US Has Accessed Financial Transaction Data In Anti-Terror Operation

by Leroy Baker, Tax-News.com, New York

27 June 2006

The United States Treasury Department has attempted to assuage fears that it is snooping on innocent financial transactions as part of an ongoing - and until recently largely unknown - operation to track terrorist financing since 9/11.

News that the Treasury Department has been overseeing a Central Intelligence Agency program to monitor financial transaction data passed between banks over a system known as SWIFT (Society for Worldwide Interbank Financial Telecommunication), hit the headlines in America and beyond last week, following a report in the New York Times.

At a hastily-convened press conference in Washington D.C. on Friday, Stuart Levey, Under Secretary for the Office of Terrorism and Financial Intelligence, defended the program and condemned those who leaked its existence to the media.

"The terrorists we are pursuing are deadly serious and take every precaution to keep their plans and methods to themselves," Levey stated.

"We cannot expect to continue disrupting their activities if our most valuable programs are exposed on the front page of our newspapers," he added.

Levey claimed that the program, known unofficially as 'following the money,' is one of the most effective tools at the disposal of the US government to identify and find terrorists.

"If a terrorist operative that you're watching sends or receives money from another person, you know that there's a link between the two. Money trails don't lie," he explained.

"And, to wire money through a bank, a person needs to provide a name, address, and account number – exactly the kind of concrete leads that that can move an investigation forward and allow us to take action," he added.

SWIFT is a financial industry-owned co-operative supplying secure, standardised messaging services and interface software to 7,800 financial institutions in more than 200 countries. SWIFT's worldwide community includes banks, broker/dealers and investment managers, as well as their market infrastructures in payments, securities, treasury and trade. About $6 trillion in financial transactions is routed through Belgium-based SWIFT everyday, according to the NY Times.

As SWIFT is predominantly used for overseas transfers, Levey said that the data does not contain information on ordinary transactions that would be made by individuals in the United States, such as deposits, withdrawals, checks, or electronic bill payments.

However, one former counterterrorism official who spoke to the NY Times on condition of anonymity described the capability of the program as "awesome" and, depending on one's viewpoint, "troubling".

Levey revealed that the U.S. government has used the International Emergency Economic Powers Act, a statute passed in 1977, to subpoena records on terrorist-related transactions from SWIFT, although much of the government's authority for the program stems from the emergency powers granted to President Bush in the aftermath of 9/11. However, according to Levey, the SWIFT subpoena is "powerful but narrow," as it allows us to access only information that is related to terrorism investigations.

"We issue such subpoenas regularly, and our authority to do so has never been called into doubt," he stated.

The Treasury said that SWIFT was exempt from US laws restricting government access to private financial records because the cooperative was considered a messaging service, not a bank or financial institution.

Bill Keller, the executive editor of the NY Times, revealed in the report that the paper "listened closely" to the administration's plea not to publish the article, but decided to print because "the administration's extraordinary access to this vast repository of international financial data, however carefully targeted use of it may be, is a matter of public interest".

However, Levey responded by arguing that the revelations have set back the US government's ongoing campaign against terrorism, something he called "a grave loss".

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