Section I:  Senate Intelligence Committee Report in 1986.

Source:

   "Meeting the Espionage Challenge: A Review of United States
    Counter-Intelligence and Security Programs"

    by Select Committee on Intelligence, United States Senate.
    (99th Congress, 2rd Session, Report 99-522)

    First of all, Mr. Eftimiades seemed to have copied a lot of
languages from this report, including facts and definitions.

    This report was written when the Soviet Union was still the
major threat.  It has only one section and a few sentences deal
with the PRC intelligence.  In fact this report had written that (p.19)

    "The PRC is not now in strategic competition with the United States.
Indeed, the United States has fundamental interests in maintaining
friendly relations with the PRC and promoting its modernization,
to include selective upgrade of its military defensive capabilities."

    However, this report is the source of a very important claim in Mr.
Eftimiades' book, and probably what the CBS primary allegation of 
"biggest spy network"  based on also.  BUT, let's read the language 
carefully.


CBS (May 19, 1994):
===================
"CHUNG: Coming up next, Eye on American. Tonight, the biggest spy network
in American. We'll tell you who's running it and how."

CIO by Eftimiades (1994, page 27):
==================================
   "Most Chinese clandestine collection activities are not sophisticated
operations, but their numbers compensate for this weakness . To Conduct
espionage in the United States the MSS draws on the services of
   --- 1,500 Chinese diplomats and commercial representatives
   --- 70 PRC establishments and offices
   --- 15,000 Chinese students arriving annually
   --- 10,000 representatives traveling in 2,700 delegations each year
   --- a large ethnic Chinese community."

Senate Committee Report (1986, page 19):
========================================
   "The PRC has several intelligence services whose personnel are 
represented among the approximately 1,500 Chinese diplomats and
commercial representatives located at 70 PRC establishments and offices
in the United States. They also have some access to the approximately
15,000 Chinese students and 10,000 individuals arriving in 2,700
delegations each year.  PRC intelligence also seeks to exploit the
large ethnic Chinese community."


    As we can see, the Senate report is very reasonable and in fact
THE correct way of presenting the facts.  It wrote that the PRC
"have SOME ACCESS" to the 15K student and 10K visitors each year.

    Mr. Eftimiades has already distorted the original language by
saying that PRC "draws on the services of" 15K students and 10K
visitors.  This is a very clever distortion, since you can "draw
service of" ALL of them, or ONE OR TWO of them.

    Now came the CBS, it becomes "biggest spy network"!  Which is
not only distortion, but a complete falsification or fabrication.
Sure, (15K+10K) x 10years is such a huge number that "biggest" is
definitely an underestimate!

    In addition, this might even be the source of that CBS vice
president Mr. Venados claim that there are "hundreds" of Chinese
in the US are Chinese spies.  (This thread has been developed
in the letter to Mr. Venados.)




Section II  Possible Warnings of Spies 

Source:

(SIC Report, 1986, same as in Section II)


    In the CBS report, Connie Chung alleges that the FBI has warned American
companies watching out for Chinese spies.  

    However, there is a general guideline in the Senate Intelligence
Committee Report (1986. 99-522) about the "awareness briefing"
against foreign intelligence agents, mostly against the Soviet bloc
I might add.

    It is indeed interesting that the Security Manual developed in this
committee does call attention to "communist country nationals", however
it has not put an hammer on a particular race.

    Please note that anti-discrimination laws specifically mentioned
about discrimination against country of origin.  Maybe communist
countries are indeed a different category that should be discriminated.
This is worth some legal studies.

  The following is from the senate report:

    The first part is warnings to Americans who have security clearance:

****

    "Based upon the lesson of Bell/Zacharski, and other similar cases,
awareness briefings should stress the following:

"What should you know

    "There is potential danger in any sustained contact with a com-
munist-country national (and not just with Soviets).  You are not re-
quired to avoid all contact; just be careful.

    "Recruitment is a subtle, gradual process (a 'long, bit-by-bit
thing', Bell called it).  Cultivation may last for months or years and
initial active involvement may have nothing to do with espionage 
in any recognizable form. 

[Note: "recruitment" here means spy recruitment.  -- DX]

    "Recruitment may involve no elements of blackmail or threat, so
those who regard themselves as 'clean-living' may nonetheless be
susceptible to this sort of activity.

    "Positive inducements will involve psychological ploys (friendship,
flattery sharing of common opinions/interests) as well as (and usu-
ally prior to) material offerings.

    "'Entrapment' once it comes is as much as a psychological as a ma-
terial entanglement, and commitment (as in Bell's case) may only
be recognized after the fact.

"What you should do

    "As a cleared contractor employee, you must report to the security 
supervisor: 1) all acts of espionage or suspected espionage, a) any
attempt to gain unauthorized access to classified information, 3)
any compromise or suspected compromise of classified information,
4) plans for travel to (or through) a communist-controlled country,
5) plans to attend any professional meeting where communist country
nationals may be in attendance, 6) plans to host a facility visit
by communist country nationals.

    "You should (for your own protection) report any contact, particularly
sustained contact, with a communist-country national, even if
purely personal and seemingly casual.  In this way you avoid any
suspicions which might arise regarding your own conduct and permit
authorities to warn you if the individual is suspected of 
intelligence involvement.


***

    The next part is for companies watching possible spies, these are
of interest to us.  -- DX

***

    "POSSIBLE ESPIONAGE INDICATORS: 'AN OUNCE OF PREVENTION'

    (Source: U.S. Air Force Office of Special Investigations (AFOSI)
                   (Adapted from TIG Brief 18, 1982))

    "From an analysis of confirmed espionage cases, AFOSI has developed
a listing of characteristics shared by several of the spies in
varying degrees.  While no element of this list of 'warning-signs' is,
in itself, proof of an individual's involvement in espionage, observation
of such characteristics in the behavior of an individual with
access to classified information should be a matter of concern to security
and supervisory personnel.  Even where espionage is not
present, several of the characteristics may be indicative of problems in suitability of security which cannot be prudently ignored.

    "The list as presented here has been adapted to reflect the special 
requirement applicable to Defense contractors under the Industrial
Security Manual for Safeguarding Classified Information (ISM,
DoD 5220.22-M), as well as requirements for DIS employees.

    "Behavior patterns of possible significance include the following.

    "Attempts to expand access to classified information, though 
repeated volunteering for special assignments with additional access 
or inquiries concerning information for which the individual has no 
need to know.

    "Unauthorized removal of classified material from the work area,
by making extra carbons or copies or placing of classified materials
in briefcase, purses, gym bags, etc.

    "Repeated or unusual overtime, especially unaccompanied, whereby
making the individual arranges to be alone or unobserved in an office
containing classified material.

    "Falsifying destruction records by requesting certification or 
witnessing signatures for destruction of classified materials which the
individual has not actually seen destroyed.

    "Sudden, unexplained affluence as indicated by purchase of expensive
cars, real estate, jewelry etc,; by display of large amounts of
cash; or by lump-sum repayment of significant debts, large stock
purchases, or opening of substantial savings accounts --in the
absence of some legitimate source of increased income.  Unexplained
affluence is of particular concern when it follows a period of leave or
travel.

    "A pattern of recurring travel, within the United States or (especially)
abroad, perhaps 2 to 4 times per year, without apparent recreational
or business purpose.  Married individuals who travel for tourism or
recreation unaccompanied by family members may also be of concern.

    "Falsification of locations visited on leave statements or trip 
reports.  Also reluctance to describe or ignorance concerning places
supposedly visited.

    "Travel to Communist countries or on communist-flag ships or 
aircraft not involving an organized tour and not explained by business
or family connections.  ANy attempts to visit communist countries
without complying with applicable reporting requirements is of
particular concern.

    "Repeated association with Communist-country nationals without
bona fide business purpose or without required reporting.

"NOTE FOR CONTRACTORS

    "Under the ISM cleared contractor employees must report anticipated
contacts with communist-country nationals at professional
meetings or through facility visits.  A forthcoming change to the ISM
will require contractor employees to report 'all questionable or suspicious
contacts with nationals or representatives of communist countries,' i.e.,
any contact 'determined to consist of an actual, probable or possible
hostile intelligence collection effort.'

"NOTE OF DIS EMPLOYEES

    "DIS employees, as well as all Federal employees, are required to 
report improper or suspicious contacts by representatives of any
foreign interest, just as contractors are required to report.  THese
naturally include contacts ny communist-country nationals.

    "While none of the indicators listed is proof of espionage, any
pattern of conduct on the part of a cleared employee which suggests 
the possibility of improper activity should be reported by supervisors
or managers to the Facility Security Supervisor.  Security Supervisors
should report in turn to the Defense Investigative Service and the FBI.

    "Where there is doubt whether information should be reported, it
should be furnished to the proper authorities for evaluation.  Security
Supervisors should be aware that in two 1967 cases the U.S. Court
of Appeals for the 4th Circuit held that a contractor is not
liable for defamation of an employee because of reports made to
the U.S. Government pursuant to the Industrial Security Manual.  The Court
stated in essence that such reports are privileged, since the contractor 
in executing the requirements of the Manual dons the cloak of a 
federal official.

    "Such reports do not of course constitute incrimination in 
themselves, and adverse action by government activities can only be 
taken with probable cause and due process.  But the effectiveness of
U.S. security and counterintelligence efforts is directly and vitally
dependent upon early reporting of any possible instances of
compromises or espionage.

*****

   Our comments:

1.  The CBS report mentioned something of the FBI warned American 
    corporations about espionage efforts.  These guidelines should
    be what the FBI based on.  There is no mention about a particular
    ethnic group.  If there is a comment in those warnings about
    Chinese nationals, it is clearly racist and unconstitutional.

2.  It made clear that reports to the authority about some specific
    behaviors of a certain individual does not constitute defamation,
    which is NOT what the CBS did!  A defamation is to spread 
    "privileged" information, truthful or not, in the public!

3.  These guidelines are about defence contractors, which needs tight
    security clearance.  It is not about everyone on the street
    or any business in the corner.