We provide the first thick description of the counter-intelligence function in a command economy of the Soviet type. Based on documentation from Soviet Lithuania, the paper considers the KGB (secret police) as a market regulator, commissioned to prevent the disclosure of secret government business and forestall the disruption of government plans. Where market regulation in open societies is commonly intended to improve market transparency, competition, and fair treatment of consumers and employees, KGB regulation was designed to enforce secrecy, monopoly, and discrimination. One consequence of KGB regulation of the labour market may have been adverse selection for talent. We argue that the Soviet economy was designed to minimize the costs. Zhuravlev, and the referees for advice and comments; Adam Brzezinski and Dimitri Migrow for assistance; the University of Warwick's ESRC Centre on Competitive Advantage in the Global Economy, Vilnius University's Faculty of History, and the Hoover Institution for research support; the Hoover Institution for its generous hospitality and support of the annual Hoover Institution Workshop on Totalitarian Regimes; and the staff of the Hoover Archive for their expertise and boundless patience.