Memorandum from James Webb to President Harry S. Truman with Attachment

EXECUTIVE OFFICE OF THE PRESIDENT BUREAU OF THE BUDGET WASHINGTON, D.C. JAN 7 1949 MEMORANDUM FOR THE PRESIDENT SUBJECT: Change in loyalty investigation procedure At present Executive Order 9835, providing for the employee loyalty program, requires the Civil Service Commission to make specific name and record checks of nine sources of possible in- formation regarding applicants for positions. Data was secured from the Commission regarding the extent to which each of such sources yielded information indicating neces- sity for full-field investigations by the Federal Bureau of Inves- tigation. It was found that approximately 85 percent of all the loyalty cases referred to the FBI arose from information secured from four sources and only 15 percent arose from the five remain- ing sources. That 15 percent of cases involved approximately 45 percent of the total cost of record checks. Accordingly, it appears that the mandatory checking by the Civil Service Commission should be limited to four major sources and that the checking of the remaining five sources should hereafter be discretionary with the Commission. The funds for this function in the Commission's 1950 budget request were reduced on that basis. Concomitantly, additional funds were included in the budget of the Civil Service Commission for the purpose of reimbursing the Federal Bureau of Investigation for investigating applicants for the so-called sensi- tive positions in the Government; the Commission has no funds for such investigations in the current fiscal year. There is attached a draft of Presidential letter to the Presi- dent of the Civil Service Commission which would limit the mandatory name and record check investigations to the four most productive sources and make the remaining five checks optional. The letter draft was prepared by the Attorney General. While the Commission is somewhat lukewarm to the change in investigation procedure, the budgetary decision referred to above requires a modification of the present elaborate procedure and the Commission agrees that a letter such as the attached would accomplish such modification. Attachment I recommend transmittal of Jan the attached proposed letter. E.Webe Director x79 GOVERNMENT