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Senate Judiciary Hearing with FBI Director James Comey. Aired 11:30-12p ET

Aired May 3, 2017 - 11:30   ET


SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: And there's no reason they won't attempted here if we don't stop them over time?

[11:30:03] JAMES COMEY, FBI DIRECTOR: I think that's fair.

GRAHAM: Thank you.



Welcome back, Director Comey. What is the policy of the Department and the Bureau regarding the release of derogatory investigative information about an uncharged subject?

COMEY: The general practices we don't talk about, completed investigations that didn't result in charges, as a general matter.

WHITEHOUSE: And what is the policy regarding a release of derogatory information about charged subjects beyond the derogatory investigative information disclosed either in the charging document or in further court proceedings?

COMEY: Well, I think you summarized it. The gist of the policy is you don't want to do anything outside the charging documents of the public record that might prejudice the trial proceeding.

WHITEHOUSE: And one of the reasons you do that is if you had a police chief say, we have investigated the contract between the mayor and the contractor and we've decided there were no misdeeds. But we found out that the mayor was sleeping with her driver, just wanted to let you know that.

That would be kind of a blow to the integrity the prosecutor function and would probably tend to diminish the support for the prosecutor function if were played by those rules, correct?

COMEY: I think that's fair, that's why the policy exists.

WHITEHOUSE: Yes. With respect to oversight questions, let's hypothesize that an investigation exists and the public knows about it, which could happen for a great number of legitimate reasons. What questions are appropriate for senators to ask about that investigation in their oversight capacity? COMEY: They can ask anything they want...

WHITEHOUSE: But what -- what questions are appropriate for you to answer?

COMEY: Very few while a matter is pending and... WHITEHOUSE: While we know it's pending, is it appropriate for you to tell us whether it's adequately resourced and to ask questions about for instance, are there actually agents assigned to this or has this been put in somebody's bottom drawer?

COMEY: Sure, potentially, right...


COMEY: ... how's it being supervised, who's working on it, that sort of thing.

WHITEHOUSE: And are there benchmarks in certain types of cases where departmental approvals are required or the involvement of certain department officials is required to see whether those steps have actually been taken?

COMEY: I'm not sure I'm following the question, I'm sorry.

WHITEHOUSE: Let's say you've got a hypothetically, a RICO investigation and it has to go through procedures within the department necessary to allow a RICO investigation proceed if none of those have ever been invoked or implicated that would send a signal that maybe not much effort has been dedicated to it.

Would that be a legitimate question to ask? Have these -- again, you'd have to know that it was a RICO investigation. But assuming that we knew that that was the case with those staging elements as an investigation moves forward and the internal department approvals be appropriate for us to ask about and you to answer about?

COMEY: Yes, that's a harder question. I'm not sure it would be appropriate to answer it because it would give away what we were looking at potentially.

WHITEHOUSE: Would it be appropriate to ask if -- whether any -- any witnesses have been interviewed or whether any documents have been obtained pursuant to the investigation?

COMEY: That's -- that's also a harder one. I'd be reluctant to answer questions like that because it's a slippery slope to giving away information about exactly what you're doing.

WHITEHOUSE: But if we're concerned that investigation gets put on the shelf and not taken seriously, the fact that no witnesses have been called and no documents have been sought would be pretty relevant and wouldn't reveal anything other than a lack of attention by the bureau, correct?

COMEY: It could, but we're very careful about revealing how we might use a grand jury, for example. And so, if we start answering...

WHITEHOUSE: Well, you've got 6E (ph), I understand that.


WHITEHOUSE: This is a separate thing.

COMEY: Yes, so that's a harder call.

WHITEHOUSE: Well, we'll pursue it. What is the department's or the bureau's policy regarding witnesses who are cooperating in investigation who have some form of ongoing compliance problem?

Let's say they haven't paid their taxes for the last year. Is it the policy of the department or the bureau that they should get those cooperating witnesses to clean up their act so that their noncompliance does not become an issue later on in the case?

COMEY: Yes, I don't know whether it's a written -- I know I should know this. I can't remember sitting here whether there's a written policy. It's certainly a long standing...

WHITEHOUSE: Certainly practice isn't it?

COMEY: ... practice.

WHITEHOUSE: Long standing practice, exactly. When are tax returns useful in investigating a criminal offense?

COMEY: Well, they're useful in showing unreported income, motive -- If someone hides something that's -- should otherwise be a tax return indicates they might know it was criminal activity.

WHITEHOUSE: It's not uncommon to seek and use tax returns in a criminal investigation?

COMEY: Not uncommon, it's -- it's a very difficult process, as it should be. But especially in complex financial cases, it's a relatively common tool.

[11:35:00] WHITEHOUSE: The hearing that Senator Graham and I held with respect to Russia's infiltration and influence in the last election raised the issue of Russia intervening with business leaders in a country, engaging them in bribery or other highly favorable business deals with a view to either recruiting them as somebody who has been bribed or being able to threaten them by disclosing the illicit relationship. They're perfectly happy to blow up their own cut out, but it also blows up the individual.

Have you seen any indication that those are Russian strategies in their election influence toolbox?

COMEY: In general?

WHITEHOUSE: In general.

COMEY: My -- my understanding is those are tools that the Russians have used over many decades.

WHITEHOUSE: And lastly, the European Union is moving towards requiring transparency of incorporations so that shell corporations are harder to create. That risks leaving the United States as the last big haven for shell corporations. Is it true that shell corporations are often used as a device for criminal money laundering?


WHITEHOUSE: Is it true that shell corporations are often used as a device for the concealment of criminally garnered funds?


WHITEHOUSE: And to avoid legitimate taxation?


WHITEHOUSE: What do you think the hazards are for the United States with respect to election interference of continuing to maintain a system in which shell corporations -- that you never know who's really behind them are common place?

COMEY: I suppose one risk is it makes it easier for illicit money to make its way into a political environment.

WHITEHOUSE: And that's not a good thing.

COMEY: I don't think it is.

WHITEHOUSE: Yeah, me neither. OK. Thank you very much.

GRASSLEY: Senator Sasse.

SEN. BEN SASSE (R), NEBRASKA: Thank you Chairman.

Director thank you for being here. Given the FBI's extensive responsibilities and expertise in cyber and counterintelligence investigations, how likely do you think it is that Senate IT systems have been targeted by foreign intelligence surfaces -- services?

COMEY: I would estimate it's a certainty.

SASSE: Inside the IC who -- who would talk about that problem and who at the Senate would they inform?

COMEY: Well, there have been -- I don't want to talk about particular matters, but it often is the FBI alerting a U.S. government institution or private sector. DHS might come across it, or -- or other parts of the intelligence community, especially NSA.

SASSE: When we talk about things like cyber investigations right now, so often on cable TV it becomes a shirts and skins exercise. So without asking you to comment about anything that's retrospective about 2016, do you think it's likely that in 2018 and beyond you're going to see more targeting of U.S. public discourse and elections? COMEY: I do. I think one of the lessons that particularly the Russians may have drawn from this is that this works. And so as I said last -- a month or so ago I expect to see them back in 2018, especially 2020. SASSE: You regularly testify -- and correct me if I've -- if I've misheard you but I think you've regularly testified that you don't think the Bureau is short of resources. You don't come before us and make big increased appropriations requests. And yet those of us who are very concerned about cyber look at the U.S. government writ large and think were not at all prepared for the future.

Can you tell us what the FBI is doing to prepare for that 2018 and 2020 circumstance that you envision?

COMEY: Without giving to much detail, we have a -- enormous part of the FBI in our counter intelligence division and in our cyber division that focuses on just that threat and making sure that we do everything that we can to understand how the bad guys might come at us. And as I talked about earlier to equip the civilian agencies that are responsible for hardening our infrastructure with all the information we have about how they're going to come at us.

SASSE: And if you had international security domain increased resources, how would you spend another marginal dollar beyond what you expect to receive now?

COMEY: I probably have a tie between investing more in upgrading our systems to make sure we're keeping pace with the bar of excellence. And probably to hire additional cyber agents and analysts.

SASSE: And if you had your druthers, what kind of increased funding request would you make?

COMEY: I wouldn't make any sitting here.

SASSE: I'd like to talk a little bit about WikiLeaks. In January the FBI contributed to an IC assessment that concluded that WikiLeaks is a known outlet of foreign propaganda. Do you stand by that assessment?


SASSE: Do you believe that WikiLeaks has released sensitive and classified information?


SASSE: Do you believe any of WikiLeaks disclosures have endangered American lives and or put at risk American interests?

[11:40:05] COMEY: I believe both have been the result of some of their releases.

SASSE: Can you help me understand why Julian Assange has not been charged with a crime?

COMEY: Well I don't want to comment on the particular case, because I don't want to confirm whether or not there are charges pending. He hasn't been apprehended because he's inside the Ecuadorian embassy in London.

SASSE: I sent a letter to the Attorney General a number of weeks ago, asking questions about the status of the investigation and it seems pretty clear though individuals were polite and kind and responsive to our request. It seemed that across the I.C., there wasn't much deliberation about WikiLeaks and about Julian Assange and this question, is the FBI participating in any interagency dialogue about whether or not Assange has committed crimes?

COMEY: I don't know where you got that impression, but WikiLeaks is a important focus of our attention.

SASSE: I intentionally left the almost half of my time for you to sort of wax broadly for a minute. There is room for reasonable people to disagree about at what point an allegedly journalistic organization crosses a line to become some sort of a tool of foreign intelligence. There are Americans, well-meaning, thoughtful people who think that WikiLeaks might just be a journalistic outfit. Can you explain why that is not your view?

COMEY: Yes and again, I want to be careful that I don't prejudice any future proceeding. It's an important question, because all of us care deeply about the First Amendment and the ability of a free press, to get information about our work and -- and publish it.

To my mind, it crosses a line when it moves from being about trying to educate a public and instead just becomes about intelligence porn, frankly. Just pushing out information about sources and methods without regard to interest, without regard to the First Amendment values that normally underlie press reporting. And simply becomes a conduit for the Russian intelligence services or some other adversary of the United States just to push out information to damage the United States. And I realize, reasonable people as you said, struggle to draw a line.

But surely, there's conduct that so far, to the side of that line that we can all agree there's nothing that even smells journalist about some of this conduct.

SASSE: So if you could map that continuum, there are clearly members of the I.C. that of at different points in the past, leaked classified information. That is an illegal act, correct?

COMEY: Correct.

SASSE: When American journalists court and solicit that information, have they violated any law by asking people in the I.C. to potentially leak -- to leak information that is potentially classified?

COMEY: That conduct is not treated by the U.S. government as criminal conduct. I've been asked in other contexts, isn't it true that the espionage statute has no carve out for journalists? That's true, but at least in my lifetime, the Department of Justice's view has been newsgathering and legitimate news reporting is not covered, is not going to be investigated or prosecuted as a criminal act. That's how it's thought of. SASSE: So an investigative reporter, taking advantage of and

celebrating the liberties that we have under the First Amendment at the Washington Post or the Omaha World-Herald or at the Lincoln Journal Star, at the New York Times, trying to talk to people in the I.C. and get the maximum amount of information that they possibly can out of them to inform the public.

It is not the burden of an American journalist to discern whether or not the member of the I.C. is leaking information that might be classified, the journalist can legitimately seek information? And it's not their job to police it. The member of U.S. I.C. that leaks classified information has broken a law?

COMEY: Right. The -- the clear legal obligation rests on those people who are in the government in possession of -- of intelligence, you know, classified information. It's not the journalist's burden.


COMEY: Our focus is and should be on the leakers, not those that are obtaining it as part of legitimate newsgathering.

SASSE: So I want to hear this part one more time and I know that the chairman has indulged me, I'm -- I'm at and past time. But the American journalist who's seeking this information differs from Assange and WikiLeaks how?

COMEY: In that, there's at least a portion and people can argue that maybe this conduct WikiLeaks has engaged in, in the past that's closer to regular newsgathering. But in my view, a huge portion of WikiLeaks's activities has nothing to do with legitimate newsgathering, informing the public, commenting on important public controversies, but is simply about releasing classified information to damage the United States of America. And -- and -- and people sometimes get cynical about journalists.

American journalists do not do that. They will almost always call us before they publish classified information and say, is there anything about this that's going to put lives in danger, that's going to jeopardize government people, military people or -- or innocent civilians anywhere in the world.

And then work with us to try and accomplish their important First Amendment goals while safeguarding those interests. This activity I'm talking about, WikiLeaks, involves no such considerations whatsoever. It's what I said to intelligence porn, just push it out in order to damage.

SASSE: Thank you.

FEINSTEIN: Thank you, Senator.

Senator Franken.

FRANKEN: Thank you, Senator Feinstein. Good to see you, Mr. Director. I'm going to kind of pick -- pick up

where I think Sheldon Whitehouse, Senator Whitehouse, was going. Are you familiar with the report called the Kremlin playbook?


FRANKEN: OK, this is a expert report that exhaustively documents Russia's past efforts to undermine European democracies. According to the report Russia is known to cultivate close ties with business and political leaders in target countries. This is stuff you acknowledged to Senator Whitehouse that you knew happened. The report explains that, quote, Russia has cultivated an opaque network of patronage across the region that it uses to influence and direct decision- making.

In other words, Russia has a strategy of creating the conditions that give rise to corruption, then exploiting that corruption to its own benefit. And the intelligent -- intelligence communities unclassified assessment of the Russia -- Russian campaign to influence the American election -- our nation's intelligence agencies write, quote, "Putin has had many positive experiences working with Western political leaders whose business interests made them more disposed to deal with Russia." That seems to jive with your understanding of what Russia has done.

COMEY: Correct.

FRANKEN: Now in that same assessment, the FBI, CIA and the NSA all concluded that Russia did in fact interfere in the 2016 election in order to, quote, help President-elect Trump's election chances when possible by discrediting Secretary Clinton. And the agencies concluded that the Russians had a clear preference for President Trump.

What is your assessment of why the Russian government had a clear preference for President Trump?

COMEY: The intelligence communities' assessment had a couple of parts with respect to that. One is he wasn't Hillary Clinton, who Putin hated and wanted to harm in any possible way, and so he was her opponent, so necessarily they supported him.

And then also this second notion that the intelligence community assessed that Putin believed he would be more able to make deals, reach agreements with someone with a business background than with someone who'd grown up in more of a government environment.

FRANKEN: OK, well, I'm curious about just how closely Russia followed the Kremlin playbook when it meld (ph) in our democracy, specifically whether the Russians had a preference for President Trump because he had already been ensnared in their web of patronage -- web of patronage is a quote from the report. Is it possible that in the Russian's views -- view Trump's business interests would make him more amenable to cooperating with them, quote, more disposed to deal with Russia as the I.C. report says?

COMEY: That was not the basis for the I.C.'s assessment.

FRANKEN: OK, well, is it -- I just said is it possible?

COMEY: I see.

FRANKEN: You don't want to speculate.

COMEY: Yes, because possible questions are hard for me to answer.

FRANKEN: Yes. Well, in order for us to know for certain whether President Trump would be vulnerable to that type of exploitation, we would have to understand his financial situation. We'd have to know whether or not he has money tied up in Russia, or obligations to Russian entities, do you agree?

COMEY: That you would need to understand that to evaluate that question? I don't know.

FRANKEN: Well, it seems to me that there is reason to believe such connections exist. For example the President's son Donald Trump Junior told real estate developers in 2008 that quote, Russians make up a pretty disproportionate cross section of a lot of our assets. He said quote, "we see a lot of money pouring in Russia." This is a report on the family business.

In 2013 President Trump held the Ms. Universe pageant in Moscow. And the pageant was financed by Russian billionaire who is close to Putin. And President Trump sold a Palm Beach mansion to a Russian oligarch for $95 million in 2008. That's $54 million more than he paid for it just four years prior. Those are three financial ties that we know of and they're big ones.

Director Comey, the Russians have a history of using financial investments to gain leverage over influential people and then later calling in favors. We know that. We know that the Russian's interfered in our election and they did it to benefit President Trump. The intelligence agencies confirmed that.

But what I want to know is why they favored President Trump. And it seems to me that in order to answer that question any investigation into whether the Trump campaign or Trump operation colluded with Russian operatives would require a full appreciation of the president's financial dealings.

Director Comey, would President Trump's tax returns be material to such an investigation?

COMEY: That's not something Senator that I'm going to answer.

FRANKEN: Does the invest -- does the investigation have access to President Trump's tax returns?

COMEY: I'm going to have to give you the same answer. Again I hope people don't over interpret my answers, but I just don't want to start talking about anything -- what we're looking at and how. FRANKEN: Director Comey, we continue to learn about ties between

Russia and former members of the President's campaign and current senior members of his administration.

Jeff Sessions; attorney general and former campaign advisor Carter Page, former campaign advisor Paul Manafort, I'm a former campaign manager Paul Manafort, and also his chief strategist, Rex Tillerson; secretary of State, Roger Stone; political mentor and former campaign advisor Michael Flynn; former national security advisor, Jared Kushner; White House senior advisor and son in law.

Now we don't even know if this list is exhaustive, but I think you might see where I'm going and these connections appear against a backdrop of proven Russian interference in the election and interference that the intelligence community has concluded was designed to favor President Trump. From a -- I know I'm hitting my time, but let me ask one question (inaudible)

FRANKEN: Thank you Mr. Chairman. From an investigative standpoint, is the sheer number of connections unusual or significant? What about each individual's proximity to the president, it is unusual for individuals in these important roles to have so many unexpected and often undisclosed ties to a foreign power.

COMEY: I'll have to give you the same answer, that's not something I can comment on.

FRANKEN: OK. I thank you, Mr. Chairman.

GRASSLEY: Senator Flake?

FLAKE: Thank you, Mr. Chairman and thank you, Director Comey.

With regard to 702 reauthorization, last -- the -- in 2014, the Privacy and Civil Liberties Oversight Board recommended that agencies develop mechanisms to limit the potential scope of incidental collection. Under your leadership, what has the bureau done to comply with these recommendations?

COMEY: What we've done is make sure that we have tightened up our training and our -- and making sure that nobody with unauthorized access gets to see the content of a 702 collection. That's probably a good way of summarizing it, there's a lot more beneath that but that's the gist of it. Just to make sure, we're still -- we're collected under -- under 702, just to make sure that nobody gets access to it, doesn't have a need to know and hasn't been trained on how to handle FISA information.

FLAKE: OK. Can you briefly describe the process for incidental collection or minimizing those who were involved?

COMEY: Yes. Incidental collection is the name given to, if you're targeting a terrorist, let's say who's in Yemen and he happens to be using an American e-mail provider to communicate.

So under 702, the U.S. intelligence community can collect that terrorist communications. He's outside the United States and he's not an American. If an American contacts that terrorist, sends him an e- mail at his, let's imagine its a Gmail account, his Gmail, that will be incidentally collected, that American who sent the e-mail to the terrorist is not the target.

But because he or she communicated with the terrorist, that is collected as part of that lawful collection. That's what incidental collection means. And if the FBI is doing that 702 collection, those communications from the terrorist and to the terrorist would sit in our database. If we open an investigation on that person who happened to be the communicant and we search our systems, we will hit on that 702 collection and the investigating agent will know holy cow, there's an American was in touch with that terrorist in Yemen.

If that agent has been trained and has access to the information, they'll be able to know it. That's how our systems are designed. FLAKE: Well, thank you. I should say the same review that was conducted in 2014 does point out the value of the program. I certainly think and I think most of us do here see the incredible value 702 and the need for reauthorization, there.

With regard to, just a different topic completely, polygraph testing. As you're aware, any applicant for a law enforcement position with the Federal Government is required to undergo a polygraph. It's worth noting that CPB experiences a significantly high -- higher failure rates of around 65 percent than -- than any other federal law enforcement agency. The FBI does pretty well with this.

Has the Bureau ever conducted any benchmarking with other federal agencies as to the process, where if you require a polygraph for -- for employment? It seems that -- I mean given FBI success with this instrument, that you could inform some of the other agencies who are having difficulties.

COMEY: I don't know whether we have, Senator, but I'll find out.

FLAKE: All right.

COMEY: I think we have with other members of the intelligence community, but I don't know whether we've talked to CBP about our program.

FLAKE: All right. It would be helpful with regard to CPB if you could look into that, we appreciate it. With regard to data breaches falling on what Senator Sasse was asking, given the amount of sensitive data held by the FBI, what are you doing to protect your own systems.

COMEY: A whole lot I don't want to talk about too much...

FLAKE: Understood.

COMEY: ... in an open forum, but it is a constant worry of all of us. Under -- since I've been director, we've stood up something called the Insider Threat Center, and I've put a senior executive -- FBI executive in charge of it because I want someone waking up every morning worrying about how might we lose data, who might be penetrating us, either our systems or as a human asset.

And so a ton of work has gone into protecting our systems, but the weakest link is always the people because you can have the greatest firewalls and the greatest intrusion detection system. But if your people are engaging in either negligent or intentional misconduct, all of that's defeated.

So we're spending a lot of time trying to make sure we have a rich picture of our people that is constant and doesn't depend upon five- year polygraph reinvestigations but that shows us flags of a troubled employee in real time. That's hard to do and build. Technically it is a matter of law and policy, but we're working very hard on it.

FLAKE: In your opinion, is Congress doing enough to protect itself and our systems from outside -- outside threats?

COMEY: I don't mean this is a wise guy answer, surely not because none of us can be doing enough, frankly. Again, it's not just about the -- the perimeter we build, it's about the security culture inside our organizations. And -- and look, I'm part of the FBI and I still don't think ours is good enough. I'm sure Congress's is not good enough.

FLAKE: Do you know the Freedom of Information Act allows access -- citizens have the right to get information from the federal government. Can you talk about how the bureau promptly and fully responds to FOIA requests at the same time you level -- or maintain some level of security over sensitive and classified data?

COMEY: We have an enormous FOIA operation as you might imagine. It's working, I think, 24 hours a day outside of Washington D.C. Great people who this is their life. They know the regulations, they know the security sensitivities, and work as hard as we can to comply with the FOIA deadlines. It is -- it's a huge pain but it's an essential part of being a public institution.

FLAKE: All right, thank you, Mr. Chairman.

GRASSLEY: Senator Coons.

COONS: Thank you, Chairman Grassley, thank you, Director Comey, for your service and for your return in front of the Senate Judiciary Committee.

I want to start by asking about a letter -- and Mr. Chairman, I'll submit this for the record, if I might. Senator Whitehouse and I in early of August last year sent a letter to our colleague, Senator Cruz, who then served as the Oversight Subcommittee chairman, expressing our grave concern about the potential for foreign interference in our upcoming presidential election.

We asked for an oversight hearing to consider whether existing federal criminal statutes and court jurisdiction were sufficient to address conduct related to foreign entities posing a threat to our election. We didn't have that hearing, but I'd like to ask you that same question now. Are existing federal criminal statutes sufficient to prosecute conduct related to foreign entities that seek to undermine our elections?

COMEY: I think so is my answer. But someone smarter than I may have spotted something where there's a gap. But my reaction is we have the statutory tools. It's a question of gathering the evidence and then applying it under those statutory tools.

COONS: Well, in response to questions from Senator Sasse and Senator Graham earlier, you stated that you fully expect Russia to continue to be engaged in efforts to influence our elections and you expect them to be back in 2018 and 2020.