SKIRTS AND DAGGERS

By Elaine Shannon/Washington

"Sarah" could have been the perfect spy. She speaks five languages, is an excellent marksman and did well in her counterterrorism course in high-speed evasive driving. She is an expert in international weapons proliferation and economics. She can pass for Mexican, Egyptian, Italian, Indian, Spanish, even Thai. On assignment for the CIA in the Third World, Sarah, decked out in dangling earrings and tight-fitting pencil jeans, foiled surveillance by fading into hooker-infested back alleys. She has sat primly in "love hotels" taking notes as informants rattled on about the doings of a terrorist cell. Sarah should have been the perfect spy. But her boss had other ideas. He assigned her to a desk job and escort duty for junketeering congressional wives. "I've dealt with some real lowlifes," she says. "But my supervisor was more of a sleazebag than any of the men I met. They treated me with respect; he stared at my legs and gave me bad assignments."

Now Sarah is striking back. She and eight other women -- all clandestine intelligence officers -- have filed a sexual-discrimination class action against the Central Intelligence Agency's alite Directorate of Operations -- the service that gathers intelligence overseas. The CIA has answered the charges with an offer of a collective settlement that includes $940,000 in back pay plus promotions and "career enhancing" assignments. The plaintiffs say that is insufficient.

The lawyers who first negotiated the settlement for the women contend that more than 100 female case officers, now overseas and undercover, have telephoned in their support for the agreement. "This agreement is not a panacea," says Joseph M. Sellers of the Washington Lawyers' Committee for Civil Rights. "It will not change overnight what has been decades of entrenched nepotism and connections developed through an old-boy network. But I think it is a very good first step, and it holds real promise to bring that insidious process to an end over time." Unconvinced, the plaintiffs have engaged a new lawyer -- former CIA analyst Michael P. Kelley -- and hope to persuade U.S. District Judge Albert Bryan this Friday to spike the agreement and send the agency back to the bargaining table.

Sarah, "Diane" and the other Directorate operatives who organized the lawsuit spoke with TIME, using aliases unknown to the agency for fear of retaliation. They say neither money nor the remedial promotions will fix the more profound problems within the DO. The CIA also insists on retaining the right to deny women certain overseas assignments when Western notions of gender equality collide with what the agency believes to be the practical considerations of running spies in male-dominated societies. Says a male former DO official: "Female case officers can't drive cars in Saudi Arabia. In Latin America, if a female officer serenades a Don Corleone, the first thing he tries to do is get her in the sack."

The women counter that such concerns are exaggerated -- and some of their male colleagues agree. "Women worked very well in Latin America," says "Mike," a covert paramilitary specialist. "In a lot of cases their informants are looking to unload on someone. They've got a story to tell, and they actually feel more comfortable telling a woman. They're macho, but they're also paternalistic, thinking 'maybe I can help her,' or 'I'm going to impress her, and how much more can I get for her.' That works to a woman's advantage."

With her advanced degree, law-enforcement experience and highly rated "persuasive skills," Diane finished near the top of her CIA training class. Posted to a Soviet-bloc country, she was so good at evading surveillance that headquarters gave her the sensitive job of meeting moles. She once hiked for miles across frozen fields to collect documents from a frightened communist official. "You look into the eyes of a man on a cold, snowy night, and you realize this guy has risked his life to come and give you this information," she says. The man's face had flooded with relief when he sensed that she had done her job right and no one had followed her. She was worried that the next case officer to pull the assignment would not take so much care. "I saw a lot of sloppiness and corner cutting. There were lazy officers who wouldn't have ditched the car, who wanted to get home in a hurry."

Back at the office, however, Diane was in trouble with jealous and influential colleagues who regarded her mission as a game from which they had been excluded. One day she was given an airplane ticket to Washington and ordered to report to the CIA medical staff to answer questions about an alleged drinking problem. Doctors at Langley quickly exonerated her. Their records reflected that the false charges had been levied by a supervisor. "I had been told by another woman case officer, 'Watch out for him, he'll get you,'" she says. And he eventually did. At her next two posts, in Western Europe, she was denied jobs where she could recruit informants. Without sufficient recruits, Diane's job ratings slid and she was dispatched to headquarters. "I'm just treading water," she says. "The DO lives and dies on recruitments. It's a scalp hunt."

Female officers are especially hard hit, they say, because DO managers tend to typecast male case officers as recruiters and relegate women to lower-status "handling" jobs, in which they debrief, nurture and pay previously recruited agents. The women contend that the skill of coaxing sensitive data out of skittish informants ought to be at least as valued as a knack for striking up acquaintances.

Worse, they say, officers laboring under recruit-or-perish pressure tend to sign up large numbers of marginal sources. "People go out and recruit assets that don't produce," says Lynn Larkin, who spent eight years as a CIA case officer covering Czechoslovakia and Western Europe. As an unmarried woman, Larkin says she was pressured by her station chief to stop dating a fellow American, even though he had a security clearance. She resigned in disgust 18 months ago, after a married Directorate executive invited her to lunch, announced, "I can help your career if you stick with me," and then pressed Larkin against her car with his body. The DO, says a former top CIA official, "is almost a whole generation behind in its thinking."

Younger intelligence officers, male and female, call DO veterans "dinosaurs" and "knuckle draggers" -- referring especially to the paramilitary specialists whose careers began during the Vietnam War. "They don't have the education or scientific background to compete in the present," says Sarah. "They don't treat the new technology types well. I had a boss who never changed anything I wrote because he didn't understand it."

Last December the CIA agreed to pay a $410,000 settlement to former Jamaica station chief Janine Brookner, who had charged, in a highly publicized case, that the agency had falsely accused her of sexual promiscuity and alcoholism after she turned in her male deputy for beating his wife. As it turned out, Brookner had been one of the few Directorate officers who had tried to get Aldrich Ames fired for security breaches, 10 years before the FBI unmasked him for selling secrets to the KGB. As part of Brookner's settlement, the agency promised her a letter of recommendation in exchange for her silence on the details of the case. However, says Victoria Toensing, Brookner's lawyer, the agency insists that the letter remain in her classified personnel file and thus inaccessible to any potential employers because she is still considered "undercover." When CIA spokesman Mark Mansfield was asked for the whereabouts of the recommendation, he declined to answer, stating, "The agency has complied with all the provisions of the settlement agreement."

John Deutch, who took the helm of the CIA last month, is eager to put the sex-discrimination issue behind him. Improving the lot of women at the agency "is a big deal for me," Deutch told reporters after he took his post. "I will be pushing that very hard." Deutch has appointed former Navy Assistant Secretary Nora Slatkin to the No. 3 position in the agency; she vows to make "the glass ceiling a glass floor." Deutch's arrival is being greeted with cautious optimism by the women DO officers suing the agency. Deutch is saying all the right things, Diane explains, but "we've heard it from the last two directors, and nothing really changes."

--WITH REPORTING BY DOUGLAS WALLER/WASHINGTON

With reporting by DOUGLAS WALLER/WASHINGTON