Spying on Terrorist Cash Flows: EU to Allow US Access to Bank Transaction Data

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Part 2: 'Why Does Donald Rumsfeld Want To Know About My Money?'

American intelligence services say the transfer of international banking information is vital to the war on terror. Zoom
AFP

American intelligence services say the transfer of international banking information is vital to the war on terror.

"Why does the US Secretary of Defense Donald Rumsfeld need to know when I transfer some money from Rabobank to the Sparkasse bank?" complained Luxembourg's Foreign Minister Jean Asselborn. Experts warned about the possibility of industrial espionage -- the US might pass the financial data on to the Russians or the Chinese, for example. In Germany politicians demanded answers. The head of the FDP, Guido Westerwelle, who is now Germany's foreign minister, requested an "immediate halt to the transfer of such data -- and at the very least, a suspension," as well as "measures to prevent such serious breaches of privacy in the future."

The Belgian government also saw things this way. Which is why SWIFT, whose headquarters are based near Brussels, began to build a new data center in Switzerland with a view to moving any EU-data operations out of the American center. This also means that no American pressure can be brought to bear on SWIFT in the US and the European data, which makes up over two-thirds of all SWIFT traffic, would be safer. Or so they thought.

EU Secret Services Use American-Gathered Bank Data Too

Among the grateful users of the SWIFT data that the Americans were extracting were European security agencies. The services are not actually allowed to gather this kind of information themselves. Which is why European anti-terror experts and their political representatives made a point of staying on cozy terms with their American colleagues. As European Commission Vice-President Jacques Barrot has said, trans-Atlantic cooperation in this area is "indispensable" and the data gathered had proven "absolutely useful and effective" in the fight against terrorism.

In closed sittings, Gilles de Kerckhove, the EU's counter-terrorism coordinator, warned doubters about "anti-terror apathy." The attacks in London in 2005 and Madrid in 2004 saw EU security threat levels raised to a new level and without the US's work on financial data there would be a "risky hole" with unknown consequences, de Kerckhove said.

According to a restricted report on the SWIFT surveillance operation, there have been noteworthy achievements. European security services received around 1,400 leads from the surveillance. Between January and September 2009 alone, they had over a hundred leads. Three potential terrorists were captured in Britain before they could carry out an attack which they had planned in detail, thanks to the SWIFT surveillance. These three were later sentenced to over 30 years in prison.

The SWIFT information also apparently helped in the 2007 capture of three German members of the Islamic Jihad Union, an organization believed to be based in Pakistan with close contacts to al-Qaida, the Taliban and Pakistani jihad groups. Despite such glowing praise though, no detailed proof has ever been presented about the SWIFT surveillance's alleged efficacy.

'We Will Never Be Able to Look the Americans in the Eye'

The political power play had an impact though. In July 2009, the EU's foreign ministers requested that the European Commission negotiate some sort of agreement with the Americans. They didn't want to abolish the co-operation over banking data, they just wanted to put it on a proper legal footing and to come up with some binding, mutually acceptable rules. The worry was that if this didn't happen, then the Americans would take matters into their own hands and, for example, pressure the Belgians into "volunteering" information again. Which is why the European Commission then put down on paper a provisional plan for continuing the cooperation with the Americans for the coming year. A more definite agreement could then be formulated within the 12 months that followed.

At the beginning of the latter process, there was still a lot of opposition to the deal, particularly from the FDP in Germany. Alvaro even warned of the "burial of banking secrecy." His fellow FDP party member, Leutheusser-Schnarrenberg, described the issue as a "violation" of data protection laws.

In their coalition agreement with the CDU, the FDP agreed that Berlin should not give in on the matter. And on security issues like this, all it takes is one dissenting voice within the EU to scupper a whole deal. However, over the course of this week, the FDP became quieter and quieter on the subject.

Far away in Strasbourg, where the European Parliament is currently sitting and where representatives are indignant about how various member administrations are ignoring democratic principles, a resigned Alvaro had only this conclusion to make on behalf of the Europeans.

"If we always bow to the US," he noted, "we will never be able to negotiate with them as equals."

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