Dr. Andrew Liaropoulos
(RIEAS Senior Analyst and Lecturer in Piraeus University)

Dr. Ioannis Konstantopoulos
(RIEAS Research Associate and Lecturer in Piraeus University)

Copyright: www.rieas.gr

Over the last decade, the intelligence community is facing without a doubt, many challenges. The international environment has transformed and is more complex compared to the one that shaped the intelligence services during the Cold War era. The need to provide timely and sound intelligence has increased and the request for intelligence reform seems imperative. Governments have decided to outsource part of their intelligence needs, but this choice raises some critical questions: Are governments turning national security into business? Ιs the private sector in a position to penetrate the intelligence community and thereby spin intelligence and downgrade the role of intelligence agencies?   

The privatization of intelligence has developed rapidly over the last decade and given the nature of the ongoing military operations and the increased need for counterterrorist operations, intelligence contractors will most likely remain a central element of the intelligence community for the years to come. From analysis to signals intelligence and to interrogation of enemy prisoners, private companies are now performing tasks that governments used to do. Intelligence contractors provide sensitive services, ranging from covert operations to recruiting spies and from gathering human intelligence to producing finished intelligence. The post 9/11 environment highlighted a trend that existed from the early days of the intelligence business, the practice of outsourcing intelligence collection and analysis. According to the Office of the Director of National Intelligence, 70 per cent of the US intelligence budget goes to contractors.

In parallel with the rise of private military and security companies, privatization of intelligence raises similar concerns regarding accountability, brain-drain, the cost of contracting and mainly what activities should remain strictly governmental. Due to the growing dependence on private contractors, conflicts of interest arise when intelligence agencies and the private sector are so close. In addition, numerous senior intelligence officers have departed, due to higher salaries in the private sector. This trend obviously affects the morale of those who perform the same tasks in the intelligence services for significantly lower pay. We should bear in mind that every national intelligence community makes a large investment in its employees and now seems to be unable to retain its experienced personnel and transfer knowledge to a new generation of intelligence officers. The intelligence community is in competition with the private sector and in the long run, this trend will most likely affect the work force structure of the intelligence community.     

Another critical aspect regarding privatization of intelligence involves the functions the community can outsource. The usual practice is to differentiate between core and non-core tasks and outsource the latter. But the experience from the battlefield in Iraq and Afghanistan, has demonstrated that the community has been ‘forced’ to use private contractors to perform functions that are regarded as ‘inherently governmental’. The handling of human intelligence assets, estimating terror threats and briefing field commanders are some of the tasks that are performed by private contractors and fall into the above category.   

The involvement of the private sector in interrogation raises the thorny issue of intelligence accountability. In the Abu Ghraib prison in Iraq, intelligence contractors were alleged to have abused prisoners and to have used illegal interrogation techniques to gather human intelligence. Likewise the involvement of contractors in analysis highlights the possibility that private companies might be able to influence high level decisions about national security.

To conclude, private contractors are without a doubt, critical to the intelligence community, but the later needs to employ safeguards over contractor access to sensitive intelligence and develop guidelines regarding budget, the quality of the personnel and the number of the contractors. Indicative of the above is the fact that in June 2007 the CIA announced its plans to review the use of contractors and reduce the number of contractors by 10 per cent. In particular, since June 2007, the CIA started to ban contractors from hiring former CIA employees and then offering their services back to the agency, within the first year and a half of retirement. The government needs to discipline the intelligence–industrial complex and avoid turning national intelligence into a profitable business. Echoing Chersterman, the task to determine what is and is not ‘inherently governmental’ in the intelligence community, is up to the government itself to decide. Obviously, a short article like this can only scratch the surface, and we refer the reader to the reference list for further information.

Glenn J. Voeltz, ‘Contractors and Intelligence: The private sector in the intelligence community’, International Journal of Intelligence and Counterintelligence, 22, 4 (2009). 
Simon Chesterman, ‘We can’t spy…if we can’t buy!: The privatization of intelligence and the limits of outsourcing inherently governmental functions’, The European Journal of International Law, 19, 5 (2008).
Tim Shorrock, Spies for Hire: The Secret World of Intelligence Outsourcing (NY: Simon & Schuster, 2008).

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