AUSTRALIAN SECRET INTELLIGENCE SERVICE

WHAT ASIS DOES

162. ASIS collects foreign intelligence, relying on human sources to obtain information. It produces and disseminates intelligence reports to key government decision-makers.

163. ASIS was established by executive order on 13 May 1952 and operated under government directive until the Intelligence Services Act (ISA) came into effect on 29 October 2001.

164. ASIS’s intelligence collection and reporting activities are now regulated by ministerial directions, ministerial authorisations and privacy rules, which have been made pursuant to the ISA.

165. The ISA prohibits ASIS from engaging in activities involving violence or the use of weapons. There is also a prohibition on activity for the purpose of furthering the interests of political parties.

166. Targeting priorities for ASIS and other members of the AIC are established in a planning document that is endorsed and regularly reviewed by the National Security Committee of Cabinet.

167. Further information about ASIS is at http://www.asis.gov.au.

SENIOR APPOINTMENTS

168. Mr Allan Taylor AM completed his five-year term as Director-General of ASIS in February 2003.

169. During his period as Director-General, Mr Taylor oversaw the placement of ASIS on a statutory footing, an increasing openness of the Service to external scrutiny, and continuous attention to maintenance and improvement of professional standards.

170. Mr Taylor consistently promoted accountability through all levels within ASIS and strongly supported the work of this office in its inquiry and review activities. I wish Mr Taylor well in his retirement.

171. Mr Taylor was replaced as Director-General of ASIS by Mr David Irvine. Mr Irvine has had a long and distinguished career in the diplomatic service and was most recently Australian Ambassador to China.

INSPECTION ACTIVITIES

172. Inspection activities involving ASIS during the reporting period have included:

monitoring compliance with the ASIS privacy rules;
inspecting current operational files; and
reviewing all submissions, including requests for ministerial authorisations, made by ASIS to the Minister for Foreign Affairs.

173. The Director-General and I have agreed that following each inspection activity, we would discuss any concerns with an appropriate senior manager or liaison officer. I have also made a practice of following up each inspection with a letter reporting the results and outlining any issues raised during the inspection.

174. We have also agreed procedures that would operate should I form the view that any matter arising from an inspection needed to be brought to the attention of the Minister for Foreign Affairs or the Prime Minister. No such matters arose during the reporting year.

Intelligence Services Act and privacy rules

175. Last year’s annual report discussed the background to the ISA and its first few months of operation.

176. Since coming into effect, the ISA has brought about a number of changes in the way ASIS goes about its business, the foremost being that the Minister for Foreign Affairs, rather than the Director-General ASIS, is now the person responsible for approving activities carried out for the purpose of collecting intelligence on Australian persons. ASIS rarely carries out such activities.

177. At the conclusion of the reporting period the ISA and ASIS’s privacy rules had been in operation for approximately 20 months. In that time we have raised several queries about the application of the rules.

178. ASIS is maintaining a list of these issues so that legislative amendments, where appropriate, can be proposed at an opportune time.

Review of operations

179. In previous years, a member of the office and I would review a selection of current ASIS operational case files at ASIS headquarters every eight weeks to ensure that the operations are carried out legally and with propriety.

180. In March 2003 I engaged a former Inspector-General and Commonwealth Ombudsman, Mr Ron McLeod AM, as a consultant, in order to increase the frequency of these reviews. They now take place every three to four weeks.

181. While this review activity necessarily has a retrospective focus we sometimes comment on very recent actions.

182. For the most part, the cases we reviewed were well planned, well run, tightly controlled, and delivered outcomes that were of significant benefit to the national interest.

183. We did, however, raise a number of issues with the Director-General. While it is not possible to comment in detail on each of these matters in a public report, they included:

issues arising from ASIS officers travelling with material that, while legal in Australia, might attract attention from overseas law enforcement agencies;
the appropriate handling of a dissatisfied former human source;
clarifying the respective roles of Australian intelligence agencies in conducting a risk assessment of a human source; and
concerns associated with the acquisition of specialist equipment.

184. The Director-General provided considered responses and I was satisfied with the outcome in each case.

185. In addition to raising issues of this kind, senior managers in ASIS frequently brief me on issues of common interest.

Ministerial submissions

186. We regularly review ASIS’s written submissions to its minister relating to operations, including submissions seeking authorisations under the Intelligence Services Act.

187. I am satisfied that these submissions contain sufficient information for the minister to make well-informed decisions.

Use of assumed identities

188. Recent amendments to the Crimes Act 1914 require Commonwealth agencies that issue or use alternate identity information to maintain appropriate records.

189. The amendments require ASIS, as soon as practicable after 30 June each year, to give the Inspector-General a report for the year.

190. The report for 2002-2003 showed that ASIS issued a number of authorisations under the legislation for use of assumed identities by its officers.

Contact with staff

191. Most ASIS officers meet with me prior to their overseas postings. The purpose of these meetings is to remind ASIS representatives of the role and functions of this office.

192. I also meet with heads of mission who are being sent to posts where ASIS staff are present, to discuss any issues or concerns they might have prior to their departure.

193. In addition to these pre-departure meetings I regularly attend training sessions for ASIS officers and inductees, addressing them on accountability issues and the work of the office.

194. As I did not travel overseas during the reporting period, I visited no ASIS stations in the past 12 months.

COMPLAINTS AND INQUIRIES

195. One complaint about ASIS was carried over into the 2002-03 reporting period. Four new complaints about ASIS led to preliminary or full inquiries. One complaint required checking with all AIC agencies, while the Bali inquiry (see Annex 2) also necessarily required involvement with all AIC agencies.

196. In addition to these matters we received six other complaints about ASIS which were handled without need for inquiry action.

197. A summary of some of the full or preliminary inquiries is provided below.

Termination of relationship

198. I received a complaint in January 2002 from a person who alleged that ASIS terminated its relationship with him in a premature and unsatisfactory manner, contrary to undertakings it had given him. As a consequence, the complainant claimed he had been left with obligations he could not meet.

199. Following an extensive inquiry I invited comment from the Director-General on a draft report in February 2003 and finalised the report in April 2003.

200. The draft report foreshadowed a recommendation for a payment to the complainant to enable him to meet some of the obligations he claimed to have assumed for ASIS’s benefit. The complainant, however, informed me that he considered the proposed payment insufficient and he subsequently took other action to try and achieve a better result.

201. The final report, therefore, did not recommend a payment but it did recommend a number of improvements to procedures relating to such matters as agreements with sources, record keeping, and confirming customer requirements.

202. The Director-General informed me that ASIS had already, or would as soon as possible, implement all these suggested improvements.

Psychological assessments

203. An unsuccessful applicant for employment with ASIS contacted my office in August 2002, raising concerns about the selection process she had just undertaken.

204. The complainant had previously applied for employment with another intelligence agency and in the course of that process had been the subject of a psychological assessment.

205. The complainant questioned:

the appropriateness of intelligence agencies sharing psychological profiles of job applicants;
the timing of ASIS’s request to access the results of this earlier psychological assessment she believed this should happen at the start of the process, before applicants had gone to the trouble of attending for interview; and
whether there had been discrimination against her on the grounds of her declared religious beliefs.

206. I have previously concluded that sharing information of this kind is appropriate, for good reasons related to security.

207. On the question of timing, I found that it was appropriate for intelligence agencies not to seek this information immediately upon receipt of an application but to first assess applicants against their own selection criteria, without being influenced by opinions expressed in another agency.

208. In this case, however, it became apparent on inquiry that ASIS had accessed the other agency’s material after it decided not to employ the complainant. I could see no good reason for this and sought an explanation from the Director-General.

209. The explanation was that ASIS wished to confirm that the complainant had not been recommended for employment in the other agency following her psychological assessment interview; and to compare its assessment with that of the other agency as a quality control measure.

210. There did not seem to me to be any significant security benefit to offset the infringement of the applicant’s privacy.

211. I therefore sought and obtained from the Director-General an assurance that ASIS would not in future seek to access psychological assessment material from other agencies simply for the purposes described above.

212. In view of the possibility that other agencies might be adopting similar practices I also sought and received similar assurances from the heads of the other agencies in the Australian intelligence community.

213. I found no evidence to support the complainant’s concerns that she might have been discriminated against on religious grounds.

Recruitment processes

214. In March 2003, I received a complaint from an unsuccessful applicant for employment with ASIS.

215. The complainant wished to obtain reasons why his application was unsuccessful and to ascertain whether security concerns led to the decision.

216. After a short investigation I was able to provide the complainant with some additional detail about the selection exercise he was a part of.

Bali terrorist attack

217. ASIS provided full and enthusiastic assistance with the conduct of this inquiry, devoting major resources to the task of identifying and bringing to attention possibly relevant material. The body of the final report is classified, but the unclassified introduction and summary is at Annex 2 to this annual report.

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