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The Financial Services Roundtable Wants to Terrify You into Giving Them More Immunity

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The policy discussion about the many ways that the Cyber Information Sharing Act not only doesn’t do much to prevent the hacking of public and private networks, but in key ways will make it worse, must be making its mark. Because the Financial Services Roundtable, one of the key corporatist groups backing the bill, released this YouTube full of scary warnings but absolutely zero explanation about what CISA might do to increase cybersecurity.

Indeed, the YouTube is so context free, it doesn’t note that Susan Collins, the first person who appears in the video, has called for mandatory reporting from some sectors (notably, aviation), which is not covered in the bill and might be thwarted by the bill. Nor does it mention that the agency of the second person that appears in the video, Department of Homeland Security Secretary Jeh Johnson, has raised concerns about the complexity of the scheme set up in CISA, not to mention privacy concerns. It doesn’t note that the third person shown, House Homeland Security Chair Michael McCaul, favored an approach that more narrowly targeted the information being shared and reinforced the existing DHS structure with his committee’s bill.

Instead of that discussion … “Death, destruction, and devastation!” “Another organization being hacked!” “Costing jobs!” “One half of America affected!” “What is it going to take to do something?!?!?!”

All that fearmongering and only one mention of the phrase “information sharing,” much less a discussion of what the bill in question really does.

In August, the head of the FSR, Tim Pawlenty, was more honest about what this bill does and why his banks like it so much: because it would help to hide corporate negligence.

“If I think you’ve attacked me and I turn that information over to the government, is that going to be subject to the Freedom of Information Act?” he said, highlighting a major issue for senators concerned about privacy.

“If so, are the trial lawyers going to get it and sue my company for negligent maintenance of data or cyber defenses?” Pawlenty continued. “Are my regulators going to get it and come back and throw me in jail, or fine me or sanction me? Is the public going to have access to it? Are my competitors going to have access to it? Are they going to be able to see my proprietary cyber systems in a way that will give up competitive advantage?”

That is, the banks want to share information with the government so it can help those private corporations protect themselves (without paying for it, really, since banks do so well at dodging taxes), without any responsibility or consequences in return. “Are my regulators going to get [information about how banks got attacked] and come back and throw me in jail, or fine me, or sanction me?” the banks’ paid lobbyist worries. As the author of this bill confirmed last week, this bill will undercut regulators’ authority in case of corporate neglect.

The example of banks dodging responsibility in the past — possibly aided by a similar (albeit more rigorous) information sharing regime under the Bank Secrecy Act — provides all the evidence for how stupid this bill would be. We need corporations to start bearing liability for outright negligence. And this bill provides several ways for them to avoid such liability.

Don’t succumb to bankster inciting fear. America will be less safe if you do.

Tim Pawlenty Makes It Clear Banks Want Immunity for Negligence

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The business community is launching a big push for the Cyber Information Sharing Act over the recess, with the Chamber of Commerce pushing hard and now the Financial Services Roundtable’s Tim Pawlenty weighing in today.

Pawlenty is fairly explicit about why banks want the bill: so that if they’re attacked and share data with the government, they cannot be sued for negligent maintenance of data.

“If I think you’ve attacked me and I turn that information over to the government, is that going to be subject to the Freedom of Information Act?” he said, highlighting a major issue for senators concerned about privacy.

“If so, are the trial lawyers going to get it and sue my company for negligent maintenance of data or cyber defenses?” Pawlenty continued. “Are my regulators going to get it and come back and throw me in jail, or fine me or sanction me? Is the public going to have access to it? Are my competitors going to have access to it? Are they going to be able to see my proprietary cyber systems in a way that will give up competitive advantage?”

CISA has been poorly framed, he explained.

“It should be called the cyber teamwork bill,” Pawlenty said.

As I’ve pointed out repeatedly, what the banks would get here is far more than they get under the Bank Secrecy Act, where they get immunity for sharing data, but are required to do certain things to protect against financial crimes.

Here, banks (and other corporations, but never natural people) get immunity without having to have done a damn thing to keep their customers safe.

Which is why CISA is counterproductive for cybersecurity.

Have the Banks Escaped Criminal Prosecution because They’re Spying Surrogates?

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I’m preparing to do a series of posts on CISA, the bill passed out of SSCI this week that, unlike most of the previous attempts to use cybersecurity to justify domestic spying, may well succeed (I’ve been using OTI’s redline version which shows how SSCI simply renamed things to be able to claim they’re addressing privacy concerns).

But — particularly given Richard Burr’s office’s assurances this bill is great because “business groups like the Financial Services Roundtable and the National Cable & Telecommunications Association have already expressed their support for the bill” — I wanted to raise a question I’ve been pondering.

To what extent have banks won themselves immunity by serving as intelligence partners for the federal government?

I ask for two reasons.

First, when asked why she, along with Main Justice’s Lanny Breuer, authorized the sweetheart deal for recidivist transnational crime organization HSBC, Attorney General nominee Loretta Lynch implied that there was insufficient admissible evidence to try any individuals associated with this recidivism.

I and the dedicated career prosecutors handling the investigation carefully considered whether there was sufficient admissible evidence to prosecute an individual and whether such a prosecution otherwise would have been consistent with the principles of federal prosecution contained in the United States Attorney’s Manual.

That’s surprising given that Carl Levin managed to come up with 300-some pages of evidence. Obviously, there are several explanations for this response: she’s lying, the evidence is inadmissible because HSBC provided it willingly thereby making it unusable for prosecution, or the evidence was collected in ways that makes it inadmissible.

It’s the last one I’ve been thinking about: is it remotely conceivable that all the abundant evidence against banksters their regulators have used to obtain serial handslaps is for some reason inadmissible in a criminal proceeding?

I started thinking about that as a real possibility when PCLOB revealed that Treasury’s Office of Intelligence and Analysis has never once — not in the 30-plus years since Ronnie Reagan told them they had to — come up with minimization procedures to protect US person privacy with data collected under EO 12333. Maybe that didn’t matter so much in 1981, but since 2004, Treasury has had an ever-increasing role in using intelligence (collected from where?) to impose judgments against people with almost no due process. And those judgements are, in turn, used to impose other judgments on Americans with almost no due process.

The thing is, you’d think banks might care that Treasury wasn’t complying with Executive Branch requirements on privacy protection. Not only because they care (ha!) about their customers, whether American or not, but because many of them are, themselves, US persons. US bank US person status should limit how much Treasury diddles with bank-related intelligence, but Treasury doesn’t appear bound by that.

Which leads me to suspect, at least, that there’s something in it for the banks, something that more than makes up for the serial handslaps for sanctions violations.

And one possibility is that because of the way this data is collected and shared, it can’t be used in a trial. Voila! Bank immunity.

All that’s just a wildarsed guess.

But one made all the more pressing given that Treasury is among the Appropriate Federal Entities that will be default intelligence recipients for cyber information under CISA.

(3) APPROPRIATE FEDERAL ENTITIES.—

The term ‘‘appropriate Federal entities’’ means the following:

(A) The Department of Commerce.

(B) The Department of Defense.

(C) The Department of Energy.

(D) The Department of Homeland Security.

(E) The Department of Justice.

(F) The Department of the Treasury.

(G) The Office of the Director of National Intelligence.

To some degree, this is not in the least bit surprising. After all, financial regulators have increasingly made cybersecurity a key regulatory concern of late, so it makes sense for Treasury to be in the loop.

But banksters rarely — never! — add regulatory exposure for themselves without a fight and, as Burr’s office has made clear, the banks love this bill.

One more datapoint, back to HSBC. As I noted when Lanny Breuer and Loretta Lynch announced that handslap, Breuer neglected to mention that HSBC was getting a handslap not just for helping cartels profit off drugs, but also helping terrorists fund their activities (at the time Pete Seda was being held without bail on charges the government insisted amounted to material support for terrorists for handing a check to Chechens using cash that had come indirectly from HSBC). The actual settlement, however, made mention of it by explaining that HSBC had “assisted the Government in investigations of certain individuals suspected of money laundering and terrorist financing.” By dint of that cooperation, in other words, HSBC went from being a material supporter of terrorism to being a deputy financial cop. And Breuer expanded that notion of banks serving as deputized financial cops thereafter.

Are the methods and terms by which we’re collecting all this financial intelligence to use against some bad guys precisely what prevents us from holding the even bigger bad guys — the ones affecting far more of us directly, in the form of the houses we own, the towns we live in, the opportunity costs paid to financial crime — accountable?

And will this system now be replicated under CISA (or has it, already) as banks turn into cyber crime deputized cops?

How a Previously Qualified Elizabeth Warren became Unqualified, According to a Previously Progressive Chris Dodd

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July 27: Chris Dodd says of Elizabeth Warren, “She’s qualified, no question about that”

August 9: Katrina vanden Heuvel tweets that several sources have told her Elizabeth Warren would be nominated “next week”

August 12: Warren meets with Financial Services Roundtable President Steve Bartlett and then meets with David Axelrod at the White House to discuss the CFPB position

August 13: Robert Gibbs acknowledges that Warren had been meeting about the CFPB position, but says no announcement would be made in the next week

August 17: Chris Dodd raises questions about whether Warren can manage anything to suggest she may not be confirmable even while he admits she has “a great campaign”

“My simple question about Elizabeth is: Is she confirmable?” Dodd said during a visit Tuesday with The Courant’s Editorial Board. “It isn’t just a question of being a consumer advocate. I want to see that she can manage something, too.”

But when pressed about where he stands, Dodd said: “If the president wants to name her and it goes through the hearing process, then fine, he’ll have my support. But she has to tell me more than just she’s a good consumer advocate or that’s she’s got a great campaign.”

I guess the only question this chronology leaves is whether or not Dodd is acting at the behest of his future employers, the banks, the White House, or both.