In the early 20th century, the US intelligence began to embrace the idea of a professional intelligence team. The organizational structure of the military intelligence began taking shape. It is during this period that the counterintelligence officers were able to catch German spies in the US. The team was constituted by the FBI and the Secret service. Nonetheless, US the intelligence heavily relied on British allies for information during the First World War.
Herbert Yardley was crucial in laying grounds for the black chamber. The sophistication of the US military intelligence had soared significantly. The federal government funded the MI-8 company aiming to break the telecommunications of other nations in the pretext of commercial code company. The technique was relatively successful as it supplied the negotiators with critical information regarding the Japanese during the Washington Naval Conference. By 1929 the federal government had withdrawn funding of the company.