Defense Secretary Chuck Hagel is reviewing a plan for the Pentagon to resume responsibility for vetting security clearance applicants. (Jewel Samad/AFP/Getty Images)

The Pentagon is moving toward taking back responsibility for vetting security-clearance applicants, a process that has come under increased scrutiny since investigators found widespread problems that they said contributed to national security threats.

Officials said the idea, which is under review by Defense Secretary Chuck Hagel, would allow the department better control of background checks, now done largely by the Office of Personnel Management.

The OPM’s background investigations have been criticized as rushed and incomplete, and the main contractor in charge of the work for the agency is facing a whistleblower lawsuit. The suit, which the Justice Department has joined, alleges that the company “dumped,” or submitted incomplete background checks, in 665,000 cases in 4 1 / 2 years to meet performance incentives and reduce backlogs.

Pentagon reviews released Tuesday concluded that the September mass shooting at the Washington Navy Yard, committed by a former Navy service member who was working as a defense contractor, could have been prevented. The reviews said Navy personnel and supervisors at Experts Inc., which employed shooter Aaron Alexis at the time, missed several opportunities that could have prevented him from obtaining a security clearance.

One of those reviews, an independent report ordered by Hagel, criticized the OPM, saying that its process “lacks transparency” and that its “contract investigators reduce investigations to checklists.” The report urged the Pentagon, which pays the OPM $800 million annually for background checks, to perform the checks in-house, as the State Department does.

In the meantime, the report said, the Pentagon should immediately deploy case managers to work with OPM investigators “to improve the quality of investigations and adjudications.”

OPM Director Katherine Archuleta said in a statement that since she took over the agency in November, the issue has been “a priority.” “It is essential that we continue to identify areas to strengthen the background investigations program and take the steps necessary to improve the process,” she said.

She has been vocal about holding accountable USIS, the contractor that does most of the OPM background investigations, and has said that her agency is working closely with the Justice Department on its investigation.

In recent years, the OPM has scaled back its reliance on USIS, which was paid $417 million in fiscal 2010 and $320 million last year, according to the OPM. During that time, the two other companies that perform investigations for OPM, KeyPoint Government Solutions and CACI, saw their payments and share of the work rise. KeyPoint’s payments jumped from $85 million to $138 million; CACI’s rose from $17 million to $46 million.

But the OPM has still paid USIS, which did the background checks on Alexis and former National Security Agency contractor Edward Snowden, more than $1.4 billion from 2010 to 2013 and $110 million this year. That has prompted some in Congress to wonder why a company accused of defrauding the government would continue to rake in hundreds of millions of dollars’ worth of work.

“Are we looking at a case of too big to suspend?” Rep. Carolyn B. Maloney (D-N.Y.) asked during a congressional hearing last month.

USIS’s “penalty is to continue to let them have a contract with the U.S. government,” Rep. Jackie Speier (D-Calif.) said at the hearing. “I am also concerned that we are wimps in the federal government, that even when we are taken to the cleaners by contractors, we go back for more.”

The company has strongly defended itself, saying that it has a new leadership team and that it has added quality controls to ensure ethics and integrity. Whenever it suspects fraud, the company acts immediately, officials have said.

“USIS has an extensive and costly quality review system, and all of our work is subsequently reviewed by OPM and the adjudicating agency,” chief executive Sterling Phillips, who joined the company last year, said in recent congressional testimony.

Officials said that if the Pentagon does take over the background checks, they would consider relying less on contractors to do the work. The independent review cited the State Department as a model, noting that it relies “on well-trained and experienced case managers who ensure that a sufficiently thorough investigative report is provided” to those who make the final determination on whether a clearance is granted. The State Department “farms out leads” to contractors, who are hired on a part-time basis, the report said.

Such “improvements” would be costly, the report says, especially as the Pentagon’s budget is being cut. Others have said it would be difficult to find and quickly train new manpower.

According to its Web site, USIS has nearly 2,300 investigators across the country.

Sen. Claire McCaskill (D-Mo.), chair of a subcommitee that oversees contracting, said in a statement Thursday that she was “encouraged” that the Pentagon is considering taking over the checks. “Whether these investigations are done by contractors or by the federal government, it’s critical that the process has the right incentives to balance efficiency and effectiveness and, most importantly, aggressive oversight,” she said.

Doing that work would be “a big undertaking” that would give the Pentagon “more control over the process and more accountability,” said Evan Lesser, managing director of “The big question is whether the Department of Defense would merely oversee the process, or if it would own the process from soup to nuts and have federal employees do all of the investigations.”

At the congressional hearing last month, Rep. Darrell Issa (R-Calif.) warned that the federal bureaucracy can be slow to adapt to big challenges.

“I want to be a little careful not to rush to bring everything in-house when, in fact, we’re not very good in the federal government at increasing or reducing workloads the way that” private companies can, Issa said.

The Defense Department was in charge of its own background investigations until 2005, when it had a backlog of about 270,000 people, according to the independent review.

“While DoD failed previously to conduct timely investigations, it now has the benefit of learning from that experience and building on OPM’s efforts,” the review says.