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In early-mid 1999, the Department of Internal Security, by then an enormous, corrupt instrument to enforce the will of the Mysterious Somebody and Bracket Fungus, purchased a number of Daleks and brought them into Headquarters, enlisting the aid of the Bindweed in covering up the transaction; as the Bindweed was the new head of the Department of Finance, she was easily able to delete any records of their having come to HQ. Ensuring the Daleks' compliance by fitting portal devices to their suits, which were set to immediately portal them to the bottom of an ocean if they turned on their new masters, the DIS held onto them in secret as their reign of terror continued and tensions rose in HQ.

While the Mysterious Somebody was expelled from HQ in June, the DIS was not removed from power and in fact aided C'baoth in secret, allowing him to take over the abandoned Mary Sue Factory. Their grip over the agents continued to tighten, until Jay Thorntree, dragging Jared Calinson along, instigated a revolt against the DIS that murdered a number of Guards. When the Bracket Fungus demanded an explanation from the Sunflower Official, the SO disclaimed any knowledge or involvement, but the BF still sent Twp'atwt, Ontic Laison and Nendil Morifëa to assassinate him; with Nyx Nightingale's help, however, he defeated his attackers and subsequently declared war on the DIS. Fighting the massed forces of the PPC, the Guards had suffered unsustainable losses within half an hour of the start of hostilities, at which point the Bracket Fungus chose to unleash his secret weapons at last, to devastating effect; the Daleks exterminated anything they encountered that wasn't DIS, eventually driving much of the SO's force into hiding.

Despite the urging of Mortic Wentway, Jay chose not to run, instead coming up with a plan to fight back. Inspired by the defeat of the Dalek in The Five Doctors, which had been killed after its energy weapon ricocheted off of the walls in an enclosed area, she, Jared, and some others lured a massed force of Guards and Daleks into a corridor, where they formed a shield wall from an assortment of tall mirrors they'd found in a storehouse and allowed the Daleks to open fire. The gunsticks' beams were reflected back at the Daleks, who ended up destroying themselves and many of the Guards with them, and with their trump card defeated, Nendil Morifëa sounded the call for the DIS to retreat from HQ, ending the war.