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Plot to Spy on Banks Outlined in White House Email

by J. Orlin Grabbe


In the essay "The End of Ordinary Money", I trace government attempts to turn the monetary system into a generalized surveillance system. This has included the overt collection of official data bases on financial transactions, whose ostensive purpose is the prevention or prosecution of money-laundering, as well as covert attempts to spy on the international financial system. These efforts were given their principal boost by the escalation of the war on (some) drugs in the early 1980s.

Recently, White House email from 1986, in particular a memo written by David Wigg and directed to Oliver North, gives information about a joint effort by the National Security Council and the Department of Justice to spy on international banking transfers "through the 400 or so principal banks that make up the interbank market". This memo is reproduced in White House e-mail, edited by Tom Blanton. The memo follows:

To: NSOLN --CPUA 06/05/86 12.35 ***

NOTE FROM: David Wigg SUBJECT: Memo for Ollie North

Scott Sullivan and I met this A.M. with Alan Gerson and Chuck Cooper of DOJ. We presented a proposal to work closely with NSC on a very quiet basis to research ways and means to squeeze off the flow of funds to terrorist organizations in the international financial system (same approach I used for Nic. trade embargo strategy). They were in enthusiastic agreement and are going to begin preliminary research immediately. We see a plan going something as follows:

* Justice looks at existing laws both here and abroad (particularly Europe) to determine legal vehicle(s) needed to monitor/freeze/seize funds flowing to known terrorists. They will have some preliminary info. in about 10 days.

*NSC/Justice calls in XXXXXXXXXXXXXXXXXXX [censored].

*We then put together a comprehensive gameplan to maximally track financial flows from Syria, Libya, Iran, etc. through the 400 or so principal banks that make up the interbank market; to notify and work with European Govs. to fill gaps in our coverage and to cooperate with us in freezing/seizing assets as appropriate (all on confidential basis).

*We also would undertake an overt campaign to selectively expose particular conduits without compromising sources/methods.

*The foundation will all be laid without Treas./State/Comm./STR knowledge and we will go to John with a complete package and plan probably to be presented by him over breakfast to Shultz with Casey/Meese/Weinberger to back him up as appropriate. They can then roll the others after going to the Pres.

If it is done right, and the legal work is right, it should work like the embargo.

When this email was declassified by the National Archive's declassification officer on Aug. 22, 1994, only the paragraph marked above was censored. The email was marked "SECRET/CODE WORD". However, the following day, the same email was marked "TOP SECRET/CODE WORD", and the preceding and following paragraphs (beginning with "Justice looks at" and ending with "confidential basis)." were also deleted.

January 2, 1997
Web Page: http://www.aci.net/kalliste/