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CNN Presents

Encore Presentation: Al Qaeda -- The New Threat

Aired February 15, 2003 - 20:00 ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

ANNOUNCER: This is CNN PRESENTS.
(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Let's go man. Hurry up!

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ANNOUNCER: Who's winning the war on terror? More than a year after the U.S. assault on Afghanistan, the primary target, the al Qaeda terrorist network, reemerges with a new structure and new tactics, but the same deadly goal.

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PETER BERGEN, CNN TERRORISM ANALYST: I call it al Qaeda 2.0.

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ANNOUNCER: The man at the heart of al Qaeda, Osama bin Laden, remains at large.

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BOB WOODWARD, AUTHOR, "BUSH AT WAR": The fact that Osama bin Laden has eluded perhaps the most determined manhunt in the history of known civilization is quite astonishing.

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ANNOUNCER: How did he get away and is he communicating with his forces in the field?

(BEGIN VIDEO CLIP)

MAGNUS RANSTORP, ST. ANDREWS UNIVERSITY: To hear from the great leader, that would be an incredible morale booster and then, they activate cells.

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ANNOUNCER: Could those sleeper cells be in the United States? Can law enforcement stop them?

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ROBERT MUELLER, FBI DIRECTOR: There are a number of individuals in the United States who are sympathizers.

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ANNOUNCER: And what about the tactics in this war on terror?

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ANSER MEHMOOD: I heard somebody telling me to keep your mouth shut; otherwise you'll be dead.

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ANNOUNCER: Are civil liberties one of the casualties?

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MARTIN STOLAR, ANSER MEHMOOD'S ATTORNEY: It turns the presumption of innocence on its head.

(END VIDEO CLIP)

ANNOUNCER: All ahead in this special report, AL QAEDA: THE NEW THREAT.

JEANNE MESERVE, CNN CORRESPONDENT: America is on high alert, specific and credible new threats from al Qaeda leads to fears of another massive terrorist attack here at home, all of this as the nation stands on the verge of a possible war with Iraq.

Welcome to this special edition of CNN PRESENTS. I'm Jeanne Meserve.

Citing intelligence reports and an increase in chatter among al Qaeda operatives, the Bush administration is warning that al Qaeda may be planning immediate chemical, biological, or radioactive strikes against lightly guarded targets here in the U.S.

It's an alarming revelation that suggests Osama bin Laden's terror network has survived the U.S. assault on Afghanistan and continues to evolve, to learn and adapt. Over the next hour we look at the new al Qaeda, its new technology, and its new tactics.

We begin with CNN national correspondent Mike Boettcher.

(BEGIN VIDEOTAPE)

MIKE BOETTCHER, CNN NATIONAL CORRESPONDENT (voice-over): Ocean City, Maryland, where American unwound this summer, some sun and fun to escape the shadow of terrorism. Ocean City of all places, a new front in the war on the new al Qaeda.

(on camera): So this is where you work?

UNIDENTIFIED MALE: Yes.

BOETTCHER (voice-over): It's where John Mesner (ph) commands a keyboard as he tracks the group through cyberspace. Mesner (ph) is an Internet entrepreneur, runs an Internet service provider and several adult Web sites. But since 9/11, he discovered something else on the Internet, al Qaeda.

UNIDENTIFIED MALE: I know the Internet, so I made it my business at that time to do anything and everything I could within my power to disrupt the communication on the terrorists who are on the Internet, just jam it, just do anything I could.

BOETTCHER: The most visible face of the new al Qaeda has been this Web site. It first popped up in February and has been on and off the web since then. It's called Alneda, The Call, run ostensibly by a group called the Institute For Research and Islamic Studies, but it carries communiques in the name of al Qaeda and claims credit for terrorist attacks.

(on camera): You had hijacked it basically and they didn't know...

UNIDENTIFIED MALE: Right.

BOETTCHER: ... that you actually had their site.

UNIDENTIFIED MALE: Right.

BOETTCHER (voice-over): From his couch in Ocean City, Maryland, he was able to bring some of al Qaeda's operations to a halt for a few days this summer, by hijacking their Web site, posting his own decoy and running traces on all the computer traffic.

UNIDENTIFIED MALE: These are all hostile message boards. What I got was a virtual who's who of every hostile message board and Web site on the Internet.

BOETTCHER: Mesner (ph) tried to interest the FBI, but made little headway. Now, a number of intelligence agencies are searching for al Qaeda in cyberspace.

(on camera): Al Qaeda on the Internet, fighting a cyber war. It's just one of the ways the group has remade itself after 9/11 and after the U.S. attacks on Afghanistan took away its operating bases.

(voice-over): Terrorism expert, Peter Bergen, uses a computer metaphor to describe the new al Qaeda.

BERGEN: I call it al Qaeda 2.0 because it's a group that is much more virtual than it's previous existence. I mean before it had a physical headquarters, training camps. These are gone.

BOETTCHER: The new al Qaeda, this al Qaeda 2.0 is more than a Web site and the plans to put it in place began even before 9/11 as hundreds of al Qaeda fighters slipped out of Afghanistan and moved around the world to places like Yemen.

Rohan Gunaratna is the author of "Inside al Qaeda." ROHAN GUNARATNA, AUTHOR, "INSIDE AL QAEDA": Before the U.S. troops attacked Afghanistan in October 2001, already al Qaeda has had decentralized.

BOETTCHER: Several hundred at least slipped through the most guarded and well known route, east into Pakistan, where sources say al Qaeda members have found ready sanctuary. But many fled through two secret backdoors, west to Iran, according to CNN sources, facilitated by Iran's radical Revolutionary Guard. Some remain there and some moved on to Lebanon. Others dispersed east and west to destinations unknown.

Another back door opened south, approximately 1,000 al Qaeda operatives using false identification made their way from Afghanistan to the tiny Indian Ocean island of Seychelles and the Federal Islamic Republic of the Comoros where they again dispersed east and west.

By March, the new al Qaeda began to regroup. The high command somewhere along the Pakistan/Afghanistan border and a second tier group reorganized into regional commands.

GUNARATNA: We are seeing that al Qaeda dispatching some of its key operatives into Southeast Asia, into the Middle East, into the Caucuses, into the heart of Africa, so that they could conduct their operations using those regions as their main staging areas.

BOETTCHER: The new marching orders from Osama bin Laden -- work with local groups, form super cells, attack local targets, soft ones with an economic value, focus on America and its allies, especially tourist sites.

BERGEN: If I was running McDonald's in Pakistan right now, I'd be very concerned or any kind of obvious symbol of the United States, Kentucky Fried, American Express, because when the leaderships say the same thing, to attack American economic targets, those statements have been a very reliable guide to what actually happens next.

BOETTCHER: But there have been setbacks, planned attacks against U.S. and British ships in the Straits of Gibraltar were thwarted after a Moroccan cell was exposed. The head of the Persian Gulf military command was captured. A missile attack killed a man said to be al Qaeda's leader in Yemen.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The only way to treat him is what they are, international killers. And the only way to find them is to be patient and steadfast and hunt them down. And the United States of America is doing just that.

BOETTCHER: But al Qaeda has achieved successes all over the world. In Tunisia, where a synagogue was bombed in April and at least 18 were killed, including German tourists. In Karachi, in May, French military engineers were killed when a bus was bombed. And attacks on U.S. Marines in Kuwait and a French oil tanker off the coast of Yemen.

In Bali, almost 200 died when a nightclub was attacked. In Kenya, an Israeli owned hotel was bombed. Missiles shot at an Israeli charter just missed the plane. Each time, it had the propaganda victory or a new threat. Al Qaeda uses the Internet to spread the word.

BERGEN: It's the way they take credit for operations at this point. And it's a way they communicate.

BOETTCHER: Including this proof of life from Osama bin Laden in November, warning of worse to come.

OSAMA BIN LADEN, AL QAEDA TERRORIST (through translator): Just as you kill, you will get killed. And just as you shell, you will get shelled. Await then what will desman.

BOETTCHER: Within two days of its first airing on Al Jazeera, bin Laden's audio recording was posted on the Alneda Web site and just so the message was clear, this time al Qaeda posted its own English translation.

The real message -- "Osama bin Laden is still alive. And to stop al Qaeda, he has to be found."

(END VIDEOTAPE)

MESERVE: Coming up on CNN PRESENTS, the hunt for bin Laden in hostile territory.

(BEGIN VIDEO CLIP)

KAMAL HYDER, JOURNALIST: They do not seem him as a criminal. They see him as a fighter who is fighting for a cause.

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(COMMERCIAL BREAK)

MESERVE: Osama bin Laden's terrorist network is definitely up and running. As for the al Qaeda leader himself, well, that's another matter. Up until recently, many officials and experts had said that bin Laden was probably dead, but a new audiotape suggests otherwise. It also raises a number of questions, where is Osama bin Laden, why is he still at large and what's being done to hunt him down. Here again, CNN national correspondent, Mike Boettcher.

(BEGIN VIDEOTAPE)

BOETTCHER (voice-over): The men, Bravo Company, 2nd Battalion, 187th Infantry, 101st Airborne.

UNIDENTIFIED MALE: OK, Bravo Company, and let me tell you something you going on a real world combat mission. Don't let anybody tell you it's not.

BOETTCHER: The objective, a mountain path in Afghanistan. The goal -- capture, if necessary -- kill suspected al Qaeda members. One hundred fifty men chasing 20, hoping success will eventually lead to one other, Osama bin Laden. BUSH: I want justice.

BOETTCHER: Right after 9/11, President Bush made bin Laden the world's most wanted man.

BUSH: There's an old poster out west, as I recall, that said, "Wanted: Dead or Alive."

BOETTCHER: But after 15 months, the man with a $25 million bounty on his head remains a fugitive. Why? Bravo Company's assault provides a telling answer. The information that had pointed to the al Qaeda camp was up-to-date but not up to the minute. When Bravo Company arrived, the camp was empty, the caves, deserted. All Bravo Company could do...

UNIDENTIFIED MALE: Twenty packages of C-4 taped together.

BOETTCHER: ... was make sure nobody came back. The mission was the victim of what terrorism experts call hypermobility, the low-tech stealth that helps bin Laden evade high-tech spies.

RANSTORP: He will not be traveling in large convoys. It'll be picked up on satellite.

BOETTCHER: Magnus Ranstorp of Scotland's University of St. Andrews is a leading authority on terrorism.

RANSTORP: It's a virtual nightmare to try to find him given the global reach al Qaeda has. And al Qaeda of course exists in over 98 countries around the world.

BOETTCHER: A year ago, the American led forces almost had their man. They captured the Afghan city of Kandahar, a major al Qaeda stronghold. But bin Laden had retreated to the Tora Bora Mountains, a natural fortress near the Pakistan border.

An al Qaeda member later described the ensuing battle on a Web site frequently used by the group. Intelligence sources consider his account of a precision-guided bomb hitting bin Laden's bunker were lies.

UNIDENTIFIED MALE: Nothing was left but a big hole and pieces of dead bodies. Was Osama killed? Allah kept Osama bin Laden alive because he left the bunker only two nights before and moved to an area only 200 meters away.

BOETTCHER: In a videotape released a few days later, bin Laden appeared tired, frail, weak. He never moved his left arm. Intelligence experts believed bin Laden's left shoulder had required surgery, that he had at least been injured at Tora Bora. But from there, he vanished.

RANSTORP: I don't think the intensity of that search was adequate. And I think that there was a real possibility, the closest one we had, in actually capturing him. BOETTCHER: Many experts believe bin Laden is hiding in Afghanistan or perhaps slipped across the border into Pakistan's northwest territories.

HYDER: And you cannot seal a border with mountainous terrain.

BOETTCHER: Pakistan-based journalist, Kamal Hyder, is one of the few outsiders who have recently toured this remote area.

HYDER: People are there who support Osama bin Laden, who support his point-of-view. And yes, they would give their dues for this man if he was to come to their houses. They do not seem him as a criminal. They see him as a fighter who is fighting for a cause.

BOETTCHER: Only a handful of American operatives are there, CIA, FBI, military commandos. But the hunt for bin Laden is so politically sensitive, it's largely conducted by Pakistani forces. Even so, it's a challenge because the leaders of the local tribes carry more authority than the simple government.

HYDER: It is with quite difficulty that the Pakistan army has taken control of this region for the first time. If you introduce American forces, you are talking of a spillover from Afghanistan because the American forces will be seen more as an occupation force in the tribal area and then, the chances of a major revolt against American forces spreading into Pakistan cannot be ruled out.

BOETTCHER: For nearly a year, there was no public sign of bin Laden. Several officials, including Afghanistan's president, were optimistic.

HAMID KARZAI, PRESIDENT, AFGHANISTAN: The latest that I can think of is that the more time passes and we don't hear from of him in any form, I would come to believe that he probably is dead.

BOETTCHER: A few weeks later, bin Laden's spoke, a voice on an audiotape believed by coalition intelligence analysts to be bin Laden's, claimed credit for a host of recent terrorist attacks.

RANSTORP: To hear from the great leader, that would be an incredible morale booster and that may activate cells, sleeper cells, in the United States or elsewhere to undertake new operations.

BOETTCHER: As the hunt continued for al Qaeda foot soldiers and field commanders, the U.S. still wants Osama bin Laden dead or alive. He's the symbol of worldwide Jihad and in the war on terrorism, much more than just one man.

(END VIDEOTAPE)

MESERVE: When we come back, the intelligence war against al Qaeda -- secrets from the interrogation room.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It's a great stress relief to throw a chair against the wall and smash it into a hundred pieces and see someone's eyes balloon out.

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(COMMERCIAL BREAK)

MESERVE: It's been said time and time again; the war on terrorism is like no other. It certainly is being fought like no other. This is a war dominated by covert ops and secret interrogations where the true front lines aren't battlefields, but city streets and open tracks of desert. As CNN national security correspondent, David Ensor, reports this is the CIA's war.

(BEGIN VIDEOTAPE)

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): A shootout in downtown Karachi in September, between Pakistani police and al Qaeda militants, led to the capture of this very important prisoner, Ramzi Binalshibh, who was led away blindfolded. He's a key 9/11 plotter, U.S. officials say. He would have been one of the hijackers if he'd been able to get a U.S. visa. Now, he is in the hands of the U.S. Central Intelligence Agency.

COFER BLACK, FORMER DIRECTOR, CIA COUNTER TERRORIST CENTER: After 9/11, the gloves come off. Nearly, 3,000 al Qaeda and their supporters have been arrested or detained.

ENSOR: But Binalshibh is a much more select group of senior al Qaeda prisoners, including Aby Zubaydah, Omar al Faruk (ph), Abdel Rahim al Nashiri (ph). Some of bin Laden's top henchmen, U.S. officials say.

(on camera): They and others unnamed are under interrogation by the CIA in undisclosed locations around the world. Torture is not used by the United States and CIA officials refuse to discuss how they get information out of captives. But such prisoners may no longer know whether it's day or night.

(voice-over): For his latest book, author, Bob Woodward, talked to CIA officers in depth about the intelligence war.

WOODWARD: One technique is to not have them be interrogated by the CIA or the U.S. military, but to let the foreign intelligence service and say, Egypt, conduct the interrogation.

ENSOR: Sometimes, just the threat of being turned over to Egypt or Saudi Arabia is enough, sources say, to get a man talking. As for prisoners held and questioned in Afghanistan, one U.S. military interrogator, who declined to be identified, told how he got some of them to talk.

UNIDENTIFIED MALE: You would be amazed at what a kind word and a cup of hot cocoa on a 15-degree night will get you as far as information. Now, there's other ones that, you know, just want to be obstinate and it's a great stress relief to throw a chair against a wall and smash into a 100 pieces and see someone's eyes balloon out. But you have to be able to talk to them and figure out which buttons to push on that particular person.

ENSOR: The U.S. has thousands of prisoners, but it does not have the most important one of all, Osama bin Laden. About him, Woodward says, "The head of CIA Counter Terrorism gave these chilling orders..."

WOODWARD: "I want you to bring bin Laden's head back in a box. I want to take it in that box and show it to the president -- to President Bush to show that we had done what he said, what he authorized us to do."

ENSOR (on camera): It hasn't worked though, has it? They don't have bin Laden. They don't have several of the top leaders of al Qaeda.

WOODWARD: The fact that Osama bin Laden has eluded perhaps the most well financed and most determined manhunt in the history of known civilization is quite astonishing. It's a mixed record of success and failure, but in terms of what's important and that is that there's not been another major attack against the homeland, that is a big plus.

ENSOR (voice-over): No major attack against the U.S. or U.S. facilities overseas since 9/11, quite an achievement. What keeps director of Central Intelligence, George Tenet, awake at night is trying to keep it that way.

GEORGE TENT, CIA DIRECTOR: We are still in the hunt phase of this war, the painstaking pursuit of individual al Qaeda members and their cells. This phase is paying off, but it is intensive and it will take a long time.

ENSOR: They're doing everything they can think of, even attacking al Qaeda from the air last month. A senior leader died in his car in Yemen, hit by a hellfire missile fired from a CIA run unmanned predator drone.

But the key to stopping the next al Qaeda attack may well be infiltrating the organization. For U.S. intelligence, there's no greater challenge.

BERGEN: Culturing the sort of people who work in these agencies aren't the sort of people who can really penetrate al Qaeda. I mean, just to pass a background check to become, you know, in the CIA would preclude anybody who probably -- who could penetrate the group. So you know, it's sort of in a catch-22.

ROBERT BAER, FORMER CIA OFFICER: You can't take people from suburban Chicago or wherever they're coming from or suburban Los Angeles, bring them to Washington and dump this stuff on their desks and say, "Tell me what this means." We have a very -- it's a problem of experience.

ENSOR: Even if U.S. intelligence cannot directly infiltrate al Qaeda, it may still be able to get some information for money. About $70 million from the CIA, mostly in cash, money to buy off warlords and informers, was critical to overthrowing the Taliban in Afghanistan.

The overall intelligence budget is classified. But under this president, it is clearly growing fast.

WOODWARD: Bush, in the discretionary accounts of the CIA, has given the agency about $1 billion more.

ENSOR: President Bush is giving the CIA a lot of money but he expects results.

(on camera): Does he still keep that list in his top drawer that everyone's heard of?

WOODWARD: I understand he does. If somebody is apprehended, a leading terrorist, or killed, he marks an "X" through their picture. It's not just a list. It's with photos.

ENSOR (voice-over): The president is keeping score.

(END VIDEOTAPE)

MESERVE: Next on CNN PRESENTS, the threat at home. Can the FBI get the bad guy?

(BEGIN VIDEO CLIP)

SEN. PATRICK LEAHY, JUDICIARY COMMITTEE CHAIRMAN: They have got to make sure that this is the number one priority and I'm not convinced it is.

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(COMMERCIAL BREAK)

MESERVE: Al Qaeda may have scattered after the fall of Afghanistan, but its reach is no less global. Osama bin Laden's agents may be operating in as many as five-dozen countries, including the United States. And that is where the Justice Department and the FBI come in. It is their job to uncover suspected sleeper cells to route out terrorists at home, to prevent any potential attacks. But are they up to the job? CNN justice correspondent, Kelli Arena, went to FBI director, Robert Mueller, for some answers.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): Not much about this former steel town in upstate New York betrays its significant Arab-American population. Muslims who live in Lolowana (ph) assimilated generations ago. So it was a shock to the community when back in September, FBI agents accused six of its sons of training in an al Qaeda terror camp in Afghanistan and being part of a sleeper cell here in the United States.

One of the accused is 25-year-old Yessin Teher, a former high school soccer player and homecoming king. His attorney, Rodney Personius, denies Teher is a terrorist. RODNEY PERSONIUS, LAWYER FOR YESSIN TEHER: As far as what gave rise to his travel overseas, as much as anything else, I think it was a combination perhaps of being inquisitive with respect to his religion and I suspect to some degree also being a bit gullible.

ARENA: The other suspects have also denied the charges. While heralding the arrests, FBI director, Robert Mueller, did admit at the time that there was no evidence the Locowana (ph) six were planning an attack.

MUELLER: We have not seen any plans of an imminent attack.

ARENA: Still, Mueller says, such arrests are vital in the war on terror.

MUELLER: Now, people will say, "Well, how do you know an individual is a terrorist?" And then, of course, you'd like to find an individual with guns, weapons or explosives. But if you look at the suicide attackers of September 11, they had box cutters and a plan and that was it.

ARENA: The FBI has also closed in on other alleged terrorist sleeper cells in Portland and Detroit, and arrested a Seattle man who alleged tried to set up a terrorist camp in Blye, Oregon. All say they're innocent.

Some terror analysts suggest the government is wasting its time on terrorist wanna-be's.

JULIETTE KAYYEM, JOHN F. KENNEDY SCHOOL OF GOVERNMENT: Do we really think that they are key players in al Qaeda? No. I mean the Justice Department's not even alleging that. Do we think that they're arrests are going to; you know, disrupt or undermine any potential series attacks? Likely not.

ARENA: The head of the criminal division at the Justice Department argues that not taking these types of individuals into custody could prove dangerous.

MICHAEL CHERTOFF, U.S. DEPARTMENT OF JUSTICE: If we actually have a situation where we arrest someone in the face of imminent attack, in some ways, we haven't done our job. It should never really get to the point of the last minute.

ARENA: Sources tell CNN the FBI has under surveillance at least 200 individuals with possible terror ties as well as several mosques.

MUELLER: There are a number of individuals in the United States who are sympathizers. There are a number of individuals in the United States who are supporters. And there are a number of individuals in the United States who funnel money into terrorist -- well, charitable organizations that fund terrorists.

ARENA (on camera): The war on terror has cast the FBI in a new role. It is a seat change for the bureau's mission from solving crime to preventing terrorist attacks. (voice-over): Some have questioned whether the FBI is up to the job.

LEAHY: They have got to make sure that this is the number one priority and I'm not convinced it is. And I don't think many in the FBI are convinced yet that it is or that their structure is such that they can be.

ARENA: Some critics are proposing the creation of a separate agency to gather domestic intelligence. The idea hasn't gained much transaction and Director Mueller says his agents have what it takes.

MUELLER: I firmly believe that the bureau can and should do the job.

ARENA: The FBI has almost doubled the number of analysts assigned to counter terrorism. And CIA agents are now permanently posted at the FBI to improve communication.

The bureau has moved up the deadline for upgrading its antiquated computer system, but they will not be completely up to par for another year. And the bureau still needs more linguists to translate intelligence.

But the FBI does have new weapons in this war. There are less restrictions on how agents can gather information and the bar for obtaining wiretaps is lower.

Government agents are also employing an aggressive detention and deportation policy of those in the country illegally. What's more, visitors from selected countries, many in the Middle East, undergo special processing and fingerprinting. Arab-American groups say there is no proof such policies work.

IBRAHIM HOOPER, COUNCIL ON AMERICAN ISLAMIC RELATIONS: Terrorists don't come in this way. They know how to get around these kinds of things. If we thought this was an effective means of law enforcement, we'd be all for it. But we think it's counterproductive in that it creates great resentment.

ARENA: Resentment in the Arab-American community at a time the government most needs its help. As the experts point out, terrorists only need to get lucky once.

(END VIDEOTAPE)

MESERVE: When we return, is America's war on terror on Americans?

(BEGIN VIDEO CLIP)

MEHMOOD: I never ever expected that this injustice could happen to me in America.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MESERVE: Terror suspects snatched off the streets, carted off to some undisclosed location, few rights, no lawyers, no contacts. If you're thinking sure, in Yemen perhaps but not here no way, well, that's not what CNN's Brooks Jackson found as he explored the new balance between safety and freedom.

(BEGIN VIDEOTAPE)

BROOKS JACKSON, CNN SENIOR CORRESPONDENT (voice-over): He was a U.S. taxpayer, business owner, homeowner, educating his boys in a New Jersey public school, a hardworking Pakistani immigrant liked by neighbors.

UNIDENTIFIED FEMALE: If you're carrying something and wanted help, yes, he was a very nice man.

JACKSON: But soon after September 11, federal agents swooped down, searched his home and hauled him off to a federal prison, shackled and chained.

MEHMOOD: I heard announced -- somebody telling me that keep your mouth shut, otherwise you'll be dead. Don't ask any questions otherwise you will be dead.

JACKSON: He says they slammed him into a wall, bloodied his mouth, broke his hand, leaving it painfully swollen and untreated. The Justice Department's Inspector General's Office is investigating the handling of Anser Mehmood's case and others. Federal prosecutors won't discuss his case now, but in court, they said they needed to investigate why this Pakistan citizen had an expired visa, a truck license to haul hazardous material, a Swiss bank account and multiple passports.

Mehmood says there are innocent explanations. For example, the Swiss bank account was a joint account with his father. But he says the government never questioned it. They held him in solitary confinement here in Brooklyn, in a tiny cell, with the only window painted black. Lights and cameras on him 24 hours a day.

MEHMOOD: That was mostly -- it was like a grave.

JACKSON: At first, he just disappeared, the kind of thing that happens in other countries not America.

UZMA NAHEED, MEHMOOD'S WIFE: They didn't give me any answers. They didn't tell me where they are being taken him.

UZAIR ANSER, MEHMOOD'S SON: First, we went to a police station and then, she was trying to get the information. Nobody would tell her.

JACKSON: They held him in prison for six months. He lost his home. It's boarded up now, lost his truck, his livelihood. In the end, they charged him only with altering his social security card to remove four words -- not valid for employment -- so he could work. The judge released him immediately. The government deported him back to Pakistan.

STOLAR: It turns the presumption of innocence on its head. It says because you fit a certain profile, you are probably involved in some kind of illegal conduct. And you know that's just not the American way of doing business.

JOHN ASHCROFT, UNITED STATES ATTORNEY GENERAL: This rule change will apply to the 75 individuals who are currently detained. Over 480 people arrested or detained. Six hundred and fourteen persons.

JACKSON: Federal officials stopped counting when the total reached 1, 182. Of all those rounded up in the days after September 11, officials accused only four of being linked to terrorism.

(on camera): If you think what happened here could not happen to an American born citizen, think again. It is happening right now.

ASHCROFT: We have captured a known terrorist.

JACKSON (voice-over): Federal agents arrested Jose Padilla at O'Hare Airport in Chicago last May. He was born in Brooklyn, grew up in Chicago. A U.S. citizen locked up in a Navy brig indefinitely. Padilla is a violent criminal with a prison record.

Federal officials say he spoke with al Qaeda about exploding a radioactive, dirty bomb somewhere in the U.S. But they admit he had no actual bomb material, no specific target, no real plan. Prosecutors turned him over to the Pentagon to be held as a -- quote -- "enemy combatant." No charges, no trial. No access to family or to his lawyer. The president specifically approved.

BUSH: He is now off the streets where he should be.

JACKSON: Scary says a lawyer involved in his case.

KATE MARTIN, PADILLA'S ATTORNEY: And for the U.S. government to take the position that on the say so of the president it can pick up, arrest, and secretly jail in a military brig a U.S. citizen, is truly an extraordinary and dangerous claim.

JACKSON: But Justice Department officials say it's just common sense.

CHERTOFF: Because you can't have people who are allied with the enemy and release them in order to go back up again and continue to carry out attacks against the United States.

JACKSON: This month, a judge said Padilla must be allowed to see his lawyer, a set back for the government. But the judge also said, Padilla's incarceration is legal if the government shows only -- quote -- "some evidence to declare him a combatant for al Qaeda," a very low standard of proof.

Even for law-abiding citizens, privacy is eroding. The FBI now may more easily get national security warrants for library records or any business records under the U.S.A Patriot Act passed after 9/11. ANTHONY ROMERO, AMERICAN CIVIL LIBERTIES UNION: The ordinary, law-abiding American citizens need to be concerned. It's also how the government, after 9/11, has begun to prosecute the war on terror by snooping and piercing and surveilling the lives of law-abiding Americans.

CHERTOFF: Show me the core, fundamental values, which have been sacrificed. In fact, everything that we have done is well within the Constitution and well within the law. And in fact, some people have criticized us for being too modest.

JACKSON: But even some Republican Conservatives say the price is too high.

GROVER NORQUIST, AMERICANS FOR TAX REFORM: What we're fighting for in the war against al Qaeda and the Taliban is for our freedom. That's what we're defending. We need to keep coming back for that. What's great about America is not what color we are, not what religion we are, not what language we speak, it's that we're the country that's the home of freedom.

JACKSON: And even now, living in Pakistan, Mehmood and his family would agree.

MEHMOOD: I never ever expected that this injustice could happen to me in America.

JACKSON: Even now, his sons say every day they tell their father they want to go back.

(END VIDEOTAPE)

MESERVE: Coming up, how secure is the homeland.

(BEGIN VIDEO CLIP)

STEPHEN FLYNN, COUNCIL ON FOREIGN RELATIONS: We are dangerously unprepared right now to prevent a terrorist attack and to respond capably to one if it happens.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

MESERVE: The terrorist attacks of September 11, 2001 laid bare this nation's vulnerabilities. Fifteen months later, it's reasonable to ask is it any safer. And the answer is yes to a point. Experts say much more needs to be done. In fact, a recent report from the Hart- Rudman Commission found the nation is dangerously unprepared and is lapsing back into complacency.

Tom Ridge, who will head the new Department of Homeland Security, says the key to protecting the country rests in the cities and towns across America. And so, we visited one, Niagara Falls, New York, to be exact, to see what was happening and what was not.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): Even on a brittle, cold morning, the thundering beauty of Niagara Falls draws tourists. Could it draw terrorists too? Because of its crowds and landmark status, city officials fear it could and experts say this city and every other is vulnerable.

FLYNN: We are dangerously unprepared right now to prevent a terrorist attack and to respond capably to one if it happens.

MESERVE: The Niagara River switchbacks its way from Lake Erie to Lake Ontario, separating the U.S. and Canada. The city of Niagara Falls perched here, right on the border, presents special concerns.

Since the September 11 attacks, the Customs Service and the Immigration and Naturalization Service has stepped up their policing of the three international border crossings in the city. But what about the stretches of river between those bridges?

(on camera): Canada is to my right, the U.S. to my left. At some point, the shores are only about 100 yards apart. People and goods are smuggled across all the time and the fear is that some day it will be terrorists and weapons of mass destruction.

What time of day or time of year do people tend to cross?

UNIDENTIFIED MALE: All times. It really is all times.

MESERVE (voice-over): It is the task of the U.S. Border Patrol to catch whoever is bold or desperate or fool hardy enough to try to cross. Since 9/11, it has doubled its manpower here. Its helicopters swoop through the sky watching for suspicious vessels, activities, people. Surveillance cameras do the same, swinging to and fro day and night. The images monitored from afar.

This day, a suspicious boat is spotted and agents are dispatched to investigate.

UNIDENTIFIED MALE: Ten four, we'll do it.

MESERVE: They find a fishing boat. Border Patrol agents on the ground check it out.

UNIDENTIFIED MALE: Yes, (UNINTELLIGIBLE), is he local?

UNIDENTIFIED MALE: Affirmative.

MESERVE: Nothing out of order here, but in the past year, along a 10-mile stretch of river, the Border Patrol nabbed 400 people trying to enter the U.S. illegally, including this man. An infrared camera picked him up crossing a railroad bridge carrying $150,000 worth of marijuana.

(on camera): Do you think you're coming near to catching all of the people that are coming across? MIKE RUSSELL, U.S. BORDER PATROL: I would say no. It's too easy of an area to cross. It doesn't matter how many people you have, it's just a difficult area to control completely.

MESERVE: Who was getting in the country is one concern. What they could do is another. City councilman, Paul Dyster, heads Niagara Falls homeland security efforts

PAUL DYSTER, NIAGARA FALLS CITY COUNCIL: It's a little nerve- wracking not knowing exactly who's, you know, lurking in the bushes on the other side of the river when you've got the hydroelectric facility sitting there, located right on the border.

MESERVE: This, the largest generating plant in New York State, has been identified by city officials as a potential target, another, the plant's reservoir. If it were breached, much of the city could be flooded, including the chemical plants, which are the industrial backbone of this community.

City officials say the chemical industry has improved security in the last 15 months. There are more fences, more cameras, more guards, but...

DYSTER: These factories are older factories. In many cases, they're downsizing. They're not looking to reinvest huge amounts of money in these facilities. And it makes it difficult, you know, to justify maybe sometimes a lot of really expensive security measures.

MESERVE: Produced in these plants, some of the most toxic chemicals, including chlorine. After manufacture, they are shipped by rail. Loaded tank cars move throughout the city. There is, in short, a lot to protect.

DYSTER: Is it as safe as it could be? No, it's not. Is there a reason why it's not as safe as it could be? Well, there is and it's the obvious reason of dollars.

MESERVE: As jobs have moved elsewhere, the city's population has dwindled. Half of those who remain are on some form of government assistance. The declining tax base has brought a fiscal crisis so severe that despite homeland security demands, 14 police officers and a dozen firefighters had been cut since 9/11.

The city's emergency equipment is old. And despite, the heavy presence of the chemical industry, the city has only one hazardous materials truck. It just got its first top of the line HAZMAT suits, but only half a dozen. And the city doesn't have enough cash to train firefighters to use them.

WILLIAM CORREA, NIAGARA FALLS FIRE CHIEF: Four to six suits may be able to handle some type of tractor trailer incident or a small leak in a heavy rail car, things of that nature. It is not going to begin to address something on a grand scale relative to terrorism. It's not even going to begin to.

MESERVE: Niagara Falls has tried to something with nothing. For instance, old construction barricades have been recycled and repositioned to deter truck bombers. Paul Dyster says even an infusion of $100,000 would be a big boost, but the city hasn't seen a cent in homeland security funds from the federal government.

DYSTER: If you had told me a month after the attack that now a year-and-a-half later, we'd still be waiting for the first federal dollar to get here, I would not have believed that that was possible.

MESERVE: Besides New York and Washington D.C., no cities have received significant homeland security funds according to the National League of Cities.

Homeland security expert, Stephen Flynn, says with state and local budgets stretched, the federal government must put its money where its mouth is.

FLYNN: The federal government must take the lead in providing the resources and providing the leadership to help communities like Niagara Falls be able to protect themselves and in so doing protect the broader nation.

MESERVE: Failure to do so, say the experts, may mean another attack is as inevitable as water going over the falls.

(END VIDEOTAPE)

MESERVE: Sixteen months after losing its stronghold in Afghanistan, al Qaeda's reach is no less global and its threat no less alarming. As the U.S. military now focuses on Iraq, a new al Qaeda, reconstituted and high tech, is still at large and on the attack.

That's it for this special edition of CNN PRESENTS. I'm Jeanne Meserve. Thanks for joining us.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

Aired February 15, 2003 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: This is CNN PRESENTS.
(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Let's go man. Hurry up!

(END VIDEO CLIP)

ANNOUNCER: Who's winning the war on terror? More than a year after the U.S. assault on Afghanistan, the primary target, the al Qaeda terrorist network, reemerges with a new structure and new tactics, but the same deadly goal.

(BEGIN VIDEO CLIP)

PETER BERGEN, CNN TERRORISM ANALYST: I call it al Qaeda 2.0.

(END VIDEO CLIP)

ANNOUNCER: The man at the heart of al Qaeda, Osama bin Laden, remains at large.

(BEGIN VIDEO CLIP)

BOB WOODWARD, AUTHOR, "BUSH AT WAR": The fact that Osama bin Laden has eluded perhaps the most determined manhunt in the history of known civilization is quite astonishing.

(END VIDEO CLIP)

ANNOUNCER: How did he get away and is he communicating with his forces in the field?

(BEGIN VIDEO CLIP)

MAGNUS RANSTORP, ST. ANDREWS UNIVERSITY: To hear from the great leader, that would be an incredible morale booster and then, they activate cells.

(END VIDEO CLIP)

ANNOUNCER: Could those sleeper cells be in the United States? Can law enforcement stop them?

(BEGIN VIDEO CLIP)

ROBERT MUELLER, FBI DIRECTOR: There are a number of individuals in the United States who are sympathizers.

(END VIDEO CLIP)

ANNOUNCER: And what about the tactics in this war on terror?

(BEGIN VIDEO CLIP)

ANSER MEHMOOD: I heard somebody telling me to keep your mouth shut; otherwise you'll be dead.

(END VIDEO CLIP)

ANNOUNCER: Are civil liberties one of the casualties?

(BEGIN VIDEO CLIP)

MARTIN STOLAR, ANSER MEHMOOD'S ATTORNEY: It turns the presumption of innocence on its head.

(END VIDEO CLIP)

ANNOUNCER: All ahead in this special report, AL QAEDA: THE NEW THREAT.

JEANNE MESERVE, CNN CORRESPONDENT: America is on high alert, specific and credible new threats from al Qaeda leads to fears of another massive terrorist attack here at home, all of this as the nation stands on the verge of a possible war with Iraq.

Welcome to this special edition of CNN PRESENTS. I'm Jeanne Meserve.

Citing intelligence reports and an increase in chatter among al Qaeda operatives, the Bush administration is warning that al Qaeda may be planning immediate chemical, biological, or radioactive strikes against lightly guarded targets here in the U.S.

It's an alarming revelation that suggests Osama bin Laden's terror network has survived the U.S. assault on Afghanistan and continues to evolve, to learn and adapt. Over the next hour we look at the new al Qaeda, its new technology, and its new tactics.

We begin with CNN national correspondent Mike Boettcher.

(BEGIN VIDEOTAPE)

MIKE BOETTCHER, CNN NATIONAL CORRESPONDENT (voice-over): Ocean City, Maryland, where American unwound this summer, some sun and fun to escape the shadow of terrorism. Ocean City of all places, a new front in the war on the new al Qaeda.

(on camera): So this is where you work?

UNIDENTIFIED MALE: Yes.

BOETTCHER (voice-over): It's where John Mesner (ph) commands a keyboard as he tracks the group through cyberspace. Mesner (ph) is an Internet entrepreneur, runs an Internet service provider and several adult Web sites. But since 9/11, he discovered something else on the Internet, al Qaeda.

UNIDENTIFIED MALE: I know the Internet, so I made it my business at that time to do anything and everything I could within my power to disrupt the communication on the terrorists who are on the Internet, just jam it, just do anything I could.

BOETTCHER: The most visible face of the new al Qaeda has been this Web site. It first popped up in February and has been on and off the web since then. It's called Alneda, The Call, run ostensibly by a group called the Institute For Research and Islamic Studies, but it carries communiques in the name of al Qaeda and claims credit for terrorist attacks.

(on camera): You had hijacked it basically and they didn't know...

UNIDENTIFIED MALE: Right.

BOETTCHER: ... that you actually had their site.

UNIDENTIFIED MALE: Right.

BOETTCHER (voice-over): From his couch in Ocean City, Maryland, he was able to bring some of al Qaeda's operations to a halt for a few days this summer, by hijacking their Web site, posting his own decoy and running traces on all the computer traffic.

UNIDENTIFIED MALE: These are all hostile message boards. What I got was a virtual who's who of every hostile message board and Web site on the Internet.

BOETTCHER: Mesner (ph) tried to interest the FBI, but made little headway. Now, a number of intelligence agencies are searching for al Qaeda in cyberspace.

(on camera): Al Qaeda on the Internet, fighting a cyber war. It's just one of the ways the group has remade itself after 9/11 and after the U.S. attacks on Afghanistan took away its operating bases.

(voice-over): Terrorism expert, Peter Bergen, uses a computer metaphor to describe the new al Qaeda.

BERGEN: I call it al Qaeda 2.0 because it's a group that is much more virtual than it's previous existence. I mean before it had a physical headquarters, training camps. These are gone.

BOETTCHER: The new al Qaeda, this al Qaeda 2.0 is more than a Web site and the plans to put it in place began even before 9/11 as hundreds of al Qaeda fighters slipped out of Afghanistan and moved around the world to places like Yemen.

Rohan Gunaratna is the author of "Inside al Qaeda." ROHAN GUNARATNA, AUTHOR, "INSIDE AL QAEDA": Before the U.S. troops attacked Afghanistan in October 2001, already al Qaeda has had decentralized.

BOETTCHER: Several hundred at least slipped through the most guarded and well known route, east into Pakistan, where sources say al Qaeda members have found ready sanctuary. But many fled through two secret backdoors, west to Iran, according to CNN sources, facilitated by Iran's radical Revolutionary Guard. Some remain there and some moved on to Lebanon. Others dispersed east and west to destinations unknown.

Another back door opened south, approximately 1,000 al Qaeda operatives using false identification made their way from Afghanistan to the tiny Indian Ocean island of Seychelles and the Federal Islamic Republic of the Comoros where they again dispersed east and west.

By March, the new al Qaeda began to regroup. The high command somewhere along the Pakistan/Afghanistan border and a second tier group reorganized into regional commands.

GUNARATNA: We are seeing that al Qaeda dispatching some of its key operatives into Southeast Asia, into the Middle East, into the Caucuses, into the heart of Africa, so that they could conduct their operations using those regions as their main staging areas.

BOETTCHER: The new marching orders from Osama bin Laden -- work with local groups, form super cells, attack local targets, soft ones with an economic value, focus on America and its allies, especially tourist sites.

BERGEN: If I was running McDonald's in Pakistan right now, I'd be very concerned or any kind of obvious symbol of the United States, Kentucky Fried, American Express, because when the leaderships say the same thing, to attack American economic targets, those statements have been a very reliable guide to what actually happens next.

BOETTCHER: But there have been setbacks, planned attacks against U.S. and British ships in the Straits of Gibraltar were thwarted after a Moroccan cell was exposed. The head of the Persian Gulf military command was captured. A missile attack killed a man said to be al Qaeda's leader in Yemen.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The only way to treat him is what they are, international killers. And the only way to find them is to be patient and steadfast and hunt them down. And the United States of America is doing just that.

BOETTCHER: But al Qaeda has achieved successes all over the world. In Tunisia, where a synagogue was bombed in April and at least 18 were killed, including German tourists. In Karachi, in May, French military engineers were killed when a bus was bombed. And attacks on U.S. Marines in Kuwait and a French oil tanker off the coast of Yemen.

In Bali, almost 200 died when a nightclub was attacked. In Kenya, an Israeli owned hotel was bombed. Missiles shot at an Israeli charter just missed the plane. Each time, it had the propaganda victory or a new threat. Al Qaeda uses the Internet to spread the word.

BERGEN: It's the way they take credit for operations at this point. And it's a way they communicate.

BOETTCHER: Including this proof of life from Osama bin Laden in November, warning of worse to come.

OSAMA BIN LADEN, AL QAEDA TERRORIST (through translator): Just as you kill, you will get killed. And just as you shell, you will get shelled. Await then what will desman.

BOETTCHER: Within two days of its first airing on Al Jazeera, bin Laden's audio recording was posted on the Alneda Web site and just so the message was clear, this time al Qaeda posted its own English translation.

The real message -- "Osama bin Laden is still alive. And to stop al Qaeda, he has to be found."

(END VIDEOTAPE)

MESERVE: Coming up on CNN PRESENTS, the hunt for bin Laden in hostile territory.

(BEGIN VIDEO CLIP)

KAMAL HYDER, JOURNALIST: They do not seem him as a criminal. They see him as a fighter who is fighting for a cause.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MESERVE: Osama bin Laden's terrorist network is definitely up and running. As for the al Qaeda leader himself, well, that's another matter. Up until recently, many officials and experts had said that bin Laden was probably dead, but a new audiotape suggests otherwise. It also raises a number of questions, where is Osama bin Laden, why is he still at large and what's being done to hunt him down. Here again, CNN national correspondent, Mike Boettcher.

(BEGIN VIDEOTAPE)

BOETTCHER (voice-over): The men, Bravo Company, 2nd Battalion, 187th Infantry, 101st Airborne.

UNIDENTIFIED MALE: OK, Bravo Company, and let me tell you something you going on a real world combat mission. Don't let anybody tell you it's not.

BOETTCHER: The objective, a mountain path in Afghanistan. The goal -- capture, if necessary -- kill suspected al Qaeda members. One hundred fifty men chasing 20, hoping success will eventually lead to one other, Osama bin Laden. BUSH: I want justice.

BOETTCHER: Right after 9/11, President Bush made bin Laden the world's most wanted man.

BUSH: There's an old poster out west, as I recall, that said, "Wanted: Dead or Alive."

BOETTCHER: But after 15 months, the man with a $25 million bounty on his head remains a fugitive. Why? Bravo Company's assault provides a telling answer. The information that had pointed to the al Qaeda camp was up-to-date but not up to the minute. When Bravo Company arrived, the camp was empty, the caves, deserted. All Bravo Company could do...

UNIDENTIFIED MALE: Twenty packages of C-4 taped together.

BOETTCHER: ... was make sure nobody came back. The mission was the victim of what terrorism experts call hypermobility, the low-tech stealth that helps bin Laden evade high-tech spies.

RANSTORP: He will not be traveling in large convoys. It'll be picked up on satellite.

BOETTCHER: Magnus Ranstorp of Scotland's University of St. Andrews is a leading authority on terrorism.

RANSTORP: It's a virtual nightmare to try to find him given the global reach al Qaeda has. And al Qaeda of course exists in over 98 countries around the world.

BOETTCHER: A year ago, the American led forces almost had their man. They captured the Afghan city of Kandahar, a major al Qaeda stronghold. But bin Laden had retreated to the Tora Bora Mountains, a natural fortress near the Pakistan border.

An al Qaeda member later described the ensuing battle on a Web site frequently used by the group. Intelligence sources consider his account of a precision-guided bomb hitting bin Laden's bunker were lies.

UNIDENTIFIED MALE: Nothing was left but a big hole and pieces of dead bodies. Was Osama killed? Allah kept Osama bin Laden alive because he left the bunker only two nights before and moved to an area only 200 meters away.

BOETTCHER: In a videotape released a few days later, bin Laden appeared tired, frail, weak. He never moved his left arm. Intelligence experts believed bin Laden's left shoulder had required surgery, that he had at least been injured at Tora Bora. But from there, he vanished.

RANSTORP: I don't think the intensity of that search was adequate. And I think that there was a real possibility, the closest one we had, in actually capturing him. BOETTCHER: Many experts believe bin Laden is hiding in Afghanistan or perhaps slipped across the border into Pakistan's northwest territories.

HYDER: And you cannot seal a border with mountainous terrain.

BOETTCHER: Pakistan-based journalist, Kamal Hyder, is one of the few outsiders who have recently toured this remote area.

HYDER: People are there who support Osama bin Laden, who support his point-of-view. And yes, they would give their dues for this man if he was to come to their houses. They do not seem him as a criminal. They see him as a fighter who is fighting for a cause.

BOETTCHER: Only a handful of American operatives are there, CIA, FBI, military commandos. But the hunt for bin Laden is so politically sensitive, it's largely conducted by Pakistani forces. Even so, it's a challenge because the leaders of the local tribes carry more authority than the simple government.

HYDER: It is with quite difficulty that the Pakistan army has taken control of this region for the first time. If you introduce American forces, you are talking of a spillover from Afghanistan because the American forces will be seen more as an occupation force in the tribal area and then, the chances of a major revolt against American forces spreading into Pakistan cannot be ruled out.

BOETTCHER: For nearly a year, there was no public sign of bin Laden. Several officials, including Afghanistan's president, were optimistic.

HAMID KARZAI, PRESIDENT, AFGHANISTAN: The latest that I can think of is that the more time passes and we don't hear from of him in any form, I would come to believe that he probably is dead.

BOETTCHER: A few weeks later, bin Laden's spoke, a voice on an audiotape believed by coalition intelligence analysts to be bin Laden's, claimed credit for a host of recent terrorist attacks.

RANSTORP: To hear from the great leader, that would be an incredible morale booster and that may activate cells, sleeper cells, in the United States or elsewhere to undertake new operations.

BOETTCHER: As the hunt continued for al Qaeda foot soldiers and field commanders, the U.S. still wants Osama bin Laden dead or alive. He's the symbol of worldwide Jihad and in the war on terrorism, much more than just one man.

(END VIDEOTAPE)

MESERVE: When we come back, the intelligence war against al Qaeda -- secrets from the interrogation room.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It's a great stress relief to throw a chair against the wall and smash it into a hundred pieces and see someone's eyes balloon out.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MESERVE: It's been said time and time again; the war on terrorism is like no other. It certainly is being fought like no other. This is a war dominated by covert ops and secret interrogations where the true front lines aren't battlefields, but city streets and open tracks of desert. As CNN national security correspondent, David Ensor, reports this is the CIA's war.

(BEGIN VIDEOTAPE)

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): A shootout in downtown Karachi in September, between Pakistani police and al Qaeda militants, led to the capture of this very important prisoner, Ramzi Binalshibh, who was led away blindfolded. He's a key 9/11 plotter, U.S. officials say. He would have been one of the hijackers if he'd been able to get a U.S. visa. Now, he is in the hands of the U.S. Central Intelligence Agency.

COFER BLACK, FORMER DIRECTOR, CIA COUNTER TERRORIST CENTER: After 9/11, the gloves come off. Nearly, 3,000 al Qaeda and their supporters have been arrested or detained.

ENSOR: But Binalshibh is a much more select group of senior al Qaeda prisoners, including Aby Zubaydah, Omar al Faruk (ph), Abdel Rahim al Nashiri (ph). Some of bin Laden's top henchmen, U.S. officials say.

(on camera): They and others unnamed are under interrogation by the CIA in undisclosed locations around the world. Torture is not used by the United States and CIA officials refuse to discuss how they get information out of captives. But such prisoners may no longer know whether it's day or night.

(voice-over): For his latest book, author, Bob Woodward, talked to CIA officers in depth about the intelligence war.

WOODWARD: One technique is to not have them be interrogated by the CIA or the U.S. military, but to let the foreign intelligence service and say, Egypt, conduct the interrogation.

ENSOR: Sometimes, just the threat of being turned over to Egypt or Saudi Arabia is enough, sources say, to get a man talking. As for prisoners held and questioned in Afghanistan, one U.S. military interrogator, who declined to be identified, told how he got some of them to talk.

UNIDENTIFIED MALE: You would be amazed at what a kind word and a cup of hot cocoa on a 15-degree night will get you as far as information. Now, there's other ones that, you know, just want to be obstinate and it's a great stress relief to throw a chair against a wall and smash into a 100 pieces and see someone's eyes balloon out. But you have to be able to talk to them and figure out which buttons to push on that particular person.

ENSOR: The U.S. has thousands of prisoners, but it does not have the most important one of all, Osama bin Laden. About him, Woodward says, "The head of CIA Counter Terrorism gave these chilling orders..."

WOODWARD: "I want you to bring bin Laden's head back in a box. I want to take it in that box and show it to the president -- to President Bush to show that we had done what he said, what he authorized us to do."

ENSOR (on camera): It hasn't worked though, has it? They don't have bin Laden. They don't have several of the top leaders of al Qaeda.

WOODWARD: The fact that Osama bin Laden has eluded perhaps the most well financed and most determined manhunt in the history of known civilization is quite astonishing. It's a mixed record of success and failure, but in terms of what's important and that is that there's not been another major attack against the homeland, that is a big plus.

ENSOR (voice-over): No major attack against the U.S. or U.S. facilities overseas since 9/11, quite an achievement. What keeps director of Central Intelligence, George Tenet, awake at night is trying to keep it that way.

GEORGE TENT, CIA DIRECTOR: We are still in the hunt phase of this war, the painstaking pursuit of individual al Qaeda members and their cells. This phase is paying off, but it is intensive and it will take a long time.

ENSOR: They're doing everything they can think of, even attacking al Qaeda from the air last month. A senior leader died in his car in Yemen, hit by a hellfire missile fired from a CIA run unmanned predator drone.

But the key to stopping the next al Qaeda attack may well be infiltrating the organization. For U.S. intelligence, there's no greater challenge.

BERGEN: Culturing the sort of people who work in these agencies aren't the sort of people who can really penetrate al Qaeda. I mean, just to pass a background check to become, you know, in the CIA would preclude anybody who probably -- who could penetrate the group. So you know, it's sort of in a catch-22.

ROBERT BAER, FORMER CIA OFFICER: You can't take people from suburban Chicago or wherever they're coming from or suburban Los Angeles, bring them to Washington and dump this stuff on their desks and say, "Tell me what this means." We have a very -- it's a problem of experience.

ENSOR: Even if U.S. intelligence cannot directly infiltrate al Qaeda, it may still be able to get some information for money. About $70 million from the CIA, mostly in cash, money to buy off warlords and informers, was critical to overthrowing the Taliban in Afghanistan.

The overall intelligence budget is classified. But under this president, it is clearly growing fast.

WOODWARD: Bush, in the discretionary accounts of the CIA, has given the agency about $1 billion more.

ENSOR: President Bush is giving the CIA a lot of money but he expects results.

(on camera): Does he still keep that list in his top drawer that everyone's heard of?

WOODWARD: I understand he does. If somebody is apprehended, a leading terrorist, or killed, he marks an "X" through their picture. It's not just a list. It's with photos.

ENSOR (voice-over): The president is keeping score.

(END VIDEOTAPE)

MESERVE: Next on CNN PRESENTS, the threat at home. Can the FBI get the bad guy?

(BEGIN VIDEO CLIP)

SEN. PATRICK LEAHY, JUDICIARY COMMITTEE CHAIRMAN: They have got to make sure that this is the number one priority and I'm not convinced it is.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MESERVE: Al Qaeda may have scattered after the fall of Afghanistan, but its reach is no less global. Osama bin Laden's agents may be operating in as many as five-dozen countries, including the United States. And that is where the Justice Department and the FBI come in. It is their job to uncover suspected sleeper cells to route out terrorists at home, to prevent any potential attacks. But are they up to the job? CNN justice correspondent, Kelli Arena, went to FBI director, Robert Mueller, for some answers.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): Not much about this former steel town in upstate New York betrays its significant Arab-American population. Muslims who live in Lolowana (ph) assimilated generations ago. So it was a shock to the community when back in September, FBI agents accused six of its sons of training in an al Qaeda terror camp in Afghanistan and being part of a sleeper cell here in the United States.

One of the accused is 25-year-old Yessin Teher, a former high school soccer player and homecoming king. His attorney, Rodney Personius, denies Teher is a terrorist. RODNEY PERSONIUS, LAWYER FOR YESSIN TEHER: As far as what gave rise to his travel overseas, as much as anything else, I think it was a combination perhaps of being inquisitive with respect to his religion and I suspect to some degree also being a bit gullible.

ARENA: The other suspects have also denied the charges. While heralding the arrests, FBI director, Robert Mueller, did admit at the time that there was no evidence the Locowana (ph) six were planning an attack.

MUELLER: We have not seen any plans of an imminent attack.

ARENA: Still, Mueller says, such arrests are vital in the war on terror.

MUELLER: Now, people will say, "Well, how do you know an individual is a terrorist?" And then, of course, you'd like to find an individual with guns, weapons or explosives. But if you look at the suicide attackers of September 11, they had box cutters and a plan and that was it.

ARENA: The FBI has also closed in on other alleged terrorist sleeper cells in Portland and Detroit, and arrested a Seattle man who alleged tried to set up a terrorist camp in Blye, Oregon. All say they're innocent.

Some terror analysts suggest the government is wasting its time on terrorist wanna-be's.

JULIETTE KAYYEM, JOHN F. KENNEDY SCHOOL OF GOVERNMENT: Do we really think that they are key players in al Qaeda? No. I mean the Justice Department's not even alleging that. Do we think that they're arrests are going to; you know, disrupt or undermine any potential series attacks? Likely not.

ARENA: The head of the criminal division at the Justice Department argues that not taking these types of individuals into custody could prove dangerous.

MICHAEL CHERTOFF, U.S. DEPARTMENT OF JUSTICE: If we actually have a situation where we arrest someone in the face of imminent attack, in some ways, we haven't done our job. It should never really get to the point of the last minute.

ARENA: Sources tell CNN the FBI has under surveillance at least 200 individuals with possible terror ties as well as several mosques.

MUELLER: There are a number of individuals in the United States who are sympathizers. There are a number of individuals in the United States who are supporters. And there are a number of individuals in the United States who funnel money into terrorist -- well, charitable organizations that fund terrorists.

ARENA (on camera): The war on terror has cast the FBI in a new role. It is a seat change for the bureau's mission from solving crime to preventing terrorist attacks. (voice-over): Some have questioned whether the FBI is up to the job.

LEAHY: They have got to make sure that this is the number one priority and I'm not convinced it is. And I don't think many in the FBI are convinced yet that it is or that their structure is such that they can be.

ARENA: Some critics are proposing the creation of a separate agency to gather domestic intelligence. The idea hasn't gained much transaction and Director Mueller says his agents have what it takes.

MUELLER: I firmly believe that the bureau can and should do the job.

ARENA: The FBI has almost doubled the number of analysts assigned to counter terrorism. And CIA agents are now permanently posted at the FBI to improve communication.

The bureau has moved up the deadline for upgrading its antiquated computer system, but they will not be completely up to par for another year. And the bureau still needs more linguists to translate intelligence.

But the FBI does have new weapons in this war. There are less restrictions on how agents can gather information and the bar for obtaining wiretaps is lower.

Government agents are also employing an aggressive detention and deportation policy of those in the country illegally. What's more, visitors from selected countries, many in the Middle East, undergo special processing and fingerprinting. Arab-American groups say there is no proof such policies work.

IBRAHIM HOOPER, COUNCIL ON AMERICAN ISLAMIC RELATIONS: Terrorists don't come in this way. They know how to get around these kinds of things. If we thought this was an effective means of law enforcement, we'd be all for it. But we think it's counterproductive in that it creates great resentment.

ARENA: Resentment in the Arab-American community at a time the government most needs its help. As the experts point out, terrorists only need to get lucky once.

(END VIDEOTAPE)

MESERVE: When we return, is America's war on terror on Americans?

(BEGIN VIDEO CLIP)

MEHMOOD: I never ever expected that this injustice could happen to me in America.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MESERVE: Terror suspects snatched off the streets, carted off to some undisclosed location, few rights, no lawyers, no contacts. If you're thinking sure, in Yemen perhaps but not here no way, well, that's not what CNN's Brooks Jackson found as he explored the new balance between safety and freedom.

(BEGIN VIDEOTAPE)

BROOKS JACKSON, CNN SENIOR CORRESPONDENT (voice-over): He was a U.S. taxpayer, business owner, homeowner, educating his boys in a New Jersey public school, a hardworking Pakistani immigrant liked by neighbors.

UNIDENTIFIED FEMALE: If you're carrying something and wanted help, yes, he was a very nice man.

JACKSON: But soon after September 11, federal agents swooped down, searched his home and hauled him off to a federal prison, shackled and chained.

MEHMOOD: I heard announced -- somebody telling me that keep your mouth shut, otherwise you'll be dead. Don't ask any questions otherwise you will be dead.

JACKSON: He says they slammed him into a wall, bloodied his mouth, broke his hand, leaving it painfully swollen and untreated. The Justice Department's Inspector General's Office is investigating the handling of Anser Mehmood's case and others. Federal prosecutors won't discuss his case now, but in court, they said they needed to investigate why this Pakistan citizen had an expired visa, a truck license to haul hazardous material, a Swiss bank account and multiple passports.

Mehmood says there are innocent explanations. For example, the Swiss bank account was a joint account with his father. But he says the government never questioned it. They held him in solitary confinement here in Brooklyn, in a tiny cell, with the only window painted black. Lights and cameras on him 24 hours a day.

MEHMOOD: That was mostly -- it was like a grave.

JACKSON: At first, he just disappeared, the kind of thing that happens in other countries not America.

UZMA NAHEED, MEHMOOD'S WIFE: They didn't give me any answers. They didn't tell me where they are being taken him.

UZAIR ANSER, MEHMOOD'S SON: First, we went to a police station and then, she was trying to get the information. Nobody would tell her.

JACKSON: They held him in prison for six months. He lost his home. It's boarded up now, lost his truck, his livelihood. In the end, they charged him only with altering his social security card to remove four words -- not valid for employment -- so he could work. The judge released him immediately. The government deported him back to Pakistan.

STOLAR: It turns the presumption of innocence on its head. It says because you fit a certain profile, you are probably involved in some kind of illegal conduct. And you know that's just not the American way of doing business.

JOHN ASHCROFT, UNITED STATES ATTORNEY GENERAL: This rule change will apply to the 75 individuals who are currently detained. Over 480 people arrested or detained. Six hundred and fourteen persons.

JACKSON: Federal officials stopped counting when the total reached 1, 182. Of all those rounded up in the days after September 11, officials accused only four of being linked to terrorism.

(on camera): If you think what happened here could not happen to an American born citizen, think again. It is happening right now.

ASHCROFT: We have captured a known terrorist.

JACKSON (voice-over): Federal agents arrested Jose Padilla at O'Hare Airport in Chicago last May. He was born in Brooklyn, grew up in Chicago. A U.S. citizen locked up in a Navy brig indefinitely. Padilla is a violent criminal with a prison record.

Federal officials say he spoke with al Qaeda about exploding a radioactive, dirty bomb somewhere in the U.S. But they admit he had no actual bomb material, no specific target, no real plan. Prosecutors turned him over to the Pentagon to be held as a -- quote -- "enemy combatant." No charges, no trial. No access to family or to his lawyer. The president specifically approved.

BUSH: He is now off the streets where he should be.

JACKSON: Scary says a lawyer involved in his case.

KATE MARTIN, PADILLA'S ATTORNEY: And for the U.S. government to take the position that on the say so of the president it can pick up, arrest, and secretly jail in a military brig a U.S. citizen, is truly an extraordinary and dangerous claim.

JACKSON: But Justice Department officials say it's just common sense.

CHERTOFF: Because you can't have people who are allied with the enemy and release them in order to go back up again and continue to carry out attacks against the United States.

JACKSON: This month, a judge said Padilla must be allowed to see his lawyer, a set back for the government. But the judge also said, Padilla's incarceration is legal if the government shows only -- quote -- "some evidence to declare him a combatant for al Qaeda," a very low standard of proof.

Even for law-abiding citizens, privacy is eroding. The FBI now may more easily get national security warrants for library records or any business records under the U.S.A Patriot Act passed after 9/11. ANTHONY ROMERO, AMERICAN CIVIL LIBERTIES UNION: The ordinary, law-abiding American citizens need to be concerned. It's also how the government, after 9/11, has begun to prosecute the war on terror by snooping and piercing and surveilling the lives of law-abiding Americans.

CHERTOFF: Show me the core, fundamental values, which have been sacrificed. In fact, everything that we have done is well within the Constitution and well within the law. And in fact, some people have criticized us for being too modest.

JACKSON: But even some Republican Conservatives say the price is too high.

GROVER NORQUIST, AMERICANS FOR TAX REFORM: What we're fighting for in the war against al Qaeda and the Taliban is for our freedom. That's what we're defending. We need to keep coming back for that. What's great about America is not what color we are, not what religion we are, not what language we speak, it's that we're the country that's the home of freedom.

JACKSON: And even now, living in Pakistan, Mehmood and his family would agree.

MEHMOOD: I never ever expected that this injustice could happen to me in America.

JACKSON: Even now, his sons say every day they tell their father they want to go back.

(END VIDEOTAPE)

MESERVE: Coming up, how secure is the homeland.

(BEGIN VIDEO CLIP)

STEPHEN FLYNN, COUNCIL ON FOREIGN RELATIONS: We are dangerously unprepared right now to prevent a terrorist attack and to respond capably to one if it happens.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

MESERVE: The terrorist attacks of September 11, 2001 laid bare this nation's vulnerabilities. Fifteen months later, it's reasonable to ask is it any safer. And the answer is yes to a point. Experts say much more needs to be done. In fact, a recent report from the Hart- Rudman Commission found the nation is dangerously unprepared and is lapsing back into complacency.

Tom Ridge, who will head the new Department of Homeland Security, says the key to protecting the country rests in the cities and towns across America. And so, we visited one, Niagara Falls, New York, to be exact, to see what was happening and what was not.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): Even on a brittle, cold morning, the thundering beauty of Niagara Falls draws tourists. Could it draw terrorists too? Because of its crowds and landmark status, city officials fear it could and experts say this city and every other is vulnerable.

FLYNN: We are dangerously unprepared right now to prevent a terrorist attack and to respond capably to one if it happens.

MESERVE: The Niagara River switchbacks its way from Lake Erie to Lake Ontario, separating the U.S. and Canada. The city of Niagara Falls perched here, right on the border, presents special concerns.

Since the September 11 attacks, the Customs Service and the Immigration and Naturalization Service has stepped up their policing of the three international border crossings in the city. But what about the stretches of river between those bridges?

(on camera): Canada is to my right, the U.S. to my left. At some point, the shores are only about 100 yards apart. People and goods are smuggled across all the time and the fear is that some day it will be terrorists and weapons of mass destruction.

What time of day or time of year do people tend to cross?

UNIDENTIFIED MALE: All times. It really is all times.

MESERVE (voice-over): It is the task of the U.S. Border Patrol to catch whoever is bold or desperate or fool hardy enough to try to cross. Since 9/11, it has doubled its manpower here. Its helicopters swoop through the sky watching for suspicious vessels, activities, people. Surveillance cameras do the same, swinging to and fro day and night. The images monitored from afar.

This day, a suspicious boat is spotted and agents are dispatched to investigate.

UNIDENTIFIED MALE: Ten four, we'll do it.

MESERVE: They find a fishing boat. Border Patrol agents on the ground check it out.

UNIDENTIFIED MALE: Yes, (UNINTELLIGIBLE), is he local?

UNIDENTIFIED MALE: Affirmative.

MESERVE: Nothing out of order here, but in the past year, along a 10-mile stretch of river, the Border Patrol nabbed 400 people trying to enter the U.S. illegally, including this man. An infrared camera picked him up crossing a railroad bridge carrying $150,000 worth of marijuana.

(on camera): Do you think you're coming near to catching all of the people that are coming across? MIKE RUSSELL, U.S. BORDER PATROL: I would say no. It's too easy of an area to cross. It doesn't matter how many people you have, it's just a difficult area to control completely.

MESERVE: Who was getting in the country is one concern. What they could do is another. City councilman, Paul Dyster, heads Niagara Falls homeland security efforts

PAUL DYSTER, NIAGARA FALLS CITY COUNCIL: It's a little nerve- wracking not knowing exactly who's, you know, lurking in the bushes on the other side of the river when you've got the hydroelectric facility sitting there, located right on the border.

MESERVE: This, the largest generating plant in New York State, has been identified by city officials as a potential target, another, the plant's reservoir. If it were breached, much of the city could be flooded, including the chemical plants, which are the industrial backbone of this community.

City officials say the chemical industry has improved security in the last 15 months. There are more fences, more cameras, more guards, but...

DYSTER: These factories are older factories. In many cases, they're downsizing. They're not looking to reinvest huge amounts of money in these facilities. And it makes it difficult, you know, to justify maybe sometimes a lot of really expensive security measures.

MESERVE: Produced in these plants, some of the most toxic chemicals, including chlorine. After manufacture, they are shipped by rail. Loaded tank cars move throughout the city. There is, in short, a lot to protect.

DYSTER: Is it as safe as it could be? No, it's not. Is there a reason why it's not as safe as it could be? Well, there is and it's the obvious reason of dollars.

MESERVE: As jobs have moved elsewhere, the city's population has dwindled. Half of those who remain are on some form of government assistance. The declining tax base has brought a fiscal crisis so severe that despite homeland security demands, 14 police officers and a dozen firefighters had been cut since 9/11.

The city's emergency equipment is old. And despite, the heavy presence of the chemical industry, the city has only one hazardous materials truck. It just got its first top of the line HAZMAT suits, but only half a dozen. And the city doesn't have enough cash to train firefighters to use them.

WILLIAM CORREA, NIAGARA FALLS FIRE CHIEF: Four to six suits may be able to handle some type of tractor trailer incident or a small leak in a heavy rail car, things of that nature. It is not going to begin to address something on a grand scale relative to terrorism. It's not even going to begin to.

MESERVE: Niagara Falls has tried to something with nothing. For instance, old construction barricades have been recycled and repositioned to deter truck bombers. Paul Dyster says even an infusion of $100,000 would be a big boost, but the city hasn't seen a cent in homeland security funds from the federal government.

DYSTER: If you had told me a month after the attack that now a year-and-a-half later, we'd still be waiting for the first federal dollar to get here, I would not have believed that that was possible.

MESERVE: Besides New York and Washington D.C., no cities have received significant homeland security funds according to the National League of Cities.

Homeland security expert, Stephen Flynn, says with state and local budgets stretched, the federal government must put its money where its mouth is.

FLYNN: The federal government must take the lead in providing the resources and providing the leadership to help communities like Niagara Falls be able to protect themselves and in so doing protect the broader nation.

MESERVE: Failure to do so, say the experts, may mean another attack is as inevitable as water going over the falls.

(END VIDEOTAPE)

MESERVE: Sixteen months after losing its stronghold in Afghanistan, al Qaeda's reach is no less global and its threat no less alarming. As the U.S. military now focuses on Iraq, a new al Qaeda, reconstituted and high tech, is still at large and on the attack.

That's it for this special edition of CNN PRESENTS. I'm Jeanne Meserve. Thanks for joining us.

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