“Lavabit, Snowden’s E-Mail Service, in a Legal Tug of War”

October 3, 2013

The New York Times on October 2, 2013 released the following:

By NICOLE PERLROTH and SCOTT SHANE

“DALLAS — One day last May, Ladar Levison returned home to find an F.B.I. agent’s business card on his Dallas doorstep. So began a four-month tangle with law enforcement officials that would end with Mr. Levison’s shutting the business he had spent a decade building and becoming an unlikely hero of privacy advocates in their escalating battle with the government over Internet security.

Prosecutors, it turned out, were pursuing a notable user of Lavabit, Mr. Levison’s secure e-mail service: Edward J. Snowden, the former National Security Agency contractor who leaked classified documents that have put the intelligence agency under sharp scrutiny. Mr. Levison was willing to allow investigators with a court order to tap Mr. Snowden’s e-mail account; he had complied with similar narrowly targeted requests involving other customers some two dozen times.

But they wanted more, he said: the passwords, encryption keys and computer code that would essentially allow the government untrammeled access to the protected messages of all his customers. That, he said, was too much.

“You don’t need to bug an entire city to bug one guy’s phone calls,” Mr. Levison, 32, said in a recent interview. “In my case, they wanted to break open the entire box just to get to one connection.”

On Aug. 8, Mr. Levison closed Lavabit rather than, in his view, betray his promise of secure e-mail to his customers. The move, which he explained in a letter on his Web site, drew fervent support from civil libertarians but was seen by prosecutors as an act of defiance that fell just short of a crime.

The full story of what happened to Mr. Levison since May has not previously been told, in part because he was subject to a court’s gag order. But on Wednesday, a federal judge unsealed documents in the case, allowing the tech entrepreneur to speak candidly for the first time about his experiences. He had been summoned to testify to a grand jury in Virginia; forbidden to discuss his case; held in contempt of court and fined $10,000 for handing over his private encryption keys on paper and not in digital form; and, finally, threatened with arrest for saying too much when he shuttered his business.

Spokesmen for the Justice Department and the F.B.I. said they had no comment beyond what was in the documents.

Mr. Levison’s battle to preserve his customers’ privacy comes at a time when Mr. Snowden’s disclosures have ignited a national debate about the proper limits of surveillance and government intrusion into American Internet companies that promise users that their digital communications are secure.

Much of the attention has been focused on Internet giants like Microsoft and Google. Lavabit, with just two employees and perhaps 40,000 regular users, was a midget by comparison, but its size and Mr. Levison’s personal pledge of security made it attractive to tech-savvy users like Mr. Snowden.

While Mr. Levison’s struggles have been with the F.B.I., hovering in the background is the N.S.A., which has worked secretly for years to undermine or bypass encrypted services like Lavabit so that their electronic message scrambling cannot obstruct the agency’s spying. Earlier in September, The New York Times, ProPublica and The Guardian wrote about the N.S.A.’s campaign to weaken encryption. Mr. Levison’s case shows how law enforcement officials can use legal tools to pry open messages, no matter how well protected.

Mr. Levison said he set up Lavabit to make it impossible for outsiders, whether governments or hackers, to spy on users’ communications. He followed the government’s own secure coding guidelines, based on the N.S.A.’s technical guidance, and engineered his systems so as not to log user communications. That way, even if he received a subpoena for a user’s communications, he would not be able to gain access to them. For added measure, he gave customers the option to pay extra to encrypt their e-mail and passwords.

Mr. Levison, who studied politics and computer science at Southern Methodist University, started Lavabit in April 2004, the same month Google rolled out Gmail. To pay his bills, he worked as a Web consultant, helping develop Web sites for major brands like Dr Pepper, Nokia and Adidas. But by 2010, the e-mail service had attracted enough paying customers to allow Mr. Levison to turn to Lavabit full time.

The agent did not mention at first who the government was pursuing, and Mr. Levison will not name the targets of the government’s investigation. The name was redacted from the court order unsealed Wednesday, but the offenses listed are violations of the Espionage Act, and the timing of the government’s case coincides with its leak investigation into Mr. Snowden, which began in May when he fled Hawaii for Hong Kong carrying laptops containing thousands of classified documents.

By then, Mr. Snowden’s Lavabit e-mail address was already public. He had listed his personal Lavabit e-mail address in January 2010, and was still using a Lavabit address this July, when he summoned reporters to a news conference at the Moscow airport.

That e-mail invitation proved to be an unintended endorsement for Lavabit’s security. Before that, Mr. Levison said that, on average, Lavabit was signing up 200 new users daily. In the days after Mr. Snowden’s e-mail, more than 4,000 new customers joined each day.

But a month before the news conference, court documents show, Mr. Levison had already received a subpoena for Mr. Snowden’s encrypted e-mail account. The government was particularly interested in his e-mail metadata — with whom Mr. Snowden was communicating, when and from where. The order, from the Federal District Court in Alexandria, Va., required Mr. Levison to log Mr. Snowden’s account information and provide the F.B.I. with “technical assistance,” which agents told him meant handing over the private encryption keys, technically called SSL certificates, that unlock communications for all users, he said.

“It was the equivalent of asking Coca-Cola to hand over its secret formula,” Mr. Levison said.

By July, he said, he had 410,000 registered users. Similar services like Hushmail, a Canadian encrypted e-mail service, had lost users in 2007 after court documents revealed that the company had handed 12 CDs’ worth of decoded e-mails from three Hushmail accounts to American law enforcement officials through a mutual assistance treaty.

“The whole concept of the Internet was built on the idea that companies can keep their own keys,” Mr. Levison said. He told the agents that he would need their request for his encryption keys in writing.

A redacted version of that request, which was among the 23 documents that were unsealed, shows that the court issued an order July 16 for Lavabit’s encryption keys. Prosecutors said they had no intention of collecting any information on Lavabit’s 400,000 other customers. “There’s no agents looking through the 400,000 other bits of information, customers, whatever,” Jim Trump, one of the prosecutors, said at a closed Aug. 1 hearing.

But Mr. Levison said he spent much of the following day thinking of a compromise. He would log the target’s communications, unscramble them with the encryption keys and upload them to a government server once a day. The F.B.I. told him that was not enough. It needed his target’s communications “in real time,” he said.

“How as a small business do you hire the lawyers to appeal this and change public opinion to get the laws changed when Congress doesn’t even know what is going on?” Mr. Levison said.

When it was clear Mr. Levison had no choice but to comply, he devised a way to obey the order but make the government’s intrusion more arduous. On Aug 2, he infuriated agents by printing the encryption keys — long strings of seemingly random numbers — on paper in a font he believed would be hard to scan and turn into a usable digital format. Indeed, prosecutors described the file as “largely illegible.”

On Aug. 5, Judge Claude M. Hilton ordered a $5,000-a-day fine until Mr. Levison produced the keys in electronic form. Mr. Levison’s lawyer, Jesse R. Binnall, appealed both the order to turn over the keys and the fine.

After two days, Mr. Levison gave in, turning over the digital keys — and simultaneously closing his e-mail service, apologizing to customers on his site. That double maneuver, a prosecutor later told his lawyer, fell just short of a criminal act.

He hopes to resurrect the business he spent a decade building. “This wasn’t about one person,” Mr. Levison said. “This was about the lengths our government was willing to go to conduct Internet surveillance on one person.””

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Crimes – Appeal

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.



“N.S.A. Experiment Traced U.S. Cellphone Locations”

October 3, 2013

The New York Times on October 2, 2013 released the following:

By CHARLIE SAVAGE

“WASHINGTON — The National Security Agency in 2010 and 2011 conducted a secret pilot project to test the collection of bulk data about the location of Americans’ cellphones, but the agency ultimately decided against putting such a program into play for now, according to intelligence officials.

The existence of the pilot project, which has not previously been reported, was recently declassified by James R. Clapper, the director of national intelligence, but it has not been publicly disclosed. It was outlined in a draft answer obtained by The New York Times and written for Mr. Clapper to read at a Senate Judiciary Committee hearing on Wednesday if he is asked about the topic.

The answer is one paragraph long and contains scant details. It says that the N.S.A. does not currently collect locational information under Section 215 of the Patriot Act, the provision that forms the asserted legal basis of its once-secret program that is collecting logs of all domestic phone calls from telephone companies.

“In 2010 and 2011 N.S.A. received samples in order to test the ability of its systems to handle the data format, but that data was not used for any other purpose and was never available for intelligence analysis purposes,” the draft answer says, adding that the N.S.A. has promised to notify Congress and seek the approval of a secret surveillance court in the future before any locational data was collected using Section 215.

An official familiar with the test project said its purpose was to see how the locational data would flow into the N.S.A.’s systems. While real data was used, it was never queried as part of any investigation, the official said. It was unclear how many Americans’ locational data was ingested as part of the project or whether the N.S.A. has held onto that information.

But Senator Ron Wyden, an Oregon Democrat who receives classified briefings as a member of the Intelligence Committee and who has raised oblique concerns about cellphone location tracking, said in a statement on Wednesday that there was more to know about the matter than the government has declassified.

“After years of stonewalling on whether the government has ever tracked or planned to track the location of law-abiding Americans through their cellphones, once again, the intelligence leadership has decided to leave most of the real story secret — even when the truth would not compromise national security,” Mr. Wyden said.

Questions about what, if anything, the N.S.A. has been doing in the bulk tracking of Americans’ movements using cell-site location data have been simmering for several years. The issue flared again last week following an ambiguous exchange between Mr. Wyden and Gen. Keith B. Alexander, the director of the N.S.A., at a Senate Intelligence Committee hearing.

Mr. Wyden has been a critic of domestic surveillance programs and filed legislation in 2011 and again this year that would require warrants for obtaining someone’s locational data for a criminal investigation, while leaving ambiguous whether a similar step was also necessary in the context of a national security investigation. It is unclear what prompted his concerns.

At the hearing, he asked Mr. Alexander “whether the N.S.A. has ever collected or made any plans to collect Americans’ cell-site information in bulk.”

General Alexander replied that the N.S.A. “is not receiving cell-site location data and has no current plans to do so” under Section 215 of the Patriot Act, which allows the secret surveillance court to issue orders for records from businesses — like telephone companies — if the records are “relevant” to an intelligence investigation.

But General Alexander also said there was other classified information that the N.S.A. had sent to the committee in July, in response to a written version of the same question, that provided “additional detail” responsive to the issue.

It is legally unclear whether long-term tracking of people’s locations and movements by the government raises privacy rights under the Fourth Amendment. In a 1979 case involving small-scale collection of “metadata” about telephone calls — information related to the calls, like the number dialed and the duration, but not the contents of the communications — the Supreme Court ruled that such records were not protected by the Constitution because people have already revealed the existence of their calls to telephone companies and so have no reasonable expectation of privacy.

But in 2012, the court ruled that the police’s use of a G.P.S. tracker attached to a suspect’s car violated Fourth Amendment privacy rights. The case turned on the fact that the police had to trespass on the suspect’s property to attach the device, but five justices separately suggested that any long-term, automated collection of a person’s public movements might raise Fourth Amendment issues.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

Federal Crimes – Appeal

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


“Exclusive: IRS manual detailed DEA’s use of hidden intel evidence”

August 8, 2013

Reuters on August 7, 2013 released the following:

By John Shiffman and David Ingram

“(Reuters) – Details of a U.S. Drug Enforcement Administration program that feeds tips to federal agents and then instructs them to alter the investigative trail were published in a manual used by agents of the Internal Revenue Service for two years.

The practice of recreating the investigative trail, highly criticized by former prosecutors and defense lawyers after Reuters reported it this week, is now under review by the Justice Department. Two high-profile Republicans have also raised questions about the procedure.

A 350-word entry in the Internal Revenue Manual instructed agents of the U.S. tax agency to omit any reference to tips supplied by the DEA’s Special Operations Division, especially from affidavits, court proceedings or investigative files. The entry was published and posted online in 2005 and 2006, and was removed in early 2007. The IRS is among two dozen arms of the government working with the Special Operations Division, including the Federal Bureau of Investigation, the National Security Agency and the Central Intelligence Agency.

An IRS spokesman had no comment on the entry or on why it was removed from the manual. Reuters recovered the previous editions from the archives of the Westlaw legal database, which is owned by Thomson Reuters Corp, the parent of this news agency.

As Reuters reported Monday, the Special Operations Division of the DEA funnels information from overseas NSA intercepts, domestic wiretaps, informants and a large DEA database of telephone records to authorities nationwide to help them launch criminal investigations of Americans. The DEA phone database is distinct from a NSA database disclosed by former NSA contractor Edward Snowden.

Monday’s Reuters report cited internal government documents that show that law enforcement agents have been trained to conceal how such investigations truly begin – to “recreate” the investigative trail to effectively cover up the original source of the information.

DEA officials said the practice is legal and has been in near-daily use since the 1990s. They have said that its purpose is to protect sources and methods, not to withhold evidence.

NEW DETAIL

Defense attorneys and some former judges and prosecutors say that systematically hiding potential evidence from defendants violates the U.S. Constitution. According to documents and interviews, agents use a procedure they call “parallel construction” to recreate the investigative trail, stating in affidavits or in court, for example, that an investigation began with a traffic infraction rather than an SOD tip.

The IRS document offers further detail on the parallel construction program.

“Special Operations Division has the ability to collect, collate, analyze, evaluate, and disseminate information and intelligence derived from worldwide multi-agency sources, including classified projects,” the IRS document says. “SOD converts extremely sensitive information into usable leads and tips which are then passed to the field offices for real-time enforcement activity against major international drug trafficking organizations.”

The 2005 IRS document focuses on SOD tips that are classified and notes that the Justice Department “closely guards the information provided by SOD with strict oversight.” While the IRS document says that SOD information may only be used for drug investigations, DEA officials said the SOD role has recently expanded to organized crime and money laundering.

According to the document, IRS agents are directed to use the tips to find new, “independent” evidence: “Usable information regarding these leads must be developed from such independent sources as investigative files, subscriber and toll requests, physical surveillance, wire intercepts, and confidential source information. Information obtained from SOD in response to a search or query request cannot be used directly in any investigation (i.e. cannot be used in affidavits, court proceedings or maintained in investigative files).”

The IRS document makes no reference to SOD’s sources of information, which include a large DEA telephone and Internet database.

CONCERN IN CONGRESS

House Intelligence Committee Chairman Mike Rogers, R-Michigan, expressed concern with the concept of parallel construction as a method to hide the origin of an investigation. His comments came on the Mike Huckabee Show radio program.

“If they’re recreating a trail, that’s wrong and we’re going to have to do something about it,” said Rogers, a former FBI agent. “We’re working with the DEA and intelligence organizations to try to find out exactly what that story is.”

Spokespeople for the DEA and the Department of Justice declined to comment.

Sen. Rand Paul, R-Kentucky, a member of the Homeland Security and Government Affairs Committee, said he was troubled that DEA agents have been “trying to cover up a program that investigates Americans.”

“National security is one of government’s most important functions. So is protecting individual liberty,” Paul said. “If the Constitution still has any sway, a government that is constantly overreaching on security while completely neglecting liberty is in grave violation of our founding doctrine.”

Officials have stressed that the NSA and DEA telephone databases are distinct. The NSA database, disclosed by Snowden, includes data about every telephone call placed inside the United States. An NSA official said that database is not used for domestic criminal law enforcement.

The DEA database, called DICE, consists largely of phone log and Internet data gathered legally by the DEA through subpoenas, arrests and search warrants nationwide. DICE includes about 1 billion records, and they are kept for about a year and then purged, DEA officials said.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

Federal Crimes – Appeal

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


“Exclusive: U.S. directs agents to cover up program used to investigate Americans”

August 5, 2013

Reuters on August 5, 2013 released the following:

“By John Shiffman and Kristina Cooke

WASHINGTON – A secretive U.S. Drug Enforcement Administration unit is funneling information from intelligence intercepts, wiretaps, informants and a massive database of telephone records to authorities across the nation to help them launch criminal investigations of Americans.

Although these cases rarely involve national security issues, documents reviewed by Reuters show that law enforcement agents have been directed to conceal how such investigations truly begin – not only from defense lawyers but also sometimes from prosecutors and judges.

The undated documents show that federal agents are trained to “recreate” the investigative trail to effectively cover up where the information originated, a practice that some experts say violates a defendant’s Constitutional right to a fair trial. If defendants don’t know how an investigation began, they cannot know to ask to review potential sources of exculpatory evidence – information that could reveal entrapment, mistakes or biased witnesses.

“I have never heard of anything like this at all,” said Nancy Gertner, a Harvard Law School professor who served as a federal judge from 1994 to 2011. Gertner and other legal experts said the program sounds more troubling than recent disclosures that the National Security Agency has been collecting domestic phone records. The NSA effort is geared toward stopping terrorists; the DEA program targets common criminals, primarily drug dealers.

“It is one thing to create special rules for national security,” Gertner said. “Ordinary crime is entirely different. It sounds like they are phonying up investigations.”

THE SPECIAL OPERATIONS DIVISION

The unit of the DEA that distributes the information is called the Special Operations Division, or SOD. Two dozen partner agencies comprise the unit, including the FBI, CIA, NSA, Internal Revenue Service and the Department of Homeland Security. It was created in 1994 to combat Latin American drug cartels and has grown from several dozen employees to several hundred.

Today, much of the SOD’s work is classified, and officials asked that its precise location in Virginia not be revealed. The documents reviewed by Reuters are marked “Law Enforcement Sensitive,” a government categorization that is meant to keep them confidential.

“Remember that the utilization of SOD cannot be revealed or discussed in any investigative function,” a document presented to agents reads. The document specifically directs agents to omit the SOD’s involvement from investigative reports, affidavits, discussions with prosecutors and courtroom testimony. Agents are instructed to then use “normal investigative techniques to recreate the information provided by SOD.”

A spokesman with the Department of Justice, which oversees the DEA, declined to comment.

But two senior DEA officials defended the program, and said trying to “recreate” an investigative trail is not only legal but a technique that is used almost daily.

A former federal agent in the northeastern United States who received such tips from SOD described the process. “You’d be told only, ‘Be at a certain truck stop at a certain time and look for a certain vehicle.’ And so we’d alert the state police to find an excuse to stop that vehicle, and then have a drug dog search it,” the agent said.

“PARALLEL CONSTRUCTION”

After an arrest was made, agents then pretended that their investigation began with the traffic stop, not with the SOD tip, the former agent said. The training document reviewed by Reuters refers to this process as “parallel construction.”

The two senior DEA officials, who spoke on behalf of the agency but only on condition of anonymity, said the process is kept secret to protect sources and investigative methods. “Parallel construction is a law enforcement technique we use every day,” one official said. “It’s decades old, a bedrock concept.”

A dozen current or former federal agents interviewed by Reuters confirmed they had used parallel construction during their careers. Most defended the practice; some said they understood why those outside law enforcement might be concerned.

“It’s just like laundering money – you work it backwards to make it clean,” said Finn Selander, a DEA agent from 1991 to 2008 and now a member of a group called Law Enforcement Against Prohibition, which advocates legalizing and regulating narcotics.

Some defense lawyers and former prosecutors said that using “parallel construction” may be legal to establish probable cause for an arrest. But they said employing the practice as a means of disguising how an investigation began may violate pretrial discovery rules by burying evidence that could prove useful to criminal defendants.

A QUESTION OF CONSTITUTIONALITY

“That’s outrageous,” said Tampa attorney James Felman, a vice chairman of the criminal justice section of the American Bar Association. “It strikes me as indefensible.”

Lawrence Lustberg, a New Jersey defense lawyer, said any systematic government effort to conceal the circumstances under which cases begin “would not only be alarming but pretty blatantly unconstitutional.”

Lustberg and others said the government’s use of the SOD program skirts established court procedures by which judges privately examine sensitive information, such as an informant’s identity or classified evidence, to determine whether the information is relevant to the defense.

“You can’t game the system,” said former federal prosecutor Henry E. Hockeimer Jr. “You can’t create this subterfuge. These are drug crimes, not national security cases. If you don’t draw the line here, where do you draw it?”

Some lawyers say there can be legitimate reasons for not revealing sources. Robert Spelke, a former prosecutor who spent seven years as a senior DEA lawyer, said some sources are classified. But he also said there are few reasons why unclassified evidence should be concealed at trial.

“It’s a balancing act, and they’ve doing it this way for years,” Spelke said. “Do I think it’s a good way to do it? No, because now that I’m a defense lawyer, I see how difficult it is to challenge.”

CONCEALING A TIP

One current federal prosecutor learned how agents were using SOD tips after a drug agent misled him, the prosecutor told Reuters. In a Florida drug case he was handling, the prosecutor said, a DEA agent told him the investigation of a U.S. citizen began with a tip from an informant. When the prosecutor pressed for more information, he said, a DEA supervisor intervened and revealed that the tip had actually come through the SOD and from an NSA intercept.

“I was pissed,” the prosecutor said. “Lying about where the information came from is a bad start if you’re trying to comply with the law because it can lead to all kinds of problems with discovery and candor to the court.” The prosecutor never filed charges in the case because he lost confidence in the investigation, he said.

A senior DEA official said he was not aware of the case but said the agent should not have misled the prosecutor. How often such misdirection occurs is unknown, even to the government; the DEA official said the agency does not track what happens with tips after the SOD sends them to agents in the field.

The SOD’s role providing information to agents isn’t itself a secret. It is briefly mentioned by the DEA in budget documents, albeit without any reference to how that information is used or represented when cases go to court.

The DEA has long publicly touted the SOD’s role in multi-jurisdictional and international investigations, connecting agents in separate cities who may be unwittingly investigating the same target and making sure undercover agents don’t accidentally try to arrest each other.

SOD’S BIG SUCCESSES

The unit also played a major role in a 2008 DEA sting in Thailand against Russian arms dealer Viktor Bout; he was sentenced in 2011 to 25 years in prison on charges of conspiring to sell weapons to the Colombian rebel group FARC. The SOD also recently coordinated Project Synergy, a crackdown against manufacturers, wholesalers and retailers of synthetic designer drugs that spanned 35 states and resulted in 227 arrests.

Since its inception, the SOD’s mandate has expanded to include narco-terrorism, organized crime and gangs. A DEA spokesman declined to comment on the unit’s annual budget. A recent LinkedIn posting on the personal page of a senior SOD official estimated it to be $125 million.

Today, the SOD offers at least three services to federal, state and local law enforcement agents: coordinating international investigations such as the Bout case; distributing tips from overseas NSA intercepts, informants, foreign law enforcement partners and domestic wiretaps; and circulating tips from a massive database known as DICE.

The DICE database contains about 1 billion records, the senior DEA officials said. The majority of the records consist of phone log and Internet data gathered legally by the DEA through subpoenas, arrests and search warrants nationwide. Records are kept for about a year and then purged, the DEA officials said.

About 10,000 federal, state and local law enforcement agents have access to the DICE database, records show. They can query it to try to link otherwise disparate clues. Recently, one of the DEA officials said, DICE linked a man who tried to smuggle $100,000 over the U.S. southwest border to a major drug case on the East Coast.

“We use it to connect the dots,” the official said.

“AN AMAZING TOOL”

Wiretap tips forwarded by the SOD usually come from foreign governments, U.S. intelligence agencies or court-authorized domestic phone recordings. Because warrantless eavesdropping on Americans is illegal, tips from intelligence agencies are generally not forwarded to the SOD until a caller’s citizenship can be verified, according to one senior law enforcement official and one former U.S. military intelligence analyst.

“They do a pretty good job of screening, but it can be a struggle to know for sure whether the person on a wiretap is American,” the senior law enforcement official said.

Tips from domestic wiretaps typically occur when agents use information gleaned from a court-ordered wiretap in one case to start a second investigation.

As a practical matter, law enforcement agents said they usually don’t worry that SOD’s involvement will be exposed in court. That’s because most drug-trafficking defendants plead guilty before trial and therefore never request to see the evidence against them. If cases did go to trial, current and former agents said, charges were sometimes dropped to avoid the risk of exposing SOD involvement.

Current and former federal agents said SOD tips aren’t always helpful – one estimated their accuracy at 60 percent. But current and former agents said tips have enabled them to catch drug smugglers who might have gotten away.

“It was an amazing tool,” said one recently retired federal agent. “Our big fear was that it wouldn’t stay secret.”

DEA officials said that the SOD process has been reviewed internally. They declined to provide Reuters with a copy of their most recent review.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


“U.S. Postal Service Logging All Mail for Law Enforcement”

July 3, 2013

The New York Times on July 3, 2013 released the following:

“By RON NIXON

WASHINGTON — Leslie James Pickering noticed something odd in his mail last September: A handwritten card, apparently delivered by mistake, with instructions for postal workers to pay special attention to the letters and packages sent to his home.

“Show all mail to supv” — supervisor — “for copying prior to going out on the street,” read the card. It included Mr. Pickering’s name, address and the type of mail that needed to be monitored. The word “confidential” was highlighted in green.

“It was a bit of a shock to see it,” said Mr. Pickering, who owns a small bookstore in Buffalo. More than a decade ago, he was a spokesman for the Earth Liberation Front, a radical environmental group labeled eco-terrorists by the Federal Bureau of Investigation. Postal officials subsequently confirmed they were indeed tracking Mr. Pickering’s mail but told him nothing else.

As the world focuses on the high-tech spying of the National Security Agency, the misplaced card offers a rare glimpse inside the seemingly low-tech but prevalent snooping of the United States Postal Service.

Mr. Pickering was targeted by a longtime surveillance system called mail covers, but that is only a forerunner of a vastly more expansive effort, the Mail Isolation Control and Tracking program, in which Postal Service computers photograph the exterior of every piece of paper mail that is processed in the United States — about 160 billion pieces last year. It is not known how long the government saves the images.

Together, the two programs show that snail mail is subject to the same kind of scrutiny that the National Security Agency has given to telephone calls and e-mail.

The mail covers program, used to monitor Mr. Pickering, is more than a century old but is still considered a powerful tool. At the request of law enforcement officials, postal workers record information from the outside of letters and parcels before they are delivered. (Actually opening the mail requires a warrant.) The information is sent to whatever law enforcement agency asked for it. Tens of thousands of pieces of mail each year undergo this scrutiny.

The Mail Isolation Control and Tracking program was created after the anthrax attacks in late 2001 that killed five people, including two postal workers. Highly secret, it seeped into public view last month when the F.B.I. cited it in its investigation of ricin-laced letters sent to President Obama and Mayor Michael R. Bloomberg. It enables the Postal Service to retroactively track mail correspondence at the request of law enforcement. No one disputes that it is sweeping.

“In the past, mail covers were used when you had a reason to suspect someone of a crime,” said Mark D. Rasch, the former director of the Justice Department’s computer crime unit, who worked on several fraud cases using mail covers. “Now it seems to be ‘Let’s record everyone’s mail so in the future we might go back and see who you were communicating with.’ Essentially you’ve added mail covers on millions of Americans.”

Bruce Schneier, a computer security expert and an author, said whether it was a postal worker taking down information or a computer taking images, the program was still an invasion of privacy.

“Basically they are doing the same thing as the other programs, collecting the information on the outside of your mail, the metadata, if you will, of names, addresses, return addresses and postmark locations, which gives the government a pretty good map of your contacts, even if they aren’t reading the contents,” he said.

But law enforcement officials said mail covers and the automatic mail tracking program are invaluable, even in an era of smartphones and e-mail.

In a criminal complaint filed June 7 in Federal District Court in Eastern Texas, the F.B.I. said a postal investigator tracing the ricin letters was able to narrow the search to Shannon Guess Richardson, an actress in New Boston, Tex., by examining information from the front and back images of 60 pieces of mail scanned immediately before and after the tainted letters sent to Mr. Obama and Mr. Bloomberg showing return addresses near her home. Ms. Richardson had originally accused her husband of mailing the letters, but investigators determined that he was at work during the time they were mailed.

In 2007, the F.B.I., the Internal Revenue Service and the local police in Charlotte, N.C., used information gleaned from the mail cover program to arrest Sallie Wamsley-Saxon and her husband, Donald, charging both with running a prostitution ring that took in $3 million over six years. Prosecutors said it was one of the largest and most successful such operations in the country. Investigators also used mail covers to help track banking activity and other businesses the couple operated under different names.

Other agencies, including the Drug Enforcement Administration and the Department of Health and Human Services, have used mail covers to track drug smugglers and Medicare fraud.

“It’s a treasure trove of information,” said James J. Wedick, a former F.B.I. agent who spent 34 years at the agency and who said he used mail covers in a number of investigations, including one that led to the prosecution of several elected officials in California on corruption charges. “Looking at just the outside of letters and other mail, I can see who you bank with, who you communicate with — all kinds of useful information that gives investigators leads that they can then follow up on with a subpoena.”

But, he said: “It can be easily abused because it’s so easy to use and you don’t have to go through a judge to get the information. You just fill out a form.”

For mail cover requests, law enforcement agencies simply submit a letter to the Postal Service, which can grant or deny a request without judicial review. Law enforcement officials say the Postal Service rarely denies a request. In other government surveillance program, such as wiretaps, a federal judge must sign off on the requests.

The mail cover surveillance requests are granted for about 30 days, and can be extended for up to 120 days. There are two kinds of mail covers: those related to criminal activity and those requested to protect national security. The criminal activity requests average 15,000 to 20,000 per year, said law enforcement officials who spoke on the condition of anonymity because they are prohibited by law from discussing the requests. The number of requests for antiterrorism mail covers has not been made public.

Law enforcement officials need warrants to open the mail, although President George W. Bush asserted in a signing statement in 2007 that the federal government had the authority to open mail without warrants in emergencies or foreign intelligence cases.

Court challenges to mail covers have generally failed because judges have ruled that there is no reasonable expectation of privacy for information contained on the outside of a letter. Officials in both the George W. Bush and Obama administrations, in fact, have used the mail-cover court rulings to justify the N.S.A.’s surveillance programs, saying the electronic monitoring amounts to the same thing as a mail cover. Congress briefly conducted hearings on mail cover programs in 1976, but has not revisited the issue.

The program has led to sporadic reports of abuse. In May 2012, Mary Rose Wilcox, a Maricopa County supervisor, was awarded nearly $1 million by a federal judge after winning a lawsuit against Sheriff Joe Arpaio, known for his immigration raids in Arizona, who, among other things, obtained mail covers from the Postal Service to track her mail. The judge called the investigation into Ms. Wilcox politically motivated because she had been a frequent critic of Mr. Arpaio, objecting to what she considered the targeting of Hispanics in his immigration sweeps. The case is being appealed.

In the mid-1970s the Church Committee, a Senate panel that documented C.I.A. abuses, faulted a program created in the 1950s in New York that used mail covers to trace and sometimes open mail going to the Soviet Union from the United States.

A suit brought in 1973 by a high school student in New Jersey, whose letter to the Socialist Workers Party was traced by the F.B.I. as part of an investigation into the group, led to a rebuke from a federal judge.

Postal officials refused to discuss either mail covers or the Mail Isolation Control and Tracking program.

Mr. Pickering says he suspects that the F.B.I. requested the mail cover to monitor his mail because a former associate said the bureau had called with questions about him. Last month, he filed a lawsuit against the Postal Service, the F.B.I. and other agencies, saying they were improperly withholding information.

A spokeswoman for the F.B.I. in Buffalo declined to comment.

Mr. Pickering said that although he was arrested two dozen times for acts of civil disobedience and convicted of a handful of misdemeanors, he was never involved in the arson attacks the Earth Liberation Front carried out. He said he became tired of focusing only on environmental activism and moved back to Buffalo to finish college, open his bookstore, Burning Books, and start a family.

“I’m no terrorist,” he said. “I’m an activist.”

Mr. Pickering has written books sympathetic to the liberation front, but he said his political views and past association should not make him the target of a federal investigation. “I’m just a guy who runs a bookstore and has a wife and a kid,” he said.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


“Company allegedly misled government about security clearance checks”

June 28, 2013

The Washington Post on June 27, 2013 released the following:

By Tom Hamburger and Zachary A. Goldfarb

“Federal investigators have told lawmakers they have evidence that USIS, the contractor that screened Edward Snowden for his top-secret clearance, repeatedly misled the government about the thoroughness of its background checks, according to people familiar with the matter.

The alleged transgressions are so serious that a federal watchdog indicated he plans to recommend that the Office of Personnel Management, which oversees most background checks, end ties with USIS unless it can show it is performing responsibly, the people said.

Cutting off USIS could present a major logistical quagmire for the nation’s already-jammed security clearance process. The federal government relies heavily on contractors to approve workers for some of its most sensitive jobs in defense and intelligence. Falls Church-based USIS is the largest single private provider for government background checks.

The inspector general of OPM, working with the Justice Department, is examining whether USIS failed to meet a contractual obligation that it would conduct reviews of all background checks the company performed on behalf of government agencies, the people familiar with the matter said, speaking on the condition of anonymity because the investigation has not yet been resolved.

After conducting an initial background check of a candidate for employment, USIS was required to perform a second review to make sure no important details had been missed. From 2008 through 2011, USIS allegedly skipped this second review in up to 50 percent of the cases. But it conveyed to federal officials that these reviews had, in fact, been performed.

The shortcut made it appear that USIS was more efficient than it actually was and may have triggered incentive awards for the company, the people briefed on the matter said. Investigators, who have briefed lawmakers on the allegations, think the strategy may have originated with senior executives, the people said.

Ray Howell, director of corporate communications at USIS, declined to comment on Thursday.

In a statement last week, USIS said it received a subpoena from the inspector general of OPM in January 2012. “USIS complied with that subpoena and has cooperated fully with the government’s civil investigative efforts,” the statement said. The company would not comment on the Snowden case.

It is not known whether USIS did anything improper on its 2011 background check of Snowden, the 30-year-old who leaked documents about the inner workings of the NSA and is now the subject of a global drama. He gained access to those documents after he was cleared to work at NSA contractor Booz Allen Hamilton.

Last week, Patrick E. McFarland, the inspector general of OPM, said he has concerns about Snowden’s background check. “We do believe that there may be some problems,” he said.

The broader concerns about background checks are not limited to USIS. McFarland’s office has 47 open investigations into alleged wrongdoing by individuals in the background checks industry, according to a statement from the inspector general’s office. Separately, since 2006, the watchdog has won convictions in 18 cases in which employees claimed to have verified information that ultimately turned out to be false or not even checked.

“There is an alarmingly insufficient level of oversight of the federal investigative-services program,” McFarland said last week in congressional testimony. “A lack of independent verification of the organization that conducts these important background investigations is a clear threat to national security.”

McFarland’s office declined to comment on the details of the investigation. “We have never indicated whether the case was criminal, civil, or administrative,” a statement from the office said.

Last week, Sen. Claire McCaskill (D-Mo.) said USIS is the subject of a criminal probe as a result of a “systematic failure” to conduct background checks. She did not elaborate. A spokesperson said Thursday that the senator stands by her statement.

Sen. Jon Tester (D-Mont.), who chairs a Homeland Security subcommittee, said he plans to introduce legislation within two weeks to increase oversight of the security clearance process, including giving inspectors general more power to audit funding and other aspects of the massive effort to provide 4.9 million Americans with authorized access to classified and other sensitive government information.

“I cannot believe that this is handled in such a shoddy and cavalier manner,” Tester said in an interview Thursday. “I personally believe that if you are under criminal investigation, you should be suspended from the process until it is resolved.”

Tester added: “We have spent hundreds of billions in this country trying to keep classified information classified and to keep people from outside coming in. And what we see here is that we have a problem from the inside.”

USIS, which was spun off from the federal government in the 1990s, has become the dominant player in the background checks business. It does about 45 percent of all background checks for OPM, according to congressional staffers. USIS has 7,000 employees.

USIS has been under financial pressure in recent years because of federal cutbacks and less generous contracts from the government, according to financial analysts working at Moody’s and Standard & Poor’s. The firm’s parent company, Altegrity, is owned by Providence Equity Partners, a private equity firm. USIS has two main competitors, KeyPoint Government Solutions and CACI.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

————————————————————–

To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.