21 July 2004
Homeland Security, Private Sector Partner on Economic Security
New program seeks to identify economic vulnerabilities
By Erica Matsumoto
Washington File Staff Writer
Washington -- The U.S. Department of Homeland Security is partnering
with corporations to increase national economic security, says
a senior department official.
"We are looking to together systematically identify vulnerabilities
within industries and financial systems that fuel corporations
and to share this information with the private sector with the
ultimate objective to eliminate or disrupt and dismantle those
vulnerabilities," said Marcy Foreman, acting director of the Office
of Investigations at Homeland Security's Immigration and Customs
Enforcement agency (ICE) at a meeting announcing the department's "Cornerstone
Initiative." The July 20 meeting in Washington was sponsored by
the Center for Strategic and International Studies (CSIS).
Other speakers at the meeting were Michael Garcia of ICE, Carol
Hallet of the U.S. Chamber of Commerce, Doug Doan of Homeland Security,
Robert Bryden of the FedEx delivery service, and Congresswoman
Katherine Harris (Republican-Florida).
Cornerstone targets the financing mechanisms used by terrorists
to earn, move and store illicit funds. ICE has seized nearly $309
million leading to 1,700 arrests, Garcia said.
ICE, the second largest investigative agency in the federal government,
was created by combining several federal agencies, including as
the U.S. Customs Service and the Immigration and Naturalization
Garcia recalled one illicit operation. Operating out of China,
the organization was caught attempting to smuggle 20 containers
of counterfeit goods, worth a total of $400 million, using a middleman
broker in Lebanon.
Referring to a similar operation, Forman explained that while, "we
did not tie that money necessarily to terrorism, we were able to
prevent it from leaving this country."
"We are looking to choke off illegal funds, whether it's for terrorist
or criminal activity, from leaving the country via currency, money
service businesses, trade based money laundering."
Hallett commented that because many attempts of illegal profiteering
require violating intellectual property rights, the problem of
illegitimate goods has increased dramatically, "and it will only
continue to increase."
"In 1982," Hallett continued, "trade of illegitimate goods drained
$5.5 billion from the global economy. In 1992, the amount rose
to $200 billion, and in 2003, it more than doubled to between $450
and $500 billion in losses globally."
"In the past we have always thought about the counterfeit Gucci
bags or Hermes scarves," but there is a wider range of goods being
illegally produced, she remarked. "For example, in the software
business, 25 percent of all software in the United States and as
high 40 percent worldwide is operating illegally pirated software.
Software piracy is a $1.7 billion problem for Microsoft alone," she
The surge of trademark and intellectual property rights violations
and copyright infringements have led the U.S. Chamber of Commerce
to operate an extensive, comprehensive program.
"With a communications campaign to educate business, media and
lawmakers about these crimes, and a cross-industry coalition of
manufacturers, retailers and law enforcement officials," Hallett
explained, "we are looking to share information with ICE so they
can pursue what we can identify as a violation that law enforcement
may not have identified yet."
"It's really difficult to pick out a fake oil filter from a real
one, and unless the industry can help guide us and tell us what
a fake oil filter looks like, we're pretty much blind and we're
not going to find it," Doan said, emphasizing the importance of
"Homeland security is a shared responsibility," Doan said.
Agreeing with Doan, Bryden said, "It's in our business interest
to be proactive. We know our systems better than anybody else,
and we certainly want to be partners in making sure that our system
is not used to perpetuate some kind of terrorism atrocity on the
U.S.," he said.
The message was clear. In an almost seamlessly integrated global
economy, the effort to secure the nation's economic safety falls
upon, to some degree, the shoulders of American corporations. "Everybody
has a responsibility to national security," said Forman. "It's
easy to point fingers and say this is so-and-so's responsibility.
Individually we can bring a lot to the table, collectively we can
make a major impact."