European Parliament Vetoes U.S. Deal For SWIFT Data Access
February 11, 2010
The European Parliament on Thursday scrapped a controversial deal that would have permitted the U.S. Treasury Department to gain access to data transmitted over the messaging network run by the Society for Worldwide Interbank Financial Telecommunications, in the pursuit of terrorists.
European Union lawmakers in Strasbourg, France voted 378 to 196 against the deal with 31 abstentions. The decision to overturn the agreement on the grounds it violated European Union privacy rules follows intense U.S. lobbying in its favor.
The deal would have formalized a secret program struck between the U.S. Treasury and SWIFT after the 9/11 terrorist attack that allowed U.S. authorities to collect a “limited set” of information from SWIFT strictly for anti-terror probes.
The EU governments must now renegotiate the deal with the EU parliament to allow data sharing for nine months while the EU seeks a longer-term agreement which would allow European authorities to also see similar U.S. banking data.
In November, EU interior ministers had hurriedly agreed to an interim nine-month deal to continue allowing U.S. anti-terror investigators limited access to details of wire transfers conducted over the SWIFT network.
The deal was signed a day before the Lisbon Treaty was to have taken effect on December 1, 2009. The treaty would have required EU governments to consult with the parliament.
The data to be shared with the U.S. Treasury would only apply to SWIFT’s FIN traffic, which typically includes instructions about securities transactions and payments.
It also covers Treasury-related (foreign-exchange, intra and end of day payment balance) messages and messages related to trade finance. While SWIFT is not a payments system, financial firms do rely on its services to securely relay standardized, electronically readable messages for funds transfers and securities transactions on a daily basis. It processes a total of over 10 million messages daily.
In November 2006, a panel of EU data protection officials said that SWIFT violated European Union privacy laws by turning over information to U.S. authorities. The panel called on SWIFT to stop providing the data. SWIFT has always maintained that it turned over specific sets of data to the U.S. Treasury based on narrow subpoenas and did not violate EU law because it obtained guarantees from the Treasury on the limited use of the data. After analyzing SWIFT’s messaging services, the Belgian Data protection Commission in December 2008 said that SWIFT did follow all Belgian data protection legislation.
In a recent interview with German magazine Der Spiegel, Adam Szubin, the U.S. Treasury Department official in charge of the Terrorist Finance Tracking Program, said by tapping into the SWIFT data, the U.S. had identified and broken up a number of potentially deadly terrorist cells operating in Europe. Overall, the program generated about 1,450 tips to European governments. The U.S. mission to the European Union on Thursday said it was disappointed with the European Parliament’s decision and called it “a setback for US-EU counterterror cooperation.”
