[Senate Hearing 112-884]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 112-884
 
            OVERSIGHT OF THE FEDERAL BUREAU OF INVESTIGATION 

=======================================================================

                                HEARING

                               before the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                              May 16, 2012

                               __________

                          Serial No. J-112-76

                               __________

         Printed for the use of the Committee on the Judiciary

                               ----------

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                       COMMITTEE ON THE JUDICIARY

                  PATRICK J. LEAHY, Vermont, Chairman
HERB KOHL, Wisconsin                 CHUCK GRASSLEY, Iowa
DIANNE FEINSTEIN, California         ORRIN G. HATCH, Utah
CHUCK SCHUMER, New York              JON KYL, Arizona
DICK DURBIN, Illinois                JEFF SESSIONS, Alabama
SHELDON WHITEHOUSE, Rhode Island     LINDSEY GRAHAM, South Carolina
AMY KLOBUCHAR, Minnesota             JOHN CORNYN, Texas
AL FRANKEN, Minnesota                MICHAEL S. LEE, Utah
CHRISTOPHER A. COONS, Delaware       TOM COBURN, Oklahoma
RICHARD BLUMENTHAL, Connecticut
            Bruce A. Cohen, Chief Counsel and Staff Director
        Kolan Davis, Republican Chief Counsel and Staff Director



                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Grassley, Hon. Chuck, a U.S. Senator from the State of Iowa......     3
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont.     1
    prepared statement...........................................    42

                               WITNESSES

Witness List.....................................................    41
Mueller, Robert S. III, Director Federal Bureau of Investigation, 
  U.S. Department of Justice, Washington, DC.....................     5
    prepared statement...........................................    44

                               QUESTIONS

Questions submitted by Senators Patrick Leahy, Charles Schumer, 
  Chuck Grassley, and Lindsey Graham for Hon. Robert S. Mueller 
  III............................................................    57

                                ANSWERS

Responses of Robert S. Mueller III, to questions submitted by 
  Senators Leahy, Schumer, Grassley, and Graham..................    64

                MISCELLANEOUS SUBMISSIONS FOR THE RECORD

Durbin, Hon. Richard J., a U.S. Senator from the State of 
  Illinois, March 27, 2012, letter...............................    78
Mueller, Robert S. III, Director Federal Bureau of Investigation, 
  U.S. Department of Justice, Washington, DC., April 17, 2012, 
  letter.........................................................    81
Federal Bureau of Investigation, Counterterrorism Training 
  Material Review................................................    83


            OVERSIGHT OF THE FEDERAL BUREAU OF INVESTIGATION

                              ----------                              


                        WEDNESDAY, MAY 16, 2012

                                       U.S. Senate,
                                Committee on the Judiciary,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 10:06 a.m., in 
Room SD-226, Dirksen Senate Office Building, Hon. Patrick J. 
Leahy, Chairman of the Committee, presiding.
    Present: Senators Leahy, Kohl, Feinstein, Schumer, Durbin, 
Whitehouse, Klobuchar, Coons, Blumenthal, Grassley, Hatch, Kyl, 
Graham, and Lee.

OPENING STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR FROM 
                      THE STATE OF VERMONT

    Chairman Leahy. These photographers are all good people, I 
have been told by my son-in-law, who used to work with them. Of 
course, I have a certain amount of jealousy because they have 
the job that I really want to have, except that they are a lot 
better at it than I would be. So I had to take the Senate as a 
second choice.
    Senator Grassley, Senator Hatch, Senator Klobuchar, and 
Senator Coons are here, and we can begin.
    It is appropriate that we welcome Director Robert Mueller 
of the Federal Bureau of Investigation back to the Committee 
during National Police Week. He and I were at the National 
Peace Officers Memorial Service with President Obama at the 
Capitol yesterday, as were others. And one of the things we 
talked about before, several of us did, is that every year we 
are losing too many fine law enforcement officers in the line 
of duty. It is a matter that is of great concern to me. It 
would be one thing if they were all being targeted by a 
particular organization. That does not seem to be the thing, 
that these are disconnected and happening in all parts of the 
country. But we are losing far too many police officers.
    I know Director Mueller is keenly aware of their sacrifice 
and is focused on how best to protect those people who protect 
us. And I do thank him and the hard-working men and women of 
the FBI who work every day to keep us safe, just as I make it a 
point to thank the police officers here on Capitol Hill who 
keep us safe. But I worry about their safety, too.
    Now, in the years since September 11th, the FBI has played 
an increasingly important role in our Nation's counterterrorism 
and intelligence-gathering efforts. Together with prosecutors, 
other law enforcement partners, and the intelligence community, 
the FBI has helped obtain hundreds of terrorism convictions in 
our federal courts.
    Earlier this month, for example, a federal jury in New York 
handed down a guilty verdict in one of the most serious 
terrorism plots since 9/11, which involved plans to carry out 
suicide bombings in the New York subway in 2009. I might say, 
contrary to the predictions of some, this major terrorism trial 
proceeded without a hitch in a federal court in the heart of 
New York City. There was hardly any disruption of the lives of 
New Yorkers who live and work near the courthouse, and they 
were convicted.
    The defendant was convicted without the need for mandatory 
military custody or interrogation, certainly without the need 
for indefinite detention at Guantanamo Bay or elsewhere. He is 
going to be sentenced later this year. He faces life 
imprisonment. But it is only the latest example--and there are 
many, many, many of them--of federal law enforcement, 
prosecutors, and criminal courts successfully investigating and 
trying terrorism cases. In recent years, the Christmas Day 
bomber and the Times Square bomber were convicted and sentenced 
to life imprisonment after the FBI used its expertise and 
experience to obtain statements after giving Miranda warnings, 
and they did all that without resorting to torture, and not 
only got a great deal of information, some of which we cannot 
go into in an open session, but they also got convictions.
    In contrast, the military commissions proceedings against 
the 9/11 plotters are just beginning at Guantanamo Bay. And we 
know there is going to be lengthy litigation concerning the 
torture and mistreatment of certain defendants. The trial 
itself will not start until sometime next year, unlike those 
trials that have already been completed, and people are being 
sentenced. Moreover, as Director Mueller pointed out last year 
during the debate over the defense authorization bill, 
mandating military custody in these situations merely hampers 
the FBI's ability to react swiftly and flexibly in gathering 
intelligence and evidence. That is one of the reasons why I 
have joined Senator Mark Udall in cosponsoring the Due Process 
and Military Detention Amendments Act, which would repeal that 
mandatory military detention requirement.
    In the coming months, I also look forward to speaking with 
the Director about the administration's request for 
reauthorization of FISA. I certainly appreciate the importance 
of providing the intelligence community with appropriate 
surveillance tools to help protect our country against 
terrorist threats. But we have to be sure that we are 
conducting sufficient oversight to ensure that we protect the 
privacy rights and civil liberties of law-abiding Americans. 
That is what I tried to do when we reauthorized certain 
provisions of the USA PATRIOT Act, and I am disappointed that 
common-sense, bipartisan improvements were ultimately not 
enacted. As Congress considers the administration's request to 
reauthorize the FISA Amendments Act, I will look at whether we 
should strengthen accountability or privacy or liberty 
protections in the various parts of it.
    Now, while faced with daunting national security 
challenges, Director Mueller has also ensured that the FBI has 
maintained its historic focus on fighting crime. At a time of 
economic crisis and shrinking State and local law enforcement 
budgets, many expected violent crime to skyrocket. Instead, 
crime rates across the country have continued to decline. Along 
with the commitment of the President and the Congress to 
continued federal assistance to State and local law 
enforcement, the dedicated service of FBI agents throughout the 
country has played an important role in helping to keep these 
crime rates low and keep Americans safe.
    The FBI and the Justice Department have worked hand in hand 
with us to make great strides toward more effective fraud 
prevention and enforcement. In the last Congress, I worked hard 
with both Republican and Democratic Senators to craft and pass 
the Fraud Enforcement and Recovery Act, the most expansive 
anti-fraud legislation actually in more than a decade. We 
enacted important anti-fraud provisions as well as part of both 
the Affordable Care Act and Wall Street reform legislation. And 
I must say, Director, I am pleased to see that the FBI has 
greatly increased the number of agents investigating fraud. 
There is not only the advantage of recovering money, but it 
also has to have a great deterrent effect. These new agents and 
laws have led to record fraud recoveries and increased fraud 
arrests and convictions.
    I commend the FBI for also continuing to combat corruption. 
We should pass common-sense, bipartisan legislation like the 
Fighting Fraud to Protect Taxpayers Act and the Public 
Corruption Prosecution Improvements Act to give you more tools 
to fight this scourge.
    [The prepared statement of Senator Leahy appears as a 
submission for the record.]
    So, Director, while my voice is still working with all the 
pollens in here, I will yield to Senator Grassley.

STATEMENT OF HON. CHUCK GRASSLEY, A U.S. SENATOR FROM THE STATE 
                            OF IOWA

    Senator Grassley. Chairman Leahy, thank you. Thank you, 
Director Mueller, for coming.
    The Chairman paid tribute to Police Week, so I will not 
repeat those words, but I certainly agree with everything that 
the Chairman said.
    It has been six months since our last hearing. On a 
housekeeping matter, the FBI has been improving response time 
to our requests for information, but there is still too long of 
a wait for some written responses. And yesterday afternoon, we 
received some answers to questions for the record from six 
months ago when the Director testified.
    I want to know what efforts the FBI has undertaken to 
investigate the serious and grave national security leak 
surrounding the recently revealed operation in Yemen. National 
security leaks have, unfortunately, become the norm with far 
too much sensitive information being leaked about ongoing 
operations. They are dangerous and have grave consequences. 
They threaten sensitive sources and methods and endanger life 
and complicate relationships with our allies. So I hope to hear 
from the Director what the FBI is doing to investigate that 
leak and bring people to justice.
    Next, there are a couple pressing national security policy 
matters that we need to address in the Senate. As the Director 
pointed out in written testimony, the FISA Amendments Act 
expires at the end of the year. This critical national security 
tool needs to be reauthorized, and I would like to hear from 
the Director about the urgency in pushing that reauthorization.
    The Communications Assistance for Law Enforcement Act is 
important. We have been waiting patiently for the 
administration to put forth a proposal with necessary fixes to 
ensure that the going-dark problem is addressed. This needs to 
be addressed in a correct manner. There is a lot of 
misinformation on this issue floating around, and the sooner we 
have a proposal, the sooner we can work to dispel those 
misconceptions.
    For starters, it is not a plan for the Government to take 
over the Internet or other mediums. It involves compliance with 
valid, lawfully issued court orders. Simply, it is about 
ensuring that when a court issues an order, law enforcement can 
obtain the information the court authorizes. I want the 
Director to give us the status on this proposal and when the 
administration plans to send something up to the Hill.
    Another critical national security issue to address is 
cybersecurity. The House has passed four separate bills in this 
area. There are a number of other bills pending before the 
Senate. While a lot of attention has been focused on 
differences between these bills, the proposals do have much in 
common. All the proposals recognize the need to strengthen the 
Nation's cybersecurity defenses. Where they differ is how to do 
it, so I hope the Director can fill us in on concerns that I 
have with proposals that create new bureaucracies to deal with 
cybersecurity. I will ask the Director about the danger of 
compartmentalizing cybersecurity-related threat information and 
whether such efforts would lead to reconstituting the wall 
between national security and criminal matters.
    Aside from national security, the FBI continues to handle a 
significant caseload of traditional criminal matters. One 
matter of concern is a recent report in the Washington Post 
about a number of cases where individuals may have been 
convicted based upon faulty FBI crime lab reports. This issue 
dates back to the 1990s when I conducted oversight work on the 
FBI crime law, when they spent $1 million to settle with a 
whistleblower, build a new lab. I am interested in--what is 
concerning me is that the recent reports indicate that the 
Justice Department's review of these cases may have been 
incomplete and that defendants in cases may not have been 
notified about problems. It is troubling. However, what is even 
more troubling is that it appears the Justice Department never 
made public the findings of the report, nor does it appear 
these findings were reported to Congress.
    Given the high-profile problems with disclosing exculpatory 
evidence and serious misconduct by FBI and DOJ officials in the 
prosecution of Senator Stevens, this report has raised a number 
of questions. I want to hear from the Director what he has done 
as part of this review and what is being done to address these 
cases.
    Time permitting, there are a number of other topics. I 
remain concerned that whistleblowers at the FBI face 
retaliation and delays in clearing their names. Just yesterday 
we received written responses from the Director's last 
appearance where he addressed the long-running whistleblower 
cases of Turner and Kobus. These cases have languished at the 
Justice Department for many years despite clear findings of 
retaliation for protected whistleblowing, nearly 10 years in 
the Turner case and four years for Kobus. So, obviously, I am 
disappointed in the Director's written answers. They fail to 
answer the basic question about when these matters will come to 
an end and are chock full of legalese. They do nothing to bring 
closure to these matters, which I consider a black eye for the 
Bureau. In fact, one response states that the Director cannot 
answer because of ongoing litigation. So, note, the litigation 
is only ongoing because the FBI continues to appeal the case. 
At some point the FBI needs to own up to the retaliation and 
end these cases. That is something within the Director's power, 
something he could and should do immediately.
    Finally, I want to thank the Director for his candor in 
answering one of my written questions about the FBI's attempt 
to overclassify a memorandum provided to us. In a rare 
admission of fault, the written questions noted that the FBI 
erroneously stamped a memo to the Congress as ``sensitive 
security information'' under the Code of Federal Regulations. 
At first glance, this stamp appeared to limit disclosure of the 
memo; however, a closer look revealed the FBI was attempting to 
classify the memo using the authority reserved for the 
Administrator of TSA and Secretary of Transportation. While we 
in Congress understand the need to appropriately classify 
certain information, this was an example of the overreach that 
has made us cynical about overclassification of materials, and 
so I am very happy that the FBI owned up to this erroneous 
classification but worried that it may signal a greater 
problem.
    I look forward to addressing these topics. Thank you very 
much.
    Chairman Leahy. Thank you.
    Director Mueller, please go ahead, sir.

STATEMENT OF THE HON. ROBERT S. MUELLER III, DIRECTOR, FEDERAL 
     BUREAU OF INVESTIGATION, U.S. DEPARTMENT OF JUSTICE, 
                         WASHINGTON, DC

    Mr. Mueller. Good morning, and thank you, Chairman Leahy 
and Ranking Member Grassley and Members of the Committee. I 
want to thank you for the opportunity to appear before the 
Committee today and most particularly thank you for your 
continued support of the men and women of the FBI.
    As you have pointed out, the Bureau has undergone 
unprecedented change in recent years. Since the attacks of 
September 11th, we have refocused our efforts to address and 
prevent emerging terrorist threats, which are more diverse than 
they were 10 years ago. And we also face increasingly complex 
threats to our Nation's cybersecurity as nation state actors, 
organized criminal groups, and hackers for hire are stealing 
trade secrets and valuable research from America's colleges, 
America's companies, and our government agencies. And, of 
course, we must also combat investment fraud, health care 
fraud, and mortgage fraud that have undermined the world's 
financial system and victimized investors, homeowners, and 
taxpayers.
    And while crime may be down nationwide, as you pointed out, 
Mr. Chairman, gang violence still plagues far too many 
neighborhoods. And to combat these threats, we in the Bureau 
are relying on our law enforcement and private sector partners 
more than ever. And throughout these efforts, the FBI remains 
firmly committed to carrying out our mission while protecting 
the civil liberties of the citizens we serve.
    Let me begin with the threat from terrorism, which does 
remain and still remains our top priority. Al Qaeda is 
decentralized, but the group is committed to high-profile 
attacks against the West, as we confirmed from the documents 
seized from Osama bin Laden a year ago. Meanwhile, Al Qaeda 
affiliates, especially Al Qaeda in the Arabian Peninsula, 
represent the top counterterrorism threat to the Nation. AQAP 
has attempted several attacks on the United States in 2009 and 
2010, and we are currently exploiting an IED seized overseas, 
which is similar to explosive devices used by AQAP in the past.
    We also remain concerned about the threat from homegrown 
violent extremists. These individuals have no typical profile; 
their experiences and motives are often distinct, which makes 
them difficult to find and difficult to stop.
    Let me turn next to counterintelligence. We still confront 
traditional espionage. Today's spies are also students, 
researchers, business people, or operators of ``front 
companies.'' They seek not only state secrets but also trade 
secrets, intellectual property, and insider information from 
government, businesses, and American universities.
    We are also seeing a growing ``insider threat''--that is, 
when employees use their legitimate access to steal secrets for 
the benefit of another company or country. And, of course, the 
counterintelligence threat is now merging with the cyber 
threat. Today so much sensitive data is stored on computer 
networks, our adversaries often find it as effective, or even 
more effective, to steal secrets through cyber intrusions.
    We in the FBI have built up a substantial expertise to 
address the cyber threat, both here at home and abroad. We have 
cyber squads in each of our 56 field offices, with more than 
1,000 specially trained agents, analysts, and forensic 
specialists. And we have 63 legal attache offices that cover 
the globe to also assist in addressing this threat.
    And, finally, the National Cyber Investigative Joint Task 
Force brings together 20 law enforcement, military, and 
intelligence agencies to stop current and predict future cyber 
attacks.
    Next, let me address our efforts to combat financial 
crimes. The FBI and its partners continue to focus on the 
financial executives who have committed securities and other 
frauds. From 2009 to 2011, there have been more than 254 
executives charged with corporate fraud. And last year alone, 
FBI investigations led to more than 1,100 convictions for 
mortgage fraud. In addition, over the past four years, we have 
nearly tripled the number of special agents investigating 
mortgage fraud and other white-collar frauds.
    Among them is health care fraud. Health care spending 
currently makes up about 18 percent of our Nation's total 
economy, which presents an attractive target to criminals, so 
much so that we lose tens of billions of dollars each year to 
health care fraud.
    As announced two weeks ago, the FBI, HHS, and the Justice 
Department continue to bring a record number of cases involving 
hundreds of millions of dollars in Medicare fraud. Indeed, 
since their inception in March 2007, Medicare Fraud Strike 
Force operations in nine locations have charged more than 1,300 
defendants who collectively have falsely billed the Medicare 
program for more than $4 billion.
    And crime on our streets remains as much of a threat to our 
overall security as terrorism, espionage, or cyber crime. And 
the most recent Uniform Crime Report does indicate violent 
crime continues to fall. But as we all know, this does not 
represent every community. For some cities and towns across the 
Nation, violent crime--including gang activity--continues to 
pose a real problem.
    We also continue to confront organized crime. Today's 
organized crime operates multinational, multibillion-dollar 
schemes, everything from human trafficking to health care 
fraud, and from computer intrusions to intellectual property 
theft.
    The FBI remains vigilant in its efforts to keep children 
safe and to find and stop child predators. Through our Child 
Abduction Rapid Deployment Teams, the Innocence Lost National 
Initiative, our Office of Victim Assistance, and numerous 
community outreach programs, the FBI and its partners are 
working to make the world a safer place for our children.
    Chairman Leahy and Ranking Member Grassley, I thank you for 
this opportunity to discuss the FBI's priorities, and the 
transformation the FBI has achieved over the past 10 years 
would not have been possible without your support. I would be 
happy to answer any questions that you might have.
    [The prepared statement of Mr. Mueller appears as a 
submission for the record.]
    Chairman Leahy. Director, before we came in here, you and I 
discussed the question of forensics, and as you know, the 
Washington Post recently reported that a review of potential 
errors in hair and fiber analysis by FBI forensics experts 
revealed hundreds of mistakes in the 1980s and the 1990s, but 
that many of these mistakes were not disclosed to the people or 
their defense attorneys. The Post reported the review was very 
narrow and the evidence in the cases were not retested despite 
questions about techniques of the lab personnel.
    Now, we have had a lot of attention in this Committee over 
the years, from both parties, about this. Your predecessor said 
these problems have been corrected, but what actions are being 
taken? Do you have a way to ensure that all questionable 
evidence is retested? Are there ways of making sure that 
notifications are made so that nobody remains in jail based on 
faulty evidence?
    Mr. Mueller. Mr. Chairman, there was a review done 
previously back--it culminated in 2004, which covered the lab 
that was headed by the Justice Department and, of course, we 
participated and cooperated in that review. Of the 13 examiners 
that were the subject of that review, only one was a hair and 
fiber analyst. And upon indications that some of those 
examiners who examined particular hair may have overstated the 
import of their examinations, the Justice Department, with 
ourselves contributing, is going back to look at what universe 
of persons may have been covered by these examiners, which 
cases may have had occasion where the examiners testified and 
did overstate the import of their examinations, and then to do 
whatever notifications are appropriate given that review.
    At this point in time, we are not certain exactly what the 
universe will be, but we are working to determine that universe 
and make certain that we go back and identify those cases that 
need a further review.
    The only other thing I would add is that in 1996--prior to 
1996, we did not have DNA, but in 1996, we developed the 
mitochondrial DNA examination, which thereafter was done in 
conjunction with any hair and fiber examination that we had 
conducted.
    Chairman Leahy. It is not just the DNA, and I realize we 
have got new--new techniques come up all the time. I just 
wanted to make sure that we are doing it the best possible way 
because, whether it is federal prosecutors or State 
prosecutors, if they are relying on something from the FBI in 
testimony, and the courts are, we do not want to come back 
later on and have to say, wait a minute, this just did not 
work, because that is going to put in doubt prosecutions and 
everything else everywhere else.
    So I introduced the Criminal Justice and Forensic Science 
Reform Act. This would be for a nationwide forensics reform 
act, including research and standards. Would that be something 
that might help?
    Mr. Mueller. I know that there is discussion about 
standardization of forensics. We have some substantial role in 
that now, and my expectation is whatever the administration 
comes out with--and I know it is looking at certain proposals. 
My expectation is we would continue to play a substantial role 
in contributing to the standards when it comes to forensics 
work.
    Chairman Leahy. I am sure you agree with me that, when the 
government has experts testify, that testimony, especially on 
things of a scientific nature, is the best possible.
    Mr. Mueller. Absolutely.
    Chairman Leahy. The questions of eyewitnesses and things 
like that, that is always subjective. But there are certain 
things that should be objective, and we should not have to go 
back afterward and say did that really work that way. I am sure 
you agree with that.
    Mr. Mueller. I do agree with that, and to the extent that 
new forensics testing such as DNA when it comes on is far more 
specific and accurate, we immediately adopt it. In this 
particular case, we need to go back and look at the universe of 
cases that predated the use of the DNA and determine whether 
there are additional notifications that need to be made.
    Chairman Leahy. Please keep this Committee posted as you go 
through that review.
    Mr. Mueller. Yes, sir.
    Chairman Leahy. You and I talked yesterday before the 
National Peace Officers Memorial Service about the number of 
police officers who have been killed: nationwide, 122 in 2009, 
154 in 2010, 163 in 2011. This is a very troubling trend. I 
continue to work on the Bulletproof Vest Grant Program. I have 
been told by police departments all over the country that that 
has saved a lot of lives. I am hopeful that this Committee will 
reauthorize it tomorrow.
    I also understand that domestic violence situations are 
posing special risks to officers. We voted to reauthorize the 
Violence Against Women Act here in the Senate. The House is now 
looking at it.
    Can you think of things that we could be doing here that 
might help?
    Mr. Mueller. Let me just add to the things that are being 
done two additional ones.
    Chairman Leahy. I assume you agree with the----
    Mr. Mueller. Absolutely.
    Chairman Leahy. With the Bulletproof Vest Program.
    Mr. Mueller. Absolutely. The Bulletproof Vest Program has 
saved innumerable lives, and while there was some discussion 
early on about making officers wear them, I think that 
discussion is at an end, given the benefits that everybody sees 
from the use of those vests.
    Two additional things that we are undertaking: We have 
changed our new firearms training for our own agents to reflect 
that many of the confrontations now are a lot closer than 
perhaps they were in the past, and often State and local law 
enforcement follow our lead when it comes to firearms 
practices. Second, we have what we call a Violent Offender 
Alert System with our NCIC. When an agent or an officer stops 
somebody, when they look to determine their history, there will 
be an indication that that individual, that suspect or that 
person that they have detained, has a violent history. And so 
that will put the detaining officer or agent on alert that this 
is something special that you have to be aware of.
    Chairman Leahy. I will accept your invitation to come down 
and see the new firearms training.
    Mr. Mueller. Yes.
    Chairman Leahy. And, last, you have testified before about 
the need for law enforcement to keep pace with developments in 
communication technology and so on. We have CALEA, the 
Communications Assistance Law Enforcement Act, that I drafted 
and helped to enact back in the 1990s. Some have suggested 
updating it. There have been press reports that the FBI is 
seeking to expand CALEA to require Internet service providers 
and other online services make their products amenable to 
Government surveillance and intercept. There have been recent 
published reports about draft legislative proposals 
circulating, although the administration has not sent anything 
up here.
    Should I be expecting a specific legislative proposal from 
the FBI or the administration in the near future?
    Mr. Mueller. I believe you would, but I do believe that 
characterization is somewhat of a distortion of what our needs 
are. As was pointed out by Ranking Member Grassley, we will go 
to court, make the appropriate showing of probable cause that 
there is a need to capture communications of a particular 
individual, and a judge will issue an order.
    What we are seeking is the ability to enforce that order 
and be able to obtain those communications, and what we are 
looking at is some form of legislation that will assure that 
when we get the appropriate court order, that those 
individuals, individual companies that are served with that 
order do have the capability and the capacity to respond to 
that order.
    Chairman Leahy. I think it would clear up a lot of 
confusion about what might be sought if we can actually see a 
proposal from the administration, and I would urge the 
administration to get that before us.
    Senator Grassley.
    Senator Grassley. I had a lead-in to my first question that 
I am going to skip, but it goes back to exactly the first 
question that the Chairman asked.
    Do you know why the Justice Department did not notify 
defense counsel in each case of the task force's findings?
    Mr. Mueller. I am not certain that they did not--I am not 
certain exactly with specificity what the notification 
procedures were back in 2004. I would have to get back to you 
on that, who was notified and who was not notified and the 
circumstances under which a decision was made.
    Senator Grassley. Did the Justice Department share records 
with the FBI about what notifications went to the prosecutor?
    Mr. Mueller. I would have to check on that. I am not 
certain.
    Senator Grassley. Okay. Well, I hope if there is one area 
where we should all be able to agree, it would be on this one, 
that defense counsel ought to be notified or the person that is 
in jail ought to be notified if there is other information that 
might bear on the case. And, Chairman Leahy, I would like to 
work with you to bring some public accountability to this 
process, just as you and I worked together on the Army Crime 
Lab issue a while ago.
    My next question deals with the airplane, but not your use 
of the airplane. It is a sensitive issue with you, so it is not 
about you.
    Mr. Mueller. Yes, sir.
    Senator Grassley. Last month, the Associated Press reported 
that Defense Secretary Panetta incurred $870,000 in personal 
travel to California using a government plane. In accordance 
with OMB policy, Panetta reimbursed the Department for the 
flights, but at a significant discounted market rate. It is my 
understanding that the Attorney General utilizes FBI aircraft 
for official and personal travel. I also understand that the 
FBI is charged for these trips, along with other trips the 
Attorney General takes on non-FBI aircraft, such as DOD and FAA 
planes.
    Does the Attorney General use FBI aircraft for both 
business and personal travel?
    Mr. Mueller. He is required to use FBI--not necessarily 
FBI, but he is required to use government aircraft so that he 
is in continuous contact, communications contact.
    Senator Grassley. Okay. Does the FBI charge the Attorney 
General's use of the FBI plane against its own budget or 
against the Attorney General's own travel budget?
    Mr. Mueller. I do think it goes against our budget, but I 
would have to check on that. The intricacies of the billing 
between the Department of Justice and ourselves for the 
security of the Attorney General I would have to get back to 
you on.
    Senator Grassley. Then the question comes: Why would the 
FBI be paying for this?
    Mr. Mueller. I would have to look at that. There is 
probably historical--or it may be we are responsible for his 
security wherever he is at whatever particular point in time, 
whatever transportation he uses. And how that is specifically 
billed I will have to go and check on.
    Senator Grassley. Okay. And it is my understanding, 
according to my friend on my left here, that this may have been 
a policy going back prior to this administration. If so, I 
still would like that information.
    Then you will not be able to answer this, but I am 
interested in the cost, so include that in your answer to me.
    [The information referred to appears under questions and 
answers.]
    Senator Grassley. And according to information provided me, 
the FBI may have had to lease a private plane because the FBI 
jet was reserved for senior Justice Department officials. Would 
that----
    Mr. Mueller. Both myself and the Attorney General, the 
Department of Justice and FBI, understand that these planes are 
first for investigative work. They are used for 
counterterrorism, criminal cases, and that any travel of the 
principals is secondary to the use of the plane for the 
investigative work of the FBI.
    Senator Grassley. I look forward to your responses to that. 
Thank you.
    Now, on national security leaks, the FBI has reportedly 
opened an investigation into leaks about the recent underwear 
bomb operation. It is my understanding that the information 
that was leaked may have compromised the ability of the CIA and 
our partners to use the same sources and methods for similar 
operations in the future. I am particularly concerned if the 
operation tactics were leaked for political gain, as we have 
seen in the past, with the authorized leaks from the White 
House about the operation to kill Osama bin Laden.
    Do you agree with me that this leak was damaging to our 
national security to fight terrorism?
    Mr. Mueller. Well, let me start by saying that we have 
initiated an investigation into this leak and also affirm, as I 
think you indicated before, that leaks such as this threaten 
ongoing operations, puts at risk the lives of sources, makes it 
much more difficult to recruit sources, and damages our 
relationships with our foreign partners. And, consequently, a 
leak like this is taken exceptionally seriously, and we will 
investigate thoroughly.
    Senator Grassley. Okay. I guess you have answered my 
question there, but the last point that you made was a point I 
wanted you to make, so I guess I would say, regardless of 
political consequences, I hope that you get to the bottom of 
it.
    Our international partners have been wary of cooperating 
with us in the wake of WikiLeaks affair in which our ability to 
keep their confidence was severely damaged. What effect do you 
think the leaks in this case will have on our ability to work 
with allies in combating terrorism?
    Mr. Mueller. My hope is that it will have minimal impact, 
and I know that there are discussions that are going on with 
partners overseas to make certain that whatever impact there is 
is minimized and precautions put into place so that in the 
future does not happen again.
    Senator Grassley. Director Mueller, you have identified 
fighting terrorism as one of the main priorities, and in your 
written statement for this hearing, you identified FISA 
amendments as a crucial part. You have personally encouraged 
the reauthorization of the FAA, and your colleagues in the 
administration, DNI Clapper and Attorney General Holder, have 
sent letters and legislative proposals to accomplish that. I 
agree with you about the value of the FAA tools, and I support 
the clean authorization of FAA.
    Could you please describe exactly why the FAA is so 
valuable? What authority does it provide that other statutes do 
not?
    Mr. Mueller. Well, at base, it provides the authority for 
intelligence agencies to gather or collect information on 
conversations overseas between persons overseas, non-U.S. 
citizens. And that intelligence is tremendously important to 
our ability to analyze and predict threats against United 
States citizens overseas, but also against the United States 
homeland itself. And absent that, we would be in the dark when 
it comes to identifying individuals and threats from numerous 
countries overseas that harbor, willingly or unwillingly, 
persons who want to do us harm.
    One example I could give is the Najibullah Zazi case, which 
has been described by the Chairman as a recently--an aspect of 
it that was recently concluded in convictions in New York. That 
is a case that benefited dramatically from the benefits of the 
FAA.
    Many of the other benefits would have to be discussed in a 
closed session.
    Senator Grassley. Could I have just one short follow-up?
    A two-part follow-up: Is it critical that we reauthorize 
FAA this year? And is there sufficient oversight and checks and 
balances to ensure that the rights of U.S. citizens are 
protected?
    Mr. Mueller. Well, yes, it needs to be done this year so we 
are not in limbo as we have been in the past awaiting 
legislation, and hopefully not having it be carried for a month 
or so. But, absolutely, it is important that we get it and we 
get it quickly.
    What was the second part of the question, sir?
    Senator Grassley. Is there sufficient oversight and 
checks----
    Mr. Mueller. Yes.
    Senator Grassley [continuing]. To ensure the rights of U.S. 
citizens being protected?
    Mr. Mueller. Yes, I do believe there is. I know the 
Inspector General's offices are very active in this, and also 
the Intelligence Committees as well as this Committee in terms 
of giving oversight to this particular program, and to assure, 
to the extent one can, that it is focused on those individuals 
who are communicating overseas and who are not U.S. citizens.
    Senator Grassley. Thank you very much.
    Chairman Leahy. Thank you.
    Senator Kohl.
    Senator Kohl. Thank you, Mr. Chairman.
    Director Mueller, before I turn to my questions, I would 
like to thank you for your work to keep open the La Crosse, 
Wisconsin, FBI satellite office that, as you know, had been 
slated for closure. This decision will allow the FBI to do a 
better job at protecting western Wisconsin and continue the 
strong local and federal law enforcement partnership there. I 
appreciate your willingness to be attentive to my interest in 
this issue.
    Director Mueller, as we all know, this is National Police 
Week, and yesterday we honored officers who made the ultimately 
sacrifice. Included in the dozens of names to be added to the 
National Law Enforcement Officers Memorial this year is Officer 
Craig Birkholz of the Fond du Lac, Wisconsin, Police 
Department.
    As we remember the sacrifices of these brave men and women, 
we need to ensure that law enforcement officers have the 
federal support and the resources they need to keep our 
communities safe.
    Director Mueller, last week at a House hearing, you said 
that because of the FBI's realignment in priorities toward 
counterterrorism and limited resources, the FBI will have to 
``prioritize in other areas, and particularly in the criminal 
area they will suffer.'' Could you elaborate a bit on that 
comment?
    Mr. Mueller. Yes, I actually think that the question was 
directed on the impact of sequestration on the Bureau. I think 
the question was something along the lines of, what impact 
would sequestration have on the Bureau and how will you handle 
it? To which my response was that it will cut across all of our 
programs. It actually will--we will have to take a seven- to 
eight-percent cut across the boards, and when we do that, we 
have to prioritize. And the priorities we have are 
counterterrorism, counterintelligence, espionage is number two, 
and cyber are the three top national security, and you cannot, 
particularly in the cyber realm, cut there. So you have to look 
for cuts in the criminal programs.
    Where we would end up doing it, I do not know, but one has 
to prioritize. We will lose something in the neighborhood of 
1,500 personnel if sequestration goes there. That will be 
several hundreds of agents, almost 1,000 analysts, and almost 
900 professional staff. It will be a very hard hit.
    My answer was in response to a question about what would 
happen if sequestration follows.
    Senator Kohl. How hard a hit will it be, in your judgment, 
with respect to your ability to do the job that the FBI is 
required to do?
    Mr. Mueller. Well, there will be gaps in what we are going 
to do. We will probably have to ratchet back in the white-
collar criminal program. We have got thousands of agents now 
looking at health care fraud, mortgage fraud, securities fraud, 
and corporate fraud.
    In terms of addressing gang violence around the country, we 
probably will have to cut back in terms of our task forces.
    Our belief since September 11th has been we maximize our 
capabilities when we work in the context of task forces, so we 
have established hundreds of Safe Streets Task Forces where we 
will have one or two or three agents, but we will leverage our 
capabilities with State and local law enforcement. We will have 
to cut back in these areas, and that will have, I believe, an 
impact on those communities that do not have the capabilities 
of the Bureau leveraged with the State and local law 
enforcement to address violent crime on our streets.
    Senator Kohl. Director Mueller, last month Al Qaeda in 
Yemen recruited a suicide bomber to blow up a U.S.-bound 
airplane with a sophisticated explosive device. Fortunately, 
the would-be bomber was actually an informant working for Saudi 
Arabian intelligence and the CIA. This was a tremendous victory 
for the United States intelligence. We were able to unravel a 
major terrorist plot, recover a newly devised weapon, and 
obtain valuable intelligence.
    But there appears to be a question as to whether this 
explosive device would have been detected by our current 
airport security screening. Even if our more sophisticated body 
scanners were able to detect it, not all domestic airports and 
only some international airports with U.S. inbound flights use 
them.
    What are counterterrorism officials, including the FBI, 
doing to ensure that these types of devices do not make it onto 
airplanes?
    Mr. Mueller. Let me start by saying I have to--in this 
session, I cannot affirm the predicate for the question. I 
understand the question with regard to the device. What we are 
doing is working with TSA in particular to assure that any 
information we have which would bear on TSA and Department of 
Homeland Security's ability to pick up these devices is in 
their hands, so that we can make certain that we have the 
capability of alerting on these devices should another one 
appear.
    Senator Kohl. Director Mueller, while counterterrorism 
remains, as you have said, your number one priority, the FBI 
also plays a central role in protecting American innovation and 
businesses from the serious threat of trade secret theft and 
economic espionage, which you referred to and which you 
estimated cost businesses billions of dollars every year. I am 
pleased that the FBI and relevant divisions within the Justice 
Department have increased the number of investigations by some 
29 percent in the last year. This big jump in the number of 
investigations suggests that the problem may be even greater 
than we had previously thought.
    Given the increase of investigations and the ever-growing 
threat to American businesses, jobs, and our economy, do you 
have the needed resources to continue to step up enforcement of 
economic espionage and trade secret theft? Can we expect to see 
an increase in these investigations and prosecutions?
    Mr. Mueller. An increase in investigations and prosecutions 
follows an increase in personnel. We have now over 50 
individuals who are focused solely on these particular cases. 
We quite obviously have to prioritize the cases we tackle. One 
of the major ones we had over the last year was Megaupload, the 
takedown, as I think you are familiar with, of individuals in 
New Zealand. But we are utilizing those personnel to focus on 
the most egregious cases that we find and particularly those 
cases which could result in harm to persons if there are false 
or inadequately manufactured products that are being sold.
    But going back to your point, this is a huge area. I cannot 
purport to say that we are making a huge impact on it. It would 
take additional resources. But we have to prioritize and lock 
people up as a deterrent to others engaging in this same 
activity.
    Senator Kohl [presiding]. Thank you.
    Senator Hatch.
    Senator Hatch. Well, thank you, Mr. Chairman. Welcome, Mr. 
Director. I personally have appreciated your service over all 
these years. You were nominated by President Bush for a 10-year 
term. In 2001, you were subsequently and unanimously confirmed 
by the Senate in September 2001. Your 10-year term was set to 
expire on September 4, 2011, but it was extended for an 
additional two years. I think that was a good thing to do.
    Now, if I had my way, we would keep you right where you 
are. I understand----
    Mr. Mueller. My wife is not hearing this.
    Senator Hatch. Since your term will expire next September, 
have you had any discussion with President Obama about 
potential successors?
    Mr. Mueller. I am sorry, sir?
    Senator Hatch. Have you had any discussions with President 
Obama about potential successors?
    Mr. Mueller. I have in the past, but not very recently.
    Senator Hatch. Do you have a transition plan in place for 
your successor?
    Mr. Mueller. Yes, we had put a plan in place so that we 
would be prepared for the new individual when that individual 
comes on board, and we are preparing for 2013 when we would 
expect a new individual to take the helm.
    Senator Hatch. I figured you would.
    Now, a great deal of attention has been paid to the case of 
Ali Musa Daqduq. He is a Lebanese national and Hezbollah field 
commander with ties to Iran. This terrorist orchestrated a 
brazen, botched kidnapping attempt in Karbala, Iraq, in 2007 
which led to the death of five uniformed U.S. military 
personnel. Daqduq was in the custody of the United States 
military in Iraq from March 2007 until December 2011, when he 
was transferred to the custody of the Iraqi Government.
    A New York Times report from May 7, 2012, indicates that an 
Iraqi court has ordered the release of Daqduq, citing 
insufficient evidence to prosecute him. The New York Times has 
also reported earlier this year that Daqduq has been charged 
with war crimes, including murder, terrorism, and espionage, 
before a U.S. military commission.
    Is the FBI actively engaged with appropriate military 
officials on a plan to provide all necessary support and 
documents that would be needed for the prosecution of Daqduq 
before a military commission?
    Mr. Mueller. Well, yes, not only would we be willing and 
able to cooperate with a military commission if we obtain 
custody of Daqduq; in the meantime, however, we have cooperated 
with the Iraqi authorities in providing intelligence and 
information for their proceedings in Iraq with some of our 
agents testifying by civits in those proceedings. So we have 
tried to provide that information that we have to the Iraqi 
authorities in support of the Iraqi authorities' charges 
against Mr. Daqduq.
    Senator Hatch. Okay. And you are going to follow up on 
that?
    Mr. Mueller. We will.
    Senator Hatch. Okay. Your agency is conducting the 
investigation into the death of Border Patrol Agent Brian Terry 
on December 14, 2010. It has been a year and a half since this 
investigation began. In October 2011, Ranking Member Senator 
Grassley and House Oversight and Government Reform Committee 
Chairman Darryl Issa wrote to you inquiring about the status of 
that investigation, the number of weapons at the scene of the 
murder, and ballistic tests performed on the weapons recovered 
at the scene of the crime.
    Now, your agency did not respond until May 4, 2012, and the 
FBI's response only indicated that press reports of a third 
weapon were inaccurate. There was no response to the other 
questions to include the status of the investigation. Can I ask 
you, what is the status of that investigation?
    Mr. Mueller. I can tell you it is an ongoing, very active 
investigation. Because of the seriousness of the offense and 
the loss of Agent Brian Terry, any personnel that are needed, 
it gets top priority. Because it is an ongoing investigation, I 
cannot get into the details. We have, when there has been a 
misperception out there of the facts of the case, tried to 
right them in the sense that there was a belief that there may 
have been a third weapon at the crime scene, and indeed there 
was not. There were two weapons recovered at the crime scene.
    But going in at this point in time while the investigation 
is ongoing, it would be difficult to get into further details 
in this forum.
    Senator Hatch. Would you be willing to tell us who at the 
Department of Justice is responsible for overviewing that 
particular situation?
    Mr. Mueller. Is the Department of Justice--in terms of 
prosecution, yes, it would be the Department of Justice that 
takes----
    Senator Hatch. I am talking about who actually participated 
there in coming up with the idea and following through and 
giving these weapons to these----
    Mr. Mueller. Well, that would get into the details of the 
investigation, which I----
    Senator Hatch. So you cannot get into that?
    Mr. Mueller. I cannot get into that here, sir.
    Senator Hatch. Okay. You cannot tell us who at the 
Department of Justice was in charge of the----
    Mr. Mueller. I am not certain of the particular Assistant 
United States Attorney that is in charge. I am quite certain 
the Criminal Division would be in charge, but I know this 
investigation is a high priority for all levels of the 
Department of Justice and the FBI.
    Senator Hatch. Okay. Well, the FBI has done great work in 
community outreach, particularly relating to fostering a 
relationship based on shared security goals. And given that the 
Federal Government has intruded into many aspects of our lives 
over the years, it is imperative that federal law enforcement 
carefully and continually articulate that the FBI is there to 
protect them, not police them for ordinary lawful conduct.
    I want to bring to your attention a series of flyers from 
various FBI Joint Terrorism Task Forces. One of the flyers, 
which has received a great deal of attention, lists potential 
indicators of terrorist activities related to military surplus 
stores. Now, according to the flyer, customers who should be 
considered suspicious include those who demand identity private 
sector, insist on paying with cash, make bulk purchases of 
Meals Ready to Eat--MREs, in other words--and purchase 
weatherproof ammunition. Needless to say, there are many 
Americans who this could apply to who have nothing whatsoever 
to do with terrorism, and they are rightfully concerned with 
this type of government decree.
    Now, on the bottom of the flyer in the smallest print 
possible, the document reads: ``Each indicator by itself is a 
lawful conduct and may constitute the exercise of rights 
guaranteed by the U.S. Constitution.''
    I think that disclaimer should have been very prominent and 
not hidden at the bottom of the page, and I think that this 
flyer and others like it needlessly send mixed messages and 
have raised alarm among citizens.
    Can you confirm that the FBI is not looking at people who 
undertake such normal activities? And will you take an active 
role in the future by reviewing similar documents from FBI 
entities before they are released?
    Mr. Mueller. I will. We will. But I do want to put it in 
context. We do have what we call ``tripwires'' out there. For 
instance, at farm supply stores, ammonium nitrate, if somebody 
buys a substantial amount of ammonium nitrate far beyond what 
you would want for your garden or your fields, that is the type 
of thing we need to know about.
    Senator Hatch. Right.
    Mr. Mueller. Other chemical, chemical companies, where 
persons are making purchases that are highly unusual. We had a 
circumstance where an individual down in Texas who was in the 
midst of constructing an IED purchased chemicals from a company 
that I believe was in Georgia or South Carolina. The company 
came to us and said this is highly unusual, and as a result of 
that tip, we were able to disrupt a substantial plot.
    So we have a process out there. Clearly, having ammonium 
nitrate or camping gear in the lot in and of itself is not a 
crime. But I will--and I just came back to your question--go 
and review, have a panel review these to make certain that they 
are done appropriately.
    Senator Hatch. Thanks, Mr. Director. I appreciate your 
service. You have given long and great service to this country. 
I appreciate it.
    Mr. Mueller. Thank you.
    Chairman Leahy [presiding]. Senator Feinstein.
    Senator Feinstein. Thank you very much, Mr. Chairman.
    Director Mueller, as Senator Hatch pointed out, you have 
served both a Republican and a Democratic administration. I 
have watched you carefully. You have never disappointed, and I 
think that is very impressive. I do not know whether this is 
going to be your last appearance before this Committee in the 
form of an oversight hearing or not, but I did want to say that 
to you directly.
    Mr. Mueller. Thank you.
    Senator Feinstein. You are welcome.
    As you know, Title VII of FISA, the Foreign Intelligence 
Surveillance Act, expires December 31st of this year. This 
particular title allows for electronic surveillance of targets 
outside of the United States. The Senate Intelligence 
Committee, as well as this Committee, has done extensive 
oversight over the Government's use of these surveillance 
authorities, and we look forward to working with you to 
reauthorize the FISA Amendments Act well before the end of this 
year.
    I think we need to look no further than the recent AQAP 
bomb plot to know that the threat is still out there. As you 
said, it is very real, and there is no question that they will 
attack this country if they can.
    For the benefit of Members and so that the American people 
can hear directly from you about this intelligence collection 
activity, can you please explain the need to reauthorize Title 
VII of the Foreign Intelligence Surveillance Act?
    Mr. Mueller. If we learned one thing on September 11th and 
one thing only, it was the need to share intelligence and 
gather intelligence to identify persons who would kill American 
citizens, whether it be here domestically or overseas. The 
shock of September 11th in part was attributable to the fact 
that these were individuals from outside the United States who 
were radicalized, who plotted, who then undertook the attack in 
the United States.
    We cannot wait until the attackers are on the shores of the 
United States to preempt plots such as the plot that was 
preempted last week. We cannot wait until that person gets on 
the plane and is over U.S. territory in order to try to stop 
that plot. We have to know what is happening in Yemen; we have 
to know what is happening in the Fatah and Pakistan and 
Afghanistan; we have to know what is happening in Somalia; we 
have to know what is happening in Algeria and Morocco, because 
in each of these places there are pieces of Al Qaeda that are 
operating and are seeking to attack us domestically.
    One of the key areas of insight into these activities is 
our ability to intercept conversations in a variety of media 
today and with the intercepted conversations, get a picture, an 
idea of what plotting is occurring overseas.
    If you take that away from us, if you take that picture 
away from us, if you take away from us the ability to gather 
this kind of information, then we will be defenseless until a 
person crosses our borders, and we cannot allow that to happen.
    Senator Feinstein. Well, thank you very much. One of your 
legacies, of course, is going to be that you have put in place 
a very large intelligence component within the FBI. I gather it 
is above 10,000 people now working in intelligence. What is the 
actual number?
    Mr. Mueller. We have approximately 3,000 analysts, but all 
of our 14,000 agents now, in the intelligence community, you 
would call them ``collectors.'' We call them ``agents.'' But at 
the same time, they are collecting--whatever they do, they are 
collecting information. And whereas for the most part in the 
past we would focus on is it admissible in court, now it is 
information that is collected to fill gaps. What do we know 
about this particular threat to the United States? And what do 
we not know, and how do we fill those gaps?
    And so, on the one hand, yes, we have 3,000 analysts. That 
has tripled since 2001. But also the organization as a whole 
understands that we address a threat. It is not just locking up 
people; it is not just putting people away; but it is 
understanding the threat and preempting the individuals who 
want to attack.
    Senator Feinstein. Do you know whether a crimes report has 
been filed with the Department of Justice pursuant to the AQAP 
bomb retrieval and the leak?
    Mr. Mueller. I am not certain--you describe a crimes 
report. There have been, I know, discussions between ourselves 
and other agencies as the necessity for and investigation on 
the leak. And as I have said, we have initiated an 
investigation.
    In terms of reporting, we, as I think has been indicated, 
had the responsibility of exploiting the IED device, and 
whatever reporting has come out of that has gone to not only 
the Department of Justice but other agencies.
    Senator Feinstein. You have a counterterrorism special 
agent working out of Los Angeles that has been missing for five 
days now.
    Mr. Mueller. Yes.
    Senator Feinstein. What can you tell us about that?
    Mr. Mueller. We are still searching for that individual. 
His wife and the office sought yesterday to widely publicize 
the fact that he is missing. There have been searches made in 
those areas where this individual, this agent, would often run 
or hike. We are still searching.
    Senator Feinstein. Thank you.
    On Sunday, Hank Crumpton, whom you probably know, the 
former head of the CIA's National Resources Division, was 
interviewed on ``60 Minutes.'' When asked about 
counterintelligence--and I want to quote him--this is what he 
said: ``If you look at the threat that is imposed on our Nation 
every day, some of the major nation states, China in 
particular, very sophisticated intelligence operations, very 
aggressive operations against the United States. I would hazard 
to guess that there are more foreign intelligence officers 
inside the U.S. working against U.S. interests now than even at 
the height of the Cold War.''
    Now, I know there is a limit to what you can say before 
this Committee, but how would you respond to that statement?
    Mr. Mueller. I think it is difficult to say, but I do 
believe the counterintelligence threat has evolved over a 
period of time. More generally, certain countries use far 
greater dispersal of individuals, and then as I mentioned in my 
opening remarks, the fact that so much of our data is kept in 
data bases on networks, and they may be vulnerable for attacks 
overseas, you do not have to be in the United States to 
undertake an attack and to secure secrets from our networks. 
And so the counterintelligence threat has evolved in ways that 
were not present back during the Cold War.
    In terms of numbers of persons, I think that is less 
important than the ways that foreign countries are seeking to 
steal our secrets, not just within individuals, not just with 
``HUMINT,'' as one would call it in the intelligence community, 
but also with cyber attacks and cyber extractions of 
information.
    Senator Feinstein. One quick question. Sex trafficking of 
children.
    Mr. Mueller. Yes.
    Senator Feinstein. A big issue, large numbers, I think all 
of us one way or another have run into it in our States. What 
more can the FBI do to be helpful with this really terrible, 
terrible thing?
    Mr. Mueller. We have a program that we have had for a 
substantial period of time which we focus on this phenomenon 
throughout the United States, and we have, on a number of 
occasions, had substantial takedowns of individuals who are 
involved in it. Unfortunately, that does not end the problem. 
There are many more out there.
    The gratifying aspect of it from persons who work there say 
it is that the victims we are able to save in terms of our 
activity. It is another area where we would love to be able to 
put more additional resources. We try to leverage what 
resources we have because every child saved is a child that we 
will remember for a good long time.
    Senator Feinstein. Thank you.
    Chairman Leahy. Thank you.
    Senator Kyl.
    Senator Kyl. Thank you, Mr. Chairman.
    Just following up on that last point, you talked before 
about the need to prioritize in the event of sequestration. 
Every one of these responsibilities that the Federal Bureau of 
Investigation has are important to somebody, and in many cases, 
they are important to the entire citizenry.
    When you said, ``Our budget would take a big hit''--let me 
see if I can get the--``It would be a very hard hit'' is what 
you just said. I recall when the Secretary of Defense was asked 
not just about the hit on the budget but the effect on the 
country on his ability to help defend the country. Could I ask 
you to respond to the question in that way about the FBI's 
ability to do the important work that it has? The Secretary of 
Defense called it ``catastrophic.'' How would you characterize 
the effect of these sequestration across-the-board cuts if, in 
fact, they occur?
    Mr. Mueller. Let me go back and say I misspoke before, 
because I think I said it would be a seven- to eight-percent 
cut. I should have said we would lose 3,500 positions as 
opposed to 1,500. It is 3,500 positions: 1,500 special agents, 
1,100 analysts, and 900 professional staff.
    It is hard for me to categorize and use a word such as 
``catastrophic.'' I would say it would be, maybe as important a 
word, ``devastating'' for a variety of reasons.
    Senator Kyl. That is bad enough.
    Mr. Mueller. The individuals--and devastating from, as you 
point out, the impact it will have not just on the Bureau but 
on people that we serve. The programs that we have to save 
children, the programs we have to protect our networks from 
cyber attacks, the programs we have to put behind bars those 
persons who are responsible for white-collar crimes, securities 
fraud, corporate fraud, and mortgage fraud, health care fraud--
all of which if you do not have the capacity to go and put the 
persons in jail, then there is no deterrence and it will grow. 
It will hamper that.
    And more particularly, what people tend to forget is the 
long-term effects when you have a hiring freeze or you have a 
sequestration where the institution is impacted for years down 
the road. It may be rectified in 12 months or 18 months or two 
years. But that hiring freeze and the like translates into a 
gap in that agency for years down the road.
    Where we are attempting to keep up with the technology when 
it comes to responding to cyber attacks, we will miss a 
generation of individuals who have those capabilities if we are 
required to cut back and lose 1,500 agents. So not only is the 
impact devastating at the outset, it is devastating down the 
road.
    Senator Kyl. Thank you for that, and I share my colleagues' 
concern that we must address this, and certainly before the end 
of the year.
    Let me also refer to your testimony about investigating the 
source of the leaks of this most recent--I think you referred 
to it as an IED, but we can refer to it as another potential 
underwear bomber case. Would that be accurate?
    Mr. Mueller. Yes. Explosive device.
    Senator Kyl. Explosive device. And you do have an 
investigation ongoing, underway. Is that correct?
    Mr. Mueller. Yes.
    Senator Kyl. And let me just ask you about--how would you 
characterize how important it is to find the source of the 
leak?
    Mr. Mueller. As I indicated before, leaks such as this have 
a devastating--I do not want to overuse the word 
``devastating''--but have a huge impact on our ability to do 
our business, not just on a particular source and the threat to 
the particular source, but your ability to recruit sources is 
severely hampered. And in cases such as this, the relationship 
with your counterparts overseas is damaged, which means an 
inhibition in the willingness of others to share information 
with us where they do not think that information will remain 
secure.
    So it also has some long-term effects, which is why it is 
so important to make certain that the persons who are 
responsible for the leak are brought to justice.
    Senator Kyl. Now, sometimes there is no other lead that 
leads you to the result except talking to the reporters 
involved. In the past, you and others in the law enforcement 
community have taken a very strong position indicating your 
concerns about legislation that would undermine your ability to 
protect intelligence sources and methods that could seriously 
impede national security investigations.
    Is it still your view that it would not be a good policy 
for reporters to have a special privilege or a special right 
not to talk to FBI or other law enforcement officials if they 
may have the information that would lead you to the leaker?
    Mr. Mueller. That is somewhat general in terms of sort of 
framing legislation. I would have to leave the ultimate 
decision on the legislation to the Department of Justice. But I 
do believe that the protocols established within the Department 
of Justice to protect and assure the media are adequate to 
accomplish that task.
    Senator Kyl. I appreciate that, and the reason I ask the 
question generally is because I realize that policy is set by 
the Attorney General or the administration generally, which is 
why I asked you about as a general proposition whether it is 
helpful or harmful to your efforts. And you have said in the 
past that your FBI guidelines are sufficient. Others have 
agreed with that. I happen to agree with that and think that 
that is good policy.
    Let me just conclude by reiterating the comments of both 
Senators Kohl and Feinstein about the importance of 
reauthorizing FISA before the end of the year. There is a lot 
of concern around here that we are going to kick all of the 
big, important decisions down the road to after the election, 
and even though this does not expire until the end of the year, 
I think my colleagues were saying it would be good to do this 
as soon as possible.
    Just from the standpoint of knowing what you have to deal 
with in the future, the continuity of your training and law 
enforcement efforts and so on, is it your view that the sooner 
we could accomplish this reauthorization of Title VII of FISA, 
the better from your perspective?
    Mr. Mueller. Yes. Give us some certainty.
    Senator Kyl. Thank you very much, Mr. Director.
    Senator Feinstein. [Presiding.] Thank you very much, 
Senator Kyl.
    Senator Durbin.
    Senator Durbin. Thank you, Senator Feinstein.
    Director Mueller, good to see you.
    Mr. Mueller. Senator.
    Senator Durbin. And thank you for your service. You have 
done an extraordinary job in one of the most challenging times 
in our Nation's history. I thank you personally for taking some 
time to focus attention on my home town of East St. Louis, 
Illinois, which, sadly, has one of the highest rates of violent 
crime per capita in the Nation. There is a WAVE Task Force, a 
multi-unit task force, including FBI agents, which is doing its 
level best to change that, and I thank you for your 
willingness, even with limited resources, to participate.
    We have exchanged conversations and correspondence on the 
issue of training manuals, and I would like to make the record 
clear today about the current situation. I am asking to enter 
into the record letters which you and I exchanged in March and 
April of this year when it was disclosed, when some parts of 
the training manuals became public, that some things had been 
stated in the training of FBI agents which had been, I would 
just say, characterized as inappropriate and unfair to Arabs 
and Muslims. And we have spoken about this personally. I have 
spoken to Attorney General Holder. Could you tell me at moment 
in time what is the current status of training manuals in the 
FBI as it relates to these two groups and what you have done to 
make certain we do not have the kinds of things that have 
troubled us in the past?
    Mr. Mueller. Yes, Senator, as I have indicated in the 
letter, when this came to our attention last summer, we took it 
exceptionally seriously, and we convened a group of five 
individuals, we believe, all of whom have advanced degrees, two 
of whom were in the Bureau, three were outside the Bureau, to 
make a preliminary review of the materials and determine what 
then should be done to make certain that the training we give 
our agents is appropriate.
    With a touchstone document--and I have to apologize because 
I believe in a conversation with you I indicated that it was a 
curriculum. It was not. It was a touchstone document that these 
persons put together as a guidance as to how to go through and 
treat the records we were going through.
    We then had up to 30 individuals--agents, analysts, and 
others--go through over 160,000 documents, training documents--
not necessarily a manual but training documents that had been 
used over the preceding 10 years since September 11th, along 
with more than 1,000 slides and the like. We had them go 
through and pull out those particular documents that were 
inappropriate for whatever reason. They could have been wrong; 
they could have raised the specter of an individual being 
pointed out that should not be pointed out. For whatever 
reason, those particular documents needed to come out of our 
training. We identified 876 of those documents that needed to 
be pulled out. We found the other approximately 160,000 
documents appropriate.
    Then, with those documents, we went out to the field and 
explained why these particular documents, with examples, were 
inappropriate. We interviewed the individuals who were 
responsible for those documents. We did more than 100 
interviews of such individuals. And we also are in the process 
now of going out and making certain that the materials that we 
are using are in accordance with our--are appropriate.
    One of the things it did teach us and one of the things 
that comes out is that we did not have a mandatory review for 
training documents such as this, and so we have put into place, 
apart from this, a review of training so that anybody who is 
giving a training cannot just go up and put together their 
training materials. It has to go through a screening process.
    We have taken it exceptionally seriously, as I think 
perhaps you can understand given the personnel we put on it. 
But I think we have gone a long way to resolving the issue.
    Senator Durbin. Critics have said this is all about 
congressional meddling and political correctness, and I would 
like to have your characterization, because you stated to us 
earlier that one of the key elements in fighting terrorism is 
connections, cooperation, and you have said, Attorney General 
Holder has said that Muslim Americans and Arab Americans have 
been a vital part of our effort to keep our Nation safe. I 
would like to have your characterization as to whether this is 
just an exercise of political correctness.
    Mr. Mueller. Well, for us and for me personally, it is not 
an exercise of political correctness. It is an exercise of 
doing what is right given what we had seen. I believe that the 
five individuals that we selected have the professional 
capabilities to guide us in this way, and it is absolutely 
essential that our agents are instructed giving the best 
possible materials and those materials that are in accordance 
with our core values. So I reject any assertion that this is as 
a result of political correctness or any such other 
characterization. It is what needed to be done. And I will 
follow up, as I have before, and said that many of the cases 
that we have done are a result of the Muslim community bringing 
to our attention individuals who needed further investigation, 
and we would not be as safe as we are today without the support 
of the Muslim American, Arab American, and Sikh American 
communities in the United States.
    Senator Durbin. Thank you. I only have a brief time left 
here, and I am sorry because we went through this exercise--and 
it was unusual--where all Members of the Senate, Democrats and 
Republicans, were invited to a classified hearing--the FBI was 
represented, the Department of Defense, so many other 
agencies--on cybersecurity, which you mentioned. There is a 
bill pending to try to make our Nation safer from the 
cybersecurity threat. I am trying to look at this through the 
prism of our individual rights of privacy as individuals and 
the basic liberties and values that we share.
    Can you tell me, in the brief time remaining here, do you 
feel that the cybersecurity legislation proposed by the 
administration compromises any of the rights of privacy that 
individuals have customarily enjoyed in this country under 
wiretap statutes and other--I could go through the specifics 
here--other legislation? Are we changing the standard when it 
comes to cybersecurity in terms of the disclosures of any 
individuals' emails or texts in the name of security?
    Mr. Mueller. It does not change the standards by which the 
government can obtain information relating to an investigation. 
Let me just put it that way. And while I am somewhat familiar 
with the administration's proposal, I am not thoroughly 
familiar, so I do not think from what little I know that it 
changes that dynamic at all.
    I will say, though, the only way to prevent a cyber attack, 
a substantial cyber attack, is to exchange information. In the 
same way, to prevent terrorist attacks you need to exchange 
information. And the success, any successes after September 
11th are due to the fact that we are working closely with State 
and local law enforcement, working with the intelligence 
community. We understand that the borders no longer protect us, 
and we have to share information. To protect against cyber 
attacks, we are going to have to do the same thing, but it is 
going to have to incorporate the private sector in ways that 
you did not have to incorporate the private sector when we were 
facing the counterterrorism threat.
    But the cyber threat will be no less than the 
counterterrorism threat. There will have to be the exchange of 
information, and it needs to have an exchange not just between 
the intelligence community and the law enforcement community, 
but between the intelligence community, the law enforcement 
community, DHS, and the private sector.
    Senator Durbin. There will be many more questions. I thank 
you.
    Chairman Leahy. Thank you.
    Senator Lee.
    Senator Lee. Thank you, Mr. Chairman.
    Thanks for joining us today, Director Mueller, and I want 
to thank you not only for being here but also for serving our 
country. Yours is not an easy job.
    Last year, you expressed some concerns about the National 
Defense Authorization Act for 2012. Specifically, in a letter 
that you wrote to Senator Levin in November of last year, you 
expressed some concerns with what became Section 1022 of that 
legislation, saying that you were worried about that provision 
introducing a degree of uncertainty and potentially inhibiting 
the FBI's capacity to convince covered arrestees to cooperate 
immediately and to provide important intelligence.
    My concerns with the NDAA focused much more with what 
became Section 1021. To some extent, I think the President 
indicated that he shared some of those concerns. He indicated 
in his signing statement on December 31, 2011, as follows. He 
said, ``I want to clarify that my administration will not 
authorize the indefinite military detention without trial of 
American citizens. Indeed, I believe that doing so would break 
with our most important traditions and values as a Nation. My 
administration will interpret Section 1021 in a manner that 
ensures that any detention it authorizes complies with the 
constitutional laws of war and other applicable law.''
    In light of that statement--you know, I was encouraged by 
that statement. I think it is good. I still had some concerns 
that future administrations might not hold that view or that 
this administration might change its position at some point. In 
light of that concern, I joined with Senator Feinstein in 
introducing S. 2003, the Due Process Guarantee Act, to ensure 
that U.S. citizens apprehended on American soil are not 
detained indefinitely without charge or without trial.
    So I guess my first question is: Do you share the 
President's commitment, as I assume you would, as to the fact 
that U.S. citizens should not be detained indefinitely without 
trial under 1021?
    Mr. Mueller. Well, yes, in the sense that--yes. Yes. But 
let me just say there is no change to our activities; in other 
words, our authorities remain the same. How we handle things is 
not changed by the President's declaration. But, yes, I would 
assume that that would happen, that would be the case.
    Senator Lee. Some people have suggested that military 
detention may be necessary in some of these circumstances 
because FBI and other civilian authorities lack the resources 
or the capabilities to deal with the unique circumstances 
associated with the apprehension and detention of terrorism 
suspects. And so my question for you on that point is: What are 
the FBI's abilities in this regard? Do you feel the FBI would 
lack the capacity to handle these circumstances to deal with 
the apprehension and detention of terrorism suspects?
    Mr. Mueller. No. The answer at the outset is no, but we may 
be talking about a different class of--if you are talking about 
covered 1022 persons, we are talking about individuals who are 
non-U.S. citizens, individuals who are participating in a plot 
with Al Qaeda and the like, where 1022 kicks in.
    Going back to your initial question, I had some concerns 
about clarity as to what would happen at the time of arrest. 
Those concerns have been put to rest by the protocol that was 
established by the President.
    Regardless of whether a person is detained in the United 
States by the FBI or ultimately it could be by the military, if 
it happens on a base, for instance, I have no question but that 
ourselves and the military would be capable of handling the 
consequent investigation and search for intelligence.
    Senator Lee. Okay. So given this protocol that was 
developed in light of the President's signing statement on 
December 31st, given what you just added to that, would it be 
fair for me to assume that the administration would not object 
to legislation that would put this rule in place by statutes, 
in other words, to say that we would not use Section 1021 to 
indefinitely detain U.S. citizens?
    Mr. Mueller. That would have to go to the Department of 
Justice. That is a step too far for me.
    Senator Lee. Understood. Understood.
    In your testimony, in your written testimony, you stated 
that you support the reauthorization of the FISA Amendments 
Act. Among other things, those amendments authorize the 
government to surveil various categories of non-U.S. persons 
abroad, outside the United States, without the need for a court 
order for each individual target.
    Although these amendments do not appear to allow the 
government intentionally to target a U.S. person or 
intentionally to target any person on U.S. soil, it does seem 
that the amendments have the potential to result in warrantless 
surveillance of communications that involve U.S. citizens.
    Can you explain, in light of this potential, what steps can 
be taken, what steps might be taken in order to protect U.S. 
citizens?
    Mr. Mueller. Let me just say we are concerned about both 
the thrust of the statute as well as the provisions of the 
statute that minimize the possibility of this happening. But 
beyond that, I would have to do it in closed session.
    Senator Lee. Okay. But you do share the concern that there 
is that potential and you share a commitment to taking steps to 
protect U.S. citizens?
    Mr. Mueller. Yes, and my understanding is as the statute 
was winding its way through Congress, those concerns were 
raised and addressed in the statute. And, yes, we fully comply 
and understand the thrust as well as the letter of the statute.
    Senator Lee. Okay. I see my time has expired. Thank you, 
Mr. Chairman. Thank you, Director.
    Mr. Mueller. Thank you.
    Chairman Leahy. Thank you, Senator Lee.
    Senator Blumenthal.
    Senator Blumenthal. Good morning, and I want to join other 
Members of the Committee in thanking you for your extraordinary 
service over many years, many challenging and difficult years, 
on many challenges and difficult topics. Obviously, 
particularly in the area of terrorism, the FBI has taken an 
increasingly important role not just in terms of apprehending 
and prosecuting terrorism here in this country, but also 
abroad. And in the area of white-collar crime, you have 
continued to be an extraordinarily important presence.
    I would like to ask first about the JPMorgan Chase 
investigation. Can you tell us what potential crimes could be 
under investigation without asking you to conclude anything or 
talk about the evidence? Would it be false statements to the 
Federal Government or what area of criminal activity?
    Mr. Mueller. I am hesitant to say anything other than what 
is available under Title 18 or available to the SEC would be 
the focus of any ongoing investigation.
    Senator Blumenthal. And can you talk at all about the 
timing of that investigation?
    Mr. Mueller. All I can say is we have opened a preliminary 
investigation, and as you would well know, having been in this 
business for a long time, it depends on a number of factors.
    Senator Blumenthal. And I am not going to press you 
further, but I would just encourage you, without your needing 
any encouragement, I am sure, to press forward as promptly and 
expeditiously and aggressively as possible, because I think 
that the American public really has lost faith in many other 
enforcement agencies, partly because of the delay and lack of 
results, and I think that the FBI's involvement is a very 
constructive and important presence in this area.
    Mr. Mueller. Thank you.
    Senator Blumenthal. Turning to the Violence Against Women 
Act, where, again, the FBI has really been a leading role in 
stopping assaults and intimidation and harassment of women. As 
you know, the Senate has reauthorized VAWA--it is now under 
consideration in the House--with provisions on cyber stalking 
that seem less forceful and robust than the ones that we 
adopted and I have urged and drafted to adopt in this body.
    I wonder if you could talk to us about how important cyber 
is in the area of domestic violence and violence against women 
generally.
    Mr. Mueller. Well, I must say I am not familiar with the 
differences between the two proposed statutes. I will say, on 
the other hand, that cyber stalking is--it can be difficult to 
define, but once defined, the impact is substantial on the 
individuals, and it is a growing phenomenon that does need to 
be addressed.
    Senator Blumenthal. And would you say that crimes resulting 
in domestic violence or violence against women do often involve 
the Internet and the use of impersonation and similar kinds of 
tactics?
    Mr. Mueller. Increasingly, and increasingly, once you have 
one individual who is prosecuted for this and it becomes 
public, you find a number of others that would undertake the 
same activity, unfortunately.
    Senator Blumenthal. Thank you.
    Turning to another subject, drug shortages. I do not know 
whether you are familiar with some of the gray market 
activities, some of the potential price gouging that goes on 
with respect to pharmaceutical drugs that are in shortages--
cancer treatment, anesthesiology drugs. The FDA was ordered by 
the President to refer to the Department of Justice any 
evidence of drug shortages that could involve either civil or 
criminal violations of law. I wonder if you are familiar with 
any cases that have been referred.
    Mr. Mueller. I am not, but we may well have cases that I am 
not familiar with or aware of relating to this particular area.
    Senator Blumenthal. If you could get back to me on that 
subject and if you feel you are at liberty to do so, that would 
be helpful.
    Mr. Mueller. I am happy to do that.
    Senator Blumenthal. On the ongoing investigation--I take it 
it is ongoing--with respect to East Haven in the State of 
Connecticut, is there any update that you can provide? And I 
just want to say before you answer that both the FBI and the 
United States Attorney's Office and, in particular, the United 
States Attorney in Connecticut overall, as well as on this 
case, are doing extraordinarily excellent work, and I am very 
proud of the great job that they are doing there, and I say 
that as one who would be critical--having been a United States 
Attorney, I am not one who would be less than demanding of that 
office, but they are doing--both the FBI and the U.S. Attorney 
there are doing great work.
    Mr. Mueller. I am familiar with the investigation but 
cannot in open session discuss it.
    Senator Blumenthal. On gasoline prices, do you know of any 
uptick in criminal activity there with respect to price gouging 
or----
    Mr. Mueller. Have not. Again, that is something we will 
have to get back to you on. We may have seen something. I would 
have to go back and find out where we are on that.
    Senator Blumenthal. Thank you. Again, thank you for your 
great work. My time has expired, and I appreciate your being 
here.
    Mr. Mueller. Thank you.
    Chairman Leahy. Thank you very much.
    I yield now to Senator Graham, and I was going to ask 
Senator Blumenthal if he is willing to take the Chair, as I 
will not be coming back. I am going on to something else. 
Again, as I told you earlier, both publicly and privately, 
Director Mueller, I appreciate your cooperation. And some of 
the things, as you have said, will have to be in closed 
session. We can follow up with you privately.
    Mr. Mueller. Thank you.
    Chairman Leahy. Thank you. Senator Graham.
    Senator Graham. Thank you, Mr. Chairman.
    Thank you again for your service, Director. I am going to 
send you a series of questions to kind of explore further what 
Senator Lee was talking about so we will not have to use the 
whole seven minutes here talking about the details of Miranda 
and what an enemy combatant is or is not. But we are going to 
talk about big themes.
    On cybersecurity, do you have all the resources you need 
right now to defend the Nation against a cyber attack within 
reason?
    Mr. Mueller. We need additional resources. We are 
reprioritizing. We are reorganizing to address cyber. We have 
a----
    Senator Graham. What is the risk to the Nation of a cyber 
attack in the next decade?
    Mr. Mueller. Substantial.
    Senator Graham. So would you do me a favor and just quietly 
and appropriately write down that list of needs and get them to 
me, and I will spread them to my colleagues.
    Mr. Mueller. Have done it. Will do it.
    Senator Graham. And I just really appreciate the FBI in 
many ways.
    Senator Graham. Okay. Do you believe that we are in a war 
against terrorism? Is the war on terror an appropriate name to 
define the time in which we live?
    Mr. Mueller. Yes.
    Senator Graham. Okay. I do, too. It is not the crime on 
terror. It is the war on terror.
    I believe that Article III courts have a place in 
prosecuting terrorists. Do you agree with that?
    Mr. Mueller. Yes.
    Senator Graham. Do you believe that military commissions 
could also have a place in prosecuting terrorists?
    Mr. Mueller. Yes.
    Senator Graham. U.S. citizens are not eligible for military 
commission. Do you agree with that?
    Mr. Mueller. Yes.
    Senator Graham. Just say yes because--okay.
    [Laughter.]
    Senator Graham. I am not trying to trick you.
    Mr. Mueller. I am waiting.
    Senator Graham. I know, I know.
    Is the homegrown terrorist threat growing or lessening?
    Mr. Mueller. Growing.
    Senator Graham. Do you consider America part of the 
terrorist battlefield, the country itself? Isn't that sort of 
what they want to do, is hit us here as much as anywhere else?
    Mr. Mueller. You know, one could get into parsing the terms 
of the description. I would say that we have a terrorist threat 
domestically, and we have terrorist threat internationally.
    Senator Graham. Right. Well, let us talk about the fact 
that I think they want to kill us everywhere, but particularly 
here, and I do not think it was an accident that they brought 
down the Twin Tower, attacked the Pentagon, and tried to attack 
the Capitol. They are coming after us. Do you agree with that?
    Mr. Mueller. Yes.
    Senator Graham. All over the world.
    Mr. Mueller. Yes.
    Senator Graham. And we have a right to defend ourselves.
    Mr. Mueller. Yes.
    Senator Graham. Within our values. You do not support 
waterboarding, right?
    Mr. Mueller. No.
    Senator Graham. Nor do I.
    Mr. Mueller. It does not comport with our guidelines.
    Senator Graham. I agree, and I appreciate you at a time 
when it was not popular saying so, quite frankly.
    Do you believe Khalid Sheikh Mohammed is an enemy 
combatant?
    Mr. Mueller. I am not going to--I will go down the road 
just so far, but in terms of the designation, I think there are 
a number of factors that go into that, so I am not going to say 
a yea or a nay.
    Senator Graham. Well, do you believe that Al Qaeda members 
can be classified as enemy combatants since we have about 200 
and some at Guantanamo Bay?
    Mr. Mueller. I believe so, but, again, this is dependent--
--
    Senator Graham. We are not holding people illegally there, 
are we?
    Mr. Mueller. No.
    Senator Graham. Okay. Now, if you caught Osama bin Laden or 
KSM or somebody like that tomorrow in the United States, would 
you suggest that the country take off the table military 
commission trials simply because the foreign terrorist was 
captured in the United States?
    Mr. Mueller. I would stay away from suggesting--that would 
be a decision for the President. My responsibility, our 
responsibility, would be to gather whatever facts, 
intelligence, and/or----
    Senator Graham. Right. Well, I am glad to hear you say 
that, because I do not believe it is the policy of Obama 
administration that foreign terrorists captured in the United 
States cannot be tried by military commissions and cannot be 
held as enemy combatants. And to Senator Lee's line of inquiry, 
I do not believe we want to send a signal to the world that if 
you make it to America, all of a sudden you get a better deal 
than if we catch you in Pakistan.
    But let us talk about your job. When we capture someone 
that we believe to be affiliated with Al Qaeda in the United 
States, is it the Obama administration's position, the FBI's 
position, that those individuals captured collaborating with Al 
Qaeda in the United States must be Mirandized?
    Mr. Mueller. There is no blanket rule on Mirandizing 
individuals of Al Qaeda in the United States.
    Senator Graham. Well, okay. This is a very important. I 
think that is a good answer. Sometimes maybe it is the best 
thing to do; sometimes maybe it is not.
    Mr. Mueller. Well, I think the policy that has been laid 
out is that intelligence comes first.
    Senator Graham. Okay.
    Mr. Mueller. And the Quarles exception to the Miranda rule, 
we have leeway to undertake----
    Senator Graham. Okay. Right. How long under Quarles--which 
had to do with a domestic crime, not a terrorism case. How long 
can you hold someone under the Quarles case before you have to 
read them their Miranda rights?
    Mr. Mueller. I think that is still an open question.
    Senator Graham. Is it two days? Is it two weeks?
    Mr. Mueller. It is an open question depending on the 
circumstances.
    Senator Graham. Well, I would suggest that the people we 
have held at Guantanamo Bay for years as enemy combatants could 
only be held that long because we have designated them as enemy 
combatants. I do not want to bastardize the criminal justice 
system. Once we use it, I want it to work the way it should. 
And I believe that if you capture someone in the United States 
and you are going to charge them with a crime in an Article III 
court and that is your intent, your ability to hold them 
without Mirandizing them under Quarles is limited. But how long 
can you hold someone that you want to put in the criminal 
justice system without presenting them to a federal court under 
the presentment requirements?
    Mr. Mueller. You are required to present them generally 
within the next 24 or 48 hours.
    Senator Graham. Okay. So you have got to present them to 
court----
    Mr. Mueller. I presume you are talking about non-U.S. 
citizens.
    Senator Graham. Yes.
    Mr. Mueller. Okay.
    Senator Graham. So as I understand, then they get a lawyer 
at presentment, don't they? They have to have somebody helping 
them----
    Mr. Mueller. It depends on the circumstance. Some have, 
some have not.
    Senator Graham. Okay. But my point is that you are taking a 
suspect who we believe is involved in terrorism, when you put 
them in the criminal justice system, you have Miranda issues 
and presentment issues. If you keep them in the law of war 
system, holding them as an enemy combatant for intelligence-
gathering purposes, you do not have these problems. Is that 
correct?
    Mr. Mueller. I am not certain to what extent you can make 
that blanket statement.
    Senator Graham. Okay.
    Mr. Mueller. And, also, I think there are downsides from 
doing it that are often overlooked.
    Senator Graham. Do you know any requirement in the law of 
war to read an enemy prisoner their Miranda rights or provide 
them a lawyer when they are held in military custody?
    Mr. Mueller. I am not familiar--I am not as familiar with 
the military code as you are.
    Senator Graham. Well, I would just suggest--and I do not 
want to belabor this, but we have never in a war captured an 
enemy prisoner and said, ``Hey, you got a right to a lawyer, 
here is your lawyer. We hold you to gather intelligence because 
we are trying to prevent the next attack, not prosecute you.''
    So I am going to send you a series of questions, and I want 
us to understand as a Nation that we are at war. I want to 
treat people fairly. I believe in all of the above. But I am 
not going to sit on the sidelines and go back to a pre-9/11 
model of where the criminal justice system is the only tool 
available to fight this war.
    So, Mr. Director, you have got really dedicated agents who 
are putting themselves at risk, and when we capture one of 
these people who we believe is involved with Al Qaeda in a way 
to hurt us all, I think we should have as many options as 
possible within our values and within the law of war and the 
criminal justice system to defend ourselves. So I am going to 
send you some questions, and I am glad to hear that there is no 
blanket requirement by the FBI to Mirandize a terrorist suspect 
upon capture in the United States. So that is good to know.
    [The questions of Senator Graham appear under questions and 
answers.]
    Senator Graham. Thank you.
    Senator Blumenthal [presiding]. Senator Schumer.
    Senator Schumer. Thank you, and thank you, Director, for 
the outstanding job you and the men and women who work for you 
do. I admire it every day.
    Now, I would like to talk a little bit about relations 
between the FBI and the NYPD. Overall, it has been a great 
relationship; it has been a smooth relationship. It has been, I 
think, pointed to as an outstanding example, the Joint 
Terrorism Task Force, of cooperation between the Federal 
Government and State government and local government. But over 
the last few months, there have been a number of things that 
create a growing concern that that relationship may be fraying 
a little bit, particularly in regard to information sharing, 
which I know, obviously, you have got to be very careful with, 
but these are two law enforcement agencies involved together in 
fighting terrorism.
    There have been cases where the NYPD believes it has not 
been briefed on the specifics of terrorist plots, which is the 
type of information they need because of New York City being a 
top terror target. The Joint Terrorism Task Force should know 
information regarding terror plots related to New York City at 
the same time the FBI knows of this information or to give our 
forces the best chance to combat terrorism. And if it cannot be 
known immediately, it should be shortly thereafter.
    We have some examples where for four or five days after it 
was even made public, they did not get the kind of detailed 
information that they wanted.
    So my question is: Do you believe there is currently a 
problem hindering communication within members of the Joint 
Terrorism Task Force? If there is a problem, what can be done 
about it to better facilitate communication between the two? I 
have great respect for both and have been proud of the 
cooperation. If there is no problem, will you commit today to 
keeping NYPD abreast of any and all future developments related 
to terrorist plots? And will you work with the NYPD to address 
the cooperation and information-sharing issues so that 
everybody is on the same page and can work together as well as 
they have in the past?
    Mr. Mueller. Well, let me just start by saying that I think 
we have a very good relationship with the New York Police 
Department, particularly on the Joint Terrorism Task Force. We 
have tens of NYPD officers who have served on it. Many of them 
served for any number of years.
    To the extent that the New York field office gets terrorism 
information, it goes to the Joint Terrorism Task Force.
    Senator Schumer. Right.
    Mr. Mueller. It is there. The officers from the NYPD get 
the information at the same time as the agents on the task 
force get the information.
    There are occasions where there is something very tightly 
and closely held in agencies, and it may be in Washington, that 
it takes some time before there is further dissemination, which 
makes sense. There are always bumps in the road. The----
    Senator Schumer. Have they increased over the last months?
    Mr. Mueller. No, I would say----
    Senator Schumer. It seems to me they have.
    Mr. Mueller. No, no. There are always bumps in the road, 
and every six months or so, Ray Kelly and I get together and 
discuss those bumps in the road and move on. So I think the 
relationship is very good and, let me just say, tremendously 
effective. I think the Joint Terrorism Task Force is effective. 
I think NYPD is effective at preventing attacks. And whenever 
you have strong-willed agencies and parts of agencies, you are 
going to have, as I say, the bumps in the road. I do not think 
there is any extraordinary action that needs to be taken by 
myself or Ray Kelly or others to address a current issue.
    Senator Schumer. Okay. And that would apply in reference 
to--I understand the difficulties, as I read in the newspaper. 
I did not know anything else. The information about the recent 
airplane bomber leaked out prematurely. You do not have to 
comment on that, but are there any problems with communication 
on that issue now between the----
    Mr. Mueller. There should not be.
    Senator Schumer. There should not be, okay, because there 
was some talk that there was.
    Mr. Mueller. I heard that talk.
    Senator Schumer. Okay. And have you talked directly to 
Commissioner Kelly about this?
    Mr. Mueller. I have not on this issue. I met with him about 
a month ago.
    Senator Schumer. Would you be willing to?
    Mr. Mueller. Sure.
    Senator Schumer. Great. Just a suggestion for the continued 
cooperation, give him a call on this, okay? He did not ask me 
to ask you to do that. I am. Okay?
    Mr. Mueller. Yes.
    Senator Schumer. Thanks. And then one----
    Mr. Mueller. As I told Ray, he is always, you know----
    Senator Schumer. I know. Let us not get into who calls 
whom. I am asking you to call him.
    Mr. Mueller. I am happy to do it.
    Senator Schumer. Thanks. Appreciate it very much.
    There was one other instance. This was not related to the 
Joint Terrorism Task Force, but you and I talked a little about 
this, and I did not follow up. When the FBI Bureau Chief in 
Newark publicly criticized the NYPD for conducting operations 
that he said made it more difficult to protect the public in 
New Jersey--again, I do not have a problem if the FBI thinks 
the NYPD is doing something that interferes with this operation 
in New Jersey. I was sort of surprised that he made it public. 
Now, what was that all about? That does not help.
    Mr. Mueller. I understand, and I have addressed the issue.
    Senator Schumer. You have addressed the issue?
    Mr. Mueller. I have addressed the issue.
    Senator Schumer. Okay. And everyone is happy now?
    Mr. Mueller. Not everyone.
    [Laughter.]
    Senator Schumer. Should I ask----
    Mr. Mueller. I have addressed the issue.
    Senator Schumer. Okay. I hear you. Let us go on to another 
subject. Thank you. I am glad you have addressed it, and I hope 
that does not create any future problems, because it did create 
bad blood for a period of time.
    Mr. Mueller. I understand.
    Senator Schumer. Okay. Stand your ground laws, there has 
been a lot of news this week about the FBI investigating hate 
crime charges in the Trayvon Martin case. I do not want you to 
comment on the investigation, but I just want to get your 
opinion about the stand your ground laws. Are they creating 
more violence than they are preventing?
    Mr. Mueller. I really cannot--there is that one incident we 
have. There may be others around the country. I cannot give you 
an opinion on that.
    Senator Schumer. Okay. How about your general opinion on 
these stand your ground laws?
    Mr. Mueller. I do not know enough about them to render an 
opinion.
    Senator Schumer. Okay. I would ask you, if you--again, I do 
not want to put you in any jeopardy in terms of this 
investigation, but if you wanted to think about it and had 
something in writing you wanted to send within the timeframe 
that the Chair has laid out, I would appreciate it.
    Mr. Mueller. Yes, sir.
    Senator Schumer. I tend to think these are 
counterproductive and hurt law enforcement.
    Okay. I have only 33 seconds left, so I will just submit my 
final question in writing.
    Mr. Mueller. Thank you.
    [The question of Senator Schumer appears under questions 
and answers.]
    Senator Blumenthal. Thank you, Senator Schumer.
    Senator Whitehouse, I----
    Senator Whitehouse. Let Senator Klobuchar----
    Senator Blumenthal. I am sorry. Senator Klobuchar is next. 
I am going to yield the gavel to Senator Whitehouse.
    Senator Whitehouse. I will be right back.
    Senator Blumenthal. As soon as he returns, and now Senator 
Klobuchar.
    Senator Klobuchar. [Presiding.] Thank you very much. I am 
the one standing with the gavel, I guess.
    Senator Blumenthal. You now have the gavel.
    Senator Klobuchar. Thank you, Director, for being here. I 
appreciate how often you come and how we are really kept 
abreast of everything that you are doing. Many of my colleagues 
have asked about officer safety issues with the national 
memorial services this week. I was just with the families and 
police officers over the last two days, two officers that died 
in the line of duty in Minnesota; one, in fact, reported to a 
scene of a domestic violence case, a 17-year-old victim, he 
basically sacrificed his life for hers, and he leaves three 
young children.
    One of the things that came up at a previous hearing we had 
here on the bulletproof vest, which is incredibly important, is 
that 72 of our Nation's law enforcement officers were killed in 
the line of duty during 2011, and that is the highest number 
since 2007. It is up 20 percent from 2010. By region, 29 were 
killed in the South, 21 in the Midwest, 10 in the West, 10 in 
the Northeast, and two in Puerto Rico.
    Are you aware of any factors that would explain this 
increase? Or do you think it is just random tragic statistics? 
Or do you know how this has happened?
    Mr. Mueller. No, I do not think anybody has a clear answer, 
although we tried to dissect those figures. I will tell you, as 
I indicated before, there are two things we are doing trying to 
reduce it.
    The first is we have changed our pistol qualifications, 
understanding based on our data that many of the encounters 
that police have with persons with weapons are at a very short 
distance, not at a longer distance. And, consequently, we have 
to increase our capability of responding in shorter distances. 
And often when we change our protocols, State and local will 
follow as well.
    Then, second, when an individual is stopped, and they go 
into NCIC to find out the record, we will put a warning in the 
record if the person has--a warning with a response if the 
person has a violent criminal history, to alert that officer to 
beware.
    Senator Klobuchar. Very good. Thank you. And I know we have 
discussed the bulletproof vest issue, how important that is, 
and I had not known until we had a hearing with some of our 
police leaders about the issue with women with bulletproof 
vests and how they need different bulletproof vests, which 
makes sense, and how sometimes they do not have those, as we 
are seeing more and more women police officers. But I wanted to 
note that to you.
    Mr. Mueller. Yes.
    Senator Klobuchar. It is something that we need to address.
    I also know the FBI works closely with State and local 
authorities to keep our children safe through programs like the 
Child Abduction Rapid Deployment Teams and the Innocence Lost 
National Initiative. And next week, I am chairing a hearing on 
the issue of training child protection professionals. We have a 
good center in Minnesota, the National Child Protection 
Training Center in Winona, and one of the critical areas of 
training is forensic interviewing because many times a child 
victim may also be the only witness in these crimes. And 
according to one FBI child interviewers, methods used in adult 
cases may actually be counterproductive with child victims.
    I know the FBI has been doing some good work in this area, 
and as a result, the FBI child forensic interviewers' expertise 
is in demand across the country. Could you tell me how the 
training is available to FBI agents? And what else can we do to 
help the FBI make progress on the problems of child abduction 
and abuse?
    Mr. Mueller. We have four child forensic interviewers who 
are very qualified and do great work. They get too much of that 
work, unfortunately, and build up that expertise. We provide 
training to agents and task force officers around the country. 
Generally, the training lasts from three to four days, and the 
statistics for 2011 are that we trained 650 agents and task 
force officers in 2011 alone, and we will continue that.
    To the extent that there are law enforcement agencies that 
would benefit from that training, I am sure the special agents 
in charge in those particular divisions would try to 
accommodate.
    Senator Klobuchar. Well, thank you very much. I was just 
thinking back when I did a case as a prosecutor and it was a 
non-violent minor case, and there was a five-year-old witness. 
And without having any of your investigative skills, I put her 
on the stand and asked her what had happened, and I said, 
``Now, do you know what the truth is? '' She said, ``Yes, I 
do.'' And she said, ``But when I was four, I always told lies'' 
She was five years old, so I probably could have had an 
investigator, and needless to say, the case did not go very 
far.
    Metal theft, this is something that I have been frustrated 
with. We have been trying to get a bill done. We introduced one 
last year, Senator Hatch and I did, on trying to look at some 
of the criminal penalties and trying to get some requirements 
in place when scrap metal dealers get copper and other things, 
which we know sometimes can be stolen and sometimes now, with 
requirements for IDs and other things in place. And I just 
wondered if you are aware of that problem around the country 
with buildings blowing up and other things because of stolen 
copper.
    Mr. Mueller. Yes, and it is a problem. I will not mention 
the cities, but I know it is a problem in certain cities, and 
such a problem that emergency services can be adversely 
impacted by such thefts. And generally what we do is if there 
is a discrete group or entity that is involved in them, then we 
work with the State and locals to put together a task force to 
address it.
    But as we look at the budget shortages, as we look at 
prioritization in the context of perhaps the budgets will even 
get worse down the road, this is one where it is very difficult 
to find the resources to put on it.
    Senator Klobuchar. I understand that. That is why I figured 
one thing we could do that would be helpful is to put some 
requirements in place--some States have--on the sale of these 
things so it is easier for local law enforcement to track. So I 
wanted to put the words in because you have a lot on your 
plate, and I think the best thing would be to make it a little 
easier for locals to handle this.
    I had some questions, and I know Senator Kohl got into the 
economic espionage issue, which I think is critically 
important. We have many big companies in Minnesota that own 
many patents. My favorite statistic is that 3M has as many 
employees as they have inventions. There is one invention for 
each employee. And so we care very much about this espionage, 
especially over the Internet and some of the cyber crime that 
is going on. So I appreciate the work you are doing in this 
area and the way that you are adjusting to the ever changing 
technological climate with the FBI.
    Thank you very much.
    Mr. Mueller. Thank you.
    Senator Whitehouse. [Presiding.] Welcome, Director Mueller. 
Good to see you.
    Let me follow up on Senator Klobuchar's last point on our 
cyber vulnerability. Let me preface our remarks by saying that 
from my viewpoint on the Intelligence Committee, from my 
viewpoint on this Committee, from going out and seeing your 
folks in action at NCIJTF, from looking at some of the cases 
that have been put together, I am very impressed with the 
ability and the dedication of the forces that you have deployed 
against our cyber threat.
    What I am concerned about is not their ability. It is their 
adequacy. It is the quantity, not the quality. I think you run 
some very, very high-quality folks, and I appreciate that.
    I went out on a limb about two years ago and said that I 
thought that the theft of American intellectual property across 
our cyber networks was the biggest transfer of wealth in the 
history of the human species through theft and piracy and that 
we were on the losing end of it and we were not taking enough 
action to defend against it. And since then, General Alexander 
has said virtually the same thing. He is the head of Cyber 
Command and the head of NSA. And private sector observers like 
the latest McAfee report have again used almost the same 
language.
    So here we are, assuming that to be true, on the losing end 
of the biggest transfer of wealth in the history of humankind, 
and I want to ask your continued support for my office's 
efforts to try to get a real understanding of what our FBI and 
DOJ resources are dedicated to this problem.
    You have to really drill below the numbers, because I can 
ask DOJ and they can say, oh, well, there is a cyber person 
dedicated in every U.S. Attorney's Office, and I know perfectly 
well from having been a U.S. Attorney that that person may very 
well be doing no cyber cases at all. They may simply be the 
designee who puts the conference call on mute while they are 
doing other work.
    So just that number does not really help, and so we are 
trying to work through who is really on this cyber problem and 
how within the FBI. Are there people who are designated in your 
local offices who are in the same mode when there is a 
conference call to be had, they are the ones who take it but 
their workload is really elsewhere? Are there folks whose role 
is really sort of forensic clean-up, the people who, you know, 
when you raid a place, they grab the computers and they do the 
download? That is all important stuff, but it is not really the 
cyber battle.
    One of the things that I am concerned about is that when 
you look at the metrics of cases that are produced, again, I 
see some great cases, but I do not see a ton of them. In terms 
of beating down the botnets that attack our systems through 
denial of service attacks, you guys helped, I think, both take 
down the Coreflood and the Rustock botnets. Those were a very 
big deal. The Rustock botnet made a really measurable dent in 
the amount of spam that is out there on the Internet. But there 
is still a ton of that stuff going on, and two great cases but 
it is not a lot of cases.
    I am informed that if you look at intellectual property 
theft through cyber as the means, hacking into an American 
company's computer, accessing their confidential data, their 
formulas, their secrets, exfiltrating that out and then using 
that to compete against the company, we have made exactly zero 
cases; that in all of the cyber cases that we--all the 
intellectual property theft cases that we have made, there has 
been a human link. We have found the guy who is downloading it 
to a disk and putting it in his pocket.
    My impression from my visit to the NCIJTF is that they are 
standing in front of a fire hose trying to do their very best 
to manage around just an immense amount of work. And from what 
I hear from private-sector folks, they would love to have more 
FBI and more federal law enforcement support when they have 
been hacked.
    Now, nine times out of ten, they do not even know they have 
been hacked. They get told they have been hacked when your 
folks or Homeland Security come knocking on the door and say, 
``By the way, you might want to consider looking at this 
file.''
    But once they do know, having more support from you guys I 
think is--I think you are doing a great job with the resources 
you have, but I just feel that we are at a stage where this has 
become such a big problem, both as a national security problem 
to our electric grid, to our financial system, to our 
communications networks, if somebody decides to take those 
down, and as an industrial espionage problem against our major 
competitive industries, and as a privacy problem. There is 
probably somebody in this room right now whose credit card and 
Social Security information is on some Estonian gangster's Web 
site for sale. There is just so much of it for sale right now.
    And so there are all of these issues, and I feel that we 
need--in the same way that we had to move from just having a 
couple of aircraft in the U.S. Army years ago, we have got to 
have an Air Force on this one; that we need to be thinking 
about really what is the next step, how should we structure 
this. It is not enough just to add incrementally. We really 
need to kind of go ``game on'' on this.
    So I would like your thoughts on that point. I know that 
OMB is a bit of a hazard for folks when you are being asked to 
argue beyond your allocated budget. But I would at least like 
to ask you to participate willingly and helpfully and continue 
to, because I have good support so far in trying to help work 
this through. We are trying to get something into the cyber 
bill that will at least put a structure into analyzing what our 
law enforcement posture should look like, how should it be 
resourced for the future. We have got a DEA. We have got an 
ATF. We have got a Secret Service. Maybe we should be thinking 
of building something that is equivalent for cyber as we look 
out.
    What are your thoughts?
    Mr. Mueller. Let me start by saying I share your concern 
about putting the country and the Bureau in a posture to 
address this, and it is going to take a substantial 
reorientation of the Bureau to address this.
    In terms of personnel--and one of the things that too often 
we do is we take pockets of the cyber issue and forget about 
them. And within the Bureau there are a number of initiatives 
we have undertaken over a period of time that fall within the 
cyber umbrella. Certainly the NCIJTF is one of them, and I 
think perhaps one of the most important of them. But, also, 
every one of our 56 field offices has cyber squads in which 
those individuals are doing cyber work.
    Now, there are intrusions, and then there are cases--
innocent images cases, quite obviously, that fall within that. 
But I would say that as we grow, the intrusions are perhaps 
more important. You hate to say that but, more importantly, 
need a different skill and need a different effort.
    My discussions with our people are that we have to reorient 
the Bureau to address cyber in the same we reoriented the 
Bureau to address counterterrorism. That means beefing up our 
cyber squads and making them task forces, because you do not 
know where the cyber intrusion is going to occur, and you need 
to do the forensics in order to start the evaluation of 
attribution, much less the criminal case. And, consequently, it 
has to be distributed across the country, and the expertise has 
to be distributed across the country.
    Now, it takes more of a headquarters role because, 
inevitably, in most of these, with it being botnet or what have 
you, you have victims in all the 50 States, and it may have 
started on Romania or Morocco or what have you. And, 
consequently, the old way of allocating responsibility to the 
office of origin or the first U.S. Attorney who happens to get 
the subpoena in to the grand jury does not work in this 
environment. And so what we are working with in the Bureau is 
putting together a distributed----
    Senator Whitehouse. And if you do not mind me interjecting, 
plus in those cases you really do not have a criminal case. You 
have a civil effort to shut it off, which Rustock and Coreflood 
did brilliantly, but it is hard to sort of tee that up within 
the FBI's structure when there is no criminal case contemplated 
when you are----
    Mr. Mueller. Well, we look at it as national security--I 
mean, this is one of the problems that you have in cyber. At 
the time of the cyber intrusion, you do not know whether it is 
a state actor, you do not know whether it is organized crime or 
organized crime working for a state actor, or an individual or 
group of individuals who are not necessarily organized but 
distributed the anonymous type of attacks or, last, the 18-
year-old who is particularly adept and wants to make his mark 
or her mark by intercepting. And so you cannot immediately put 
it into a cubbyhole of national security or this particular 
crime.
    Consequently, NCIJTF with its 18 counterparts and with the 
distributed network, in my mind, gives us the ability to 
identify that intrusion, work on that intrusion with DHS 
protecting the infrastructure, but our gathering the 
information and helping on identifying the attribution for that 
particular tack.
    I do believe that something like the Regional Computer 
Forensics Laboratories--yes, they do the exploitation, but it 
is the same expertise that you need to do the attribution in 
terms of a cyber attack. So we have got 16 of them. I would 
love to have more of those.
    There are other aspects of the organization, the FBI 
organization, that have to be integrated. You can have cyber 
attacks that are undertaken by terrorists. It can be by state 
actors or espionage. And you need in both of those expertise as 
to who are the terrorists who would undertake it or who were 
the countries and the intelligence agencies of those countries 
who would undertake it. And, consequently, you have to merge 
the cyber expertise along with the substantive expertise in 
that particular area, and we are reorganizing to do that.
    Bottom line, there is a long way to go for all of us, but 
it is a sharing of intelligence and developing the capability 
to take that intelligence and work with not only our persons in 
the United States but within NSA, CIA, and the others outside, 
which that will enable us to be successful in this particular 
arena.
    Senator Whitehouse. Good. Well, I really thank you for the 
excellent work that the Bureau is doing on this, and I look 
forward to working hard to make sure that you have got the 
resources as well that you need.
    I will close by observing that these cases are immensely 
complicated and difficult. If you look at the complicating 
factors that make a case difficult, it has virtually all of 
them. It has probably the worst complicating factor of 
international domain and having to work through legats and 
having to work through treaties and having to work in foreign 
countries. It has the complicating factor of, as you pointed 
out, integration with our intelligence community and having to 
deal with the security and classified nature of some of that 
and protecting sources and methods.
    The cases themselves are challenging and difficult, as 
difficult as any RICO case can be. The forensics are very 
important, trying to figure out how this stuff actually works 
and be able to testify about it clearly. And then there is just 
a lot of work putting it together because some of these things 
are very big operations.
    So when you combine all of that, each case could really be 
a huge vacuum for effort in order to succeed. So I think that 
is an important appreciation that I wanted to put into the 
record as we go about building this. This is not like buy-bust 
gun cases where you can knock them off, you know, one after 
another. These are the kinds of cases that could simply swamp a 
small U.S. Attorney's Office and present immense challenges.
    Mr. Mueller. Well, that is where we push resources, and we 
have to be far more flexible. We have to have virtual teams 
addressing these cases. Both of us have done RICOs. We could do 
RICOs. And these cases are complicated, but one thing that 
often is lost is there is a warm body behind that computer. And 
what you want to do is identify those individuals and arrest 
them and incarcerate them so that there is deterrence. You can 
talk about protecting the networks. You can talk about tracking 
the signature back to some particular country. But then there 
has to be action, and that is where our role comes in.
    Senator Whitehouse. Well, I appreciate it. I think I am the 
last person standing in this hearing, so I will call it to its 
conclusion. I thank you for coming up, as you have so often 
done, to face the oversight of this Committee. You always do so 
very professionally, and your organization is first rate. So we 
are always delighted to have you here.
    The record will remain open for one additional week in case 
there is anything further that anybody wishes to submit. But 
the hearing is closed.
    Mr. Mueller. Thank you.
    Senator Whitehouse. Thank you.
    [Whereupon, at 12:15 p.m., the Committee was adjourned.]
    [Questions and answers and submissions for the record 
follow.]



                            A P P E N D I X

              Additional Material Submitted for the Record

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              Prepared Statement of Chairman Patrick Leahy

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           Prepared Statement of Hon. Robert S. Mueller, III

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                               Questions

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               Responses from Hon. Robert S. Mueller, III

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                Miscellaneous Submissions for the Record

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