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The Defense Department plans to remove the government key escrow software from its Fortezza cards used on the Defense Message System a move that signals the death of the Clinton administration's controversial Clipper initiative and one that should encourage civilian use of the cryptographic cards.

A DOD spokeswoman confirmed the decision to remove the key escrow but would not provide further details.

The DOD decision which will be formalized in a policy expected out shortly is in response to the administration's decision last October to support key recovery technology instead of the controversial Clipper initiative. Each agency must decide how it will implement the government's policy internally. A technical advisory committee will develop standards for a federal key management infrastructure.

The so-called Clipper initiative proposed a nationwide standard for encryption hardware that would have used a classified algorithm with built-in law enforcement access. It is this built-in access - which law enforcement agencies claimed was vital to their jobs - that will be removed from the cards. It most likely will be replaced by emerging commercial key recovery technology that does not have the same built-in access.

DOD has for years pressured civilian agencies to use government escrow technology but the agencies were wary of the law enforcement access.Stephen Walker president and chief executive officer of Trusted Information Systems Inc. (TIS) said the policy will remove the last remnants of the Clipper and serve as an official endorsement of key recovery technology.

"This is the end of Clipper " Walker said. "This is a very positive move because it puts the Defense Department in a posture of using commercial products instead of Defense Department products. If the Defense Department is moving away from key escrow no one else is going to feel obligated to have key escrow either."

Civilian Agency Appeal?

Removing government key escrow from Fortezza cards which are designed to provi de authentication integrity and confidentiality to DMS users could prompt civilian agencies to deploy the cards to secure electronic mail or other communications said Santish Chok-hani CEO of Cygnacom Solutions a security consulting company.

"If you take out the key escrow from Fortezza that would mean a broader set of civilian agencies and commercial folks could use the technology without worrying that someone is copying their keys " he said.

The main difference in government key escrow - now in place in Fortezza cards - and key recovery technologies is the ability of law enforcement agencies to secretly decrypt encrypted files after obtaining a warrant.

There is a private key (needed to decrypt data) embedded in each Fortezza card chip. When the Fortezza chip is manufactured the private key is split one half goes to the National Institute of Standards and Technology and the other to the Treasury Department.

If a law enforcement agent obtains permission from a court to decrypt informa tion of a Fortezza card user he can obtain both parts of the private key from the two federal agencies and decrypt the data without the knowledge of the user.

Key recovery is a technology that allows for the recovery of a private encryption key if it is lost or damaged. This private key however is kept by the user or user's organization not by government agencies. Law enforcement agencies still can obtain a warrant for a user's private key but they could not secretly decrypt the information without the user's knowledge.

Sources said DOD's move was targeted to increase the appeal of the Fortezza card to users outside DOD.

Bruce McConnell chief of information policy at the Office of Management and Budget said the move would make Fortezza cards more attractive but he cited different reasons. "It does encourage people to use it because it moves toward the commercial approach that's being taken " he said.