Tracking Terrorism Through Financial Records
Friday, June 23, 2006PAUL KANGAS: A U.S. Treasury official says investigators may have conducted hundreds of thousands of searches of international banking records. The disclosure follows reports the U.S. is secretly tapping into financial records as part of its program to track terrorist financing across borders. Washington bureau chief Darren Gersh reports.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: The Treasury says the American people can be proud of its program to track terrorist financing, calling it legal and narrowly targeted.
JOHN SNOW, TREASURY SECRETARY: By following the money, we`ve been able to locate operatives. We`ve been able to locate their financiers. We`ve been able to chart the terrorist networks, and we`ve been able to bring the terrorists to justice.
GERSH: The Treasury now confirms it taps into data provided by the international banking consortium known as Swift. Swift is not a bank; it`s a messaging service almost all financial institutions around the world use to transfer money across borders. The Treasury says it only searches Swift data on individuals thought to be connected to terrorism. But a leading Democratic privacy advocate was quick to call the program unconstitutional.
REP. EDWARD MARKET (D) MASSACHUSETTS: The Bush administration wants to be free to put out a digital dragnet for all financial information without having gone to a court to get a legal right to be able to compromise the privacy of Americans in our country.
GERSH: The Treasury says all searches were also reviewed by outside auditors at Booz Allen, although that is unlikely to reassure many foreign banks.
BERT ELY, FINANCIAL CONSULTANT, ELY & COMPANY: My concern is that they may have a very negative reaction and will want Swift to take steps to protect their transaction data from being observed, shall we say, or examined by the U.S. authorities.
GERSH: Experts in international financial crime say foreign banks may have few options since the United States is central to the global financial system and there are numerous international agreements exempting terrorist financing from privacy rules.
JONATHAN WINER, INTERNATIONAL FINANCIAL CRIME EXPERT, ALSTON & BIRD: The bank secrecy act is all about the fact that when the government has legitimate interests, there`s no bank secrecy, and that`s been true for years and years and years.
GERSH: Intelligence analysts believe terrorists are increasingly turning to gold, diamonds or cash to avoid detection. But the Treasury says the Swift data is still a powerful tool in catching terrorist funds transmitted through banks, though its future effectiveness is now in doubt. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.
