Irvine Firm Seeks to Help Keep U.S. Secrets Secret

Times Staff Writer

As the super-secret National Security Agency makes a push to protect its computer and telephone communications from electronic thieves, a tiny Irvine company is playing a quiet role in developing devices to protect the agency’s secrets.

Codercard, a maker of computer security devices, is one of three companies under contract with the NSA to design special data encryption devices for computers and other electronic equipment. Codercard officials said the company was selected for the contract in July, but NSA restrictions have prevented the firm from talking about the program until recently.

Codercard is working under a “zero-dollar” contract, which means it receives no research and development funds from NSA, said Bob Gray, Codercard’s director of federal systems. Under the contract, the company works closely with the NSA to build the equipment to agency-approved security standards, Gray said.

The NSA is expected in early 1989 to approve one or more security devices for use by the government, Gray said. If Codercard’s device wins approval, the company would be in a position to grab a share of a potentially lucrative market.


“The Defense Department wants to put these devices on all terminals that have access to military computers,” Gray said. “So you can see how big the potential is.”

Optimistic of Approval

Codercard officials said they are optimistic they will win agency approval.

“The NSA approves every detail of this design,” Gray said. If a company builds the product to NSA’s satisfaction, it is likely to receive a contract, he said.


An NSA spokesman declined to discuss specifics of the program but confirmed that Codercard is among the companies working on aspects of the Low-Cost Encryption Authentication Device program. Two Virginia firms, ACS Communications Systems and Pailen-Johnson Associates, are also working on building a shoe-box-like black box that will attach to computers, terminals and data communications gear.

The devices will be used to ensure that only authorized people gain access to defense computers. Information transmitted by workers using personal computers will be encrypted--converted to a secret code--to foil hackers trying to break into the system.

The NSA, which eavesdrops on computer and phone communications around the world, has been making a push to tighten security following some highly publicized break-ins at defense installations.

Last August, Codercard received government approval to start marketing a computer security device to banks and other financial institutions that transfer funds electronically. The device is similar to the one Codercard hopes to sell to the NSA.