[Washington Post - 11/7/01] Two FBI agents, flashing badges and speaking quietly and politely, walked into a local business recently and asked for confidential company information.
The company's lawyer said the agents wanted to review the records right then and there. But they didn't have a subpoena, a summons, a warrant or anything else that resembled a court order.
"They don't seem to be bothering with all that these days," said Bill Lawler, the firm's outside counsel and a partner at Vinson & Elkins in the District. "They just show up and say 'Here we are' and 'Give us your stuff.' "
Lawler, a former federal prosecutor who specializes in government investigation work, said two other clients elsewhere have had similar visits by federal agents since the Sept. 11 terrorist attacks. Lawler, citing attorney-client confidentiality, declined to identify the companies. He said only that they were a financial services company and two telecommunications firms.
"In some cases, some information has been handed over with the appropriate safeguards," Lawler said.
Lawyers who specialize in government investigations predict that such requests will become more frequent. The FBI declined comment.
The anti-terrorism law passed two weeks ago allows the FBI to shift its focus from solving crimes to gathering domestic intelligence. The Treasury Department has been charged with putting together a financial intelligence-gathering system whose data are retrievable by the CIA. And the CIA now has the authority to influence domestic FBI surveillance operations.
In short, the new law lays the groundwork for a domestic intelligence-gathering system with unprecedented power.
Lawyers say the FBI is within its rights to show up unannounced and ask for information. After all, it's only asking. But they caution that there may be legal implications for a company that hands over confidential information.
So what's a business to do when the feds show up unexpectedly? Here's some advice from local lawyers:
* Immediately call either the company lawyer or, if there's no inside counsel, an outside lawyer with experience in government investigations.
"If what the agents are requesting does not implicate issues of privilege, corporate confidences and personnel information, the company could just comply," said DeMaurice Smith, a criminal-defense lawyer and partner at Latham & Watkins in the District. "But they need to be sure it doesn't. It all depends on the nature of the request." Smith said that although he hasn't received any calls from clients with such problems, he's "heard through the grapevine that others have."
Banks, for example, must see a subpoena, search warrant or summons before turning over any client information, according to the American Bankers Association.
"The laws are very clear when it comes to banks," said John Byrne, senior counsel at the trade group. "Privacy is a major issue. We can't lose sight of that even if we are in a different time."
Byrne said that although the Washington-based association hasn't received any reports of federal agents showing up without court orders, several banks have asked what they should do if approached.
"The answer is still the same," Byrne said. "There is no reason to circumvent the rules."
* Name a point person in the company to evaluate requests for information from government agents.
"If you have a point person to keep track of what the requests are, the company can always speak with one voice," said Adam Noffinger, a former federal prosecutor and a lawyer with Piper, Marbury, Rudnick and Wolfe in Washington. "Companies should let their employees know they should report the request to the point person and let that person deal with the requests. You don't want to advise employees not to speak. However, they cannot be required to speak with the FBI."
Noffinger said the advantage of appointing a lawyer to be the point person would be that when the lawyer talks with employees, those conversations would be privileged and thus subject to confidentiality rules.
* Be absolutely sure that the people asking for information are legitimate government agents. Lawyers say criminals could seek to impersonate federal authorities.
"Most people don't even know what an FBI badge looks like," said Stephen Saltzburg, a law professor at George Washington University and a member of an American Bar Association task force on terrorism. "The propensity to impersonate federal officials could become a tremendous problem. The criminal mind rarely sees a vacuum it doesn't want to fill."
How are companies dealing with the possibility of increased federal information requests? Some aren't talking; others say it hasn't been an= issue.
For instance, local telecommunications giants America Online and Verizon said they have had no unexpected visits by federal agents looking for confidential information.
"We have cooperated with law enforcement in the wake of September 11," said Nicholas Graham, a spokesman for AOL, the Dulles-based Internet arm of AOL Time Warner Inc. "We did work with them on some inquiries they had. We don't get into specifics regarding ongoing criminal investigations. But everything's been done under the proper legal guidelines and procedures."
Lawyers and legal experts predict that the anti-terrorism law will be used in government investigations for years. They also speculate that both federal officers and government prosecutors will use the law in different ways and to achieve various ends.
"These are broad powers that were enacted to deal with very extreme and dire circumstances," Noffinger said. "When the extreme and dire circumstances cease to exist, though, creative lawyers and agents will continue to use the statutes beyond the specific purposes for which they were originally enacted and beyond their original context.
"It doesn't automatically mean that the laws are going to be abused. It just means that the laws will be used aggressively to apply to whatever type of activity the Justice Department is focusing on. History has shown us that."
In accordance with Title 17 U.S.C. section 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only.
[posted 11/17/01]
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