1995 Congressional HearingsIntelligence and Security
1995 Congressional Hearings
Chairman Hyde, Ranking Member Conyers, and Members, I
am pleased to appear before you today to discuss a proposal
contained in the anti-terrorism bill in which I've held a
long and serious interest. That proposal would amend the
Fair Credit Reporting Act to provide the FBI with mandatory
access to consumer reporting agency information. I believe
that if approved by Congress, this amendment will add
significantly to the FBI's investigative capabilities. In
fact, I'm told that senior FBI and Justice Department
officials view this proposal as the most important element
of the anti-terrorism package because it will so
significantly augment the ability of the U.S. to combat
terrorist and espionage activities.
I am a Member of the Subcommittee on Financial
Institutions and Consumer Credit of the Banking and
Financial Services Committee. As the Chairman is aware, I
also served for six years as a Member of the Intelligence
Committee. Thus, I believe I have a unique perspective on
both intelligence and banking concerns regarding an
amendment to the FCRA.
An amendment to the Fair Credit Reporting Act addresses
an anomaly in existing law. Under the Right to Financial
Privacy Act (RFPA), the FBI is entitled to obtain Bank and
Credit Card Records. However, before the FBI can request
access to an individual's records under the RFPA, agents
must first identify which financial institutions that
individual is using. Consumer identifying information and
reports maintained by credit bureaus are a ready source of
this information. Financial records are needed to track the
activities of suspected spies or terrorists. In the area of
counterintelligence, there is a growing need in
counterintelligence investigations to follow financial
transactions, as foreign intelligence services are
increasingly operating under nonofficial cover. And, as the
Committee is aware, effective detection of the movement of
terrorist funds is essential to detecting terrorist
capabilities, funding raising activities and criminal
activities.
The amendment to the FCRA as it appears in the
Administration's legislative package Committee's bill would
permit the FBI to obtain limited information regarding a
consumer, upon National Security Letter certification by the
FBI Director. This limited Information would include the
names and addresses of all financial institutions at which a
consumer maintains or has maintained an account, and
identifying information respecting a consumer -- limited to
name, address, former addresses, places of employment, or
former places of employment. In addition, the bill specifies
that the FBI may obtain a consumer report on a consumer if
the director of the FBI obtains a court order that certifies
that there are specific and articulable facts that show that
such information is necessary for an authorized
counterintelligence investigation. It is judged by the
administration that an investigation would seldom, if ever,
require the full consumer report.
The amendment to the Fair Credit Reporting Act would
permit the FBI to conduct investigations of suspected spies
and terrorists more efficiently, effectively and with
greater security. At this time, the FBI, under a court
order, can obtain credit information from a consumer credit
agency. However, because of
the semi-public nature of the court order process, and
because notice to the target would be required at some
point, the FBI prefers not to seek court orders. Today's
counterintelligence target is generally a sophisticated one;
the same can be said of many terrorist groups, who, as the
Committee knows, seem to have a good grounding in U.S. law
and frequently have devised ways to exploit or evade its
strictures.
It is true that information on an individual's
financial associations can be obtained by other
investigatory activities. These activities could include
mail covers, surveillance, or interviews with associates.
However, these are much more time consuming, and they are
potentially more invasive to the suspected individual's
privacy. Moreover, due to their invasiveness, there is an
increased likelihood of detection by the suspect party. Any
hint to the subject that he or she is under investigation
will likely cause that individual to cease activity and thus
the ability to prosecute the case may be lost through a
failure to prove the necessary elements. The Bureau needs
other less intrusive and lower risk techniques to obtain the
lead material to bring a case to a prosecutive stage and to
maximize the intelligence to be gained prior to a case
becoming public. Granting
the FBI mandatory access via a National Security Letter to
consumer credit information can shorten the investigatory
process and lesson the chance of detection.
Mr. Chairman, this amendment has enjoyed the support of
the House. Last year, while still a Member of the
Intelligence Committee, I introduced the FBI
Counterintelligence Act that sought to amend the Fair Credit
Reporting Act. This was done to follow up on an agreement
made between the Intelligence Committees during their
conference on the FY95 Intelligence Authorization Act. The
Intelligence Committees supported the amendment and were
prepared to act on the amendment in their conference.
However, the Committees agreed to defer any action due to
the jurisdictional concerns of the House Banking Committee.
The House Banking Committee also introduced legislation
similar to mine following the Intelligence conference. Both
measures were passed by the House, but unfortunately were
not acted on in the final hours of Senate's 103rd session.
At the beginning of the 104th Session, I once more
introduced identical legislation as H.R. 68.
The proposal to amend the FCRA in the Committee's anti-
terrorism bill mirrors H.R. 68, and I look forward to seeing
it approved as part of your Committee's anti-terrorism
legislation. I understand that there has been some
discussion on dropping the sunset provision, and I am fully
supportive of doing So, if that is the determination of this
Committee.
Mr. Chairman, permitting the FBI mandatory access to
consumer credit reporting information is an important step
toward improving our nation's ability to combat terrorism in
that it will permit investigations to be conducted with
greater efficiency and effectiveness.
Thank you for asking me here today to comment on this
proposal. I would be glad to answer any questions that the
Committee might have.