The recent stop-work order that has prevented a major U.S. contractor from conducting background investigations could significantly impact the security clearance process, especially if it lasts for an extended period, industry officials said.
The stop-work order was issued Aug. 6 after USIS, the Falls Church, Va.-based company that does the bulk of the federal government’s contracted investigations, was hacked, potentially exposing the records of thousands of government employees.
Since then, the two agencies that suspended the work have been trying to shift the investigations to other contractors, or do them in-house, the Office of Personnel Management said in a statement.
But cases that had been assigned to USIS are “pending completion,” the OPM said. And the stop-work order can remain in place for up to 90 days.
About 2,000 USIS employees have been furloughed, said a person familiar with the situation who was not authorized to discuss the company publicly.
The company’s caseload was significant, averaging about 21,000 background checks a month. USIS, which conducted background clearances for National Security Agency leaker Edward Snowden and Navy Yard shooter Aaron Alexis, has come under criticism for churning through investigations and cutting corners.
But without USIS to perform the work, some fear that there will inevitably be a growing backlog of cases.
“USIS has been really at the forefront of doing security clearance investigations for many years now,” said Evan Lesser, co-founder and managing director of ClearanceJobs.com. “And shutting them down or pulling them out of the picture is going to cause delays — not just in new clearances but reinvestigations.”
USIS has said that the breach “has all the markings of a state-sponsored attack,” and it was working with the agencies and federal law enforcement authorities “in redoubling our cybersecurity efforts.” It declined to comment further.
Alan Chvotkin, executive vice president of the Professional Services Council, an industry group, said that the longer USIS is sidelined “the more significant the impact.”
“Every day new investigation requests come in,” he said.
To mitigate the impact, the OPM is “shifting the fieldwork previously done by USIS to other contractors and federal staff as appropriate,” the agency said. “While this may cause a delay for some investigations as we make the adjustments, we are working to minimize any delays and we remain committed, first and foremost, to the security and quality of our background investigations.”
The OPM has the ability to do some of the investigations itself. Two other contractors — CACI and KeyPoint Government Solutions — also do investigations for clearances. Neither responded to requests for comment.
The Department of Homeland Security is the other agency that issued a stop-work order. It referred questions to the OPM.
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, more work went to KeyPoint and CACI. KeyPoint’s payments jumped from $85 million to $138 million; CACI’s rose from $17 million to $46 million.
USIS has had a long history of performing background checks for the government. The company was created when it was spun off by the OPM in an unprecedented privatization plan during the Clinton administration in the mid-1990s. It has been performing the checks ever since.
The company was recently accused of speeding through a mountain of investigations as the wars in Iraq and Afghanistan fueled a heightened demand for cleared workers. A whistleblower lawsuit that has been joined by the Justice Department accuses the company of submitting 665,000 background checks that were incomplete.
Since then, members of Congress have asked why the government continues to rely on the company to perform such a sensitive task. The company has said that since the allegations came to light it has implemented stricter controls under a new management team.