DIS
systematically
collects
Cl information
developed
through
personnel
security
interviews
and industrial
security
inspections.
The Counterintelligence
Office
analyses
this
information
and,
when
appropriate,
provides
it as
Cl and
criminal
investigative
leads
to agencies
such
as the
FBI,
US Customs
Service,
and the
military
services.
Report
the
means
by
which
the
Federal
Government
communicates
information
on
[industrial
espionage]
threats,
and
on
methods
to
protect
against
such
threats,
to
US
industry
in
general
and
to
US
companies
known
to
be
targets
of
foreign
espionage.
US
Government
agencies
identify
and
counter
foreign
economic
espionage
and
illicit
efforts
to
acquire
proprietary
information
from
two
distinct
but
integrated
approaches:
Cl
and
law
enforcement.
As
a
subset
of
those
approaches,
and
taking
advantage
of
the
information
that
the
respective
communities
develop,
the
US
Government
also
counters
those
activities
through
awareness
training.
Awareness
programs
are
designed
to
provide
government
and
private
audiences
with
the
foreign
threat
information
they
need
to
better
protect
classified
and
proprietary
economic
information
from
illicit
collection.
US
Government
contractors
receive
the
vast
majority
of
threat
information
that
flows
from
government
to
industry.
Recipients
include
contractors
for
the
National
Aeronautics
and
Space
Administration
(NASA),
CIA,
and
the
Departments
of
Defense,
Energy,
and
State.
The
primary
US
Government
programs
that
pass
threat
information
to
non-government
affiliated
corporations
are
the
FBI's
DECA
Program;
the
State
Department's
Overseas
Security
Advisory
Council
(OSAC);
and,
on
occasion,
the
CIA's
National
Resources
Division.
NACIC,
which
recently
completed
a
survey
of
the
Cl
needs
of
US
industry,
also
has
implemented
initiatives
to
work
with
these
various
programs
to
provide
more
timely
or
relevant
threat
information
to
the
private
sector.
After
obtaining
information
indicating
that
a
specific
US
company
is
being
targeted
by
a
foreign
intelligence
service
or
government,
the
US
Intelligence
Community
(USIC)
shares
it
with
the
FBI
which
may
inform
the
US
company
about
the
threat.
The
FBI
may
brief
appropriate
personnel
in
the
company
about
the
threat
and
work
with
them
to
counteract
that
threat.
Information
of
a
more
general
nature
also
is
shared
with
the
State
Department's
OSAC
representatives
for
passage
to
the
private
sector.
The
NACIC
will
join
forces
with
OSAC
to
share
threat
information,
particularly
on
the
US
technology
targeted
and
collection
techniques
used
by
foreign
governments.
The
following
tabulation
lists
the
awareness
and
briefing
programs
within
each
US
Government
agency
that
provides
threat
information
to
private
sector
companies:
Federal
Bureau of Investigation
The
DECA
Program
is
the
FBI's
public
voice
and
educational
medium
for
communicating
foreign
threat
information,
especially
the
economic
espionage
threat,
to
the
private
sector.
The
DECA
Program
has
been
in
place
for
over
20
years
and
has
been
an
integral
part
of
the
FBI's
foreign
CI
program.
DECA
coordinators
in
each
of
the
FBI's
56
field
offices
have
regular
liaison
with
companies
located
in
the
field
offices'
territories.
The
DECA
coordinators
furnish
briefings,
videotapes,
pamphlets,
and
other
materials
to
help
the
private
sector
understand
and
recognize
foreign
economic
espionage
threats
directed
at
them.
The
content
of
briefings
and
material
provided
is
tailored
to
the
specific
needs
and
concerns
of
each
company.
The
DECA
coordinators
also
discuss
the
various
methods
employed
by
foreign
governments
to
accomplish
their
intelligence
collection
goals.
During
fiscal
years
1993
and
1994,
the
FBI
briefed
almost
20,000
companies
totaling
nearly
a
quarter
of
a
million
personnel,
in
addition
to
briefings
at
academic
institutions,
laboratories,
and
state
and
local
governments.
The
DECA
Program
is
a
national
effort
with
management,
direction,
and
analytical
support
from
FBI
Headquarters.
As
needed,
FBIHQ
provides
field
offices
with
information,
materials,
and
speaker
support
to
facilitate
a
specific
request
or
need.
It
relies
on
dynamic
and
direct
communication
between
the
DECA
coordinator
and
executives,
security
directors,
and
personnel
in
US
corporations.
In
addition,
the
program
periodically
publishes
a
foreign
intelligence
threat
information
journal
titled
DECA
Notes.
Both
classified
and
unclassified
versions
of
DECA
Notes
and
DECA
briefings
have
been
given
to
US
corporations
throughout
the
United
States.
Department
of State
State
Department's
OSAC
is
a
joint
venture
by
the
Department
and
US
businesses
to
interact
on
overseas
security
problems
of
mutual
concern,
including
foreign
economic
threats.
OSAC
is
administered
under
the
State
Department's
Bureau
of
Diplomatic
Security
(DS).
Over
1,400
private-sector
organizations
participate
in
its
activities
and
receive
information
and
guidance.
As
part
of
the
growing
emphasis
on
the
threat
to
US
business,
OSAC
established
a
Committee
for
Protection
of
Information
and
Technology
that
seeks
to
improve
the
government-industry
partnership.
OSAC
also
oversees "Country
Councils" in
selected
foreign
cities
that
consist
of
US
embassy
security
officers
and
other
post
officials
working
with
security
managers
of
US
private-sector
enterprises
to
exchange
unclassified
security
information
in
a
timely
fashion.
There
are
Country
Councils
in
25
foreign
cities,
with
five
more
planned
for
1995.
Country
Councils
enable
OSAC
to
pass
threat
information
to
industry
and
to
gather
information
from
US
corporations
concerning
threats
to
US
economic
security.
Government
and
business
representatives
have
joined
with
OSAC
to
produce
a
series
of
publications
providing
guidance,
suggestions,
and
planning
techniques
on
a
variety
of
security-related
issues,
including
a
booklet
titled
Guidelines
for
Protecting
US
Business
Information
Overseas,
the
latest
version
of
which
was
published
in
November
1994.
To
exchange
threat
information
as
expeditiously
as
possible,
the
State
Department
created
the
OSAC
Electronic
Bulletin
Board
(EBB).
The
EBB
is
an
unclassified
on-line
system
available
to
OSAC
member
companies
that
serves
as
the
focal
point
for
the
exchange
of
information
between
the
Department
of
State
and
the
US
private
sector.
More
specifically,
DS's
Office
of
Intelligence
and
Threat
Analysis
(ITA)
uses
the
EBB
to
provide
US
corporations
doing
business
abroad
with
timely,
unclassified
security
related
information.
US
firms
supplement
ITA's
information
by
voluntarily
submitting
accounts
of
security
or
crime
incidents
affecting
their
own
or
other
US
overseas
operations.
The
EBB
currently
contains
over
42,000
individual
reports
of
various
types
of
threats
overseas.
Central
Intelligence Agency
The
CIA
provides
information
to
the
FBI
for
use,
as
appropriate
and
in
accordance
with
memoranda
of
understanding
and
executive
orders,
in
the
DECA
Program.
On
occasion,
the
CIA
briefs
US
corporate
officials
directly
concerning
the
foreign
intelligence
threats
facing
US
companies.
The
CIA
has
presented
these
briefings,
which
describe
the
ways
various
countries
conduct
economic
intelligence
collection
against
the
United
States,
to
individual
corporations
and
at
industry-wide
conferences,
often
with
FBI
participation.
The
briefings
cover
foreign
economic
activities
worldwide,
focusing
on
intelligence-gathering
techniques
used
by
specific
countries.
The
CIA
plans
to
offer
another
briefing
on
commercially
available
technical
gear
used
by
foreign
services
to
conduct
economic
espionage
against
US
companies.
As
appropriate,
CIA
coordinates
with
other
US
Government
agencies,
specifically
the
FBI,
before
notifying
a
US
company
that
it
is
the
specific
target.
CIA
also
is
participating
extensively
in
planning
and
implementing
an
array
of
activities
under
the
auspices
of
the
NACIC's
new
interagency
Awareness
Working
Group
(see
below).
These
programs
are
designed
to
inform
and
assist
US
companies
that
are
actual
or
potential
targets.
Department
of Defense
The
Defense
Intelligence
Agency,
under
its
Defense
Information
Counter
Espionage
(DICE)
program,
conducts
briefings
at
conferences
attended
by
government-affiliated
contractors
and
provides
current
threat
information
for
training
courses
for
DOD
contractor
personnel.
The
subjects
of
these
briefings
include
economic
intelligence
collection
activities
by
friendly
countries
and
threats
of
illicit
technology
transfer.
DIA
also
prepares
CI
risk
assessments
on
foreign
ownership
of
DOD-affiliated
US
corporations
and
studies
on
the
foreign
intelligence
threat
to
DOD
programs
and
operations,
including
contractor
programs.
The
Defense
Investigative
Service
shares
information
with
industry
about
targeting
of
specific
technologies
or
specific
contractors
based
on
its
analysis
of
information
from
data
bases
such
as
the
Foreign
Ownership,
Control,
or
Influence
(FOCI)
data
base
and
various
elements
of
the
Foreign
Disclosure
and
Technical
Information
System.
The
focus
of
the
DIS
program
is
to
safeguard
classified
information,
but
its
efforts
also
help
to
protect
proprietary
information.
As
DIS
becomes
aware
of
the
targeting
of
specific
technologies
or
specific
contractors,
that
information
is
shared
with
industry
and
other
US
Government
agencies
as
appropriate.
Foreign
threat
information
also
is
developed
by
DIS
Special
Agents
during
personal
security
interviews
(PSIs)
by
Industrial
Security
representatives
under
the
auspices
of
the
National
Industrial
Security
Program,
and
through
liaison
with
other
US
agencies.
Reports
are
disseminated
throughout
DOD,
throughout
the
USIC,
and
to
cleared
defense
contractors
during
industrial
security
actions.
DIS
is
developing
a
program
to
identify
cleared
facilities
that
are
involved
in
critical
technologies
and
have
interface
with
foreign
interests.
They
will
spearhead
a
briefing/debriefing
program
for
contractor
personnel
who
host
foreign
national
visitors,
conduct
foreign
travel/visits.
interface
with
on-site
foreign
national
visitor
groups,
and
are
assigned
overseas.
The
focus
of
this
program
will
be
to
identify
attempts
by
foreign
nationals
to
circumvent
or
undermine
disclosure
decisions.
DOD
Service
Cl
Components
each
have
comprehensive
programs
to
brief
the
defense
industry
and
the
acquisition
community
on
the
political,
military,
and
economic
threat
to
sensitive
technologies
and
programs
and
the
multi
disciplinary
threat
posed
by
foreign
countries,
visitors,
and
economic
entities.
Military
CI
components
provide
a
full
range
of
CI
support
to
the
military
research,
development,
test,
and
evaluations
community;
acquisition
program
offices;
and
contractors
they
serve.
Their
overall
goal
is
to
detect,
deter,
neutralize,
and
exploit
attempts
by
foreign
entities
to
acquire
restricted
DOD
systems
and
technologies.
The
DOD
Acquisition
Systems
Protection
Program
(ASPP)
attempts
to
unify
the
acquisition,
Cl,
and
security
communities
to
prevent
losses
of
information.
Under
ASPP,
the
acquisition
community
identifies
the
most
essential
elements
of
DOD
acquisition
programs,
known
as
EPITS
(essential
program
information,
technology,
and
systems),
as
well
as
other
pertinent
information
about
DOD
technologies.
The
Cl
community
identifies
threats
to
the
technologies
in
general
and
to
specific
EPITS
by
location
as
far
as
possible.
The
security
community
then
tailors
countermeasures
to
offset
the
threat
and
vulnerabilities
of
the
program.
The
Department
of
Defense
Security
Institute
(DODSI)
develops
and
presents
courses
of
instruction
in
DOD
Security
Countermeasures
programs,
including
industrial,
personnel,
information,
and
security
awareness
and
management
programs.
Discussions
of
the
threat
are
inherent
in
these
programs.
DODSI
also
publishes
unclassified
security
awareness
information.
The
most
well-known
DODSI
publication
is
the
Security
Awareness
Bulletin,
which
is
distributed
to
over
25,000
customers
in
government
and
industry
and
provides
an
easy
vehicle
for
disseminating
CI
information.
Articles
often
highlight
foreign
economic
and
industrial
intelligence
activities
and
ways
to
protect
against
them.
DODSI
is
in
the
process
of
producing
a
series
of
security
awareness
videos
titled
Countering
Espionage.
National
Reconnaissance Office
NRO's
Counterintelligence
Staff
runs
a
Cl
threat
and
awareness
program
to
brief
its
contractor-based
personnel
on
the
intelligence
threat
targeting
their
systems
and
programs.
National
Security Agency
The
NSA
conducts
briefings
and
develops
and
organizes
courses,
seminars,
and
conferences
to
sensitize
its
contractors
cleared
for
special
compartmented
information
to
the
foreign
intelligence
threat
domestically
and
overseas.
NSA
provides
general
and
country-specific
threat
information
in
all
indoctrination
and
orientation
briefings,
debriefings,
and
special
briefings
(for
example,
defensive
travel
briefings,
courier
briefings,
special
access
briefings,
and
so
forth).
NSA
products
are
not
provided
directly
to
the
private
sector,
and
there
are
currently
no
plans
to
do
so.
On
rare
occasions
when
specific
threat
information
of
import
to
a
US
company
is
developed
by
NSA,
the
information
may
be
provided
to
the
FBI.
Subject
to
NSA
approval.
a "sanitized" FBI
threat
notification
may
be
made
to
the
firm.
National
Counterintelligence Center
The
NACIC
was
established
in
1994
in
accordance
with
Presidential
Decision
Directive/NSC-24,
titled "US
Counterintelligence
Effectiveness." It
is
the
NACIPB's
primary
mechanism
to
guide
all
national
level
Cl
activities,
including
countering
foreign
economic
and
industrial
intelligence
collection
activities.
The
NACIC
Threat
Assessment
Office
has
begun
to
compile
intelligence
and
open-source
reporting
on
the
clandestine
targeting
of
US
industry
and
technologies
by
foreign
powers
or
their
intelligence
services.
It
fulfills
this
in
cooperation
with
other
US
Government
agencies
in
three
ways:
1.
By
providing
analyses
on
threats
to
emerging
or
existing
technologies
and
on
threats
to
critical
facilities
in
the
United
States
or
overseas.
2.
By
identifying
and
broadly
disseminating
information
on
human
and
technical
collection
methods
used
by
foreign
powers
against
the
United
States,
including
threats
encountered
by
US
businessmen
at
home
or
overseas.
3.
By
assessing
the
CI
aspects
of
foreign
disclosures,
foreign
ownership,
technology
transfers,
and
joint
ventures.
In
cooperation
with
other
US
Government
agencies,
the
NACIC
has
begun
to
provide
certain
reports,
as
appropriate
based
upon
classification
and
dissemination
caveats,
to
US
private
firms
with
and
without
classified
government
contracts.
The
NACIC
has
responded
to
limited
tasking
from
US
corporations
for
threat
information
and
will
seek
to
make
this
service
more
available
to
private-sector
customers.
The
NACIC
Program
Integration
Office.
through
the
NACIC
Awareness
Working
Group,
also
serves
as
a
community
coordinating
body
for
CI
training
and
awareness
programs.
As
such,
it
facilitates
the
development
and
monitors
the
effectiveness
of
US
Government
awareness
programs
for
both
the
public
and
private
sectors.
Cl
information
describing
the
threat
to
US
industry
is
incorporated
into
these
awareness
presentations
.
The
NACIC
is
currently
participating
in
two
surveys
of
private
industry.
The
first
was
conducted
in
coordination
with
OSAC,
under
the
direction
of
the
National
Security
Council.
It
was
distributed
in
December
1994
and
January
1995
to
OSAC
member
companies.
This
survey
was
designed
to
identify
ways
to
enhance
the
relationship
between
the
CI
community
and
US
private
industry.
It
sought
the
opinion
of
industry
on
how
the
US
Government
could
better
provide
private
corporations
with
information
on
the
threat
from
foreign
intelligence
and
security
services
overseas
and
in
the
United
States.
Results
of
this
survey
are
now
being
tabulated
and
will
be
used
to
help
formulate
US
Government
policy
on
how
to
best
fill
the
CI
needs
of
US
industry.
The
NACIC
is
also
participating
in
a
spring
1995
survey,
in
conjunction
with
the
American
Society
of
Information
Security
(ASIS)
and
Michigan
State
University,
to
gauge
the
severity
of
the
of
proprietary
information
in
the
private
sector.
This
survey
is
designed
to
update
and
validate
a
1992
ASIS
survey
on
the
same
subject.
The
survey
will
be
distributed
to
approximately
6,000
US
corporations,
and
results
are
planned
to
be
published
by
summer
1995.
Department
of Energy
DOE's
CI
Program
mission
is
to
deter
and
neutralize
foreign
intelligence
activities
in
the
United
States
directed
at
or
involving
DOE
programs,
facilities,
technology,
personnel,
and
sensitive
unclassified
and
classified
information.
The
DOE
Counterintelligence
Division
communicates
the
foreign
threat
through
its
awareness
training
program,
analysis
program,
foreign
travel
briefing
and
debriefing
programs,
and
the
dissemination
of
to
reign
intelligence
threat
information
to
employees,
scientists,
managers,
and
security
personnel.
The
Counterintelligence
Division
regularly
publishes
classified
and
unclassified
analytical
studies.
bulletins,
newsletters.
and
other
information
about
foreign
intelligence
threats
to
DOE
facilities
and
personnel.
This
threat
information
is
also
shared
with
other
US
Government
agencies
and
US
corporations
who
have
entered
into
cooperative
research
and
development
agreements
(CRADAs)
with
DOE.
Department
of Commerce
Although
the
Department
of
Commerce
does
not
have
a
formal
program
to
provide
CI
support
to
US
business,
it
provides
informal
assistance
through
security
awareness
briefings
to
contractors
and
consultants
with
access
to
classified
information.
Its
Office
of
Export
Enforcement
conducts
an
industry
outreach
program
that
provides
information
to
numerous
industry
officials
each
year
on
CI
as
it
relates
to
illegal
technology
transfer.
Various
Department
of
Commerce
components
also
publish
newsletters
and
magazines
that
contain
highlights
of
security
incidents
and
illicit
export
practices.
US
Customs Service
In
support
of
its
multifaceted
mission,
Customs
has
for
years
operated
several
education
and
outreach
programs
designed
to
familiarize
private
industry
with
the
export
laws
and
regulations
and
with
the
Customs
Service
roles
in
enforcing
them.
These
programs
have
included
threat
information
when
it
applies
to
export
issues.
National
Aeronautics and Space Administration
NASA
provides
specific
threat
information
to
NASA
employees
and
contractors
involved
in
Special
Access
Programs
through
approximately
1,500
security
awareness
briefings
annually.
Although
there
are
no
NASA
resources
solely
dedicated
to
conducting
awareness
briefings,
security
specialists
are
usually
assigned
the
tasks
Report
the
specific
measures
that
are
being
or
could
be
undertaken
in
order
to
improve
the
activities
referred
to
in
the
above
paragraphs,
including
proposals
Or
any
modifications
of
law
necessary
to
facilitate
the
undertaking
of
such
activities.
Cl
efforts
are
governed
by
presidential
directives,
executive
orders,
and
statutes,
many
of
which
were
established
during
the
Cold
War
and
were
designed
to
counter
a
corresponding
threat:
that
is,
foreign
intelligence
activities
directed
against
US
military
and
political
information.
Over
the
past
three
years,
some
of
these
guidelines
have
been
adapted
to
better
confront
the
post-Cold
War
reality
that
economic
and
technological
information
are
as
much
a
target
of
foreign
intelligence
collection
as
military
and
political
information.
Law
enforcement
efforts
are
similarly
limited
because
economic
and
technological
information
is
often
not
specifically
protected
by
Federal
laws,
making
it
difficult
to
prosecute
thefts
of
proprietary
technology
or
intellectual
property.
Law
enforcement
efforts
instead
must
rely
on
less
specific
criminal
laws-such
as
espionage.
fraud
and
stolen
property,
and
export
statutes-to
build
prosecutable
cases
against
foreign
economic
and
industrial
intelligence
collectors
and
to
deter
such
activity.
The
Administration
is
considering
legislative
options
to
strengthen
current
Federal
statutes,
and
possibly
to
establish
new
laws
that
would
specifically
forbid
theft
of
intellectual
property
and
proprietary
information.
While
other
options
are
under
various
stages
of
consideration,
the
following
are
included
as
examples:
Executive
Branch Policy Options Increase
resources available to US CI
and law enforcement organizations
to investigate and, where appropriate,
prosecute entities involved in
industrial and economic intelligence
collection activities targeting
US information.
As
attested
by
the
Aldrich
Ames
espionage
case,
the
end
of
the
Cold
War
has
not
stopped
traditionally
hostile
foreign
intelligence
services
from
collecting
information
via
espionage.
US
CI
agencies
continue
to
allocate
resources
against
traditional
intelligence
threats.
However,
while
such
threats
have
continued,
an
increasing
portion
of
US
CI
and
law
enforcement
resources
is
also
being
drawn
to
thwart
economic
and
industrial
intelligence
collection
activities.
Some
of
these
more
recently
identified
activities
are
conducted
by
traditional
threat
countries
and
can
be
investigated
with
existing
resources
directed
against
those
countries.
Countries
that
heretofore
have
not
been
considered
intelligence
threats
account
for
much
of
the
economic
collection
currently
being
investigated
by
the
US
CI
and
law
enforcement
communities.
Since
the
CI
community
does
not
have
the
benefit
of
years
of
accumulated
experience
investigating
such
efforts,
these
investigations
are
often
labor
intensive.
Resources
in
these
areas
will
likely
have
to
be
increased,
especially
if
the
theft
of
proprietary
information
is
made
a
Federal
violation,
since
the
result
would
be
an
increased
number
of
cases
requiring
more
trained
investigators
and
analysts.
Institutionalize
the concept that economic security
is an integral part of national
security.
The
goal
of
US
Cl
is
to
identify,
penetrate,
and
neutralize
foreign
intelligence
activities
that
threaten
US
national
security.
Cl
has
traditionally
been
directed
at
military,
ideological,
or
subversive
threats
to
national
security.
Until
the
past
several
years,
countering
activities
that
threaten
economic
security
had
not
usually
been
included.
In
today's
world
in
which
a
country's
power
and
stature
are
often
measured
by
its
economic/industrial
capability,
foreign
government
ministries-such
as
those
dealing
with
finance
and
trade-and
major
industrial
sectors
are
increasingly
looked
upon
to
play
a
more
prominent
role
in
their
respective
country's
collection
efforts.
While
a
military
rival
steals
documents
for
a
state-of-the-art
weapon
or
defense
system,
an
economic
competitor
steals
a
US
company's
proprietary
business
information
or
government
trade
strategies.
Just
as
a
foreign
country's
defense
establishment
is
the
main
recipient
of
US
defense-related
information,
foreign
companies
and
commercially
oriented
government
ministries
are
the
main
beneficiaries
of
US
economic
information.
The
aggregate
losses
that
can
mount
as
a
result
of
such
efforts
can
reach
billions
of
dollars
per
year,
constituting
a
serious
national
security
concern.
The
March
1990
and
February
1995
national
security
strategies
published
by
the
White
House
focus
on
economic
security
as
an
integral
part
not
only
of
US
national
interest
but
also
of
national
security.
In
February
1995,
President
William
J.
Clinton
published A
National
Security
Strategy
of
Engagement
and
Enlargement in
accordance
with
the
Goldwater-Nichols
Defense
Department
Reorganization
Act
of
l986.
It
identified
the
US
central
goals
as:
- To
sustain our security with military
forces that are ready to fight.
- To
bolster America's economic revitalization.
- To
promote democracy abroad
.
The
report
identifies
US
intelligence
capabilities
as
critical
instruments
of
national
power
and
notes:
The
collection and analysis of intelligence
related to economic development
will play an increasingly important
role in helping policy matters
understand economic trends. That
collection and analysis can help
level the economic playing field
by identifying threats to US
companies from foreign intelligence
services and unfair trading practices.
(p17)
The
report
describes
the
US
Government
partnership
with
business
and
labor,
noting:
Our
economic strategy views the private
sector as the engine of economic
growth It sees government's role
as a partner to the private sector-acting
as an advocate of US business
interests; leveling the playing
field in international markets;
helping to boost American exports;
and finding ways to remove domestic
and foreign barriers to the creativity,
initiative and productivity of
American business (p 19)
Guidance
issued
from
1990
to
the
present
directs
the
Intelligence
Community
and
Cl
community
specifically
to
detect
and
deter
foreign
intelligence
targeting
of
US
economic
and
technological
interests,
including
efforts
to
obtain
US
proprietary
information
from
companies
and
research
institutions
that
form
our
strategic
industrial
base.
Consistent
with
US
national
security
policy
since
1990.
then,
the
Cl
community
should
emphasize
economic
security
in
operations,
reports,
and
briefings
designed
to
fulfill
the
guidance
outlined
above.
Develop
a
coordinated
CI
and
law
enforcement
approach
and
appropriate
collection
and
analytic
requirements
to
address
foreign
economic
and
industrial
intelligence
collection
activities.
Previous
reports
sponsored
by
the
Executive
and
Legislative
Branches
have
found
that
efforts
across
the
government
to
investigate
and
counter
economic
and
industrial
intelligence
collection
activities
were
often
fragmented
and
uncoordinated.
The
Cl
and
law
enforcement
communities
have
usually
not
effectively
harmonized
their
efforts.
Numerous
interagency
working
groups
and
committees
had
been
formed
to
discuss
the
problem,
while
at
the
same
time
a
number
of
individual
agencies
were
exerting
their
own
efforts.
This
lack
of
coordination
resulted
in
many
partially
informed
decisions
and
diverging
collection
and
analytical
efforts.
The
Executive
Branch
is
developing
a
coordinated
Cl
and
law
enforcement
approach
and
appropriate
collection
and
analytic
requirements.
Since
its
inception,
the
NACIC
has
made
efforts
to
determine
the
CI
needs
of
various
traditional
and
nontraditional
intelligence
consumers.
In
the
process
of
surveying
agency
customers,
the
NACIC
discovered
that
many
needs
have
not
fully
been
met
in
the
past,
either
because
no
mechanism
was
in
place
to
fulfill
the
needs
or
because
the
existing
mechanism
was
malfunctioning.
As
part
of
the
NAClC's
program
of
determining
Cl
needs,
it
will
assist
in
forming
appropriate
and
manageable
requirements
to
ensure
that
1)
necessary
information
is
being
collected
and
2)
once
the
information
is
collected,
it
reaches
those
that
need
it.
Systematically
collect
and
analyze
information
about
the
efforts
of
foreign
countries
not
traditionally
considered
intelligence
threats,
along
with
corporations
from
those
countries,
to
collect
protected
US
Government
and
corporate
information.
Over
the
past
several
months,
the
NACIC
has
interviewed
over
170
officials
from
62
US
Government
agencies-both
those
that
are
customarily
involved
in
Cl
and
those
who
have
not
usually
been
included
in
such
efforts-to
determine
the
Cl
needs
of
the
US
Government.
Several
policy
makers
interviewed
cited
a
lack
of
information
on
the
activities
of
countries
that
have
not
traditionally
been
considered
intelligence
threats
but
that
may
be
mounting
aggressive
intelligence
targeting
efforts
against
our
leading-edge
technologies,
economic
infrastructure,
and
personnel.
They
desire
better
information
about
whether
information
and
technology
shared
with
allies
through
legitimate
projects
are
being
siphoned
off
and
provided
to
foreign
competitors,
and
how
much
information
is
being
acquired
by
foreign
students
studying
at
US
universities
and
research
centers.
They
are
also
interested
in
what
intelligence
capabilities
the
US
Government
is
providing
to
friendly
foreign
countries
through
liaison
relationships
that
could
be
used
to
collect
US
information.
More
proactive
and
aggressive
collection
against
intelligence
serv
ices
and
corporate
information
collection
personnel
from
countries
traditionally
allied
with
the
United
States
needed
to
fill
these
intelligence
gaps.
Report
on
the
threat
to
US
industry
of
foreign
industrial
espionage
and
any
trends
in
that
threat,
including:
1.
The number and identity of the
foreign governments conducting
any but foreign industrial espionage.
A.
Country Case Studies
A
number
of
foreign
countries
pose
various
levels
and
types
of
threats
to
US
economic
and
technological
information.
Some
have
been
considered
ideological
and
military
adversaries
for
decades.
Their
targeting
of
US
economic
and
technological
information
is
not
new
but
has
continued
as
an
extension
of
a
concerted
intelligence
assault
on
the
United
States
conducted
throughout
the
Cold
War.
Others
are
either
longtime
allies
of
the
United
States
or
have
traditionally
been
neutral.
These
countries
target
US
economic
and
technological
information
despite
their
friendly
relations
with
the
United
States.
In
some
cases,
they
take
advantage
of
their
considerable
legitimate
access
to
US
information
and
collect
sensitive
information
more
easily
than
our
military
adversaries.
In
addition,
some
of
the
countries
traditionally
considered
allies
have
infrastructures
that
allow
them
to
easily
internalize
high-tech
information
and
utilize
it
in
competition
against
US
firms.
The
evidence
indicating
which
countries
and
corporations
conduct
economic
and
industrial
espionage
against
the
United
States
is
derived
from
numerous
classified
and
open
sources.
Because
of
the
ramifications
to
US
foreign
policy
as
well
as
the
sensitivity
of
source
information,
the
specific
identities
of
countries
are
included
in
the
classified
report
only.
2.
The industrial sectors and types
of information and technology
targeted by such espionage.
B.
Targeted Information and Technology
The
industries
that
have
been
the
targets
in
most
cases
of
economic
espionage
and
other
collection
activities
include
biotechnology;
aerospace;
telecommunications,
including
the
technology
to
build
the "information
superhighway";
computer
software/
hardware;
advanced
transportation
and
engine
technology;
advanced
materials
and
coatings,
including
'
stealth" technologies;
energy
research;
defense
and
armaments
technology;
manufacturing
processes;
and
semiconductors.
Proprietary
business
information-that
is,
bid,
contract,
customer,
and
strategy
in
these
sectors
is
aggressively
targeted.
Foreign
collectors
have
also
shown
great
interest
in
government
and
corporate
financial
and
trade
data.
These
industries
are
of
strategic
interest
to
the
United
States
because
they
produce
classified
products
for
the
government,
produce
dual
use
technology
used
in
both
the
public
and
private
sectors,
and
are
responsible
for
leading-edge
technologies
critical
to
maintaining
US
economic
security.
Many
other
US
high-tech
industrial
sectors
have
been
targeted.
Any
company
competing
for
a
sale
or
a
piece
of
market
share,
regardless
of
the
market,
could
resort
to
intelligence
activities
as
a "force
multiplier" to
improve
its
chances
of
success.
Currently,
there
is
no
formal
mechanism
for
determining
the
full
qualitative
and
quantitative
scope
and
impact
of
the
loss
of
this
targeted
information.
Industry
victims
have
reported
the
loss
of
hundreds
of
millions
of
dollars,
lost
jobs,
and
lost
market
share.
However,
these
reports
have
been
ad
hoc
and
often
only
after
public
exposure
of
the
loss.
Understandably,
US
industry
is
reluctant
to
publicize
occurrences
of
foreign
economic
and
industrial
espionage.
Such
publicity
can
adversely
affect
stock
values,
customers'
confidence,
and
ultimately
competitiveness
and
market
share.
3.
The methods used to conduct such
espionage.
C.
Collection methods
Practitioners
seldom
use
one
method
in
isolation
but
combine
them
into
concerted
collection
programs.
Although
countries
or
corporations
have
been
known
to
turn
legitimate
transactions
or
business
relationships
into
clandestine
collection
opportunities,
some
of
the
methods
listed
are
most
often
used
tor
legitimate
purposes.
While
their
inclusion
here
is
not
intended
to
imply
illegal
activity,
they
are
listed
as
potential
elements
of
a
broader,
coordinated
intelligence
effort.
Traditional
Methods:
Traditional espionage methods primarily reserved for collecting national
defense information are now being applied to collect economic and
proprietary information. Traditional awareness training is most suitable
for fufullling these collection methods.
Classic
Agent Recruitment. An
intelligence collector's best
source is a trusted person inside
a company or organization whom
the collector can task to provide
proprietary or classified information.
A foreign collector's interest
in employees is not necessarily
commensurate with their rank
in ~he company. Researchers,
key business managers. and corporate
executives can all be targets.
but so can support employees
such as secretaries, computer
operators, technicians, and maintenance
people. The latter frequently
have good, if not the best, access
to competitive information. In
addition, their lower pay and
rank may provide fertile ground
tor manipulation by an intelligence
agency.
US
Volunteers.
The individuals most likely to
improperly acquire a company's
information are the company's
own employees. Employees ~ho
resort to stealing information
exhibit the same motivations
and human frailties as the average
thief or spy: illegal or excessive
use of drugs or alcohol. money
problems, personal stress, and
just plain greed.
Surveillance
and Surrephtious Entry.
Economic and industrial espionage
may involve simply breaking into
an office containing desired
information. Companies have reported
break-ins in which laptop computers
or disks were stolen, even when
there were easily obtainable,
more valuable items in the same
vicinity. These instances are
not always reported, or reported
as merely break-ins, without
considering the possibility that
the target was information rather
than equipment.
Some
countries
convince
hotel
operators
to
provide
intelligence
collectors
with
access
to
visitors'
luggage
or
rooms.
During
these
surreptitious
break-ins,
known
colloquially
as "bag
ops," unattended
luggage
is
searched
for
sensitive
information,
and
any
useful
documents
are
copied
or
simply
stolen.
Specialized
Technical Operations.
This includes computer intrusions,
telecommunications targeting
and intercept, and private-sector
encryption weaknesses. These
activities account for the largest
portion of economic and industrial
information lost by US corporations.
Because
they
are
so
easily
accessed
and
intercepted,
corporate
telecommunications-particularly
international
telecommunications-provide
a
highly
vulnerable
and
lucrative
source
for
anyone
interested
in
obtaining
trade
secrets
or
competitive
information.
Because
of
the
increased
usage
of
these
links
for
bulk
computer
data
transmission
and
electronic
mail,
intelligence
collectors
find
telecommunications
intercepts
cost-effective.
For
example.
foreign
intelligence
collectors
intercept
facsimile
transmissions
through
government-owned
telephone
companies,
and
the
stakes
are
large
--
approximately
half
of
all
overseas
telecommunications
are
facsimile
transmissions.
Innovative "hackers''
connected
to
computers
containing
competitive
information
evade
the
controls
and
access
companies'
information.
In
addition,
many
American
companies
have
begun
using
electronic
data
interchange,
a
system
of
transferring
corporate
bidding,
invoice,
and
pricing
data
electronically
overseas.
Many
foreign
government
and
corporate
intelligence
collectors
find
this
information
invaluable.
Economic
Disinformation.
Some governments also use disinformation
campaigns to scare their domestic
companies and potential clients
away from dealing with US companies.
Press and government agencies
frequently discuss foreign economic
and industrial intelligence activities,
often in vague, nonspecific terms.
The issue has been used to paint
foreign competitors or countries
as aggressive and untrustworthy,
even if the accuser has no tangible
evidence of any collection activity.
Some countries have widely publicized
their efforts to set up information
security mechanisms to protect
against their competitors' penetration
attempts, and frequently the
United States is mentioned as
the primary threat.
Other
Economic Collection Methods:
Tasking
Foreign
Students
Studying
in
the
United
States.
Some
foreign
governments
task
foreign
students
specifically
to
acquire
information
on
a
variety
of
economic
and
technical
subjects.
In
some
instances,
countries
recruit
students
before
they
come
to
the
United
States
to
study
and
task
them
to
send
any
technological
information
they
acquire
back
to
their
home
country.
Others
are
approached
after
arriving
and
are
recruited
or
pressured
based
upon
a
sense
of
loyalty
or
fear
tor
their
home
country's
government
or
intelligence
service.
In
some
instances.
at
a
intelligence
collector's
behest.
foreign
graduate
students
serve
as
assistants
at
no
cost
to
professors
doing
research
in
a
targeted
field.
The
student
then
has
access
to
the
professor's
research
and
learns
the
applications
of
the
technology.
As
an
alternative
to
compulsory
military
service,
one
foreign
government
has
an
organized
program
to
send
interns
abroad,
often
with
the
specific
task
of
collecting
foreign
business
and
technological
information.
Tasking
Foreign Employees of US Firms
and Agencies.
Foreign companies and governments
sometimes recruit or task compatriot
employees within a US firm to
steal proprietary information.
Although similar to clandestine
recruitment used traditionally
b~ intelligence services, often
no intelligence service is involved,
only a competing company or non-intelligence
government agency. The collector
then passes the information directly
to a foreign firm or the government
for use in its R&D
activities.
Debriefing
of Foreign Visitors to the United
States.
Some countries actively debrief
their citizens after foreign
travel, asking for any information
acquired during their trips abroad.
Sometimes these debriefing sessions
are heavy-handed, with some foreign
scientists describing them as
offensive. In other countries,
they are simply an accepted part
of traveling abroad.
Recruitment
of Emigres, Ethnic Targeting.
Frequently, intelligence collectors
find it effective to target persons
of their own ethnic group. They
particularly seek; individuals
working in US military and R&D
facilities who have access to
proprietary and classified US
technology. Several countries
have found repatriation of emigre
and foreign ethnic scientists
to be the most beneficial technology
transfer methodology. One country,
in particular, claims to have
repatriated thousands of ethnic
scientists back to their home
country from the United States.
Ethnic targeting includes attempts
to recruit and task naturalized
US citizens and permanent resident
aliens to assist in acquiring
US S&T
information. Frequently, foreign
intelligence collectors appeal
to a person's patriotism and
ethnic loyalty. Some countries
collectors resort to threatening
family members that continue
to reside in their home country.
Elicitation
During International Conferences
and Trade Fairs.
Events-such as international
conferences on high-tech topics,
trade fairs, and air shows-attract
many foreign scientists and engineers,
providing foreign intelligence
collectors with a concentrated
group of specialists on a certain
topic. Collectors target these
individuals while they are abroad
to gather any information the
scientists or engineers may possess.
Sometimes, depending on the foreign
country and the specific circumstances,
these elicitation efforts are
heavy-handed and threatening,
while other times they are subtle.
Foreign
intelligence
collectors
sometimes
attempt
to
recruit
scientists
by
inviting
them
on
expense-paid
trips
abroad
for
conferences
or
sabbaticals.
The
individuals
are
treated
royally,
and
their
advice
is
sought
on
areas
of
interest.
When
they
return
to
the
United
States,
collectors
recontact
them
and
ask
them
to
provide
information
on
their
areas
of
research.
Commercial
Data Bases, Trade and Scientific
Journals, Computer Bulletin Boards,
Openly Available US Government
Data, Corporate Publications.
Many collectors take advantage
of the vast amount of competitive
information that is legally and
openly available in the United
States. Open-source information
can provide personality profile
data, data on new R&D
and planned products, new manufacturing
techniques, and competitors'
strengths and weaknesses. Most
collectors use this information
for its own worth in their business
competition. However, some use
openly available information
as leads to refine and focus
their clandestine collection
and to identity individuals and
organizations that possess desired
information.
Clandestine
Collection of Open-Source Materials.
Because they believe that they
are closely monitored by US Cl,
some traditional intelligence
services resort to clandestine
methods to collect even open
source materials. They have been
known to use false names when
accessing open-source data bases
and at time ask that a legal
and open relationship be kept
confidential .
Foreign
Government Use of Private-Sector
Organizations, Front Companies,
and Joint Ventures.
Some foreign governments exploit
existing non-government affiliated
organizations or create new ones-such
as friendship societies, international
exchange organizations, import-export
companies, and other entities
that have frequent contact with
foreigners-to gather intelligence
and to station intelligence collectors.
They conceal government involvement
in these organizations and present
them as purely private entities
in order to cover their intelligence
operations. These organizations
spot and assess potential foreign
intelligence recruits with whom
they have contact. Such organizations
also lobby US Government officials
to change policies the foreign
government considers unfavorable.
Corporate
Mergers and Acquisitions.
Several countries use corporate
mergers and acquisitions to acquire
technology. The vast majority
of these transactions are made
for completely legitimate purposes.
However, sometimes they are made
specifically to allow a foreign
company to acquire US-origin
technologies without spending
their own resources on R&D.
According
to
a
1994
US
Government
report,
entitled
Report
on
US
Critical
Technology
Companies
984
foreign
mergers
and
acquisitions
of
US
critical
technology
companies
occurred
between
1
January
1985
and
1
October
1993.
All
but
a
handful
of
these
mergers
and
acquisitions
were
friendly,
and
four
countries
accounted
for
60
percent
of
them.
Of
the
total,
60
percent
involved
US
firms
in
advanced
materials,
computers-including
software
and
peripherals-and
bio-technology,
areas
of
relative
US
technical
strength.
The
remaining
deals
involved
US
firms
in
electronics
and
semiconductors,
professional
and
scientific
instrumentation,
communications
equipment,
advanced
manufacturing,
and
aircraft
and
spare
parts.
Headhunting,
Hiring Competitors' Employees.
Foreign companies typically hire
knowledgeable employees of competing
US firms to do corresponding
work for the foreign firm. At
times, they do this specifically
to gain inside technical information
from the employee and use it
against the competing US firm.
Corporate
Technology Agreements. Some
foreign companies use potential
technology sharing agreements
as conduits for receiving proprietary
information. In such instances,
foreign companies demand that,
in order to negotiate an agreement.
the US company must divulge large
amounts of information about
its processes and products, sometimes
much more than is justified by
the project being negotiated.
Often, the information requested
is highly sensitive. In some
of these cases, the foreign company
either terminates the deal after
receipt of the information or
refuses to negotiate further
if denied the information.
Sponsorship
of Research Activities in the
United States.
Numerous foreign countries exploit
a favorable research climate
in the United States to sponsor
research activities at US universities
and research centers. Generally,
both the US and the foreign country
benefit from the finished research.
At times, however, foreign governments
or companies use the opportunity
as a one-sided attempt only to
collect research results and
proprietary information at the
US facility. Foreign intelligence
services also use these efforts
as platforms to insert intelligence
officers who act solely as information
collectors.
Hiring
Information Brokers, Consultants.
Information brokers scour the
world for valuable proprietary
data. What they cannot obtain
legally or by guile, some information
brokers purchase. The broker
then verifies the data, puts
it into a usable and easily accessible
format, and delivers it to interested
clients. The following advertisement
published in the Asian Wall Street
Journal in 1991 illustrates this
activity:
Do
you have advanced/privileged
information of any type of project/contract
that is going to be carried out
in your country? We hold commission/agency
agreements with many large European
companies and could introduce
them to your project/contract.
Any commission received would
be shared with yourselves.
The
ad
was
followed
by
a
phone
number
in
Western
Europe.
Some
countries
frequently
hire
well-connected
consultants
to
write
reports
on
topics
of
interest
and
to
lobby
US
Government
officials
on
the
country's
behalf.
Often,
the
consultants
are
former
high-ranking
US
Government
officials
who
maintain
contacts
with
their
former
colleagues.
They
exploit
these
connections
and
contract
relationships
to
acquire
protected
information
and
to
gain
access
to
other
high-level
officials
who
are
currently
holding
positions
of
authority
through
whom
they
attempt
to
further
acquire
protected
information.
Fulfillment
of Classified US Government Contracts
and Exploitation of DOD-Sponsored
Technology Sharing Agreements.
At times, classified US Government
contracts are awarded to companies
that are partially or substantially
controlled by a foreign government.
Although US Government security
agencies closely monitor these
contracts, they can still provide
foreign governments unauthorized
access to information. Traditional
allies of the United States are
most likely to use this method,
since non-allies seldom are included
in such contracts.
Tasking
Liaison Officers at Government-to
government Projects.
During joint R&D
activities. foreign governments
routinely request to have an
onsite liaison officer to monitor
progress and provide guidance.
Several allied countries have
taken advantage of these positions
as cover tor intelligence officers
assigned with collecting as much
information about the facility
as possible. Using their close
access to their US counterparts
conducting joint R&D,
particularly in the defense arena,
liaison officers have been caught
removing documents that are clearly
marked as restricted or classified.
