Whistleblowing and Internal Monitoring/Investigations

Many thanks again to the Faculty of Law at the University of Hong Kong for hosting my presentation on “Whistleblowing & Internal Monitoring/Investigations” yesterday. It was a really interactive and responsive class. The scheduled three hours was barely enough to cover what I estimated to be an hour plus presentation thanks to all the interesting questions and my sincere apologies to the class for rushing through the latter parts of the slides.

One question at the end of the session, what’s the take-away on the topic.

With and without a poison-pen letter from a whistleblower, a pre-transaction reputation/investigative due diligence should always be conducted ahead of all other types of due diligence. This is not a biased opinion but one proven by real life experience from many past cases whereby some serious and damaging red flags on reputation issues/risks could potentially kill a transaction no matter how good the counterparties emerged in the legal, financial and other due diligence – although in some situations clients took advantage of the negative findings to re-negotiate terms for the pending transaction. Information is power!

In a post-transaction external/internal investigation especially one potentially heading to the courts, with and without a poison-pen letter, it is critical to conduct public records research first as the findings could be documented evidence legally admissible in courts that can help the lawyers and clients win the case. If the public records search turns out futile (a likely scenario in non-transparent and opaque jurisdictions), the findings from intelligence becomes pivotal.

I shared with the class an example of a typical court case whereby the client wins if we can prove two people A & B collaborated on a fraud scheme. No surprise they denied even knowing each other. A barrister once told me how he often receives surveillance photos of A & B say having coffee together as evidence – and how he can easily lose the case with such weak evidence. The best evidence is to prove the two have a long history of relationship – they attended the same school (public records), they were past business partners (public records), their companies were sued (public records), they commented on each other’s FaceBook (could be public records), etc. In the absence of any/sufficient public records evidence, findings from intelligence gathering can potentially turn into public records and important evidence. Consider:

– They not only attended the same school but same class, same computer club and even went on a school camping trip to Nepal when they were 10. The latter are findings from intelligence gathering
as they may be difficult to find in public records but the sources could provide photos as proof.

– They were in the same WhatsApp & WeChat groups? A source from the group could provide a screenshot of group members as proof.

– They were neighbors when they were young? This could be difficult to prove in public records because they don’t own the properties then but if there’s a lead they were neighbors, a search on their parents names could lead to documented proof.

Hence the importance of intelligence gathering. And thinking out of the box.

Shhh… NSA Have More Data Than They Can Handle

Are you wondering why this “problem” (data overload – see article below) did not happen earlier…?

NSA is so overwhelmed with data, it’s no longer effective, says whistleblower

Summary:One of the agency’s first whistleblowers says the NSA is taking in too much data for it to handle, which can have disastrous — if not deadly — consequences.

By Zack Whittaker for Zero Day | April 30, 2015 — 14:29 GMT (22:29 GMT+08:00)

NEW YORK — A former National Security Agency official turned whistleblower has spent almost a decade and a half in civilian life. And he says he’s still “pissed” by what he’s seen leak in the past two years.

In a lunch meeting hosted by Contrast Security founder Jeff Williams on Wednesday, William Binney, a former NSA official who spent more than three decades at the agency, said the US government’s mass surveillance programs have become so engorged with data that they are no longer effective, losing vital intelligence in the fray.

That, he said, can — and has — led to terrorist attacks succeeding.

Binney said that an analyst today can run one simple query across the NSA’s various databases, only to become immediately overloaded with information. With about four billion people — around two-thirds of the world’s population — under the NSA and partner agencies’ watchful eyes, according to his estimates, there is too much data being collected.

“That’s why they couldn’t stop the Boston bombing, or the Paris shootings, because the data was all there,” said Binney. Because the agency isn’t carefully and methodically setting its tools up for smart data collection, that leaves analysts to search for a needle in a haystack.

“The data was all there… the NSA is great at going back over it forensically for years to see what they were doing before that,” he said. “But that doesn’t stop it.”

Binney called this a “bulk data failure” — in that the NSA programs, leaked by Edward Snowden, are collecting too much for the agency to process. He said the problem runs deeper across law enforcement and other federal agencies, like the FBI, the CIA, and the Drug Enforcement Administration (DEA), which all have access to NSA intelligence.

Binney left the NSA a month after the September 11 attacks in New York City in 2001, days after controversial counter-terrorism legislation was enacted — the Patriot Act — in the wake of the attacks. Binney stands jaded by his experience leaving the shadowy eavesdropping agency, but impassioned for the job he once had. He left after a program he helped develop was scrapped three weeks prior to September 11, replaced by a system he said was more expensive and more intrusive. Snowden said he was inspired by Binney’s case, which in part inspired him to leak thousands of classified documents to journalists.

Since then, the NSA has ramped up its intelligence gathering mission to indiscriminately “collect it all.”

Binney said the NSA is today not as interested in phone records — such as who calls whom, when, and for how long. Although the Obama administration calls the program a “critical national security tool,” the agency is increasingly looking at the content of communications, as the Snowden disclosures have shown.

Binney said he estimated that a “maximum” of 72 companies were participating in the bulk records collection program — including Verizon, but said it was a drop in the ocean. He also called PRISM, the clandestine surveillance program that grabs data from nine named Silicon Valley giants, including Apple, Google, Facebook, and Microsoft, just a “minor part” of the data collection process.

“The Upstream program is where the vast bulk of the information was being collected,” said Binney, talking about how the NSA tapped undersea fiber optic cables. With help from its British counterparts at GCHQ, the NSA is able to “buffer” more than 21 petabytes a day.

Binney said the “collect it all” mantra now may be the norm, but it’s expensive and ineffective.

“If you have to collect everything, there’s an ever increasing need for more and more budget,” he said. “That means you can build your empire.”

They say you never leave the intelligence community. Once you’re a spy, you’re always a spy — it’s a job for life, with few exceptions. One of those is blowing the whistle, which he did. Since then, he has spent his retirement lobbying for change and reform in industry and in Congress.

“They’re taking away half of the constitution in secret,” said Binney. “If they want to change the constitution, there’s a way to do that — and it’s in the constitution.”

An NSA spokesperson did not immediately comment.

Edward Snowden & Hervé Falciani Knew Each Other Before Their Respective Exposé?

As it so happened, everything started and ended in Geneva…

It was a cold morning in mid-December 2008. Hervé Falciani has just finished packing his favorite black Rimowa luggage and a small handy leather bag with his five precious CDs safely tucked to the bottom.

“Mate I’m getting ready to leave for Nice for a few days, to do you know what,” he wrote on his encrypted email.

“Good luck mate. That’s the spirit. Am actually planning to get myself out of Geneva and home for good shortly after the New Year. Keep those stuff safe,” the reply promptly appeared on the computer screen.

“Will do. Thanks so much for all the guidance. Take care!” Falciani penned off, half-wishing his pal Snowden was not serious about leaving Geneva.

Well, that was probably how John le Carré approached his next best-selling spy novel but this opening scene may not be too far from the truth.

Falciani was widely dubbed the Snowden of the banking world when the HSBC exposé stole global headlines early this week. According to his profile, the then-36-year-old dual French-Italian national joined the British banking giant HSBC in 2000, in Monaco where he grew up, and was transferred to HSBC Private Bank (Suisse) in Geneva, Switzerland in 2006.

That was the same year Edward Snowden joined the CIA and the now famous whistleblower behind the NSA revelations was posted to Geneva the following year under diplomatic cover, where he admitted having grown disillusioned with American spy craft. He left Geneva and the agency in 2009.

And as an undercover CIA operative based in Geneva, Snowden probably knew some bankers as The Guardian once reported:

He described as formative an incident in which he claimed CIA operatives were attempting to recruit a Swiss banker to obtain secret banking information. Snowden said they achieved this by purposely getting the banker drunk and encouraging him to drive home in his car. When the banker was arrested for drunk driving, the undercover agent seeking to befriend him offered to help, and a bond was formed that led to successful recruitment.

The possibility that Snowden and Falciani knew each other may be a novelist’s creation and a trivial even if it’s true. But nevertheless, it would open up many possibilities.

Consider, for example, both claimed to have reported to their superiors, who ignored their respective complaints and warnings. Both became whistleblowers and accused for their actions. The two IT experts stole and released troves of internal data to the media – Falciani, the systems specialist of the HSBC Private Bank in Geneva now under the global spotlights, reportedly met French tax investigators at a cafe in Nice airport before Christmas of 2008 and handed them five CDs worth of confidential data pertaining to some 130,000 clients and 300,000 private accounts from 200 countries – which eventually reached then Finance Minister of France Christine Lagarde, who subsequently shared it with other countries.

And the rest was history as we know today.

Snowden is scheduled to speak via video-conference this Friday to the International Students For Liberty Conference in downtown Washington, D.C. Would be interesting to hear what he has to say about the HSBC exposé and… his friend Falciani.

Shhh… WikiLeaks' Cousin AfriLeaks – A New Anonymous Whistleblowing & Open Data Platform for Africa

AfriLeaks, a brand new anonymous whistleblowing platform, will be launched end November but unlike the renowned and established WikiLeaks, this African cousin will not be releasing secret information directly to the public.

“[AfriLeaks will] provide a secure tool for connectivity between the whistleblowers and the media who then investigate the substance and character of the leak,” according to Khadija Sharife of the African Network of Centers for Investigative Reporting (ANCIR) – the organization that will host the platform – in a Deutsche Welle report earlier this week

According to Deustche Welle, unlike WikiLeaks’ aim to publish and disclose information, “AfriLeaks will be there to provide leads for stories to media and research organizations. The new platform will allow whistleblowers to choose the media or research organization to which they want to send the information”.

Assange-Bio

WikiLeaks founder Julian Assange may be smiling. According to a biography (above), Assange described “going to Africa and testing my ground” in the early days of WikiLeaks where one of the very first story his whistleblowing platform broke was on Kenya – which was then fed to The Guardian who ran “The Looting of Kenya” as a front-page story. The article was subsequently picked up by the Kenyan media.

“From our point of view, the leak supported the idea that oppressed media organizations could suddenly be freed when a story that mattered to them – and which they couldn’t reveal on their own – was given legitimacy and the oxygen of international exposure first,” according to the book.

“We kept at it, kept publishing stuff that the African papers were too frightened to publish…”

Shhh… List of Celebrities & Intellectuals in Support of Snowden

More than 50 well known musicians, actors and Nobel laureates (full list below) have shown their support for Edward Snowden and other whistleblowers like WikiLeaks and they are encouraging the public, through their social media outlets, to donate to the Courage Foundation which oversees the official legal defense fund for Edward Snowden and other whistleblowers, as well as fights for whistleblower protections worldwide.

SnowdenMovie

Meanwhile, The Guardian reported that actor Joseph Gordon-Levitt (best remembered for his roles in “Lincoln,” “The Dark Knight Rises” and “Inception” – photo above) has been confirmed to play Snowden in a movie to be directed by Oliver Stone, who has won best director Oscars for “Platoon” and “Born on the Fourth of July”. Stone is also noted for his political films like “JFK”, “Nixon” and “Looking for Fidel”.

According to a press release Monday, the list of signatories in support of Snowden includes:

Udi Aloni
Pamela Anderson
Anthony Arnove
Etienne Balibar
Alexander Bard
John Perry Barlow
Radovan Baros
David Berman
Russell Brand
Victoria Brittain
Susan Buck-Morss
Eduardo L. Cadava
Calle 13
Alex Callinicos
Robbie Charter
Noam Chomsky
Scott Cleverdon
Ben Cohen
Sadie Coles
Alfonso Cuaròn
John Deathridge
Costas Douzinas
Roddy Doyle
Bella Freud
Leopold Froehlich
Terry Gilliam
Charlie Glass
Boris Groys
Michael Hardt
P J Harvey
Wang Hui
Fredric Jameson
Brewster Kahle
Hanif Kureishi
Engin Kurtay
Alex Taek-Gwang Lee
Nadir Lahiji
Kathy Lette
Ken Loach
Maria Dolores Galán López
Sarah Lucas
Mairead Maguire
Tobias Menzies
M.I.A.
W. J. T. Mitchell
Moby
Thurston Moore
Tom Morello
Viggo Mortensen
Jean-Luc Nancy
Bob Nastanovich
Antonio Negri
Brett Netson
Rebecca O’Brien
Joshua Oppenheimer
John Pilger
Alexander Roesler
Avital Ronell
Pier Aldo Rovatti
Susan Sarandon
Peter Sarsgaard
Assumpta Serna
Vaughan Smith
Ahdaf Soueif
Oliver Stone
Cenk Uygur
Yanis Varoufakis
Peter Weibel
Vivienne Westwood
Tracy Worcester
Slavoj Zizek

Shhh… Norway to Arrest Nobel-nominated Snowden

The Norwegian police should arrest NSA whistle-blower and fugitive Edward Snowden if he showed up in Norway to receive the Nobel Peace Prize this December, according to a Norwegian politician.

Norwegian Right Wing Party MP Michael Tatzschner warned that bagging the prestigious prize would in no way exempt Snowden from arrest and Norway should not make a distinction between a Nobel Peace Prize winner and any other wanted American citizen.

“Norway needs to respect the agreements that we have signed,” Tatzschener told Norway’s media Dagbladet on Tuesday, with reference to international law that, given a valid US warrant, requires Norway to arrest Snowden if he arrives in the country.

MAD-Magazine-Snowden-Flee

Snowden (shown above: Photo credit to MAD magazine) has been nominated for the Peace Prize, to be announced end of the year, amid growing global support.

He was recently granted a three-year residence permit by the Russian authorities on August 1.

But the most wanted man in the world could receive Swiss asylum if he opts to travel to Switzerland to testify against the National Security Agency, according to my previous piece earlier this week.

The Swiss Attorney General has stated that Switzerland would not extradite a US citizen if the individual’s “actions constitute a political offense, or if the request has been politically motivated”.

For Whom the Whistle Blows

That Whistle Could Have You Behind Bars

For Whom the Bell Tolls was a 1940 novel by Ernest Hemingway about an American in the International Brigades who blows up a bridge during the Spanish Civil War with death the ultimate sacrifice.

But what about For Whom The Whistle Blows? That informs the current debate about Bradley Manning and Edward Snowden, two Americans who risked their lives by leaking documents on US foreign policy and covert cyber-snooping activities during the US war on terrorism. Are they prisoners – one in a US army stockade and the other in exile in Moscow – of conscience?

In contrast to the contemptuous labels and espionage charges the US government slapped on the two, one a US Army private first class and the other a former government intelligence contractor, both claimed their motive was to spark public debate and promote greater transparency in US government conduct. Whistle-blowers in general have all along been quite rightly championed and heralded by the authorities, media and the general public – at least by those whose oxen are not being gored from the revelations. Such are the dichotomies of modern history.

You can find the entire column here and there.

Was Edward Snowden A Spy?

Or was Dick Cheney looking for a cheap excuse to play politics?

Edward Snowden with his sudden departure from Hong Kong for Moscow and eventually elsewhere, possibly a country hostile to the US, would reignite the question if he’s a spy or double agent.

But the allegations made last week by former US vice president Dick Cheney that the National Security Agency whistle-blower Edward Snowden could be a spy for China is off track, and he knows it, and are a deliberate public distraction as the Obama administration searches for scapegoats in the midst of defending the NSA surveillance programs with their one and only trump card.

Snowden left with his passport annulled, a warrant on his head plus criminal charges of espionage, theft and communicating classified intelligence to unauthorized persons.

But here is the dichotomy: While the corporate world is still coping with US regulations on better corporate governance practices, where does the notion of whistleblowing stand right now?

Please read the entire column here.