minaret," dated July 1, 1969, in Church Comittee Hearings, Vol. 5, pp. 149-50. $7/ SIGINT recipients include, but are not linited to, the President's Foreign Intelligence Advisory Board (PFLAB), the Central Intelligence Agency (CIA), the Federal Bureau of Investigation (FBI); the: Defense Intelligence Agency (DIA), the (Amy) Assistant Chief of Staff for Intelligence (ACSI), the Office of Naval Intelligence (ONI), the Air Force Office of Special Investigations (AFOSI), the Energy Research and Development Agency (ERDA) and the Department of State's Office of Current Intelligence. 58/ Church Committee Hearings, Vol. 5, p. 150. 59/ For a detailed discussion of NSA watch-list activities, see Church Comittee Hearings, Vol. 5, pp. 1-55 and 145-163; also Church Committee Final Report, Book III, pp. 737-65. 60/ Letter from Comptroller General of the United States Elmer G. Staats to Chairwoman Bella S. Abzug, November 12, 1976, p. 2. §1/ Subcomnittee staff. telephone interview with Col. Stephen A. Harrick, Office of Assistant Secretary of Defense for Legislative Affairs, March 1, 1977. (The civil litigation is Halkin v. Helms, 75-1773, U.S. District Court, District of Colusbia Circuit). 62/ For a detailed discussion of NSA Office of Security files on American citizens, see Church Comittee Final Report, Book III, pp. 777-78. €3/ Church Comittee Final Report, Book III, p. 778. 6:/ This is not to argue for the continuation of SHAMROCK, or any SHAMROCK surrogat / §3/ Not even a single blanket "vacuum cleaner epproacn” satisfied the appetite IN —s of government monitors, for FBI and NSA "cable drop" operations in Washington partially duplicated and triplicated athe New York SHAMROCK coverage. In these Operations, the FBI physically Gecesced the Washington offices of RCA Global Coccumications and ITT World Conmmications during daylight hours, to examine cable messages, and NSA repeated the operation between 3 and 5 a.m. (See Sub- comaittee Hearings, p. 241; the Committee has 2lso been informally informed that the same persons who made nocturnal visits to RCA similarly visited the Washington otfices of ITT). For sorting messages, the FBI paid RCA employees from 1960 to 1973; starting in 1966 the FBI began withholding 20 percent of these payments for income tax °* purposes. (Ibid, pp. 242-43; the Committee does not know if ITT employees received comparable message-sorting compensation from the FBI). 66/ Pike Committee Hearings, p. 241. _ oe cena te 67/ Mr. Colby's semantic qualifier, "on some occasions,” is not wnilike his “testimony before the subcommittee and others, that the CIA’s 20 year mail s.tercept program (which opened cver 190,000 letters), was among "'the few’ individual instances of the Agency's domestic illegalities. Cf., for example, "Central Intelligence Agency Exemption in the Privacy Act of 1574" hearings, FPouse Subcommittee on Government Information and Individual Rights, March 5, 1973 (p. S) and June 25, 1975 (pp. 139-40). f + ' '
7 6 . A8/ The legal conflict between this general search procedure and the fourth amendment is discussed on p. . 69/ Letter from R. Michael Senkowski, Legal Assistant to the Chairman, é-Federal Conmmications Commission, to Robert Fink, Prefessional Staff Member, Subcommittee on Government Information and Individual Rights, January 28, 1976. 70/ U.S. persons are U.S. citizens, resident aliens in the US., and corporations ” with their principal place of business in the U.S. 7l/ These are headquarters procedures. Apparently, at overseas bases, many messages are also intercepted by human analysts prior to trigger word screening. Chet Flippo, an associate editor of Rolling Stone, reported that he was, in 1967, in the Naval Security Group (the NSA's naval wing), assigned to intercept telecommunica- tions from a desert base in Sidi Yahia, Morocco. In addition to intercepting diplomatic cables, military messages, telegrams, transcripts of transatlantic phone calls, Flippo wrote, “I also screened reams and reams of transatlantic cables to and from the U.S., regardless of whether they contained any key words or names. Telegrams or phone calls involving American congressmen and journalists, ‘dissidents,’ multinational corporations -- were all targets." (Chet Flippo, "Can the Swadents Into Spies?, Rolling Stone, March 11, 1976), -— i 22/ Church Committee Hearings, Vol. S, p. 60. i 73/ Seep. , for a partial list of SIGINT recipients. 4/ Letter from Lt. Gen. Lew Allen, Jr. to Chairman Otis Pike, House Select Committee on Intelligence, August 25, 1975; quoted in Committee's final report as published in Village Voice, February 16, 1976, p. 90. ‘ "Uuet aeal 75/ Ibid, p. 88 [emphasis added). 76/. Attach’ ent to letter from Federal Reserve Chairman Arthur F. Burns to Sen. Frank Church, Chairman of the Subcommittee on Multinational Corporations — of the Committee on Foreign Relations, March 9, 1976. (Copy in subcommittee uv files). The Federal Reserve refused to supply the multinational subcommittee with deposit totals of individual Middle East oil-producing nations, but the Washington Post noted that, in 1975, the government of Kuwait had $1.7 billion on deposit with the Citibank of New York, and in the same year foreign deposits accounted for nearly two-thirds of al] monies deposited in both the Citibank and ~ Chase Manhattan Bank, the nation's second and third largest banks. (Ronald Kessler, "Banks Hold Huge Foreign Deposits: U.S. Examiners Worried About Pressure From Governments," Washinetén Post, January 14, 1976, p. A-1). By June 30, 1976, the deposits of the Maal East oil-exporting countries in U.S. banks reportedly totaled around $19 billion. (Dan Morgan, “Senators, Banks Block Probe of Arab Deposits," Washington Post, October 10, 1976, p. A-1l. Ptihartadachsetmn et — Dosbuntnty t/ Telephone interview, December 14, 1976. 78/The Mutual Security Act of 1954, as amended, establishes ‘controls on "the export” ~~ and import of arms, ammmition, and implements of war, including technical data relating thereto, other than by a United States government agency." Category XIII, “Auxiliary-Military Equipment," subsection (b) includes: as Speech scramblers, privacy devices, cryptographic devices (encoding and decoding), and specifically designed components therefor, ancillary equipment, and especially devised pro- tective apparatus for such devices, components and equipment. (Source: International Traffic in Arms Regulations, Depart- ment of State; February 1976, p. 5). The Act is administered by the State Department's Office of Munitions Control, - assisted by the Department of Defense, which grants (and withholds) export licenses. On November 23, 1976, the Secretary of Commerce signed a Data Encryption Standard developed by the National Bureau of Standards, assisted by the National Security Agency. Many critics of this standard maintain it is set at a level (56 binary digits, or "bits") which allows the NSA and, in time, very large corporations, to penetrate it. A November 18, 1976 Bell Laboratories memorandum (copy in Subcon- mittee files) characterizes the standard as having “little safety margin," and urges that it be strengthened to 64 or 128 bits. An official of the Office of Mumitions Control has advised the subconmittee that for export use, “anything above 56 bits vou have to come to us," adding that one large U.S. corporation ——sants to use Meprer bits in several overseas situations and in some cases we are going to grant permission." (Telejtone interview with Mr. Clyde Bryant, Januzry 5, 1977). . ad wh
. 744/ Until the formation of the Church Committee, these individuals were likited to selected staff members of the Amed Services comnittees in the Senate ani the House, and the Defense subcommittees of the Appropriativncs comittees in the Senate and the House. This Comnittee has asked several of these staff members if, in the course of exercising their Committee's over- ight functions, the NSA had ever briefed them on Operct.ion SHAMROCK. Some of these individuals replied they were generally aware that the Agency from tine to time inadvertently intercepted private sector commmications; others Said the first they knew of suth activity was when they read it in the news - paper. This Committee has received no indication that any of these individuals had a detailed knowledge of Operation SHA‘ x.
‘ . -7- Chairwoman Bella S. Abzug, November 12, 1976, p. 5. 80/ Ibid, p. Ss. 81/ Seep. . 79/ Letter from Comptroller General of the United States Elmer G. Staats to ae . 82/ Bob Woodward, "CIA Bugging Micronesian Negotiations,” Washington Post December 12, 1976, p. A-1. mr —= 83/ In 1970, when President Nixon endorsed the so-called Huston Plan, under . which the NSA would intercept the private commmications of American citizens, he was unaware that the NSA had for years been conducting a watch-list program similar to what he was proposing; there is no indication the NSA ever informed him of its watch-list activity. ; . — ee, for example, letter from Lt. Gen. Lew Allen, Jr., to Attorney General Elliot Richardson, October 4, 1973, in Church Committee Hearings, Vol. 5, pp. 162-63. : . v ri Letter from Attorney General Elliot Richardson to Lt. Gen. Lew Allen, Jr., QV Cctober.1, 1973,. in Church Comittee Hearings, .Vol..5, pp..160-61. _ bed The Washington Post has described the NRO as spending "an estimated $1.5 illion a year acquiring and managing the most sophisticated, elusive and expensive force of spies that has ever been recruited into the government's service." (Laurence Stern, "1.5 Billion Secret in Sky: U.S. Spy Unit Surfaces by Accident," Washington Post, December 9, 1973, p. A-1). Two years later, the New York Times described the NRO as a semi-autonomous unit "under the Air Force that runs the satellite photography program, set to spend under $2 billion.” (Leslie Gelb, “U.S. Intelligence Cost is Put at $4 Billion," The New York Times, November 19, 1975, p. 40). ; 877 So unthinkable is such disclosure that President Ford invoked “executive privilege” to apply to a private corporation, in an attempt to prevent the turn- over of an old NSA list of countries whose telecommmications the Agency had expressed an interest in intercepting (see p. ). The contents of this list - had long been known to both the company's outside counsel and selected company employees. On October 22, 1975, NSA Director Allen was informally asked by a subconmittee staff member, "What security clearance does a private attomey for a telegraph company have?" "What security clearance does a company employee , who transmits messages have?" Gen. Allen replied, "None." Apparently, in the view of the NSA, these individuals are entitled to information that the Congress is not. 88/ Winslow Peck, "U.S. Electronic Espionage: A Memoir," Ramparts, August 1972. (Reporting on Peck’s allegations, the New York Times stated: "Extensive independent checking in Washington with sources in and out of the Government who were familiar with intelligence matters has resulted in the corroboration of many of his revelations . But experts strongly deny that the United States has broken the sophisticated codes of the Soviet Union or other foreign powers." Benjamin Welles, "Ability to Break Soviet Codes Reported," New York Times, July 16, 1972, p. 1). 8Y S U.S.C. S52a, effective September 27, 1975. SY Federal Register, Vol. 40, No. 168, August 28, 1975, pp. 39777-8021. SY Federal Register, Vol. 40, No. 166, August 26, 1975, pp. 37579-582; Federal’ Register, Vol. 40, No. 187, September 25, 1975, pp. 44294-297. —_— 3Y Federal Register, Vol. 41, No. 13, January 20, 1976, pp. 3025-033. 9 See, for example, House Subcommittee on Government Information and Individual Rights Hearings, "Central Intelligence Agency Exemption in the Privacy Act of 1974, 1975, p. 164; also, Church Committee Final Report, Book II, p. 101.
FOOTROTES Se peans v. william 407 U. $. 143 (1972); Yyvan v. James 500 U. S. 309 (1971); _ ee Terry v. Gnio 392 U. S. 1 (1968); Camara v. Municipal court 2°7 u. $. 523 (1967). 661n Hewfield v. Ryan 91 F.2d 700(3rd Cir. 1937), cert. gen. 302 YU. S. 729 (1937), tre cayrt eer tna SF SubpuRas iu beleuravi Uewunte’ lov wruUUte teleui ans . . re'ating to matters under investigation constituted “other lawful authority” for zerpcses of section 605. 87 tnesed, in Nardone v. United States 362 U. S. 379 (1937), the Suprene Ceurt expressly cecided that the second cleuse of section 605 "“comprehends Fezeral agents" within its prohibition, 302 U. S. at page 381. 68see Sen. Rep. No. 781, 73rd Cong., 2d Sess. 1 (1934); H. Rep. No. 1850, 73rd Cong., 2d Sess/ 3 (1934). O8sce Memorandum of Richard W. Cutler, “Possible Liabilities Arising from surrender of RCA-Transmitted Messages to Government Officials”, November WW, 1948, reprinted in Abzug Committee Hearings, at p. 255 ff. 70s e6 letter from Thomas K. Latimer, Department of Defense, to Robert Fink, Staff Member of the House Government Operations Committee, May 10, 1976, reprinted in Fbzug Committee Hearings, at p. 324 7'See Church Committee Final Report, Vol. III, p. 769.- 72united States v. United States District Court for the Eastern District of Nichigan, 607 UL Sv 297 (1972). 7318 u. S$. Cc. 2511(3). — 7M inited States v. Butenko 494 F.2d 59 United States v. Ivanov 419 U.S. 881 (1974 ; (ird Cir. 1974), cert den. sub nom *Stbid, ePresumadly, this would apply to purely domestic intercepts as well as intérnational intercepts. 77 The Butenko court also Suggest that Fourth Anendment issues, as identified by the Supreme Court in Keith, supra, footnote 72, would be raised by Surveillance conducted for other than foreign intelligence purposes. 494 F.2d at pece €22. . see Church Committee Hearines, cp. 29-23. 7$See Church Committee Final Report, Vol. III., pp. 770-776. 80Ibig.
FOOTNOTES -- PART 11 ~ > md - Pret, Flees €2/ S22 Pink festnste 69 ‘3/ See Fink footnote 70 \4/ Church Comittee Hearings!@ls” se2/ A vol ? 20. See Fink footnote 73 EE | ae 18) ac-Sesse, Book III, pp. 736-37. . Vz General Allen stated that when the w CJ > sth-Sopretry—st-Sesion, Vol. 5, p. 19. CUMMETTTCC Nears Ss - J - ee Mee te See, atch-list activity began, it was viewed as "an appropriate part of the foreign intelligence mission". See Church Committee Hearings, Vol. S, p. 23. § 8/ Testirony of General Lew Allen, Jr., Church Cormittee Hearings, Vol. 5, p. 16. See also the statement of NSA Director Bobby R. Incan before the Senate Subcom- mittee on Intelligence and Human Rights, July 22, 1977. Inman seportedty stated: is now targeted by the NSA in the United wor thetrered 9 misleadoeye , $9/ Senater Schweiker, at the.Church Comnittee 4 Tew Allen, Jr.: “Is there any law that + messages tetseen American citizens if on 1S at a denestic terminal, er do you fee “General Allen: No, I do not believe that." (Church Committee Hearings, Vol. Senétor Mtndale and NSA General Counsel as Terortec in the Washington Post, “Let there be no doubt, no U.S. citizen States or ebroad.”' for feaseng wedaoted om p->¥ abeer, € “gs 2sxed former NSA Director ou feel = its yeu from intercepting eis ata gn terminal and the other ] there is no law that covers this situation? wee there is a lew that specifically does 5, p. 31.) See also discussion between Roy Earner et pp. 45-46. thane $0/ Senator Schweiker at the Church Commttee hearings, asked Fermer NSA Director $ Lew Allen, Jr.: "Would it be pos: ible--g State that you have not done so--would i that you have to monitor domestic conver pérson with mal-intent desired to do it? “General Allen: I don’t think I reel Suppose that such a thing is technically Vol. S, p. 31.) Q1/ Tarss = > 12. Seana naa = — ranted this is not your policy, and you t be pessibie to use this ... apparatus sations within the United States if some ly know feasible.’ how te answer the question. I (Church Comnittee hearings,. one toe eee In thetieee, a U.S, - businessman engaged in selling commercial building preducts to a Middle East oi] Sheikdom, reported that soon after his first international communication regarding such sale, he and his wife were visited knewlecgeable about the proposed sale. by federal intelligence agents who were He further suspected that he was kept under Surveillance thereafter until the sale was completed. tie Jeported that every aspect of the transaction had been conducted us Oe Them ing international cormunications. In e-secteed case, 2 =erber— sis Washington lex fim, hich represented a Client invelved in international trade, reported that in litigation with the Justice Sparment, the government presented evidence vunich ¢zuld only have been obtained through the interception of its clients internationaiéesmunications. The law firn did not feel it was in their client's best interest to pursue the matter, herever. 4a of a lerce multinagt6nbl U.S. corpor- cormnications. He {tated that rfie company’ encr.pted_such cormmulications but In the thiré cise» a senior of Ds : : ; r ation told the Comittee Shad ate that NGA “as intercepting its internatignatT” a o a . . goverrrent regulations prevented the level of encrygtion from b¢ ing so sophisticated that NGA would be prévented from reading it, be lurlier stated, however, that the & company felt such momizéring by’ the gover te te ‘legitimate’.
-2- 42/ Crerch Comittee licarings, Vol. 5, pp. 16-17. Qi See Nov Yors Times, "Adainistration Maps Secret Plan to Fight Telephone Intrusica", July 10, 1977, p. 1; Washington Fest, "Carter Seeking Ways to Block Tntercentinn nf Claccifiad Caliet wh DO ak TRF - «° ry ere gg we ON te ww Ga/ Theoretically ,aNSA could determine what the Soviets were cbtaining from U.S. co-estic co unications by monitoring Soviet transmissions leaving this country. +F us Teerehes-tesaceubt capressed by some suthorities,-nezably David Kohnauther hea. Of The-Celel-estere— hex . tsNSA is able to break Soviet coded transmissions. COS oy SY Sorcreries?-Otd-Hat. I!) “ew York Times, June 22, 1973. hfthis“ts-true, Chearit would seem thatahSA may be Torced to monitor domestic co-cunicetions itself, if it hopes to determine wnat the Soviets are gaining from these intercerts. (Sse Sedat 4.a+6) 4s/ See footnote 88. 6/ Church Comnittee Report, Book III, p. 758. Recently, however, the Justice ‘partment, for the first time, used evidence in a criminal prosecution specifically attributed to NSA interceptions. See Washington Fost, "NSA Tapped Six Overseas Messages by Attorney for Sirhan, FBI Revea s", August "3, 1977. 4§7/ Church Co=mittee Hearings, Vol. $, p. 121. 98/ Church Committee Hearings, Vol. 5, p. 18, 99/ Ibid., p. 16. Also, see footnote $s. \@0/ Letter fron Comptroller General of the United States, Elmer G. Staats to ? = * . * - i Crzir.oman Bella S. Abzug, November 12, 1976. (@l/ Ibid., p. 5.
FQOTHOTE 97-B Cont'd Aus evyretingy oes at - re erate ne we te 8, ‘ eae Lt Aralas ett wont d tase. ot (he CPeotunalye: ma : oe 3 OSee! fase seg wee — { ' ' Peer eos MIEN Cte seemyemce se the teem We twa ang che: yee ce ee -° oll HN Meneses . . , Sle iece meet, wet Im AAR on, World Sear than woetiv after the ¢ : oPEROP ft lee . o 8 ar en ae - 2 . a 3 ° s . $ he ae oe hr ae If Keha's assessment (along with others of a similar nature informally received)is accurate, and the Committee has little reason to doubt its validity, the NSA is largely "out-of-tusisess" vis-aevis the understandi2 of intercepted writben foreign intelligence telecammmnications traveling on circuits most often shared with U.S. citizens, into and out of the U.S. Cn these ciraucts it appears then, that the comprehensible COMINT "take" consists of: (a) relatively low-level encrypted messages of developed countries; (b) telecosmunications of ve.atively unsophisticated countries; and (c) plain-text telecomminications.
. . . f . - rs os aha e+ . ADDENDUM TO FOOTNOTE 30. to the interception of radio commmications, | During MI-8'» operation] _ ; Lifetime, legal'restrictions applicable to the interseption and use of - wire commmications vere non-existent, bat the Aruy Security Agency \ apparently interpreted the statutes appliceble to radio to also — an cable (vire) tranamissions. os NBs
24d on to 61. Former CIA Director William E. Colby gave similar testimony on resting August 6, 1975, stating, "On some occasions, /the interception “sotnote): o? U.S. eitizens’ telecommnicaticas/ cannot be separated fron the treffic that is being monitored. It is technologically impossible to separate them.” (Pike Camittee Hearings, p. 241). In fact, Mr. Colby’s use of the expression “on some occasions" is misleading, inasmch as the NSA constantly faces this problem in its search of international telecomsunication links entering and leaving this country. Mr. Colby's semantic qualifier, “on some occasions,” is not unlike his testicony before this subcommittee, en8 others, that the CIA's 20 yee> rail intercept program - which opened over 190,000 letters - vas azong "bhe few" individual instances of the Agency's domestic illegelities. (Cf., for exarsle, "Central Intelligence Agency Exexstion in the Privacy Act of lov" hearings, House Subcommittee on Government Information and Individual Rights, March 5, 1975 (p. 5) and June 25, 1975 (pp. 139-40)). GleA. Fink footaote 65. °32 on to 8.43. WERE a ons ee 2 mm In xotticg this procedure, written messages of potential interest are isolated “otzoete): from the mass of those transmitted by the use of coxzputers programed to selected "trigger" words or syzbols. ‘The CHMIBADEIMaR extracted messases are then studted by human anelysts. <a=Guseinree However, at overseas bases, many messages are spparently intercepted by human analysts prior to trigger vord screening. Chet Flippo, an __ associate editor of Rolling Stone, reported that he was, in 1967, in the Naval Security Group (the NSA's naval wing), assigned to intercept telecommunications from a desert base in Sidi Yahia,Morooco. In z addition to intercepting diplomatic cables, military messages, telegrams, transcripts of transatlantic phone calls, Flippo vrote, "I also screened reams and reams of transatlantic cables to and from the U.S., regardless of whether they contained any key vords or names. Telegrams or phone calls involving American congressran and journalists, 'dissidents,' miitinational corporations -- vere all targets.” (Chet Flippo, "Can the CIA Turn Students Into Spies?", Rolling Stone, March Ll, 1976). 8.4 The Church Committee's report on the SHAMROCK program stated, "Or all the messages made available to NSA each year, it is estimated that NSA in recent years selected about 150,000 messages a month for NSA enalysts to review. Thousands of these messages in one form or another were distributed to other agencies in response to ‘foreign intelligence requirements.'" (Church Committee Bearings, Vol. 5, p. 60). 90-8 The Pike Comnittee'’s final report noted that “preliminary investigation reveals at least one new area of non-political and non-military ecphasis in international intercept - econoric intelligence. Commni- cations interception in this ares has rapidly developed since 1972, partly in reaction to the Arab oil exbargo and the failure to obtain good information on Russian grain vroduction and negotiations for ‘the purckase with Anerican corporetions.” (Final Report as published is Village Votce, February 16, 1976, p. .
91-A. 91-B. _ treme: Letter from Lt. Gen. Lew Allen, Jr. to Chairman Otis Pike, Bouse Select Comittee on Intelligence, August 25, 1975; QUamm® op. cit., Village Voice, p. 90. Until the formation of the Church Committee, these individuals vere limited to selected staff memters of the Armed Services committees in the Senate and the House, and the Defense subcommittees of the Appro- priations committees in the Senate and the House. This Committee has asked several of these staff members if, in the course of exereising their Committee's oversight functions, the NSA had ever briefed thea on Operation SHAMROCK. Some of these individuals replied they vere generally avare that the Agency from.time to time inadvertently intercepted private sector cormunications; others said the first they knew of such activity was when they read it in the newsperer. This Cammittee bas received no indication that any of these individuals had a detailed knowledge of Operation SHAMROCK. Comebexgy An attachment to a March 9, 1976 letter from Fedefal rve Chairzan Arthur F. Burns to Sen. Frank Church, _Svairman of abcom=ittee on Multinational Corporations of the” Committee on Foreies ‘clations, indicates that Arab oil countrfes had over $11 billién_on deposit with the six largest U/S. banks << plus additional Ehlions in owther U.S. eae of December 31, 1975. The Federal Reserve refused to supphy t the miitinational subcommittee with deposit totals of indi viduel"Mi dale East oil-producing nations, tut the Washington Postynote hat, in 1975, the government of Kuwait had $1.7 billion on depos th the Citibank of New York, and in the ted for nearly two-thirds of all bank and Chase Manhattan Bank, the tion's second ax’ third largest Bagks. (Ronald Kessler, "Banks Hold Huge Fore Deposits: U.S. mers Worried About Pressure Fron Governzehts,” Washington Post, Januaby lb, 1976, p. Awl). By June 30138 2776, the deposits of the Middle East oil-exporting countries in U. S.“ban S ks reportedly totaled around $19 billion (Ten Morgen, “Senators, “hanks Block Probe of Arab Deposits," Washington Post, ber 10, 1976, p. A-1L). See staff report, esnesmeeee §=—"International Debt, the Banks, and U.S. Foreign Foiicy,” prepared for use of Senate Subcommittee on Foreign Economic Policy, of the Cammittee on Foreign Relations, August, 1977. monies deposited in A sentor official of a giant U.S. multinational financial institution, which has well over $1 billion on deposit from a single Middle Eastern oil procucing astion -- as well as substential deposits from others «= bas advised the subcommittee that he has little doubt the NSA is intercepting and anelyzing his company's telecommunications. Dut this officiel, knowledge about the company's telecommunications "risk safeguard management,” stresses that the company is not concerned about NSA intercepts, which it feels are legitimate. (Telephone queswewemiam intervie:, December 14, 1976).