Another US spy program exposed

Invoking the specter of Sept. 11 yet again, the Bush administration is vigorously defending a program–top secret until last week–that has allowed CIA and Treasury Dept. officials to examine hundreds of thousands of private banking records from around the world via the Society for Worldwide Interbank Financial Telecommunications, or SWIFT, network in search of terrorist ties. The program, which began shortly after Sept. 11, 2001, was revealed on June 22 on the websites of the New York Times, the Washington Post and the Wall Street Journal. Civil liberties groups see the program as another example of the Bush administration's willingness to operate outside the law, following just months after the controversy generated by the revelation of unwarranted NSA wiretaps. Key Congressional Democrats, on the other hand, professed ignorance. Although the White House has often spoken of the importance of disrupting terrorist financial networks, it had not previously revealed its methods. But John Snow, the treasury secretary, said last week the administration had not intruded unduly on the privacy of US citizens. "It's entirely consistent with democratic values, with our best legal traditions," Snow said. In a major departure from traditional methods of obtaining financial records, the Treasury Department uses a little-known power–administrative subpoenas–to collect data from the SWIFT network, which has operations in the US, including a main computer hub in Manassas, VA. The Brussels-based SWIFT is owned and controlled by nearly 8,000 commercial banks in more than 20 countries that use its services, including Bank of America, JP Morgan Chase Bank and Citibank. SWIFT provides electronic instructions for money transfers among financial institutions–virtually every bank, brokerage house and stock exchange. The SWIFT network carries up to 12.7 million messages a day containing instructions on many of the international transfers of money between banks. The messages typically include the names and account numbers of bank customers–from US citizens to major corporations–who are sending or receiving funds. The program was initially a closely guarded secret, but it has recently become known to a wider circle of government officials, former officials, banking executives and outside experts. Though headquartered in Brussels, much of SWIFT's operations are based in the United States, where knowledge of the government's secret access to its data was not widespread. Of officials at three large US banks who agreed to speak about the program, only one said his institution had knowledge of it before last week. Before Sept. 11, a former senior SWIFT executive said, providing access to its sensitive data would have been anathema to the consortium. But the attacks on the World Trade Center and the Pentagon led to a new mind-set in many industries, including telecommunications. SWIFT said the Treasury Department's Office of Foreign Assets Control sent the first subpoena shortly after Sept. 11, seeking "limited sets of data" to learn about how al-Qaida financed the attacks. Unlike telephone lines and email communications, the SWIFT network cannot be easily tapped. It uses secure log-ins and state-of-the-art encryption technology to prevent intercepted messages from being deciphered. "It is arguably the most secure network on the planet," said the former SWIFT executive who spoke on condition of anonymity. "This thing is locked down like Fort Knox." SWIFT said it was responding to compulsory subpoenas and negotiated with US officials to narrow them and to establish protections for the privacy of its customers. SWIFT also said it has never given US authorities direct access to its network. "Our fundamental principle has been to preserve the confidentiality of our users' data while complying with the lawful obligations in countries where we operate," SWIFT said in its statement. Far from giving ground, the Bush administration mounted a muscular defense of the program, dispatching its principal Treasury Department supervisor to explain how it works. The tactic was in sharp contrast to the administration's refusal to provide details about other secret programs that had been revealed earlier by news organizations, including the National Security Agency's warrantless wiretaps of overseas calls made by US citizens and residents. At the White House, press secretary Tony Snow acknowledged that the program relies on an expansive interpretation of Treasury's powers that is unusual. "Well, so was Sept. 11," he said. According to Vice President Dick Cheney, the program has been "absolutely essential" to protecting the country from further attacks. Outgoing Treasury Secretary John W. Snow said that the program, in effect since shortly after the Sept. 11, 2001, attacks, is the thing "I'm proudest of" in his tenure and insisted that strong safeguards within the program protect the privacy of individual US citizens. "It's really government at its best," Snow said at a news conference. "It's responsible government. It's effective government." The program falls well within the president's executive authority, Tony Snow asserted, and President Bush did not need to seek congressional authorization, although Snow said legislative oversight committees "know all about it." There is some disagreement, however, over who had been briefed on the program and when. Although the chairmen and senior Democrats on the two intelligence committees apparently were also briefed when the program began, there have been changes in the intelligence panels' leadership since 2001. The full committees–and the current chairmen and senior Democrats in some cases–learned of the program in May, when CIA and Treasury Department officials offered new briefings after learning that the New York Times was preparing an article on it, a Treasury official said. The White House referred reporters to Sen. Christopher S. Bond (R-MO), who said he had been informed about the secret effort four years ago, when he was named chairman of the Senate Appropriations subcommittee overseeing the Treasury Department. "I think it is a tremendous tool," Bond said. Some key Democrats on the several committees that oversee the Treasury Department appear to have been left in the dark. "No one ever called us, no one ever asked us. Nothing," said a spokesman for Rep. Carolyn B. Maloney (D-NY), the senior Democrat on the House Financial Services subcommittee in charge of international monetary policy and technology. "It would be very disturbing to me to find out that this program represents yet another unilateral action and further abuse of executive authority without proper safeguards and oversight," said Rep. Barney Frank (D-MA), the senior Democrat on the Financial Services Committee. The scope of the program is wide. "We've done a large number of searches since the program began," Treasury Undersecretary for Terrorism and Financial Intelligence Stuart Levey said. "I don't know the exact number but it's... at least tens of thousands, maybe hundreds of thousands of searches." Because SWIFT largely deals with financial data transfers across international borders, Levey said that US transactions would be subject to surveillance only if they were to or from other countries. Although the searches focus on suspected terrorist activity overseas, US officials acknowledged that they do delve into the financial activities of US citizens, noting that privacy laws don't protect individuals believed to be acting as a "foreign terrorist agent." The program was criticized by privacy advocates and civil liberties groups, who called for hearings on possible violations of domestic and international law. Anthony D. Romero, executive director of the American Civil Liberties Union, said: "The invasion of our personal financial information, without notification or judicial review, is contrary to the fundamental American value of privacy and must be stopped now. It seems the administration feels entitled to flip through all of our checkbooks." "We need a full accounting of what information has been demanded by the US government, how they have used it, with whom it was shared, and how they intend to repair this grave breech of trust," Romero said. "This program is a glaring example of how this government thinks nothing of widespread abuse of power." In the United States, law enforcement authorities can access bank records if they get permission through the legal process. The FBI also has various legal ways to get almost instantaneous access to financial records. And US banking laws require financial institutions to file Suspicious Activity Reports, but authorities believe al-Qaida and other terrorist groups know how to evade the activities that trigger such red flags.