If you bring up Bank of America, you're a sucker.

The CIA: Banking on Intelligence

Anthony L. Kimery
Covert Action Information No. 46

"The CIA has collected, and the intelligence community has collected, economic intelligence of one kind or another since its inception. — Director of Central Intelligence, R. James Woolsey

The CIA has never been above breaking the law as it battles communists, nationalists, terrorists, or the latest “national security threat”: foreign-directed economic and financial subterfuge. This growing economic focus comes at the bidding of many voices in the CIA, Pentagon, and corporate community who believe the U.S.’s primary intelligence mission should be to help industry compete in the global marketplace. There has been little public discussion, however, over just when corporate competition becomes a sufficient threat to the national security to unleash the corruptible talents of the intelligence community into the world of international finance.


“New” Intelligence Requirements: Old Practices

That line between “national security” and private financial interests has long been mutable and subject to the day-to-day needs of the CIA. For decades, the U.S. has used currency manipulations, embargoes, and other forms of economic pressure to undermine its foes. When the 1945 Bretton Woods agreement established the U.S. dollar as the international currency of the World Bank and International Monetary Fund, the U.S. secured enormous international financial leverage. It can direct intense fiscal pressure against foreign financial institutions, and even an entire national economy, by activating the global power of the Treasury Department and the Federal Reserve (along with the international financial institutions it controls). Witness the long-standing embargo against Cuba, the economic sabotage of Nicaragua in the 1980s, the illegal withholding of Panama’s canal revenues between 1987 and 1990, and the current international sanctions against Iraq. Economic motives have always driven U.S. covert operations. And bending banking regulations to the benefit of U.S. and foreign elites has been standard practice. Thus, it should be no surprise that, despite questionable legality, both the National Security Agency (NSA) and the CIA already engage in extensive economic intelligence activities wherever U.S. national security interests are perceived to be at risk.

The practice of using existing U.S. intelligence agencies to gather economic and financial data through traditional spy methods was given a boost by the Reagan administration. Incoming CIA Director William Casey’s national security credentials were matched by his business background. Casey had been chair of the Securities and Exchange Commission, Undersecretary of State for economic affairs, and Import-Export Bank President. He ordered the Agency’s once modest National Collection Division (NCD) to recruit major corporate executives abroad to gather proprietary information on foreign businesses and the trade and economic policies of foreign governments. This move made the NCD the largest information gathering program within the Agency’s operations directorate. By 1984, more than 150 corporations were providing cover for CIA people overseas.

Also on Casey’s order, from 1982 through 1987, career CIA man Douglas P. Mulholland served at the Treasury Department as the chief liaison to the Agency. The person in this position typically ensures that, should some low-level regulator stumble across banking law violations, CIA operations involving banks and other federally regulated financial institutions are not compromised. No operations, it seems, were compromised on Mulholland’s watch. He retired from the CIA in 1987 to become a researcher for George Bush’s presidential campaign, and later headed the State Department’s Bureau of Intelligence and Research.


Treasury Joins the Inner Circle

While the Reagan and Bush administrations were able to maintain the CIA’s budget in the name of anticommunism, the post-Cold War CIA has had to be more diverse. It has switched its emphasis to counterterrorism and economic intelligence.

Bill Clinton wasted no time in elevating the “new” economic agenda to the highest level. For the first time, a treasury secretary, Lloyd Bentsen, became a member of the CIA’s daily White House briefing. Previously, the briefing was reserved only for the president, the vice president, the national security adviser, and the secretaries of state and defense. This move formalized a trend put in motion by Reagan and Bush, who had already brought the Department of the Treasury’s intelligence unit and the CIA closer together.

Reagan had created a new agency at Treasury, the Financial Crimes Enforcement Network (FinCEN), with liaisons to the NSA, CIA, and the Defense Intelligence Agency (DIA). FinCEN compiles and analyzes the computerized financial disclosure data that banks are required to report to regulators under the Bank Secrecy Act and related money laundering laws. Its capabilities are staggering. For instance, when federal agents wanted to analyze patterns of cash deposits in New York City as part of a drug investigation, FinCEN’s computers quickly isolated a single cash-rich neighborhood in Manhattan. Its current director, Brian M. Bruh, is a former deputy assistant commissioner of criminal investigations at the IRS and served as chief investigator for the Tower Commission, President Reagan’s official Iran-Contra probe. Under Bruh’s leadership, FinCEN is expanding its capabilities. Los Alamos National Laboratory, on contract to FinCEN, is developing “artificial intelligence” capable of isolating specific financial activity within the millions of filings it has on computer. Though technically a law enforcement tool, this new software could easily be used to spy on virtually anybody’s personal or business financial transfers.

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