NEWS

CIA Human Lie Detectors Moonlight for Corporate America

By Matthew Harwood

Some of the CIA's best and brightest have the opportunity to moonlight their unique talents to the highest bidder in the private sector, reports the Politico.

Intelligence sources told Politico that the policy is necessary to avoid a "brain drain from Langley," and that other government agencies have similar policies that allow employees to moonlight in the private sector. This privilege, however, carries tight restrictions, according to the Office of Government Ethics. CIA spokesman George Little told Politico that "If any officer requests permission for outside employment, those requests are reviewed not just for legality, but for propriety."

One Boston-based company founded by retired CIA officers has profitably hired active-duty CIA officers in the past. Business Intelligence Advisors (BIA) sells "deception detection" training and services to high-stakes corporate clients such as Goldman Sachs and the hedge fund SAC Capital Advisors. Deception detection, the paper reports, is an "arcane field" that trains individuals to recognize the verbal and nonverbal cues that indicate someone may be lying. In essence, individuals with this unique skill set are human lie detectors. And unlike lie-detector tests, the people under scrutiny never know they're being evaluated.

While BIA, whose acronym is a play on the CIA, has utilized active-duty CIA officers in the past, the company has not done so recently, BIA President Cheryl Cook told Politico.

Nevertheless, the paper describes one way CIA-trained talent is used to turn a profit in the private sector.

Often, BIA deploys its CIA-trained operatives to analyze quarterly corporate-earnings calls. Those conference calls are an important Wall Street ritual that serves as a direct line from the corporate boardroom to the trading floor.

Companies use the calls to put the best spin on the events of the quarter and give investors a sense of the way ahead. Analysts for top-of-the-line investment houses use them to ask probing questions of senior management.

And BIA uses them to figure out if the company may not be disclosing the truth — all with the help of the CIA-trained analysts.

Politico recounts an incident from 2005 where BIA had its human lie detectors listen in on a quarterly corporate-earnings call from executives from a telecom firm, UTStarcom, that its client was interested in. During the call, the CIA-trained analysts noticed one executive's responses to questions regarding the company's future revenue in the 3rd quarter. The report they generated for BIA's client warned the company would post poor 3rd quarter results.

They were right: UTStarcom's posted poor results and its stock price fell by approximately $2 per share. As Politico notes, information like that is worth a lot of money to hedge-fund investors who can make a lot of money by selling stocks short.
 


♦ Photo by pfala/Flickr

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