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Top falsehoods about NY Times Bush bank-tracking program
Media Matters
June 29, 2006

Summary: In response to the reports describing a Treasury Department program designed to monitor international financial transactions for terrorist activity, President Bush and other White House officials lashed out at the media -- and The New York Times in particular -- for purportedly undermining the government's antiterrorism efforts. But as with the disclosure of the Bush administration's warrantless domestic surveillance and domestic call-tracking programs, the administration and its supporters in the media have relied on numerous false and misleading claims to support their arguments.

On June 23, The New York Times and several other newspapers detailed a Treasury Department program designed to monitor international financial transactions for terrorist activity. According to the Times article, shortly after the September 11, 2001, terrorist attacks, the Bush administration tapped into a vast database of international financial transactions maintained by a banking consortium known as the Society for Worldwide Interbank Financial Telecommunication (SWIFT) in order to "trac[e] transactions of people suspected of having ties to Al Qaeda."

In response to the reports describing the program, President Bush and other White House officials lashed out at the media -- and the Times in particular -- for purportedly undermining the government's antiterrorism efforts. Numerous conservative media figures joined the administration in lambasting the Times, some even accusing the paper of treason and suggesting that the editors and reporters responsible for the Times article should be prosecuted under the Espionage Act. But as with the disclosure of both the Bush administration's warrantless domestic surveillance program and domestic call-tracking program, the administration and its supporters in the media have relied on numerous false and misleading claims to support their arguments.

Falsehood: Times article tipped off terrorists to U.S. bank-tracking efforts

In the wake of the June 23 Times article, Bush administration officials and numerous conservative media figures claimed that the newspaper had informed terrorists that their international transactions were being monitored. Vice President Dick Cheney said that the story "will enable the terrorists to look for ways to defeat our efforts." Treasury Secretary John W. Snow wrote that the article had "alerted terrorists to the methods and sources used to track their money trails." Meanwhile, right-wing pundit Michelle Malkin claimed that the Times had "tipped off terrorists to America's efforts to track their financial activities." Boston Globe columnist Jeff Jacoby alleged that the reports on the program "sabotaged" and "deliberately compromised a crucial counterterrorism tool." And the editors of National Review warned, "The terrorists will now adapt. They will find new ways of transferring funds, and precious lines of intelligence will be lost."

But long before June 23, Bush and other administration officials acknowledged that terrorists were increasingly using other methods of transferring money to evade detection.

As Media Matters noted, in testimony before Congress in 2004, Treasury Department undersecretary for terrorism and financial intelligence Stuart A. Levey said, "As the formal and informal financial sectors become increasingly inhospitable to financiers of terrorism, we have witnessed an increasing reliance by Al Qaida and terrorist groups on cash couriers. The movement of money via cash couriers is now one of the principal methods that terrorists use to move funds." In 2002 and 2003, the Congressional Research Service documented terrorists' increased use of alternative money flows, including "informal value transfer [hawala] systems that leave virtually no paper trail." Further, various news outlets and independent organizations have noted terrorist organizations' hesitance to use the international banking system in recent years.

That terrorist organizations would be aware of international efforts to track their finances is not surprising, as Bush administration officials have publicly touted the government's capability to do so for years. For instance, shortly after 9-11, Bush heralded the establishment of a "foreign terrorist asset tracking center at the Department of the Treasury to identify and investigate the financial infrastructure of the international terrorist networks." On November 7, 2001, then-Treasury Secretary Paul O'Neill announced that the United States, along with an "international coalition," had begun "to block assets, to seize books, records and evidence, and to follow audit trails to track terrorist cells poised to do violence to our common interests." In a September 10, 2004, statement, the Treasury Department disclosed "some of the many weapons used against terrorist networks," which included "following money trails to previously unknown terrorist cells." An April 2006 Treasury Department report similarly noted that the department "follows the terrorists' money trails aggressively, exploits them for intelligence, and severs links where we can."

Even SWIFT's cooperation in these efforts was a matter of public knowledge. Indeed, a United Nations working group learned years ago of the Treasury Department's use of SWIFT and noted the tactic in a December 2002 report. The consortium's own website notes its "history of cooperating in good faith with authorities such as central banks, treasury departments, law enforcement agencies and appropriate international organizations, such as the Financial Action Task Force (FATF), in their efforts to combat abuse of the financial system for illegal activities." The Bush administration has repeatedly touted its role as one of the 29 nations working with the FATF "to deny terrorist access to the world financial system."

Falsehood: Nobody has questioned the legality of the Treasury Dept. program

Conservative media figures such as Fox News host Bill O'Reilly and right-wing pundit Ann Coulter have claimed that "no one thinks" the bank-tracking program "violates any laws." But as Media Matters noted, various legal experts and politicians have publicly questioned the legality of the newly disclosed program.

For instance, the original Times article quoted L. Richard Fischer, identified as a leading expert on banking privacy, expressing concern that the program "appears to do an end run around bank-privacy laws that generally require the government to show that the records of a particular person or group are relevant to an investigation." The article went on to quote Fischer saying, "There has to be some due process." The Times also disclosed that "Treasury and Justice Department lawyers" debated legal issues surrounding the program, and that SWIFT executives were "[w]orried about potential legal liability," even threatening, at one point, to shut down the program.

Further, a June 24 Times story reported that Sen. Arlen Specter (R-PA) "said he was concerned about the legal authority for the operation." The article quoted Specter asking: ''Why does it take a newspaper investigation to get them [the Bush administration] to comply with the law?''

Falsehood: Times acknowledged the legality of bank-tracking program

Defenders of the administration have repeatedly claimed that the Times itself acknowledged that the Treasury Department program is legal. For instance, Rep. Peter King (R-NY) said on the June 27 edition of MSNBC's Hardball that the Times "never suggested this was illegal," while O'Reilly alleged that the June 23 article "went out of its way to say ... there was no illegality here." In his June 29 Globe column, Jacoby wrote that the Times "made clear" that the Bush administration program "was legal."

In fact, the Times has not weighed in on the legality of the program. Times executive editor Bill Keller stated in a June 25 letter sent to readers that "[i]t's not [the Times'] job to pass judgment on whether this program is legal." He also stated that "some experts familiar with the program have doubts about its legality, which has never been tested in the courts." Further, in a June 28 weblog post describing an interview with Keller, Washington Post media critic Howard Kurtz reported Keller's statement that "there were officials who talked to us who were uncomfortable with the legality of this program." As noted above, the Times reported these legal concerns in the original article.

Falsehood: Many Democrats urged the Times not to run article

Numerous conservative media figures have baselessly asserted that "a lot" of Democrats -- including Rep. John P. Murtha (D-PA) -- had asked the Times not to publish the June 23 article. In an interview with former House Speaker Newt Gingrich (R-GA) on the June 26 edition of The Big Story with John Gibson, guest-host David Asman asked, "[T]here were a lot of Democrats that called the editors of the Times asking them not to print this story, right?" Gingrich answered, "Yes." Similarly, on the June 27 edition of Fox & Friends, co-host Steve Doocy asserted that "John Murtha called the Times and said, 'Don't do it.' "

In fact, statements by Keller indicate that, at most, two Democrats advocated against publishing the article -- and possibly only one. Keller's reported statements on the question of whether two Democrats urged the Times not to publish appear not to be entirely consistent. On the June 26 edition of CNN's The Situation Room, Keller named only three people outside the administration who he said contacted the Times regarding the story -- Murtha, former 9-11 Commission vice chairman Lee Hamilton, and 9-11 Commission chairman Thomas H. Kean (a Republican). He did not say whether the two Democrats he named -- Murtha and Hamilton -- advocated against publishing the article, but did note that of the three individuals, "not all of them urged us not to publish." That same day, a letter from Snow to Keller confirmed that Hamilton had, in Snow's words, "urg[ed] the [Times] not to publish the story." This set of statements leaves open the possibility that Murtha might not have urged the Times to refrain from publishing. However, in a June 28 article, Kurtz wrote that "[Keller] said ... that three former officials also made the case to Times editors: Tom Kean and Lee Hamilton, chairmen of the 9/11 commission, and Democratic Rep. John Murtha of Pennsylvania -- an outspoken critic of the war in Iraq," though Murtha is not a "former official."

Falsehood: Times' justification for bank-tracking story opens the door to disclosure of any classified information

Appearing on the June 27 edition of Fox News' Special Report, attorney David B. Rivkin Jr. claimed that the Times' justification for publishing the June 23 article -- that the story is a matter of "public interest" -- would allow the media to print details of a hypothetical upcoming attack on Osama bin Laden. "Under this standard, nothing is safe," Rivkin said. "I can see a headline which says, 'Tomorrow, United States Closing on bin Laden.' You know, he is two hours away, in a cave."

In fact, Supreme Court precedent suggests that, in contrast with the information published by the Times, the publication of intelligence regarding troop movements or impending military operations would likely be punishable by law and even enjoined. As Media Matters noted, in the 1931 case Near v. Minnesota, the Supreme Court stated that the government could prevent newspapers and magazines from publishing select matters, including upcoming troop movements in a time of war: "No one would question but that a government might prevent actual obstruction to its recruiting service or the publication of the sailing dates of transports or the number and location of troops." Decades later, in his concurrence in the 1971 case New York Times v. United States, Justice William Brennan cited this passage from Near to describe the "single, extremely narrow class of cases in which the First Amendment's ban on prior judicial restraint may be overridden." Justice Potter Stewart, in another concurrence, argued that publication should be prevented only if "disclosure of any of them [the documents at issue] will surely result in direct, immediate, and irreparable damage to our Nation or its people" -- a standard that the administration evidently thought the bank-tracking story did not meet, as there is no indication that the administration asked a court to enjoin publication.

Original Text