Secret Messages by U.S. Spies Anger Envoys

Bad blood between American diplomats and spies in the Balkans grew into a secret but nasty turf war this year in which the State Department’s diplomats tried--without success--to gain access to top-secret communications between the CIA and its field officers, according to senior Clinton administration officials.

Deputy Secretary of State Strobe Talbott and other senior State Department officials sought to force the CIA to agree to new rules that would give a U.S. ambassador the right to see virtually all messages being sent back to CIA headquarters by the CIA’s station chief in that country.

In effect, the State Department failed in an attempt to end the CIA’s ability to communicate privately and independently with its undercover officers.

On one level, the struggle is a story as old as Washington itself--a bureaucratic war over power and territory. But more broadly, the tug-of-war shows how a wounded CIA is now straining to maintain its once-prominent status within the national security community. With the CIA injured by scandal, low morale and the absence of a clear mission in the post-Cold War world, other bureaucracies believe they can encroach on its once inviolable turf.

Relations between State and the CIA took a decidedly bad turn in 1995 after a controversy involving allegations of human rights abuses by CIA informants in Guatemala.

CIA officers allegedly had failed to keep two successive U.S. ambassadors in Guatemala fully informed about the worsening scandal. That prompted State Department officials to open talks with the CIA about tightening the long-standing requirements for CIA station chiefs to keep their ambassadors informed of their operations.

The battle intensified this year during the outcry over President Clinton’s decision to give a green light to covert Iranian arms shipments to Bosnia. Senior State Department officials were deeply involved in Clinton’s 1994 arms initiative, while their counterparts at the CIA were kept out of the loop.

As the Iranian arms policy became the subject of congressional investigations, the controversy revealed a rift between Peter Galbraith, U.S. ambassador to Croatia, and the CIA station chief in Zagreb.

Galbraith had played a central role as an intermediary in the initiative in 1994, passing on the administration’s secret signal that it would not object to creating an Iranian arms pipeline to help the Bosnian Muslims, who were losing the war to the better-equipped Bosnian Serbs.

But the CIA station chief in Zagreb had suspected Galbraith was going beyond his instructions from Washington and might be actively helping put the arms pipeline in place. So the station chief used the CIA’s secret message channel to report to CIA headquarters in Langley, Va., about Galbraith’s actions. The agency’s clandestine espionage arm has an exclusive, highly classified communications network that connects headquarters to station chiefs around the world and is not accessible to other arms of the government.

At the time, Galbraith was unaware of the extent of the station chief’s secret reports. It wasn’t until last May, while preparing to testify before Congress, that Galbraith was allowed to go to CIA headquarters to read through the agency’s secret cable records.

He told colleagues later that he was stunned. The station chief had sent back inaccurate and misleading reports, he said. He charged that the station chief had been “spying” on him, and doing it badly.

Outraged, senior CIA officers began to fight back, accusing him of unfairly attacking a station chief who had helped blow the whistle on an arms initiative that the administration also had hidden from the Pentagon and Congress. It was an example, they said, of the vital role private CIA message channels can serve in checking the power and authority of U.S. envoys.

Senior officials at State and at the National Security Council supported Galbraith’s charges. State officials said the controversy had a “chilling effect” on relations between ambassadors and CIA station chiefs around the world.

As a result, Talbott and other State officials began pushing harder for changes in communications policies, demanding that ambassadors have a chance to see messages being sent to CIA headquarters by station chiefs working out of their embassies.

CIA Executive Director Nora Slatkin and other CIA officials rebuffed the State demands. But the two agencies did compromise by agreeing to new guidelines requiring CIA station chiefs to keep their ambassadors better informed about ongoing espionage activities, sources said.

State’s initial demands “were impossible,” said a CIA source. “You have to be able to report privately to maintain independence. You also sometimes need a way to report if the ambassador is doing things he shouldn’t. . . . “

CIA officials say they have agreed to only modest policy changes. Station chiefs were told, for instance, to make sure their ambassadors are aware of so-called “third-country” operations--when CIA officers or agents based elsewhere travel into the ambassador’s country to conduct espionage.