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Memorandum for the Record

Event: Interview of Judith Knez Type of Event: On-the-Record Interview Date of interview: 11/5/03 Date memo prepared: 11107/03 Special Access Issues: None Prepared by: John Roth Team Number: 4 Location: FinCEN offices, Tyson's corner Classification: ~ Present, non-Commission: Judith Starr, Esq., Tom McGivern, Esq., Judith Knez Participants-Commission: John Roth and Doug Greenburg This memorandum provides a summary of the most important points covered in the above-entitled interview, but is not a verbatim account. The memorandum is organized by subject and does not necessarily follow the order of the interview. The witness provided all of the information in this memorandum during the interview, except where noted by square brackets. (U) Background Judith Knez is the Assistant Director, Office of Intelligence, at the Financial Crimes Enforcement network (FinCEN). She began her government career as an FBI analyst, working in as organized crime specialist and then counter-terrorism in Atlanta. In 1988 she worked at FBI headquarters in their SIOC where she worked issues related to the Pan Am 103 bombing. In 1989, she joined the Department of Energy in their office of threat assessment, which included briefing individuals about the risks involved in their upcoming foreign travel visits as weIl as lecturing on counter-intelligence awareness generally, Knez joined FinCEN in 1991, where she initially worked as an analyst until 1995, at which time she became a branch chief in a classified special projects area. She

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, chief Jim Reynolds, concerning domestic terrorism.i.After her return, she spent nine months in the regulatory area. In 1998, she assumed her current job. Initially it was titled the Office of Intelligence Liaison, and-then changed at some point to its current title, Office of Intelligence. (U) , Duties of the Office of Intelligence The duties of her officeconsist (Mike Rorney., . '. . of cables comes

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of reviewing intelligence obtained from main Treasury th . The raw take Knez then

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__ -...Icontaining raw data that the intelligence (CIA NSAz and State) wishes to distribute. It also includes OIA's Harmony i systeml las well as information from TIIC, and ! finished intelligence from intellink. It does not include any information from the FBI i case files (such as LHMs, ECs and 302s), although it does include cables, such as threat . warnings, the FBI sends to others. The cables don't include any aICE or DHS, Secret Service, visa or immigration records, nor an commercial im ort-ex ort data that Customs keeps. Additionally, Knez stated."-"!""- __ ----r---------....., s ecialized databases to which onl their ,em 10 ees have access.

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I OIV, in tum, Lw~,''':":'iI':"'l -wr-i~te-up-a~dl""e-sc-r~ip~t!'"'io-n-o...,f~tl""b:e-in...,fi!""orrn-a~t'!'"10-n-c-o-n~t~""I"I-ned....,..w""""!"it,....him-t~hle.,sl" and attempt to pass it to the relevant law enfi:~cement a :' fv are characterized a Intelligence reporti:"a-t-ed~F~eb,..ru-a-ry-l ,...,2~OO~I-r-eg..,.a-rd"":'!'"'in-r---------..,..---, as an' example of such a report.' Knezstated that prior to 9/11 she would also .• !provide the number of the classified cable, so the law enforcement agent could look it up .: and tell why Knez produced the report::,(U) ,.:' .. The report prepared by OIV does n,or contain any classified information, nor does the analyst preparing report know-of theclassified information, or even that the request was predicated by/Classified information, Knez stated that prior to 9/11, she would make about six 16 seven of these types of'referrals per month. While terrorist financing was a priority f,or her/there was ~ot much specificity in the cables. Of the six to seven that she may do in a month, about.two would involve potential terrorist activity. After 9/11, she focused on counter-terr rismexclusivel . The volume of the re ortin i creas d zrea I

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agencies were at Fin EN in the time just after 9/11 the were able to roduce a significantly greater number of reports. 9/11 Classified Information repOrts./(U) "
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r<~e~/first in~rlcjilt'ed that prior to 91 II, such terrorist related reports would go to the :Na~i'onal S,e'cl,ltityside of the FBI, specifically, the bin Laden Unit. Later. when showed ,/ the transmittal documents attached to such referr~.1sl she : acknowledged that it was delivered to the Falrepresentative at FinCEN, which during ':the p~9h 1 period was SSA Harold \yilst)fl'. Knez complained that often law , enforcement did not realize the valueof linking people to financial accounts. (U)

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:~ez indicated post 9/Jlfh~~~er reports are given to the Foreign Terrorist Asset 'Tracking CenterGroup (FTATG) (Frank Figeroa from ICE is currently in charge there, /, and Joe Lanzals the FinCEN liaison there) and to the FBI's Terrorist Finance Operations
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Section (TFOS). She indicated she is ~n~we:':~nat happens to them, although she went over to FTATG recently on another mattei'~ncf::~~w that her reports were just piled on the table. She said that they told her that t~ey\~<~reJ~'s~ getting to them now. She indicated that one of the ones they reviewed, a prPact~~~Jep~:i't? was moving to the PCC for decision. With regard to the reports submitte~:~t.o she doesn't know what happens to them. She can not raise them on the phon~,~~d the:x"n,avegiven no feedback on the reports. She has raised this issue with Dennis. I¥:tmel att~"frank Waikart, with no improvement. Knez characterized it as the "jwf~" norM\r~~y they do business." (U)

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In addition to the proactive targeting reports th~t ~4~::produ~ using classified information, she also will come across anomalies i~,'\~e course"'of'her research that have no intelli ence connection. For exam Ie, h ", '"

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Knez was shown and asked about her invdlvement in\. he '13a,~~kaatnvestigation, i identifie '''ClOUS A'" ,

" As a result, she.put Lot-o-g-et""e-r -a-s-et-o-c""lih-a-rt-s-d'!"e-ta~i~li~n-g~I'!"in"'l'k-a-g-es-w~it':"'h-o-t:-he-r~i!""'n""ld'!'"iv""lii~du-a~fr-l's and accounts, whi,c~ the

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JSh~\presented this" ' .. information to the FBI representative and FinCEN also notified FBI Mhmeapolis, FBI \ .. San Diego and Customs Minn,eapoljs. who had open cases, Additionally, ;jnCEN ' prepared

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Knez then described a series of presentations of the information, including an August 2000 presentation to Dale Watson of the FBI and Dick Clarke of the NSC and a May 1, 2000, briefing of Rick Newcomb ofOFAC, who had recently returned from the UAE, and a October, 2000 briefing of Mike Romey and Rick Newcomb and Mark Roberts of OFAC. Knez refreshed her recollection of the individuals briefed by reviewing a time line she had made, Of note was the fact that Knez briefed President Bush, Secretary O'Neill and Attorney General Ashcroft in November of2001, when the three came to FinCEN for a press conference announcing the freeze. (U)

I Notwithstanding [hat the 911I Commission's June document request [0 Treasury required production of this document, it had not been produced to the Commission by the date of the interview. There was additional material within the file that Knez brought with her to the interview, such as a time line of actions she took with regard to the Barakaat investigation, which was also responsive to our request. The author made an oral request to the Treasury representative, Thomas McGivern, for the contents of Knez's file, which he agreed to,

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Knez was shown ·~··ii~CEN.ir:telligence report produced t~~~~·c~~.:nrssionD . Iregarding Benevolence.Intejngtjona] Foundation BIF . This re ort was produced as a result of Knez reviewlnl:l' ..... regarding BIF's potential links to terrorist activity. The SAR on BIF was passed to OIV on October 19, 2000, whi ch then led to a report being issued on February 1, 2001. Thi s reportwas sent to IRS, FBI and Customs representatives at FinCEN. For the FBI, that would have been SSA Harold Wilson. The report indicates that no record could be found in the FBh;riminal database of Benevolence, although by this time the FBI had an open '\ FFI in Chicago on the matter. Knez does not know how this could have occurred, in that ..... FBI detailee would have access to all FBI investigative information, whether it was the Criminal or intelligence. (S) [See MFR re interview of current FBI FinCEN representative SSAL. Williams (stating that, until 6 months ago, if the FBI was not wiiling to release to'linCEN the existence of a particular matter, it informed FinCEN that thecheck of FBI indices was negative, creating the impression the FBI had no record of the matter; 6 months ago, the FBI began stating in such circumstances that it has no releasable information). .

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.. Knez stated that prior to 9/11, there were 2 to 3 individuals working in the section. Now, .. there are approximately 11 people, Including a director, an assistant director, two team .. leaders (one ',of whom is awaiting clearance). The balance are contained within three ._sections based on eo ra hical division: The increase in personnel was a gradual change. She noted that she ...~e-o..,.,..lc-e-w-a~"""e-.e-n out in FYOl, but that funding was restored with a post 9/11 t ... eroed z supplemental bu~get increase, and it had no effect on operations. (U) Knez indicated that she does not have enough staff to complete her mission. She could not estimate what sort of an increase she would need in order to review and research all of the intelligence coming in. (U) Knez at one time had ~'-.number of detailees from other agencies after 9/11 .. Many of them have left. For example, the FBI, though TFOS, detailed an analyst from Buffalo to help. The FBI has said the will re lace that e ut

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At the conclusion of the interview, Knez provided the interviewers with an unclassified document entitled "Editorial/Commentary," which she stated reflects her views as a private citizen and not as a FinCEN employee. It is appended to this interview memorandum. (U)

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