- The Washington Times - Thursday, March 15, 2001

FBI Director Louis J. Freeh has selected a counterintelligence "czar" who will be named today and charged with strengthening U.S. capabilities to track foreign spies in the wake of the Robert Hanssen spy case.

Bush administration officials said the new director of the program called CI-21 counterintelligence for the 21st century will be FBI Special Agent David W. Szady, a 28-year FBI counterspy who currently heads the FBI's Portland, Ore., field office.

One official said Mr. Freeh will announce the appointment as the new head of the National Counterintelligence Board of Directors, the Cabinet-level board set up by presidential order.

"Szady was selected unanimously," said the official. "He is someone who has a long and successful career in counterintelligence."

From 1997 to May 1999, Mr. Szady was chief of an interagency counterintelligence/counterespionage group that reported to CIA Director George J. Tenet and Mr. Freeh.

He also worked in the San Francisco office as a counterspy charged with tracking high-tech espionage in nearby Silicon Valley.

Mr. Szady also was a supervisor in Washington for Soviet counterspy efforts from 1975 to 1985 and was commended for his role in the John A. Walker Jr. friends-and-family espionage ring that supplied Navy code secrets to Moscow.

The appointment of the new counterspy czar was mandated by an executive order signed by President Clinton in January known as PDD-75 on "counterintelligence effectiveness."

Another administration official said Mr. Bush's National Security Council approved the Clinton counterspy program.

The directive "outlines specific steps that will enable the U.S. counterintelligence community to better fulfill its mission of identifying, understanding, prioritizing and counteracting the intelligence threats faced by the United States," the White House said in a statement.

FBI counterspying has come under fire in recent weeks from critics who questioned how FBI Special Agent Robert Hanssen, a 27-year counterspy, could operate clandestinely for 15 years without being detected.

Mr. Hanssen was arrested in February and charged with being a "mole" for the Soviet Union and later Russia since 1985. He has not entered a plea yet, but his attorney has said he plans to plead not guilty.

FBI counterintelligence also has come under fire for its handling of the Wen Ho Lee spy case. Mr. Lee, a Los Alamos nuclear-weapons scientist, was suspected of supplying China with U.S. nuclear-warhead technology. His case ended in a plea agreement last year on one count of mishandling classified information related to nuclear codes.

The new counterintelligence program also will replace the interagency Counterintelligence Center located at CIA headquarters. Critics have said the center was ineffective.

The fact that the new "CI executive" is being announced by Mr. Freeh and not by President Bush is viewed by some in Congress as a sign that the counterspy chief will lack White House support.

"There are serious concerns about the commitment of the administration to this," said one congressional aide. "The sentiment here is that the person for that job needed to be a heavy hitter."

Some intelligence analysts also questioned the structure of the new program. The program establishes a "czar" post, but with limited resources. The executive also will be directed by a national-level board of directors headed by the FBI director and including senior officials from the CIA, the Pentagon, Justice Department and other agencies.

"The board … will operate by consensus and will select, oversee and evaluate the national counterintelligence executive and will promulgate the mission role and responsibility of the CI executive," the White House said in January.

The first task of the board will be to identify a national counterspy strategy from a threat assessment. The point of the program is to make sure "adequate resources" are devoted to catching spies.

The counterspy agency will produce an annual report on foreign spying threats, including those posed by traditional agents as well as newer dangers from information warfare.

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