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Summary
SpecTal was founded by a group of former CIA officers in the late 1990s to take advantage of a sudden spike in intelligence contracting during the last years of the Clinton administration. After 9/11, it found itself in high demand. SpecTal employs more than 325 people, most of whom are former CIA and defense intelligence officials (the company says its employees are veterans of the CIA, the Defense Intelligence Agency, the National Geospatial-Intelligence Agency, the National Reconnaissance Office, the FBI, the Department of State, and other federal agencies). Ninety-five percent of them have top-secret security clearances or higher. According to the company’s website, its staff includes the former chief of intelligence for the CIA Directorate of Operations and the former CIA deputy director for development of policies for collection, dissemination, and sharing of intelligence.
“After 9/11, SpecTal was there with the right experts at the right time and the right place,” VirginiaBusiness.com reported in 2006. [1] “Intelligence and federal law enforcement agencies needed to rapidly gear up to fight a global war on terrorism. Officials filled their gaps in expertise by turning to companies with the right blend of skills and resources. SpecTal fit the bill perfectly and quickly became a preferred vendor.” In 2006, SpecTal shot to #1 in VirginiaBusiness.com’s “Fantastic 50” annual list of the state's fastest growing companies, with a 4002 percent increase in revenue between 2001 and 2006 (that’s four thousand percent, not four hundred!). It is now owned by L-1 Identity Solutions Inc., the biometric specialist and intelligence contractor run by defense investor Robert V. LaPenta.
Corporate Information
HISTORY. SpecTal was founded in 1999 by a husband and wife team, John and Louise Cross. It functioned “as a very small business providing consulting services to the intelligence community” until the couple decided to slow down in 2002. [2] They hired three executives from Electronic Data Systems (EDS - the data processing firm once owned by Texas investor Ross Perot). The new execs took the company into new areas, including participating as contractors in covert operations in Afghanistan. As part of the larger company L-1 Identity Solutions, executives say, SpecTal will “enhance” L-1’s “product line” for counter-terrorism [3], for example, “assist[ing] with future development of the HIDE device. Produced by L1's subsidiary, Securimetrics, HIDE is used in Iraq by the U.S. government. The mobile device captures biometric information and transmits it back to a database to verify a person's identity. (Securimetrics on Aug. 10 [2006] received a $10 million DoD contract for the devices.).”
SpecTal’s website reads like something out of a spy novel: “From the situation rooms of Washington, D.C., to the back alleys of the Third World, SpecTal employees have devoted their lives to handling America’s most daunting security and intelligence challenges,” it states. SpecTal explains that it provides “a wide range of analytical, linguistic, technical, and other support to intelligence, defense, and law enforcement agencies. We can augment your team with proven and cleared personnel and/or provide specialized training to your current staff. In many cases, we are veterans of your organization and understand your needs and organizational culture.”
In other words, many of its employees are former intelligence officers who go back as contractors to the same agencies they used to work. SpecTal emphasizes that it provides key expertise in the business and management of intelligence. It recently established a “SpecTal Center for Excellence in Intelligence Management (CEIM)” to focus on training intelligence agents in disseminating information. “Our expert team has experience in multiple IC agencies crafting new intelligence dissemination procedures, training reports and requirements personnel, validating and vetting information and its sources, and ensuring the protection of sources and methods. The CEIM is a company-wide resource that can be called upon to provide ad hoc consulting services or permanent staffing for any of our customers at any time.”
CorpWatch Analysis
SpecTal was an interesting choice for L-1. Prior to its acquisition, SpecTal was working closely with the CIA in Afghanistan on a number of classified missions that George Tenet, as CIA director, was apparently quite familiar with. In November, 2006, several L-1 executives met with Tenet to discuss potential business in Afghanistan. During the course of that conversation, LaPenta told investors, Tenet urged L-1 to “call the SpecTal guys” because “they know everybody in every one of these ministries that you need to go talk to.” [4] Tenet is now an L-1 director. In May, 2007, L-1 picked up another intelligence contractor, Advanced Concepts Inc. (ACI), where 80 percent of the 300 employees have top-secret clearances. ACI, according to LaPenta, is a systems engineering firm that, among other things, protects computer systems for the National Security Agency, making it “a great compliment for SpecTal.” [5] By combining the two companies, LaPenta told analysts, he hoped that SpecTal might get some of its “training and analysis and ops people” hired at the NSA, and get work for ACI’s IT and systems people at the CIA.
Recent Contracts/Events
In October 2006, SpecTal was acquired by L-1 for $100 million. SpecTal is now operating as an L-1 unit out of a 15,700 square foot office building it leased in Reston, Virginia, in a deal that expires in March 2012.
SOURCES
Primary sourcing for this profile came from Tim Shorrock, ''Spies for Hire: The Secret World of Intelligence Outsourcing'' (Simon & Schuster/2008) and from DIA and company press releases.
[1] “Government intelligence needs spur SpecTal to the head of the list,” VirginiaBusiness.com, May 2006.
[2] “Government intelligence needs spur SpecTal to the head of the list,” VirginiaBusiness.com, May 2006.
[3] “L1 to acquire SpecTal for $100m,” Security Systems News, Sept. 14, 2006.
[4] L-1 Identity Solutions, Inc., Analyst Meeting transcript, November 2, 2006.
[5] L-1 Identity Solutions, Inc., Earnings Conference Call, May 9, 2007 (available on the SEC website).
