Report of the Joint Inquiry Into the Terrorist Attacks of September 11, 2001, by the House Permanent Select Committee on Intelligence and the Senate Select Committee on Intelligence, 2/02, at American Buddha Online Library

REPORT OF THE JOINT INQUIRY INTO THE TERRORIST ATTACKS OF SEPTEMBER 11, 2001

In short, for a variety of reasons, the Intelligence Community failed to capitalize on both the individual and collective significance of available information that appears relevant to the events of September 11. As a result, the Community missed opportunities to disrupt the September 11 plot by denying entry to or detaining would-be hijackers; to at least try to unravel the plot through surveillance and other investigative work within the United States; [page 35] and, finally, to generate a heightened state of alert and thus harden the homeland against attack.

No one will ever know what might have happened had more connections been drawn between these disparate pieces of information. We will never definitively know to what extent the Community would have been able and willing to exploit fully all the opportunities that may have emerged. The important point is that the Intelligence Community, for a variety of reasons, did not bring together and fully appreciate a range of information that could have greatly enhanced its chances of uncovering and preventing Usama Bin Ladin's plan to attack the United States on September 11, 2001.

C. SYSTEMIC FINDINGS

Our review of the events surrounding September 11 has revealed a number of systemic weaknesses that hindered the Intelligence Community's counterterrorism efforts before September 11. If not addressed, these weaknesses will continue to undercut U.S. counterterrorist efforts. In order to minimize the possibility of attacks like September 11 in the future, effective solutions to those problems need to be developed and fully implemented as soon as possible.

1. Finding: Prior to September 11, the Intelligence Community was neither well organized nor equipped, and did not adequately adapt, to meet the challenge posed by global terrorists focused on targets within the domestic United States. Serious gaps existed between the collection coverage provided by U.S. foreign and U.S. domestic intelligence capabilities. The U.S. foreign intelligence agencies paid inadequate attention to the potential for a domestic attack. The CIA's failure to watchlist suspected terrorists aggressively reflected a lack of emphasis on a process designed to protect the homeland from the terrorist threat. As a result, CIA

employees failed to watchlist al-Mihdhar and al-Hazmi. At home, the counterterrorism effort suffered from the lack of an effective domestic intelligence capability. The FBI was unable to identify and monitor effectively the extent of activity by al-Qa'ida and other international terrorist groups operating in the United States. Taken together, these problems greatly exacerbated the nation's vulnerability to an increasingly dangerous and immediate international terrorist threat inside the United States.

[Page 36]

Discussion: The United States has a long history of defining internal threats as either foreign or domestic and assigning responsibility to the intelligence and law enforcement agencies accordingly. This division reflects a fundamental policy choice and is codified in law. For example, the National Security Act of 1947 precludes CIA from exercising any internal security or law enforcement powers. The Congressional investigations of the 1970's into the activities of the intelligence agencies, including their efforts to collect information regarding anti-Vietnam War activists and other "radicals," reinforced the importance of this division in the minds of the Congress, the American public, and the agencies.

The emergence, in the 1990s, of a threat posed by international terrorists who operate across national borders demanded huge changes in focus and approach from intelligence agencies traditionally organized and trained to operate primarily in either the United States or abroad. The legal authorities, operational policies and cultures that had molded agencies like CIA, NSA and the FBI for years had not responded to the "globalization" of terrorism that culminated in the September 11 attacks in the United States. While some efforts, such as the creation of the CTC at CIA in 1986, were made to increase collaboration between these agencies, the agencies focused primarily on what remained essentially separate spheres of operations. In the absence of any collective national strategy, they retained significant autonomy in deciding how to attack and array their resources against Usama Bin Ladin and al-Qa'ida. Efforts to develop such a strategy might have exposed the significant counterterrorism gaps that existed between the agencies as well as the increasingly urgent need to compensate for those gaps in the absence of more fundamental changes in organization and legal authority.

Prior to September 11, CIA and NSA continued to focus the bulk of their efforts on the foreign operations of terrorists. While intelligence reporting indicated that al-

Qa'ida intended to strike in the United States, these agencies believed that defending against this threat was primarily the responsibility of the FBI. This Joint Inquiry found that both agencies routinely passed a large volume of intelligence to the FBI, but that neither agency followed up to determine what the FBI learned from or did with that [page 37] information. Neither did the FBI keep NSA and CIA adequately informed of developments within its areas of responsibility.

As noted earlier, the record confirms instances where, despite numerous opportunities, information that was directly relevant to the domestic threat was simply overlooked and not disseminated in a timely manner to the FBI. For example, the CIA analyst who neglected to raise the information concerning al-Mihdhar and al-Hazmi's U.S. travel in a June 2001 meeting with the FBI in New York said in a Joint Inquiry interview that the information he had learned concerning the pair's travel to Los Angeles "did not mean anything to him." He also explained to the Joint Inquiry that the information was operational in nature and he would have needed permission before disclosing it.

The CIA's inconsistent performance regarding the watchlisting of suspected terrorists prior to September 11 also suggests a lack of attention to the domestic threat. Watchlists are a vital link in denying entry to the United States by terrorists and others who threaten the national security, and CTC had reminded personnel of the importance of watchlisting in December 1999 (see Appendix, "CTC Watchlisting Guidance - December 1999"). Yet, some CIA officers in CTC indicated they did not put much emphasis on watchlists. The Joint Inquiry confirmed that there was no formal process in place at the CTC prior to September 11 for watchlisting suspected terrorists, even where, as was the case with al-Hazmi and al-Mihdhar, there were indications of travel to the United States.

Other CIA personnel reported that they received no training on watchlisting and that names were added on an ad hoc basis. In the days and weeks following the September 11 attacks, more focused CIA review of over 1,500 Classified Intelligence Reports that had not previously been provided to the State Department for watchlist purposes resulted in the identification of 150 suspected terrorists and the addition of 58

suspected terrorist names to the watchlist. DCI Tenet acknowledged in his testimony before the Joint Inquiry that CIA's watchlisting training had been deficient and that a [page 38] mistake had been made in the failure to watchlist both al-Mihdhar and al- Hazmi promptly.

[There were also gaps between NSA's coverage of foreign communications and the FBI's coverage of domestic communications that suggest a lack of sufficient attention to the domestic threat. Prior to September 11, neither agency focused on the importance of identifying and then ensuring coverage of communications between the United States and suspected terrorist-associated facilities abroad [ ]. Consistent with its focus on communications abroad, NSA adopted a policy that avoided intercepting the communications between individuals in the United States and foreign countries].

NSA adopted this policy even though the collection of such communications is within its mission and it would have been possible for NSA to obtain FISA Court authorization for such collection. NSA Director Hayden testified to the Joint Inquiry that NSA did not want to be perceived as targeting individuals in the United States and believed that the FBI was instead responsible for conducting such surveillance. NSA did not, however, develop a plan with the FBI to collect and to ensure the dissemination of any relevant foreign intelligence to appropriate domestic agencies. This further evidences the slow response of the Intelligence Community to the developing transnational threat.

[The Joint Inquiry has learned that one of the future hijackers communicated with a known terrorist facility in the Middle East while he was living in the United States. The Intelligence Community did not identify the domestic origin of those communications prior to September 11, 2001 so that additional FBI investigative efforts could be coordinated. Despite this country's substantial advantages, there was insufficient focus on what many would have thought was among the most critically important kinds of terrorist-related communications, at least in terms of protecting the Homeland].

[Page 39]

While most of the Intelligence Community focused on the collection of foreign intelligence, the Joint Inquiry was told repeatedly that the nation lacked an effective domestic intelligence capability prior to September 11. Former National Coordinator for Counterterrorism Richard Clarke saw this as a longstanding problem that became painfully obvious in the aftermath of September 11:

Well, I hear all of these comments about the Phoenix memo, the Minnesota case, whatever. I think they miss the point that the failures were years earlier. It was a failure on the part of the United States to not have a domestic intelligence collection capability. I understand the reasons for the lack of the ability. I know the abuses the FBI engaged in [during] the 1950s and 1960s. I know the reason we have the Attorney General-levied guidelines. But I think the pendulum swung too far, and when we became aware of the fact that there were forces in the world such as al- Qa'ida, and others, Iran, Hezbollah, that meant us ill, certainly by the 1980s or 1990s we should have recognized the need for a domestic intelligence collection capability. Other democracies with civil rights and civil liberties have that. It doesn't mean you become a totalitarian state if you do a good job of oversight and control. We needed to have a domestic intelligence collection and analysis capability, and we did not have it, and only now are we beginning to get it.

. . . .

But my point about the FBI was not just a few hints were missed or dots weren't connected; it is - my point was, they didn't have the mission. It was not their job to be a domestic collection service. Their job was to do law enforcement. And they didn't have the rules that permitted them to do domestic intelligence collection.

While the FBI's counterterrorist program had produced successful investigations and major prosecutions of both domestic and international terrorists, numerous witnesses told the Joint Inquiry that the program was, at least prior to September 11, incapable of producing significant intelligence products. The FBI's traditional reliance on an aggressive, case-oriented, law enforcement approach did not encourage the broader collection and analysis efforts that are critical to the intelligence mission. Lacking appropriate personnel, training, and information systems, the FBI primarily gathered intelligence to support specific investigations, not to conduct all-source analysis for dissemination to other intelligence agencies. Former National Security Advisor Sandy Berger testified about the FBI's failure, prior to September 11, to assess the extent of the foreign terrorist threat to the United States adequately: [page 40]

Until the very end of our term in office, the view we received from the Bureau was that al-Qa'ida had limited capacity to operate in the United

States and that any presence here was under surveillance. That was not implausible at the time. With the exception of the World Trade Center bombings in 1993, not attributed before 9/11 to Bin Ladin, plots by foreign terrorists within the United States have been detected and stopped. But revelations since September 11 have made it clear that the Bureau underestimated the domestic threat. The stream of threat information we received continuously from the FBI and CIA pointed overwhelmingly to attacks on U.S. interests abroad. Certainly, the potential for attacks in the United States was there.

Former National Security Advisor Brent Scowcroft told the Joint Inquiry hearing on September 19, 2002, that:

. . . .I was thinking back [on] intelligence information from the FBI, and I was trying to think of cases where we actually got it. Not very much, because we are or I was focused on foreign intelligence primarily. There was some counterintelligence issues where the FBI intelligence was particularly involved, and the one case I mentioned. Pan Am 103, but that was investigative intelligence and the FBI and the CIA did an absolutely brilliant job on that. But I can't think of many--can't recall of any instances of pure intelligence product from the FBI. And I don't say that pejoratively at all.

Former National Coordinator for Counterterrorism Richard Clarke voiced similar concerns about the extent of the FBI's understanding of the domestic threat:

Let me give you the FBI case, because I think it is the most clear. Following the Millennium alert . . . and . . . review, it became very clear to . . . the [FBI] Assistant Director for Counterterrorism, there was the potential for sleeper cells in the United States, people . . . the United States that had been involved in the planned attacks.

. . . .

This was in 2000. The Assistant Director . . . then began a program to try to get more control of the 56 FBI field offices, and I visited five or six of the field offices and asked them what they were doing about al-Qa'ida. I got sort of blank looks of "what is al-Qa'ida?"

He compared the effort to add priority to al-Qa'ida investigations in the FBI field offices to "trying to . . . sort of turn this big Queen Mary luxury liner, trying to turn it."

[Page 41]

Numerous individuals told this Inquiry that the FBI's 56 field offices enjoy a great deal of latitude in managing their work, consistent with the dynamic and reactive nature of its traditional law enforcement mission. In counterterrorism efforts, however, that flexibility apparently served to dilute the FBI's national focus on Bin Ladin and al-

Qa'ida. Although the FBI made counterterrorism a "Tier One" priority, not all of its field offices responded consistently to this FBI Headquarters decision. The New York Field Office did make terrorism a high priority and was given substantial responsibility for the al-Qa'ida target following the first attack on the World Trade Center in 1993. However, many other FBI offices were not focused on al-Qa'ida and had little understanding of the extent of the threat it posed within this country prior to September 11.

The combination of these factors seriously handicapped efforts to identify and defend against the foreign terrorist threat to the domestic United States. It is not surprising, in the absence of more focused intelligence, that senior policymakers told this Inquiry that, prior to September 11, they believed the terrorist threat was focused on U.S. interests overseas. Deputy Secretary of State Armitage, for example, testified that ". . . I don't think we really had made the leap in our mind that we are no longer safe behind these two great oceans. . . ." Former Deputy Secretary of Defense John Hamre said in a Joint Inquiry interview that he could not remember ever seeing an intelligence report on the existence of terrorist sleeper cells in the United States. In retrospect, he recalled: ". . . we thought we were dealing in important things, but we missed the domestic threat from international terrorism."

2. Finding: Prior to September 11, 2001, neither the U.S. Government as a whole nor the Intelligence Community had a comprehensive counterterrorist strategy for combating the threat posed by Usama Bin Ladin. Furthermore, the Director of Central Intelligence (DCI) was either unwilling or unable to marshal the full range of Intelligence Community resources necessary to combat the growing threat to the United States.

Discussion: The Intelligence Community is a large distributed organism. It encompasses 14 agencies and tens of thousands of employees. The number of people [page 42] employed exclusively in the effort against Usama Bin Ladin and al-Qa'ida was relatively small. In addition, these people were operating in geographically dispersed locations, often not connected by secure information technologies, and within established bureaucracies that were not culturally or organizationally attuned to one another's requirements. Many of them had limited experience against the target, and did not know one another. To achieve success in such an environment, leadership is a critical factor. The Joint Inquiry found that the Intelligence Community's structure made leadership difficult.

Usama Bin Ladin first came to the attention of the Intelligence Community in the early 1990s, initially as a financier of terrorist activities. In 1996, as Bin Ladin's direct involvement in planning and directing terrorist acts became more evident, the DCI's Counterterrorist Center (CTC) created a special unit to focus specifically on him and the threat he posed to the interests of the United States. Personnel within CTC recognized as early as 1996 and 1997 that Usama Bin Ladin posed a grave danger to the United States.

Following the August 1998 bombings of two U.S. embassies in East Africa, the DCI made combating the threat posed by Usama Bin Ladin one of the Intelligence Community's highest priorities, establishing it as a "Tier 0 priority." The DCI raised the status of the Bin Ladin threat still further when he announced in writing in December 1998 regarding Bin Ladin: "We are at war…I want no resources or people spared in this effort, either inside the CIA or the [Intelligence] Community." This declaration appeared in a memorandum from the DCI to CIA senior managers, the Deputy DCI for Community Management and the Assistant DCI for Military Support.

The Intelligence Community as a whole, however, had only a limited awareness of this declaration. For example, some senior managers in the National Security Agency and the Defense Intelligence Agency say they were aware of the declaration. However, it was apparently not well known within the Federal Bureau of Investigation. In fact, the Assistant Director of the FBI's Counterterrorism Division testified to the Joint Inquiry that he "was not specifically aware of that declaration of war."

[Page 43]

Furthermore, and even more disturbing, Joint Inquiry interviews of FBI field office personnel indicated that they were not aware of the DCI's declaration, and some had only a passing familiarity with the very existence of Usama Bin Ladin and al-Qa'ida prior to September 11. Neither were the Deputy Secretary of Defense or the Chairman of the Joint Chiefs of Staff aware of the DCI's declaration. This suggests a fragmented Intelligence Community that was operating without a comprehensive strategy for combating the threat posed by Bin Ladin, and a DCI without the ability to enforce consistent priorities at all levels throughout the Community.

The Director of NSA at the time of the DCI's 1998 declaration was Lieutenant General Kenneth Minihan. He acknowledged in a Joint Inquiry interview that he was aware of that declaration, but believed that the DCI was speaking for CIA only. In his experience, he said, the DCI generally left Intelligence Community matters to the head of the Community Management Staff.

The record of this Joint Inquiry indicates that the DCI did not marshal resources effectively even within CIA against the threat posed by al-Qa'ida. Despite the DCI's declaration to CIA officials that the Agency was at war with Bin Ladin, there is substantial evidence that the DCI's Counterterrorist Center needed additional personnel prior to September 11, and that the lack of resources had a substantial impact on its ability to detect and monitor al-Qa'ida's activities. For example:

o In a September 12, 2002 Joint Inquiry hearing, the former Chief of CTC testified that he did not have enough people to counter the threat posed by Bin Ladin's network: "The three concepts I would like to leave you with are people, the finances, and operational approvals or political authorities. We didn't have enough of any of these before 9/11."

o In the same hearing, a senior CTC manager said, "Did we have enough personnel resources? No. We always needed more."

[Page 44]

o In the same hearing, a former Chief of the CTC unit dedicated to focusing on Bin Ladin explained: "We never had enough officers from the Directorate of Operations. The officers we had were greatly overworked….We also received marginal analytic support from the Directorate of Intelligence…."

o In a September 20, 2002 Joint Inquiry hearing, a CIA officer commented on the reasons for the CIA's failure to follow-up regarding the two September 11 hijackers who came to the attention of the Intelligence Community in January 2000:

How could these misses have occurred?… The CIA operators focused on the Malaysia meeting while it occurred; when it was over, they focused on

other, more urgent operations against threats real or assessed. Of the many people involved, no one detected that the data generated by this operation crossed a reporting threshold, or, if they did, they assumed that the reporting requirement had been met elsewhere…. They are the kinds of misses that happen when people - even very competent, dedicated people such as the CIA officers and FBI agents and analysts involved in all aspects of this story - are simply overwhelmed.

o When asked why there was no marshaling of personnel to CTC to fight Bin Ladin's network, the former Chief of CTC recalled that the CIA's Deputy Director of Operations said there were not enough personnel to go around and CTC was already well-endowed with people as compared to other divisions in CIA.

Almost immediately after September 11, 2001, there was a substantial infusion of personnel into the CTC. No comparable shift of resources occurred in December 1998 after the DCI's declaration of war, in December 1999 during the Millennium crisis, or after the attack on USS Cole in October 2000.

In his testimony before the Joint Inquiry on October 17, 2002, the DCI said, "In hindsight, I wish I had said, 'Let's take the whole enterprise down,' and put 500 more people there sooner." It is noteworthy that the DCI's comments were limited to the CIA [page 45] and did not encompass marshaling the resources of other agencies within the Intelligence Community.

Despite the DCI's December 1998 declaration of war, other priorities continued to detract from the Intelligence Community's effort against Bin Ladin. The Joint Inquiry heard repeatedly about intelligence priorities that competed contemporaneously with Bin Ladin for personnel and funds. These included a range of regional and global issues. The NSA Director described the pre- September 11 situation at NSA:

We, like everyone else at the table, were stretched thin in September. The war against terrorism was our number one priority. We had about five number one priorities. And we had to balance what we were doing against all of them. . . . .

[Further, the NSA Director testified that he knew what NSA had to do to improve its capabilities against the modern means of communications used by Bin Ladin and other

targets prior to September 11, but was unable to obtain Intelligence Community support and resources for that effort:

Given all the other intelligence priorities, it would have been difficult at that time within the [Intelligence Community] or the Department of Defense to accept the kind of resource decisions that would have been necessary to make our effort against the target more robust. NSA was focused heavily on [a range of regional and global issues]. Our resources, both human and financial, were in decline. Our efforts in 2000 to churn money internally were not accepted by the Community; its reliance on [signals intelligence] had made it reluctant to give it up].

The inability to realign Intelligence Community resources to combat the threat posed by Usama Bin Ladin is a relatively direct consequence of the limited authority of the DCI over major portions of the Intelligence Community. As former Senator Warren Rudman noted on October 8, 2002 in his testimony before the Joint Inquiry: "You have a Director of Central Intelligence who is also the Director of CIA; eighty-five percent of [the Intelligence Community's budget] is controlled by the Department of Defense."

[Page 46]

While the DCI has statutory responsibility that spans the Intelligence Community, his actual authorities are limited to the budgets and personnel over which he exercises direct control, i.e., the CIA, the Office of the DCI, and the Community Management Staff. As former Congressman and House Intelligence Committee Chairman Lee Hamilton stated in his testimony to the Joint Inquiry on October 3, 2002:

Currently, the Director of Central Intelligence, the leading intelligence figure, as we all know, does not control but a small portion of his budget. The DCI has, as I understand it, enhanced authority after 1997, and that permits him to consolidate the national intelligence budget, to make some trade-offs, but given the overwhelming weight of the Defense Department in the process, that is of limited value.

. . . .

The very phrase "Intelligence Community" is intriguing. It demonstrates how decentralized and fragmented our intelligence capabilities are. . . . The Intelligence Community is a very loose confederation. . . .

. . . .

[T]he thing that puzzles me here is why we reject for the Intelligence Community the model of organization that we follow in every other enterprise in this country. We have someone at the head who has responsibility and accountability. We accept that. But for some reason we reject it when it comes to the Intelligence Community.

43

Further evidence of the absence of authoritative leadership and a comprehensive counterterrorist strategy can be found in what the DCI referred to in his Joint Inquiry testimony on October 17, 2002 as "The Plan." In his testimony, the DCI said:

In spring of 1999, we produced a new comprehensive operational plan of attack against [Usama Bin Ladin] and al Qaeda inside and outside of Afghanistan. The strategy was previewed to senior CIA management by the end of July of 1999. By mid-September it had been briefed to the CIA operational level personnel, to NSA, to the FBI and other partners. The CIA began to put in place the elements of this operational strategy which structured the agency's counterterrorism activity until September 11 of 2001.

[According to documents reviewed by the Joint Inquiry, "The Plan" of 1999 consisted primarily of a variety of CIA covert action efforts directed against Usama Bin Ladin. Later, "The Plan" also included []. Thus, "The Plan" was focused principally on CIA, Afghanistan, covert action, and technical collection aimed at Usama Bin Ladin].

From a broader perspective, "The Plan" was significant for what it did not include:

o An Intelligence Community-wide estimate of the threat posed by Usama Bin Ladin's network to the United States and to U.S. interests overseas;
o Significant participation by other elements of the Intelligence Community;
o A delineation of the resources required to execute "The Plan;"
o Any decisions to downgrade other Intelligence Community priorities to accommodate the priority of "The Plan;"
o Any attention to the threat to and vulnerabilities of the U.S. homeland; and
o Any FBI involvement.

The absence of involvement by agencies other than CIA in "The Plan" is particularly troubling, given gaps that existed in the efforts by other agencies to address Bin Ladin. While the CIA was putting significant effort and attention into Usama Bin Ladin, covert action, and Afghanistan, the FBI, for example, was focused on other issues. Although FBI leadership recognized after the Embassy bombings in August 1998 that al-

Qa'ida posed an increasing threat to United States interests, investigations in the United States of those who raised funds for other terrorist groups continued to consume considerable field resources and attention prior to September 11.

While the FBI devoted considerable resources to the criminal investigations of the terrorist attacks overseas, substantial efforts to prevent similar attacks at home were lacking. Former National Security Advisor Sandy Berger told the Joint Inquiry: ". . . if there was a flood of intelligence information [on terrorism] from the CIA, there was hardly a trickle from the FBI." In some FBI field offices, there was little focus on, or awareness of, Usama Bin Ladin and al-Qa'ida. This included the San Diego field office where FBI agents would discover, after September 11, that there had been numerous local connections to at least two of the hijackers.

[Page 48]

The Executive Assistant Director of the FBI's Counterterrorism Division testified to the Joint Inquiry that the FBI had no war plan against Bin Ladin: "Did we have a war plan, a five-paragraph ops order issued on Usama Bin Ladin and al-Qa'ida? Absolutely, we did not at that time." When asked how the FBI's counterterrorism program fit into the overall Intelligence Community counterterrorism program, the same Assistant Director replied: "I am not sure if I know the answer to that. I talked to [the DCI] briefly about this. I have talked to [the CTC Chief] prior to -- the answer to your question is, I don't know the answer." Without a comprehensive strategy in place for the whole Intelligence Community, there was no assurance that agencies like the FBI were focused on the DCI's "war" effort.

Consistent with the absence of any comprehensive strategy, a recent Department of Justice Inspector General (IG) report found that: "The FBI has never performed a comprehensive written assessment of the risk of the terrorist threat facing the United States." As the IG report explained: "Such an assessment would be useful not only to define the nature, likelihood, and severity of the threat but also to identify intelligence gaps that need to be addressed. Moreover, we believe that comprehensive threat and risk assessments would be useful in determining where to allocate attention and resources...on programs and initiatives to combat terrorism." This kind of assessment still had not been completed as recently as Director Mueller's testimony on October 17, 2002. Nor did the DCI's National Intelligence

Council ever produce a National Intelligence Estimate (NIE) regarding the threat to the United States posed by al-Qa'ida or Usama Bin Ladin.

Without the support of a comprehensive strategy or credible domestic threat assessment, DCI resource requests were often unsuccessful. In response to questions about his own efforts to obtain additional counterterrorism resources, the DCI described to the Joint Inquiry hearing on June 18, 2002 his inability, prior to September 11, to generate necessary support within the Executive Branch:

[I would ask e]very year in [the] budget submission. [Page 49]

. . . .

I'm not talking about the Committee. I'm talking about the front end at OMB and the hurdle you have to get through to fully fund what we thought we needed to do the job. Senator Kyl once asked me a question in Senator Shelby's Committee and said, how much money are you short. I'm short $900 million to $1 billion every year for the next five years, is what I answered. And we told that to everybody downtown for as long as anybody would listen and never got to first base. So you get what you pay for in terms of our ability to be as big and robust as people - and when I became Director, we had [ ] case officers around the world. Now we're up to about [ ] and the President's given us the ability to grow that by another [ ]. And everybody wonders why you can't do all the things people say you need to do. Well, if you don't pay at the front end, it ain't going to be there at the back end. Having said that, I think we made an enormous amount of progress against this target. That would be my view].

3. Finding: Between the end of the Cold War and September 11, 2001, overall Intelligence Community funding fell or remained even in constant dollars, while funding for the Community's counterterrorism efforts increased considerably. Despite those increases, the accumulation of intelligence priorities, a burdensome requirements process, the overall decline in Intelligence Community funding, and reliance on supplemental appropriations made it difficult to allocate Community resources effectively against an evolving terrorist threat. Inefficiencies in the resource and requirements process were compounded by problems in Intelligence Community budgeting practices and procedures.

Discussion: [Throughout the Joint Inquiry, numerous officials at CIA, NSA and the FBI testified that the greatest constraint in their effort against al-Qa'ida was the availability of too few resources, compounded by too many requirements and priorities. Regional and global issues were identified as some of the other important issues that competed with counterterrorism and made heavy resource demands].

These other policy priorities demanded the support of the Intelligence Community and made it difficult to transfer people or funds to counterterrorism. DCI Tenet testified that:

As I 'declared war' against al-Qa'ida in 1998 - in the aftermath of the East Africa embassy bombings - we were in our fifth year of round-the-clock support to Operation Southern Watch in Iraq. Just three months earlier, we were embroiled in answering questions on the India and Pakistan nuclear tests and trying to determine how we could surge more people to understanding and countering [page 50] weapons of mass destruction proliferation. In early 1999, we surged more than 800 analysts and redirected collection assets from across the Intelligence Community to support the NATO bombing campaign against the Federal Republic of Yugoslavia.

[Similarly, NSA Director Hayden testified that NSA was focused heavily on several other high priority intelligence targets. An FBI budget official told the Joint Inquiry that counterterrorism was not a priority for Attorney General Ashcroft before September 11, and the FBI faced pressure to make cuts in counterterrorism to satisfy his other priorities].

The Joint Inquiry's review of available budget and resource data confirmed that, overall, the Intelligence Community budget peaked in fiscal year 1992 and thereafter fell or remained even in constant dollars. The FBI is an exception to the overall resource picture. Its overall funding increased for much of the 1990s, though most of this went to the Bureau's non-intelligence programs.

[In all, however, Intelligence Community capabilities declined over time. At the CIA, for example, the Directorate of Operations cut the number of its personnel deployed overseas by almost [ ] and closed down a portion of facilities in one part of the world - where much information relating to terrorism could likely have been available. In addition, the necessary support "tail" for counterterrorism, such as communications and training, suffered from the decline in resources].

Specific funding for counterterrorism was, however, at least one exception to the overall budget decline. Within existing budgets, counterterrorism spending generally

increased while funding for other issues generally fell or remained steady. The counterterrorism component of the overall Intelligence Community budget, for example, at least doubled at most agencies. Former National Security Advisor Sandy Berger emphasized the added funding that was provided for counterterrorism: [page 51]

. . . the Clinton Administration more than doubled the federal government's counterterrorism spending from $5 billion in FY [Fiscal Year] 1996 to over $11 billion in FY 2000) at a time of strong bipartisan effort to achieve balanced budgets that resulted in highly constrained spending for most programs. . . [T]he FBI's counterterrorism staff budget increased by 250% and their counterterrorism budget increased by nearly 350%. Similar increases were made in the CIA counterterrorism budget.

In general, personnel allocated to counterterrorism also increased. Although specifics are imprecise, this Inquiry's review and estimates provided by various agencies indicate that the number of personnel working on terrorism steadily increased despite overall decreases in Intelligence Community staffing. Nevertheless, the number of counterterrorism personnel prior to September 11 generally remained small and paled by comparison with post-September 11 levels.

During the course of the Joint Inquiry, Intelligence Community officials identified a number of factors that limited their ability to allocate greater resources for counterterrorism, despite the funding increases that occurred in that area. These included, in addition to the overall general decline in funding for intelligence, outdated and unrealistic intelligence priorities, and an overburdened requirements process.

The Intelligence Community's current strategic-level guidance for national security priorities was established by Presidential Decision Directive (PDD)-35 in 1995. Former National Security Advisor Anthony Lake described PDD-35 as follows: "It formally established our top intelligence priorities and placed terrorism among them, led only by intelligence support for our troops in the field and a small number of states that posed an immediate or potential serious threat to the United States." In an effort to rank the myriad post-Cold War threats facing the United States, PDD-35 established a tier system of priorities. The tiers were broad and concentrated at the upper levels of the scale. For example, there were both Tier 1A and Tier 1B priorities, but the highest priority was assigned to Tier Zero.

[Page 52]

However, as several Intelligence Community officers told the Joint Inquiry, in practice, the lack of adequate separation between the tiers made it very difficult to choose between priorities, and the intelligence prioritization process was often confusing. Former National Counterterrorism Coordinator Richard Clarke noted that the White House "…never really gave good systematic, timely guidance to the Intelligence Community about what priorities were at the national level." Deputy National Security Advisor Steven Hadley responded to Joint Inquiry questions by stating that Bush Administration officials were told by Clinton Administration officials during the transition that "this priority-setting process [PDD-35] … was not effective for communicating changing priorities over time." Joint Inquiry interviews with Intelligence Community officials indicate that many felt that the prioritization process was so broad as to be meaningless.

Moreover, PDD-35 was never effectively adapted before September 11 to meet the changing nature of the threat, despite specific language in the document that required an annual review. As certain threats, including terrorism, increased in the late 1990s, none of the "lower level" Tier 1 priorities were downgraded so that resources --money and people-- could be reallocated. For much of the Intelligence Community, everything became a priority since its customers in the U.S. Government wanted to know everything about everything all the time.

The growing inadequacy of the PDD-35 structure fueled an overburdened and increasingly ineffective requirements system within the Intelligence Community. At NSA, for example, an official described the PDD-35 requirements system as "cumbersome." NSA analysts acknowledged that they had far too many broad requirements -- some 1500 formal requirements by September 11 -- that covered virtually every situation and target. Working from these 1500 formal requirements, NSA had developed almost 200,000 "Essential Elements of Information" that were desired by its customers. While they understood the gross priorities and worked on the requirements that were practicable on any given day, several NSA analysts acknowledged that the [page 53] priority demands sometimes precluded them from delving as deeply into certain areas as they would have liked.

As counterterrorism became an increasingly important concern for senior Intelligence Community officials, collection and analytic efforts did not always keep pace because other requirements competed with terrorism for attention, and real priorities often were not clear. In Joint Inquiry interviews, CIA officials said that, because overall resources were finite, any increased focus on counterterrorism meant that other issues would have to receive less attention. At the FBI, where overall funding had increased, officials said that substantial efforts focused on investigating terrorist cases overseas, critical infrastructure protection programs, and other priorities not directly related to strategic intelligence or al-Qa'ida activity within the United States.

[The Director of NSA testified that prior to September 11, other priorities frustrated his attempts to acquire capabilities to process modern communications used by terrorists and other intelligence targets:

It required a significant redirection of investment for us to acquire the capabilities to exploit modern communications. I mentioned . . .trying to churn . . .within what was then a fixed top line about $200 million . . . . And we could only get about a third of it to stick because the people who were using the products we created out of traditional means were unable to give up those product lines to allow us to reinvest those dollars for the new age signals environment . . . . I was unable to move some money because we were going to erode our coverage of [another intelligence target] as part of this effort.]

Even within the CTC, the staff and resources dedicated to counterterrorism could not keep pace with the amount and scope of incoming intelligence reporting. The DCI attributed CIA inaction on a cable pointing to al-Hazmi's travel to the United States to the fact that overworked CTC personnel did not have time to read "information only" cables from the field:

The cable that came in from the field at the time, sir, was labeled "information only," and I know that nobody read that cable. . . . Sir, we weren't aware of it [page 54] when it came into headquarters. We couldn't have notified the [FBI]. Nobody read that cable in the March time frame. . . . It was an information-only cable from the field and nobody read that information-only cable. [In hindsight, of] course it should have been.

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Another CIA official indicated, post-September 11: "The second thing that was clear, as I showed [CTC personnel] the cable from March 5, [2000] -- just the look on their face told me everything I needed to know. They just hadn't seen it. It passed them by." The former CTC Chief added:

We have asked everyone have you seen this and what action was taken. It did not attract appropriate attention so that they could have been watchlisted. I think the Director has already mentioned that that was not done at the time. I think that it was reasonable by certainly March 5 that we would have been in the position, we should have been in a position to firmly watchlist this. I just have to underscore that we do this hundreds of times a month. It should have been done. It was not. We have very good people working this issue. It was not done, and it was not done because of the press of lots of other work. We probably should have picked up on this in early March, but we'd gone by for two months. The delay in that, sir, was the [ ], took about six weeks to get that information to us, and in March we should have picked up on it. All things being equal, they should have been watchlisted; I think that month we watchlisted about 150 people. It should have been done. It wasn't. It was a fact of life. And I think what contributed to that was these same officers watching this operation were also doing a lot of other things. So it's like balls in the air. There gets to a point where you don't treat each one with the attention that it deserves.

There was also a March 6, 2001 cable from the field that called attention to the portion of the March 5 cable regarding al-Hazmi's travel to the United States, but CTC personnel also did not read that cable at the time.

Senior NSA and CIA officials have acknowledged that, in hindsight, they would have devoted many more personnel resources to the al-Qa'ida target and expedited the development of certain collection capabilities. However, they testified that the operating environment prior to September 11 - a combination of escalating requirements and limited resources - limited their ability to respond to the growing terrorist threat.

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Those problems were aggravated by shortcomings that existed in the Intelligence Community's budgeting practices. The President annually submits to Congress an Intelligence Community budget for the coming fiscal year. Included in that request are both ongoing and new programs that are subject to long established, well understood oversight and accountability procedures. Supplemental appropriations usually are granted in reaction to unforeseen events that are not part of the President's budget

request. Since it is temporary by nature, supplemental funding is not meant to pay for additional personnel or for structural upgrades in future years.

The Intelligence Community received large supplemental appropriations from 1998 to 2001 to fight terrorism. These additional funds were provided by Congress following several major al-Qa'ida attacks and to support the effort during the Millennium celebrations. In particular, most of CIA's and some of NSA's efforts against al-Qa'ida in the late 1990's were funded from supplemental appropriations.

In Joint Inquiry interviews, Intelligence Community officials were critical of this reliance on supplementals for counterterrorism programs. A former CTC Chief, for example, told the Joint Inquiry that reliance on supplementals made it hard to create a stable counterterrorism program. He noted that it is far more difficult to develop plans for hiring and training personnel and to pursue long-term technical programs that require years to develop without a stable year-to-year funding basis.

Despite such limitations, the Intelligence Community agencies sought additional supplemental appropriations to sustain its counterterrorism effort rather than alter the President's budget request to provide annual counterterrorism funding. This is because altering the annual budget request would have required the Intelligence Community agencies to make substantial reductions in other programs, a course they were reluctant to follow because of the many other intelligence priorities for which they were responsible.

Certain other Intelligence Community budgeting practices and procedures further impeded efforts to ensure an effective allocation of resources to counterterrorism. A lack [page 56] of transparency in agency budgets made it very difficult to determine whether the counterterrorism mission was properly funded because counterterrorism is not an explicit Intelligence Community budget category. Instead, each Intelligence Community agency budget consists of a compilation of funding levels desired for specific capabilities, such as the cost of a particular number of intelligence officers or satellites. Many of these capabilities are useful for more than one mission. For example, a CIA operations officer may collect intelligence on the internal politics of a country, a weapons shipment, and terrorism. The CIA considered having its personnel record the time they

expend on various missions, as do FBI field officers, but this was rejected due to the perceived administrative burden it would impose.

This makes it very difficult to measure the amount of resources that the Intelligence Community allocates to a particular mission such as counterterrorism. As a result of this ambiguity, the Intelligence Community often does not know how much it spends on different issues and, therefore, is unable to compare the funding levels it is devoting to one mission versus another. For example, the CIA had great difficulty determining for this Inquiry precisely how many of its personnel worked on al-Qa'ida in recent years.

Moreover, different components of the Intelligence Community use different measures when they do try to determine how much they spend on missions such as counterterrorism. To further complicate matters, there is no agreed-upon way to measure the level of indirect costs, such as communications, that is devoted to counterterrorism versus other mission areas. Congressional overseers as well as senior Intelligence Community managers thus find it difficult to judge whether agency resource allocations reflect overall intelligence priorities.

In Fiscal Year 1999, the Office of Management and Budget began to require that the Intelligence Community identify counterterrorism spending in each agency. However, this information is gathered after money is spent, rather than as a planning and accountability tool for Intelligence Community managers. In addition, the information is [page 57] collected manually, is not subject to systematic controls and does not constitute much more than an educated estimate.

Finally, the Joint Inquiry confirmed through interviews that several other budget related problems hindered Intelligence Community efforts to satisfy counterterrorism priorities and requirements:

o The DCI's Community Management Staff has little authority to ensure compliance with the DCI's priorities. It cannot withhold funding from the Intelligence Community agencies if they do not comply with those priorities;

o Managers within the CIA often found the budget planning and execution process confusing, making it harder for them to articulate their needs; and

o Intelligence Community officials complained that reprogramming money is difficult due to a slow Congressional approval process for even small changes.

4. Finding: While technology remains one of this nation's greatest advantages, it has not been fully and most effectively applied in support of U.S. counterterrorism efforts. Persistent problems in this area included a lack of collaboration between Intelligence Community agencies, a reluctance to develop and implement new technical capabilities aggressively, the FBI's reliance on outdated and insufficient technical systems, and the absence of a central counterterrorism database.

Discussion: The Joint Inquiry confirmed that the Intelligence Community had not yet fully incorporated the benefits of technology in the war against terrorism. Lack of agency collaboration in the areas of technical collection and systems development was one contributing factor. While CIA and NSA have had many successful joint counterterrorism technical operations, the Inquiry was told that overlapping targets and greater use of similar technologies caused friction between the two agencies in some instances. Disputes emerged regarding which agency should be in charge of developing and using such technologies against which targets. The Director of NSA explained to the Joint Inquiry that "the old divisions of labor are impractical - the new electronic universe [page 58] requires more and more cooperation." He added that he "would not be surprised if someday the closeness of this relationship would require organizational changes."

In Joint Inquiry interviews, agency personnel stated that, while individual relationships and cooperation between CIA and NSA at the working level had often been very good, relationships at the mid- and upper-management levels of those agencies were often strained. CIA perceived NSA as wanting to control technology use and development, while NSA was concerned that CIA was engaged in operations that were NSA's responsibility.

As a result, significant agency resources were devoted to documenting authorities and responsibilities. For example, no less than seven executive-level memoranda (including one from the President) have been necessary to reach agreement and define the responsibilities and authorities of CIA and NSA in one counterterrorism effort. The agencies also established a Senior Partnership Advisory Group to continue to deal with these issues and CIA assigned several officers to NSA to enhance technology development.

Prior to September 11, the Director of NSA publicly acknowledged the challenge posed by Usama Bin Ladin's access to the modern communications technology developed by a three trillion dollar industry. Despite this recognition, NSA failed to focus its efforts against al-Qa'ida's use of certain forms of this technology, [ ]. NSA also had not adapted technology fully to the challenge of transnational threats such as terrorism. These present much different challenges than those posed by state actors, such as the former Soviet Union, that were NSA's primary targets in the 1980's. As a result, prior to September 11, NSA provided little counterterrorism intelligence from certain important technical sources. More critically, NSA has not been able to describe to the Joint Inquiry its plans to address this technical problem on a larger scale.

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Similarly, NSA could not demonstrate its current analytic tools to the Joint Inquiry and could not identify upgrades that will assist NSA analysts in identifying critical intelligence amidst the large volumes of information it collects. In the absence of such tools, NSA language analysts must still conduct the bulk of their work with pencil and paper. Many develop their own personal "databases" on index cards that cannot be made readily available to counterterrorism analysts at other agencies. NSA's highly publicized TRAILBLAZER program was often cited by NSA officials as the solution to many of these problems, but the implementation of those solutions is three to five years away and confusion still exists at NSA as to what will actually be provided by that program.

The FBI's Deputy Assistant Director for Counterterrorism Analysis testified to the Joint Inquiry that "one of the FBI's major deficiencies was that the FBI confronted a

variety of problems in sharing information, not only with other agencies but within the Bureau itself. This was and is largely attributable to inadequate information technology." Likewise, Director Mueller acknowledged to the Joint Inquiry that "[o]ver the years, [the FBI] failed to develop a sufficient capacity to collect, store, search, retrieve, analyze, and share information."

In their testimony, FBI field agents from Phoenix, Minneapolis and New York all cited the FBI's technology problems as among the top three things they would like to see addressed in terms of the counterterrorism effort. As a New York agent explained:

The technology, number one. The FBI is a member of the Intelligence Community. We have to be able to communicate with them. We have to be able to have databases that can be integrated with them, and right now we do not. It is a major problem. It is a major problem for our analysis.

The FBI deployed its Automated Case System (ACS) in 1995 to replace a system of written reports and indices. The ACS was supposed to enable agents to send leads to other FBI offices and units and to have access to a vast array of data electronically. [Page 60] However, study after study has concluded that ACS is limited in its search capacity, difficult to use, and unreliable.

The Chief of the FBI's Radical Fundamentalist Unit (RFU) testified that ACS remains unfriendly, unreliable and unworkable, and that, instead of using ACS to manage cases, many agents rely on e- mail and paper copies to transmit important data. In interviews, some FBI personnel conceded that "routine" leads, on which there were no automated communications, might have "fallen through the cracks." Despite the priority given to the war against terrorism since September 11, the Joint Inquiry heard testimony that, at least as of the end of September 26, 2002, there were still 68,000 outstanding, unassigned leads directed to the Counterterrorism Division, dating back to 1995. Because many FBI personnel did not use ACS to track outstanding leads, the FBI has been unable to determine how many of these leads have been completed. As the RFU Chief explained:

I think we need to make it very clear, though, because there is [sic] 68,000 leads outstanding on that point, that does not mean that those leads were not handled.... [E]ven though the lead is shown in the computer as not covered by the Counterterrorism Division, it is covered by the operational

unit. So there is a lot of duplication. . . .[T]he system is very cumbersome, and people unfortunately have just become very frustrated with it, to the point where . . . [w]hat will frequently happen, for example, is even though a field division sends a lead to headquarters and ACS, they are also e-mailing that communication to the particular FBI headquarters [supervisory special agent]. So they are getting it and working on it via the e-mail but not necessarily within the ACS system. . . . Even though a couple of years ago . . . there was a directive that went out to the field telling them to stop sending hard copies to headquarters because they should be retrieved electronically, it was well known, both in the field and at headquarters, that you wouldn't get the communication or there was a good chance that you weren't going to get it. As such, the field would routinely still send hard copy.

ACS requires that FBI analysts search for information relevant to their analytical responsibilities. This is in stark contrast to the CIA's automated system, which automatically routes communications to analysts that are relevant to their interests. Before September 11, 2001, many FBI field agents did not include sensitive information in ACS because they believed the system was not secure. In addition, many agents who did include information in ACS blocked access to it in order to limit the number of FBI [page 61] personnel who could obtain the information. Given hese limitations, ACS does not provide assured retrieval of complete, authoritative information on any subject. The fact that many FBI personnel do not understand how to make maximum use of the limited capabilities of ACS and the FBI's other databases compounds the problem.

Because of its limitations, many agents simply did not use ACS as a research or case management tool. When the Phoenix FBI field office agent was drafting his July 2001 Electronic Communication, he had no easy or reliable way of querying a central FBI system to determine whether there were other reports on radical fundamentalists taking flight training or whether other FBI field offices were investigating similar cases. As a result, the agent did not know that another FBI field office had voiced concern about Middle Eastern men taking flight lessons in 1998 or that an operational unit in the Counterterrorism Section at FBI Headquarters had directed twenty-four field offices (including Phoenix) to pay close attention to certain Islamic students engaged in aviation training in 1999.

In addition, because of the limitations of ACS, a number of addressees on the Phoenix communication, including the Chief of the FBI Headquarters Radical Fundamentalist Unit, were not aware of the communication before September 11. Further, even though that Unit handled both the Phoenix communication and the exchanges with the Minneapolis FBI field office in connection with the Moussaoui investigation, no one connected the two matters. Likewise, the Minneapolis FBI field office agents investigating Moussaoui had no reliable way of determining whether there was information in FBI files about threats to aviation or terrorist plots to hijack planes and, therefore, did not know about the Phoenix communication and other concerns about Middle Eastern men taking flight lessons.

While ACS and most other FBI databases are classified at the Secret level, a large percentage of the information disseminated throughout the Intelligence Community is classified Top Secret and, therefore, cannot be maintained on ACS. The information is instead maintained on a separate database to which FBI counterterrorism personnel do [page 62] not have access at their desks. Further, the CIA places human intelligence information in a special compartment at the Secret level and that information also cannot be shared within the FBI's databases.

The Chief of the FBI's Radical Fundamentalist Unit described the FBI's situation in September 24, 2002 testimony to the Joint Inquiry:

. . . [C]ommunications coming into our building from NSA, from CIA cannot be integrated into our existing databases. So if an analyst is working, say, on a subject in Phoenix division and they run that person's name through our databases, they will not retrieve information on that person that other agencies may also have. It is required of them to get up, walk over to a different set of--or a different computer that has access to a different database and search that name in that database; and the two databases will never come together and be integrated. So it is a setup for failure in terms of keeping a strategic picture of what we are up against.

Although some FBI personnel have access to separate Top Secret Intelligence Community networks, the FBI's computer systems are not linked to Intelligence Community systems or even to the Department of Justice.

5. Finding: Prior to September 11, the Intelligence Community's understanding of al-Qa'ida was hampered by insufficient analytic focus and quality, particularly in terms of strategic analysis. Analysis and analysts were not always used effectively because of the perception in some quarters of the Intelligence Community that they were less important to agency counterterrorism missions than were operations personnel. The quality of counterterrorism analysis was inconsistent, and many analysts were inexperienced, unqualified, under-trained, and without access to critical information. As a result, there was a dearth of creative, aggressive analysis targeting Bin Ladin and a persistent inability to comprehend the collective significance of individual pieces of intelligence. These analytic deficiencies seriously undercut the ability of U.S. policymakers to understand the full nature of the threat, and to make fully informed decisions.

Discussion: Despite the recognition of the increased threat posed to the United States by al-Qa'ida, the U.S. Intelligence Community's analytic focus on al-Qa'ida was woefully inadequate prior to the September 11 attacks. At the CTC, for example, there were only three analysts assigned to work on al-Qa'ida full time between 1998 and 2000, [page 63] and five between 2000 and September 11, 2001. Including analysts from elsewhere in CIA who were in some part attentive to al-Qa'ida, the total was fewer than forty.

[In terms of "work years," the equivalent of nine analyst work years was expended on al-Qa'ida within CTC's Assessments and Information Group in September 1998. According to CIA, nine CTC analysts and eight analysts in the Directorate of Intelligence were assigned to UBL in 1999. This was only a fraction of the analytic effort that was to be devoted to al-Qa'ida in July 2002].

DCI Tenet acknowledged at the June 19, 2002 Joint Inquiry hearing that:

I think that is correct. I think [the number of analysts in the CTC analytic unit working on Usama Bin Ladin and al-Qa'ida] was too small. . . . I think one of the things I would say is from a strategic analytical perspective we should have had more analysts than we did. . . .

[At the FBI, there were fewer than ten tactical analysts and only one strategic analyst assigned to al-Qa'ida prior to September 11, 2001. The NSA had only a limited number of Arabic linguists, on whom analysis depends, and, prior to September 11, few were dedicated full-time to targeting al- Qa'ida. At the time, NSA's Arabic linguists were

also being used to support other high priority targets in the region and to translate intelligence originating in the region and elsewhere].

Elsewhere in the Intelligence Community, other agencies dedicated varying numbers of analysts to the al-Qa'ida issue prior to September 11, 2001. The other two primary all-source analysis centers, DIA's Joint Intelligence Task Force, Combating Terrorism, and State Department's Bureau of Intelligence Research (INR) focused on anti-terrorism and force protection analysis to protect overseas equities. INR dedicated one analyst solely to al Qa'ida, and, at Secretary of State direction, provided a daily summary of intelligence relating to Usama bin Ladin and his activities. DIA devoted 30 analysts to Sunni Extremism and, on any given day, several of them - augmented by Reservists - would be involved with Usama bin Ladin-related issues.

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Other agencies and organizations maintained at least an awareness of al-Qa'ida and performed roles such as financial tracking and training camp observation consistent with their charters. One non- Intelligence Community organization, the FAA, dedicated as many as five analysts at any one time to al Qa'ida. In late 2000, according to FAA officials, FAA offered CTC Chief Cofer Black the support of its nearly two-dozen analysts regarding transportation security issues in exchange for broader information sharing, but this offer was not accepted because of CTC concerns about protecting its sources and methods. The Joint Inquiry was told that a similar offer of analytic support was made to CTC Chief Black by DIA in 2000, but with similar results. FAA and DIA are both represented at CTC.

The Intelligence Community's focus was also far more oriented toward tactical analysis of al- a'ida in support of operations than on the strategic analysis needed to develop a broader understanding of the threat and the organization. For example, as mentioned earlier, the DCI's National Intelligence Council never produced a National Intelligence Estimate (NIE) on the threat to the United States posed by al-Qa'ida and Usama Bin Ladin. Active analytic efforts to identify the scope and nature of the threat, particularly in the domestic United States, were clearly inadequate.

As noted in an August 2001 CIA Inspector General report, analysts assigned to CTC only had time to focus on crises or short-term demands, and "did not have the time to spot trends or to knit together the threads from the flood of information." These shortcomings, unfortunately, had an impact on areas that were directly relevant to the September 11 attacks. The Joint Inquiry record confirms, for example, that the Intelligence Community had devoted little or no analytic focus prior to September 11 to the terrorist use of aircraft as weapons or to the significant role in al-Qa'ida that was played by Khalid Shaykh Mohammed.

This review also confirms that the FBI was performing little, if any, strategic analysis against al- Qa'ida prior to the September 11 attacks. The Chief of the FBI's National Security Intelligence Section testified that the FBI had "no analysts" dedicated [page 65] to strategic analysis prior to September 11. In fact, as of that date, the FBI had only one strategic analyst working on al-Qa'ida matters. FBI Assistant Director for Counterterrorism Dale Watson testified that he could not recall any instance where the FBI Headquarters terrorism analytical unit produced "an actual product that helped out."

When the FBI did complete analytic products, the quality was inadequate. During the summer of 2001, the U.S. Intelligence Community was in a state of heightened alert, due to concern about an imminent al-Qa'ida attack. However, this concern was not reflected in the FBI's National Law Enforcement Threat System (NLETS) reports, which are the means through which the FBI communicated terrorist threat information with state and local law enforcement entities. In a May 2001 NLETS report, for example, the FBI assessed the risk of terrorism as "low," and, in a July 2, 2001 NLETS report, stated that the FBI had no information indicating a credible threat of terrorist attack in the United States, although the possibility of such an attack could not be discounted. Additional FBI notices that were issued later in July 2001 indicated that there was a potential for attacks against U.S. interests abroad, but again that the possibility of an attack in the United States could not be discounted.

More focus on strategic analysis by the FBI and the CIA would have helped crystallize the threat, particularly within the United States, and perhaps spurred more immediate defensive action by U.S. Government policymakers. The Intelligence

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