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Security Clearances: Consideration of Sexual Orientation in the Clearance Process

(Letter Report, 03/24/95, GAO/NSIAD-95-21)



Pursuant to a congressional request, GAO reviewed how sexual orientation
is treated in the security clearance process for federal civilian and
contractor employees, focusing on: (1) whether clearances are currently
being denied or revoked based on individuals' sexual orientation; (2)
whether sexual orientation is being used as a criterion in granting or
revoking security clearances; and (3) how concealment of sexual
orientation affects the granting or revoking of security clearances.

GAO found that: (1) problems related to sexual orientation appear to be
declining; (2) a review of selected cases from fiscal year 1993 showed
that sexual orientation was not a factor in denials, revocations, or
suspensions of security clearances; (3) the Department of Defense (DOD)
and the Secret Service have stated that sexual orientation is not a
criterion in granting security clearances, but they have not yet revised
their investigative policies and procedures; and (4) no clear linkage
exists between sexual orientation and espionage.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-95-21
     TITLE:  Security Clearances: Consideration of Sexual Orientation in 
             the Clearance Process
      DATE:  03/24/95
   SUBJECT:  Homosexuality
             Civil service appointments
             Employment discrimination
             Civilian employees
             Contractor personnel
             Department of Defense contractors
             Personnel management
             Hiring policies
             Civil rights
             Investigations by federal agencies

             
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Cover
================================================================ COVER


Report to Congressional Requesters

March 1995

SECURITY CLEARANCES -
CONSIDERATION OF SEXUAL
ORIENTATION IN THE CLEARANCE
PROCESS

GAO/NSIAD-95-21

Security Clearances


Abbreviations
=============================================================== ABBREV

  CIA - Central Intelligence Agency
  DISCR - Defense Industrial Security Clearance Agency
  DMA - Defense Mapping Agency
  DOD - Department of Defense
  FBI - Federal Bureau of Investigation
  OPM - Office of Personnel Management
  USIA - United States Information Agency

Letter
=============================================================== LETTER


B-258273

March 24, 1995

The Honorable George E.  Brown, Jr.
Ranking Minority Member
Committee on Science
House of Representatives

The Honorable Ronald V.  Dellums
Ranking Minority Member
Committee on National Security
House of Representatives

In response to your request and that of the former Chairman, House
Subcommittee on Civil and Constitutional Rights, Committee on the
Judiciary, we reviewed issues relating to how sexual orientation is
treated in the security clearance process for federal civilian and
contractor employees.  Specific areas we reviewed included (1)
whether clearances are currently being denied or revoked based on
individuals' sexual orientation, (2) whether sexual orientation is
being used as a criterion in granting or revoking security
clearances, and (3) how concealment of sexual orientation affects the
granting or revoking of security clearances.  We performed our review
at eight agencies that, except for the Central Intelligence Agency,
accounted for over 95 percent of the security clearances granted to
civilian and contractor employees during fiscal year 1993.  As
agreed, we did not review security clearances at the Central
Intelligence Agency, Defense Intelligence Agency, or National
Security Agency.  Also, the scope of this work did not include
military personnel; however, our prior work has addressed policies in
that area.\1


--------------------
\1 Defense Force Management:  DOD's Policy on Homosexuality
(GAO/NSIAD-92-98, June 12, 1992); Defense Force Management: 
Statistics Related to DOD's Policy on Homosexuality
(GAO/NSIAD-92-98S, June 12, 1992); and Homosexuals in the Military: 
Policies and Practices of Foreign Countries (GAO/NSIAD-93-215, June
25, 1993). 


   BACKGROUND
------------------------------------------------------------ Letter :1

The federal government is charged with determining who can be
entrusted with the nation's secrets.  Currently, 52 federal agencies
have granted personnel security clearances to over 206,000 civilian
and contractor employees.  The requirement for federal employees who
handle classified information to be loyal and trustworthy was an
outgrowth of a 1947 federal loyalty program, established by President
Truman during a time of heightened feelings of national security over
growing concerns about the communist threat.\2 Executive Order 10450
modified the loyalty program in 1953, requiring that any individual's
employment be "clearly consistent with the interests of the national
security," and for the first time included sexual perversion as a
basis for removal from the federal service.  Executive Order 10450,
which provides the basic security standards for agencies to follow,
has been amended several times through the years, most recently in
1974, but the security standards have remained basically the same. 
Appendix I contains the security standards in Executive Order 10450. 

Federal agencies used the sexual perversion criteria in the early
1950s to categorize homosexuals as security risks and separate them
from government service.  Agencies could deny homosexual men and
women employment because of their sexual orientation until 1975, when
the Civil Service Commission issued guidelines prohibiting the
government from denying employment on the basis of sexual
orientation.\3 The guidelines, which further define the provisions of
Executive Order 10450, resulted from court decisions requiring that
persons not be disqualified from federal employment solely on the
basis of homosexual conduct.  Although the public policy change
resulted in the restrictions against employment of homosexuals being
lifted, the guidance for granting security clearances to homosexuals
remained generally vague or restrictive until the early 1990s. 
Appendix II contains a synopsis of key court decisions pertaining to
sexual orientation and the security clearance process. 


--------------------
\2 Executive Order 9835, "Prescribing Procedures for the
Administration of an Employees Loyalty Program in the Executive
Branch of the Government" (Mar.  21, 1947). 

\3 The Civil Service Commission is now the Office of Personnel
Management (OPM).  As a result of legal actions, the Commission
initially issued suitability guidelines for federal government
employment in Federal Personnel Manual letter 731-3 (July 3, 1975). 
In May 1980, OPM issued a memorandum to heads of departments and
independent establishments clarifying that personnel actions based on
non-job-related conduct such as sexual orientation may be considered
prohibited personnel practices under 5 U.S.C.  2302(b).  The policy
was reaffirmed in February 1994. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :2

Until about 1991, when agencies began to change their security
policies and practices regarding sexual orientation, there were a
number of documented cases where defense civilian or contractor
employees' security clearances were denied or revoked because of
their sexual orientation.  However, our review of various records at
eight agencies and outreach to members of the homosexual community
have not identified such cases since 1991.  Since no overall database
of such information exists, our work was based on judgmentally
selected reviews of agencies' records and information solicited from
parties involved in the process.  We also recognize there is the
possibility that some individuals who have experienced problems would
be unwilling to come forward and discuss their cases. 
Notwithstanding these limitations, our work disclosed no evidence
that sexual orientation has been used as a criterion in the security
clearance process for federal civilian and contractor employees since
1991.  However, some individuals we spoke with believed they were
asked inappropriate questions during the clearance process. 

Information we received from homosexuals, gay and lesbian groups, and
attorneys who have experience with the security clearance process
confirms that clearances have not been recently denied because of
sexual orientation and that the number of problems experienced by
homosexuals has diminished in recent years.  In addition, our
detailed review of selected security clearance denials, revocations,
and suspensions during fiscal year 1993 showed that none were
attributable to sexual orientation. 

All eight agencies we reviewed told us that homosexuality is not a
criterion in granting security clearances.\4 Six of the eight
agencies have written policies and procedures that prohibit direct
questions about an applicant's sexual orientation and the denial of a
security clearance on the basis of sexual orientation alone. 
Although the other two agencies-- DOD and the U.S.  Secret
Service--told us sexual orientation is not a criterion, they have not
revised their written policies and procedures to reflect this
position.  Under their existing policies and procedures,
investigators are authorized to pursue information regarding an
applicant's homosexuality.  Secret Service procedures require
investigators to be alert to and thoroughly investigate allegations
of homosexual conduct.  DOD investigators can ask questions about
sexual orientation once it has been established that an applicant is
homosexual. 

All of the agencies in our review indicated that concealment of any
personal behavior that could result in exploitation, blackmail, or
coercion is a security concern.  However, the treatment of
concealment as it relates to sexual orientation varies.  Although
most of the agencies have eliminated specific references to sexual
orientation, DOD and FBI guidelines treat concealment as a security
concern.  At DOD, coworkers and family members must be informed of
the applicant's sexual orientation, or the applicant is considered
potentially vulnerable to blackmail or coercion and could be denied a
clearance.  DOD plans to eliminate this language in revised
guidelines to be issued in early 1995. 

The FBI's investigative guidelines on sexual orientation require
investigators to record admissions of sexual orientation for use in
determining an applicant's vulnerability to compromise.  The FBI
explained that this requirement is intended to provide investigators
precise guidance on how to handle sexual orientation, and that the
guidelines also state that no inference of susceptibility to coercion
is to be drawn based on sexual orientation.  We believe the inclusion
of the requirement in the investigative guidelines could be
misinterpreted to suggest that a person is vulnerable to compromise
only because of the individual's sexual orientation.  In addition,
none of the other agencies in our review have a similar requirement. 


--------------------
\4 The agencies we reviewed were the Department of Defense (DOD), the
Departments of Energy and State, OPM, the U.S.  Information Agency
(USIA), the Federal Bureau of Investigation (FBI), the U.S.  Secret
Service, and the U.S.  Customs Service. 


   PROBLEMS RELATED TO SEXUAL
   ORIENTATION APPEAR TO BE
   DECLINING
------------------------------------------------------------ Letter :3

No central source of data exists that captures incidents where
individuals believe their security clearance was denied or revoked
because of their sexual orientation.  Therefore, we reached out to
individuals who believed their sexual orientation influenced the
security clearance process.  Specifically, we asked over 30 gay and
lesbian publications throughout the United States to publish an
article soliciting input from individuals who believe federal
agencies denied or revoked their security clearances based on their
sexual orientation between 1991 and 1994.  We also contacted nine
attorneys and one paralegal who represented individuals on gay rights
issues.  In addition, we talked with representatives from five gay
rights organizations that represent federal employees and other
professionals who might have sought a security clearance. 

We recognize that some individuals who have experienced problems with
the security clearance process might not be willing to contact us,
but the information we received, and the individuals with whom we
talked, generally indicated that in recent years (between 1991 and
1994) sexual orientation has not been used as a criterion for denying
security clearances.  The attorneys told us that they have had no
sexual orientation cases associated with security clearances since
1992.  The paralegal also had no cases, but said there is not parity
between questions asked of homosexuals versus heterosexuals (e.g.,
homosexuals are often asked detailed questions about their sexual
habits).  The National Organization of Gay and Lesbian Scientists and
Technical Professionals, Pasadena, California, believes that
improvements have been made and the problems are not nearly as severe
as in the past, but they are concerned that the process for obtaining
clearances appears to take longer for homosexual than heterosexual
employees.  Appendix III identifies some of the major organizations
we contacted. 

Based on information from the above sources, we identified 25 cases
where civilian or contractor employees believed their sexual
orientation had an impact on their security clearance investigations. 
Nine of the
25 cases occurred after 1990:  3 in 1991, 5 in 1992, and 1 in 1993. 
None of these cases involved a denial, revocation, or suspension of a
security clearance.  However, the individuals believed that the
investigation took longer than it should have or that the
investigators asked unnecessary questions about the individuals'
sexual behavior.  No incidents were reported to us for January
through November 1994. 

Of the 16 cases that occurred before 1991, 8 clearances were revoked. 
Five of the eight individuals were defense contractor employees who
either omitted disclosing homosexual activities to defense
investigators, did not disclose their homosexuality to family members
and coworkers (a defense personnel security requirement), or
fraternized with foreign nationals.\5 The other three included one
defense and two foreign service employees at the Department of State
and USIA.  Their clearances were revoked for medical health reasons,
and fraternizing with foreign nationals and/or criminal behavior. 
The five defense contractor personnel appealed the revocation, and
three of the clearances were reinstated.\6 Clearances were not
revoked or denied for the other eight cases that occurred before
1991; however, the individuals believed they were asked inappropriate
questions during the clearance process.  In summary, for the eight
cases we reviewed where a clearance was revoked, it appears that the
individuals' clearances were not revoked because of sexual
orientation, per se, but rather for the concealment of it. 


--------------------
\5 Fraternization is a relationship with a foreign national that
involves close, romantic, or sexual ties. 

\6 One of the three clearances was revoked by one agency but
reinstated by another agency when the individual transferred. 


   SELECTED FISCAL YEAR 1993 CASE
   REVIEW SHOWS SEXUAL ORIENTATION
   WAS NOT A FACTOR IN DENIALS,
   REVOCATIONS, OR SUSPENSIONS
------------------------------------------------------------ Letter :4

In addition to our outreach effort to homosexual individuals, we
judgmentally selected and reviewed 129 cases where clearances were
denied, revoked, or suspended.  Our objective was to see if we could
find any evidence that sexual orientation was a factor in these
decisions.  Our detailed review showed that no clearances were
denied, revoked, or suspended because of sexual orientation.  Also, a
limited review of interviewee follow-up information showed similar
results. 

During fiscal year 1993, the eight agencies included in our study
denied, revoked, or suspended security clearances for 2,526
individuals.  We collected data from each agency on the reason for
the adverse action and reviewed 129 cases in detail to determine
whether sexual orientation was a criterion in the clearance
determination.  Our detailed review showed that no clearances were
denied, revoked, or suspended because of sexual orientation.  In nine
cases, sexual conduct--not sexual orientation--appeared to be a key
factor in the adverse action.  There was no indication that the
individuals were homosexual or that sexual orientation was an issue. 
The other 120 clearances were denied, revoked, or suspended for a
number of reasons, including alcohol and drug abuse, mental or
medical health issues, and security violations. 

Table 1 shows the number of denials, revocations, and suspensions by
agency, and table 2 shows the reason for the adverse action as
reported to us by each agency for the 129 cases we reviewed in
detail. 



                           Table 1
           
            Number of Security Clearances Denied,
            Revoked, or Suspended for Fiscal Year
                             1993

Agency
------------------------------------------------------  ====
DOD                                                     1,94
                                                         5\a
Energy                                                   509
FBI                                                       11
OPM                                                       13
State                                                     21
Secret Service                                             2
USIA                                                       9
Customs                                                   16
============================================================
Total                                                   2,52
                                                           6
------------------------------------------------------------
\a DOD records show that the Army, Navy, and Air Force accounted for
954 of the denials, revocations, and suspensions; Defense Mapping
Agency (DMA) for 52; Defense Logistics Agency for 20; and 7 other
defense organizations for 18.  Civilians working for defense
contractors accounted for the remaining 901. 



                                     Table 2
                     
                      Security Factors Cited by Agencies for
                      the Cases Reviewed by GAO (Fiscal Year
                                      1993)


                                                  Secret
Security  Custom                                  Servic
factors        s     DMA  Energy     FBI     OPM       e   State    USIA   Total
--------  ------  ------  ------  ------  ------  ------  ------  ------  ======
Alcohol/              15                                       4              19
 drug
 abuse
Counteri                               3                       1       1       5
 ntellig
 ence/
 nationa
 l
 interes
 t/
 falsifi
 cation
 of
 informa
 tion
Criminal       4       8                                       7              19
 /
 notorio
 us
 conduct
Failure        2                                                               2
 to
 update
 securit
 y forms
Falsific                               2                               3       5
 ation
 of
 informa
 tion
Fraud/         1       3                                               1       5
 falsifi
 cation/
 financi
 al
 matters
Falsific               2               1               1                       4
 ation/
 mental
 or
 medical
 health/
 alcohol
 /drugs
Falsific                       1                                       1
 ation/
 securit
 y
 violati
 on
Integrit       7                                                               7
 y
 investi
 gations
Mental/        1       4                                       4       2      11
 medical
 health
National                               1                                       1
 interes
 t/
 securit
 y
 violati
 ons
Refusal                                1                                       1
 to
 submit
 to
 polygra
 ph
Security       1                       2                       4       1       8
 violati
 ons
Terminat                                      13                              13
 ion/
 transfe
 r/no
 clearan
 ce
 needed
Unusual                        6                                               6
 conduct/
 sexual
 activit
 y
Sexual                 2                               1                       3
 miscond
 uct
Sexual                 1                                                       1
 miscond
 uct/
 drugs/
 falsifi
 cation
Financia              14                                       1              15
 l
 matters
Unauthor               3                                                       3
 ized
 absence
================================================================================
Total         16      52       6      11      13       2      21       8     129
--------------------------------------------------------------------------------
Note:  We reviewed files at DMA because initially, more people from
DMA contacted us than from the military services. 


      INVESTIGATIVE QUALITY
      ASSURANCE FOLLOW-UP RESULTS
---------------------------------------------------------- Letter :4.1

In an effort to ensure that investigators are asking appropriate
questions and behaving in a professional manner, four of the eight
agencies in our review (DOD, State, OPM, and USIA) send follow-up
letters to randomly selected security clearance applicants and third
parties who were interviewed during background investigations.  As
another means to determine if agencies use sexual orientation as a
security factor, we examined a small, nonstatistical sample of 41
investigator follow-up letters from the 2,100 DOD, State, and USIA
sent in 1993 and 1994.  We also reviewed the summary results of an
OPM project that included feedback from over 800 interviewees.\7
There was no indication on the follow-up responses we examined, or in
OPM's project results, of any discrimination or inappropriate
behavior--for example, failure to ask clear and direct questions on
topics the interviewee would consider important to a security
investigation--by the investigators. 


--------------------
\7 "Summary of Quality Control Reinterview Project" (Dec.  11, 1992). 


   PROCEDURES AT TWO AGENCIES DO
   NOT REFLECT STATED POLICIES ON
   SEXUAL ORIENTATION
------------------------------------------------------------ Letter :5

Excluding the Central Intelligence Agency, the eight agencies we
reviewed accounted for over 95 percent of the security clearances
granted to civilian and contractor employees during fiscal year 1993. 
All of the agencies told us that sexual orientation is not a
criterion in granting security clearances.  As shown in table 3, six
of the eight agencies have written policies and procedures that
prohibit direct questions about an applicant's sexual orientation and
the denial of a security clearance on the basis of sexual orientation
alone.  Secret Service and DOD, however, have not yet revised their
written policies and procedures to reflect this position.  Under
these two agencies' policies and procedures, investigators are
authorized to pursue information regarding an applicant's
homosexuality.  Secret Service procedures require investigators to be
alert to and thoroughly investigate allegations of homosexual
conduct.  DOD investigators can ask questions about sexual
orientation once it has been established that an applicant is
homosexual. 

Secret Service officials told us they were not aware of the provision
in their regulations and that they plan to revise their policies and
procedures in the near future.  DOD officials also told us they plan
to revise their security manual.  In commenting on our draft report,
DOD noted that it has drafted revised adjudication guidelines and
recently issued revised investigative procedures.  However, we note
that the guidelines and procedures may be inconsistent since the
adjudication guidelines focus on sexual misconduct and the
investigative procedures focus on orientation. 



                                     Table 3
                     
                       Synopsis of Agency Investigative and
                     Adjudicative Policies and Procedures on
                                Sexual Orientation

                                                     Investigative and
Agency                  Sexual orientation policy    adjudicative procedures
----------------------  ---------------------------  ---------------------------
DOD                     December 1993 Memorandum on  1993 Defense Investigative
                        Changes to Defense           Service Manual for
                        Investigative Manual--       Personnel Security
                        Sexual Conduct               Investigations

                        No investigations or         These procedures are
                        inquiries will be conducted  applicable to
                        solely to determine a        investigations of civilian
                        subject's sexual             and contractor personnel.
                        orientation. Investigators   Under certain circumstances
                        are not to ask direct        (e.g., when sexual acts,
                        questions about sexual       conduct, or behavior
                        orientation unless           include acts performed with
                        credible, relevant           a minor, involving
                        information has been         coercion, force, or
                        developed from other         violence, or acts committed
                        sources. Investigators       for money), investigators
                        should not ask questions     can expand an
                        unless the individual        investigation, but
                        introduces the matter or it  investigations or inquiries
                        is developed through other   will not be conducted
                        sources.                     solely to determine an
                                                     individual's sexual
                                                     orientation.

                        DOD 5200.2-R, Personnel      Allegations of an
                        Security Program, January    individual's sexual conduct
                        1987                         should be designed to
                                                     elicit information that
                        Family members and           adjudicative authorities
                        coworkers must be informed   consider in accordance with
                        of an individual's sexual    clearance denial criteria.
                        orientation. Concealment of  DOD's current definition of
                        sexual preference from an    "moral behavior" includes
                        employer, coworkers, or      sexual conduct, which may
                        family members could         or may not be technically
                        disqualify an individual     illegal in any given
                        from obtaining a security    jurisdiction. (Officials
                        clearance.                   told us investigators no
                                                     longer use this
                                                     definition.)

                        Note: This process appears   DOD 5200.2-R, Personnel
                        to be inconsistent with DOD  Security Program, January
                        policy to not use sexual     1987
                        orientation as a security
                        criterion, and to not ask    These procedures are
                        questions about sexual       applicable to civilian
                        orientation.                 personnel. Disqualifying
                                                     factors: conduct or actions
                                                     that increase the
                                                     individual's vulnerability
                                                     to coercion or blackmail,
                                                     including concealment of
                                                     sexual preference from
                                                     immediate family members,
                                                     close associates,
                                                     supervisors, or coworkers.

                                                     Draft Adjudicative
                                                     Guidelines for Determining
                                                     Eligibility for Access to
                                                     Classified Information

                                                     Note: These procedures will
                                                     be applicable to civilian
                                                     and contractor personnel
                                                     and are scheduled to
                                                     replace 5200.2-R. Sexual
                                                     behavior is a security
                                                     concern if it involves a
                                                     criminal offense, indicates
                                                     a personality or emotional
                                                     disorder, subjects the
                                                     individual to undue
                                                     influence or coercion, or
                                                     reflects lack of judgment
                                                     or discretion. Conditions
                                                     that signal security
                                                     concern include sexual
                                                     behavior that causes an
                                                     individual to be vulnerable
                                                     to undue influence or
                                                     coercion. Defense officials
                                                     told us that homosexual
                                                     behavior could cause an
                                                     individual to be vulnerable
                                                     to undue influence or
                                                     coercion.

DOD (cont.)                                          1992 Directive 5220.6,
                                                     Defense Industrial
                                                     Personnel Security
                                                     Clearance Review Program

                                                     This directive implements
                                                     Executive Order 10865,
                                                     Safeguarding Classified
                                                     Information Within
                                                     Industry, which describes
                                                     appeal procedures for
                                                     contractor employees and
                                                     contains security standards
                                                     from DOD regulation 5200.2-
                                                     R, which are applicable to
                                                     contractor and civilian
                                                     employees.

Department of Energy    1993 Adjudicative            1993 Adjudicative
                        Guidelines for Determining   Guidelines for Determining
                        Eligibility for Access to    Eligibility for Access to
                        Classified Matter and/or     Classified Matter and/or
                        Special Nuclear Material     Special Nuclear Material;
                                                     and Title 10 Code of
                                                     Federal Regulations, Part
                                                     710

                        Engaging in homosexual       Note: OPM conducts
                        activity is not cause for    investigations for the
                        security concern unless      Department of Energy.
                        there is a clear indication  Therefore, Energy has no
                        that such activity involved  investigative guidelines.
                        a criminal act or a lack of
                        judgment or discretion.      Consensual sexual acts
                        Individuals will not be      between adults, conducted
                        subject to further security  in privacy, are not subject
                        review merely due to the     to security concern unless
                        fact that they engage in     the adjudicator believes
                        homosexual activity.         extenuating circumstances
                                                     are involved.

                                                     Derogatory information
                                                     includes those cases in
                                                     which the individual has
                                                     engaged in unusual conduct
                                                     or is subject to
                                                     circumstances that tend to
                                                     show the individual is not
                                                     honest, reliable, and
                                                     trustworthy, and there is
                                                     no adequate evidence of
                                                     rehabilitation or
                                                     reformation or that furnish
                                                     reason to believe the
                                                     individual may be subject
                                                     to coercion, influence, or
                                                     pressure that may cause the
                                                     individual to act contrary
                                                     to the best interests of
                                                     the national security.

FBI                     Background Investigations    Background Investigations
                        Policy/Guidelines Regarding  Policy/Guidelines Regarding
                        Sexual Orientation (Mar. 2,  Sexual Orientation (Mar. 2,
                        1994)                        1994)

                        No person, as a condition    Note: Where an applicant/
                        of submitting an             candidate volunteers
                        application for employment   information concerning his/
                        or as a condition of         her sexual orientation or
                        federal employment, may be   preference during the
                        asked to declare his or her  course of a background
                        sexual orientation or        investigation, it should be
                        preference. Homosexuality    recorded for use in
                        does not create an           determining the person's
                        inference of unsuitability   vulnerability to
                        for security clearance or    compromise.
                        access to sensitive
                        information. (See also       Concealed matters in a
                        Department of Justice        person's life may be the
                        policy.                      basis for attempted
                                                     pressure or influence and
                                                     the concealment of the
                                                     activity or conduct may be
                                                     more important in
                                                     determining trustworthiness
                                                     than the conduct or
                                                     activity itself.

<h1xp> OPM              OPM adopted the Department   Draft OPM Manual 732-1,
                        of Justice's 1993 policy to  Subchapter 5, Security
                        not discriminate on the      Adjudication, and 736-1,
                        basis of sexual              Personnel Investigations
                        orientation.

                        Department of Justice        Federal personnel
                        Statement of Policy With     investigators are not
                        Respect to                   authorized to interview
                        Nondiscrimination in         applicants or appointees
                        Employment (Dec. 2, 1993)    concerning their sexual
                                                     behavior or attitudes
                        In the context of            concerning sexual conduct
                        determining eligibility for  in the absence of
                        security clearances or       allegations or information
                        access to sensitive          indicating sexual behavior
                        information, the Department  that would have a bearing
                        may investigate and          on efficient service in the
                        consider any matter that     position in question, or
                        would reasonably subject     would interfere with or
                        the applicant or employee    prevent effective
                        to coercion, but no          performance by the
                        inference concerning         employing agency of its
                        susceptibility to coercion   duties and
                        may be raised solely on the  responsibilities.
                        basis of the race, color,
                        religion, sex, national      Note: In commenting on a
                        origin, disability, or       draft of this report, OPM
                        sexual orientation of the    indicated that subchapter 5
                        applicant or employee.       of Draft OPM Manual 732-1
                                                     has been abolished and
                                                     chapter 736-1 will be
                                                     retained until December
                                                     1994.

                                                     April 1992 OPM
                                                     Investigator's Handbook

                                                     The handbook has no
                                                     specific language regarding
                                                     sexual orientation.
                                                     Regarding personal conduct,
                                                     investigators are
                                                     instructed to ask: "Is
                                                     there anything in your
                                                     background or personal
                                                     conduct that could result
                                                     in exploitation, blackmail,
                                                     or coercion?" If, during
                                                     the course of the
                                                     interview, the subject
                                                     brings up any aspect of
                                                     personal conduct that
                                                     appears questionable, the
                                                     investigator may ask direct
                                                     questions and develop the
                                                     basic facts and the extent
                                                     to which they are known to
                                                     others.

                                                     Note: In commenting on a
                                                     draft of this report, OPM
                                                     indicated that the
                                                     Investigator's Handbook is
                                                     being revised and that the
                                                     investigative procedures
                                                     noted above are no longer
                                                     accurate. OPM noted that
                                                     its investigators are not
                                                     authorized to question
                                                     applicants or appointees
                                                     concerning their sexual
                                                     behavior or attitudes
                                                     concerning sexual conduct,
                                                     but are authorized to
                                                     report information received
                                                     that may be of value to an
                                                     agency adjudicator as
                                                     bearing on the individual's
                                                     efficient service in a
                                                     position or an agency's
                                                     ability to perform its
                                                     duties and responsibilities
                                                     effectively.

Department of State     Diplomatic Security          1993 Policy Memorandum, 12
                        Memorandum on Sexual         Foreign Affairs Manual 230,
                        Conduct Policy (Dec. 10,     on Personnel Security, and
                        1992)                        Adjudicative Guidelines

                        Investigators will not       Note: Allegations of
                        pursue issues of sexual      potentially exploitable
                        conduct.                     conduct will be referred to
                                                     headquarters security
                        One's sexual orientation,    personnel for review.
                        per se, does not constitute  Sexual conduct is a
                        a basis for denial of        security concern if it
                        security clearance.          involves a criminal
                                                     offense, indicates a
                                                     personality disorder,
                                                     subjects the individual to
                                                     undue influence or
                                                     coercion, or reflects lack
                                                     of judgment or discretion.

Secret Service          Secret Service has no        1983 Secret Service
                        written policy, but          Investigative Manual
                        according to Secret Service
                        officials, investigators     Note: Investigators must be
                        should not ask questions     alert to information
                        about sexual orientation.    concerning an applicant's
                        Officials told us they plan  homosexual conduct or
                        to publish written policies  sexual perversion(s).
                        and procedures upon          Allegations of homosexual
                        publication of Treasury      conduct or sexual
                        Department guidelines.       perversion must be
                                                     completely investigated.
                                                     The purpose of the
                                                     investigation is to
                                                     ascertain whether the
                                                     individual's possible
                                                     homosexual conduct or
                                                     sexual perversions may be
                                                     indicative of a personality
                                                     disorder or make the
                                                     individual subject to
                                                     blackmail or coercion. This
                                                     process appears to be
                                                     inconsistent with Secret
                                                     Service policy to not ask
                                                     questions about sexual
                                                     orientation.

USIA                    1993 USIA manuals on         1993 USIA manuals on
                        Conduct of the Background    Conduct of the Background
                        Investigation and            Investigation, and
                        Guidelines for Making        Guidelines for Making
                        Security Determinations      Security Determinations

                        Investigators are            Note: If a third party,
                        prohibited from inquiring    during the course of the
                        into a subject's sexual      investigation, volunteers
                        orientation. Sexual conduct  information about the
                        is of concern only to the    individual being
                        extent that there is reason  investigated, investigators
                        to believe the individual    are not to pursue the issue
                        may be vulnerable to         other than through routine
                        coercion or has violated     questioning regarding the
                        laws or security and other   individual's character,
                        federal regulations.         reputation, and conduct.

U.S. Customs Service    Follows OPM guidance to not  1985: Customs Policies and
                        ask direct questions on      Procedures Manual
                        sexual orientation.
                                                     Note: The manual contains
                                                     no specific language on
                                                     sexual orientation with
                                                     regard to granting or
                                                     revoking security
                                                     clearances. The Customs
                                                     manual provides specific
                                                     guidance with regard to
                                                     suitability issues, but not
                                                     security clearance issues,
                                                     per se.
--------------------------------------------------------------------------------

      AGENCIES' POLICIES AND
      PROCEDURES DIFFER ON
      CONCEALMENT OF SEXUAL
      ORIENTATION
---------------------------------------------------------- Letter :5.1

All the agencies in our review indicated that concealment of any
personal behavior that could result in exploitation, blackmail, or
coercion is a security concern.  However, the treatment of
concealment, as it relates to sexual orientation, varies. 

Most of the agencies have eliminated references to concealment of
sexual orientation, per se, as a security factor.  However, under DOD
adjudicative procedures, individuals can be denied a clearance if
they conceal their homosexuality from their employer, family members,
or coworkers.\8 Officials told us that individuals who fail to
disclose their homosexuality could be subject to coercion or
blackmail.  This creates a dilemma for homosexual employees who do
not wish to share their orientation with others.  On the one hand,
individuals need not volunteer information about their sexual
orientation.  On the other hand, if individuals do not volunteer the
information, they could be denied a clearance for concealing their
sexual orientation.  DOD has drafted new adjudicative guidance that
eliminates specific reference to concealment, and it intends to
review its procedures by April 1995 to ensure that sexual orientation
is not an issue in the investigation or adjudication of security
clearances. 

DOD officials told us that there were no recent examples where the
concealment provision was used to deny or revoke a security
clearance, but one of the attorneys we contacted referred us to three
cases that occurred in the mid-1980s.  In these cases, the security
clearances were revoked but later reinstated through the appeals
process.  Secret Service investigative procedures are similar to
DOD's in that investigators can pursue information related to
concealment to ascertain whether an individual may be susceptible to
blackmail or coercion. 

The FBI's guidelines regarding the issue of sexual orientation in
background investigations were established in March 1994.  According
to FBI officials, the guidelines are intended to prevent
discrimination based on sexual orientation and were developed to
implement the Attorney General's policy statement regarding
nondiscrimination and to comply with a December 1993 court-approved
settlement agreement on discrimination.\9 Although the guidelines are
generally consistent with Justice and FBI policies regarding sexual
orientation, the guidelines contain some language that could be
misinterpreted. 

Specifically, the FBI guidelines on sexual orientation require
investigators to inform applicants that the concealment of an
activity or conduct may be more important in determining suitability
and trustworthiness than the conduct or activity itself, that candor
and forthrightness are significant considerations of FBI employment,
and a lack of candor may disqualify the candidate from employment
even when the underlying activity or conduct might not.  The
guidelines further require investigators to document the fact that
the information about concealment and candor was provided to the
applicant, and that it, together with the applicant's response, be
appropriately recorded in the applicant's file. 

The FBI guidelines on sexual orientation also require that
investigators record admissions of sexual orientation for use in
determining an applicant's vulnerability to compromise.  FBI
officials explained that this requirement is intended to provide
investigators precise guidance on how to handle sexual orientation,
and noted that the guidelines also state that no inference of
susceptibility to coercion is to be drawn based on sexual
orientation.  We found no recent examples where the FBI has drawn
such an inference.  However, including this requirement in the
investigative guidelines could be misinterpreted to suggest that a
person is vulnerable to compromise only because of the individual's
sexual orientation.  In addition, none of the other agencies in our
review have a similar requirement. 

Specifically, with the exception of DOD, the agencies in our review
have eliminated references to concealment of sexual orientation as a
security concern, and DOD stated it intends to do so.  For example,
OPM's adjudicative procedures and investigator's handbook contain no
specific references to concealment of sexual orientation.  Similarly,
the State Department's adjudicative guidelines focus on concealment
of sexual conduct without regard to orientation.  In commenting on
our draft report, State indicated that security concerns raised by
allegations relating to an individual's sexual conduct are directed
toward other appropriate criteria, such as criminal conduct,
mental/emotional health, vulnerability to foreign influence or
coercion, or lack of judgment or discretion. 


--------------------
\8 In commenting on a draft of this report, DOD noted that its
revised adjudication guidelines, developed in conjunction with the
Intelligence Community, have deleted this provision. 

\9 Buttino v.  FBI, 801 F.  Supp.  298 (1993). 


   NO CLEAR LINKAGE EXISTS BETWEEN
   SEXUAL ORIENTATION AND
   ESPIONAGE
------------------------------------------------------------ Letter :6

No one knows how many federal workers are homosexual or how many
homosexuals hold security clearances, but sexual orientation seems to
have little bearing on the motives behind acts of espionage.  A 1991
study by the Defense Personnel Security Research Center\10 concluded
there is little evidence to suggest that homosexuals are security
risks.\11 Six of the center's 117 recorded espionage cases between
1945 and 1991 involved homosexuals.  In these six cases, the study
found that fear of having one's homosexuality disclosed was not the
motive for disclosing the nation's secrets.  Instead, the motives
appeared to be the same as in most espionage cases:  primarily money
and secondarily resentment.  All volunteered to provide national
security information except one, who was recruited as an accomplice
by a heterosexual friend. 

According to another defense organization, the DOD Security
Institute,\12 sexual orientation was an issue in one 1992 espionage
case that involved a homosexual employee who sold national secrets to
East German foreign intelligence agents.  According to the Institute,
homosexuality was just one of many emotional issues the East Germans
used to manipulate the employee.  The individual was also depressed,
lonely, and had difficulty with interpersonal relations and other
problems. 


--------------------
\10 The Defense Personnel Security Research Center, under the
direction of the Assistant Secretary of Defense (Command, Control,
Communications, and Intelligence), is a research organization that
studies aspects of personnel security, including espionage.  Its
findings rest on the statistical analysis of quantitative data on a
large number of variables or indicators. 

\11 Defense Personnel Security Research and Education Center,
"Homosexuality and Personnel Security," Theodore R.  Sarbin (Sept. 
1991, PERS-TR-91-008), p.28. 

\12 The DOD Security Institute was established in 1986 by the
Secretary of Defense to serve as the focal point for promoting
activities supporting DOD security programs, particularly in the area
of education and training.  The institute provides security education
and training to DOD military and civilian personnel as well as
personnel from about 20 other federal agencies. 


   RECOMMENDATIONS
------------------------------------------------------------ Letter :7

We recommend that the

Secretary of Defense direct the Assistant Secretary of Defense
(Command, Control, Communications, and Intelligence) to modify DOD
investigative and adjudicative procedures to be consistent with
stated agency policies and to ensure that adjudication guidelines and
investigative procedures are consistent by focusing only on
conduct-related issues, rather than on sexual orientation;

Secretary of the Treasury direct the Secret Service's Assistant
Director for Investigations to modify the Service's investigative and
adjudicative procedures to be consistent with stated agency policies;
and

Attorney General direct the Director, FBI, to revise that Bureau's
investigative guidelines regarding sexual orientation to eliminate
the requirement that admissions of sexual orientation be recorded for
use in determining an applicant's vulnerability to compromise. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :8

The Departments of State and Energy, DOD, the Secret Service, OPM,
USIA, and the Customs Service agreed with the information presented
in a draft of this report.  DOD and the Secret Service concurred with
our recommendations.  DOD has drafted adjudication guidelines that
eliminate the requirement for an individual's family members to be
informed about the individual's homosexuality and focus on
conduct-related factors as a basis for security clearance actions. 
The Secret Service will determine procedures based on forthcoming
Treasury Department guidelines.  Several of the agencies provided
technical corrections that have been incorporated in the report. 

However, the Justice Department disagreed with our interpretation of
the FBI's sexual orientation guidelines and with our recommendation
that the FBI eliminate specific language in its guidelines regarding
sexual orientation.  According to Justice, FBI guidelines are
consistent with Justice policy and the dictates of Executive Order
10450.  Justice maintained that FBI guidelines limit consideration of
sexual orientation to circumstances in which sexual orientation could
reasonably be thought to raise an issue of susceptibility to
coercion.  Justice provided no examples of what these circumstances
might be. 

Justice stated that the FBI had agreed to issue a letter to its field
staff reaffirming and clarifying the investigations policy regarding
sexual orientation.  The FBI's December 1994 letter deals primarily
with guidelines for follow-up interviews with applicants when a third
party provides information about a potential vulnerability.  The
letter states that applicants should (1) not be asked to declare a
sexual orientation and should be reassured that the only potential
issue is susceptibility to coercion, (2) be told that another person
provided information about a potential susceptibility, and (3) be
asked whether, in fact, there is a vulnerability that was not
previously disclosed. 

We eliminated references in our draft report contrasting FBI
guidelines and Justice policy.  In addition, we have clarified
language in our draft report regarding the FBI requirement that
investigators record admissions of sexual orientation for use in
determining applicants' vulnerability to compromise. 

Our detailed comments supplementing those in the report text appear
at the end of appendixes V through XI. 


---------------------------------------------------------- Letter :8.1

To accomplish our objectives, we reviewed current investigative and
adjudicative policies, procedures, and practices at eight agencies. 
Collectively, these agencies accounted for over 95 percent of the
security clearances granted to civilian and contractor employees
during fiscal year 1993.  In addition, we obtained data on the number
of security clearances that were denied, revoked, or suspended during
fiscal year 1993 and reviewed a sample in detail to determine the
reason for the adverse action.  We also solicited input from
homosexuals, attorneys, and representatives of gay and lesbian groups
who had experience with the federal security clearance process.  We
conducted our review between August 1993 and November 1994 in
accordance with generally accepted government auditing standards. 
Our scope and methodology is described in detail in appendix III. 

We are sending copies of this report to the Chairmen, House
Committees on National Security, Appropriations, and Government
Reform and Oversight and Senate Committees on Armed Services,
Appropriations, and Government Affairs; the Secretaries of Defense,
Energy, State, and the Treasury; the U.S.  Attorney General; the
Directors of the FBI, OPM, USIA, Secret Service, and Office of
Management and Budget; and the Commissioner, U.S.  Customs Service. 
We will also make copies available to others upon request.  Please
call me on (202) 512-8412 if you or your staff have any questions. 
Other major contributors are listed in
appendix XII. 

Donna M.  Heivilin
Director, Defense Management
 and NASA Issues




(See figure in printed edition.)Appendix I
EXECUTIVE ORDER 10450 (AS AMENDED,
1974) SECURITY REQUIREMENTS FOR
GOVERNMENT EMPLOYMENT
============================================================== Letter 



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


SYNOPSIS OF LEGAL DECISIONS
AFFECTING THE EMPLOYMENT AND
SECURITY RIGHTS OF HOMOSEXUAL
EMPLOYEES
========================================================== Appendix II

Litigation has, in large part, exemplified the struggle to erase the
link between homosexuality and trustworthiness.  It has also driven
the development of current public policy on sexual orientation in the
security clearance process.  Some landmark cases are summarized
below. 


      NORTON V.  MACY (417 F.  2D
      1161 (D.C.  CIR.  1969))
------------------------------------------------------ Appendix II:0.1

The plaintiff engaged in homosexual conduct and was fired on grounds
of "immorality." The court ruled that alleged or proven immoral
conduct is not grounds for separation from public employment unless
it can be shown that such behavior has demonstrable effects on job
performance.  The court found that the notion that the federal
government could enforce the majority's conventional codes of conduct
in the private lives of its employees was inconsistent with the
elementary concepts of liberty, privacy, and diversity. 


      SOCIETY FOR INDIVIDUAL
      RIGHTS, INC., V.  HAMPTON,
      63 F.R.D.  399 (N.D.  CAL. 
      1973)
------------------------------------------------------ Appendix II:0.2

An organization of homosexual individuals and a discharged Civil
Service Commission employee brought action to challenge the
Commission's policy of excluding individuals who have engaged in
homosexual conduct from government employment.  The court found that
the Commission could discharge a person for immoral behavior only if
the behavior impaired the efficiency of the service, and that the
Commission had not met this standard.  The court ordered
reinstatement of the employee.  The Civil Service Commission amended
its regulations in 1976 and 1977 so that no person could be denied
federal employment on the basis of sexual orientation. 


      HIGH TECH GAYS V.  DISCO,
      668 F.  SUPP.  1361 (N.D. 
      CAL.  1987), CERT.  DENIED,
      895 F.  2D 563, 570-74
      (1990)
------------------------------------------------------ Appendix II:0.3

The case was filed in 1984 on behalf of an organization of Silicon
Valley, California, employees known as High Tech Gays.  Three members
of the group had been denied security clearances because of
Department of Defense procedures that, at that time, allowed security
investigations to be expanded when prospective employees were
identified as homosexual.  The court found the policy to be
prejudicial based on the unwarranted claim that homosexual men and
women were emotionally unstable and, therefore, potential targets for
blackmail. 

The Ninth Circuit Court of Appeals reversed the decision.  The court
argued that heightened or strict scrutiny could be applied only to
government actions that discriminated against persons based on such
things as race, gender, alienage, or national origin.  Further, the
opinion indicated that to be perceived as a suspect or quasi-suspect
class, homosexuals must meet three criteria:  (1) have suffered a
history of discrimination, (2) exhibit obvious or immutable
characteristics that define them as a discrete class, and (3) show
that they are a minority or politically powerless.  The court held
that the first criterion was met, but the second and third were not. 


      WEBSTER V.  DOE, 486 U.S. 
      592 (1988)
------------------------------------------------------ Appendix II:0.4

In 1982, John Doe, an employee of the Central Intelligence Agency
(CIA), voluntarily told an agency security officer that he was a
homosexual.  The CIA conducted an investigation that included a
polygraph examination designed to uncover whether Doe had disclosed
classified information.  Doe passed the test but was dismissed from
the agency as a national security risk.  The decision enabled Doe to
appeal to federal courts, but was silent regarding the treatment of
homosexuals as a suspect class. 


      BUTTINO V.  FBI, NO. 
      C-90-1639 SBA N.D.  CAL. 
      (1992)
------------------------------------------------------ Appendix II:0.5

The plaintiff was employed as a special agent with the Federal Bureau
of Investigation (FBI).  In August 1988, the FBI received an undated,
handwritten letter stating that the plaintiff engaged in homosexual
activity.  The FBI then initiated an administrative inquiry regarding
the plaintiff that resulted in the FBI's revoking the plaintiff's
security clearance.  The plaintiff brought action against the FBI and
its director alleging deprivation of constitutional rights. 

In 1994, under the terms of a settlement agreement, the FBI
established guidelines for conducting background investigations,
employment determinations, and security clearance adjudications
intended to prevent discrimination based on sexual orientation. 


SCOPE AND METHODOLOGY
========================================================= Appendix III

To determine if sexual orientation is considered as a security factor
in the security clearance process, we obtained policy memorandums and
investigative and adjudicative policies and procedures from 31
departments and agencies.  However, we focused our review on the
policies and procedures of eight departments and agencies that have
investigative authority or grant large numbers of security
clearances.  Except for the CIA, this represents over 95 percent of
the security clearances granted to civilian and contractor employees
during fiscal year 1993. 

Our review did not include security clearances for military
personnel; clearances at the CIA, Defense Intelligence Agency, or
National Security Agency; or cases involving access to sensitive
compartmented information. 

We excluded cases related to suitability for employment.  The
investigative procedures for determining suitability are similar to
those for granting access to classified information.  However,
suitability designations are based on the potential for damage to the
efficiency of government service, while security designations are
based on the potential for risk to the national security. 

To obtain information on security investigative processes, we
conducted our review at agencies that have investigative authority. 
To obtain data on security clearance denials and revocations, we
contacted and reviewed records at agencies that grant large numbers
(over 300) of security clearances.  We were unable to statistically
sample records from all agencies because there is no central security
database and most agencies do not categorize their records by the
reason for a security revocation or denial.  Our initial attempt to
sample security records at DOD did not provide useful information
since about 80 percent of the clearances are for military personnel
and civilian and military personnel records are merged.  We also
reached out to members of the homosexual community to identify
individual cases between 1991 and 1994 where individuals believed
their sexual orientation had affected the security clearance process. 

To determine if sexual orientation was reported as a cause for
security clearance denials, revocations, and suspensions, we examined
129 security files and/or case summaries at 8 departments and
agencies.  We reviewed files for all fiscal year 1993 denials,
revocations, and suspensions at the Defense Mapping Agency, Office of
Personnel Management (OPM), Department of State, and U.S. 
Information Agency (USIA).  This included
52 files at the Defense Mapping Agency, 13 files at OPM, 21 files at
the Department of State, and 9 files at USIA.  Of the Department of
Energy's
509 revocations, denials, and suspensions, we reviewed 6 security
files that were in a category we believed most likely to include
instances of sexual misconduct.  The FBI provided us with a
case-by-case summary describing the rationale for their revocations,
denials, and suspensions.  We examined copies of 14 suspension
letters provided to us by the U.S.  Customs Service. 

To identify recent instances where homosexual civilian and contractor
employees believed they were denied or revoked security clearances
because of their sexual orientation, we contacted local and national
gay and lesbian organizations and publications throughout the United
States, including the National Organization of Gay and Lesbian
Scientists and Technical Professionals, Inc., Pasadena, California;
The Federal Globe, Washington, D.C.; American Alliance for Rights and
Responsibilities, Washington, D.C.; The Village Voice, New York, New
York; Texas Triangle, Austin, Texas; Bay Area Reporter, San
Francisco, California; Metroline, Hartford, Connecticut; the State
Department's American Foreign Service Association, Washington, D.C.;
Gay and Lesbians in Foreign Affairs Agencies, Department of State,
Washington, D.C.; The Washington Blade, Washington, D.C.; Baltimore
Alternative, Baltimore, Maryland; Southern Voice, Atlanta, Georgia;
The Weekly News, Miami, Florida; Alabama Forum, Birmingham, Alabama;
Dallas Voice, Dallas, Texas; Out Front, Denver, Colorado; Orange
County Blade, Laguna Beach, California; and the Baltimore Gay Paper,
Baltimore, Maryland. 

We spoke with and obtained information from 10 experts and attorneys
who specialize in gay rights security issues; examined 41 1992 and
1993 investigator follow-up quality assurance letters; and examined
pertinent laws and regulations.  We also interviewed and obtained
information from officials at headquarters offices of the Departments
of Defense (DOD), Energy, Justice, and State; Office of Personnel
Management; U.S.  Customs Service; U.S.  Secret Service; U.S. 
Marshals Service; USIA; the FBI; the Defense Investigative Service;
the Department of Defense's Directorate for Industrial Security
Review; and the Defense Manpower Data Center, Monterey, California. 


CIVILIAN AND CONTRACTOR EMPLOYEE
CONCERNS REGARDING SEXUAL
ORIENTATION DISCRIMINATION
(1976-94)
========================================================== Appendix IV

Table IV.1 summarizes individuals' concerns regarding the impact of
sexual orientation in the security clearance process.  Individuals
contacted us as a result of our publications asking for information
from those who believed federal agencies had denied or revoked
clearances based on sexual orientation.  Some individuals referred us
to specific or other individuals' cases that we followed up on.  We
also reviewed security files with individuals' permission and
discussed some specific cases and general concerns with agency
officials.  The far right column shows how the agencies defined or
currently use the appropriate security standard relating to the
cases. 



                                    Table IV.1
                     
                      Individuals' Concerns About the Impact
                      of Sexual Orientation in the Security
                                Clearance Process

                  Date
               problem
               occurre
Agency               d  Description of concern       Agency's comments
-------------  -------  ---------------------------  ---------------------------
Air Force         1992  The employee's clearance     According to the Defense
                        was being updated. The       Investigative Service, an
                        employee believed the        investigation can be
                        investigator used the        expanded to determine if
                        employee's sexual            the employee is vulnerable
                        orientation to make the      to coercion and/or
                        employee feel uncomfortable  blackmail. If investigators
                        during the interview         have developed credible
                        process and fearful of       information, they may ask
                        being dismissed from the     questions about the
                        agency. A clearance was      employee's sexual
                        granted.                     orientation.

Army             1988-  The employee believes that   If the employee denies
                    91  sexual orientation was       allegations, investigators
                        responsible for a polygraph  can ask the employee to be
                        during a security upgrade.   polygraphed. A polygraph is
                        A clearance was granted.     voluntary and not used in
                  1987                               isolation. Before 1993,
                        The employee believes the    however, sexual
                        investigator focused on the  orientation, that is,
                        employee's homosexuality by  homosexuality, could
                        asking detailed questions    trigger the use of a
                        about the frequency and      polygraph.
                        nature of the employee's
                        sexual habits. The           An investigation can also
                        investigator then asked the  be expanded if
                        employee to dinner. The      investigators determine
                        employee's security          that sexual conduct, which
                        clearance was                has occurred within the
                        administratively             past 10 years, offers the
                        terminated.                  potential for influence,
                                                     duress, or exploitation;
                                                     when the conduct is a
                                                     crime; or when the employee
                                                     is cohabitating with
                                                     another unmarried person.

Defense           1982  The employee believes        If an investigation is
Mapping                 sexual orientation was       expanded, the investigator
Agency                  responsible for              may ask questions about the
                        inappropriate, personal      individual's sexual
                        questions being asked when   orientation.
                        a clearance was obtained in
                        1982. A clearance was
                        granted.

<h1xp> Navy       1991  The employee, a defense      If an investigation is
                        contractor, believes the     expanded, the investigator
                        investigator asked           may ask questions about the
                        unnecessary detailed         individual's sexual
                        questions about sexual       orientation.
                        partners during the
                        investigation because the
                        employee informed the
                        investigator of membership
                        in a local gay/lesbian
                        organization. The employee
                        felt intimidated by the
                        small, locked room where
                        the investigation was
                        conducted. A security
                        clearance was granted.

                  1992  The defense contractor
                        employee believed the
                        investigator asked improper
                        questions during a security
                        clearance update.

National          1987  The employee was an          If an investigation is
Security                overseas defense             expanded, the investigator
Agency                  contractor. The employee     may ask questions about the
                        believes sexual orientation  individual's sexual
                        discrimination occurred      orientation.
                        because coworkers informed
                        security officials that the
                        employee was fraternizing
                        with foreign nationals.
                        According to the employee,
                        investigators asked graphic
                        questions about the
                        employee's sexual habits.
                        The clearance was revoked.

Directorate       1992  The employee, a defense      Note: These defense
for                     contractor, believes         contractor cases were
Industrial              investigators asked          identified to us by
Security                improper, detailed           individuals familiar with
Clearance               questions regarding sexual   the cases, not the subject
Review                  habits during a security     of the investigations.
(DISCR)                 clearance update. The        DISCR is now known as the
                        clearance was                Defense Office of Hearings
                  1987  administratively suspended,  and Appeals.
                        but the clearance was
                        reinstated based on          The Defense Investigative
                        recommendations by DISCR.    Service performs background
                  1989                               investigations for the
                        The contractor employee did  Department of Defense (DOD)
                        not inform investigators     civilian and contractor
                        about homosexual             employees. Defense agencies
                        activities. After appealing  adjudicate and make
                        the case, a clearance was    security clearance
                        granted.                     decisions for civilian and
                                                     contractor employees. DISCR
                        The contractor employee was  reviews contractor employee
                        advised of an unfavorable    appeals, but civilian
                        security action because of   employees appeal through
                        homosexual and other         the defense agency or
                        activities. The employer,    service.
                        coworkers, and others--
                        except the employee's        Until 1993, DOD considered
                        spouse--were not aware of    homosexuality as sexual
                        the activities. DISCR        misconduct or deviant
                        believed the employee's      sexual behavior indicative
                        failure to disclose this     of a personality disorder.
                        information reflected poor   In 1993, Defense
                        judgment, unreliability,     Investigative Service
                        and information reflected    regulations and DISCR
                        poor judgment,               regulations were modified.
                        unreliability, and
                        untrustworthiness. A
                        clearance was not granted.

DISCR (cont.)     1987  Investigators considered
                        the contractor employee
                        subject to coercion and
                        influence based on the
                        employee's homosexual
                        activities. Supervisors and
                        work associates were not
                        aware of the employee's
                        homosexual activities. The
                        employee's security
                        clearance was granted on
                        appeal.

Commerce          1981  The employee, assigned       At one time, Commerce
                        overseas, claimed that the   maintained a list of
                        investigation was delayed.   countries where
                        The employee's assignment    homosexuality was
                        to Saudi Arabia was          acceptable, not acceptable,
                        canceled when agency         or not encouraged. It no
                        officials determined the     longer does so. Commerce is
                        employee was homosexual.     more concerned about the
                        The employee retained        impact an individual's
                        employment through           behavior might have on that
                        litigation. The clearance    person's ability to be
                        was retained.                trustworthy.

Energy            1992  The employee believes the    OPM conducts security
                        investigator focused on the  investigations for the
                        employee's homosexuality,    Department of Energy. In
                        but did not address other    adjudicating clearances,
                        issues such as the           Energy requires mandatory,
                        employee's being the victim  audiotaped interviews of
                        of child abuse or the        all employees, regardless
                        employee's alcoholism. The   of their sexual
                        employee believes that       orientation.
                        sexual orientation was used
                        as a reason for being
                        audiotaped during an
                        interview in January 1993.
                        A clearance was granted.

Justice           1992  The employee was required    Department of Justice
                        to sign a statement          investigations are
                        confirming the employee's    conducted by FBI
                        homosexuality. The employee  investigators. According to
                        believes the investigator    FBI officials, sexual
                        focused on the employee's    orientation, per se, has
                        homosexuality.               never been a disqualifying
                        Investigators also           factor in adjudicating
                  1991  interviewed the employee's   trustworthiness for a
                        mother. A clearance was      security clearance. Prior
                        granted.                     to March 1994, allegations
                                                     concerning sexual
                        The employee listed          orientation could cause an
                        membership in a gay/         investigation to determine
                        lesgian organization on the  whether the conduct would
                        security questionnaire.      cause vulnerability to
                        After the initial interview  coercion or influence.
                        was completed, the
                        investigator called the      The FBI requires a signed,
                        employee to set a time to    sworn statement whenever an
                        ask questions about the      employee is interviewed to
                        employee's alternative       resolve issues or
                        lifestyle. The employee      allegations that may affect
                        believed the additional      their trustworthiness. Such
                        interview was                issues can include
                        inappropriate. A clearance   unreported arrests, sexual
                        was granted.                 misconduct or notoriety
                                                     (whether heterosexual or
                                                     homosexual), or drug abuse.

Justice                                              Family members are
(cont.)                                              interviewed when the
                                                     investigation does not
                                                     resolve whether the
                                                     individual's sexual
                                                     orientation is concealed,
                                                     which may be the basis for
                                                     attempted pressure or
                                                     influence, and the subject
                                                     of the security
                                                     adjudication indicates that
                                                     family members are aware of
                                                     the sexual orientation. FBI
                                                     investigators are not,
                                                     however, to ask
                                                     specifically about the
                                                     employee's sexual
                                                     orientation or conduct.
                                                     Rather, the interview
                                                     should focus on the
                                                     individual's knowledge of
                                                     susceptibility to
                                                     compromise.

                                                     FBI investigators can
                                                     expand an investigation and
                                                     may need to reinterview the
                                                     subject when there are
                                                     unresolved questions of
                                                     trustworthiness or
                                                     suitability. However, as of
                                                     March 1994, investigators
                                                     may not ask individuals to
                                                     declare their sexual
                                                     orientation or preference
                                                     or ask persons being
                                                     interviewed to discuss
                                                     intimate sexual acts. Prior
                                                     to March 1994, FBI
                                                     investigators had no
                                                     written instructions,
                                                     although FBI officials told
                                                     us the unwritten
                                                     investigative guidelines
                                                     were the same.

OPM               1990  The individual accepted a    OPM's Investigator's
                        job at the agency. The       Handbook is being revised.
                        individual believed the      Investigators are not
                        investigator asked           authorized to question
                        intimidating questions.      applicants or appointees
                                                     concerning their sexual
                                                     behavior or attitudes
                                                     concerning sexual conduct.

Health and        1991  The employee believes the    OPM performs investigations
Human                   investigator asked           for Health and Human
Services                detailed, embarrassing       Services employees.
                        questions about the
                        employee's sex life. A
                        clearance was granted.

State             1985  The employee claims State    State Department officials
                        revoked a security           believe sexual orientation
                        clearance because of the     was not a key issue in any
                        employee's sexual            of these cases. According
                        orientation, and the fact    to State, other issues
                        that the employee had sex    surfaced, including
                        with a minor almost 10       unreported travel,
                        years ago should be          falsification of
                        forgiven.                    information, sexual
                                                     relations with
                                                     subordinates, and
                                                     fraternization with foreign
                                                     nationals. Heterosexual or
                                                     homosexual behavior with
                                                     foreign nationals will
                                                     prompt a security
                                                     investigation; however,
                                                     State will permit
                                                     cohabitation with foreign
                                                     nationals as long as
                                                     security officials are
                                                     aware.

State (cont.)     1992  Security officials           Until 1992, State security
                        threatened to revoke the     personnel asked individuals
                        employee's (a foreign        to appear as witnesses or
                        service officer) security    sources for information to
                        clearance upon receipt of a  ensure the individuals
                        letter alleging the          would attend the meeting.
                        employee had a homosexual    State officials told us
                        affair. Security officials   they used this procedure to
                        called the employee to       protect individuals'
                        appear as a source for a     privacy if they were at
                        fraud investigation. Upon    post. According to State
                        arriving at the meeting,     officials, this practice
                        however, security officials  has been discontinued.
                        announced the investigation
                        was about the employee's     In 1992, State curtailed
                        lifestyle. Investigators     the practice allowing
                        told the employee that any   investigators (with the
                        allegation of homosexuality  employee's permission) to
                        will prompt an               contact a family member
                        investigation. A clearance   selected by the employee to
                        was granted.                 verify that the family
                                                     member was aware of the
                                                     employee's sexual
                                                     orientation.

                  1989  Security officials asked     State's current (December
                        the foreign service          1992) policy is not to ask
                        employee to appear as a      questions regarding sexual
                        source for a fraud           conduct during the
                        investigation. Upon          preappointment or periodic
                        arriving at the meeting,     update investigation
                        however, security officials  process. If an individual
                        announced the investigation  volunteers information, the
                        was about the employee's     investigator may ask if
                        lifestyle. Security          family, friends, and
                        officials told the employee  associates are aware of the
                        that family members must be  individual's lifestyle, but
                  1993  informed of the employee's   the individual is not
                        homosexuality to prevent     required to inform family
                        the employee from being      members.
                        subject to coercion or
                        blackmail. The employee      State requires its
                        informed family members and  investigators to follow up
                        retained a security          on substantive allegations
                        clearance.                   that the employee is
                                                     involved in illegal or
                        The foreign service          exploitable sexual conduct.
                        employee issued a visa to a  Sexual misconduct is a
                        foreign national companion;  security concern if it
                        this prompted a security     involves a criminal
                        investigation that the       offense, indicates a
                        employee believes was        personality disorder, or
                        unfair because a             subjects the individual to
                        heterosexual issued a visa   blackmail or coercion.
                        to a foreign national
                        family member with no
                        repercussions. A clearance
                        was retained.

USIA              1976  The employee believes        Investigative procedures
                        sexual orientation was       have changed much since
                        responsible for difficulty   1976. USIA policy is not to
                        in obtaining a security      ask about sexual
                        clearance in 1976, but the   orientation unless it
                        employee eventually got the  involves foreign service in
                        clearance.                   a country that forbids
                                                     homosexual behavior.

                  1984  The employee's clearance     Concealment, regardless of
                        was revoked because of       sexual orientation, is the
                        unauthorized travel to and   only issue that concerns
                        possible fraternization      USIA security personnel as
                        with foreign nationals in    it pertains to applicable
                        an eastern bloc country.     laws and policies in
                        The employee left the        foreign countries.
                        agency and was rehired by
                        another agency.              USIA's current 1993
                                                     adjudicative policies and
                                                     procedures provide that
                                                     investigators should not
                                                     ask about sexual
                                                     orientation.

<h1xp> USIA       1986  The employee transferred     However, if the subject
(cont.)                 from another agency. The     volunteers this
                        employee believes            information, investigators
                        investigators asked          are expected to follow up
                        detailed, invasive           with questions regarding
                        questions about the          the individual's
                        employee's sexual behavior.  vulnerability to coercion
                        A clearance was granted.     because of sexual activity.

                  1989  A coworker denounced the
                        employee, a foreign service
                        officer, as a security risk
                        because of the employee's
                        homosexuality. At the same
                        time, the employee was
                        undergoing a security
                        review. The employee
                        believes investigators
                        asked detailed, invasive
                        questions about the
                        employee's sexual
                        lifestyle. The security
                        clearance was retained.
--------------------------------------------------------------------------------
Note:  We did not include cases involving employment issues or
sensitive compartmented information clearances since these issues
were beyond the scope of our review. 




(See figure in printed edition.)Appendix V
COMMENTS FROM THE DEPARTMENT OF
DEFENSE
========================================================== Appendix IV



(See figure in printed edition.)



(See figure in printed edition.)

<apnote:13> Now on p.  15. 

<apnote:33> See comment 1. 

<apnote:39> Now on p.  15. 



(See figure in printed edition.)

<apnote:3> Now on p.  16. 


The following are GAO's comment on DOD's letter dated November 1,
1994. 

GAO COMMENT

1.  DOD has taken steps to ensure that sexual orientation is not
considered a determining factor in the security clearance process. 
It has drafted revised adjudication guidelines and recently issued
revised investigative procedures.  DOD believes the recent changes to
its investigative procedures should be sufficient to preclude
inappropriate inquiry into one's sexual orientation.  However, we are
concerned that DOD's investigative procedures could be inconsistent
with its adjudication guidelines.  The investigative procedures
currently require investigators to follow up on credible allegations
of homosexuality, while its adjudication guidelines focus on sexual
misconduct, not sexual orientation.  Thus, to be consistent, it would
seem appropriate that in the area of sexual orientation, DOD's
investigative procedures should mirror its adjudication guidelines. 
DOD indicated that by April 1995, it will conduct a review of its
investigative procedures to ensure sexual orientation is not an issue
in the clearance process. 




(See figure in printed edition.)Appendix VI
COMMENTS FROM THE DEPARTMENT OF
STATE
========================================================== Appendix IV



(See figure in printed edition.)

<apnote:23> Now App.IV
on pp.  35-36.
See comment 1. 

<apnote:27> Now on p.  36.
See comment 1. 

<apnote:33> Now on p.  38.
See comment 1. 


The following are GAO's comment on the Department of State's letter
dated October 17, 1994. 

GAO COMMENT

1.  The technical corrections suggested by State were incorporated in
our final report. 




(See figure in printed edition.)Appendix VII
COMMENTS FROM THE U.S.  SECRET
SERVICE
========================================================== Appendix IV




(See figure in printed edition.)Appendix VIII
COMMENTS FROM THE OFFICE OF
PERSONNEL MANAGEMENT
========================================================== Appendix IV

<apnote:26> Now on p.2.
See comment 1. 

<apnote:39> Now on p.11.
See comment 1. 



(See figure in printed edition.)


The following are GAO's comment on OPM's letter dated November 9,
1994. 

GAO COMMENT

1.  The technical corrections suggested by OPM were incorporated in
our final report. 




(See figure in printed edition.)Appendix IX
COMMENTS FROM THE U.S.  CUSTOMS
SERVICE
========================================================== Appendix IV

<apnote:27> Now on p.  13.
See comment 1. 

<apnote:39> Now on p.  15.
See comment 2. 



(See figure in printed edition.)


The following are GAO's comments on the U.S.  Customs Service's
letter dated October 17, 1994. 

GAO COMMENTS

1.  We believe that the Customs Service's statement on concealment is
inconsistent with its policy that no individual may be asked to
declare his or her sexual orientation or preference and that no
inference concerning susceptibility to coercion may be raised solely
on the basis of sexual orientation.  This issue, as it pertains to
the Justice Department and the FBI, is discussed in-depth on pp. 
13-15 of our report. 

2.  With regard to the Customs Service's concern about vulnerability
to espionage, we note that, historically, the chief motivating factor
in espionage cases is pure monetary greed. 




(See figure in printed edition.)Appendix X
COMMENTS FROM THE U.S. 
INFORMATION AGENCY
========================================================== Appendix IV

<apnote:18> Now App.  IV
on pp.  36-37.
See comment 1. 

<apnote:34> Now on p.  7.
See comment 1. 



(See figure in printed edition.)


The following are GAO's comment on USIA's letter dated October 20,
1994. 

GAO COMMENT

1.  The technical corrections suggested by USIA were incorporated in
our final report. 




(See figure in printed edition.)Appendix XI
COMMENTS FROM THE DEPARTMENT OF
JUSTICE
========================================================== Appendix IV

<apnote:27> Now on p.  11. 



(See figure in printed edition.)

<apnote:4> Now on p.  3. 

<apnote:10> See comment 1. 

<apnote:23> See comment 2. 

<apnote:31> See comment 3. 

<apnote:39> See comment 4. 



(See figure in printed edition.)

<apnote:9> Now on p.  13. 

<apnote:14> Now on p.  16. 

<apnote:19> See comment 5. 


The following are GAO's comments on the Department of Justice's
letter dated December 2, 1994. 

GAO COMMENTS

1.  We eliminated references in the report contrasting FBI guidelines
on sexual orientation with Justice policy and clarified our report to
specifically identify sections of the guidelines that raise
questions.  (See comments 2 and 3.)

2.  The FBI's guidelines provide no examples where sexual orientation
could reasonably be thought to raise an issue of susceptibility to
coercion.  Rather, the guidelines address instances where sexual
conduct (e.g., a sexual relationship with a subordinate employee,
date rape, or public lewd behavior) is relevant to suitability or
trustworthiness. 

Moreover, the requirement that volunteered information on an
individual's orientation be recorded for use in determining the
individual's vulnerability to compromise constitutes different
treatment than that of heterosexual applicants.  The FBI guidelines
on sexual orientation require the assessment of a homosexual
applicant's vulnerability to compromise solely on the basis of sexual
orientation without any indication that there has been behavior or
conduct that would warrant further assessment.  A similar assessment
is not required of heterosexual employees without an indication that
there has been behavior or conduct that could make an applicant
vulnerable to blackmail or coercion.  Further, with the exception of
DOD, which has said it intends to, the other agencies in our review
have eliminated references to concealment of sexual orientation as a
security concern. 

3.  Applicants have no obligation to reveal their orientation
because, according to Justice policy, individuals may not be asked to
declare their orientation. 

4.  The FBI's December 1994 letter to its field staff deals primarily
with guidelines for follow-up interviews with applicants when a third
party provides information about a potential vulnerability. 

5.  See comments 2 and 3. 


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix XII

NATIONAL SECURITY AND
INTERNATIONAL AFFAIRS DIVISION,
WASHINGTON, D.C. 

David R.  Warren
Thomas J.  Howard
Elizabeth G.  Mead
Leo G.  Clarke, III
Jacqueline E.  Snead

OFFICE OF THE GENERAL COUNSEL

Ernie E.  Jackson