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Attorney General and courte. The request mide by the Depsrtaent of the FRI was not incapable of proof, and whether a man 19 @ member of the Communist Party is not | inprovable since the ‘EI has or can penetrate the Party, Therefore, the failure _of the FBI to provid proof wich would stand up was sinply the evidence of the FBI's own administrative Limitations with respect to the work it does without the | | statutory duty. It was pointed out that the FEI investigators were not subject — to direction and control of the Department and their sources could not be evaluated The alternative waa to strengthen the Department's investiyative service ¢ or utilizing more extensively the services of other’ agencies. . seen oe eee erm It was ‘considered desirable that thore be a thorough 8 coordination of ‘the Goverment 's intelligence and counter-intelligence investigations in order to provide the information meded for the direotion of the Department's foreign ard personnel: polictes. Thia would require an understanding with Mr. Hoover, the Attorney General, ard the Director of CIG. It was indtoated that the FBI Appropriations Aot carried |; & provision that investigations should be oondusted on behalf of the Attorney General ani Seoretary of State, It was conceded that there may be practioal difficulties ; in effecting closer direction by the Department over the investigative work of the The accommodation gharacter of the FRI ts perviaa to the Department WA ae TIT gael # Ne TS DT a intolerable and the FBI must perform as a direct sorvige of obligation to the _ Department or the Department could not fulfi11 its obligations, “The Department... ghould explore the possibilities of a closer arrancement with CIG, Yarious casen”: “| ¥ero included in the survey and it was noted that certain individuals were disproved; as ecourlty risks for such reasons aa alcoholi!my, homosexuality, and indiscretion. At the conclusion of the report, recanmendations were made, among whigh was one that more discriminate use should be nade of the investigations conducted. by such agencies as the FRY and the possibility be explored of using additional * agencies such ag the Treasury Department and GIG. Bvery case of a rejection or bed termination on evidence of foreign agency should be &@ cause for counter-intelligence * _ congideration and report to the Department. For this roason, careful reexanimtion i ghould be made of the role of the FRI as an intelligence agenoy serving the Depart‘ _ ment and ‘Proper use of the facilities | of Grd and other agencies for the wane Purpoee. - Ib is noted that a gory of ‘the ‘Klaus report was ‘recently obtained by "th: Burcau from the State Department through liaison. However, on April 2, 1947, there. were obtained through Maison with the State Departaent photostatic ooples of a=; ‘memorandum prepared “by with the State Departuent, entitled "The Story of $ Wad prepare ute the Klaua report. In a memorandum to you from Mrs Ee G. Fiteh on April 14, 1947, @ summary was made of the charges made by Kgaus cono-rning the Bureau, followed by coments of the true faste-. in each instance, At that time the Kraus fe BS was not ae but the nenorsiiun : _ quoted pertinent portions of ua repo eg NS Beg ise Pelee wae 62-39749=BAT: ; = : s. & ad tag ‘check: ‘te being wade to ‘detornine whether any’ rd ‘the ‘Gnitvidvaie nan Cle_fiwu thao itn ae Stuiteast Gantinn af the Fraud rancor ara presently anplaved in the ; et Wa Wage tL wie ee ok. ae ed ee 2 Se 2 ae Ss a ss eederal Goverment, If {& 16 determined that they are etill copleyed, * Appropriate | Michels reo SOCTON wil be taken under Bxoouti ve Order aber HO5~ . Tele, Room ; Wot ot AE wee PEROT RE SOD TW ee ye ey og