Congressional Record, Volume 147 Issue 138 (Monday, October 15, 2001)

[Congressional Record Volume 147, Number 138 (Monday, October 15, 2001)]
[Senate]
[Pages S10676-S10679]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

PROHIBITING UNDERCOVER INVESTIGATIONS

Mr. WYDEN. Mr. President, today I rise to say the national
antiterrorism legislation passed by this body is in grave danger of
being rendered useless. The bill passed by this body corrected an
immediate and severe impediment to the undercover investigations that
must be employed to shut down terrorism in our Nation. The
antiterrorism bill passed by this body included legislation introduced
by Senator Leahy, Senator Hatch, and myself that would untie the hands
of Federal prosecutors in my home State of Oregon and remove the
roadblocks that currently all but prohibit undercover investigations
there.
Unfortunately, the antiterrorism legislation passed by the House
strips that provision and rips back open the enormous loophole that
potentially makes Oregon a safe haven for dangerous criminals and
terrorists everywhere.
For more than a year now, State and Federal prosecuting attorneys in
Oregon have been legally prohibited from advising or participating in
law enforcement undercover investigations. Without advice of counsel,
law enforcement operatives cannot conduct wiretaps, sting operations,
or infiltrate dangerous criminal operations. Covert investigations in
my State have been shut down for more than a year. If the Senate does
not insist on antiterrorism language to restart these investigations in
Oregon, the national antiterrorism legislation will not be national at
all; it will cover 49 States and it will give dangerous criminals,
including terrorists, not just a license but practically an engraved
invitation to set up shop in Oregon with little fear of detection or
apprehension through undercover or covert methods. It would endanger,
not just the people of my State but all Americans.

I wish to explain briefly how this situation came about. It started
here in Washington in 1998. An amendment to the omnibus appropriations
bill started the ball rolling in Washington, DC. A McDade-Murtha
amendment required Federal prosecutors to abide by the State ethics
laws and rules in the State in which they work. In Oregon, the State
bar association enacted a disciplinary rule making it unethical for
attorneys to take part in any practice involving ``deceit or
misrepresentation of any kind.''
When an Oregon attorney misrepresented his identity to investigate a
claim, the State supreme court found him guilty of an ethics violation.
The McDade-Murtha amendment backed that up. It became very clear no
matter how vital the investigation, no matter how great the need, no
matter how dangerous the criminals, attorneys--including Federal,
State, and

[[Page S10677]]

local prosecutors--are simply absolutely not allowed to take a single
step, not even to give advice, to help in an undercover investigation.
If an undercover investigator cannot get advice from a Federal, State,
or local prosecutor, that undercover investigator cannot go forward. It
is that simple: no wiretaps, no sting operations, no infiltrating or
gathering information on any criminal group no matter how dangerous
their bent or how dastardly their plans.
I have been working on a bipartisan basis for more than a year now
with Senator Leahy and Senator Hatch. They have been very helpful, but
the stakes are getting higher and the solution is more important than
ever.
Federal officials have informed me that criminals have admitted that
they set up shop in Oregon because the McDade situation makes it easier
for them to remain undetected and unpunished--even more particularly
sophisticated criminals. But garden-variety criminals have recognized
the opportunities the loophole allows, and certainly more sophisticated
criminal elements and terrorists can as well.

Criminals operating in my State involved in serious crimes such as
child pornography, drug sales, and eco-terrorism have been breathing
easier, safe in the knowledge that law enforcement will have a much
tougher time catching them without the best weapon in the war against
these criminals. Several important investigations have in fact been
terminated or impeded.
For example, the Portland Innocent Images Undercover Program, which
targeted child pornography and exploitation, was shut down when the
U.S. attorney's office informed the FBI field office it would not
concur or participate in the use of long-used and highly productive
techniques such as undercover operations and conventional monitoring of
phone calls that could be deemed excessive.
If unsophisticated criminals were aware of enough to be attracted to
Oregon because of this situation, I am extremely concerned that more
sophisticated criminals and terrorists are equally aware that they can
exploit this loophole.
The House-passed version of the antiterrorism bill undoes the
important work that Senator Leahy, Senator Hatch, and I did on the
bipartisan basis, because the House bill specifically excludes the
language that would fix the McDade problem.
I say today that that must not be acceptable to the Senate. This body
must act, and act now, to find the solution. Senators Hatch and Leahy
and I worked on a bipartisan basis with the FBI and the Department of
Justice to introduce the language that would allow prosecutors in
Oregon to once again advise, consult, and participate in legal
undercover investigations with law enforcement agencies. But if it
doesn't get done in this conference on antiterrorist legislation, my
concern is it will not get done at all.
When the differences between the Senate and House antiterrorism bills
are taken up in conference, Senate conferees must insist that the
McDade fix is in the bill that goes to the President's desk. Anything
less would make this antiterrorism legislation a toothless tiger,
seemingly strong but incapable of defending or protecting any
Americans, including the language that could possibly allow Oregon to
be an easy basing State for future terrorist attacks that would be
devastating to our Nation.
The terrorists made their homes in Florida and New Jersey before
striking Americans in New York and Virginia. I don't want to find 6
months from now that the terrorists made their homes in Oregon because
this body failed in its resolve to shut them down in every State in our
country. Leaving one State vulnerable makes each State in this country
vulnerable.
I implore the conferees, and indeed the Congress, to act swiftly and
judicially to guarantee that our Federal prosecutors and investigators
have these essential tools that they have asked us to support on a
bipartisan basis so they can conduct covert operations that are
necessary to prevent and prosecute criminals in terrorist acts.
I conclude by asking unanimous consent that several news articles
that highlight the concerns Senators Leahy and Hatch and I have on a
bipartisan basis be printed in the Record.
There being no objection, the articles were ordered to be printed in
the Record, as follows:

[From the Chicago Tribune, Aug. 4, 2001]

Oregon Ethics Ruling Chided for Handcuffing Police Work

(By V. Dion Haynes)

For the last year, police and law-enforcement officials say
they have been handcuffed by a state Supreme Court ruling
that all but prohibits undercover work, a staple of crime
investigations.
Nationwide, sting operations--those involving paid
informants, surveillance and undercover officers--have become
the preferred weapon in the investigative arsenals of law-
enforcement agencies battling crime. Typically, prosecutors
direct the operations to ensure that law-enforcement agencies
do not entrap suspects and do not break rules in gathering
evidence.
But prosecutors reluctantly severed their ties to some
undercover investigations and disbanded others after the
Oregon's highest court ruled a year ago that prosecutors are
not exempt from state bar ethics codes prohibiting lawyers
from engaging in ``dishonesty, fraud, deceit or
misrepresentation.''
While the ethics codes of most state bars forbid
dishonesty, Oregon is the only state to apply that rule to
prosecutors involved in undercover investigations in which
informants or detectives must misrepresent themselves.
Undercover operations in Oregon have continued since the
ruling, but without legal advice from prosecutors.

ABA to address issue

The American Bar Association, now meeting in Chicago, plans
to address a related controversy over a federal law requiring
Justice Department prosecutors to submit to state ethics
guidelines.
Some criminal defense lawyers praise the Oregon Supreme
Court ruling, saying all lawyers should be subject to the
same standards. The ruling is helping rein in prosecutors and
investigators who often rely too heavily on undercover work,
they say.
``As a matter of public policy in a democratic system,
government lawyers should not be allowed to engage in deceit
while other lawyers are precluded from doing so by bar
disciplinary rules,'' said Steven Wax, a federal public
defender in Portland.
But the FBI, U.S. attorney's office, Drug Enforcement
Administration, state attorney general, Oregon State Police,
county district attorneys and local police departments say
the ruling has curtailed their investigative work, hindering
their ability to fight narcotics, child-sex abuse,
prostitution, organized crime, housing discrimination and
consumer fraud.
``I think it's generally true that the worst criminals are
smart enough to hide their crimes and can only be found
through undercover operations,'' said Oregon U.S. Atty. Mike
Mosman.
Oregon's court decision, in part, illustrates a long-
standing, bitter dispute over whether Justice Department
prosecutors should be subject to local bar association ethics
codes in the states where they serve.
The debate started during the first Bush administration and
continued in the Clinton administration, when the attorneys
general issued policies exempting federal lawyers from state
ethics codes.

Mc Dade Amendment

Last year, Congress reversed a Justice Department policy
with the so-called McDade Amendment, which requires lawyers
and federal prosecutors in all states to comply with local
ethics and court rules.
The law stemmed from concerns about ``how far should
government go in preventing crime,'' said John Henry Hingson,
a defense attorney in Oregon City, Ore., and a former
president of the National Association of Criminal Defense
Lawyers.
``Many Americans believe that undercover operations go into
entrapment,'' he added.
The question of whether an ethical double standard exists
for government lawyers and defense lawyers arose in Oregon
with the case that prompted the August 2000 state Supreme
Court ruling banning misleading practices by prosecutors.
Using the tactics of government undercover operations,
personal injury lawyer Daniel Gatti allegedly posed as a
doctor in phone calls to an insurance company he was planning
to sue, according to the Oregon State Bar.
Citing the ethics code prohibiting lawyers from using fraud
and deceit, the state high court publicly reprimanded Gatti.
The U.S. Justice Department asked that state Supreme Court
to exempt prosecutors from the code, but the court ruled that
the ethics code does not allow exceptions. The opinion
further forbade lawyers from encouraging anyone else to
participate in the misconduct.
``I have not authorized certain investigations or I have
shut down other investigations because I did not have a
prosecutor or U.S. attorney involved,'' said Capt. Jim
Ferraris of the Portland Police Bureau's drug and vice
division.

Drafting an exemption

A state bar committee is drafting a rule change that would
exempt all prosecutors from the ethics code prohibition on
deception, thereby allowing them to again supervise
undercover operations. If it passes the bar's House of
Delegates next month, the proposed rule would go to the
Supreme Court for final approval. The high court early this
year rejected a similar proposal.

[[Page S10678]]

The Justice Department is pressing Congress to repeal the
law requiring federal prosecutors to follow state ethics
rules and it is suing the Oregon State Bar over its
disciplinary code.
Meanwhile, the American Bar Association is proposing a
change in state ethics codes that would preserve the federal
law's requirement that government prosecutors submit to state
disciplinary rules but would give the Justice Department
latitude in its investigations--with a court order.
____

[From the Associated Press, Oct. 12, 2001]

House Fails To Include Oregon Investigation Measure in Anti-Terrorism
Package

(By Katherine Pfleger)

Washington.--The House anti-terrorism package passed Friday
failed to include a measure designed to remove barriers faced
by federal attorneys conducting covert investigations in
Oregon, Including those into suspected terrorists.
The measure, which the Senate approved Thursday, would have
lifted restrictions in Oregon that hinder federal prosecutors
from approving undercover operations to catch suspected
criminals.
But Reps. Henry Hyde, R-Ill., and at least one other
congressman had the language removed from the House anti-
terrorism package. ``I believe U.S. attorneys ought to obey
ethical requirements of the state,'' Hyde said Friday.
As a result, Sen. Ron Wyden, D-Ore., said he worries that
Oregon could remain ``a safe-haven'' for terrorists and other
criminals. He sponsored the measure with Sen. Patrick Leahy,
D-Vt.
Wyden's Chief of Staff Josh Kardon said the senator won't
discuss classified security issues.
But ``I find it difficult to believe that he would be
putting this many hours into this legislation, with all that
is going on right now, if he don't believe that there is a
current threat to the nation's security,'' Kardon said.
Kardon said withdrawal of White House support contributed
to the measure's downfall.
The restrictions stem from an Oregon Supreme Court decision
that said all attorneys--including federal prosecutors--must
abide by Oregon State Bar ethics rules that prohibit deceit.
A former senior Justice Department official, speaking on
condition of anonymity, said investigators have found
information about the court decision during searches of
suspects, unrelated to the terrorist investigation.
``If the ordinary garden variety of crooks know this, it
paints a bull's eye on the state,'' the official said.
``Looking at what these guys did on Sept. 11, you can see
they paid attention to some pretty sophisticated things.''
Four men with Oregon addresses are on an international list
compiled by anti-terrorism agencies that are tying to lock
down assets of those with suspected ties to the Sept. 11
terrorist attacks. It was inadvertently posted on a Web site
earlier this month by Finland's financial regulator.
None of the men still live in the state.
U.S. Attorney Michael Mosman, Oregon's top law enforcement
officer, wouldn't comment on whether the state court's ruling
was hampering any investigations involving the Sept. 11
terrorist attacks.
However, Mosman said, more broadly the ruling ties the
hands of federal prosecutors working in Oregon, both in
state-specific cases or more sweeping national ones.
``Federal prosecutors are in a box with our sworn oath to
uphold the law, which doesn't allow us currently to do
undercover work, and our sworn duty to protect the public,''
he said.
For instance, Mosman said, in some cases investigators may
need to get approval from the U.S. attorney before using more
serious undercover techniques, such as wiretaps, but Mosman
is barred from participating.
Charles Williamson, a member of the Oregon State Bar board
of governors, said he personally has concerns on his initial
read of Wyden's legislation.
``It may give federal prosecutors too much latitude,''
Williamson said. ``Could they lie to a judge? Could they lie
to defense council in a case?''
Wyden's legislation would have altered the ``McDade
amendment,'' pushed by Hyde and Joe McDade, a former
congressman whose reputation was clouded by an eight-year
racketeering case before he won acquittal in 1996.
The amendment prevented federal prosecutors from using
investigative techniques such as wiretaps, undercover stings
and contacting company whistleblowers that are not barred by
federal law but are disallowed by some ethics rules enforced
by state and local bar associations.
Passed this week, the House and Senate anti-terrorism
packages expanded the FBI's wiretapping authority, imposed
stronger penalties on those who harbor or finance terrorists
and increased punishment for terrorists, among other
measures.
The two versions could go to a conference committee to iron
out the differences, or the Senate cold decide to simply vote
on the House legislation.
Kardon said Wyden is outraged his measure isn't included in
the House bill.
``He has put the Senate leadership on notice that he plans
to fight to retain his legislation in the anti-terrorism
bill,'' Kardon said.
Rep. Greg Walden, R-Ore., is considering a few options,
including efforts to get the legislation passed as a stand-
alone bill, if necessary, said Dallas Boyd, Walden's
legislative assistance for defense.
Meanwhile, Rep. Peter DeFazio, D-Ore., complained the House
bill was cobbled together overnight.
``A lot of people don't know what else was in there,
including me,'' he said. ``It was rushed though the House.
The process broke down.''
____

[From the Portland Oregonian, Oct. 13, 2001]

House Bill Loses Oregon Provision

(By Ashbel S. Green--The Oregonian Staff writer Jim Barnett contributed
to this report)

The U.S. House of Representatives on Friday stripped a
sweeping anti-terrorism bill of a provision designed to allow
suspended federal undercover investigations in Oregon to
resume.
The bill, which included the ``Oregon provision'' in the
version the U.S. Senate passed Thursday night, will head to a
conference committee, where representatives of the two
chambers will try to work out the differences next week.
The Oregon provision would allow federal prosecutors to
supervise undercover operations, even if they required using
deceit.
Sen. Ron Wyden, who proposed the Oregon provision after the
Sept. 11 attacks, and more recently inserted it in the anti-
terrorism bill requested by President Bush, will fight to put
it back into the bill, according to his staff.
Without the provision, ``in essence, the bill will be an
anti-terrorism bill for 49 states,'' said Josh Kardon,
Wyden's chief of staff.'' A bill that addresses only 49
states leaves the entire nation in jeopardy.''
The provision would amend a controversial 1998 law that
requires federal prosecutors to comply with the laws and
state bar rules of every state in which they conduct
enforcement activities.
That law, passed at the behest of Rep. Joseph M. McDade, R-
Pa., and Rep. John P. Murtha, D-Pa., was designed to curtail
prosecutorial excessiveness. McDade was once indicted on
federal corruption charges but later was acquitted.
Murtha and Rep. Henry Hyde, R-Ill., who are big supporters
of the 1998 law, demanded that the Oregon provision be
stripped out of the anti-terrorism bill, Kardon said.
Molly Rowley, a spokeswoman for Senate Majority Leader Tom
Daschle, D-S.D., said the Senate would conduct a legislative
conference on the bill with the House early next week.
Last year, federal law enforcement officials suspended many
undercover operations in response to an Oregon Supreme Court
ruling that prosecutors were excepted from state bar rules
against lawyers' lying.
In 2000, the Oregon Supreme Court upheld a disciplinary
action against Daniel J. Gatti, a Salem attorney who
misrepresented himself as a chiropractor while investigating
whether to file a lawsuit.
The Oregon State Bar responded in January by passing a rule
that allowed all lawyers to supervise undercover operations,
but the Supreme Court rejected the change.
Last month, the bar passed a more limited rule that allowed
only government lawyers and legal aid groups to supervise
undercover operations. The Supreme Court has yet to decide on
that change.
In the meantime, earlier this year the U.S. Department of
Justice sued the state bar over the rule, seeking to block it
from being enforced against federal prosecutors.
A hearing in that case is scheduled for next month.
____

[From the Statesman Journal, Oct. 13, 2001]

House Measure Ignores Oregon

covert criminal investigations are hampered here by restrictive laws

[[Page S10679]]

abide by Oregon State Bar ethics rules that prohibit deceit.
A former senior Justice Department official, speaking on
condition of anonymity, said investigators have found
information about the court decision during searches of
suspects, unrelated to the terrorist investigation.
``If the ordinary garden variety of crooks know this, it
paints a bull's eye on the state,'' the official said.
``Looking at what these guys did on Sept. 11, you can see
they paid attention to some pretty sophisticated things.''

Mr. WYDEN. Thank you, Mr. President. I yield the floor.
The PRESIDENT pro tempore. The Senator from Arizona, Mr. Kyl, is
recognized.
Mr. KYL. Mr. President, I believe that among staff there is an
informal agreement we would extend the morning business time for a
period up to 5 o'clock, which would take us beyond the 4:30 time. When
someone is ready to propound that unanimous consent request, I will be
prepared to stop since my time will go beyond 4:30, which I understand
is the current time. I thought I would note that. I will be
particularly speaking after 4:30 based upon that understanding.
The PRESIDENT pro tempore. Is there objection?
Without objection, it is so ordered.
The Senator is recognized.
Mr. KYL. I thank the Chair.

____________________