hearing

12021 December 1954M4MRADUM FOR:Director of Central IntelligenceSUBJECT Project INULTRA, Subproject 351. While the Director's statutory authority to expend fundsfor confidential purposes is not limited by law, we believe thata gift of Government funds as such would exceed the intent of theCongress in granting that power. Hoever, where a gift is madefor the express purpose of producing something of value to thisAgency which cannot ctherwise be obtained and there is a reasonableexpectation that the value may be received, the gift may ineffect be an expenditure for proper official purposes.2. In Subproject 35, it is stated that.the donation inquestion would achieve certain ends desired by TSS. There seemsto be no question that those ends would be advantageous, so themain questions appear to be whether they could not be attainedby more direct, normal methods, and, if not, whether the returnis necessary and reasonable in relation to the donation.3. We are in no position to review the requirements of TSSor to appraise the advantages that would result from this project.We do not comment, therefore, on the value received if'theproject results in the benefits foreseen. We feel we shouldcorment on factors affecting the probability of achieving thoseends. In a legal sense, there is little or no control. Oncethe funds are donated, the individual, his foundation, or thehospital could conceivably refuse to work for us or allow us theuse of the facilities.4. Practically, the control seems to be established as wellas circumstances permit. Certainly, as long as the individual isalive and in his present position, we have every reason to expecthis complete cooperation in the future as in the past, unlessthrough scoe act or fault of our own he is alienated. Even in theevent of his death or incapacity, there appears to be a reasonableDCopy#d1d to:of1copby authority If: !87475 A*~ao:.~ns1977 -.a 7; La134 Copy #1 ofil copy