Judge gives go-ahead to lawsuit against Bush's bank transfer spying program


Michael Roston
Published: Tuesday June 19, 2007

A federal judge in Chicago last week rejected a motion to dismiss a lawsuit filed against a Belgium-based bank transfer clearinghouse that collaborated with an anti-terrorism spying program led by the US Department of Treasury. The judge's decision will allow two plaintiffs to press their case that the Society for Worldwide Interbank Financial Telecommunication (SWIFT) violated the Fourth Amendment and financial privacy rights of bank customers throughout the United States when it collaborated with president George W. Bush's so-called 'Terrorist Finance Tracking Program.'

"I don't think any corporate entity should be given a blank check to spy on Americans whether it's their telephone conversations or their financial transactions," said Steven Schwarz, the lead attorney for the case's two plaintiffs, in a Tuesday morning phone call with RAW STORY. "Maybe that's how they do it in other countries, but we have one set of rules, and nobody gets carte blanche to shred the Constitution."

SWIFT facilitates $6 trillion a day in financial transactions among thousands of banks in hundreds of countries. In June 26, 2006, articles in the New York Times, Los Angeles Times, and Wall Street Journal, SWIFT was revealed by the media to have turned over considerable information its database to the US Department of Treasury. Schwarz alleged that the government initially had filed a more limited subpoena for information.

(Note: Counterterrorism expert Victor Comras wrote just after the revelation that the US government's monitoring of SWIFT transactions first was noted in 2002 in United Nations publications.)

Schwarz explained to RAW STORY why the action undertaken by SWIFT in assisting the government's program allowed an alarming fishing expedition to take place.

"You can think of SWIFT as gatekeeper, like if they have the keys to a warehouse," he said. "The government wants to get in and take a lot of specific items in there. SWIFT says 'Sorry, it's too hard to show you around, and give you this or that, why don't you just take a look around and take whatever you want.'"

James F. Holderman, the Chief Judge in the Federal Court for the Northern District of Illinois, agreed with Schwarz's argument that SWIFT appeared to have carried out an overbroad surrender of information to the US government.

"Unfettered government access to the bank records of private citizens [is] constitutionally problematic," the judge wrote in his decision, in which he allowed two of the four complaints to continue to be considered.

The banking cooperative defended itself in a statement released to Bloomberg News last week.

"SWIFT complies with lawful obligations in the countries where it operates and will vigorously defend itself against the plaintiffs' remaining allegations," said a spokesman in the article written by Andrew Harris.

Another attorney working on the case, Carl Mayer, warned that the banking consortium has great deal at stake in the case.

"SWIFT faces billions in damages after this week’s ruling," he said in a statement released to the press by the plaintiffs. "Federal bank privacy laws provide for $100 in damages for each illegal disclosure of customer records."

While agreeing that the government's financial spying program was most alarming to large, offshore institutional investors, Schwarz argued that his plaintiffs were not billionaires and all Americans should be worried about the financial privacy implications of the Terrorist Finance Tracking Program.

"Our plaintiffs are average Americans with checking accounts and credit cards," he said of Ian Walker and Stephen Kruse, who were named in the suit. "We're alleging that basic routine transactions were vacuumed up in a big data mining program. Some people may be fine with it because they think it may help catch a terrorist, but I think just as many people are uncomfortable with having their records sifted through in that manner."

Judge Holderman approved a 'change of venue' request by SWIFT to move the case to the federal district court in Virginia. If Schwarz's case holds up in the new district court, which is known for being more conservative and pro-government in its orientation, he said he'll begin his discovery process about three months from now.