John Ashcroft's Lucrative New Gig

The FBI and The Telephone
by Christopher Brauchli

Once there was an elephant
Who tried to use the telephant-
No! No! I mean an elephone
Who tried to use the telephone.
-Laura Elizabeth Richards, Eletelphony

It’s only money. And when most of your effort is devoted to making sure that the country is safe from terrorists it’s easy to see how keeping track of money can just be the straw that breaks the camel’s back. And it’s doubly annoying that whenever there’s the slightest hiccoughing in your financial affairs it becomes national news, as if no one else ever has trouble keeping track of money. It would not be surprising if the Justice Department decided to become secretive about its affairs in order to keep trivia about its finances off the front pages.

In January 2005 the revelation was that the FBI had just discovered that it had made a $170 million mistake on something known as the Virtual Case File that had been in development for 5 years. Its purpose was to create a system that would let FBI agents share information. Describing the need for a better system than then existed, Richard Schmitt of the New York Times said: “The overhaul of the decrepit [FBI] computer system was identified as a priority both by the independent commission that investigated the Sept. 11 attacks and by members of Congress, who found that the FBI’s old system prevented agents from sharing information that could have headed off the [9/11] attacks.” When information about this misfortune became public, the FBI hired an expert for $2 million to tell it what went wrong and to tell it whether it was a total loss or whether part of the system could be salvaged.

Although the publicity might have led the casual reader to think the whole thing was an unmitigated disaster, a senior FBI official saw the sunny side. He told reporters that the FBI “had a better understanding of its computer needs and limitations as a result of the project” and described the lessons learned as “invaluable.” The last reference was, of course, a poor choice of words since the value of the lesson learned was exactly $170 million.

The FBI is again in the news, not because it has deterred a savage terrorist attack but because it has misplaced its phone bills and, as a result, some of its phones have been disconnected thus compromising some of its investigations. Here’s how it all happened,

Back in 2006 an employee at the FBI pled guilty to stealing more than $25,000 that was supposed to be used to pay phone bills incurred by the FBI for undercover telecommunication services. As a result, the Office of the Inspector General began an investigation into how the FBI was keeping track of money it used to pay its phone bills. (It doesn’t call them phone bills. It calls them “confidential case funds intended for undercover telecommunication services.”) The investigation produced a report about non-payment of phone bills that is 87 pages long but much of it is confidential so the only thing the average reader gets to see is a 5 page summary and all my readers get to see is a few hundred word description of a small part of the 5 page summary. (Readers who want to read the whole thing can find it online.)

Under the heading “The FBI lacks an Effective Confidential Case Fund Financial Management System” it reported that there are no internal controls to make sure the same phone bill isn’t paid twice-once from FBI headquarters funds and again from certain confidential funds. It found that “the lack of strong system controls-coupled with interpersonal professional relationships that invariably develop over time-increases the risk that field division confidential case funds can be misused.” They got that right, of course, as the convicted employee would attest.

Another heading is entitled “The FBI Pays Telecommunication Surveillance Expenses Inefficiently and Untimely.” The Inspector General reported that it analyzed 990 telecommunication surveillance payments “made by 5 field divisions and. . . over half of these payment were not made on time.” The report then observes that as a result of that, phone lines were disconnected and evidence was lost. In one case the lost evidence pertained to intercept information that was required by a Foreign Intelligence Surveillance Act order. When the phone line went dead there was no more eavesdropping on that line. Another example offered by the report was $66,000 in unpaid telephone bills sent to one of the field divisions examined by the Inspector General.

The Justice Department was embarrassed by these disclosures. I’m sure we can be confident of one thing, however. The Justice Department has just hired John Ashcroft’s firm to monitor a settlement entered into by a firm that settled criminal proceedings without going to court. Mr. Ashcroft’s firm got the job with no public notice and no bidding. His contract is reportedly worth somewhere between $28 million and $52 million.” John Ashcroft is no telephone company. It is safe to assume he will be paid on time.


Christopher Brauchli; brauchli.56@post.harvard.edu. For political commentary see his web page, humanraceandothersports.com.

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