Although Warned, CIA Left Ames Alone : Espionage: Senator says the lack of action points up the need to reform the way the agency monitors those who hold sensitive positions.

Nearly four years before Aldrich H. Ames was arrested, CIA security officers received an urgent warning that the now-confessed spy was spending money lavishly but they took no effective action against him, according to a declassified memo released Monday.

Sen. Dennis DeConcini (D-Ariz.), who released the document as chairman of the Senate Intelligence Committee, said that it demonstrates what congressional critics have been claiming for months--that grave reforms are needed in the way the intelligence agency monitors those who hold sensitive positions.

“There’s something big-time wrong with the CIA,” DeConcini said in an interview. “I don’t know that (CIA Director R. James) Woolsey has done anything to cure it.”

According to the document, which DeConcini had declassified after months of effort, the agency’s counterintelligence center advised the office of security on Dec. 5, 1990, that Ames was exhibiting “lavish spending habits” at a time when operations under his control were being compromised.

The memo writer, whose name was blacked out in the document made public, noted that Ames had paid cash a year earlier for a $540,000 split-level home in suburban Virginia, had spent thousands of dollars more on renovating it and had purchased a new $49,500 Jaguar automobile--all on a government salary of less than $70,000 a year.

The memo noted another danger sign: Ames’ sudden wealth had come at a time when a number of operations under his control had been compromised. He had been chief of the CIA’s Soviet-East European division, responsible for several valuable foreign sources who abruptly disappeared and were presumed murdered.

Written when the CIA’s hunt for a suspected Soviet “mole” in its midst had apparently slowed for lack of investigative manpower, the memo said, “We request that the Office of Security open a re-investigation on Aldrich H. Ames and review the records” of his banking transactions. It added that “there is a degree of urgency involved in our request.”

DeConcini said that the CIA security office “did nothing substantial” with the information, and he declared that “the FBI should have been brought in.” The senator is sponsoring legislation to give the FBI a greater role in hunting for domestic moles at the CIA, on the grounds that it has more expertise in this field than the CIA and is not hampered by sympathies for the “old-boy network” of CIA Cold War veterans like Ames.

Ames, who spent 31 years with the agency, pleaded guilty last April to accepting $2.5 million since 1985 in return for giving the former Soviet Union and later Russia the names of their citizens who were valuable sources for the CIA, along with other sensitive data. More than 10 sources were summarily executed.

Ames’ wife, Rosario, pleaded guilty to a lesser charge of assisting his espionage. While Ames is serving a life sentence without chance of parole, Rosario Ames is expected to receive a term of about four years in prison if her husband cooperates with authorities who are questioning him about his past activities.

DeConcini said he hoped that “some substantial changes will occur (at the CIA). They need some new directions and some new people.” The senator said he planned to question Ames soon in prison, but was uncertain whether the committee would call him as a witness.

Kent Harrington, a top aide to Woolsey, said that the document released by DeConcini was one of many the agency has given to Senate and House oversight committees looking into the Ames case. He said that several weeks after the memo was received in late 1990, the agency formed a joint task force with the FBI to investigate Ames and a number of other suspected moles.

“The CIA and FBI shared information fully from the onset of the investigation,” Harrington insisted.

However, it was not until May, 1993, that the FBI felt it had sufficient evidence to place Ames and his wife under full-time surveillance. It was only then that eavesdropping devices were planted in their home and their telephone was tapped. Additional evidence obtained in this manner led to the Ameses’ arrest last February.

Woolsey has told reporters that financial investigations of suspects like Ames have been complicated by the legal necessity to notify suspects that their banking records are being examined. He has asked Congress to change this requirement and to force banks to cooperate more fully in such investigations.

Ames told The Times in a prison interview in May that he was able to finesse his way through a polygraph examination in 1991 and that laxity in the agency eased his access to secrets that he sold. DeConcini said the polygraph operator may not have been given access to all the data on Ames, and thus “did not do a decent job.”