Over the weekend, a bunch of media outlets let loose shock and awe in bulk leak documents, PanamaPapers, with project leaders ICIJ and Sueddeutsche Zeitung — as well as enthusiastic partner, Guardian — rolling out bring spreads on a massive trove of data from the shell company law firm Mossack Fonseca.
If all goes well, the leak showing what MF has been doing for the last four decades will lead us to have a better understanding of how money gets stripped from average people and then hidden in places where it will be safe from prying eyes.
Before I raise some questions about the project, I wanted to point to one of the best pieces of journalism I’ve seen from the project so far: this Miami Herald piece showing how its high end real estate boom has been facilitated by the money laundering facilitated by MF.
At the end of 2011, a company called Isaias 21 Property paid nearly $3 million — in cash — for an oceanfront Bal Harbour condo.
But it wasn’t clear who really owned the three-bedroom unit at the newly built St. Regis, an ultra-luxury high-rise that pampers residents with 24-hour room service and a private butler.
In public records, Isaias 21 listed its headquarters as a Miami Beach law office and its manager as Mateus 5 International Holding, an offshore company registered in the British Virgins Islands, where company owners don’t have to reveal their names.
Buried in the 11.5 million documents? A registry revealing Mateus 5’s true owner: Paulo Octávio Alves Pereira, a Brazilian developer and politician now under indictment for corruption in his home country.
A Miami Herald analysis of the never-before-seen records found 19 foreign nationals creating offshore companies and buying Miami real estate. Of them, eight have been linked to bribery, corruption, embezzlement, tax evasion or other misdeeds in their home countries.
That’s a drop in the ocean of Miami’s luxury market. But Mossack Fonseca is one of many firms that set up offshore companies. And experts say a lack of controls on cash real-estate deals has made Miami a magnet for questionable currency.
The story is deeply contextualized with localized reporting that goes beyond the leaked documents. And it can lead to policy changes — restrictions on cash real estate transactions — that can help to stem (or at least redirect) the flow of this corrupt money. You could tell similar stories from big cities around North America (this has been a particular focus in NYC and Vancouver). And with effort, cities could crack down on such cash transactions, with all the negative effects they bring to localities.
But much of the other reporting so far remains at the level of shock and awe. Biggest leak ever! Putin Putin Putin! And much of the reporting reflects not just editorial bias, but some apparent innumeracy (though no one has yet released the real numbers) to claim that people from evil countries are proportionally more corrupt than people from good countries like the UK.
Here’s how SZ describes how they got these documents.
Over a year ago, an anonymous source contacted the Süddeutsche Zeitung (SZ) and submitted encrypted internal documents from Mossack Fonseca, a Panamanian law firm that sells anonymous offshore companies around the world. These shell companies enable their owners to cover up their business dealings, no matter how shady.
In the months that followed, the number of documents continued to grow far beyond the original leak. Ultimately, SZ acquired about 2.6 terabytes of data, making the leak the biggest that journalists had ever worked with. The source wanted neither financial compensation nor anything else in return, apart from a few security measures.
Nowhere I’ve seen explains where this source got the documents.
For almost three years, we have openly debated what I consider a fair question: what was Edward Snowden’s motivation for stealing the NSA’s crown jewels and was any foreign country involved? People have also asked questions about how he accessed so much: Did he steal colleagues’ passwords? Did he join Booz Allen solely to be able to steal documents? I think the evidence supports an understanding that his motives were good and his current domicile an unfortunate outcome. And we know some details about how he managed to get what he did — but the key detail is that he was a Sysadmin in a location where insider detection systems were not yet implemented and credentials to have unaudited access to many of the documents he obtained. Those details are a key part of understanding some of the story behind his leaks (and how NSA and GCHQ are organized).
Somehow, journalists aren’t asking such questions when it comes to this leak, the Unaoil leak that broke last week, or the leak of files on British Virgin Isles have activity a few years back (which, like this project, ICIJ also had a central role in). I’m sympathetic to the argument that IDing who stole these documents would put her or him in terrible danger (depending on who it is). But I also think this level of description the Intercept gave — in the first paragraph of a story about stolen recordings of jailhouse phone calls that revealed improper retention of attorney client conversations — would be useful.
The materials — leaked via SecureDrop by an anonymous hacker who believes that Securus is violating the constitutional rights of inmates — comprise over 70 million records of phone calls, placed by prisoners to at least 37 states, in addition to links to downloadable recordings of the calls. [my emphasis]
The Intercept’s source, knowing of the problem, hacked recordings from an inadequately protected server.
As the Guardian’s own graphic makes clear, this leak dwarfs the leaks by Chelsea Manning and Hervé Falciani (the security engineer behind the HSBC leak). It probably dwarfs the Snowden leak (though oddly the Guardian, which had fingers in both, doesn’t include Snowden in its graphic). That ought to raise real questions about how someone could access so much more information than tech experts with key credentials working at the core of security in the targeted organizations could. And those questions are worth asking because if these files come from an external hacker — a definite possibility — than it ought to raise questions about how they were able to get so much undetected and even — as everyone felt appropriate to ask with Snowden — whether an intelligence agency was involved.
As with the BVI leak before it, thus far this leak has included no details on any Americans. Some have suggested that’s because the Panama trade deal already brought transparency on US persons’ activities through the haven of Panama, except these files go back four decades and. Americans not only used Panama as a haven before that, but the CIA used it as a key laundering vehicle for decades, as Manuel Noriega would be all too happy to explain if western countries would let him out of prison long enough to do so. Moreover, the files are in no way restricted to Panama (indeed, some of the stories already released describe the establishment of shell companies within the US).
Not only haven’t we heard about any Americans, but even for the close American friends identified so far — starting with Saudi Crown Prince and close CIA buddy Mohammed bin Nayef — the details provided to date are scanty, simply the name of the shell he was using.
Craig Murray has already been asking similar questions.
Russian wealth is only a tiny minority of the money hidden away with the aid of Mossack Fonseca. In fact, it soon becomes obvious that the selective reporting is going to stink.
The Suddeutsche Zeitung, which received the leak, gives a detailed explanation of the methodology the corporate media used to search the files. The main search they have done is for names associated with breaking UN sanctions regimes. The Guardian reports this too and helpfully lists those countries as Zimbabwe, North Korea, Russia and Syria. The filtering of this Mossack Fonseca information by the corporate media follows a direct western governmental agenda. There is no mention at all of use of Mossack Fonseca by massive western corporations or western billionaires – the main customers. And the Guardian is quick to reassure that “much of the leaked material will remain private.”
What do you expect? The leak is being managed by the grandly but laughably named “International Consortium of Investigative Journalists”, which is funded and organised entirely by the USA’s Center for Public Integrity. Their funders include
Rockefeller Family Fund
W K Kellogg Foundation
Open Society Foundation (Soros)
among many others. Do not expect a genuine expose of western capitalism. The dirty secrets of western corporations will remain unpublished.
Expect hits at Russia, Iran and Syria and some tiny “balancing” western country like Iceland. A superannuated UK peer or two will be sacrificed – someone already with dementia.
Now, in response to people like me and Murray and Moon of Alabama asking those questions, the SZ editor in charge of their side of the project promises dirt on Americans will be coming. Let’s hope so, because this is a worthwhile leak of data, and it would be unfortunate for Americans and Brits to be deprived of learning more about the corruption among their elite.
Back in December 2014, Ken Silverstein did a fairly thorough review of MF at Vice (though he worked at the Intercept at the time).
[A] yearlong investigation reveals that Mossack Fonseca—which theEconomist has described as a remarkably “tight-lipped” industry leader in offshore finance—has served as the registered agent for front companies tied to an array of notorious gangsters and thieves that, in addition to Makhlouf, includes associates of Muammar Gaddafi and Robert Mugabe, as well as an Israeli billionaire who has plundered one of Africa’s poorest countries, and a business oligarch named Lázaro Báez, who, according to US court records and reports by a federal prosecutor in Argentina, allegedly laundered tens of millions of dollars through a network of shell firms, some which Mossack Fonseca had helped register in Las Vegas.
Documents and interviews I’ve conducted also show that Mossack Fonseca is happy to help clients set up so-called shelf companies—which are the vintage wines of the money-laundering business, hated by law enforcement and beloved by crooks because they are “aged” for years before being sold, so that they appear to be established corporations with solid track records—including in Las Vegas. One international asset manager who talked to Mossack Fonseca about doing business with them told me that the firm offered to sell a 50-year-old shelf company for $100,000.
If shell companies are getaway cars for bank robbers, then Mossack Fonseca may be the world’s shadiest car dealership.
Silverstein clearly had some documents, though there’s no indication he had the trove that started getting leaked to SZ and ICIJ in early 2015, just weeks after Silverstein’s story.
On Twitter, Silverstein suggested his story never got published because this was the period when the Intercept wasn’t publishing (I had something similar happen to me while there).
But given the close continuity between Silverstein’s story and SZ receipt of the first documents, are they part of the same effort?
These aren’t papers showing the corruption that flows through Panama (for that matter, neither did the BVI leaks show all the corruption that flows through BVI, and there’s a significant BVI aspect to this leak). Rather, they show the corruption flowing through a Panamian-based but global firm, Mossack Fonseca. Reporting on this tells us MF is only the fourth largest of these laundering specialists.
So, aside from the fact that few people have heard of MF, why are we calling this the Panama Papers and not “Here’s what the fourth largest of these companies is involved with”?
All of which is to say as huge as this leak is — which is good! — it’s still just a tiny fraction of what’s out there.
None of this is meant to undermine the importance of this leak or the reporting the team of journalists covering it. Indeed, the story already threatens to take down the Prime Minister of Iceland whose conflict of interest the files revealed. We should have more of these leaks, covering all the havens and shell-creators.
Just remember, as you’re watching the coverage, that we’re getting selective coverage of one particular corner of that industry (ICIJ has said something about releasing files in several months). By all means let’s go after the crooks this story exposes, but let’s remember the crooks who, for whatever reason, aren’t included in this one.
Update: Fusion, which is part of the data sharing, admits there are only 211 Americans identified in the stash, though thus far this is just from recent years (that is, the years that might be affected by the trade agreement).
International Consortium of Investigative Journalists (ICIJ) has only been able to identify 211 people with U.S. addresses who own companies in the data (not all of whom we’ve been able to investigate yet). We don’t know if those 211 people are necessarily U.S. citizens.
All that said, the very good experts (including Jack Blum, who’s as good on these issues as anyone) don’t have very compelling explanations why there aren’t Americans in the stash.
Update: McClatchy describes some of the 200-some Americans whose passports show up in the files. All the ones it describes have been prosecuted (though several got light punishments).
Back in 2013, the President’s Review Group recommended that NSA’s defensive function — the Information Assurance Directorate — be removed from NSA. I’ve put the entirety of that recommendation below, but PRG recommended the change to:
Not only didn’t President Obama accept that recommendation, but he pre-empted it in several ways, before the PRG could publicly release their findings.
[O]n Thursday night, the Wall Street Journal and New York Times published leaked details from the recommendations from the review group on intelligence and communications technologies, a panelPresident Obama set up in August to review the NSA’s activities in response to theEdward Snowden leaks.
The stories described what they said were recommendations in the report as presented in draft form to White House advisors; the final report was due to the White House on Sunday. There were discrepancies in the reporting, which may have signaled the leaks were a public airing of disputes surrounding the review group (both articles noted the results were “still being finalized”). The biggest news item were reports about a recommendation that the director of the NSA(Dirnsa) and Cyber Command positions be split, with a civilian leading the former agency.
Before the final report was even delivered, the White House struck. On Friday, while insisting that the commission report was not yet final, national security council spokesperson Caitlin Hayden announced the White House had already decided the position would not be split. A dual-hatted general would continue to lead both.
By all appearances, the White House moved to pre-empt the results of its own review group to squelch any recommendation that the position be split.
Today, Ellen Nakashima reports that NSA will go further still, and completely merge its offensive and defensive missions.
In place of the Signals Intelligence and Information Assurance directorates, the organizations that historically have spied on foreign targets and defended classified networks against spying, the NSA is creating a Directorate of Operations that combines the operational elements of each.
Some lawmakers who have been briefed on the broad parameters consider restructuring a smart thing to do because an increasing amount of intelligence and threat activity is coursing through global computer networks.
“When it comes to cyber in particular, the line between collection capabilities and our own vulnerabilities — between the acquisition of signals intelligence and the assurance of our own information — is virtually nonexistent,” said Rep. Adam B. Schiff (Calif.), the ranking Democrat on the House Intelligence Committee. “What is a vulnerability to be patched at home is often a potential collection opportunity abroad and vice versa.”
But there have been rumblings of discontent within the NSA, which is based at Fort Meade, Md., as some fear a loss of influence or stature.
Some advocates for the comparatively small Information Assurance Directorate, which has about 3,000 people, fear that its ability to work with industry on cybersecurity issues will be undermined if it is viewed as part of the much larger “sigint” collection arm, which has about eight times as many personnel. The latter spies on overseas targets by hacking into computer networks, collecting satellite signals and capturing radio waves.
While Nakashima presents some conflicting views on whether IAD will be able to cooperate with industry, none of the comments she includes addresses the larger bureaucratic issue: that defense is already being shortchanged in favor of the glitzier offensive function.
But Edward Snowden did weigh in, in response to a comment I made on this onTwitter.
When defense is an afterthought, it’s not a National Security Agency. It’s a National Spying Agency.
It strikes me this NSA reorganization commits the country to a particular approach to cybersecurity that will have significant ramifications for some time. It probably shouldn’t be made with the exclusive review of the Intelligence Committees mostly in secret.
We recommend that the Information Assurance Directorate—a large component of the National Security Agency that is not engaged in activities related to foreign intelligence—should become a separate agency within the Department of Defense, reporting to the cyber policy element within the Office of the Secretary of Defense.
In keeping with the concept that NSA should be a foreign intelligence agency, the large and important Information Assurance Directorate (IAD) of NSA should be organizationally separate and have a different reporting structure. IAD’s primary mission is to ensure the security of the DOD’s communications systems. Over time, the importance has grown of its other missions and activities, such as providing support for the security of other US Government networks and making contributions to the overall field of cyber security, including for the vast bulk of US systems that are outside of the government. Those are not missions of a foreign intelligence agency. The historical mission of protecting the military’s communications is today a diminishing subset of overall cyber security efforts.
We are concerned that having IAD embedded in a foreign intelligence organization creates potential conflicts of interest. A chief goal of NSA is to access and decrypt SIGINT, an offensive capability. By contrast, IAD’s job is defense. When the offensive personnel find some way into a communications device, software system, or network, they may be reluctant to have a patch that blocks their own access. This conflict of interest has been a prominent feature of recent writings by technologists about surveillance issues.
A related concern about keeping IAD in NSA is that there can be an asymmetry within a bureaucracy between offense and defense—a successful offensive effort provides new intelligence that is visible to senior management, while the steady day-to-day efforts on defense offer fewer opportunities for dramatic success.
Another reason to separate IAD from NSA is to foster better relations with the private sector, academic experts, and other cyber security stakeholders. Precisely because so much of cyber security exists in the private sector, including for critical infrastructure, it is vital to maintain public trust. Our discussions with a range of experts have highlighted a current lack of trust that NSA is committed to the defensive mission. Creating a new organizational structure would help rebuild that trust going forward.
There are, of course, strong technical reasons for information-sharing between the offense and defense for cyber security. Individual experts learn by having experience both in penetrating systems and in seeking to block penetration. Such collaboration could and must occur even if IAD is organizationally separate.
In an ideal world, IAD could form the core of the cyber capability of DHS. DHS has been designated as the lead cabinet department for cyber security defense. Any effort to transfer IAD out of the Defense Department budget, however, would likely meet with opposition in Congress. Thus, we suggest that IAD should become a Defense Agency, with status similar to that of the Defense Information Systems Agency (DISA) or the Defense Threat Reduction Agency (DTRA). Under this approach, the new and separate Defense Information Assurance Agency (DIAA) would no longer report through intelligence channels, but would be subject to oversight by the cyber security policy arm of the Office of the Secretary of Defense.
Between this report, released today, on DOD Inspector General’s ongoing work and the Intelligence Community’s Inspector General Semiannual report, released in mid-January, the Intelligence Community is doing a whole bunch of audits and inspections of its own network security, some of them mandated by Congress. And there are at least hints that all is not well in the networks that enable the Intelligence Community to share profusely.
The most interesting description of a report from ICIG’s Semiannual review, for example, suggests that, given the IC’s recent move to share everything on an Amazon-run cloud, the bad security habits of some elements of the IC are exposing other elements within the IC.
AUD-2015-006: Transition to the Intelligence Community Cloud Audit
The DNI, along with Intelligence Community leadership, determined that establishing a common IT architecture across the IC could advance intelligence integration, information sharing, and enhance security while creating efficiencies. This led to the Intelligence Community Information Technology Enterprise, an IC-wide initiative coordinated through the Office of the Intelligence Community Chief Information Officer. IC ITE’s sharing capability is enabled by a cloudbased architecture known as the IC Cloud – a secure resource delivering IT and information services and capabilities to the entire community. The cloud will allow personnel to share data, systems, and applications across the IC. The IC elements’ effective transition to the IC ITE cloud environment is key to achieving the initiative’s overarching goals and as such, systems working together in a cloud environment creates potential security concerns.
In particular, information system security risks or vulnerabilities to one IC element operating within IC ITE may put all IC elements at risk. Information from a joint IG survey of 10 IC elements suggested that the elements may have the differing interpretations of policies and requirements, or are not fully aware of their responsibilities for transitioning to the IC Cloud. As a result of these preliminary observations, IC IG initiated an audit that will: 1. Assess how the IC elements are planning to transition to the IC ITE Cloud environment; 2. Determine IC elements’ progress in implementing cloud transition plans; and, 3. Compare how IC elements are applying the risk management framework to obtain authorizations to operate on the IC Cloud. We plan to issue a report by the end of the first quarter of FY 2017. [my emphasis]
The IC is banking quite a bit on being able to share safely within the cloud. I would imagine that fosters a culture of turf war and recriminations for any vulnerabilities. It certainly seems that this report arises out of problems — or at least the identification of potential problems — arising from the move to the cloud. Note that this report won’t be completed until the end of this calendar year.
Then there’s this report, which was mandated in a classified annex of the Intelligence Authorization passed in December and, from the looks of things, started immediately.
Audit of Controls Over Securing the National Security Agency Network and Infrastructure (Project No. D2016-DOOORC-0072.000)
We plan to begin the subject audit in January 2016. Our objective is to determine whether initiatives implemented by the National Security Agency are effective to improve security over its systems, data, and personnel activities. Specifically, we will determine whether National Security Agency processes and technical controls are effective to limit privileged access to National Security Agency systems and data and to monitor privileged user actions for unauthorized or inappropriate activity. The classified annex to accompany H.R. 2596, the Intelligence Authorization Act for Fiscal Year 2016, contained a Department of Defense Inspector General classified reporting requirement. This audit is the first in a series. We will consider suggestions from management on additional or revised objectives.
It seems to be an assessment — the first in a series — of whether limits on privileged access to NSA systems are working. This may well be a test of whether the changes implemented after the Snowden leak (such as requiring two parties to be present when performing functions in raw data, such as required on dragnet intake) have mitigated what were some obviously huge risks.
I’m mostly curious about the timing of this report. You would have thought the implementation of such controls would come automatically with some kind of audit, but they’re just now, 2.5 years later, getting around to that.
Here are some other reports from the ICIG report, the latter three of which indicate a real focus on information sharing.
AUD-2015-007: FY 2015 Consolidated Federal Information Security Modernization Act of 2014 Capstone Reports for Intelligence Community Elements’ Inspectors General
This project will focus on FY 2015 FISMA report submissions from the OIGs for the IC elements operating or exercising control of national security systems. We will summarize 11 IC elements’ information security program strengths and weaknesses; identify the cause of the weaknesses in these programs, if noted by the respective OIGs; and provide a brief summary of the recommendations made for IC information security programs. To perform this evaluation, we will apply the Department of Homeland Security FY 2015 IG FISMA metrics for ten information security program areas.
1. Continuous Monitoring Management 2. Security Configuration Management 3. Identity and Access Management 4. Incident Response and Reporting 5. Risk Management 6. Security Training 7. Plan of Action and Milestones 8. Remote Access Management 9. Contingency Planning 10. Contractor Systems We will issue our report by the end of the first quarter of FY 2016
INS-2015-004: Inspection: Office of the Intelligence Community Chief Information Officer
The IC CIO is accountable for overall formulation, development, and management of the Intelligence Community Information Technology Enterprise. The scope of our review was limited and informed by a concurrent IC IG Audit survey of IC ITE, as well as an ongoing evaluation of IC ITE progress by the ODNI Systems and Resources Analyses office. Additional details of this report are in the classified annex.
INS-2015-005: Joint Evaluation of Field Based Information Sharing Entities
Along with our OIG partners at the Departments of Justice and Homeland Security, we are evaluating federally supported entities engaged in field-based domestic counterterrorism, homeland security, and information sharing activities in conjunction with state, tribal, and local law enforcement agencies. This review is in response to a request from Senate committees on Intelligence, Judiciary, Homeland Security and Governmental Affairs. We will issue our report during FY 2016.
INS-2015-006: Inspection: ODNI Office of the Program Manager–Information Sharing Environment
We last inspected the ODNI PM-ISE office in 2013 and are conducting a follow-up review with a focus on resource management.
Jenna McLaughlin has a report on what I noted here — House Judiciary Committee Chair Bob Goodlatte has scheduled a classified hearing to talk about Section 702 of the FISA Amendments Act on February 2. In it, she includes this unbelievable quote from Jim Sensenbrenner.
“Closed briefings are necessary for members of Congress to ask questions about classified information,” said Judiciary Committee member Jim Sensenbrenner, R-Wisc., in a statement to The Intercept. “However, I would support a subsequent open hearing on Section 702 of the Foreign Intelligence Surveillance Act because transparency and public discussion are critical to the reform and reauthorization of Section 702.”
It’s unbelievable because, after Sensenbrenner made some horseshit claims of ignorance immediately after Edward Snowden revealed the phone dragnet that had been authorized by legislation Sensenbrenner had authored, people started asking why he hadn’t gone to the classified hearings, at which DOJ briefed members about the dragnet (and FBI later lied about the abuses carried out in executing that dragnet).
Sensenbrenner’s spokesperson explained back in 2013 that he didn’t go to those classified hearing because he didn’t want to be restrained by confidentiality.
Asked whether his boss had attended any of those sessions during that period, Sensenbrenner spokesperson Ben Miller said the congressman “does not want to be limited by the restraints of confidentiality. Therefore, he believes in an open dialogue by which legislative solutions can be constructed and passed into law before the public.” Miller said Sensenbrenner had “attended confidential briefings in the past,” but didn’t say how many, which ones, or whether any dealt directly with the “sensitive” application of section 215.
“While some members of Congress were briefed, particularly those on the intelligence committees, most, including myself, were not,” Sensenbrenner wrote in a column for The Guardian newspaper. Sensenbrenner did not disclose, as his spokesperson did for this story, that he chooses not to attend the briefings.
So back in 2013, when Sensenbrenner was disclaiming any responsibility for a dragnet, he didn’t to be restrained by what he gets told in a classified hearing.
But now, at a time when Congress might consider stopping FBI from doing its uncounted back door searches of people it has no evidence against, Sensenbrenner says “closed briefings are necessary.”
Given what 2013 Sensenbrenner said about the importance of conducting these discussions in the light of day, and given that Section 702 has always been debated in public, I would suggest Sensenbrenner’s support for closed hearings now suggests the fix is in.
One wonders what squeals of outrage Sensenbrenner will make in 2023 after new abuses of Section 702 get disclosed?
NSA propagandist John Schindler has used the San Bernardino attack as an opportunity to blame Edward Snowden for the spy world’s diminished effectiveness, again.
Perhaps the most interesting detail in his column is his claim that 80% of thwarted attacks come from an NSA SIGINT hit.
Something like eighty percent of disrupted terrorism cases in the United States begin with a SIGINT “hit” by NSA.
That’s mighty curious, given that defendants in these cases aren’t getting notice of such SIGINT hits, as required by law, as ACLU’s Patrick Toomey reminded just last week. Indeed, the claim is wholly inconsistent with the claims FBI made when it tried to claim the dragnet was effective after the Snowden leaks, and inconsistent with PCLOB’s findings that the FBI generally finds such intelligence on its own. Whatever. I’m sure the discrepancy is one Schindler will be able to explain to defense attorneys when they subpoena him to explain the claim.
Then there’s Schindler’s entirely illogical claim that the shut-down of the phone dragnet just days before the attack might have helped to prevent it.
The recent Congressionally-mandated halt on NSA holding phone call information, so-called metadata, has harmed counterterrorism, though to what extent remains unclear. FBI Director James Comey has stated, “We don’t know yet” whether the curtailing of NSA’s metadata program, which went into effect just days before the San Bernardino attack, would have made a difference. Anti-intelligence activists have predictably said it’s irrelevant, while some on the Right have made opposite claims. The latter have overstated their case but are closer to the truth.
As Mike Lee patiently got Jim Comey to admit last week, if the Section 215 phone dragnet (as opposed to the EO 12333 phone dragnet, which remains in place) was going to prevent this attack, it would have.
Schindler then made an error that obscures one of the many ways the new phone dragnet will be better suited to counterterrorism. Echoing a right wing complaint that the government doesn’t currently review social media accounts as part of the visa process, he claimed “Tashfeen Malik’s social media writings [supporting jihad] could have been easily found.” Yet at least according to ABC, it would not have been so easy. “Officials said that because Malik used a pseudonym in her online messages, it is not clear that her support for terror groups would have become known even if the U.S. conducted a full review of her online traffic.” [See update.] Indeed, authorities found the Facebook post where Malik claimed allegiance to ISIS by correlating her known email with her then unknown alias on Facebook. NSA’s new phone program, because it asks providers for “connections” as well as “contacts,” is far more likely to identify multiple identities that get linked by providers than the old program (though it is less likely to correlate burner identities via bulk analysis).
Really, though, whether or not the dragnet could have prevented San Bernardino which, as far as is evident, was carried out with no international coordination, is sort of a meaningless measure of NSA’s spying. To suggest you’re going to get useful SIGINT about a couple who, after all lived together and therefore didn’t need to use electronic communications devices to plot, is silliness. A number of recent terrorist attacks have been planned by family members, including one cell of the Paris attack and the Charlie Hebdo attack, and you’re far less likely to get SIGINT from people who live together.
Which brings me to the most amazing part of Schindler’s piece. He argues that Americans have developed a sense of security in recent years (he of course ignores right wing terrorism and other gun violence) because “the NSA-FBI combination had a near-perfect track record of cutting short major jihadist attacks on Americans at home since late 2001.” Here’s how he makes that claim.
Making matters worse, most Americans felt reasonably safe from the threat of domestic jihadism in recent years, despite repeated warnings about the rise of the Islamic State and terrible attacks like the recent mass-casualty atrocity in Paris. Although the November 2009 Fort Hood massacre, perpetrated by Army Major Nidal Hasan, killed thirteen, it happened within the confines of a military base and did not involve the general public.
Two months before that, authorities rolled up a major jihadist cell in the New York City area that was plotting complex attacks that would have rivalled the 2005 London 7/7 atrocity in scope and lethality. That plot was backed by Al-Qa’ida Central in Pakistan and might have changed the debate on terrorism in the United States, but it was happily halted before execution – “left of boom” as counterterrorism professionals put it.
Jumping from the 2009 attacks (and skipping the 2009 Undiebomb and 2010 Faisal Shahzad attempts) to the Paris attack allows him to suggest any failure to find recent plots derives from Snowden’s leaks, which first started in June 2013.
However, the effectiveness of the NSA-FBI counterterrorism team has begun to erode in the last couple years, thanks in no small part to the work of such journalists-cum-activists. Since June 2013, when the former NSA IT contactor [sic] Edward Snowden defected to Moscow, leaking the biggest trove of classified material in all intelligence history, American SIGINT has been subjected to unprecedented criticism and scrutiny.
There is, of course, one enormous thing missing from Schindler’s narrative of NSA perfection: the Boston Marathon attack, committed months before the first Snowden disclosures became public. Indeed, even though the NSA was bizarrely not included in a post-Marathon Inspector General review of how the brothers got missed, it turns out NSA did have intelligence on them (Tamerlan Tsarnaev was in international contact with known extremists and also downloaded AQAP’s Inspire magazine repeatedly). Only, that intelligence got missed, even with the multiple warnings from FSB about Tamerlan.
Perhaps Schindler thinks that Snowden retroactively caused the NSA to overlook the intelligence on Tamerlan Tsarnaev? Perhaps Schindler doesn’t consider an attack that killed 3 and injured 260 people a “major jihadist attack”?
It’s very confusing, because I thought the Boston attack was a major terrorist attack, but I guess right wing propagandists trying to score points out of tragedy can ignore such things if it will spoil their tale of perfection.
Update: LAT reports that Malik’s Facebook posts were also private, on top of being written under a pseudonym. Oh, and also in Urdu, a language the NSA has too few translators in. The NSA (but definitely not the State Department) does have the ability to 1) correlate IDs to identify pseudonyms, 2) require providers to turn over private messages — they could use PRISM and 3) translate Urdu to English. But this would be very resources intensive and as soon as State made it a visa requirement, anyone trying to could probably thwart the correlation process.
I noted the other day that at a pre-scheduled appearance Monday, Josh Rogin cued John Brennan to explain how the Paris attack happened without warning. In my opinion, the comment has been badly misreported as an indictment solely of Edward Snowden (though it is that) and encryption. I’ve put the entire exchange below but the key exchange was this:
And as I mentioned, there are a lot of technological capabilities that are available right now that make it exceptionally difficult, both technically as well as legally, for intelligence and security services to have the insight they need to uncover it. And I do think this is a time for particularly Europe, as well as here in the United States, for us to take a look and see whether or not there have been some inadvertent or intentional gaps that have been created in the ability of intelligence and security services to protect the people that they are asked to serve. And in the past several years because of a number of unauthorized disclosures and a lot of handwringing over the government’s role in the effort to try to uncover these terrorists, there have been some policy and legal and other actions that are taken that make our ability collectively internationally to find these terrorists much more challenging. And I do hope that this is going to be a wake-up call, particularly in areas of Europe where I think there has been a misrepresentation of what the intelligence security services are doing by some quarters that are designed to undercut those capabilities.
Brennan talks about technology that makes it difficult technically and legally to uncover plots. Encryption is a technical problem — one the NSA has proven its ability to overcome — that might be called a legal one if you ignore that NSA has the ability to overcome the lack of a legal requirement to provide back doors. But I agree this passage speaks to encryption, if not other issues.
In the next sentence, though, he talks about inadvertent or intentional gaps created “particularly in Europe.” He talks about plural unauthorized disclosures — as I noted, Josh Rogin’s own disclosure that the US had broken AQAP’s online conferencing technique may have been more directly damaging than most of Snowden’s leaks — and “handwringing.” Those have led to “policy and legal and other actions” that have made it harder to find terrorists. In the next sentence, Brennan again emphasizes that “particularly in areas of Europe,” there needs to be a “wake-up call” because “there has been a misrepresentation” of what the spooks are doing, which he suggests was deliberately “designed to undercut those capabilities.”
So the paragraph where he speaks of these problems, he twice emphasizes that Europe in particular needs to adjust its approach.
Last I checked, Europe didn’t pass USA Freedom Act (which would not, in any way, have restricted review of Parisian targeters). Some countries in Europe are more vigorously considering limits on encryption, but those would be just as ineffective as eliminating the code that’s already out there.
What Europe has done, however, is make it harder for our PRISM providers to share data back and forth between Europe (and with providers considering moving servers to Europe, it will raise new questions about the applicability of PRISM for that data). And Europe (not just Europe, but definitely including Europe) has created a market need for US tech companies to distance themselves from the government.
And in the case of Germany, politicians have been investigating how much its BND has done for NSA, and especially which impermissible German people and companies were targeted as part of the relationship. I noted that Brennan raised similar issues just days after the BND investigation turned scandalous in March, and recent revelations have raised new pressure on BND.
With that in mind, in particular, consider what one of the more responsible reports on Brennan’s speech, that of Shane Harris, focused on — terrorists’ use of Berlin headquartered social messaging app Telegram. If terrorists were using WhatsApp (which a lot of the fearmongering focused on), the metadata, at least, would be available via Facebook. But since Telegram is not a US company, it cannot be obliged under Section 702 of FISA, and that surely creates just the kind of gap Brennan was talking about.
Since Brennan’s speech, Telegram has started deleting the special channels set up by ISIS to communicate.
I’m sure Brennan is complaining about encryption and if he can get Congress to force domestic back doors, I’m sure he will (though ISIS reportedly shies away from Apple products, so forcing Apple to give up its encrypted iMessage won’t help track down ISIS). But his speech seemed focused much more intently on ways in which, in the aftermath of the Snowden leaks, Europeans have opportunistically localized data and, in the process, made that data far less accessible to the NSA. Brennan, as I made clear in March, definitely would prefer the Europeans rely on Americans for their SIGINT (and in the process agree to some inappropriate spying in their home country), and the gap created by terrorists’ reliance on Telegram is one way to exert pressure on that point.
Josh Rogin is among many journalists who covered John Brennan’s complaints about how “a number of unauthorized disclosures”and hand-wringing about our surveillance capabilities this morning (which was a response to Rogin asking “what went wrong” in Paris in questions).
But Brennan also said that there had been a significant increase in the operational security of terrorists and terrorist networks, who have used new commercially available encryption technologies and also studied leaked intelligence documents to evade detection.
“They have gone to school on what they need to do in order to keep their activities concealed from the authorities,” he said. “I do think this is a time for particularly Europe as well as the U.S. for us to take a look and see whether or not there have been some inadvertent or intentional gaps that have been created in the ability of intelligence services to protect the people that they are asked to serve.”
The FBI has said that Internet “dark spaces” hinder monitoring of terrorism suspects. That fuels the debate over whether the government should have access to commercial applications that facilitate secure communications.
Brennan pointed to “a number of unauthorized disclosures” over the past several years that have made tracking suspected terrorists even more difficult. He said there has been “hand wringing” over the government’s role in tracking suspects, leading to policies and legal action that make finding terrorists more challenging, an indirect reference to the domestic surveillance programs that were restricted after leaks by Edward Snowden revealed their existence.
I find it interesting that Rogin, of all people, is so certain that this is an “indirect reference to the domestic surveillance programs that were restricted after leaks by Edward Snowden revealed their existence.” It’s a non-sensical claim on its face, because no surveillance program has yet been restricted in the US, though FBI has been prevented from using NSLs and Pen Registers to bulk collection communications. The phone dragnet, however, is still going strong for another 2 weeks.
That reference — as I hope to show by end of day — probably refers to tech companies efforts to stop the NSA and GCHQ from hacking them anymore, as well as European governments and the EU trying to distance themselves from the US dragnet. That’s probably true, especially, given that Brennan emphasized international cooperation in his response.
I’m also confused by Rogin’s claim Jim Comey said Tor was thwarting FBI, given that the FBI Director said it wasn’t in September.
Even more curious is that Rogin is certain this is about Snowden and only Snowden. After all, while Snowden’s leaks would give terrorists a general sense of what might not be safe (though not one they tracked very closely, given the Belgian Minister of Home Affair’s claim that they’re using Playstation 4 to communicate, given that one of Snowden’s leaks said NSA and CIA were going after targets use of gaming consoles to communicate at least as early as 2008).
But a different leak would have alerted terrorists that their specific communications techniques had been compromised. The leak behind this story (which was a follow-up on leaks to the NYT, McClatchy, and WaPo).
It wasn’t just any terrorist message that triggered U.S. terror alerts and embassy closures—but a conference call of more than 20 far-flung al Qaeda operatives, Eli Lake and Josh Rogin report.
The crucial intercept that prompted the U.S. government to close embassies in 22 countries was a conference call between al Qaeda’s senior leaders and representatives of several of the group’s affiliates throughout the region.
The intercept provided the U.S. intelligence community with a rare glimpse into how al Qaeda’s leader, Ayman al-Zawahiri, manages a global organization that includes affiliates in Africa, the Middle East, and southwest and southeast Asia.
Several news outlets reported Monday on an intercepted communication last week between Zawahiri and Nasser al-Wuhayshi, the leader of al Qaeda’s affiliate based in Yemen. But The Daily Beast has learned that the discussion between the two al Qaeda leaders happened in a conference call that included the leaders or representatives of the top leadership of al Qaeda and its affiliates calling in from different locations, according to three U.S. officials familiar with the intelligence. All told, said one U.S. intelligence official, more than 20 al Qaeda operatives were on the call.
Al Qaeda leaders had assumed the conference calls, which give Zawahiri the ability to manage his organization from a remote location, were secure. But leaks about the original intercepts have likely exposed the operation that allowed the U.S. intelligence community to listen in on the al Qaeda board meetings.
That story — by Josh Rogin himself! (though again, this was a follow-up on earlier leaks) — gave Al Qaeda, though maybe not ISIS, specific notice that one of their most sensitive communication techniques was compromised.
It’s really easy for journalists who want to parrot John Brennan and don’t know what the current status of surveillance is to blame Snowden. But those who were involved in the leak exposing the Legion of Doom conference call (which, to be sure, originated in Yemen, as many leaks that blow US counterterrorism efforts there do) might want to think twice before they blame other journalism.
President Obama, as you’ve likely heard, just announced an extension of the Afghan mission. He insists combat operations in Afghanistan are over. He insists the role of the “train, advise, assist” advisors on the ground won’t change. Our troops just need to stick around in Afghanistan until the training begins to take hold.
I’m most interested in the timing of this announcement. It comes 12 days after Americans — working at the behest of the Afghans we’re “train, advise, assisting” — destroyed a Médecins Sans Frontières hospital in Kunduz. Afghan commander General John Campbell, on a pre-planned trip to testify about how we need to extend our deployment, also answered questions about the attack and promised an investigation; he even suggested a preliminary investigation should be done within a month (so within the next 20 days).
Lucky for Obama, American reporters have short memories, otherwise some might ask him about the combat role these TAA advisors played two weeks ago today, returning fire against Taliban forces, just before the US destroyed a hospital. Because then we might be focusing on how Kunduz underscored that Americans will still be drawn into fighting.
But it’s the MSF bombing that would really undercut Obama’s decision to have us stay. Probably, the DOD investigation is going to show that the Afghans made unjustified claims about the Taliban operating from the hospital, most charitably because of confusion, but possibly because they didn’t like that the hospital treated Taliban members (and likely was treating some from fighting earlier in the week). It will also show Special Operations process on vetting totally violated protocol, which will raise more questions about precisely what role SOF is playing on the ground (and how our counterterrorism operations, such as this was, threaten to drag us back in).
So Obama rolled out his decision in that sweet spot, where most of the big reporting on the MSF attack has passed, but before the report will renew attention on precisely what we’re doing in Afghanistan.
One other point about Obama’s decision. In his announcement today — and in Campbell’s testimony last week — both men raved about what a great partner Ashraf Ghani is (both also made overly optimistic claims about how well power sharing is working). That should make it clear — if this analysis wasn’t already enough — that the shut-down of NSA’s full take on Afghanistan cell phone content that happened after WaPo and Intercept described the MYSTIC/SOMALGET programs has since been reversed. It’s clear Ghani has agreed to do what we have asked in order to get us to stay, and we surely asked for turn the full take back on, for troop protection if not to better spy on the Taliban. Which, of course, would indicate Clapper was lying again.
Finally, MSF has not backed off its demand for an independent investigation. It just launched a Change.org petition calling on President Obama to consent to an independent investigation.
Just a few days after our Egyptian allies sentenced 3 Al Jazeera journalists to 3 years in prison, Turkey joined the club, charging 2 UK Vice employees and their Turkish fixer with terrorism. Today, Al Jazeera explained why the Vice journalists got charged: because the fixer uses an encryption technique that members of ISIS also use.
Three staff members from Vice News were charged with “engaging in terrorist activity” because one of the men was using an encryption system on his personal computer which is often used by the Islamic State of Iraq and the Levant (ISIL), a senior press official in the Turkish government has told Al Jazeera.
Two UK journalists, Jake Hanrahan and Philip Pendlebury, along with their Turkey-based Iraqi fixer and a driver, were arrested on Thursday in Diyarbakir while filming clashes between security forces and youth members of the outlawed and armed Kurdistan Workers’ Party (PKK).
On Monday, the three men were charged by a Turkish judge in Diyarbakir with “engaging in terrorist activity” on behalf of ISIL, the driver was released without charge.
The Turkish official, who spoke on condition of anonymity, told Al Jazeera: “The main issue seems to be that the fixer uses a complex encryption system on his personal computer that a lot of ISIL militants also utilise for strategic communications.”
Note, the Vice journalists were reporting on PKK, not ISIS, but it wouldn’t be the first time Turkey used ISIS as cover for their war against PKK.
A lot of people are treating this as a crazy expression of rising Turkish repression, that it conflates use of encryption — even a certain kind of encryption! — with membership in ISIS.
But they’re not the only one who does so. As the slide above — and some other documents released by Snowden — makes clear, NSA makes the same conflation. How do you find terrorists without other information, this slide asks? Simple! You find someone using encryption.
While the US might not arrest people based on such evidence (though it did hold Al Jazeera journalist Sami al-Hajj for years without charge), they certainly make the same baseless connection.
Two weeks after floating a story to the NYT the Obama asked for some creative ways to retaliate against China for the OPM hack, the NYT reported (in both English and a prominently linked Chinese translation) that “in recent weeks” the US told agents trying to chase down Chinese nationals accused of corruption to get out.
The Obama administration has delivered a warning to Beijing about the presence of Chinese government agents operating secretly in the United States to pressure prominent expatriates — some wanted in China on charges of corruption — to return home immediately, according to American officials.
The American officials said that Chinese law enforcement agents covertly in this country are part of Beijing’s global campaign to hunt down and repatriate Chinese fugitives and, in some cases, recover allegedly ill-gotten gains.
The Chinese government has officially named the effort Operation Fox Hunt.
The American warning, which was delivered to Chinese officials in recent weeks and demanded a halt to the activities, reflects escalating anger in Washington about intimidation tactics used by the agents. And it comes at a time of growing tension between Washington and Beijing on a number of issues: from the computer theft of millions of government personnel files that American officials suspect was directed by China, to China’s crackdown on civil liberties, to the devaluation of its currency.
Operation Fox Hunt is not new — or secret. It has been covered before by the US press, including updates on how many people official Chinese sources claim they have gotten to return for prosecution. The NYT follow-up admits — though the original didn’t provide the same level of detail — that DHS agreed in April to prosecute Chinese economic fugitives (which would extend the US habit of asserting jurisdiction where none exists) if provided real evidence of corruption.
But in April, the Department of Homeland Security worked out a new arrangement with China’s Ministry of Public Security, which oversees Operation Fox Hunt, to assist Beijing’s efforts to prosecute economic fugitives according to United States law. American officials, however, say China has so far failed to provide the necessary evidence.
Both NYT articles mention what the WSJ reports in more depth, including details of how these operatives are working: Among the economic fugitives in the US China is aggressively pursuing is Ling Wangcheng, the brother of a former top Hu Jintao aide
Mr. Ling’s brother was a top aide to China’s previous president, Hu Jintao, but was placed under investigation by the Communist Party in December and formally accused in July of bribe-taking, adultery and illegally obtaining state secrets.
For much of 2014, Mr. Ling was living under an alias in a mansion in a gated community in Loomis, Calif., near Sacramento, with Mr. Yuan’s ex-wife, neighbors said. The couple hasn’t been seen there since around October.
Mr. Ling is now the focus of political intrigue that could overshadow a visit to the U.S. in September by China’s leader, Xi Jinping.
Diplomats and analysts said Mr. Ling might have had access through this brother to sensitive information about Chinese leaders. If he sought political asylum, Mr. Ling would be the most significant Chinese defector in decades.
It isn’t clear why Mr. Ling, 55 years old, moved to the U.S. in 2013 or 2014. He lost touch with many friends in China around last fall, a family acquaintance said, but later reassured friends he was safe in the U.S.
The implication from this — and other recent reporting on Ling — is that he did get asylum in October, and has been cooperating with US authorities.
All that is probably only tangentially related to the US leak of its earlier decision — taken precisely as the US tries to find a way to retaliate for the OPM hack — to start cracking down on this Chinese effort.
There are two things I haven’t seen mentioned in coverage of this. First, remember that the US has engaged in a similar effort, using an offer of amnesty for rich tax cheats who had stashed their money in Swiss banks (though there have been what I believe to be similar efforts on the part of the US to expose tax cheats that have mostly focused on non-US citizens).
And don’t forget the lengths to which the US went to get someone who had top secrets to come back to the US, including when it had Austria ground Evo Morales’ plane so it could search for Edward Snowden.
In any case, I suspect the US used Operation Fox Hunt as an opportunity to let China know it knew of these admitted agents. Sort of a way for the US to tell China we know where its operatives in the US are, just as it knows where our operatives are in China, thanks to the OPM hack.
For its part, China’s Xinhua paper has scolded the US for harboring crooks (and provided slightly different details of the agreement pertaining to Fox Hunt).
Corruption is not only a serious problem in China, but also in the rest of the world. And in a world which is more and more connected, countries should take coordinated efforts in fighting corruption.
Although there is no extradition agreement between the United States and China, the two countries actually have already agreed on anti-corruption cooperation.
In April 2015, U.S. Homeland Security Secretary Jeh Johnson met Chinese Public Security Minister Guo Shengkun in Beijing, and they agreed to strengthen cooperation in law enforcement.
They agreed not to provide shelter for the other side’s fugitives and would try to repatriate them in accordance with law. Specifically, Johnson also promised to actively support China’s “Sky Net” and “Fox Hunt” operations, which aim to bring back corrupt officials.
So the U.S. government’s decision to force China’s law enforcement stuff to leave the country obviously reveals that Washington lacks sincerity and has failed to translate its words into action.
Some analysts even say that the United States is reluctant to repatriate those corrupt officials for the sake of their money of course.
Therefore, the United States, as a country that often stresses the rule of law, should clarify the issue and by no means become a safe haven for Chinese criminal suspects.
The US may have decided this would be an easy way to push back on China, but that won’t prevent China from scoring points from it.