Feds Crushed Telecom CEO Who Protected Customer Data from NSA Snoops…But He’s Back, Protesting New Reform Law


Long before 9/11 in 2001 or the reformist surveillance law signed last month, one of the nation’s top telecom executives reminded federal officials they needed court approval before his company could hand over en masse private customer data to the National Security Agency (NSA).

Joseph P. NacchioQwest Chairman and CEO Joseph P. Nacchio, shown at right, thus followed traditional business and legal principles regarding government requests for electronic data. He chaired two national telecom advisory commissions under the then-new Bush administration after 26 years with AT&T. So, he was an expert even though Qwest (a fiber company that acquired US West) was best known in the Western states it primarily served as one of the nation's four regional Bell carriers during that era.

But Nacchio then endured a long nightmare of reprisal that is relevant to the supposed protections of the USA Freedom Act signed last month.

President Obama and other backers of the new law say it protects the public by keeping data with private companies except upon valid request from authorities.

That protection is questionable in the real world, however, especially after the reported compliance of all major telecom CEOs in 2001 except Nacchio to the NSA warrantless requests -- and the brutal, little-known reprisal against Nacchio, the holdout.

Nacchio will speak of these factors July 29 10 a.m. at the National Press Club and then at a 4 p.m. panel on political prosecutions as a threat to democracy at the Whistle Blowers Summit in Washington, DC.

Authorities cancelled hundreds of millions of dollars in contracts for Qwest to provide services for federal agencies. The company’s stock price spiraled down from $38 to $2 amid the general decline in telecom in 2001 and factors specific to Qwest.

NSA Official LogoEven worse for Nacchio, he then received a six-year prison sentence on questionable federal convictions for his sales during a trading window in April 2001. His prison term came with a $19 million fine and an additional $44 million in forfeiture penalties.

The punishment appears to have been reprisal via a political prosecution of a kind rare in U.S. securities law history. Today's column focuses primarily on Nacchio's perspective on the viability of the USA Freedom Act. Details of his court cases are for another day except for a brief overview:

Authorities convicted Nacchio of insider trading for selling stock during April 2001, a designated window when he was permitted by the company to sell stock. This followed internal discussions that Qwest (later acquired by CenturyLink in 2011) had income that would not continue.

Nacchio has unsuccessfully argued in filings extending to the U.S. Supreme Court that CEOs frequently hear both good and bad internal predictions that do not arise to "material" information whose disclosure to the stock-trading public is required to avoid liability under securities law. Thus, he argued, he remained optimistic about the company's prospects and forbade his broker from selling his shares if prices dipped below $38. The U.S. Chamber of Commerce, among others, endorsed his legal position in briefs to the Supreme Court in Nacchio v. United States.

An additional obstacle for him, as for other litigants protesting "political" prosecution when authorities ignore similar acts, is that legal rules prevented Nacchio from arguing during his criminal case that he had been the victim of "selective" prosecution. But he did argue reprisal more recently in tax litigation before the U.S. Court of Claims.

During the criminal trial, Chief U.S. District Judge George Nottingham of Denver made many pro-prosecution rulings.

Former U.S. District Judge Edward NottinghamAs it turned out, the married judge was also hiding a secret sex scandal. This raises the additional question -- relevant to ordinary citizens also who might have reason to fear electronic surveillance -- of whether the married judge was under pressure from his shame of being a big spender on prostitutes and strippers.

Whatever the answer on that, Nottingham (shown in a file photo and now off the bench in disgrace after his wife blew the whistle) denied Nacchio some basic fair trial safeguards.

For example, Nottingham forbade University of Chicago law professor Daniel Fischel, Nacchio’s main defense witness, from testifying about industry-wide norms for CEOs handling confidential information and trading shares. Stock was Nacchio’s main form of compensation following his three decades in telecom. A divided appellate court later sustained Nottingham's ruling.

Although a jury is supposed to be neutral, Nacchio faced also a popularity problem in Qwest's home region because the savings of many retirees were locked into a pension plan. Nonetheless, many telecom companies went bankrupt outright during "The Tech Wreck" of 2001 on the stock market and only a few of their CEOs were indicted for making optimistic comments typical for the job.

Here and Now

If there’s ever a time to use a cliché once again this seems like it:

Nacchio was down, but not out after retaining enough funds so as to be able to tell one interviewer that he remains "well off."

Next week, he returns to the nation’s capital for two hard-hitting presentations attacking the reform law.

First, the National Press Club hosts Nacchio at 10 a.m. in its “Newsmaker” series. The club moderator will be journalist Michael Smith, who previewed the session for the club’s announcement under the headline, “Will NSA Surveillance Reform Protect Public?”

The preview said: 

Nacchio, the leader of the regional Bell provider for 14 Western states, plans to argue that one of the greatest threats to American freedom comes from the U.S. government. Government surveillance that violates the Constitution’s Fourth Amendment “chills” free speech under the First Amendment, he says. Also, he argues that America faces over-criminalization of its justice system and inappropriate political criteria used to determine which targets to prosecute.

Nacchio holds a rare position to comment, particularly on the surveillance reforms in the new law that positions private companies as a protector of customer data from potential government over-reach. Details.  

Whistle Blower Summit 2015Next, Nacchio receives at 4 p.m. a “Pillar Corporate Courage Human Rights Award" at the annual Whistle Blowers Summit on Capitol Hill. The conference organizers called them "Pillar Awards" because our democracy is based on individual pillars who uphold democracy.

Nacchio then joins the panel "Political Prosecutions and the Danger to Democracy" with two other speakers who share first-hand experiences fighting injustice on issues of historic importance. They are:

•    Abraham Bolden, 80, (speaking via Skype because of his age), was recruited by President John F. Kennedy to become the first African American Secret Service officer guarding a president. In Bolden’s memoir The Echo from Dealey Plaza, he alleged gross Secret Service misconduct. His exposé raises timely concerns whether the public gets the real story about Secret Service presidential protection, whether of JFK, President Obama, or the score of declared 2016 now meeting voters on the campaign trail. Details.

•    Former HealthSouth founder/CEO Richard Scrushy, co-defendant with former Alabama Gov. Don Siegelman in one of the most widely condemned federal prosecutions in recent U.S. history. Scrushy, president/CEO of the consultancy 7venth Power, last year published, When Building A Billion Dollar Company and is motivational speaker who will advise reformers and litigants on coping with the legal hardships that many whistleblowers must endure. His ordeal shares many commonalities with Nacchio’s and thus should alarm anyone who trusts the legal system to provide fair outcomes in political sensitive matters, criminal or civil. Details.  

This editor is the panel moderator and organizer. The Justice Integrity Project for years has published extensively about these men, their cases, and the historical importance. These matters will be treated also in the forthcoming book providing necessary context to the 2016 elections, Presidential Puppetry 2016.

NSA reform report 2013 cover, Richard A. Clarke. Michael J. Morell. Geoffrey R. Stone. Cass R. Sunstein. Peter SwireFurther, we have met and heard four of the five members of the president's NSA reform commission whose cover is portrayed at right, and many of the prominent former NSA executives who oppose its recommendations as too flimsy to protect the public's rights.

Regarding protections of Fourth Amendment and other constitutional rights, the prominent whistleblowers and former NSA senior executives William Binney and Thomas Drake are among the speakers at the Summit on panels July 29 and 30.

Anticipating Nacchio's arguments, both Binney and Drake were quoted this spring as saying the new law would not prevent the NSA from warrantless electronic surveillance. U.S. News and World Report writer Steven Nelson summarized their views in NSA Whistleblowers Oppose Freedom Act, Endorse Long-Shot Bill. Much longer amplifications of their views are excepted in selected articles below, including our overview of NSA operations published in 2013 following Edward Snowden's revelations.

On July 29, free registration for the Summit begins at 9 a.m. at the Stewart Mott House, 122 Maryland Ave, NE. The events convene a broad spectrum of whistleblowers and supporters from the realms of national security, USDA, law enforcement, non-profits, financial sectors, military, and veterans affairs. Click here for details.

Nacchio speaks also at a 10 a.m. news conference and Scrushy at a 6:30 p.m. dinner, both at the National Press Club, 529 14th St., NW. The Dutch-treat dinner organized by the McClendon Group speaker society is open to the public.

Looking ahead, the Project will explore in coming days new dimensions of parallel prosecution and judicial  misconduct in the Nacchio and Scrushy cases.

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About Joseph Nacchio

Joseph  Nacchio at NPCJoseph P. Nacchio, former chairman/CEO of Qwest Communications, at July 29 Newsmaker on NSA reform. Mike Smith (seated) of the Newsmakers Committee moderated the event. Photo/Image: Noel St. John.

National Press Club, Nacchio, at NPC Newsmaker, warns of NSA overreach on phone records, Mike Smith, Aug. 2, 2015. Joseph P. Nacchio, the former chairman and CEO of Qwest Communications International and convicted felon on insider trading who spent 72 months in federal prison (and forfeited $62 million), warned that the newly passed USA Freedom Act doesn't go far enough to rein in National Security Agency scrutiny of Americans’ digital and phone records. At a July 29 National Press Club Newsmaker, Nacchio, the Brooklyn-born son of a longshoreman who earned an MBA from New York University and a master’s in engineering from MIT, charged that the USA Freedom Act does not adequately reform the Patriot Act. The Patriot Act was ruled unlawful by an Appeals Court in May, 2015. On June 2, Congress passed the USA Freedom Act just hours before all surveillance authority was stripped from NSA and other intelligence-gathering agencies. The new law provides limits on bulk collection of phone records.

Joseph P. Nacchio is the former Chairman and Chief Executive officer of Qwest Communications International and former Chairman of the National Security Telecommunications Advisory Committee.

His career in the telecommunications industry began at AT&T, where he worked for 26 years and rose to the positions of both President of Business and Consumer Communication Services.

He left AT&T in 1997 to become the Chief Executive Officer of Qwest Communications International. In 1999 he also assumed the responsibility of Chairman of the Board of Qwest, a position he held until June 2002. In 2001, he was appointed by President George W. Bush to be Chairman of the National Security Telecommunications Advisory Committee. Also in 2001, he was asked by former FCC Chairman, Michael Powell, to Chair the Network Reliability and Interoperability Committee.

He has most recently addressed concerns about unlawful surveillance, the over criminalization of life in America and the widespread abuses in our criminal justice system on CNBC, CBS News, Fox Business News, the Glen Beck Show, the Wall Street Journal, and the New York University School of Business. He is an advocate for criminal justice reform, protecting the Fourth Amendment in the digital age, and prison reform. Also, he is writing a book about these same concerns and his personal experience with the judicial and federal prison systems. He holds degrees from both New York University and the Massachusetts Institute of Technology.

National Press Club, Will NSA Surveillance Reform Protect Public? Michael Smith, July 29, 2015. Joseph P. Nacchio, the former chairman/CEO of Qwest Communications International and of two national commissions on security and infrastructure, will speak at a National Press Club Newsmaker news conference on Wednesday, July 29 – to explain why he believes the USA Freedom Act signed into law last month provides inadequate protection against National Security Agency’s (NSA) bulk data collection of the public’s electronic communications. Nacchio, the leader of the regional Bell provider for 14 Western states, plans to argue that one of the greatest threats to American freedom comes from the U.S. government. Government surveillance that violates the Constitution’s Fourth Amendment “chills” free speech under the First Amendment, he says. Also, he argues that America faces over-criminalization of its justice system and inappropriate political criteria used to determine which targets to prosecute. Nacchio holds a rare position to comment, particularly on the surveillance reforms in the new law that positions private companies as a protector of customer data from potential government over-reach. In early 2001 before 9/11, Nacchio declined the Bush administration’s request to cooperate in the warrantless monitoring of customer data. Although many details remain classified, he has been widely reported as the only top telecom executive to demand a court order or approval under the Foreign Intelligence Surveillance Act to turn over records to the NSA.

Salt Lake Tribune, Ex-Qwest CEO: Likely the NSA snatched emails, calls during Salt Lake Olympics, Thomas Burr, July 29, 2015. Eavesdropping: The feds “would have been crazy” not to monitor emails and texts just months after 9/11, he said. The former head of Qwest Communications says it's likely that the National Security Agency and the FBI monitored all email and text communications in the Salt Lake City area during the 2002 Winter Olympics but says he can't confirm whether his company helped intercept the communications. Joseph Nacchio headed Denver-based Qwest from 1997 to 2002 and later served more than four years in prison on insider-trading convictions involving the telecom giant. He said Wednesday that he couldn't say whether the company worked with the NSA or FBI to capture such information during the Olympics, but that the agencies could have worked with other executives to gain access without his knowledge. "I don't remember being contacted about that, but then I may not have had the need to know," Nacchio said after a speech at the National Press Club on the civil-rights threat of government surveillance. "I would be real surprised in 2002 if it didn't happen," Nacchio added, noting later, "They would have been crazy not to do it." Nacchio said Wednesday if he had been presented with a court order, he probably would have provided records to the NSA at the time.

A top-secret NSA inspector general's report from 2009 — leaked to The Guardian newspaper by former NSA contractor Edward Snowden — detailed an agreement between the spy agency and "Company E," thought to be Qwest Communications, to "provide call detail records ... in support of security for the 2002 Olympics in Salt Lake City." Additionally, The Wall Street Journal reported in 2013 that the NSA and FBI monitored communications in the Salt Lake City area "for a period of less than six months" surrounding the Winter Games. The international sporting event was held less than six months after the Sept. 11, 2001, terrorist attacks and prompted a higher security level.

Communities Digital News, Whistle Blower Summit: Nacchio & Scrushy fight the government...and lose, Michael Volpe, Aug. 12, 2015. Joseph Nacchio and Richard Scrushy were both once CEOs of major corporations. They spoke out. The lesson learned: When the government wants to get you, it will get you.

Joe Nacchio with Rick Sallinger of CBS (CBS Photo)CBS News4 (Denver) Defiant Joe Nacchio Lashes Out Against Those Who Sent Him To Prison, Staff report, May 28, 2014. Former Qwest CEO Joe Nacchio lashed out at those who put him in federal prison for insider trading in a rare interview. Nacchio, who was released after serving 4 1/2 years and paying millions of dollars in restitution, spoke near his home in Florida with CBS4’s Rick Sallinger. It is the only interview Nacchio has granted with a Colorado reporter to date since his time behind bars. Nacchio showed no remorse in the interview and explained why he now has a shaved head and goatee. “I was a political prisoner. I figured I ought to look like one,” he told Sallinger. Nacchio says he now has clearance to talk about the defense that he couldn’t use at his trial. He says his refusal to cooperate with a National Security Agency surveillance project is what led to his downfall. Nacchio predicted a bright future for Qwest when he was CEO of the Colorado-based telecommunications company. But its stock crashed in 2001.

Photo of Nacchio, left, and Rick Sallinger by CBS News4 in Denver.

Sallinger commented to Nacchio at one point during the interview that “It doesn’t seem that there will be any apology.”

Troy Eid“There’s nothing to apologize (for) Rick,” Nacchio said. “The people say to me ‘Why don’t you apologize?’ What am I apologizing for? Not breaking the law?”

Nacchio was convicted on 19 counts of insider trading. “He took a lot of money that he shouldn’t have taken and he needs to own up for it,” former U.S. attorney Troy Eid (shown at right). Nacchio believes responsibility lies with the federal government. It goes back to a 2001 meeting, he says, at NSA headquarters near Washington. “I refused to allow Qwest to participate or personally participate in what I believe was an illegal surveillance activity,” he said. Declassified documents marked SECRET hint of big government projects on which Nacchio says Qwest was then blackballed. The court ruled he was not allowed to use that information in his defense “Did you want to testify?” Sallinger asked Nacchio. “Absolutely. But here is what I wasn’t willing to do. I wasn’t willing to testify with one arm behind my back. In other words, I wasn’t willing to testify only to things the government was going to allow me to testify about,” he said.


White House Statement on USA Freedom Act

C-SPAN, Government Surveillance Programs, Senate Judiciary Committee Chairman Pat Leahy (D-VT) presiding, Jan. 14, 2014. Members of the President Obama’s Review Group on Intelligence and Communications Technologies testified on their recommendations to modify National Security Agency (NSA) surveillance programs. They were: Richard A. Clarke. Michael J. Morell. Geoffrey R. Stone. Cass R. Sunstein. Peter Swire. They said that the programs did not have a significant effect on stopping terrorist attacks, and recommended taking certain information from NSA control.

Barack Obama and James Clapper (White House Photo)President Obama is shown in a file photo meeting with Director of National Intelligence James Clapper in 2014.

White House, Statement by President Obama on the USA FREEDOM Act, June 02, 2015. For the past eighteen months, I have called for reforms that better safeguard the privacy and civil liberties of the American people while ensuring our national security officials retain tools important to keeping Americans safe.  That is why, today, I welcome the Senate’s passage of the USA FREEDOM Act, which I will sign when it reaches my desk. After a needless delay and inexcusable lapse in important national security authorities, my Administration will work expeditiously to ensure our national security professionals again have the full set of vital tools they need to continue protecting the country. Just as important, enactment of this legislation will strengthen civil liberty safeguards and provide greater public confidence in these programs, including by prohibiting bulk collection through the use of Section 215, FISA pen registers, and National Security Letters and by providing the American people with additional transparency measures.


Related NSA / Surveillance News Coverage

Selected Key Nacchio Court Cases

U.S. Supreme Court 
Title: Nacchio v. United States, Docket: 08-1172

Issue: Whether the district court correctly instructed the jury on materiality, whether the district court properly excluded the testimony of a witness under Fed. R. Evid. 702, and whether there was sufficient evidence to support the jury’s finding that the defendant knowingly failed to disclose material information on insider trading.  

•    Opinion below (10th Circuit)
•    Petition for certiorari
•    Brief in opposition
•    Petitioner's reply
•    Brief amicus curiae of National Association of Criminal Defense Lawyers (in support of petitioner)
•    Brief amicus curiae of Washington Legal Foundation (in support of petitioner)  
•    Brief amicus curiae of Chamber of Commerce (in support of petitioner)

SCOTUSblog, Analysis: New approach to “insider” gains, Lyle Denniston, Aug. 11, 2009. A major dispute over how severely to punish a corporate “insider” who makes gains from trading in the company’s stock with information other investors don’t have seemed a likely bet for Supreme Court review. But that won’t happen now: the Justice Department has decided not to test the question further, after losing on it recently in the Tenth Circuit Court. In a direct conflict with the Eighth Circuit Court, the Tenth Circuit on July 31 adopted a new theory on stock market activity that can have the effect of sharply reducing the amount of money an executive made on “insider” transactions, leading to a required lowering of the criminal sentence for conviction of that crime.  The Tenth Circuit ruled in the case of a former telecom tycoon, Qwest’s former CEO, Joseph P. Nacchio. ( The ruling can be found here.)

Also, Court of Federal Claims No. 12-20T, Joseph Nacchio and Anne Esker v. US, March 12, 2014. Commentary:

Law 360, Ex-Qwest CEO Can Pursue $18M Tax Refund Tied To Tips, Matthew Villmer, March 14, 2014. A federal court said Wednesday that Qwest Communications International Inc.’s former CEO can seek almost $18 million in tax refunds after he forfeited millions in proceeds from stock sales as part of a criminal conviction for insider trading. U.S. Court of Federal Claims Judge Mary E. Williams blasted the Internal Revenue Service’s argument that Joseph Nacchio was not entitled to a tax refund because his losses were traceable to insider trading, saying public policy has nothing to do with an analysis of the law surrounding tax refunds.

“[T]he government seeks to tax these proceeds not on the ground that they are income, but on an amorphous notion that the public policy against securities fraud must prevent the deductibility of monies that were received due to insider trading even though the monies were disgorged,” Williams wrote. “Applying public policy to preclude a deduction here would not comport with precedent.”
But to get his refund, Nacchio will now need to prove to a trial court that he subjectively believed he had a claim of right to the stock gain he later forfeited in the criminal case.  The case began in April 2007, when a federal jury convicted Nacchio of 19 of 42 insider trading charges, but acquitted him on the other 23 counts stemming from other stock sales. The jury returned its verdict following 15 days of trial and six days of deliberation. Then one month later, Nacchio was sentenced to six years in prison and forced to pay a fine of $19 million as well as forfeit the $52 million profit he had amassed in illegal stock sales. But when it came time to file his 2007 tax returns, Nacchio claimed the disgorgement of his stock gains resulted in a loss, giving him an $18 million credit.
The IRS denied the claim, and Nacchio sued. But on cross motions for summary judgment on the issue of whether Nacchio was entitled to the refund, Judge Williams sided with Nacchio on the legality of the claim.

Joseph Nacchio is represented by William D. Lipkind and Thomas A. Gentile with Lampf Lipkind Prupis & Petigrow PC. The case is Joseph Nacchio v. The United States, case number 12-20T, before the U.S. Court of Federal Claims.



Surveillance, the NSA, Privacy, and Qwest's Joseph Nacchio

Update: Politico, NSA bulk phone snooping program shuts down, Alex Byers, Nov. 27, 2015. The National Security Agency will no longer be able to collect phone records in bulk starting Nov. 29, the Office of the Director of National Intelligence said in a statement Friday. The program's closure was required by the USA Freedom Act, signed by President Barack Obama in early June. The program was allowed to continue since then as part of a six-month wind-down period, in which intelligence officials could create and test a new phone records program where the government can only obtain records connected to a specific entity like a person or device that is associated with a foreign power or terrorist group.

Some Senate Republicans, led by Sen. Tom Cotton (Ark.) and 2016 presidential candidate Sen. Marco Rubio (Fla.), tried to delay the program's official end this month in the wake of the Paris terrorist attacks. But despite support from Senate Majority Leader Mitch McConnell, the effort got no traction in Congress.  The NSA has requested that some officials continue to have access to data already collected by the agency for "technical" purposes -- but not intelligence analysis- for another three months, according to ODNI. The Foreign Intelligence Surveillance Court is currently reviewing that request, ODNI said. A federal court issued an order earlier this month holding the program unconstitutional and barring the collection of phone metadata pertaining to one California attorney and his law practice. However, after authorities argued that implementing the order would require the early shutdown of the whole program, a federal appeals court stayed the ruling.

OpEdNews, The Dying Institutions Of Western Civilization, Paul Craig Roberts (shown in a file photo), Aug. 31, 2015. The United States no longer has a judiciary. This former branch of government has transitioned into an enabler of executive branch fascism. Dr. Paul Craig RobertsPrivacy is a civil liberty protected by the U.S. Constitution. Recently a three-judge panel of the U.S. Appeals Court for the District of Columbia ruled that the National Security Agency can continue its mass surveillance of the US population without showing cause. The panel avoided the constitutional question by ruling on procedural terms that NSA had a right to withhold the information that would prove the plaintiffs' case. By refusing to extend the section of the USA PATRIOT Act -- a name that puts a patriotic sheen on Orwellian totalitarianism -- that gave carte blanche to the NSA. And by passing the USA Freedom Act, Congress attempted to give NSA's spying a constitutional patina. The USA Freedom Act allows the telecom companies to spy on us and collect all of our communications data and for NSA to access the data by obtaining a warrant from the Foreign Intelligence Surveillance Act (FISA) Court. The Freedom Act protects constitutional procedures by requiring NSA to go through the motions, but it does not prevent telecom companies from invading our privacy in behalf of NSA.

No one has ever explained the supposed threat that American citizens pose to themselves that requires all of their communications to be collected and stored by Big Brother. If the US Constitution was respected by the executive branch, Congress, the judiciary, law schools and bar associations, there would have been a public discussion about whether Americans are most threatened by the supposed threat that requires universal surveillance or by the loss of their constitutional protections.

Tampa Bay Times, Why did the FBI detain Bob Graham?  Lucy Morgan, August 7, 2015. Going to lunch with former U.S. Sen. Bob Graham can be hazardous to retirement. And extremely interesting. He told us Bob Graham with Keys to the Kingdomabout the day in 2011 when he and Adele were heading to the Washington, D.C., area to spend Thanksgiving with one of their daughters. As they stepped off an airplane at Dulles International Airport, two FBI agents approached and asked the Grahams to accompany them to a nearby agency office. Graham had not informed the FBI that he was traveling to the Washington area and to this day does not know how they knew where he planned to spend Thanksgiving or what airplane he would be aboard. A little scary huh? Perhaps his phone is on the NSA's list.

Editor's note: In a photo by the Justice Integrity Project taken at the National Press Club, Graham is shown with his novel Keys to the Kingdom —  which portrays in semi-fictional form his understanding of how entities affiliated with the Kingdom of Saudi Arabia funded 9/11 attackers, whose role has been suppressed by authorities. Although Graham was chairman of the Senate Intelligence Committee and co-authored its 2003 report on the attack he and other elected representatives supposedly providing oversight to the powerful U.S. intelligence community face imprisonment if they tell the public what they know, except in circumstances carefully controlled by the intelligence agencies themselves.

OpEdNews, Whistleblower Reveals AT&T/NSA Unholy Alliance, Joan Brunwasser, Aug. 25, 2015. Interview with noted AT&T whistleblower Mark Klein (shown in Klein family photo) on warrantless surveillance of AT&T customers.

Mark Klein (Klein family photo courtesy of DRM)Brunwasser: What you've just said raises so many questions; where shall I start? How did NSA go from their illegal domestic spying in the '70s to this? I don't get it. Wasn't what was once illegal still illegal?

Klein: There's two facets to the change from the '70s, one political and the other technological. Technologically, there has been a giant qualitative leap in surveillance capability because of the development of really fast computers, coupled with fiber optic cables that can carry huge amounts of data in just a few seconds, and the internet which reaches into every home. Couple that with the leap in storage technology, and you have the makings of a police state. Back in the '60s, for instance, when the FBI wanted to do surveillance on someone (e.g., Martin Luther King), it was very slow and labor intensive--you had to assign agents to tap into phone lines and record with old-fashioned tape recorders. It took a lot of time and effort, and so perhaps only a few hundred people could be spied on at once. Now, with the internet, it's all been automated with computers, which can sweep up the communications of millions of people automatically, and then the data can be searched by an agent using a keyboard.

USA Today, Senate approves USA Freedom Act, Erin Kelly, June 2, 2015. The Senate overwhelmingly voted Tuesday to end the National Security Agency's controversial bulk collection of the phone data of millions of Americans who have no ties to terrorism. Senators by a 67 to 32 margin approved the USA Freedom Act, which was passed by the House last month. President Obama signed the bill Tuesday night.

AP via Huffington Post, NSA Will Stop Looking At Old Phone Records, July 27, 2015. The Obama administration has decided that the National Security Agency will soon stop using Edward Snowdenmillions of American calling records it collected under a controversial program leaked by former agency contractor Edward Snowden (shown in photo). Congress passed a law earlier this year ending the NSA's bulk collection of American calling records after a six-month transition, but officials weren't sure what they would do about records going back five years that are currently being stored. The Director of National Intelligence said Monday that as of Nov. 29, those records would no longer be examined in terrorism investigations, and would be destroyed as soon as possible. The statement said that pending lawsuits prohibit immediate destruction of the records.

American Civil Liberties Union, End Mass Surveillance Under the Patriot Act, Staff report, June 2015. Just 45 days after the attacks of September 11, 2001, a panicked Congress passed, with virtually no debate, the USA Patriot Act. The law amounted to an overnight revision of the nation's surveillance laws that vastly expanded the government's authority to spy on its own citizens, while simultaneously reducing checks and balances on those powers. For years, we had little official information about how the government interpreted the overly broad surveillance bill. On June 6, 2013, the first of Edward Snowden's disclosures confirmed what some privacy advocates had long feared: Under Section 215 of the Patriot Act, the U.S. government collects, on a daily basis, the phone records of millions of Americans. These records include the numbers dialed and received, the dates and times of those calls, and their duration. That program was ruled unlawful by an appeals court in May 2015. Section 215 is one of the three sections of the Patriot Act that are scheduled to sunset on June 1, 2015. This long-abused provision of the law has been a failure by nearly every measure. The author of the law has publicly stated that it was never intended to facilitate mass, suspicionless surveillance. It has not played an essential role in stopping any attack. And it has enabled an unprecedented surveillance superstructure that violates Americans' rights to privacy, free speech, and free association.

First Look / Intercept, USA Freedom Act: Small Step for Post-Snowden Reform, Giant Leap for Congress, Dan Froomkin, June 2, 2015. Exactly two years after journalists Glenn Greenwald and Laura Poitras traveled to Hong Kong to meet an NSA whistleblower named Edward Snowden, Congress has finally brought itself to reform one surveillance program out of the multitude he revealed — a program so blatantly out of line that its end was a foregone conclusion as soon as it was exposed. The USA Freedom Act passed the House in an overwhelming, bipartisan vote three weeks ago. After hardliner Republicans lost a prolonged game of legislative chicken, the Senate gave its approval Tuesday afternoon as well, by a 67 to 32 margin. The bill officially ends 14 years of unprecedented bulk collection of domestic phone records by the NSA, replacing it with a program that requires the government to make specific requests to the phone companies.

After Snowden’s leak of NSA documents revealed it, the program was repeatedly found to violate the law, first by legal experts and blue-ribbon panels, and just last month by a federal appellate court. Its rejection by Congress is hardly a radical act — it simply reasserts the meaning of the word “relevant” (the language of the statute) as distinct from “everything” (how the government interpreted it). At the same time, the Freedom Act explicitly reauthorizes — or, rather, reinstates, since they technically expired at midnight May 31 — other programs involving the collection of business records that the Bush and Obama administrations claimed were authorized by Section 215 of the Patriot Act. In fact, even the bulk collection of phone records, which was abruptly wound down last week in anticipation of a possible expiration, may wind up again, because the Freedom Act allows it to continue for a six-month transition period. And while the Freedom Act contains a few other modest reform provisions‚ such as more disclosure and a public advocate for the secretive Foreign Intelligence Surveillance Court, it does absolutely nothing to restrain the vast majority of the intrusive surveillance revealed by Snowden.

C-SPAN Book TV, James Bamford on NSA Spying and Edward Snowden, Created Feb. 3, 2014 based on filming Jan. 15 at National Press Club. (78 min.) Author James Bamford, who has written three books James Bamfordabout the National Security Agency (NSA), talked about the history of NSA spying and the NSA’s surveillance of American citizens since the September 11, 2011 attacks. He also talked about NSA whistleblower Edward Snowden and the lawsuit brought against the agency by the Electronic Frontier Foundation.This event was being held at the National Press Club in Washington, DC. Bamford is the author of The Puzzle Palace, the first book published about the NSA. He later authored two more: Body of Secrets and The Shadow Factory. Bamford (shown in a file photo) has also written and co-produced a documentary on the NSA titled, The Spy Factory.

William Binney

USA Today, We need real protection from the NSA, Ed Loomis, Kirk Wiebe, Thomas Drake, William Binney (left) and Diane Roark, Jan. 15, 2014. Wake up, America. While we've been paying attention to other things, our intelligence agencies have been tearing holes into the Bill of Rights. On Friday, President Obama is expected to issue new guidelines that purport to rein in these abuses, but leaked details leave little reason for hope that his proposals will go far enough. What America needs is a U-turn before we lose our freedom and our country. In the years since 9/11, administrations of both parties, along with U.S. intelligence agencies, have secretly built up enormous powers that they do not intend to relinquish. They were aided in this endeavor by the very institution that was supposed to be a safeguard, a Foreign Intelligence Surveillance Act (FISA) court whose secret rulings essentially set aside the Constitution. Ill-considered legislation from Congress has only enabled the collapse of checks and balances. In late 2005 and early 2006, the New York Times, then Mark Klein and USA TODAY received fragmentary information on a program that collected private information on Americans. Last June, publication of documents taken from the National Security Agency by Edward Snowden revealed a far more intrusive program of domestic spying. These programs were supposed to protect us, but the president's NSA review panel found that spying on Americans has not prevented any terrorist attacks. Even if it had, the power the government has aggregated is a more dangerous threat to our freedom than is terrorism itself. The executive branch has vast troves of electronic data on most Americans, even those who have never been suspected of a crime.

Washington Post, With court approval, NSA resumes bulk collection of phone data, Ellen Nakashima, June 30, 2015. A secret surveillance court says the government can resume collection for a 180-day transition period. The National Security Agency on Tuesday restarted its bulk collection of Americans’ phone records for a temporary period, following a federal court ruling this week that gave it the green light. The Foreign Intelligence Surveillance Court on Monday ruled that the NSA could resume gathering millions of Americans’ phone metadata — call times, dates and durations — to scan for links to foreign terrorists. [Court’s opinion.] But the resumption is good for only 180 days — or until Nov. 29, in compliance with the USA Freedom Act. That law, which President Obama signed June 2 after a contentious congressional debate, will end the government’s bulk collection of metadata. It provided, however, for a transition period to allow the NSA time to set up an alternative system in which the data is stored by the phone companies. After the law took effect, the government immediately applied to the surveillance court to restart its collection. Because Congress passed the bill a day after the underlying statute authorizing the NSA program had expired, there was a question as to whether lawmakers had authorized the government’s temporary harvesting of phone records.

U.S. News and World Report, NSA Whistleblowers Oppose Freedom Act, Endorse Long-Shot Bill, Ex-officials say the 'Free-dumb Act' wouldn't change much, Steven Nelson, April 27, 2015. Former NSA workers Thomas Drake, left, and William Binney, right, said Monday that Congress should repeal the entire Patriot Act and other post-9/11 surveillance laws. Former NSA workers Thomas Drake, left, and William Binney, right, said Monday that Congress should repeal the entire Patriot Act and other post-9/11 surveillance laws. Three former National Security Agency officials who oppose U.S. mass surveillance programs say they also oppose the USA Freedom Act, a reform package about to be reintroduced in Congress. The bill's final wording likely will be unveiled this week, kicking off an intense debate before the June 1 expiration of three surveillance provisions – most notably Section 215 of the Patriot Act, which the Bush and Obama administrations used to justify the bulk collection of U.S. call records. The Freedom Act would reauthorize the expiring provisions but prohibit bulk record collection under Section 215. Capitol Hill staffers working on the bill believe it would better protect privacy than a similar bill that failed last year. The three less-famous forerunners of whistleblower Edward Snowden, however, tell U.S. News the bill won’t meaningfully curb NSA activities and recommend returning to a pre-9/11 legal framework, which they say would keep the U.S. safe if authorities share intelligence.

Washington Post, In NSA-intercepted data, those not targeted far outnumber the foreigners who are, Barton Gellman, Julie Tate and Ashkan Soltani, July 5, 2014. Files provided by Snowden show the extent ordinary Web users are caught in the net. Ordinary Internet users, American and non-American alike, far outnumber legally targeted foreigners in the communications intercepted by the National Security Agency from U.S. digital networks, according to a four-month investigation by the Washington Post. Nine of 10 account holders found in a large cache of intercepted conversations, which former NSA contractor Edward Snowden (shown in a screen shot from a London television interview) provided in full to the Post, were not the intended NSA Logosurveillance targets but were caught in a net the agency had cast for somebody else. Many of them were Americans. Nearly half of the surveillance files, a strikingly high proportion, contained names, e-mail addresses or other details that the NSA marked as belonging to U.S. citizens or residents. NSA analysts masked, or “minimized,” more than 65,000 such references to protect Americans’ privacy, but the Post found nearly 900 additional e-mail addresses, unmasked in the files, that could be strongly linked to U.S. citizens or U.S.residents.

Washington Post, U.S. officials harbor doubts Obama’s NSA goal can be met, Sari Horwitz and Ellen Nakashima, Jan. 21, 2014. Some fear the president’s push to quickly revamp the phone-data collection program is unworkable. U.S. officials directed by President Obama to find a way to end the government’s role in gathering Americans’ phone records are deeply concerned that there may be no feasible way to accomplish the task soon, according to individuals familiar with the discussions. In a speech last week, Obama put the Justice Department and the Office of the Director of National Intelligence in charge of developing a plan by March 28 to transfer control of the massive database of records away from the National Security Agency — a step aimed at addressing widespread privacy concerns. But even among U.S. officials who applauded the recommendation in principle, there is a growing worry that the president’s goals are unattainable in the near future, officials said.

Washington Post, Head of intelligence calls on Snowden to return documents, Greg Miller, Jan. 29, 2014. James Clapper offers blistering remarks at an annual hearing on the most significant U.S. security threats.

Guardian, Obama's NSA 'Reforms' Are Little More Than a PR Attempt to Mollify the Public, Glenn Greenwald, Jan. 17, 2014. Obama is draping the banner of change over the NSA status quo. Bulk surveillance that caused such outrage will remain in place,In response to political scandal and public outrage, official Washington repeatedly uses the same well-worn tactic. Predictably, it is the same one that shaped President Obama's much-heralded Friday speech to announce his proposals for "reforming" the National Security Agency in the wake of seven months of intense worldwide controversy. The crux of this tactic is that US political leaders pretend to validate and even channel public anger by acknowledging that there are "serious questions that have been raised". They vow changes to fix the system and ensure these problems never happen again. And they then set out, with their actions, to do exactly the opposite: to make the system prettier and more politically palatable with empty, cosmetic "reforms" so as to placate public anger while leaving the system fundamentally unchanged, even more immune than before to serious challenge.

Justice Integrity Project, Former NSA Execs Warn Americans Against Loss of Political and Privacy Rights, Andrew Kreig, July 25, 2013. The NSA operates largely without accountability to other government branches or the public, according several former high-ranking NSA executives speaking July 25 at a forum at the National Press Club in Washington, DC. They said the NSA tries to collect as much phone, email, and social media data as possible from the world's population, including U.S. citizens, for storage and potential retrieval later. The process represents a massive loss of political freedom and privacy that Americans have enjoyed through history until recent years, according to panelists convened by the Government Accountability Project (GAP). GAP Executive Director Bea Edwards opened the forum by describing the pivotal role of whistleblowers to help the public understand when authorities overstep legal bounds.

Nacchio's Judge Resigns In Sex Scandal, Other Irregularities Alleged

New York Times, New Trial Is Ordered for Qwest Ex-Chief, Dan Frosch, March 18, 2008. A federal appeals court panel reversed the insider-trading conviction of Joseph P. Nacchio, the former chief executive of Qwest Communications International, on Monday and ordered that Mr. Nacchio receive a new trial in front of a different judge. Joseph P. Nacchio, the former chief executive of Qwest, accompanied last July by his wife, Ann, before his sentencing in Denver. He appealed his conviction for insider trading. Judge Paul J. Kelly and Judge Michael W. McConnell of the United States Court of Appeals for the 10th Circuit ruled for the majority in a 2-to-1 decision that a federal district court judge had wrongly excluded an expert witness for Mr. Nacchio during his trial last year.

Federal prosecutors accused Mr. Nacchio once a rising star in the telecommunications world, of knowingly concealing Qwest’s mounting financial troubles from investors, despite warnings from other executives, while simultaneously selling millions in personal shares. In a month-long trial, Mr. Nacchio’s defense team argued that Mr. Nacchio had not sold his shares because he was trying to hide information, but because the options were to expire soon. Last April, a Denver jury convicted Mr. Nacchio of 19 of 42 counts of insider trading, acquitting him of 23 other charges. In July, Judge Edward W. Nottingham sentenced him to six years in prison and ordered him to pay a fine of $19 million and forfeit $52 million in money he had earned from stock sales in 2001.

Mr. Nacchio, who has remained free on bond, appealed the conviction, arguing that there was inadequate evidence to convict him, that the jury had received improper instructions and that Judge Nottingham had wrongly disallowed expert testimony critical to his defense. Judge Kelly and Judge McConnell ruled that the exclusion of the expert witness warranted a new trial, and that the initial evidence presented was enough for the government to try Mr. Nacchio again. The witness in question, Daniel Fischel, an expert on corporate finance, was expected to testify that the pattern of Mr. Nacchio’s stock sales did not appear reliant on the insider information he was privy to as chief executive. But Judge Nottingham, siding with federal prosecutors, barred Mr. Fischel from presenting his analysis on the basis that the defense had not adequately disclosed his methodology and that his testimony could have an unfair influence over the jury. Mr. Fischel was only permitted to testify to the facts of Mr. Nacchio’s stock dealings.

AP via Summit Daily, Judge Nottingham Resigns, P. Solomon Banda, Oct. 31, 2008. A chief federal judge in Colorado who resigned amid misconduct allegations last week faced claims from an appellate judge Former U.S. District Judge Edward Nottinghamthat he patronized prostitutes, according to court documents released Thursday. The 10th U.S. Circuit Court of Appeals dismissed the complaints against Edward Nottingham, whose resignation went into effect Wednesday. In an order, Chief Circuit Judge Robert H. Henry said the complaints are unnecessary in light of Nottingham's resignation. He said the misconduct procedures apply only to active federal judges, noting Nottingham had resigned. Nottingham also faced an allegation from a prostitute that he had asked her to lie, according to the documents released by the Circuit Court on Thursday. It was unclear whether a criminal investigation is under way. Jeff Dorschner, a spokesman with the U.S. Attorney's Office, and FBI spokeswoman Kathleen Wright said they could not comment on the matter. Nottingham presided over the insider trading trial of former Qwest Communications CEO Joe Nacchio. Nottingham [shown in a file photo] ceased judicial activities and announced his resignation Oct. 21 amid investigation of the complaints.

Denver Post, Nottingham: A thoughtful judge and an exacting jurist, Felisa Cardona and Mike McPhee, Oct. 22, 2008. In nearly 19 years on the bench, former Chief U.S. District Judge Edward W. Nottingham Jr. often generated a mix of respect and aggravation from those who appeared before him. Always nattily attired — kerchief in pocket, impeccable suits and a bright- blue robe on the bench — Nottingham could be quick with cutting remarks directed at an unprepared attorney, and he kept the bar high for courtroom decorum, once famously sending a plaintiff out to change clothes.

Denver Post, District Judge Nottingham resigns, apologizes, Staff report, Oct. 21, 2008. Chief U.S. District Judge Edward Nottingham has resigned from the federal bench in the midst of an investigation into misconduct outside the courtroom. In divorce proceedings, Nottingham's former wife alleged that he had spent thousands of dollars in a strip club. Since that time, 9News reported that Nottingham's name popped up as a client in an investigation of a Denver prostitution ring and that a prostitute had complained to the 10th Circuit that Nottingham had asked her to mislead judicial investigators about their relationship. In an unsigned statement issued on Nottingham's behalf, the nearly 19-year federal judge apologized for his actions, which have never been formally detailed in an investigation by the 10th Circuit that remains secret. "Under Judge Nottingham's leadership, the District of Colorado developed and implemented several advanced technological methods of conducting court business to include electronic courtroom evidence presentation and electronic case filings," the statement said. "Throughout his judicial career, Judge Nottingham worked tirelessly to ensure that his courtroom and case management practices were premised on the law and applied fairly to all who appeared before him." After working as a judicial clerk and a federal prosecutor, Nottingham was appointed to the bench Nov. 27, 1989 by President George H.W. Bush.

AP via ABC News, Court orders shorter sentence for ex-Qwest CEO Joe Nacchio, P. Solomon Banda, July 31, 2009. An appeals court has ordered a new, shorter sentence for ex-Qwest CEO Joe Nacchio, saying his 6-year term for insider trading was too long. The 10th U.S. Circuit Court of Appeals ruled Friday that the trial judge overstated the amount of Nacchio's alleged financial gain. Nacchio was convicted in 2007 of 19 counts of insider trading and acquitted on 23 counts. Prosecutors alleged he sold $52 million in Qwest Communications International stock based on nonpublic information that the Denver-based telecommunications company was at risk. A three-judge panel at the 10th Circuit Court of Appeals in Denver on Friday agreed with Nacchio's lawyers that the $52 million figure was too high. Instead, the figure used should have been Nacchio's net profit resulting from illegal insider trading. Nacchio's attorneys argue that the former CEO is being punished for the price increase of Qwest stock from 1997, and his actual profit would have been $1.8 million, capping his prison sentence at 4 years, three months.

Law 360, Supreme Court Turns Down Nacchio's Rehearing Bid, Ryan Davis, Nov. 30, 2009. The U.S. Supreme Court has again declined to take up the insider trading case of imprisoned former Qwest Communications International Inc. CEO Joseph Nacchio, rejecting his request for reconsideration after denying his petition for writ of certiorari in October. The court on Monday denied without comment Nacchio's petition for a rehearing of its earlier ruling. The court's denial of his cert petition let stand the disgraced executive's conviction as affirmed by the U.S. Court of Appeals for the Tenth Circuit earlier this year. In his cert petition, Nacchio had argued that the Tenth Circuit improperly allowed critical expert testimony to be excluded from his trial. In March 2008, a three-judge panel of the Tenth Circuit said Judge Edward Nottingham of the U.S. District Court for the District of Colorado was wrong to exclude the testimony of defense expert Daniel Fischel, a professor. The panel overturned Nacchio's conviction by a 2-1 vote and ordered a new trial. The full Tenth Circuit ruled 5-4 in February that the expert testimony was properly excluded as unreliable and reinstated Nacchio's conviction.

The U.S. Chamber of Commerce, the Washington Legal Foundation, the National Association of Criminal Defense Lawyers and the New York Council of Defense Lawyers all filed amicus briefs urging the Supreme Court to hear Nacchio's case, arguing that it raised important questions about the type of expert testimony that can be used in securities litigation. Fischel was Nacchio's only substantive witness and was to have testified that the allegedly inside information Nacchio used had no impact on Qwest's stock price and that his stock sales were consistent with other similarly situated executives, according to the amicus briefs.

NJ.com/ Associated Press, Ex-Qwest CEO convicted of insider trading sues his lawyers, saying they billed him for underwear, in-room movies, March 23, 2011. The former chief executive officer of Qwest Communications today sued the lawyers [from the firm of former New Jersey U.S. Attorney Herbert Stern] who represented him in his insider-trading case, claiming they "grossly overbilled" him and sought payment for staff breakfasts, underwear and in-room movies.

Denver Post, Former Qwest CEO Joe Nacchio sues his attorneys, Steve Raabe, March 24, 2013. Former Qwest chief executive Joe Nacchio sued his attorneys Wednesday for negligence and overbilling, including charges for lawyers' underwear purchases. The lawsuit alleges that attorney Herbert Stern and his New Jersey law firm of Stern & Kilkullen charged unreasonable and inappropriate fees, and were "negligent and careless" in the defense of Nacchio, who was charged with 42 counts of insider trading in December 2005 and convicted on 19 counts in April 2007 after a 21-day trial. The lawsuit says Stern's firm billed Nacchio more than $25 million for representation in criminal and civil issues. Qwest has covered a portion of Nacchio's legal fees. The suit, filed in New Jersey Superior Court, claims Stern's firm inappropriately billed Nacchio "tens of thousands of dollars for staff breakfasts, the cost of attorney underwear and in-room (hotel) movies." "This billing was outrageous," said attorney Bruce Nagel, whose Roseland, N.J., firm is representing Nacchio in the lawsuit. The suit also alleges that Stern's firm was "negligent and careless in handling the defense of the criminal action. Among other things, they were barred by the trial court from calling a critical expert witness by virtue of their blatant failure to comply with basic litigation procedures."

Denver Post, Former Qwest CEO Joe Nacchio moved from prison to halfway house, Andy Vuong, Denver Post, April 1, 2013. Former Qwest CEO and convicted felon Joe Nacchio is wrapping up more than four years in prison at a halfway house in the New York area. Scheduled for release in September, Nacchio recently was transferred from the minimum-security Lewisburg prison camp in central Pennsylvania. He started his term at the Schuylkill minimum-security prison camp in Minersville, Pa., in April 2009 and was moved to Lewisburg two years later. According to the Federal Bureau of Prisons, Nacchio has been assigned to a residential reentry center, or a halfway house, that is overseen by a community corrections management field office in Brooklyn, N.Y.