Friday, June 23, 2006

From telephone calls to bank records

The big revelation in today's papers are that the government has been monitoring a huge international database of financial transactions, looking for evidence of terrorist funding so they can trace it and shut it down.

The program is limited, government officials say, to tracing transactions of people suspected of having ties to Al Qaeda by reviewing records from the nerve center of the global banking industry, a Belgian cooperative that routes about $6 trillion daily between banks, brokerages, stock exchanges and other institutions. The records mostly involve wire transfers and other methods of moving money overseas and into and out of the United States. Most routine financial transactions confined to this country are not in the database.

Nobody should be suprised by this. We know the administration was monitoring phone calls, and we know they were trying to trace terrorist funding.

The one thing I find surprising is that a company based in Belgium agreed to share the data, despite rules to the contrary. But they have U.S. operations, which makes them subject to U.S. law. And in the aftermath of 9/11 they were interested in helping if they could.

So is this program another warrantless wiretap program? Yet another power grab by the administration in the name of fighting terror?

Yes and no. As constructed, I have fewer problems with this effort than I do with the eavesdropping program.

First, it's not warrantless:

Treasury officials did not seek individual court-approved warrants or subpoenas to examine specific transactions, instead relying on broad administrative subpoenas for millions of records from the cooperative, known as Swift.

Yes, it's a broad grab. But at least they're getting subpoenas (though it appears that's only because Swift demanded them). They're just National Security Letters, true, which require very little in the way of factual support. But it's better than just ignoring the whole warrant/subpoena process.

Second, it's mostly international records, and there are safeguards to keep the records of American citizens private.

Among the safeguards, government officials said, is an outside auditing firm that verifies that the data searches are based on intelligence leads about suspected terrorists. "We are not on a fishing expedition," Mr. Levey said. "We're not just turning on a vacuum cleaner and sucking in all the information that we can."

The auditing firm is a nice touch. But regardless, I have no problem with scanning foreign transactions. It's similar to what the NSA was created to do: monitor foreign communications. They don't need a warrant to do so, because foreigners have no protections under the Constitution.

So I don't have a big problem with the broad outline of the program. My concerns are smaller.

1. This program, created as a temporary, emergency measure right after 9/11, is becoming entrenched as a permanent tool. If this is going to be a long-term effort, then the program needs to ensure that it takes careful care of individual rights. As one official noted: while tight controls are in place, "the potential for abuse is enormous." It's the same problem we run into with other "emergency" powers claimed under the "war" metaphor; they are inherently incompatible with a decades-long fight such as we're facing with regard to terrorism. We need to find ways to access this data without invoking "emergency" powers that trample on rights.

2. If they're using an audit firm to ensure that every search is based on intelligence leads, that raises a big question: why do they need to use broad administrative subpoenas? If they know enough to request a record, they should be able to get a narrower warrant that would be far more protective of individual rights. The administration has shown little interest in such balancing measures. But as in the phone database case, it's not clear why -- other than a general desire to operate with as few restrictions as possible.

So while this program bears watching, and probably could use some reforms to make it compatible with long-term use, I don't find it as offensive as the more purely domestic operations that Bush has authorized.

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Anonymous Anonymous said...

Yes, it is not surprising to know this is going on.
But there are some things not clear.
The agency that turned in records has US operations .But were the records turned in just focused on US transactions or internatinoal transactions either originating or ending in the US?
My guess is no.
Another thing that really bothers me is this....
what power would a subpeona of US government have on international trasactions not connected in anyway to the US.?
True that the constitution doesnt protect any rights of foreign nationals.....then on what basis does a US subpeona stand?.......some international law or treaty that the US has ratified?
Recently there was federal judge ruling that non citizens can be discriminated in anyway the govt. wants..race, sex, health.....( this is different from legal residents who are non-citizens, they have equal protection under the constitution).....

I think the US goverment bullied their way into dealing with many international institutions and businesses. I am sure the democrats would have found a better way to do all this.

Foreign nationals dont have any rights......they can be discriminated against.......probably there are global dragets run by the NSA.......and yet at the same time America depends on the rest of the world for a lot...from resources to manpower ........I am not able to come to terms with this......

6/23/2006 12:40 PM  
Blogger Sean Aqui said...

GK: The company has operations here in the U.S., which makes it subject to U.S. law.

To be clear, when I say foreigners have no rights, I mean residents of foreign countries. Someone living in Germany, for instance, has no Constitutional right to be free of U.S. monitoring.

Foreign nationals here in the United States have limited rights. But as a matter of principle they should enjoy many of the same freedoms as citizens.

6/23/2006 1:29 PM  
Anonymous Anonymous said...

Thanks for the reply.....
It is still not clear to me....
For example ....Citibank has operations in the Middle East and in Europe. And if someone in the yemen transfer a million Euros to Germany, can that transaction still be legally subpeonaed.?

6/23/2006 2:10 PM  
Blogger Sean Aqui said...

It's my understanding that the actual transaction location doesn't matter. What matters is the location of the company handling the transaction.

In the case of Swift, it's not a bank; it's a message service that facilitates money transfers between its 7,800 members.

So if you wire money somewhere, and any part of that movement is handled by a Swift member, there will be a trace of it in the Swift database. And since Swift has operations in the U.S., that makes it vulnerable to U.S. scrutiny.

This means that a U.S. subpoena could end up providing a look at transactions that never went through the U.S. and used an entirely local bank -- if that bank is a member of Swift or contracts with a Swift member for money-transfer services.

6/23/2006 3:13 PM  

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