‘Missing’ top-secret Los Alamos disks never existed

WALNUT CREEK, Calif. – Two top-secret computer disks reported missing from Los Alamos National Laboratory in July, which resulted in a complete shutdown of lab operations, never actually existed.

Separate investigations by the Department of Energy and the FBI found that the disks never were created, according to a DOE memorandum dated Jan. 21 and acquired by the Contra Costa Times on Friday.

“We conclude that the allegedly missing disks never existed and no compromise of classified material has occurred. Bar codes were entered … in anticipation of the creation of disks that were, in fact, not created,” deputy energy secretary Kyle McSlarrow wrote in the memo to Secretary of Energy Spencer Abraham.

“The difficulty in accounting for classified material is a symptom of a much broader disease of failure to follow procedures,” McSlarrow wrote.

The University of California is being punished for “unacceptable” performance in managing the lab due to problems with the way classified media such as computer disks were handled, according to a report released Friday.

UC’s 2004 management fees were slashed by the National Nuclear Safety Administration, the DOE’s nuclear oversight arm. UC will get only a third of the money it was eligible to collect for managing the lab during the last fiscal year – $2.9 million of a possible $8.7 million. Last year, UC earned $6.8 million of a possible $8.7 million.

The disk incident, along with a safety blunder involving a student intern who was inadvertently hit in the eye with a laser, resulted in an “unsatisfactory” rating for operations at the lab.

“The major weaknesses in controlling classified material revealed by this incident are absolutely unacceptable, and the University of California must be held accountable for them,” said NNSA Administrator Linton Brooks .

Normally, UC receives a $3.5 million flat fee and up to $5.2 million more based on performance.

UC has run the New Mexico lab since its inception in 1943. In 2002, after a string of security lapses and accounting errors, Congress forced the DOE to put the management contract for Los Alamos up for bid. The current contract expires on Sept. 30, and the DOE hopes to award the new contract this summer.