Export Controls: NASA Management Action and Improved Oversight Needed to Reduce the Risk of Unauthorized Access to Its Technologies
Published: 2014-06-20T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: NASA develops sophisticated technologies and shares them with its international partners and others. U.S. export control regulations require NASA to identify and protect its sensitive technology; NASA delegates implementation of export controls to its 10 research and space centers. Recent allegations of export control violations at two NASA centers have raised questions about NASA's ability to protect its sensitive technologies. GAO was asked to review NASA's export control program.
This report assessed (1) NASA's export control policies and how centers implement them, and (2) the extent to which NASA Headquarters and CEAs apply oversight of center compliance with its export control policies. To do this, GAO reviewed export control laws and regulations, NASA export control policies, and State and Commerce export control compliance guidance. GAO also reviewed NASA information on foreign national visits and technical papers and interviewed officials from NASA and its 10 centers as well as from other agencies.
section_title: What GAO Found
paragraphs: Weaknesses in the National Aeronautics and Space Administration (NASA) export control policy and implementation of foreign national access procedures at some centers increase the risk of unauthorized access to export-controlled technologies. NASA policies provide Center Directors wide latitude in implementing export controls at their centers. Federal internal control standards call for clearly defined areas of authority and establishment of appropriate lines of reporting. However, NASA procedures do not clearly define the level of center Export Administrator (CEA) authority and organizational placement, leaving it to the discretion of the Center Director. GAO found that 7 of the 10 CEAs are at least three levels removed from the Center Director. Three of these 7 stated that their placement detracted from their ability to implement export control policies by making it difficult to maintain visibility to staff, communicate concerns to the Center Director, and obtain resources; the other four did not express concerns about their placement. However, in a 2013 meeting of export control officials, the CEAs recommended placing the CEA function at the same organizational level at each center for uniformity, visibility, and authority. GAO identified and the NASA Inspector General also reported instances in which two centers did not comply with NASA policy on foreign national access to NASA technologies. For example, during a 4-month period in 2013, one center allowed foreign nationals on a major program to fulfill the role of sponsors for other foreign nationals, including determining access rights for themselves and others. Each instance risks damage to national security. Due to access concerns, the NASA Administrator restricted foreign national visits in March 2013, and directed each center to assess compliance with foreign national access and develop corrective plans. By June 2013, six centers identified corrective actions, but only two set time frames for completion and only one planned to assess the effectiveness of actions taken. Without plans and time frames to monitor corrective actions, it will be difficult for NASA to ensure that actions are effective.
NASA headquarters export control officials and CEAs lack a comprehensive inventory of the types and location of export-controlled technologies and NASA headquarters officials have not addressed deficiencies raised in oversight tools, limiting their ability to take a risk-based approach to compliance. Export compliance guidance from the regulatory agencies of State and Commerce states the importance of identifying controlled items and continuously assessing risks. NASA headquarters officials acknowledge the benefits of identifying controlled technologies, but stated that current practices, such as foreign national screening, are sufficient to manage risk and that they lack resources to do more. Recently identified deficiencies in foreign national visitor access discussed above suggest otherwise. Three CEAs have early efforts under way to better identify technologies which could help focus compliance on areas of greatest risk. For example, one CEA is working with NASA's Office of Protective Services Counterintelligence Division to identify the most sensitive technologies at the center to help tailor oversight efforts. Such approaches, implemented NASA-wide, could enable the agency to better target existing resources to protect sensitive technologies.
section_title: What GAO Recommends
paragraphs: In April 2014, GAO recommended that the NASA Administrator establish guidance to better define the CEA function, establish time frames to implement foreign national access corrective actions and assess results, and establish a more risk-based approach to oversight, among other actions. NASA concurred with all of our recommendations and provided information on actions taken or planned to address them.

section_title: Letter
paragraphs: Thank you for the opportunity to participate in today’s hearing on the  National Aeronautics and Space Administration’s (NASA) system to  protect sensitive information, including through its export control program.  NASA develops new and sophisticated technologies to accomplish its  missions in areas such as robotic probes to explore the surface of Mars  and spacecraft to transport humans and cargo beyond low-earth orbit.  The National Aeronautics and Space Act directs NASA to provide the  widest practical and appropriate dissemination of information concerning  its activities and results. The U.S. export control system, regulated  primarily by two agencies—the Departments of State and Commerce— seeks to limit the risk of sensitive information and items falling into the  wrong hands while allowing legitimate sharing of information and trade to  occur. U.S. export control regulations require any exporter, including  NASA, to protect its sensitive information and technology. To effectively  achieve its mission, NASA has to strike a balance between protecting  sensitive technologies and information and preserving its mission to  support international partnerships and dissemination of information.  NASA’s export control program is governed by a NASA Policy Directive  and NASA Procedural Requirement (export control NPR). These policies  outline the goals of the export control program and NASA export control  procedures contain detailed requirements and responsibilities for  implementing the policy. NASA performs its mission through numerous  programs and projects across its 10 research and space centers and   NASA Headquarters Export Administrator (HEA), the  headquarters.
Center Directors, and their appointed Center Export Administrators  (CEA), as well as Center Project Managers are some of the key  personnel responsible for implementing NASA’s export control program.
Allegations of export control violations at two NASA centers over the last  two years have raised questions about NASA’s ability to protect its  sensitive technologies. In April 2014, we issued a report entitled Export  Controls: NASA Management Action and Improved Oversight Needed to  Reduce the Risk of Unauthorized Access to Its Technologies. My  remarks today are based on this report and initial actions NASA reported  it has taken to begin addressing our recommendations.
Like the April 2014 report, this statement discusses (1) NASA’s export  control policies and how centers implement them, and (2) the extent to  which NASA Headquarters and CEAs apply oversight of center  compliance with its export control policies.
For our April 2014 report, we reviewed export control laws and  regulations, NASA export control policies, and State and Commerce  export control compliance program guidance. We also reviewed NASA  information on foreign national visits and technical papers and  interviewed export control and security officials from NASA Headquarters  and its 10 centers as well as from other agencies. Our work was  performed in accordance with generally accepted government auditing  standards.
subsections: section_title: Weaknesses in Implementation of NASA Export Control Procedures Create Export Control Vulnerabilities
paragraphs: We found weaknesses in the implementation of NASA’s export control  policy and procedures concerning the CEA function and foreign national  access procedures, which increase the risk of unauthorized access to  export-controlled technology.
Variations in CEA Position, Function, and Resources: NASA’s export  control policy provides the CEA the responsibility to ensure compliance of  all Center program activities with U.S. export control laws and regulations  and states that the position should be “senior-level,” but does not define  what “senior-level” means. NASA headquarters export control officials  define senior-level as a person at the GS-15 level or in the senior  executive service; however, we found that no CEAs were at the senior  executive service level, three were GS-15s, and the CEAs at the  remaining seven centers were at the GS-14 and GS-13 levels.
In addition, NASA’s export control NPR does not contain a provision on  the placement of the export control function and CEA within the center’s  organizational structure. At some centers where they were several levels  removed from the Center Director, CEAs stated that this placement  makes it difficult to maintain authority and visibility to staff, to  communicate concerns to center management, and to obtain the  resources necessary to carry out their export control responsibilities.  Conversely, a CEA at another center stated that his placement as Special  Assistant to the Center Director creates a supportive environment to  incorporate export controls into the project management processes and to  require and provide export control training for the majority of center staff.
NASA headquarters’ export control officials, as well as several CEAs,  noted that limitations in staff resources and time spent on export control  functions makes it difficult to carry out the full range of export control  duties, such as improving center export control procedures or providing a  more robust export control training program. However, NASA’s export  control NPR does not discuss the allocation of resources for the export  control function or for the CEA within the center, and, according to NASA  headquarters’ export control officials, each Center Director has the  discretion of how to allocate resources to the export control function. As a  result, we found variation among the centers in the staff resources  assigned to the export control function, as shown in figure 1.
Moreover, we found indications that the resources assigned to export  controls at centers did not always appear to be commensurate with the  export control workload. Specifically, 8 of the 10 centers had two or fewer  civil servant staff to carry out export control activities for hundreds to  thousands of foreign national visits, Scientific and Technical Information  (STI) reviews, international agreements, and technical assistance  agreements. For example, at one center in 2013, two civilian export  control officials working less than full time on export control activities were  responsible for reviewing and providing any needed export control access  restrictions for over 3,000 foreign national visitors and conducting STI  reviews for over 2,000 publications. NASA’s procedural requirements for  STI requires that all STI intended for release outside of NASA or  presented at internal meetings where foreign persons may be present  undergo technical, legal, and export control reviews, among others, to  ensure that information is not unintentionally released through  publication. See figure 2 for export control workload by center for fiscal  year 2013. The CEA at one of the centers stated that the time to complete  required review activities leaves little time to improve procedures or  provide more robust training. To address the variations in authority,  placement, and resources of the CEAs, we recommended NASA  establish guidance defining the appropriate level and placement for the  CEA function and assess the CEA workload to determine appropriate  resources needed at each Center. NASA concurred, indicating plans to  update existing guidance and to explore strategies to enhance support for  the export control function.
Weaknesses in Foreign National Access: Throughout fiscal year 2013  NASA centers and Headquarters approved over 11,000 foreign national  visits for periods ranging from less than 30 days to greater than 6 months.  NASA’s security procedure requires screening of all foreign national  visitors prior to gaining approval for access to any NASA facility.  However, we identified instances in which NASA security procedures for  foreign national access were not followed, which were significant given  the potential impact on national security or foreign policy from  unauthorized access to NASA technologies. Specifically, at one center,  export control officials’ statements and our review of documentation  identified instances between March and July of 2013, where foreign  nationals fulfilled the role of sponsors for other foreign nationals by  identifying the access rights to NASA technology for themselves and  other foreign nationals for one NASA program. This is not in compliance  with NASA’s security procedures which provide that only NASA civil  servants or JPL employees who are U.S. citizens can act as sponsors for  foreign nationals, which is one step in NASA’s process of approving and  activating foreign national access. This center is taking action to address  this issue and, as of December 2013, it developed a new approval  process and criteria for foreign nationals requesting access to center  automated databases and made revisions to center policies for  information systems and foreign national access. We identified planned  corrective actions at this and other Centers related to the management of  foreign national access and, in our April report, we recommended that  NASA develop plans with specific time frames to monitor these corrective  actions to ensure their effectiveness. NASA concurred and indicated that  it plans to take action to increase the effectiveness of its existing  procedures and implement improvements.
section_title: NASA Lacks a Comprehensive Inventory of Export-Controlled Technologies and Is Not Fully Utilizing Oversight Tools
paragraphs: We found that NASA headquarters export control officials and some  CEAs faced challenges in providing effective oversight. In particular, the  lack of a comprehensive inventory of export-controlled technologies and  not effectively utilizing available oversight tools limit their ability to identify  and address risks.
Lack of a Comprehensive Inventory of Export-Controlled  Technologies: NASA headquarters export control officials and CEAs  lack a comprehensive inventory of the types and location of export- controlled technologies at the centers, limiting their ability to identify  internal and external risks to export control compliance. Five CEAs told us  that they do not know the types and locations of export-controlled  technologies, but rather rely on NASA program and project managers to  have knowledge of this information. NASA’s export control NPR provides  that NASA Center Program and Project Managers, in collaboration with  CEAs, are to identify and assess export-controlled technical data.  Additionally, NASA Center Project Managers are required by NASA’s  export control NPR to provide appropriate safeguards to ensure export- controlled items and technical data are marked or identified prior to  authorized transfer to foreign parties consistent with export control  requirements. The CEA and security chief at one center told us that they  requested a plan identifying where export-controlled and sensitive  technologies are located within a research branch in order to facilitate  foreign national visit requests. According to the branch manager, he was  unable to provide this information, stating it would be too cumbersome to  map out all of that information and try to restrict access to the areas with  sensitive technologies. Assessing areas of vulnerability, including  identifying and assessing export-controlled items, could better ensure that  consistent procedures are practiced. NASA’s lack of a comprehensive  inventory of its export-controlled technologies is a longstanding issue that  the NASA Inspector General identified as early as 1999.
Three centers began recent efforts to identify export-controlled  technologies at their centers—one of which involves coordination with the  center counterintelligence officer. Specifically, at this center, the  counterintelligence office collaborated with the CEA to conduct a sensitive  technology survey—designed to identify the most sensitive technologies  at the center—to better manage risks by developing protective measures  for these technologies in the areas of counterintelligence, information  technology security, and export controls. Such approaches, implemented  NASA-wide, could enable the agency to take a more risk-based approach  to oversight by targeting existing resources to identify the most sensitive  technologies and then ensure the location of such technologies are  known and protected. To implement a risk-based approach, we  recommended NASA build off of existing information sources, such as  assessments by NASA’s counterintelligence office, to identify targeted  technologies. In its response, NASA highlighted plans to implement a  risk-based approach that would include CEAs, program managers, and  counterintelligence officials.
Underutilization of Oversight Tools: NASA’s oversight tools, including  annual audits, export control conferences with CEA, and voluntary  disclosures, have identified deficiencies, but NASA headquarters has not  addressed them. Specifically, we found that seven centers have  unresolved findings, recommendations, or observations spanning a  period from 2005 to 2012, in areas including export control awareness,  management commitment, resources, training, foreign national visitor  processes, and disposal of property. At five centers, responding to audit  findings and implementing recommendations required that the CEA  coordinate with other offices and programs across the center beyond the  CEA’s control. The remaining two centers cited resource constraints,  organizational priorities, and insufficient coordination with center  management as barriers to implementing corrective actions and resolving  recommendations. NASA’s current procedures do not address  coordination among offices at a center to address findings from annual  audits.
Further, NASA headquarters export control officials hold annual export  control program reviews with the CEAs to discuss export control changes  and CEA concerns and recommendations for the program. At NASA’s  2013 annual review, the CEAs presented NASA headquarters export  control officials with a list of comments regarding the export control  program, many of which echo the issues raised in our April 2014 report,  such as CEA position and resources, foreign national access, and  awareness of export-controlled technologies. NASA headquarters’ export  control officials stated that they agree with the issues raised by the CEAs  but acknowledged that they have not fully addressed the CEA concerns  from the most recent program review in March 2013 and have not  developed specific plans to do so. In fact, we found that over the last 3  years, NASA headquarters export control officials provided only one  policy update or other direction to address export control concerns raised  by the CEAs. In our April report, we made two recommendations to  address underutilization of the audit and program review tools. To ensure  implementation of audit findings, we recommended that NASA direct  Center Directors to oversee implementation of the audit findings.  Similarly, we recommended that NASA develop a plan, including  timeframes, to ensure CEA issues and suggestions for improvement are  addressed. NASA concurred and plans to revise existing guidance.
NASA may also be missing an opportunity to use voluntary disclosures to  help improve export control compliance. NASA’s export control NPR  provides that it is every NASA employee’s personal responsibility to  comply with U.S. export control laws and regulations; and further provides  the Departments of State and Commerce’s regulatory requirements for  voluntary self disclosure of noncompliance in export activities, even if the  errors were inadvertent. NASA’s headquarters’ export control program  officials told us that few or no voluntary disclosures might indicate a  weakness in a center’s export control program. We found little usage of  the voluntary disclosure process at the NASA centers: a total of 13  voluntary disclosures divided among four of the NASA centers since  2011, and potential noncompliance ranged from failure to file a record of  shipment to Germany to potential foreign national exposure to a  program’s technical data. The remaining six NASA centers have not  submitted voluntary disclosures since 2011. We found that a similar event  may lead to a voluntary disclosure at one center but not another and that  CEA approaches toward voluntary disclosures at some centers may  affect NASA’s ability to identify and report potential violations of export  control regulations. To ensure consistency in reporting potential export  control violations, in our April 2014 report, we recommended that NASA  re-emphasize to CEAs the requirements on how and when to notify  headquarters. NASA concurred and plans to revise and develop  additional guidance.
As stated above, NASA concurred with all of our recommendations and  stated that our findings and recommendations complement results from  the recent reviews by the NASA’s Inspector General and the National  Academy of Public Administration. Further, NASA stated in its response  to each of these reviews that it plans to adopt a more comprehensive,  risk-based approach to enhance its export control program.
Subsequent to our report, the NASA Administrator issued an email to all  employees reiterating the importance of the export control program and  announcing plans to expand the online and in-person export control  training. This is an important step as it sets a tone from the top and could  help ensure the centers apply consistent approaches. However, it will be  important for NASA to be vigilant in assessing actions taken to help  ensure effective implementation and to avoid a relapse into the former  practices. Collectively, improvements in all of these areas can help NASA  strike an effective balance between protecting the sensitive export- controlled technologies and information it creates and uses and  supporting international partners and disseminating important scientific  information as broadly as possible.
Mr. Chairmen, Ranking Members, and members of the subcommittees,  this concludes my prepared remarks. I would happy to answer any  questions that you may have.
section_title: GAO Contact and Staff Acknowledgements
paragraphs: For questions about this statement, please contact Belva Martin at (202)  512-4841, or at (martinb@gao.gov). Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this statement. Individuals making key contributions to this testimony  include William Russell, Assistant Director; Caryn Kuebler, Analyst-in- Charge; Marie Ahearn; Lisa Gardner; Laura Greifner; Amanda Parker;  and Roxanna Sun.
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