CIA's ineffective network of front companies shrinks

Washington: The CIA set up a network of front companies in Europe and elsewhere after the September 11, 2001, attacks as part of a constellation of "black stations" for a new generation of spies, according to current and former agency officials.

But after spending hundreds of millions of dollars setting up as many as 12 of the companies, the agency shut down all but two after concluding they were ill-conceived and poorly positioned for gathering intelligence on the CIA's principal targets: terrorist groups and unconventional weapons proliferation networks.

The closures were a blow to two of the CIA's most pressing priorities after September 11 - expanding its overseas presence and changing the way it deploys spies.

The companies were the centrepiece of an ambitious plan to increase the number of case officers sent overseas under what is known as "non-official cover," meaning they would pose as employees of investment banks, consulting firms or other fictitious enterprises with no apparent ties to the government.

But the plan became the source of significant dispute within the agency and was plagued with problems, officials said. Their size raised concern that one mistake would blow the cover of many agents. And because business travellers don't ordinarily come into contact with Al Qaida or other high-priority adversaries, officials said, the cover did not work.

Summing up what many considered the fatal flaw of the programme, one former high-ranking CIA official said: "They were built on the theory of the Field of Dreams: Build them, and the targets will come."