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May 1, 2003
 
Homeland Security Subcommitee Hearing: Statement of Director Ralph Basham

Chairman Cochran, Senator Byrd, and distinguished members of this subcommittee, it is a privilege to be here today to testify on the Fiscal Year 2004 budget. Our agency looks forward to forming a strong and lasting relationship with this new subcommittee, and I deeply appreciate the opportunity to represent the 6,100 dedicated men and women of the Secret Service.

Let me begin by expressing my gratitude to the Members and staff of the former Subcommittee on Treasury and General Government. For years, this subcommittee was responsible for the oversight of the Secret Service, and we were tremendously fortunate to have a long line of exceptional chairmen, Senators and staff -- many of whom are here today -- that provided unwavering support to our agency, our mission and our personnel. The contribution of these individuals to the strength and versatility of the Secret Service today cannot be overstated, and we are grateful for their efforts and leadership. With me today, Mr. Chairman, are C. Danny Spriggs, Deputy Director; Barbara Riggs, Chief of Staff; Paul D. Irving, Assistant Director for Homeland Security; Stephen T. Colo, Assistant Director for Administration; Keith L. Prewitt, Assistant Director for Government and Public Affairs; Patrick C. Miller, Assistant Director for Human Resources and Training; Brian K. Nagel, Assistant Director for Inspection; George D. Rogers, Assistant Director for Investigations; Donald A. Flynn, Assistant Director for Protective Operations; Carl J. Truscott, Assistant Director for Protective Research; and John J. Kelleher, Chief Counsel.

We come before you today during what is truly a momentous period for the Secret Service. For the first time in the 138 years of our existence, the Secret Service is no longer a part of the Department of the Treasury. On March 1, 2003, pursuant to the Homeland Security Act of 2002, our agency, and all of its functions and assets, were transferred to the new Department of Homeland Security. I would like to share with the subcommittee our vision for the future of the Secret Service, and in particular, the role our agency will seek to carry out in the new department, under the leadership of Secretary Ridge. This is a time of great transition and change for the Secret Service. But we recognize the magnitude of the challenge before us, and the men and women of the Secret Service stand ready to continue their extraordinary service to our country.

The bedrock principle of the Secret Service’s dual protective and investigative missions is our focus on prevention. This core philosophy is prevalent throughout our agency’s history. The theme of prevention is ingrained in our culture and pierces every facet of the Secret Service. It is the undercurrent of our daily investigative and protective work, and is truly what makes the Secret Service unique among all law enforcement entities.

Our focus on prevention began with our original mandate to suppress counterfeiting, when the Secret Service adopted the goal of preventing the production of counterfeit currency before it was circulated. One hundred thirty-eight years later, our field personnel continue to work closely with paper and ink manufacturers and suppliers to determine if there is any inordinate demand for the materials used to produce quality counterfeit currency.

Prevention has also become an integral part of our efforts today to work with local law enforcement, other federal agencies, and the private sector to protect our country’s critical infrastructure and financial payment systems from intrusion and compromise.

Our agents are trained to detect incidents before they occur through meticulous advance work and countersurveillance tactics. Threat assessments developed by our Intelligence Division identify existing dangers to the officials we are protecting. Our Technical Security Division analyzes and addresses any vulnerabilities in a physical security plan. Our Electronic Crime Task Forces provide training to hundreds of our local law enforcement and private sector partners, aiding them in efforts to shield critical systems and networks from cyber criminals and terrorists.

We believe that our prevention-based core philosophy mirrors that of the new department. Like our agency, the DHS must be prepared to respond to incidents and infiltration. Our common goal is to anticipate and prepare, to take the necessary steps and precautions to minimize opportunities for our adversaries, and to prevent any loss of life or the destruction or disruption of the institutions we depend on.

Following enactment of this historic reorganization legislation, the Secret Service began the process of identifying resources, assets and personnel that could enhance the efforts of the new department to achieve its homeland security objectives.

Foremost is our century-old protective mission and mandate to protect the President, the Vice President, their families, former Presidents and other key government officials, including visiting world leaders and heads of state. The Secret Service is also responsible for coordinating security at National Special Security Events, such as the 2002 Winter Olympics and the national political conventions. An equally important component of homeland security is economic security, including the protection of our currency, critical assets and financial payment systems. Since our inception 138 years ago, the goal of the Secret Service’s investigative efforts has been to safeguard our financial infrastructure. Financial crimes have increasingly targeted both American industry and American consumers, as fraudulent credit and debit cards and counterfeit checks have become more prevalent in the marketplace. Even more troubling, stolen identities, false identification documents, and fraudulent credit cards have become the tools of the 21st century terrorist. Our currency and financial payment systems are primary targets for terrorists and other criminal enterprises, yet our critical infrastructure is equally vulnerable. A serious compromise of these assets, ranging from telecommunications networks to energy plants to water treatment facilities, could wreak havoc on our economy, law enforcement, military, health care providers, transportation systems, and emergency services. Accordingly, Secretary Ridge has made critical infrastructure protection one of the highest priorities of the Department of Homeland Security.

The need to secure our critical infrastructure typifies an area where our agency’s unique competencies and experience can enhance the efforts of the new department. Today, the Secret Service is already discussing with DHS officials how our expertise can be applied to safeguarding and ensuring the continuity and reliability of physical and technology-based assets throughout our economy and our communities. Reflective of the evolving nature of our mission, critical infrastructure protection has become a vital component of our protective methodology in recent years. Advances in technology and the world’s reliance on interdependent network systems have demonstrated that we can no longer rely solely on human resources and physical barriers in designing a security plan; we must also address the role and inherent vulnerabilities of critical infrastructures upon which security plans are built. That is why the Secret Service has specialists, stationed in our field offices across the country, who have the experience and expertise to secure critical infrastructures that encompass information technology, telecommunications, emergency services, and other essential networks. Over time, these skilled personnel in our field offices have built partnerships with the municipalities, private companies, and local law enforcement agencies in the cities and regions we serve. On subjects ranging from physical security to threat assessment to forensic analysis, the Secret Service endeavors to share with our local law enforcement and private industry partners the prevention-based expertise we have developed during the course of our protective and investigative missions. This is clearly evident in the area of critical infrastructure protection and our efforts to aid local governments and private companies in assessing the vulnerabilities of their networks to prevent disruption and compromise. It is also reflected in our affiliation with Carnegie Mellon’s Computer Emergency Response Team Coordination Center which focuses on insiders who attack critical information systems.

Within the Department of Homeland Security, the Secret Service is currently assisting the Directorate of Information Analysis and Infrastructure Protection with its mandate to complete vulnerability assessments of identified assets and to develop a comprehensive plan for securing key resources and critical infrastructure, including power production and distribution systems, electronic and financial transmission systems, emergency communications systems, and physical and technical networks that support such systems. We continue to work closely with the Department and are discussing options for further expanding the role of the Secret Service in safeguarding these critical assets.

Mr. Chairman, it has been more than three decades since I began my own Secret Service training. As you can imagine, much has changed for the Secret Service during that time. The technology revolution has forever transformed our economy, our culture, and the challenges we face in law enforcement. Our protective methodologies have become vastly more sophisticated, incorporating elements such as electronic surveillance, biometrics, airspace surveillance systems, and chemical/biological/hazardous material detectors. And, of course, we have the ominous and immediate threat posed by global terrorists, who have demonstrated their zeal to destroy our most cherished symbols and institutions and to harm an infinite number of Americans.

During my initial weeks as Director, I have spent considerable time introducing myself to our employees, both here in Washington and in our field offices. And as I have had the opportunity to reacquaint myself with the men and women of this agency and learn more about their backgrounds, their training, and their experience, I am reminded of the adage that the more things change, the more they stay the same.

If there has been a common thread throughout the 138 years of the Secret Service’s history, it is the truly unique caliber of individuals who are drawn to our agency. We have always managed to attract individuals with special backgrounds and extraordinary credentials.

They join the Secret Service, and remain with our agency, because their position offers something that the private sector cannot – an opportunity to serve their country. An opportunity to protect their nation’s highest elected leaders. An opportunity to protect their families, their friends, and their communities.

For these men and women, it is more than an opportunity. It is a calling.

The Secret Service is a family. Every special agent, uniformed officer, technical specialist, forensic examiner and administrative staff member contributes to our protective and investigative missions. Our employees represent a diversity of backgrounds, experiences and expertise, yet they share many ideals and aspirations. The character and spirit of our people is the undeniable strength of the Secret Service, and defines both the history and the future of our agency.

FISCAL YEAR 2004 APPROPRIATION REQUEST

The Service's FY 2004 funding request totals $1,123,951,000 and 6,066 full-time equivalents (FTE), and includes funding for two accounts: the Operating Expenses account, and the Capital Acquisitions account. Operating Expenses

The Secret Service's Operating Expenses appropriation request for FY 2004 totals $1,120,372,000 and 6,066 FTE, a decrease of 45 FTE from this fiscal year’s staffing level. The funding increases proposed in this budget include: $ 54,056,000 needed to maintain current program performance levels, and cover base pay and benefits annualization costs; an additional $31,881,000 for the protective effort surrounding the 2004 presidential campaign, and $33,000,000 for processing of mail going to the White House. These increases are offset by a $9,000,000 reduction in the base budget reflective of our reorganization into the Department of Homeland Security, and anticipated consolidation savings from integration with Department-wide processes and operations.

Capital Acquisitions

The Secret Service's FY 2004 request for its Capital Acquisitions account totals $3,579,000, an increase of $83,000 over the level appropriated for this fiscal year. This increase is needed to maintain current program performance levels. There are no programmatic changes or initiatives proposed for this account.

INVESTIGATIVE PROGRAM

Since 1865, the Secret Service has been safeguarding our currency and financial infrastructure, pre-dating our mission to protect the President by nearly four decades. Securing our financial and critical infrastructures and ensuring the strength and stability of our economy, are central tenets of homeland security. Our investigative mission is accomplished through our vast network of field offices, including 134 throughout the United States and 20 additional offices overseas. Our field offices have developed strong, information-sharing partnerships with the multitude of local police organizations and private companies they work with on a daily basis. These field offices are leading criminal investigations and task force initiatives, but they are also resources for the communities they are serving.

Computer Crime

For the last twenty years, the Secret Service has been a leader of federal law enforcement efforts to investigate electronic crimes -- an authority that was reaffirmed by Congress in the USA Patriot Act of 2001. As with our protective mission, we continue to focus on preventative measures to shield the American people and our essential networks from terrorists, cyber criminals, and other attackers. We have committed ourselves as an agency to developing new tools to combat the growth of cyber terrorism, financial crime and computer fraud.

The Secret Service’s highly-regarded Electronic Crimes Special Agent Program (ECSAP) provides specialized training to select agents in all areas of electronic crimes, and qualifies these personnel as experts in the forensic examination and preservation of electronic evidence and in the protection of critical infrastructure. ECSAP agents are also trained to examine the variety of devices used in many criminal enterprises, including credit card generators, electronic organizers, scanners, computer hard drives, and devices manufactured or reconfigured to intercept or duplicate telecommunications services.

The ECSAP program consists of 180 agents stationed today throughout the country. They have become invaluable specialists, both for our own investigations as well as for our local and federal law enforcement partners. From June 1, 2001 through June 1, 2002, ECSAP agents completed over 1,400 forensic examinations on computer and telecommunications equipment. The nationwide demand among our local law enforcement and private sector partners for investigative or prevention-based assistance from our ECSAP agents is overwhelming, and we are striving to expand this program and training within our agency’s existing resource levels.

Another important component of our strategy to secure our financial and critical infrastructure is the development of the Secret Service’s electronic crime task forces. Several years ago, the Secret Service recognized the need for law enforcement, private industry and academia to pool their resources and expertise as part of a collaborative effort to investigate and prevent electronic crimes and protect our nation’s critical infrastructure. In New York alone, our task force is comprised of over 300 individual members, including 50 different federal, state, and local law enforcement agencies, 250 private companies and 18 universities. This task force has made 961 state and locally-prosecuted arrests and investigated an estimated $960 million in actual and potential losses due to fraud.

The USA Patriot Act of 2001 authorized our agency to extend these task forces to cities and regions across the country. Last year, we launched the initial phase of this expansion, developing task forces in locations with significant or specialized interests in the financial, banking or critical information sectors, including Los Angeles, San Francisco, Las Vegas, Chicago, Charlotte, Miami, Boston, and Washington, D.C. We have received strong and enthusiastic support for this program from the scores of local law enforcement agencies we work with, as well as our private sector partners, who are all excited about the potential of this exciting new endeavor. These task forces represent a potential means of extending the preventative mission so imperative to homeland security to communities across the country.

Based on our experience, the first line of defense in combating cyber crime is often an agent or officer who is trained in methods of preserving and securing evidence at electronic crime scenes. In recognition of the time sensitivities associated with computer crime, the importance of properly seizing computer-related evidence, and the increasing complexity of cyber-related crime, we continue to see the value in promoting partnerships and training. In the course of investigating electronic crime and developing strategies in search of the best formula, we have found prevention, collaboration, information sharing and timely response to be essential factors in the equation.

Consequently, the Secret Service, in cooperation with the International Association of Chiefs of Police (IACP), recently introduced the Forward Edge training package. Forward Edge utilizes state-of-the-art computer training designed for all law enforcement and provides instruction with regard to securing electronic crime scenes and safely seizing computer-related evidence. Forward Edge includes an 8-hour CD-ROM, utilizing a three-dimensional, interactive training format, to provide the officer or agent with different scenarios involving identity theft, financial crimes, network intrusion, credit card fraud, counterfeiting, data theft and other computer-related crimes. The CD-ROM also provides a field guide that contains practical information, such as an inventory of local computer crime statutes for every state jurisdiction, along with sample search warrants pertaining to the seizure and safe handling of computer-related evidence, drugs and weapons. Each scenario guides the trainee through crime scenes and enables him/her to interact with objects, individuals and situations they may encounter in real life. In FY2002, the Secret Service completed distribution of 20,000 copies of Forward Edge to local, state and federal law enforcement agencies.

Counterfeiting

Despite the inclusion of enhanced security features in the most recent designs of our currency, counterfeiters continue to take advantage of the latest digital technology to produce reasonably deceptive counterfeit notes. Desktop printers, color copiers, scanners and graphics software provide relatively unskilled counterfeiters with the basic tools to quickly and easily produce counterfeit U.S. and foreign currency, securities, bonds, checks and other obligations.

Counterfeit currency produced using digital technology, such as computer printers and copiers, accounted for an estimated 39 percent of counterfeit notes passed on the American public in FY2002. The balance of notes passed in the United States were manufactured using traditional offset printing methods. Despite the fact that digitally-produced counterfeit currency accounted for just over one-third of domestic passing activity, this type of counterfeiting resulted in 86 percent of domestic counterfeit arrests and 95 percent of domestic counterfeit printing operations suppressed by the Secret Service.

Digital counterfeiting presents a continuing challenge to law enforcement due to the widespread availability, ease of operation, and mobility of personal computers. The privacy and convenience of personal computer systems encourages experimentation, and permits the printing of counterfeit currency with considerably less risk and expense than traditional printing methods.

The Secret Service has long believed that the best tool in the fight against the proliferation of counterfeit currency is an educated public. Just as we practice prevention in our protective mission, our proactive approach to investigations is hinged upon the education and training seminars provided to business owners, retail groups, the financial industry, and state and local law enforcement. These counterfeit currency detection seminars provide key sectors of our public with the information they need to effectively protect themselves and their businesses from becoming victims of counterfeiters. In addition to providing training and education, the Secret Service publishes and distributes public education brochures describing the security features used to authenticate genuine currency.

From an international perspective, the Secret Service continues to send instructors to the International Law Enforcement Academies (ILEA), where we provide training to foreign police representatives in the detection of counterfeit U.S. currency and offer information on strategies useful in investigations of counterfeiting. Last year, the Secret Service offered currency identification training to law enforcement and banking officials from 47 countries.

Our continued presence overseas and the training provided through the ILEAs is paramount in our ongoing efforts to suppress and seize the increasing amount of foreign-produced counterfeit U.S. currency being sold, shipped and trafficked throughout the world. The Secret Service estimates that nearly 50 percent of all counterfeit U.S. currency passed domestically originates overseas. As the continued suppression of counterfeit printing operations and seizures of counterfeit currency in Colombia indicate, that country remains the leading producer of counterfeit U.S. currency in the world. The Secret Service maintains a permanent presence in Colombia through our office in Bogotá. While lacking law enforcement authority overseas, we work closely in an investigative liaison capacity with law enforcement, prosecutors and government officials throughout the region. These efforts include providing training and investigative support aimed at suppression, seizure, deterrence, education, and intelligence-gathering regarding the organized criminal networks involved in transnational counterfeiting. The culmination of these efforts is apparent in the achievements of “Plan Colombia.”

Since its inception in May of 2001, Plan Colombia has enjoyed tremendous success. As of last December, the combined efforts of our agents working in cooperation with the Colombian government have resulted in 109 arrests, 26 plant suppressions and over $92 million in counterfeit U.S. dollars seized in Colombia prior to distribution. Accordingly, in FY2002, there was a 22 percent decrease in Colombian-manufactured counterfeit U.S. dollars passed on the American public from the previous year.

Increasingly, Colombian counterfeiters have targeted “dollarized” economies. In December of 2001, the Secret Service and Colombian authorities intercepted a package of over $40 million in counterfeit U.S. dollars intended for distribution in Ecuador, which had previously adopted the U.S. dollar as its own currency. In July of 2002, the Colombian authorities, in cooperation with our own personnel, seized the first counterfeit $1 coin (Sacagawea or “Golden Dollar”) production operation in Bogotá. As of January, 2003, three additional counterfeit $1 coin plants had been suppressed in Colombia. In each case, the seized coins were intended for shipment and distribution in Ecuador where, according to the Federal Reserve, there are approximately $10 million in genuine $1 coins in circulation.

Counterfeiters are keenly aware that the public, banks, and law enforcement in these dollarized countries are less familiar with counterfeit U.S. currency, and the punishment for smuggling, possessing, and passing counterfeit U.S. currency is generally far less than in the United States. Each of these factors decrease risk, lower costs, and thereby increases profits for the counterfeiter. Therefore, a continued Secret Service presence in this region is vital to maintaining both economic stability in these countries and confidence in the U.S. dollar.

In August of 2002, the Secret Service and the Colombian National Police jointly hosted the “International Conference on Counterfeit U.S. Dollars – Production, Distribution, and Criminal Prosecution” in Bogotá. The conference was attended by senior law enforcement officials and prosecutors from sixteen North, Central and South American countries, as well as representatives from Spain, Turkey, EUROPOL, and the Southern European Cooperative Initiative. This historic conference served to improve coordination, build new relationships, and enhance existing efforts within the international law enforcement community. The conference was yet another example of our emphasis on building and maintaining partnerships with foreign law enforcement officials; in this case with a focus on the production, distribution and trafficking of counterfeit U.S. currency.

Identity Theft

It remains an investigative priority of the Secret Service to promote a public education program and work with law enforcement at all levels in preventing identity theft. Public awareness constitutes our best defense against identity theft and provides guidance to consumers on how they can effectively safeguard their private information. A stolen identity can provide a criminal with the tools and information necessary to establish good credit and obtain things of value through illicit means. Personal information can be used to establish bank accounts, obtain credit or debit cards, or gain unauthorized access to financial accounts or other sources of capital. Not surprisingly, most financial crimes, including bank fraud and credit card fraud, involve identity theft.

The Secret Service hosts identity theft forums involving businesses, civic groups, community organizations and local police departments, and shares our “best practices” for preventing such crime and protecting consumers. We participate in and organize such events in communities across the country. In cooperation with the Federal Trade Commission (FTC) and the IACP, the Secret Service is developing an identity crime video and CD-ROM. This project is designed to provide information to local and state law enforcement personnel that will assist them in investigating identity crimes at the local level. The video and CD-ROM will serve as an information and resource guide, providing downloadable materials such as state and federal identity theft statutes, the FTC’s Victim Assistance Guide and Sample Affidavit, a “Best Practices Guide to Identity Crime,” the local contact numbers for the Secret Service, Postal Inspection Service, FBI and other agencies, and credit card fraud and related information from our partners in the financial services industry. This valuable training tool should be available in the coming weeks, and the Secret Service will be distributing a copy to every police department in the United States.

Global Financial Crime

The professional and effective relationship we have developed with the Colombian government, and the similar success stories we have enjoyed among our other 19 foreign field offices, can be attributed to our long-term commitment to work with the host nation in a cooperative environment. This environment fosters relationships built on trust and mutual respect, and results in the sharing of information and expertise. Where permanent stations are not available, the Secret Service relies on temporary assignments to satisfy the requests for participation in overseas financial crimes and counterfeit task forces. Within the last two years alone, the impact of our work through temporary assignments in Lagos, Nigeria, Bucharest, Romania, and Frankfurt, Germany has resulted in the opening of permanent offices.

In addition to the protection of our currency, the Secret Service’s efforts abroad are directed at protecting the integrity of our financial infrastructure through responsiveness and timely assistance at the point of attack. Within our agency’s existing resource levels, the Secret Service will seek to establish additional foreign offices in areas where there is a demand for our expertise, continued requests for partnerships, and in regions that make sense strategically and offer a high probability of a favorable return on the investment.

Security of Identity Documents

The heightened threat of terrorism within the United States reinforces the need to secure, authenticate, and trace identification documents. There are no current uniform standards for identification documents in the United States, and many identity documents today, particularly state drivers’ licenses, were not designed with security in mind. They often include features that are either available on the Internet or can be easily simulated by amateur counterfeiters using widely accessible technologies. With over 300 different, yet legitimate, formats for state driver licenses in use today, it has become nearly impossible for law enforcement to authenticate a questioned document.

The counterfeiting of documents continues even after a change in design or security features. For this reason, the Secret Service’s Forensic Services Division sponsors the Document Security Alliance (DSA), comprised of business leaders from the credentialing and identity document industry. The DSA’s goal is to focus the efforts of this multi-disciplinary group on improving the security and procedures associated with identity documents. This organization has discussed and explored various processes, methods, techniques and technologies that could be used to improve the forensic tracing of fraudulent documents.

Our agency has investigated cases where individuals were in possession of multiple genuine driver licenses, each bearing that individual’s photographs with different biographical information. Subsequent information revealed that state motor vehicle administrators, upon receipt of counterfeit “breeder” documents, issued the licenses. The notion that criminals can generate counterfeit breeder documents, such as birth certificates and Social Security cards, and obtain with little difficulty more secure documents such as passports, throws a spotlight on one of our most troubling vulnerabilities. The Secret Service maintains a database consisting of over 90,000 counterfeit identity and monetary documents. These counterfeit documents include credit cards, travelers checks, bank checks, Social Security cards, immigration documents, birth records, work identities and drivers licenses. The database was created to allow for link analysis or data mining of records that would not normally be discerned through traditional investigative or forensic approaches. The current system has produced numerous investigative leads and is considered the largest database of its kind in the world. The ability to collect, analyze and catalogue documents relating to terrorist investigations, and to provide a forensic link analysis in tracking criminals and terrorists throughout the world, is critical. The Secret Service has developed and implemented a Web-based application that provides law enforcement agencies across the country with access to all genuine identification documents used in the United States. Within seconds, law enforcement personnel can request an image file of a specific document along with critical information necessary to examine the document effectively.

The images can be enlarged, printed or used for comparison with the document in question. The application can assist the officer with step-by-step instructions to aide searches without the requirement for specific knowledge in the area of counterfeit documents. The program also provides additional instruction in detecting common defects in counterfeit documents as well as security features in genuine documents. A scanning feature will also be incorporated to allow a document to be submitted to our forensic lab. The anticipated turnaround time for a decision on the authenticity of the suspected document will be less than 60 minutes.

National Center for Missing and Exploited Children

The Secret Service derives enormous professional and personal fulfillment from our relationship with the National Center for Missing and Exploited Children (NCMEC), and continues to provide the valuable analytical, forensic and laboratory support, and other assistance that the Center has benefited from in recent years.

Since the passage of the Violent Crime Control and Law Enforcement Act of 1994, the Secret Service has provided forensic and technical support to the NCMEC, including the use of the Automated Fingerprint Identification System; the Forensic Information System for Handwriting; ink analysis and comparison; traditional handwriting and fingerprint comparison; polygraph examinations and consultation; visual information services such as image enhancement, suspect drawings and video and audio enhancement; graphic and photographic support; and age regression/progression drawings. In FY2002, the Secret Service conducted 29 polygraph examinations in direct support of the NCMEC’s mission. The examinations for these cases involved missing, abused and murdered children.

We also actively support the Center’s Operation Safe Kids initiative -- a national, community-based awareness effort. We utilize a computer-enhanced application known as the Children’s Identification System (KIDS), to acquire a photograph, fingerprints and biographical data of a child that are then printed and provided to his or her parents. This program has been offered at public events throughout the country, and to date, we have fingerprinted more than 35,000 children under the KIDS program.

The Secret Service is also developing a Forensic Investigative Response and Support Team (FIRST). FIRST will be comprised of forensic experts able to respond on short notice to requests for assistance from state, local, or other federal law enforcement agencies, providing time-sensitive forensic support to requesting agencies in cases involving missing or exploited children. In essence, when the NCMEC is notified by a local law enforcement department of an abduction, the Secret Service will be capable of launching a FIRST team to respond within the first eight hours of abduction, providing computer, forensic and “real-time” investigative support to a local police department that may lack the resources to respond in an effective manner during that critical period.

PROTECTIVE PROGRAM

Since 1901, the Secret Service has been responsible for protecting our nation’s highest elected officials, visiting world leaders and other designated individuals. In addition, our current mission includes reducing threats posed by global terrorists and other adversaries, and providing the safest environment to those participating in events of national significance. We perform this mission by providing continuous protective operations that offer comprehensive security for our protectees and the facilities where they work and live, and, by coordinating, planning and implementing security plans at important events and functions designated by the President as National Special Security Events (NSSEs).

In recent decades, our protective mission has expanded beyond the protection of the President, the Vice President and their immediate families. Today, we are also mandated to provide personal protection to the President-elect, the Vice President-elect and their immediate families; major Presidential and Vice Presidential candidates and their spouses; visiting foreign heads of state or governments; former Presidents, their spouses and children under the age of 16; and other government officials as designated by the President. We also provide security for the White House Complex, the Vice President’s residence, and 519 foreign missions within the Washington, D.C., area.

Mr. Chairman, we have witnessed a decade of well-planned and well-executed attacks, both at home and abroad, against Americans and American symbolic targets. Oklahoma City; Khobar, Saudi Arabia; the U.S. embassies in Kenya and Tanzania; the U.S.S. Cole, and of course, the World Trade Center and the Pentagon in 2001. These tragic events remind us of our vulnerabilities and the changing threats our nation faces each and every day. The Secret Service continues, as a matter of practice, to assess these threats and evaluate the application of our protective methodologies. We have assumed new responsibilities in the form of additional protective details, and we continue to adjust the depth of coverage to enhance the Presidential, Vice-Presidential, and Former Presidential protective details. Today, the Secret Service provides full-time protective details for 27 individuals, a number that increased sharply following the September 11th attacks.

Our protective mission was further expanded in 2000, when Congress authorized the Secret Service to plan, coordinate and implement security operations at designated events of national significance. This authority was a natural evolution for the Secret Service, as we have led security operations at large events involving the President dating back to our first protective mandate in 1901 and have developed an expertise at planning these events and coordinating security with our local, state and federal law enforcement partners. Since 1999, the Secret Service has led security operations at 12 NSSEs, including the 2000 Republican and Democratic National Conventions, the 2001 United Nations General Assembly, and, most recently, the 2002 Winter Olympics and Super Bowl XXXVI.

The actual planning and coordination of these events requires an intensive, sustained effort, and the volume of both financial and human resources required to develop and execute a sound physical security plan for a NSSE can be immense. The 2002 Winter Olympics in Salt Lake City, for example, involved an unprecedented interagency collaboration between federal, state, and local law enforcement, as well as the military, working with the Salt Lake Organizing Committee, the International Olympic Committee, the State of Utah, and other entities. Security for the competition and ceremonies was provided for a four-week period, 24 hours a day, for an estimated 65,000 daily spectators, including 2,500 athletes in 15 protected venues. These venues stretched over an area covering 900 square miles, slightly smaller than the state of Rhode Island. It was the largest and most comprehensive coordinated security event in the history of American law enforcement.

In addition, the annual meeting of the United Nations General Assembly (UNGA) is held each year in New York City. On average, 50 to 80 heads of state/government attend this event. It is important to note that each year, the UNGA is a manpower and resource intensive effort for the Secret Service.

We consider the protective mission as an evolutionary process, essential to the security of our homeland. We apply that thought process when planning and executing security, and we analyze the actual and potential threats during increasingly complex protective operations. Adapting to changing situations in a changing environment, sound planning on all planes, and employing technology or other applications to our advantage is fundamental to our strategy.

There is also a vibrant interrelationship between our protective and investigative responsibilities. Since 1865, the Secret Service has developed a unique capacity to build strong and trusted partnerships with local, county and state law enforcement in furtherance of our investigative mission. It is important to note that these are partnerships in their truest form. They are built over time, and involve information sharing, open communication, and, perhaps most critical, mutual trust.

Building an atmosphere of trust and cooperation with local police is not only central to our criminal investigations and prevention-oriented partnerships, it is also the keystone to fulfilling our protective mission. For travel outside of Washington, D.C., the Secret Service executes our security plan with the cooperation and resources of the local police in the area, as coordinated by our field office.

The cooperative atmosphere that has already been established between our field office and local law enforcement with regard to our investigative duties breeds successful interagency collaboration during Presidential and other protectee visits. Simply put, there is already a precedence of trust between the parties that need to cooperate and coordinate their efforts, and the Secret Service builds upon that relationship to prepare for and provide a seamless and secure environment for our protectee.

Not only is there a connection between our investigative responsibilities and the protection of the President, but the strength of our protective capabilities is dependent on our investigative mission. Every agent currently assigned to a protective detail began their career in the Secret Service as a criminal investigator in a field office, where they spent considerable time developing their skills and expertise by investigating counterfeit cases, financial crimes, protective intelligence cases or protecting critical infrastructure.

A Secret Service agent is among the most skilled law enforcement operatives in the world, largely due to their investigative training and experience. This extended field training provides an opportunity to apply analytical skills and various investigative techniques while testing their maturity and judgment. These are the building blocks necessary for the transition of our agents into the next phase of their careers -- protecting our nation’s highest elected leaders. Because of this investigative experience, our protective agents are multi-dimensional, relying on an array of skills and instincts to protect our nation’s leaders. We draw upon those individuals who have years of experience in the field, who not only have acquired the requisite skills, but have been tried and tested under difficult circumstances, and have proven decision-making and other abilities that are crucial to protective missions. This investigative experience prepares our agents for the mental and physical challenges faced while planning and coordinating security, while always being ready to recognize and react instantaneously to a threat.

As you can see, Mr. Chairman, our protective and investigative responsibilities are thoroughly intertwined and interdependent. They are the heart and soul of the Secret Service, and complement each other in a manner that is truly unique among law enforcement today.

OFFICE OF PROTECTIVE RESEARCH

Intelligence Division

The protective research and intelligence programs continue to serve a critical role in support of the dual missions of the Secret Service. Our Intelligence Division coordinates all Secret Service investigations related to direct threats against our protectees and develops threat assessments related to protected individuals, facilities and venues. This process involves the identification, assessment, and management of all information and incidents directed toward our protective efforts, both at home and abroad. The division evaluates risk potential associated with specific and generalized threats; prepares analyses of protectee-specific threats; maintains liaison with other law enforcement and intelligence agencies; plans and reviews the case management for high risk subjects; and, through our National Threat Assessment Center, collaborates in the design and implementation of program evaluation studies and other risk assessment research designed to improve our understanding of violence directed toward public officials.

During FY 2002 and FY 2003, the Intelligence Division supported the development and implementation of the Department of Homeland Security, including the Information Analysis and Infrastructure Protection Directorate and related Working Groups, Sub-Working Groups, and Planning Committees. As the Secret Service continues its transition to the DHS, the Intelligence Division will take on increased responsibilities, including the staffing of the DHS’s multi-agency Homeland Security Center (HSC). The HSC provides a 24-hour “watch center” and serves as the Department’s single point of integration for information related to homeland security. The HSC is responsible for maintaining domestic situational awareness; detecting, preventing, and deterring incidents; and managing the response to all critical incidents, natural disasters and threats.

In addition, the Intelligence Division will be uniquely involved with the Administration’s new intelligence analysis initiative, the Terrorist Threat Integration Center (TTIC). The TTIC will merge and analyze terrorist-related information collected domestically and abroad in order to form the most comprehensive threat picture possible.

The Secret Service’s active role in these new and enhanced intelligence initiatives will play an important role in the overall mission of the DHS. The Secret Service is committed to full and active participation in the protection of our homeland; and further, it is imperative that our agency always has access to information that is vital to our own protective and investigative missions.

The Secret Service will provide full-time staff for the 24/7 operation of the HSC and the TTIC from within our Intelligence Division. Our personnel assigned to the HSC and the TTIC will be responsible for receiving and disseminating incoming intelligence information, as well as providing DHS with a point-of-contact for Secret Service response capabilities.

The Intelligence Division coordinates Secret Service participation in the Department of Justice-led Joint Terrorism Task Forces (JTTFs). Currently, 58 Secret Service agents participate in JTTF programs in 51 offices. In addition to collaborating in a combined and coordinated effort, the Secret Service provides and derives the benefits of sharing information on investigative matters that may be related to our protective mission.

In addition to directing and performing such operational activities, the Intelligence Division continues to provide leadership for the Protective Detail Intelligence Network (PDIN), a consortium of Washington, D.C., area law enforcement, security, and public safety agencies with protective and security-related functions. Initiated in 1999 by the Secret Service, the PDIN has emerged as an important forum for sharing intelligence information that affects security planning issues across agencies in the metropolitan area. PDIN meetings include briefings and training concerning significant and designated major security events coordinated by the Secret Service, and they facilitate cooperative partnerships among agencies who share protective and security responsibilities. Through the PDIN, the Secret Service has offered assistance in the preparation of security assessments for incoming Cabinet members and senior Administration officials.

National Threat Assessment Center

As part of the Secret Service’s protective intelligence mission, our National Threat Assessment Center (NTAC) continues to gain national attention through its training, outreach, consultation, and research efforts in the specialized field of targeted violence. Its principal goal encompasses the spectrum of threat assessment and targeted violence as it relates to our protective mission. As a natural extension of our protective intelligence methodology, we continue to share our knowledge and depth of experiences with the DHS, demonstrating the utility of Secret Service “Best Practices” for identifying, assessing, and reducing threats to homeland security.

NTAC also continues to support the development of the new Department. NTAC has assisted the Information Analysis & Infrastructure Protection Directorate (IA&IP;) in the development of a Competitive Analysis & Evaluation Office (CAEO), providing detailed personnel to ensure that the DHS has an operationally-sound quality assurance function. The purpose of the CAEO is to reduce the risk and consequences of domestic terrorist attacks by ensuring that the IA&IP; Directorate’s initiatives are tested and are of the highest quality and value. NTAC is also participating in “Red Teaming” exercises with the Department. Red Teaming is a risk assessment technique that tests an organization’s methodologies and analyzes the vulnerabilities from the perspective of the threat.

Following the attack at Columbine High School in 1999, NTAC entered into a partnership with the Department of Education and the National Institute of Justice to apply the methodology used in our traditional analysis of targeted violence, in the form of a study designed to examine if similar behavior was involved in school shootings. This study, known as the Safe School Initiative, reviewed 37 school shootings occurring in the United States in the preceding 25 years. The Safe School Initiative was completed in 2000, focusing on operationally-relevant information -- information that law enforcement professionals, school personnel, and others could use to try to prevent future school shootings. The Initiative examined the pre-attack behavior and communications of school shooters, to identify information that might be discernible in advance of an attack, and could allow for intervention.

NTAC staff has been able to communicate what we have learned in assessing threats on public officials and our findings in the Safe School Initiative with those with an interest in preventing school and workplace violence. In 2002, NTAC, in collaboration with the Department of Education, completed and published the final product of the Safe School Initiative: the study’s Final Report, and a Guide to Threat Assessments in Schools. These materials suggest methods for school administrators, educators, law enforcement personnel, and mental health professionals to conduct threat assessments in their schools.

The Secret Service and Department of Education have thus far conducted 46 Safe School Initiative presentations and 12 day-long training seminars around the country, providing thousands of school officials, law enforcement professionals and others information on how to respond to and manage threatening situations in our schools. NTAC was also involved in other seminars and forums in FY 2002, including 28 Exceptional Case Study Project/Threat Assessment Training Presentations, five Field Protective Intelligence Briefings, and four Threat Assessment Seminars.

Also noteworthy is the Insider Threat Study, a collaboration between the Secret Service and Carnegie Mellon University’s Computer Emergency Response Team Coordination Center (CERT/CC) focusing on insiders who attack critical information systems. This partnership seeks to strengthen critical infrastructure protection efforts and provide private industry and law enforcement with information to help prevent insider attacks. The Insider Threat Study uses operational methodology of previous NTAC studies to examine network compromise incidents committed by insiders, such as current or former employees, and seeks to identify discernible behaviors and communications that could assist in the prevention of future compromises.

NTAC has also proposed the creation of an information-sharing system for agencies with protective responsibilities. This system, dubbed the Targeted Violence Information-Sharing System (TAVISS), would contain a repository of names of subjects with a known or suspected adverse direction of interest towards local, state, and federal public officials. TAVISS would be directly accessed from remote sites by multiple law enforcement agencies with protective responsibilities for such public officials.

Technical Security Division

The Technical Security Division (TSD) is responsible for creating a safe and secure environment for Secret Service protectees and the facilities we protect. This includes the responsibility of managing all chemical/biological/hazardous materials countermeasures programs of the Secret Service that safeguard our protectees and facilities, and the mitigation of any threats of terrorism.

As part of its ongoing support mission, TSD identifies and implements ways to improve its detection capabilities in and around the White House Complex, Naval Observatory and other protected locations. Outside of Washington, D.C., chemical/biological/hazardous material support is integral to any protective security plan during motorcade movements or at fixed locations, including all designated National Special Security Events.

TSD has two significant programs of interest that demonstrate the Secret Service’s ability to mitigate specific threats: the Radar Airborne Intrusion Detection System (RAIDS), and the Hazardous Agent Mitigation Medical Emergency Response Team (HAMMER).

The RAIDS is a classified network of air intrusion detection equipment that allows the Secret Service to continuously monitor the airspace in the Washington, D.C. area. Segments of the system have recently been upgraded, and, at the recommendation of classified studies, additional subsystems will be incorporated to address existing and emerging threats.

The HAMMER team was developed to provide rapid intervention to Secret Service protective details in the event of a chemical, biological or radiological incident. The HAMMER team consists of TSD personnel trained in hazardous materials identification, mitigation, decontamination, and basic life support. In the event that a hazardous environment incapacitates the protectee’s primary medical support, the team can provide basic life support and decontamination prior to patient transport. The team will provide field tests and take samples for transport to remote laboratories for testing and identification. TSD has agreements in place for laboratory analysis of suspect materials. The HAMMER team will automatically deploy when a chemical, biological or hazardous materials release occurs and Secret Service protectees, or one of the facilities that we protect, are affected.

Information Resources Management Division

The Information Resources Management Division (IRMD) continues to provide an information and communications infrastructure in support of the protective and investigative missions of the Secret Service. The Secret Service’s move to the Department of Homeland Security has significantly increased IRMD’s role and responsibilities. Management and staff from this division are engaged in many of the DHS Working Groups and Sub-Working Groups, including the CIO Investment Review Group, Technical Reference Model Working Group, Security Sub-Group, Network Sub-Group, Web Management Sub-Group, Directory Services E-Mail Sub-Group, Collaboration Sub-Group, Data Management Sub-Group, Records Management Sub-Group, Geospatial Sub-Group, Wireless Sub-Group, E-Learning Sub-Group, First Responders and Emergency Preparedness, CFO Council, and a Classified IT Technical Team.

In FY 2002, IRMD continued to upgrade and improve system-wide efficiencies in radio, telephone and wireless communications. The priority initiatives include the conversion of Legacy mainframe applications to a Web-based system and upgrading headquarters and field office voice/data capacity. IRMD also completed its test of the Treasury Smart Card Proof of Concept and is in the process of integrating this new technology into the workplace. There are two significant benefits driving the move to smart card use and acceptance: the ability to securely store Public Key Infrastructure certificates (part of an elaborate process to authenticate ones’ identity over electronic interfaces such as the Internet), and the ability to use digital signatures to authorize government activities. This program has also been presented to the DHS Chief Information Officer for potential use at the new Department. Emergency Preparedness Program (EPP)

The EPP is responsible for coordinating the emergency preparedness programs of the Secret Service and concentrates its efforts on operations security, the continuity of government and critical infrastructure protection. The EPP staff coordinates with the White House Military Office, the Emergency Preparedness and Response directorate and other agencies regarding matters involving the continuity of government and emergency preparedness. Internally, EPP staff coordinates emergency preparedness exercises and provides frequent educational material and training to staff in all areas of emergency preparedness. In FY 2002, EPP assisted the DHS with the development of the Emergency Preparedness and Response Directorate, and participated in efforts to create an emergency preparedness database to be shared among all agencies in the DHS. EPP has also been involved in the Homeland Council on Domestic Threat Response and Incident Management, and the Weapons of Mass Destruction Management Policy Coordination Working Group. EPP actively participates in the National Capitol Region Planning Committee Working Group that coordinates emergency preparedness efforts, particularly Federal Emergency Decision and Notification Protocol in the District of Columbia region.

HUMAN RESOURCES AND TRAINING

Workforce Retention/Workload Balancing Initiative

The House and Senate Appropriations Committees should be commended for recognizing and supporting the priority of the Secret Service to confront the declining quality of life of our workforce caused by excessive overtime, out-of-district travel and other such factors. In FY 2000, the Secret Service began our Workforce Retention/Workload Balancing Initiative with the goal of hiring 682 additional agents during a three-year period. I am pleased to report that the Secret Service exceeded this goal by more than 60 percent, hiring a cumulative total of 1,098 special agents. In addition, the Secret Service enhanced the quality of life of all of our employees by hiring 545 Uniformed Division officers and 453 support personnel during the same period, far exceeding the original target under the Workforce Retention/Workload Balancing Initiative.

Despite our impressive hiring achievement, we have experienced a higher than normal level of attrition, attributable largely to ongoing retirements and transfers. This attrition requires us to continue our aggressive hiring plan and to reinforce our ranks, whose unique skill set is in high demand both in the government and private sectors. The safety, morale and job satisfaction of our entire workforce are of paramount importance.

For FY 2003, in order to meet our strategic goals of protection, investigation, and providing a responsive support infrastructure, the Secret Service plans to hire 893 special agents, Uniformed Division officers, and support personnel.

Diversity

It is the policy of the Secret Service to attract, develop, retain and maximize the potential of a diverse workforce in a changing and competitive environment. We are committed to this policy. As a means of fully achieving and emphasizing an organizational culture that recognizes the value added by a diverse workforce, the Secret Service has organized its Diversity Management Program under the direction of a Deputy Assistant Director for Recruitment, Employment and Diversity Programs (REDP). Through a coordinated process, the REDP develops and implements recruitment policies with our agency’s Recruitment and Hiring Coordination Center, the Diversity Management Program, and the Chief of the Personnel Division.

In support of the Secret Service’s initiative to recruit, develop, and retain a diverse workforce, the Diversity Management Program hosts quarterly, interactive training conferences designed to address diversity issues throughout the agency. In FY 2000, the Secret Service contracted with the Ivy Planning Group, a premier management consulting firm, whose skilled trainers have augmented our diversity conferences over the past two years. The Ivy Planning Group assists major organizations within the federal government and private sector in becoming more customer-driven by focusing on strategic and tactical planning, marketing and cultural diversity. Approximately 150 of our employees participated in these training sessions last year. The Diversity Management Program also offered a “Conference on Supervisory Diversity Issues”. In support of President Bush’s Management Agenda regarding the Strategic Management of Human Capital, this class was attended by “middle” management and focused on issues within the Secret Service.

The Secret Service supports and encourages employee participation in conferences dedicated to minority interests. In addition to our internal diversity training, the Diversity Management Program sponsors employees who participate in the following national training conferences:

• Women in Federal Law Enforcement • National Organization of Black Law Enforcement Executives • National Native American Law Enforcement Association • Hispanic American Police Command Officers Association • National Asian Peace Officers Association • Blacks in Government Training Conference

In FY 2002, approximately 120 employees attended the following conferences: the Women in Federal Law Enforcement Conference; the Hispanic American Police Command Officers Association Training Conference; the National Organization of Black Law Enforcement Executives Training Conference; the Blacks in Government Training Conference; and the National Native American Law Enforcement Association Training Conference.

Last year, the Secret Service sponsored 14 recruiting seminars attended by 4,446 potential applicants for Uniformed Division and Special Agent positions. The Recruiting and Hiring Coordinating Center (RHCC) continued its liaison efforts with the Historically Black Colleges and Universities, the Hispanic Servicing Institutions and Women’s Colleges by attending career fairs at many of these institutions. Additionally, the RHCC mailed out Special Agent and Uniformed Division officer brochures to each of these institutions highlighting career opportunities with the Secret Service.

The RHCC also ran recruiting “banner” ads on Internet websites targeted towards specific ethnic minority groups, including Hispanic Online, BlackVoice.com, GoldSea.co

   
 
 
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