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U.S. Government Monitors International Banking for Counterterrorism

June 23, 2006 at 6:20 PM EDT
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JEFFREY BROWN: U.S. Treasury Secretary John Snow told
reporters today that the program that secretly monitors international banking
records has saved American lives and has operated within the law.

JOHN SNOW, U.S. Treasury Secretary: It’s a program that is
entirely consistent with our democratic values, entirely consistent with our
best legal traditions. And, in fact, I’d go beyond that: I’d say this is a
program that builds on those traditions and strengthens them.

JEFFREY BROWN: The program began after the 9/11 attacks and
centers on a little-known Belgian-based banking cooperative, the Society for
Worldwide Interbank Financial Telecommunication, now known as SWIFT, which
routes about $6 trillion U.S. dollars a day between banks, brokerages, stock
exchanges and other institutions.

SWIFT functions as a kind of intermediary between financial
institutions. When someone instructs his or her bank, for example, to transfer
funds abroad to another party, that information is channeled through SWIFT and
includes the names of both sender and the recipient, bank account numbers, and
the amount of assets being transferred.

The request and information are passed onto the recipient’s
bank, which then transfers the requested money.

One Democrat on Capitol Hill today called the government’s
monitoring of these international transactions an invasion of privacy. Representative
Ed Markey of Massachusetts.

REP. ED MARKEY (D), Massachusetts: The administration cannot
claim that a temporary emergency lasts for five years to justify operating in
secret, because potentially that means that the temporary emergency could last
forever.

This administration is in violation of the United States’
Constitution. In the Bush administration, there are no checks and balances to
look at the American people’s checks and balances.

JEFFREY BROWN: The existence of the program was revealed by
several newspapers this morning. Treasury officials said they had asked some
newspapers not to publish the story.

Following the money trail

JEFFREY BROWN: I'm joined now by one of the key peopleoverseeing the program, Stuart Levey, undersecretary for terrorism andfinancial intelligence at the Department of Treasury.

And welcome to you.

STUART LEVEY, Undersecretary for Terrorism and FinancialIntelligence: Thank you for having me.

JEFFREY BROWN: What was the purpose of looking attransactions that flowed through SWIFT?

STUART LEVEY: The purpose of looking at these transactionsis very simple. We're trying to follow the money to identify the terrorists andto put pressure on terrorist organizations and to map out their networks.

The type of information that we were looking at and continueto look at through this SWIFT program is incredibly valuable. We're talkingabout international wire transfers for the most part, and that is the kind ofinformation that can draw concrete links between two individuals.

Let me just give you an example. If you're looking at aterrorist operative, say Stuart Levey, a terrorist operative, and you know thatsomeone has either sent him money, sent me money, or that I've sent money toanother person, that's a kind of link that we're looking for and that we canfollow up on.

And, in particular, if it's an international wire transfer,the kind of information that goes through SWIFT, the transactional data willgive you names, addresses, phone numbers, account numbers, just the kind ofconcrete information that our counterterrorism officials need to follow up.

JEFFREY BROWN: And did it, in fact, lead to some success?

STUART LEVEY: It's led to a number of successes. There are anumber of very successful counterterrorism investigations that have hadsuccessful conclusions where this program what was one of the key factors thatlead to the successful conclusion of those investigations.

And that's one of the reasons why, as you indicated in youropening, we did try to talk the relevant newspapers out of publishing thisstory.

We've been quite open, Jeff -- as you may know, we've beenquite open that we follow the money. My title is undersecretary for terrorismand financial intelligence. We're very open that we use financial intelligenceto fight terrorism. That's my job.

The only thing that this story revealed, in my view, that wehadn't already made public is exactly the source and method of how we do that. And,in my view, that's quite damaging to our overall effort.

Needles in a haystack

JEFFREY BROWN: All right, now you know this has alreadyraised a lot of questions, though, about appropriateness, about means, about even legality. There's ahuge pool of transactions that go through SWIFT.

First, explain to us, what's the exact criteria for decidingwhich ones you're going to look at.

STUART LEVEY: I'm glad you asked me that. What we do isthis: We issue an administrative subpoena to SWIFT periodically, approximately once a month. In responseto that...

JEFFREY BROWN: Excuse me. Administrative subpoena means itcomes from the administration, not through the courts, is what I'm getting at?

STUART LEVEY: It comes from the Treasury Department, but anyrecipient of an administrative subpoena, including this one, can challenge it in court if they wishto, so it compels the company to produce information.

In response to that subpoena, SWIFT has provided us a set ofdata which does have a lot of transactions in it, but we cannot access that data unless and until ouranalyst types in a specific query -- this is not general browsing around -- a specific query aimed at aspecific target that is tied to terrorism and has to articulate exactly what that tie to terrorism is before anysearch can be done.

JEFFREY BROWN: But who is watching that? I mean, who ismaking that decision that the search goes forward?

STUART LEVEY: I'm glad you asked me that, too. The initialdecision, of course, is made by the analyst himself or herself who takes the intelligence informationabout an ongoing terrorism investigation and makes a decision, in consultation with his supervisors, that this isa target that we should do financial research on.

But, as I said, we type -- that person has to enter thatquery and the basis for it into our computer.

And in real time, SWIFT, the company itself, is able tomonitor the searches and determine if there are any questions about whether or not the connection to terrorismis strong enough. If they have any questions about it, they can stop the search in real time.

But in addition to that, on top of that, we've had anoutside auditor who's been engaged for just this purpose to oversee how the government has been using thisdata, and that auditor has issued periodic reports.

They have access to all of these queries.

And they have determined, in report after report, that infact the government is using the data only to conduct counterterrorism searches. And we've had a verystrong record on that.

So we put appropriate safeguards in place. Our legalauthority is very powerful. It's really not -- there aren't significant questions. There are no realquestions about our legal authority.

And we're using it only for counterterrorism purposes. We'refollowing the money; we're finding the terrorists. And it's having real value for the Americanpeople. I think it would be irresponsible if we weren't doing this because we have the legal authority to do it.

Checking and balancing power

JEFFREY BROWN: Well, but there have been questions about the legal authority. And there were certainly reports in the papers today and people we've talked to that referred to it as a legal gray area. What exactly is the legal authority that allows you to do it? There are protections in place, after all, for privacy of financial transactions.

STUART LEVEY: Well, actually, the Supreme Court issued a decision called United States v. Miller which held that there isn't a privacy interest in these kinds of financial transactions.

But our authority to issue this subpoena and to conduct this kind of investigation is a statutory authority. It's long-standing. It's called IEEPA. It was passed by Congress in 1977. And it's specifically designed to allow the executive branch to do just this kind of investigation and to issue just this kind of subpoena.

JEFFREY BROWN: You saw what Congressman Markey said in our set-up, and others are now questioning this, something that starts as a short-term emergency and now, they say, looks like a limitless, unchecked power by the federal government.

STUART LEVEY: Well, I have seen those comments. I look forward to discussing with Congressman Markey, because I think, when he has all of the facts, I don't think that he'll have the same concerns.

In terms of these emergencies being long-standing, under IEEPA, the statute I referred to, there are a number of emergencies that were declared by President Clinton that are still ongoing, with respect to Sudan, the Middle East peace process, Burma. These are all ongoing emergencies under the same statute that I'm referring to that President Clinton declared that are still ongoing.

I think the American people understand that the threat we face from al-Qaida is still ongoing. President Bush did declare an emergency with respect to that in September of 2001, and I don't think that there's anyone who seriously questions that that's still an ongoing threat to us.

Security vs. public interest

JEFFREY BROWN: There also were some questions about howeffective a program like this still is; is it still the case that terrorists are sending money throughthese international financial institutions?

STUART LEVEY: You know, that's an excellent question,because, in fact, we are seeing terrorists turn more to cash couriers and other informal ways of transferringmoney. And that has been a trend that we've seen in recent years.

But I have to tell you: This program is still valuable. Peopleare still sending transactions through the international financial system, through the traditionalbanking system, and it's carried by SWIFT, and this program is still yielding value.

My concern is that, after the revelation of exactly whatdata we're looking at, that the terrorists that we're fighting who are, after all, very intelligent, veryadaptable, they will no longer do that and we will all be less safe as a result.

JEFFREY BROWN: And that brings me to the last question. Youraised that you had asked newspapers not to publish here. The editor of the New York Times, Bill Keller,was quoted as saying he saw it as a matter of public interest, that there was this vast repository ofinternational financial data being used, being looked at.

Do you say it is nota matter of public interest?

STUART LEVEY: Look, I don't want to question the motives or-- you know, this is a decision that Mr. Keller had to make. Our position was that the existence ofthis program, revealing our sources and methods, would make us all less safe and that, as long as it wasestablished -- and I think it was -- that we were on sound legal footing, we had appropriate safeguards in place,that the only thing that would be gained by putting the story out would be to reveal the source, reveal ourmethods, and make us less safe, we made a very strong pitch to them that this was a story that they should notrun.

Secretary Snow himself met with Mr. Keller. But, in the end,the New York Times decided to run the story, so, unfortunately, I'm doing press today.

JEFFREY BROWN: Here you are.

STUART LEVEY: So it's not press I wanted to do.

JEFFREY BROWN: All right Stuart Levey of the TreasuryDepartment, thank you very much.

STUART LEVEY: Thank you.