The Security Service was formed on 31 March 1941 as part of the Attorney-General's Department. It assumed the national security activities previously carried out by the Army on behalf of the armed services, though the Army retained responsibility for internment and censorship matters and for civil and internal security in the Northern Territory and northern Western Australia.
 
The Security Service was constituted as part of the Attorney-General's Department but the heads of the State offices of the Service, except for South Australia, were all Army officers. In Perth, Hobart and Darwin the offices operated within the General Staff's Intelligence Section.  

The first Director of the Service was Lt Colonel E E Longfield Lloyd, Deputy Director of the Investigation Branch (CA 747). Initially the
Service had only investigative and reporting powers. The executive power to deal with subversion remained with the Attorney-General, while the control of aliens remained with the Generals commanding the military districts in each state.
 
After a report on the Security Service was presented by Mr Alexander Duncan in January 1942, a conference of the Attorney-General and the Ministers of these services decided that a Director-General of Security should be appointed with executive and investigative authority. On 17 March 1942 W J Mackay, NSW State Commissioner of Police, was appointed as Director-General of Security, replacing Longfield Lloyd. The Director-General was given new investigative and executive powers. These included:
 
 . investigation, surveillance, prosecution and internment against
   hostile, alien, subversive or pacifist organisations and
   individuals;

 . dealing with sabotage;

 . control of the issue of visas and passports;
 
 . control of passengers and crews of vessels and aircraft entering
   Australia;

 . security of information, the prevention of harmful rumours and
   collation of overseas security information;

 . security of wharves, ships and establishments engaged in war   
   production;

 . security checking of personnel; and

 . radio security measures and radio interception.
 
As a result the Investigation Branch was restricted to departmental investigations and confidential inquiries outside the security field. The Security Service included representatives of Britain's MI5, the US FBI and of the US Military Forces in Australia. The
Director-General of Security was able to draw on a secret fund for security purposes.
 
Mackay was replaced on 23 September 1942 by Brigadier W B Simpson. In September 1943 the Service comprised 678 members. Fifty-five percent of these were Army personnel seconded from the Army, paid by it and subject to Army discipline. They were members of a specially created unit, the Security Service Australian Intelligence Corps. The rest were drawn from police, civilians, the Air Force and the Navy. In August 1944 there were 530 staff: 312 Army members, 38 administrative officers, 46 investigators and 134 clerks, typists and records officers. Simpson retired from the Army on 16 September 1944 but remained as Director-General until his appointment as a Supreme Court Justice on 24 October 1945. Longfield Lloyd was appointed as
Director-General of Security on 25 October 1945.
 
As at September 1945 the main functions and sections of the Service were:
 
 (i) Counter Espionage and Counter Sabotage Section:
 
     This section dealt with the finding of enemy agents within     
     Australia or, in association with kindred bodies, overseas;
     tracing within Australia the association of known enemy
     agents in other parts of the world; and with collecting evidence
     and watching the associations of traitorous Australians
     within Germany, Italy or Japan. The Section was concerned also
     with the taking of adequate measures to prevent sabotage by
     enemy agents.  

 (ii) Subversive Organisations Section:
 
      This section dealt with the collection and collation of      
      information in relation to any organisation likely to be      
      subversive, whether of alien or domestic origin.
 
 (iii) Aliens Control Section:
 
       This section dealt with the registration of aliens and the
       enforcement of the National Security Regulations relating
       to aliens.
 
 (iv) Internments, Releases and Restrictions Section:
 
      This section dealt with the issue of detention and restriction
      orders under the National Security Regulations and the policing
      thereof.
 
 (v)  Leakage of Information Section:
 
      This section dealt with the prevention of leakage of vital
      information to the enemy from all sources and, with the      
      assistance of Publicity and Post and Telegraph Censorship      
      authorities, in handling cases where the Regulations had been
      contravened.
 
 (vi) Seaport and Airport Control Section:
 
      This section's prime responsibility was the checking of all
      persons entering and leaving the country, whether by sea or
      by air, and by that means picking up any enemy agent
      entering the country from overseas, and preventing the
      departure of any known or suspected agent. Through this  
      Section,  Security Service was  able to maintain close
      collaboration with kindred organisations in the Allied
      countries.
 
 (vii) Asiatics and Chinese Sections:
 
       The work of these sections was similar to that of the Aliens
       Control Section but the sections were set up separately to   
       to deal specially with Chinese and other Asiatics because it
       was envisaged that it was from these races that the Japanese
       agent was most likely to come.  They dealt also with the large
       number of Aisatic evacuees and recovered prisoners of war.
 
(viii) Legal and Miscellaneous Section:
 
       This section was concerned largely with giving reports to the
       Armed Services on people of Australian origin whom the Armed
       Services, including the Americans and the Royal Navy, desired
       to employ in positions of a highly secret nature. It also
       prepared cases for prosecution for breaches of those National
       Security Regulations for the administration of which the
       Director-General was responsible.  

 (ix)  Radio Security:
 
       This section was concerned with monitoring the radio bands
       bands in the search for illicit wirelesses.  It employed a
       number of monitors who are provided by the
       Postmaster-General's Department and by special units of the
       Army Corps of Signals.  The numbers have not been included in
       the staff totals referred to earlier as the individual
       monitors were paid and employed by their own Departments,
       working only under the operational control of the
       Director-General. It also monitored certain enemy stations for
       Army (Operational) Intelligence.
 
  (x)  Administration Section:
 
       This section dealt with all administrative matters including
       records, accounts, etc.
 
The Security Service was disbanded on 15 December 1945.  Its functions and powers were absorbed by the Security Section of the Commonwealth Investigation Branch (CA 747) except for the control and registration of aliens, which was assumed by the Department of Immigration (CA 51).  

Sources:
 
C D Coulthard-Clark "Australia's Wartime Security Service"
Defence Force Journal No.16, May/June 1979  

Committee of Review -  Civil Staffing of Wartime Activities, Report
on Security Service, 13 September 1945
 

Historical agency address
Patents Office Building, Barton ACT