Chapter 2: FBI Leadership in National Security
Leadership in national security means many things:
- Devising new ways to protect the public from harm.
- Taking every possible step under existing laws to combat the worst crimes.
- Developing more effective techniques to prevent all types of national security offenses.
- Reacting with the utmost speed and efficiency to deal with new types of national security crimes.
Those who commit national security offenses are tearing at the fabric of our legal system, the Constitution, and our freedoms. Their ultimate aim is the destruction of our democracy.
One of my major priorities has been to seek increased funding for the FBI's counter-terrorism programs. The Congress has shown great foresight in strengthening this vital work. For example, the counter-terrorism budget for Fiscal Year 1996 was $97 million. The FY 1999 budget contains $301 million for counter-terrorism efforts.
One of the national security crimes that has become more prevalent in recent years that is most frightening to all Americans is terrorism.
Some terrorism now comes from abroad. Some terrorism is home-grown. But whatever its origin, terrorism is deadly and the FBI has no higher priority than to combat terrorism; to prevent it where possible; and where prevention fails, to apprehend the terrorists and to do everything within the law to work for conviction and the most severe sentences. Our goal is to prevent, detect and deter.
One of the cases that best illustrates how the FBI reacts to acts of terrorism occurred in the wake of the August 1998 bombings of the United States Embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania. Twelve Americans were among the more than 250 persons killed in Nairobi and 10 persons were killed in Tanzania. More than 5,000 were injured.
Within hours, the first contingent of FBI Special Agents was on its way to both cities to begin an intensive investigation. At the height of our work there, 471 FBI Agents, FBI Laboratory experts, and other FBI specialists worked tirelessly at the sites of both bombings. They collected evidence and worked closely with the very cooperative and committed law enforcement authorities of both nations.
I flew to East Africa to confer with FBI supervisors and personnel in both cities and to personally observe the progress of the investigations. I also met with leaders of Kenya and Tanzania, and we pledged our mutual cooperation to solve these dreadful crimes. Kenya and Tanzania gave us their complete support, for which the FBI and the United States are forever grateful.
One of my priorities has been to develop close ties between the FBI and its law enforcement counterparts in nations throughout the world--what I term "cop-to-cop" relationships that are essential to fight the new types of international crime that harm all law-abiding countries. This goal of close cooperation was of vital importance in the investigation of the Embassy bombings.
Within a short time, assistance from Kenya, Tanzania, Germany, and Pakistan helped the United States identify or detain suspects. Two persons were flown from East Africa to New York and both charged with murder. A third suspect was arrested in Texas.
On November 4, 1998, the major indictment in the case was returned in New York charging Usama Bin Laden, alleged head of the world-wide terrorist organization "al Qaeda," and Muhammad Atef, his military commander, with murder in the Embassy bombings. Mohamed Sadeek Odeh and Mohamed Rashed Daoud Al-'Owhali, who had been brought to New York from East Africa, were charged with murder. Wadih El Hage, who was arrested in Texas, was charged with conspiracy in the fatal bombings. The sixth defendant, Fazul Abdullah Mohammed, was charged with murder, and is a fugitive, along with Bin Laden and Atef.
In September 1998, German authorities arrested Mamdoud Mahmoud Salim on an international provisional arrest warrant coordinated through the FBI's Legal Attache office in Berlin. Salim, an Iraqi Kurd, was charged with conspiracy to murder U.S. citizens and use of weapons of mass destruction in the two Embassy bombings. In December 1998, Salim was extradited to the United States to face the charges.
In December 1998, five additional defendants were indicted on charges of bombing the U.S. Embassy in Tanzania and conspiring to kill American nationals outside of the United States. They are Mustafa Mohammed Fadhil, Khalfan Khamis Mohamed, Ahmed Khalfan Ghailani, Famid Mohammed Ally Msalam, and Sheikh Ahmed Salim Swedan. All are fugitives.
We seek to bring to justice every person who was involved in the bombings. We will accomplish this using all available legal means for as long as it takes.
This case clearly shows the priority that the FBI places on the struggle against terrorism, wherever it is aimed at harming Americans and other innocent victims.
Terrorism can be carried out by U.S. citizens or by persons from other countries. At one time, with these crimes erupting in much of the world, many Americans felt we were immune from terrorism with foreign links. All of that ended in 1993.
The type of terrorism which had previously occurred far from our shores was brought home in a shocking manner when in February a massive explosion occurred in the parking garage at the World Trade Center complex in New York City. Six persons were killed and more than 1,100 injured. The FBI led a coordinated law enforcement effort to determine who was responsible for this terrorist incident, and ultimately identified seven individuals, including Ramzi Ahmed Yousef. Six of the seven were convicted between 1994 and 1997 and are currently serving lengthy prison terms. One individual was indicted but remains a fugitive.
Following the World Trade Center bombing, Ramzi Ahmed Yousef surfaced in the Philippines where he and a group of co-conspirators plotted in 1995 to bomb U.S. commercial airliners in the Far East. Yousef was apprehended abroad in 1995 by FBI Agents and State Department Diplomatic Security Officers and ultimately convicted and sentenced to life in prison. Two coconspirators were also found guilty in 1996.
A major terrorist incident was also prevented in 1993, when the FBI uncovered a plot to bomb a variety of government and critical infrastructure targets across the New York City area. The investigation culminated with multiple arrests. In 1994 and 1995, four defendants entered guilty pleas and ten defendants were convicted, including Sheik Omar Abdel Rahman. Sentences ranged from 15 years to life in prison.
In another major terrorist case in 1993, Mir Aimal Kasi, armed with an AK-47 assault rifle, shot five individuals as they were stopped at the entrance of CIA Headquarters in Langley, Virginia. Two CIA employees were killed and three were seriously wounded. A joint task force was established, consisting of FBI Agents and local detectives. For the next four years, an intensive investigation took place to locate and apprehend Kasi. Through careful coordination with other intelligence and law enforcement agencies, the FBI was able to locate and apprehend Kasi abroad in June, 1997. Kasi was returned to the United States and stood trial in state court for murder. He was later found guilty and sentenced to death.
In 1996, an explosive device contained in a truck detonated outside Building 131 at the Al Khobar Towers in Dhahran, Saudi Arabia, that housed U.S. military personnel. The explosion killed 19 U.S. servicemen and wounded 280. The FBI has conducted an intensive investigation, and has worked with Saudi law enforcement officials to identify and to apprehend those responsible. The FBI has a firm commitment to find and prosecute the bombers, no matter how long it may take.
Through the efforts of FBI Legal Attache offices over an 18-month period, Mohammed Rashid, wanted for the 1982 bombing of a U.S. commercial aircraft, was detained while exiting a Middle Eastern airport. He was returned to the United States in June 1998 to face murder charges. FBI Legal Attaches are Special Agents stationed at U.S. Embassies abroad who work with foreign law enforcement agencies on crime problems of common concern, including locating and apprehending fugitives charged with offenses in the United States.
Domestic Terrorism--Federal Building Bombing
The 1995 bombing of the Alfred P. Murrah Federal Building in Oklahoma City remains the worst terrorist attack ever to occur on American soil, killing 168 persons and wounding nearly 700 more.
It was a crime that shocked the nation and the world. The FBI immediately began one of the most intensive investigations in its history. Law enforcement cooperation played an unusually important part in the initial stages of the investigation: an alert Oklahoma State Police officer arrested one of the subjects on a traffic charge and he was held in custody as the FBI investigation unfolded.
FBI Agents and laboratory and evidence technicians combed the bombing site and Agents were able to link the person in custody to the bombing. The suspect, Timothy James McVeigh, was taken into custody by the FBI and the investigation stretched quickly over a number of states.
As the investigation expanded, the FBI also developed evidence against a second person, Terry Lynn Nichols, and he was also taken into federal custody.
For months, FBI Agents gathered evidence and conducted thousands of interviews as they worked closely with prosecutors from the Department of Justice. At the trial of McVeigh, the painstaking investigative work yielded great dividends for the law-abiding public and the rule of law: McVeigh was convicted of all 11 counts, including eight counts of first degree murder in the deaths of federal law enforcement officers who died in the blast at the federal building. McVeigh was then sentenced to death.
In a later trial, Nichols was also found guilty in the bombing and he received a sentence of life in prison.
In both cases, the evidence gathered in the grueling investigation held up under the sharpest challenges. The credibility and trustworthiness of FBI investigators and Laboratory scientists were unanimously confirmed by the jury and the courts.
One of the FBI's longest violent crime investigations went on for 17 years before ending in the capture of a man wanted for a series of fatal bombings. It was called the UNABOMB case--a code name selected because some of the bombs were set off on university campuses and one was placed aboard an airliner. During the 17 years, beginning in 1978, the serial bomber, later identified as Theodore J. Kaczynski, mailed or placed sixteen improvised explosive devices--killing three persons and injuring 23 others. A crucial development in the case occurred in 1996 when the bomber sent a manuscript to The New York Times and The Washington Post, and both newspapers set a new standard of public service when they published it at the FBI's request. Publication set into motion a series of events that led to the bomber's capture. Kaczynski was living as a recluse near a small town in Montana. The FBI conducted a search of his cabin pursuant to a warrant, found evidence linking him to the bombings, and arrested him. After the beginning of his trial, Theodore Kaczynski agreed to an unconditional plea of guilty to all of the charged acts, as well as bombings for which he was not formally charged. He was sentenced in 1998 to life in prison without possibility of parole.
Another major domestic case involved members of the terrorist group Aryan Nation who set themselves up as an organization called the New Order and conspired to carry out a series of murders, robberies, and weapons violations. Following a careful FBI investigation, six persons were arrested on conspiracy and weapons charges. All either pleaded guilty or were convicted at trial, and sentences of up to seven years in prison were imposed. The FBI investigation showed that the targets of the plot included the Southern Poverty Law Center, the Simon Weisenthal Center in Los Angeles, the Anti-Defamation League of B'nai B'rith, Federal Reserve Chairman Alan Greenspan, and film director Steven Spielberg.
The FBI arrested members of the True Knights of the Ku Klux Klan before they could carry out a plot to bomb a natural gas processing and storage facility in Texas as a diversion to robbing an armored car. Three defendants received sentences ranging from 14 to 22 years in prison.
The FBI has worked closely with our law enforcement partners at home and abroad to bring terrorists to justice. Terrorist incidents are crimes against all humanity. Terrorists must be found, prosecuted and imprisoned. All law enforcement world-wide must cooperate in the fight against terrorists and in the efforts to prevent terrorist incidents wherever they may be planned. This cooperation is working. Between 1993 and 1998, ten individuals charged with terrorism were returned from abroad to the United States by the FBI working in coordination with other U.S. Government agencies and the countries in which those subjects were located.
State-sponsored terrorism is no longer the only terrorism problem. There are new terrorists--loosely organized groups and ad hoc coalitions motivated by perceived injustices or ideologies, along with domestic groups and disgruntled individual American citizens. They have attacked the U.S. at home and abroad. Terrorists represent the very worst of criminals--they attack without regard to the lives of their victims, and they generate fear intended to intimidate nations and democracies. The growing and changing threat of terrorism in the United States has required a well-coordinated and decisive response from the federal law enforcement community. For example, the FBI established a Counterterrorism Center in 1996 after the Federal Building in Oklahoma City was bombed. Eighteen federal agencies maintain a presence in the Center. It was created to strengthen the FBI's ability to track potential terrorist threats, prevent attacks, and investigate events that do occur. The Center has provided invaluable assistance in recent terrorist incidents, including the attacks on the United States Embassies in Kenya and Tanzania.
The threat of domestic terrorism, or international terrorism targeting U.S. interests, is a principal concern of the FBI and other government agencies. This concern is magnified when the terrorism involves a weapon of mass destruction (WMD). Recent national and international events have validated this point and illustrate the need for interagency preparedness.
In Washington, D.C., a container was found at the Anti-Defamation League that was believed to contain a chemical or biological agent. Fortunately, the contents proved harmless. In Buffalo, NY, Stuart Lee Von Adelman was the first person arrested and prosecuted for fraudulently obtaining radioactive material. He posed as a professor of physics and acquired Cadmium 109 and Sodium 22 from legitimate sources in Missouri and California.
In 1995, Larry Wayne Harris, an Ohio resident, obtained three vials of bubonic plague from a Maryland firm using a fraudulent Environmental Protection Agency (EPA) authorization. Harris was convicted of Fraud by Wire. Also in 1995, four Minnesota men who were members of a militia organization were arrested for possession of the chemical agent ricin which they were planning on using against law enforcement officials. They were the first people convicted under the Biological Weapons Anti-Terrorism Act. In 1997, Thomas C. Leahy was convicted in a similar ricin incident that targeted his family.
WMDs have also been used on a larger scale. The bombings in Oklahoma City, OK; the World Trade Center in New York, NY; and the U.S. Embassies in Africa as well as the Tokyo subway sarin attack are tragic examples of terrorism on a large scale.
In 1995, to address events of this kind and bring organization to the federal government's response to a domestic WMD threat or incident, the President issued Presidential Decision Directive-39. PDD-39 established the FBI as the lead federal agency (LFA) in charge of the crisis management aspects of a domestic terrorism WMD threat or incident. The Federal Emergency Management Agency (FEMA) was tasked with LFA status in the area of consequence management.
To fulfill this responsibility, the FBI has implemented a program of interagency contingency planning, exercises, and a command control framework designed to coordinate federal resources and interface with responders from state and local agencies. This team approach recognizes each agency's role in a WMD incident or threat and is designed to take advantage of each agency's unique resources and abilities. Additionally, the concept ensures that federal assets will be available to augment state and local on-scene resources when the scope of an incident exceeds their capabilities.
The FBI is also actively engaged in WMD exercises at all levels. Recently, the FBI and the Department of Defense (DOD) hosted an interagency, national-level WMD field training exercise (FTX) during which the FBI established an interagency Joint Operations Center (JOC) and Joint Information Center (JIC). The FTX was very successful and validated the FBI's WMD response command and control plan. Additionally, the FBI has hosted and participated in numerous interagency WMD table top exercises (TTXs) and the Nunn-Lugar first responder exercises sponsored by the DOD.
Examples of this activity include six interagency regional training seminars hosted by the Milwaukee Field Division that focused on tracking potential terrorists and understanding WMD statutes. The Oklahoma City Field Division hosted a domestic preparedness conference attended by the governors and city officials from four states as well as representatives from DOD and FEMA.
Command, control, and coordination requirements exist beyond the on-site federal response. The ability of local and state agencies to understand how the federal WMD response functions and how national resources will be made available to augment their assets during a WMD incident is crucial. To accomplish this and in response to a plea from local and state authorities, the Attorney General recently established the National Domestic Preparedness Office (NDPO). The NDPO, an interagency organization under direction of the FBI, will provide state and local agencies across the nation a single point-of-contact to coordinate training and readiness.
At the strategic level of command and control, the FBI recently activated the new Strategic Information Operations Center (SIOC). This 40,000 square foot, $20 million facility features the ability to manage several crisis situations simultaneously. A staff of up to 450 personnel may operate from SIOC, allowing the facility to meet the needs of all FBI operational divisions. SIOC operates on a 24-hour a day, 7-days a week basis providing support to FBI Headquarters executives and units, field offices and legal attaches throughout the world. SIOC's mission is operations coordination and information management, serving as the focal point for information flowing into and out of the FBI Headquarters and providing a single point of contact for operational reporting and requests for assistance Bureau wide. During a crisis, SIOC provides the facility, advanced technologies, communication links and trained staff to support the crisis managers and collaborative teams formed to deal with the situation. The SIOC has been designed to support simultaneous events which may have differing operational requirements and varying security levels. Information system resources can be quickly customized to support any event. Located on the fifth floor of the J. Edgar Hoover building, the SIOC facility is close to most of the principal Headquarters National Security Division and Criminal Investigative Division operational units, providing ready access as the situation warrants.
The FBI considers a WMD terrorism event an increasing possibility and is taking every step available to better prepare the FBI and the interagency community for this eventuality.
For the past several years the tactical response to a WMD situation has been the responsibility of the Critical Incident Response Group's (CIRG) Hostage Rescue Team. During 1998 this responsibility was expanded to include the 1,100 Bureau SWAT field Agents. Protective equipment has been procured and an aggressive training package is being developed.
The National Center for Analysis of Violent Crime (NCAVC) has the capability to analyze communicated threats regarding Weapons of Mass Destruction matters. CIRG defines WMD to include nuclear, biological, chemical and large conventional explosive devices for use in domestic terrorism. An agreement exists which details the responsibilities of the various governmental agencies involved in the handling of WMD matters. In preparation for response to WMD issues CIRG has hosted a seminar on the psychological makeup and motivation of groups that have used WMD tactics in the past. A seminar held at Quantico featured Dr. Gerrold Post, a former CIA Director of Psychological Services, and Dr. Ian Reader, who has studied first hand the Aum Shinrikyo organization and their use of sarin gas in 1995 in the Tokyo subway system. CIRG has hosted other seminars on religious/extremist groups that may use WMD tactics as part of their apocalyptic vision. CIRG is continually sensitive to changing trends and organizations which may represent potential threats to the U.S. government and may have the inclination and methodology to use WMD.
NCAVC's Pale Horse Research Project involves a behavioral study of offenders who have previously engaged in WMD threats and activities. CIRG has signed an agreement with the Department of Energy's Office of Nonproliferation and National Security to establish a data base on past WMD offenders and incidents.
Espionage is one of the crimes that inflicts immense damage to the security and interests of the United States. The FBI assigns significant resources to counter-espionage programs and has developed new and beneficial working relationships with other federal agencies to assist in these efforts.
In the past five years, I have made it a top priority to create and enhance closer, more productive ties with the Central Intelligence Agency.
These new relationships between the FBI and CIA are the best and most productive in the history of the long association between the two agencies. Ironically, the relationship we have forged now is better and more effective than the one existing at the height of the Cold War.
Great credit for the close new ties between the two agencies goes to John M. Deutch, who was the catalyst for significant improvements when he served as CIA Director, and they have been carried out and expanded with wisdom and leadership by George J. Tenet, the current CIA Director.
Since the CIA and the FBI are both dedicated to the protection of the American people, full cooperation makes the very best sense--and produces the best results for the nation.
The CIA and FBI now have the closest possible working relationships on national security matters that are among the most sensitive concerns facing the nation: counterterrorism and counterespionage; the protection of intelligence; and the successful investigation and prosecution of cases.
The cooperation is also heightened by exchanges of personnel. High-level Central Intelligence Agency officials work in positions of great authority and line authority at the FBI, and FBI agents hold similar positions at the CIA. Such efforts are an absolute necessity in carrying out our responsibilities to all Americans.
The enhanced partnership has led to solid achievements in the never-ending struggle to ferret out those who have, in league with foreign governments, stolen classified information vital to the security of the United States.
These espionage cases affect the well-being of every American.
One of the most significant results of the new ties between the FBI and CIA is shown in the Aldrich Ames case.
Aldrich Hazen Ames and his wife, Maria Del Rosario Casas Ames, were arrested by the FBI in 1994, and charged with conspiracy to commit espionage. Ames was a 31-year employee of the Central Intelligence Agency who volunteered to spy for the KGB of the Soviet Union in 1985, while serving as the chief of a highly sensitive Soviet branch in the CIA's Directorate of Operations. The FBI's successful investigation resulted in Ames receiving a life sentence without parole. Rosario Ames was sentenced to 63 months in prison. The CIA made a major contribution to this vital case.
Harold J. Nicholson was arrested for conspiracy to commit espionage in 1996, as he attempted to leave the United States for a meeting with agents of the Russian Intelligence Service. He was the highest ranking CIA official ever to be convicted of espionage. Nicholson pled guilty in 1997 to one count of conspiracy to commit espionage. He was sentenced to 23 years and 7 months in prison. This case again shows the benefits of the close working relationship between the FBI and CIA, and the invaluable contributions that the CIA can make to ensure successful investigative accomplishments.
Earl E. Pitts was arrested in 1996, and charged with conspiracy to commit espionage, attempted espionage, and communication of classified information by a government officer.
Pitts, a 13-year veteran Special Agent of the FBI, provided the KGB with sensitive, classified FBI counterintelligence information from 1987 until 1992. Pitts was successfully prosecuted after the FBI conducted a difficult undercover operation which succeeded in reactivating Pitts, a trained counter-intelligence officer himself, and that provided the strongest evidence of his crimes. Pitts was sentenced to 27 years imprisonment. This case shows that spies can be anywhere, and the FBI is determined to find them even if they are on our own rolls.
It is profoundly disturbing that an FBI Special Agent would be a spy for a foreign government. But I am proud that the FBI pursued this case so vigorously, letting the chips fall where they may. The FBI policed itself, even where the most treacherous crimes were involved. The FBI maintained the highest standards in pursuing this case to a successful conclusion.
Late in 1998, the FBI arrested 10 persons in Florida on charges of conducting espionage activities against the United States on behalf of the government of Cuba. The arrests marked the culmination of a lengthy and precedent-setting investigation into Cuban efforts to spy on federal agencies and installations.
In a long and complex investigation by the FBI and other agencies, the government made these allegations in accusing David Sheldon Boone of being an agent of the KGB: In 1988, Boone, a U.S. Army sergeant assigned to the National Security Agency at Ft. Meade, volunteered at the Soviet Embassy in Washington, D.C. During two meetings in the Soviet Embassy complex, and during meetings in Germany following his transfer to Field Station Augsburg, he compromised Top Secret signals intelligence information. In 1991, the Army revoked his clearances and he was reassigned to duties without access to classified information. Shortly thereafter, his contact with the KGB was discontinued. He retired from the Army in 1991. The KGB paid him approximately $60,000 during 1988 through 1991. Boone was arrested following a joint investigation by the FBI and the U.S. Army Foreign Counterintelligence Agency with significant assistance from the National Security Agency. Boone earlier was telephoned by an FBI operational asset, and Boone agreed to meet in London. An undercover operation was conducted in London with the cooperation of the British Security Service during which Boone detailed his prior cooperation with the KGB and agreed to travel to Washington, D.C., for a subsequent meeting, where he was arrested. Late in 1998, Boone pleaded guilty in U.S. District Court in Alexandria, Virginia, to conspiracy to commit espionage.
The FBI investigation of Theresa Squillacote and her husband, Kurt Stand, was predicated on highly reliable information indicating she and her husband were recruited by the former East German Intelligence Service. The investigation determined that they continued their intelligence activities in the United States following the 1990 German unification and during a subsequent FBI undercover operation. They were arrested and following a two-week trial were convicted in 1998 of four counts of espionage.
Another espionage case involving the former East Germany also was investigated successfully by the FBI. The case involved James Clark and allegations that he was recruited by the former East German Intelligence Service. The investigation and a subsequent undercover operation determined conclusively Clark was continuing unlawful clandestine intelligence activities in the United States. He was arrested and pleaded guilty in 1998 to violations of the espionage statutes.
In 1998, Dr. Peter H. Lee, a former Department of Energy scientist, was sentenced on one count of espionage and one count of making false statements to the U.S. Government committed on behalf of the Peoples' Republic of China (PRC). This concluded a seven year investigation by the FBI of Lee which resulted in his interrogation and confession to passing classified information to representatives of the PRC's nuclear weapons development program. The illegal activities for which Lee was charged were committed while he was employed as a research physicist at the Los Alamos National Laboratory in the mid-1980s.
One of the FBI's most important initiatives in the past five years was the development of new strategies and tactics to use in what have become known as "stand-off" situations--cases where groups of armed persons charged with illegal acts barricade themselves in compounds and threaten to use force to block arrests.
The new strategies were developed after the incidents at Ruby Ridge, Idaho, and the Branch Davidian compound in Waco, Texas. One of my first priorities upon joining the Bureau was to develop new plans for resolving standoff situations through negotiations and without harm to anyone while still doing everything necessary to make certain that the law is enforced.
The FBI reviewed its policies regarding use of deadly force and stand-off situations and then created new procedures. One of the first major steps was creation of the Critical Incident Response Group. Among other capabilities, CIRG developed a new, balanced approach to hostage and standoff situations: highly-effective negotiations techniques supported by excellent tactical capabilities if needed. These new policies and approaches received their first test in 1996. The case involved the self-proclaimed "Freemen" in Montana. "Freemen" members had committed numerous criminal acts including conspiracy, bank fraud, mail fraud, wire fraud, false claims, threats to Federal officials, and weapons offenses. In March 1996, two Freemen were arrested by members of The Hostage Rescue Team and an 81-day stand-off ensued with the remaining subjects located on the "Freemen" farm property. Through negotiations and law enforcement patience, the remaining individuals peaceably surrendered after three months and the stand-off was successfully resolved without injury to anyone. Seventeen of the Freemen had been convicted by late October 1998 and charges were pending against five others.
The FBI worked diligently to support the drafting and subsequent passage by Congress of the Economic Espionage Act. The new statute, signed into law in October 1996, created historic, new Federal criminal jurisdiction regarding both state-sponsored and the commercial theft of trade secrets.
Economic Espionage involves the theft of trade secrets and intellectual property and threatens our country's economic health, competitiveness, and security. Our Nation's economic security is synonymous with our national security. Losses to businesses from theft and misappropriation of intellectual property and trade secrets are estimated at billions of dollars per year. The Act created federal jurisdiction regarding both state-sponsored and commercial theft of trade secrets, and the FBI enforces the statute. Notable cases have been investigated by the FBI in a short time, with key indictments brought and some convictions already obtained.
The Act carries a maximum penalty of 15 years in prison for diverting or stealing a trade secret on behalf of a foreign government. It contains a 10-year penalty for commercial theft of trade secrets not involving a foreign power. Both types of cases have been successfully investigated by the FBI.
In one case, a man pleaded guilty to theft of trade secrets involving the development of a new razor by the Gillette Company. The successful investigation prevented a potential loss to Gillette of hundreds of millions of dollars. The defendant, a former employee of a Gillette contractor, was sentenced to 27 months in prison.
In another economic espionage case investigated just prior to the Act's passage, a former official of the Eastman Kodak Company pleaded guilty to interstate transportation of stolen property from the firm and was sentenced to a year in prison.
Other pending cases involve alleged efforts to steal manufacturing information for an anti-cancer drug and medical test equipment.
In addition, FBI investigations led to these prosecutions: the indictment of a man on charges of attempting to purchase blueprints on mining technology; charges against several persons on charges of trying to sell a newspaper's confidential business information to a competitor; charges against two persons who allegedly attempted to sell prototype computer processor chips to a competitor.
In all, a dozen cases have been brought under the Economic Espionage Act since its passage, and many more cases are under investigation.
In February 1998, the National Infrastructure Protection Center (NIPC) was created by Presidential Decision Directive and placed within the FBI to help guard against efforts to harm the nation's critical infrastructure--which includes computers and telecommunications, banking, electric power, gas and oil systems, water supplies, and government operations.
Through a variety of efforts by the FBI and other Federal agencies, NIPC and other parts of the FBI work closely with state and local law enforcement agencies and the private sector components of the infrastructure.
For example, NIPC utilizes the capabilities of Computer Investigations and Infrastructure Threat Assessment Teams located in each of the FBI Field Offices throughout the U.S.
NIPC provides support to FBI field offices in the form of training and materials. NIPC is building a centralized database to identify the different types of problems that occur. The FBI field offices are communication conduits for infrastructure protection issues within the law enforcement community. It is their responsibility to assist other law enforcement agencies in becoming aware of potential vulnerabilities, identifying them, and finding information with which to mitigate or eliminate the risk.
There are currently six National Infrastructure Protection and Computer Intrusion (NIPCI) Squads - Washington, D.C., New York, Los Angeles, Dallas, Chicago and San Francisco. Four new Squads are under consideration for FY 1999 - Atlanta, Boston, Charlotte and Seattle.
A NIPCI Squad is formed on the basis of the number and concentration of the following critical infrastructure sites in a geographic area: U.S. Government agencies, including the Department of Defense and the Department of Energy; financial institutions; universities; and the internet service providers. Site selection also is dependent on the number of personnel who have the technical and computer skills. This allocation is based on the FBI's mission to prevent, respond to, and investigate cyber attacks on this nation's critical infrastructures and to oversee FBI computer crime investigations conducted in the field.
The FBI has identified automated information systems as the greatest area of potential exposure within law enforcement today.
Long before NIPC was created, the FBI was very active in the infrastructure protection field and in 1996 created the Computer Infrastructure Threat Assessment Center. One example of that early work and its expansion is shown by the Cleveland Field Office, which in 1996 organized Information Technology Managers and professionals representing the eight critical infrastructure areas into a group known as InfraGard. This organization consisted of representatives from the business community, academia, other Government agencies and the FBI in a cooperative effort in the exchange of information to ensure the protection of our critical information infrastructure. InfraGard members exchange and disseminate information regarding illegal intrusions, disruptions and vulnerabilities of the information systems of the participating members. From the initial core group of twelve members, the Cleveland chapter has now grown to more than 70 members as a result of the successes of Cleveland's initiative. InfraGard Chapters are also now operating in Columbus, Ohio, and Indianapolis, Indiana. Cleveland's prototype InfraGard Chapter is serving as a model for the establishment of chapters nationwide.
Source: Federal Bureau of Investigation -- http://fbi.gov