Anti-Terror Alliance

The CIA, FBI and other agencies are working together in unprecedented ways to combat terrorists around the world. when FBI Director Louis Freeh and a wave of more than 100 FBI agents poured into Yemen with much fanfare following the Oct. 12 suicide bombing attack on the USS Cole, one American official accompanying them drew little attention. A senior counterterrorism expert from the CIA was on hand to bring the agency's overseas experience and local intelligence contacts into play in the investigation. As part of a groundbreaking exchange program, the CIA official had even formerly served at FBI headquarters as an intelligence liaison in counter- terrorism operations.

"The CIA guys helped us get the lay of the land," says Dale Watson, assistant director of the FBI's Counterterrorism Division. "They steered us to the right people to talk to, told us who we needed to see and explained what might offend people in the local culture."

The joint effort wasn't entirely smooth. Considerable gnashing of teeth went on among CIA higher-ups when the FBI agents, working in an unfamiliar culture and region, soon ran afoul of their Yemeni hosts. The FBI clashed with the Yemenis over their refusal to let agents interrogate suspects directly. At one point, the agents became so upset at restrictions on their actions that the government of Yemen asked them to move from a hotel in the city of Aden to Navy ships offshore. For CIA operatives whose clandestine nature leads them to travel alone and blend in with the locals, the FBI investigation brought into focus the stark differences in culture and mission between the nation's preeminent law enforcement and intelligence agencies.

Nevertheless, FBI and CIA experts were soon working hand-in-hand to piece together evidence linking the suspects in the Cole bombing to the 1998 bombings of two American embassies in Africa that killed 258 people. At least one suspect has been linked to the organization controlled by Osama bin Laden, the most wanted terrorist in the world.

The USS Cole investigation is significant for at least two reasons. First, it illustrates how the United States is increasingly being probed for vulnerabilities by sophisticated groups who would do it harm. In December 1999, for instance, FBI and CIA counterterrorism experts thwarted another bin Laden bombing plot targeting hundreds and perhaps even thousands of Americans that was timed to coincide with millennium celebrations.

Second, the transparency and closeness of joint FBI-CIA counterterrorist operations in the Cole investigation illustrates how the nation's top intelligence, law enforcement and national security experts believe the federal government must reorganize itself to fight an even broader array of threats from terrorists, spies, computer hackers and international criminals. In fact, senior officials at the CIA, the FBI, the Defense Department and the National Security Council have worked quietly for more than a year to greatly expand the model of cooperative engagement to encompass virtually the entire national security apparatus.

After two closed briefings of the Senate Intelligence Oversight Committee last year, those officials spent the waning days of the Clinton administration putting the final touches on that effort. On Jan. 4, President Clinton issued a directive institutionalizing the reforms and creating a new counterintelligence "czar." This set of reforms, called "Counter-Intelligence 21," heralds a level of cooperation never seen before among the FBI, the CIA and the Pentagon, and will, for the first time, engage the rest of the government and the private sector as well. "CI-21," as it's known to insiders, also may force lawmakers and the American public to rethink long-accepted notions about what constitutes national security and the once-clear boundaries between domestic law en- forcement, foreign intelligence gathering and defense preparedness.

"Everyone who works this problem has quickly realized that the old paradigm of threats to U.S. national security-hostile nations and their intelligence services-is far too narrow a definition in the post-Cold War era. There are countless potential bad guys capable of doing us significant harm," says John MacGaffin, a former CIA operative and FBI consultant who spearheaded the "CI-21" effort. "We also discovered this terrible disconnect where there is simply no meaningful dialogue between the policy-makers and those of us tasked with protecting our national security. Because the policy community has not defined or prioritized the 'crown jewels' of American prosperity and national security, we in the intelligence community cannot tell if those assets are being threatened or adequately protected."

A Growing Menace

Ironically, most Americans still perceive the United States as a nation at peace abroad and prosperous and secure at home. A globe-spanning U.S. military helps keep the lid on foreign conflicts, and no rival superpower has emerged. Despite recent sluggishness, the U.S. economy is the envy of the world.

Yet lawmakers and intelligence experts who peer into the clandestine closets that lie behind that sunny facade are increasingly worried. They are reminded of the terrorist bombings in which Americans were targeted at the World Trade Center in New York City in 1993, the Murrah Federal Office Building in Oklahoma City in 1995, the Khobar Towers complex in Saudi Arabia in 1996, the U.S. embassies in Tanzania and Kenya in 1998 and the USS Cole just last year. They're aware of how narrowly the United States averted similar bombings during millennium celebrations in January 2000. They've seen classified intelligence showing that numerous terrorist organizations, including the loose network linked to Osama bin Laden, are now actively seeking chemical, biological, radiological and nuclear weapons, all of terrible lethality.

Nor is it difficult to detect a malevolent, if unseen, hand behind "Moonlight Maze," a massive cyberattack on the U.S. computer networks associated with defense and national security that was first detected in 1998, and which the FBI has traced back to Russia. The experts also know that the eyes and ears of the U.S. intelligence community went dead in January 1999 when computers at the National Security Agency crashed unexpectedly. They know the details behind what many consider the botched counterintelligence investigation of Wen Ho Lee at Los Alamos National Laboratory, and Chinese acquisition of U.S. nuclear warhead designs. They ponder the unexplained disappearance of top-secret computer data at Los Alamos and the State Department last year. They haven't forgotten that unknown accomplices of accused Russian spy Stanislav Gusev, who was expelled from the United States in December 1999, were able to implant a secret listening device in the wall of a supposedly secure State Department conference room near the office of the Secretary of State. Indeed, it is becoming increasingly clear to national security and intelligence experts that the same forces that have propelled the United States to predominance over the past decade have also created new vulnerabilities and the potential for catastrophic backlash. The end of the Cold War eliminated America's only superpower rival, but it also unleashed seething ethnic and religious tensions around the world. The unchallenged conventional superiority and assertiveness of the U.S. military-demonstrated in places such as Iraq and Kosovo-also have created festering resentments around the world. The ever-more rapid movement of information, products and people in an increasingly global economy has blurred international borders and erased natural barriers that long-protected the U.S. homeland, giving both traditional and new adversaries fresh opportunities to target U.S. interests with a vast array of new tactics and weapons.

Last year, CIA Director George Tenet described the national security environment this way: "Technology has enabled, driven or magnified the threat to us . . . age-old resentments threaten to spill over into open violence, and . . . a growing perception of our so-called 'hegemony' has become a lightning rod for the disaffected."

Sounding the Alarm

Heeding such warnings, a number of congressional committees and independent reviews have strongly criticized the federal government for failing to adequately adapt to rapidly changing threats. Increasingly, members of oversight committees on Capitol Hill are taking the view that federal responsibility in critical areas such as counterintelligence and counterterrorism is divided azmong a hodgepodge of agencies lacking central direction and full accountability.

In this view, law enforcement, defense and intelligence agencies too often seem more interested in defending their turf than coordinating their efforts and sharing intelligence. These agencies also are being faulted for not keeping pace with the technological sophistication of potential adversaries. A congressionally mandated report by the National Commission on Terrorism released last June warned that national security policies were "seriously deficient," specifically faulting both the CIA and the FBI for being overly risk-averse. "In many areas, the federal government is stymied by bureaucratic and cultural obstacles to the quick and broad collection of important intelligence," says L. Paul Bremer III, a former career diplomat who chaired the commission.

Virginia Gov. James Gilmore, chairman of a congressional advisory panel formed to assess the domestic implications of a terrorist attack involving weapons of mass destruction, recently joined the fray, faulting the lack of a single focal point to coordinate counterterrorist efforts. The Senate Appropriations Committee, citing the FBI's lack of adequate focus on new threats to American security, last year approved $23 million to fund a new domestic counter-terrorism "czar" at the highest levels of the Justice Department. But the Clinton administration opposed the idea, and it was put on hold. Last summer, the House overwhelmingly passed a bill that would have created a six-person Council of Terrorism Preparedness, chaired by the President, to eliminate bureaucratic confusion and wasteful overlap in preparing the nation against terrorist attack.

Meanwhile, the House Intelligence Committee recently released its own scathing assessment of the intelligence community, faulting it for poor organization and calling for a more "corporate" approach to intelligence-gathering that would include all intelligence and national security agencies. Furthermore, the commit-tee's report said, the United States is "placing undue risk on its armed forces and national security interests by failing to remedy the many crucial problems facing the intelligence community."

Intelligence Reform

Members of the Clinton administration note that much has already been done to combat emerging and unconventional threats. In 1998, for instance, the Justice Department and the FBI created an intra-agency National Defense Preparedness Office to coordinate government efforts to prepare for terrorist incidents involving weapons of mass destruction. In addition, the FBI's new National Infrastructure Protection Center is intended to direct efforts to protect both government and private sector computer networks from cyberattacks. The National Security Agency recently announced "Project Trailblazer," an initiative to develop a "signals intelligence" system to crack new encryption software, hard-to-tap fiber optic cables and cell phone transmissions.

Meanwhile, the FBI's focus on counterintelligence and counterterrorism operations has led to an almost fivefold increase in FBI intelligence officers in the past eight years, from 224 in 1992 to more than 1,000 today. A corresponding but classified increase has been made in FBI field agents, who have been assigned to fighting spies and terrorists, according to a Syracuse University research center report. In 2001, the government is slated to spend $11.4 billion to combat terrorism and protect critical infrastructure, according to the Center for Strategic and International Studies, a Washington think tank.

What is lacking, say national security experts, is a central strategy and focused leadership to make sense of all the new threats and to coordinate an overall response. The CI-21 initiative addresses that issue by creating a National Counterintelligence Executive with independent resources and a staff to act as the leader of antiterrorist activities and serve as a conduit between policy-makers, lawmakers and private industry on the one hand, and the intelligence, law enforcement and defense communities on the other. This czar will be appointed by, and answer to, a National Counterintelligence Board of Directors consisting of the FBI director, the deputy director of the CIA, the deputy secretary of Defense and a senior official from the Justice Department. He or she will coordinate closely with a senior deputies committee, under the National Security Council, with members drawn from across relevant government agencies. The key responsibility of the czar will be to develop a national counterintelligence strategy identifying and prioritizing the keys to American prosperity and security. Informed by such a strategic analysis, the czar will then coordinate the efforts of the intelligence, defense and law enforcement communities.

Rather than representing revolutionary change, however, CI-21 significantly advances an evolution that began in the mid-1990s when the CIA and FBI were forced by circumstances to begin abandoning their long rivalry and history of animosity. "CI-21 is a manifestation of a process that began five or six years ago, when we all began to realize that the threats to U.S. security were changing in a way that our traditional organizations and structures couldn't match," says MacGaffin. "Globalization and technology were lowering traditional boundaries between what constitutes an international or domestic threat, and terrorists, drug cartels, spies and hackers were all leaping those boundaries with impunity."

The CIA and the FBI began to realize in the mid-1990s that their missions overlapped significantly. "Is counterterrorism a law enforcement or an intelligence mission? The answer is 'yes,' " says MacGaffin. "That doesn't mean spies should get involved in law enforcement, or FBI agents in spying. It does mean that both agencies [have] to increasingly start leveraging one another."

As is often the case in government reform, however, a nearly catastrophic event was required to blast through the cultural and bureaucratic barriers between the CIA and the FBI. To understand the driving force behind the CI-21 initiative, it is important first to recall the traumatic events involving the arrest of former high-ranking CIA operative and Russian mole Aldrich Ames.

Battling Bureaucracies

Many intelligence professionals still remember where they were on Feb. 21, 1994, when FBI agents pulled over the Jaguar driven by Ames and arrested the senior CIA operative. As the counter- intelligence branch chief in the CIA's Soviet Division, Ames had acted as a Soviet mole inside the CIA for eight years, selling Moscow the names of every important Soviet military and intelligence officer secretly working for the United States. Ten of these sources were executed by the Soviets based on Ames' information, and were replaced with double agents who, for many years, passed false information to the CIA that severely distorted Soviet capabilities and intentions.

The Ames case was the most profound and devastating intelligence failure in CIA history. Nearly as shocking as the scope of Ames' betrayal was the fact that it had continued for six years after Ames first drew suspicion for his grand style of living and well-known drinking binges. During that time, senior CIA officials steadfastly refused to believe, even in the light of growing evidence, that one of their own senior officials could be working for the Soviet Union. CIA officials thus resisted sharing their concerns or asking for help from FBI counterespionage experts. "For a very long time, the CIA and FBI had found ways to talk past each other and refuse to cooperate with one another. We had built cities on separate hills, and that wasn't very smart," says James Pavitt, deputy director of operations for the CIA. "The dramatic events surrounding the Ames investigation helped us recognize how much was to be gained by cooperating with the FBI, but it meant overcoming decades of mistrust." In some ways, the end of the Cold War only exacerbated FBI-CIA tensions. In the early 1990s, FBI Director Louis Freeh decided to expand the agency's presence in Moscow and other overseas capitals to better work with local police in fighting increasingly powerful criminal cartels. Then-CIA Director James Woolsey was reportedly furious. According to a knowledgeable CIA official, "It got so bad at one point that [former National Security Adviser] Anthony Lake called Freeh and Woolsey into his White House office in an effort to make peace between them, and one of the first things out of Woolsey's mouth was, "But Louis, you don't understand! Russia is mine!'"

The scope of the Ames scandal, however, irrevocably changed the relationship between the two agencies. "The fallout from the Ames case was the key catalyst to change. It became our Tailhook scandal, because afterwards nobody could argue against reform," says a senior CIA counterintelligence expert.

With Congress demanding reform, then-National Security Council official George Tenet in 1994 penned Presidential Decision Directive 24, instituting a series of post-Ames reforms. PDD-24 placed a senior FBI official in charge of counterespionage inside CIA headquarters and created a National Counterintelligence Policy Board made up of senior officials at the FBI, CIA, National Security Council and other agencies. It also established a National Counterintelligence Center at the CIA run by an FBI official. But officials at the center were denied access to the most sensitive intelligence data. When Tenet moved to the CIA, he helped ensure that not only the letter but also the spirit of the post-Ames reforms were embraced.

"I think the Ames case was the jumping-off point in taking cooperation between the FBI and CIA seriously, because it proved that we could no longer tolerate petty bureaucratic jealousy and turf wars in dealing with threats to American security," says Tenet. "We wanted people to understand that [when] it came to dealing with these transnational threats, the fortunes and efforts of both agencies would rise and fall together."

Counterterrorism Prototype

To keep the ardor for cooperation from dimming as the Ames scandal subsided, former CIA Director John Deutch and FBI Director Freeh instituted a series of regular meetings that became known as the "Gang of Eight" sessions. Led on the CIA side by then-deputy director Tenet, and including on the FBI side then-Deputy Director for National Security Robert "Bear" Bryant, the Gang of Eight explored new avenues of cooperation between the two agencies, reporting once a month to the agency directors. Before long, the Gang of Eight became the strongest proponents within the FBI and the CIA for an entirely new relationship between the agencies. Their goal was to respect the significant legal and statutory distinctions between law enforcement and espionage, but eliminate the arms-length attitude that had severely hamstrung cooperative FBI and CIA efforts in the past.

Nevertheless, support for FBI-CIA cooperation was slow to spread. For example, a plan to swap deputy directors at the agencies' respective counterterrorism centers was greeted with so much internal skepticism that, inside the agencies, it was informally known as the "hostage exchange program." When FBI agent Dale Watson received a call from Bryant asking him to consider taking a job as the deputy chief of the CIA's Counterterrorism Center, he didn't think long before saying he wasn't interested.

"I basically told him that I didn't know or like those people [at the CIA], and that I liked my current job just fine," says Watson, now the assistant director in charge of the FBI's Counterterrorism Division. Watson also knew that such out-of-agency assignments were notorious for stalling careers at the FBI. Bryant assured him that the rules were changing, however. And the next time he called Watson about the CIA job, he wasn't asking, but telling him to take it. "And without a doubt, that time at the CIA turned into one of the best assignments I ever had," says Watson. "While [there] was a steep learning curve at first, and [while] I encountered pockets of resistance to my being there, we all began to see the tremendous value to both agencies of that kind of cross-pollination and transparency in terms of our counterterrorism operations." Both sides had reason to worry about the level of cooperation required by the new approach to counterterrorism. CIA officials were concerned that sensitive intelligence would find its way into open court proceedings, compromising the agency's sacrosanct sources and methods. Closer coordination with the FBI would also undoubtedly attract the attention of civil libertarians concerned that the CIA was crossing the line that bars the agency from spying on Americans. For their part, FBI officials worried that closer cooperation would taint them overseas with the CIA's reputation for cutting legal corners and cloak-and-dagger shenanigans. What neither side could deny, however, was the obvious synergy of the counterterrorism partnership. The FBI gained insight not only into the CIA's vast overseas network, but also into the operations of friendly intelligence services that often secretly cooperated with the CIA. The CIA gained a partner that could use sensitive intelligence to head off planned terrorist attacks on U.S. soil.

"In working with the FBI, we found ways to ensure that the intelligence we gathered was used by those who need it most," says one senior CIA official. "And what has made the cooperation so successful is the FBI's ability to set up chains of custody and other means to make sure they gather needed evidence in a way that doesn't put our sources at risk." In recent years, the fingerprints of both the FBI and the CIA have ended up on a number of high-profile counterterrorism cases. In one of the most sensational examples, FBI and CIA agents in 1997 tracked down and, after a daring raid in Pakistan, snatched Mir Aimal Kansi, the gunman who in 1993 killed two CIA officials in an attack outside the main gate at CIA headquarters in Langley, Va. In the celebration at Langley following the operation, CIA officials noted approvingly that some of the loudest cheers came from the FBI agents involved.

CIA and FBI cooperation was also critical to the successful apprehension and prosecution of those involved in the 1993 World Trade Center bombing; in the 1993 apprehension of Omar Mohammed Ali Rezaq for hijacking an Egypt Air flight in which 58 people died; in the 1998 arrest of Mohammed Rashid for the 1982 bombing of a Pan Am flight; and in the 1996 apprehension of Tsutomu Shirosaki for a rocket attack against the U.S. embassy in Jakarta, Indonesia.

The FBI's Watson also credits close FBI and CIA collaboration in the investigation into the 1998 bombings of U.S. embassies in Kenya and Tanzania, which quickly traced the attacks back to the terrorist network of Osama bin Laden. Within 21 days of the bombings, the first perpetrators were behind bars. Since July 1998, FBI-CIA counterterrorism operations have apprehended and prosecuted more than two dozen terrorists, more than half of them associates of bin Laden's organization.

Bin Laden is also thought to be tied to the USS Cole bombing and the Y2K terrorist operation, which FBI and CIA officials consider perhaps the most successful preemptive counterterrorism operation to date. First alerted to the planned attacks in September 1999, both agencies cooperated with foreign intelligence and police services to disrupt terrorist cells in eight countries, with arrests made in the United States, Jordan, Pakistan and Canada.

"I can guarantee you that the millennium operation was an example where the cooperative counterterrorism system now in place was directly responsible for saving hundreds, and possibly even thousands, of American lives," says a senior CIA counterterrorism expert. "Several tons of explosives were confiscated, as were well-designed plans with specific targets identified to kill the maximum number of Americans in as bloody and high-profile fashion as possible for the sake of the CNN cameras. This was an operation designed to shock the United States away from its geopolitical goals in the Middle East."

Not everyone is sanguine, however, about the new spirit of cooperation between law enforcement and intelligence agencies. While CIA agents are still barred from spying on Americans and engaging in domestic intelligence-gathering, some watchdog groups are concerned about the blurring of traditional barriers between the CIA and the FBI. Some of those firewalls were put in place in the mid-1970s after a congressional investigation found that the CIA had spied on political dissidents in the United States.

"I don't think you can point to any terrible scandal that has resulted from the closer cooperation between the FBI and CIA, but the once-clear division of labor between them is beginning to blur in the realms of counterintelligence, counterterrorism and counternarcotics. That raises some yellow flags," says John Pike, a defense analyst at the Federation of American Scientists, an independent watchdog group in Washington. "The two agencies work under very different sets of principles. Essentially, the FBI is constrained by constitutional protections and dedicated to gathering evidence and enforcing the law. The CIA specializes in stealing secrets, skirting the law and not getting caught. If they're going to cooperate more, someone needs to pay very careful attention that those distinctions in how they operate don't get blurred as well."

A Counterintelligence Czar

Events of the past few years, however, are clearly pushing the intelligence, law enforcement and national security communities to work together. The 1998 Moonlight Maze cyberattack, during which intruders traced back to Moscow invaded hundreds of unclassified but essential computers used by the Pentagon, NASA, the Energy Department and several universities, was one such incident. "It was as if the Russians were coming into the Pentagon every night and measuring the curtains in all the offices, and we did not know why or if anything of importance was taken," says a knowledgeable intelligence official.

John Hamre, who was deputy Defense Secretary at the time and who now heads the Center for Strategic and International Studies, says, "Moonlight Maze did help convince me that we needed a new structure that would allow the national security community to coordinate and work together better, because I was confronted by a problem that I lacked the legal authority to fix on my own." The Defense Department is barred from conducting surveillance or investigations of civilians inside U.S. borders, he notes, while the law enforcement community lacks many of the tools to investigate outside the United States. "These borders of responsibility are deeply embedded in American government, yet they are increasingly irrelevant in a more globalized, interconnected world," says Hamre. "Essentially, Counter-Intelligence 21 is an effort to bridge those internal divides in government in a way that protects Americans from the bad guys while still ensuring their constitutional rights. That's why I made signing off on CI-21 literally my last act as deputy secretary of Defense."

Not everyone initially embraced the reforms embodied in CI-21. Former Attorney General Janet Reno delayed its adoption for months, apparently over concerns that it might dilute the FBI's primacy in terms of counterespionage operations and raise civil liberties issues. Reno reportedly dropped her objections after being assured that the FBI would still be responsible for leading counterespionage operations. CI-21 also clearly states that the new counterintelligence executive-who will be deeply involved in the most sensitive matters of national security-will have only an advisory function without operational responsibilities. The czar's authority will derive from the support of the heads of the FBI, the CIA and the Defense Department. His or her staff will replace the National Counterintelligence Center at CIA headquarters.

Because it establishes a powerful new position overseeing all of the elements of national and economic security across the entire government, CI-21 also met with some initial bureaucratic resistance from those currently holding responsibility for individual agency programs. Under congressional pressure, and with the support of the senior leadership of the CIA, the FBI and Defense, as well as the national security adviser, those objections were ironed out late last year, before Clinton issued a presidential directive institutionalizing the reforms in early January. CI-21's proponents, however, are worried that the reforms may become diluted or fall between the cracks now that some of its key supporters have left office. "The CI-21 reforms are at a critical crossroads because many of the events and people that helped create them are now history," says MacGaffin. "During the transition to a new administration, people are also distracted by other issues. . . . The key will be the appointment of a very senior person of stature, because the counterintelligence executive will have to be a substan- tive and knowledgeable leader who can interact at the Cabinet level."

Though his or her fingerprints will rarely be evident to the public, the counterintelligence czar will be an important figure in Washington, an executive ultimately judged on the ability to anticipate and preempt the many new threats to U.S. national security.

"The general premise behind CI-21 is to try and determine what are America's true equities, and then to extend this interagency cooperation in a systematic way to try and better protect those assets and deter acts of espionage that target them," says Tenet. "We can no longer afford to focus our counterintelligence efforts only after an incident has sparked a full criminal case, because at that point it's too late. The damage has been done."

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