F.B.I. Was Warned It Could Not Meet Terrorism Threat

By JAMES RISEN and DAVID JOHNSTON New York Times 5/31/2002

The internal assessment, one of the bureau's most closely held documents, found virtually every major F.B.I. field office undermanned in evaluating and dealing with the threat posed by groups like Al Qaeda, the officials said.

The document, called the Director's Report on Terrorism, provided detailed recommendations and proposed spending increases to address the problem, officials who have seen it said.

Despite this assessment, the bureau failed to win an increase in the Justice Department spending request submitted shortly before the Sept. 11 attacks. On Sept. 10, Attorney General John Ashcroft rejected a proposed $58 million increase in financing for the bureau's counterterrorism programs. But a Justice Department official said today that the director's report was not provided to Mr. Ashcroft's budget staff.

Even as the director's report was describing how the bureau lacked the ability to respond adequately to the wide array of significant terrorist threats facing the nation, bureau officials missed clues from at least two of its field offices about the possibility of a terrorist attack on the United States, a failure that led this week to the announcement of a sweeping overhaul of the bureau's mission by its director, Robert S. Mueller III.

Today, F.B.I. officials said that the report was intended to support the agency's budget request and was not meant as a comprehensive assessment of whether the bureau could thwart terror attacks from a specific group.

But the report did provide an accounting of the abilities of each F.B.I. field office in the country to deal with the overall terrorist threat. It graded the ability of each office to deal with overall terrorist threats, and also looked ahead to try to determine how much more would be required over the next five years. Based on a color-coded system, with red meaning that a field office was unable to counter the terrorist threat in its region, most of the major F.B.I. field offices were listed as red, officials said.

The report was discussed both by senior law enforcement officials and by other officials critical of the way the bureau and the Justice Department handled counterterrorism matters before Sept. 11.

While the report was not only about Al Qaeda, F.B.I. officials recognized at the time that Osama bin Laden's network posed the biggest threat to the United States. And the fact that the F.B.I. had almost no intelligence on Al Qaeda's plans and intentions in the United States was clearly one of the underlying problems reflected in the way the bureau graded itself in the report.

To a large extent, the bureau's ability to determine that there was a threat from Al Qaeda inside the United States came from technical intelligence — intercepted phone calls and other forms of communication between Islamic extremists overseas and people in this country. Information gathered from witnesses in major terrorist court cases, particularly in connection with the 1998 bombings of two American Embassies in East Africa, also provided some details about the organization.

But the bureau had not thoroughly penetrated Al Qaeda cells in this country, and so had only a little ability to exploit the intercepted communications.

This lack of inside information clearly influenced how the F.B.I. dealt with warnings it received from its agents in the field last summer. In July, an agent in Phoenix sent a memorandum to counterterrorism officials at the bureau's headquarters saying that several Arabs who were being monitored for possible terrorist ties were taking flight training in Arizona. The agent warned that Mr. bin Laden's followers might be coming to the United States for aviation training, and recommended that the bureau conduct a survey of Arab students at flight schools around the nation. Officials at F.B.I. headquarters had not acted on the recommendation before Sept. 11.

And in August, just as the director's report was being received by top F.B.I. officials, agents in Minneapolis arrested Zacarias Moussaoui, a French citizen of Moroccan descent who government prosecutors now believe was the would-be 20th hijacker. Mr. Moussaoui had attracted the F.B.I.'s attention after an employee at a flight school called the Minneapolis office to say that he was taking flight lessons and was acting suspiciously. But before Sept. 11, officials at bureau headquarters rejected a request from the Minneapolis field office to seek a warrant to search Mr. Moussaoui's computer.

With little inside information about Al Qaeda's efforts in the United States, the bureau did not know how to assess the significance of Mr. Moussaoui and could not judge whether the agent in Phoenix was on the right track. The agents in Minneapolis and Phoenix were essentially feeling their way in the dark.

The Director's Report on Terrorism was first produced as a result of an effort by Dale Watson, who now oversees the burea's counterintelligence and counterterrorism operations, to get a better handle on the agency's capacity to deal with newly emerging terrorist threats, officials said. A 1998 strategic plan for the F.B.I., which originated with Robert Bryant, then the deputy director, sought to revamp the bureau so that it could better address counterintelligence and counterterrorism, and Mr. Watson wanted more information from the F.B.I.'s field offices to adjust to the new strategy. Mr. Bryant's plan was in many ways similar to the one just announced by Mr. Mueller, who took over just days before the Sept. 11th attacks.

"In the late 1990's, the world had changed, and Bryant was trying to change the direction of the F.B.I.," said one official familiar with the strategic plan. "So they began to look at their vulnerabilities. They had the capacity to go after a bank robber, but in the late 1990's, they needed the capacity to get better information collection in order to deal with problems like counterintelligence and terrorism, and Bryant saw that the bureau didn't have that capacity. Watson was trying to apply that standard to counterterrorism."

The director's report used several measures to judge the capacity of each field office to deal with the terrorist threat. A field office might need more Arab or Farsi speakers, and might report to headquarters that agents recognized the need for a source at a local university to get to know Arab students. Another field office might report that its counsel needed more training in how to process requests for search warrants and wiretaps under the Foreign Intelligence Surveillance Act.

Law enforcement officials say that the data gathered from the field offices prompted Mr. Watson to push hard for improvements in the bureau's counterterrorism efforts. They added that he recognized that there was an uneven track record on counterterrorism from one field office to another. His efforts were hampered by the fact that the bureau's New York office had become a major, independent player in counterterrorism investigations, however, making it more difficult to coordinate counter-terrorism efforts on a bureauwide basis.

Meanwhile, officials said that after the Bush administration came into office, top Justice Department officials did not initially see the urgent need to upgrade counterterrorism. In August, officials said, the bureau's acting director, Tom Pickard, met with Mr. Ashcroft on a supplemental financing request for counterterrorism, but was turned down.

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