EMBARGOED FOR 3 P.M. RELEASE                                   AG
FRIDAY, FEBRUARY 4, 1994                           (202) 616-2771
                                                                 





   ATTORNEY GENERAL MAKES KEY ESCROW ENCRYPTION ANNOUNCEMENTS



     Attorney General Janet Reno today announced selection of the
two U.S. Government entities that will hold the escrowed key
components for encryption using the key-escrow encryption method. 
At the same time, the Attorney General made public procedures
under which encryption key components will be released to
government agencies for decrypting communications subject to
lawful wiretaps.


     Key Escrow Encryption (formerly referred to as "Clipper
Chip") strikes an excellent balance between protection of
communications privacy and protection of society.  It permits the
use in commercial telecommunications products of chips that
provide extremely strong encryption, but can be decrypted, when
necessary, by government agencies conducting legally authorized
wiretaps.  Decryption is accomplished by use of keys--80-bit
binary numbers--that are unique to each individual encryption
chip.  Each unique key is in turn split into two components,
which must be recombined in order to decrypt communications. 
Knowing one component does not make decryption any more feasible
than not knowing either one.

     The two escrow agents are the National Institute of
Standards and Technology (NIST), a part of the Department of
Commerce, and the Automated Systems Division of the Department of
the Treasury.  The two escrow agents were chosen because of their
abilities to safeguard sensitive information, while at the same
time being able to respond in a timely fashion when wiretaps
encounter encrypted communications.  In addition, NIST is
responsible for establishing standards for protection of
sensitive, unclassified information in Federal computer systems. 






     The escrow agents will act under strict procedures, which
are being made public today, that will ensure the security of the
key components and govern their release for use in conjunction
with lawful wiretaps.  They will be responsible for holding the
key components: for each chip, one agent will hold one of the key
components, and the second agent will hold the other.  Neither
will release a key component, except to a government agency with
a requirement to obtain it in connection with a lawfully
authorized wiretap.  The system does not change the rules under
which government agencies are authorized to conduct wiretaps.

     When an authorized government agency encounters suspected
key-escrow encryption, a written request will have to be
submitted to the two escrow agents.  The request will, among
other things, have to identify the responsible agency and the
individuals involved; certify that the agency is involved in a
lawfully authorized wiretap; specify the wiretap's source of
authorization and its duration; and specify the serial number of
the key-escrow encryption chip being used.  In every case, an
attorney involved in the investigation will have to provide the
escrow agents assurance that a validly authorized wiretap is
being conducted.  

     Upon receipt of a proper request, the escrow agents will
transmit their respective key components to the appropriate
agency.  The components will be combined within a decrypt device,
which only then will be able to decrypt communications protected
by key-escrow encryption.  When the wiretap authorization ends,
the device's ability to decrypt communications using that
particular chip will also be ended.

     The Department of Justice will, at the various stages of the
process, take steps to monitor compliance with the procedures.