What has received less attention is the clever seeping of high-end intelligence officials into the private sector. This is, of course, nothing new. Public officials go into the private sector all the time. Policemen retire and become private detectives. Anyone has been able to hire someone like this to snoop, surveil, whatever for decades. They made for great TV shows. Generals and government officials often find themselves on boards of huge companies because of their knowledge of the world and of people in government, in some cases, because of their knowledge of people in contracting agencies. Wackenhut was began 50 years ago by a former FBI agent. Corporations have employed all kinds of intelligence gathering personnel and techniques for years. There are countless examples.
Information and experience are traded on all the time for any number of reasons. Water runs downhill.
So it should really be no surprise when Cofer Black, former anti-terrorist Czar at the CIA, former Counterterrorism poohbah at the State Department, current Vice-President at everybody's favorite security company, Blackwater USA (jeees, how many hats can one guy wear?) merged his own company, The Black Group with two others (Terrorism Research Center, Inc. and Technical Defense) to form Total Intelligence Solutions, Inc., a company which, in Black's words:
"Total Intel brings the intelligence gathering methodology and analytical skills traditionally honed by CIA operatives directly to the board room. With a service like this, CEOs and their security personnel will be able respond to threats quickly and confidently --whether it's determining which city is safest to open a new plant in or working to keep employees out of harm's way after a terrorist attack."
The CEO of Total Intelligence, Robert Richer states:
"This new organization unites experts formerly in the government space with terrorism and information warfare experts in the private sector to create an agile and responsive security service for the private sector. [W]e can offer an established worldwide network of experts who can assess the global economic, social and political sensitivities that Fortune 500 companies need to navigate."
Some may remember Richer as the man Porter Goss appointed as Deputy Director of Operations at the CIA to replace James Pavitt. Upon leaving the CIA, he went to Blackwater USA before starting up TIS. The COO of the company, Enrique Prado, brings a ton of experience to the company as well. Prado, who currently serves as VP of Special Government Programs for Blackwater USA, is a 24 year veteran of the CIA with 12 years in the CIA's Counterterrorist Center and 10 years with the CIA's "paramilitary" group, the Special Operations Group.
TIS also provides services to the US government in the "war on terror" which I was just reminded of, again, by George Bush who stated today, "And we are at war."
Like I said, this isn't really new. Since at least 911, and definitely since invading Iraq, there has been a lot of new companies focusing on security measures and intelligence analysis for the private sector. A lot of this started because of the market developed by the reconstruction effort in Iraq, but also it is a continuance of something that has been going on for decades.
In the 1970's companies like Control Risks and Kroll began providing all sorts of information and contingency plans for companies operating in unstable areas. Understanding regional differences for business purposes and capitalizing on this has been going as long as there has been trade. And because of the investments, this knowledge is worth the money and worth the people best suited to accurately analyze situations.
Since 911, there has been a real explosion in these types of companies. They work for governments and they work for the private sector. A lot of these companies are cross-over companies, providing intelligence analysis, training, and security, like Diligence LLC, which is loaded with former US and British officials like William Webster, Joe Allbaugh, Mike Baker, Lord Powell of Bayswater... Some specialize more in one area than in others, like Blackwater, loaded as well with former officials including the Pentagon's former Inspector General and the three at TIS. Some are subsidiaries of much larger companies like MPRI, now owned by L-3 Communications (who themselves provide intelligence analysis to the USG), which once boasted, "We have more Generals per square foot here than in the Pentagon." (Which, come to think of it, doesn't make sense. If there were a General in my bathroom, I'd have more Generals per square foot in my bathroom than the Pentagon, who's square foot ratio would be quite lower, being it is much larger)
One has to wonder if the revolving door has just simply turned into a corridor.
But getting back to Total Intelligence Resources and companies dealing mainly in intelligence analysis, in the 21st century, where information is traded all across the board, and in all kinds of ways, one doesn't really know where the government begins and corporations end, and to what extent these hinge companies with clients on all sides of the cannon are effecting things.
I am not insinuating they are, I am just asking, "Do we know?"
What kind of business climate are we going to be living in where companies are able to hire government trained spooks for any number of tasks?
Take for instance the above mentioned Diligence who, as Businessweek reported recently, at the behest of Barbour Griffith and Rogers (a lobbying firm, who incidentally, Ed Rogers also sits on the board of Diligence) at the behest of a Russian firm, Alpha Group Consortium, penetrated KPMG with a covert operative for the purposes of obtaining KPMG's audit of Alpha Group's rival, IPOC International Growth Fund, Ltd.
From the start, Diligence's goal was clear, if far from simple: Infiltrate KPMG to obtain advance information about the audit of IPOC, an investment fund based in Bermuda. Russian conglomerate Alfa Group Consortium hired Barbour Griffith & Rogers through a subsidiary, and the lobbying firm in turn hired Diligence. Alfa is dueling with IPOC for a large stake in the Russian telecom company MegaFon. "We have a good chance of success on this project,"[Nick] Day [co-founder of Diligence and operative who pulled this off] wrote in an internal Diligence memo, referring to the Bermuda espionage effort. The memo, which BusinessWeek reviewed, added: "We are doing it in a way which gives plausible deniability, and therefore virtually no chance of discovery." Similar Diligence operations, the memo noted, had been successful before.
Within Diligence the KPMG campaign was dubbed Project Yucca, and it unfolded in stages, according to people familiar with the operation and documents filed in a court proceeding involving IPOC and Alfa in the British Virgin Islands. First, two Diligence employees contacted KPMG's Bermuda offices pretending to be organizers of a legal conference on the island, according to a person familiar with the operation. The Diligence staff members called KPMG secretaries and asked about how the office worked. Soon, Diligence had the names of a handful of KPMG employees who might have access to the IPOC data. But Diligence wanted to narrow the list.
The intelligence firm was originally looking for people who fit one of two profiles for sources likely to leak the audit information, according to a Project Yucca planning memo.
And that's exactly what they did.
Now, corporate espionage has been going on for a long time, too. It's just in these days, there has emerged a huge demand for the best experienced, and the best practiced in these types of things. Companies today are employing the vast knowledge and power developed by the two leading countries in intelligence operations, the US and the UK. In fact, it may get to the point where you can't do business without an intelligence consultant that operates like a sub-unit of the CIA.
And there are other problems as well, like Walter Pincus pointed out last year in his Washington Post article
But, by using contract employees, government agencies lose control over those doing this sensitive work and an element of profit is inserted into what is being done. Also, as investigations have revealed, politics and corruption may be introduced into the process.
The office of Director of National Intelligence John D. Negroponte has quietly begun to study the contracting issue because "it already is a problem," a senior intelligence official said in a recent interview.
A related concern for intelligence agencies inside and outside the Pentagon is that the government is training people and getting them security clearances, but they then leave for better pay offered by contractors, sometimes to do the same work.
"Once cleared, they can get a higher salary outside and they are gone," the official said. "We're leasing back our former employees."
Not only does this raise a number of question legally in the corporate world, IPOC is now suing Diligence and Alpha, the CIA itself is rumored to send at least 50% of it's budget out the door
To a degree never before witnessed in American history, many core functions of the U.S. intelligence community are being outsourced to the private sector. Outsourcing has taken place in almost every aspect of intelligence work -- collection, counterintelligence, covert operations –- but nowhere has the recent trend been more dramatic than in the analysis that informs what the President receives on his desk every morning. "The outsourced analysis piece, particularly since 9/11, is a significant portion of the analysis that's done," said John Gannon, a former CIA Deputy Director for Intelligence and now head of BAE Systems' Global Analysis Group. "And it's growing."
Unlike the rest of the government, the intelligence community is allowed to keep its entire budget secret –- "black," in spy jargon -– so it's impossible to say exactly how much outsourcing has occurred. But some experts have speculated that at least 50% of the entire budget now flows to the private sector.
There's also the problem of the wrong analysis getting around, and becoming truth. I wonder even if it would be possible to contract out jobs to plant "truths", or make "truths" or to circulate "truths".
This is all speculation. But the bottom line is, we don't know. In the last six years the Bush administration has greatly accelerated government outsourcing. Don't blame him alone, Al Gore was much the leader in "reinventing government" in his day, however Bush has taken it to an unprecedented level and enriched his buddies along the way. Congress has done very little except for Representative David Price's (D-NC) amendment last year to look into intelligence outsourcing.
U.S. Rep. David Price (NC-04) took the lead today in calling attention to a “major shift in the way our intelligence community operates.” The North Carolina Democrat offered an amendment to the Intelligence Authorization bill to examine the extent to which private companies are conducting sensitive intelligence work for the government. The amendment passed the House by a unanimous voice vote.
“The last few years have seen fundamental changes in our intelligence agencies,” Price said. “Some reports estimate that approximately half of the intelligence community’s budget is now spent through contracts awarded to private sector firms. This is not an inconsequential matter, and it requires the immediate attention of Congress.”
I don't know how that's been going, but it is a step in the right direction.
Permalink | 10 comments