Business Week reports:
President George W. Bush has bestowed on his intelligence czar, John Negroponte, broad authority, in the name of national security, to excuse publicly traded companies from their usual accounting and securities-disclosure obligations. Notice of the development came in a brief entry in the Federal Register, dated May 5, 2006, that was opaque to the untrained eye.
Unbeknownst to almost all of Washington and the financial world, Bush and every other President since Jimmy Carter have had the authority to exempt companies working on certain top-secret defense projects from portions of the 1934 Securities Exchange Act. Administration officials told BusinessWeek that they believe this is the first time a President has ever delegated the authority to someone outside the Oval Office. It couldn't be immediately determined whether any company has received a waiver under this provision.
Meanwhile, they add, they can't find evidence that such waivers have been granted. But I think we've got a few examples of the kinds of businesses that might apply for and receive such a waiver from a more strongly empowered Director of National Intelligence.
Part One - Corrupt Contractors
Our friend
Laura Rozen warned of the national security implications of the Duke Cunningham scandal:
CIA contracts are not public, and there’s an added veil of secrecy and opaqueness to the “black” contracting world. Cunningham bragged about his ability to help influence the procuring of contracts from this secretive Congressional source in a letter to San Diego contractors, saying he was in a position to influence the awarding of “black” contracts after he was assigned to the House Intelligence committee in 2001. An individual who has been identified in press reports as Co-conspirator One in the Cunningham indictment, San Diego-based defense contractor Brent Wilkes, who has not yet been charged, has more than a dozen companies in his corporate empire. Efforts by journalists to sort out which companies might have received CIA contracts have gotten nowhere -- until now.
On December 8, the Prospect received an anonymous tip about CIA contracts: The name of a Wilkes-affiliated company that allegedly had received some of them. The company is called Archer Logistics, which is, according to its website, a US-based “open source acquisition group … uniquely positioned to execute rapid acquisition requests, provide immediate delivery channels and augment post-sales support. ...Archer Logistics has also developed a unique delivery structure that can provide turnaround times of 24 hours in cases of extreme need.” (Its name is similar to a Senate-registered, Wilkes-affiliate company Archer Defense, “a defense logistics and technology company,” but not, apparently, the same company.) According to its website, incorporation documents in the Commonwealth of Virginia and public-online address books, Archer Logistics is located in the same Chantilly, Virginia address that houses the Virginia offices of ADCS, Inc. Neither Archer Logistics nor the ADCS Chantilly office answered the phone, and neither has responded to numerous messages.
When asked about whether Archer Logistics was receiving CIA contracts, a spokesman for the CIA told the Prospect on December 9 that “as a rule, the CIA does not publicly discuss who may or may not have a contractual relationship with the Agency.” Previously, the CIA had indicated that other Wilkes-affiliated companies – ADCS, Pure Aqua Technologies, Perfect Wave Technologies, Group W Transport – did not have contracts with the Agency.
Maybe it used to be that you could catch some of these guys on the balance sheet if they tried to make certain incomes disappear....but not anymore if they've got the right buddies willing to wave a magic wand and make their earnings disappear.
Part Two - Winged Torture
The recently dismissed case
filed by the ACLU on behalf of Khaled el-Masri charged that the firm Aero Contractors Limited had run afoul of the Alien Tort Statute by helping to illegally detain the German national in Afghanistan without charge. An
Indymedia report from Atlanta gives you more details on the North Carolina-based company that helped fly el-Masri to justice.
Maybe it's going to be harder for the CIA to use front companies in the future; but perhaps they won't have to, they can charter legitimate flights from legitimate companies for big money that the CFO won't have to report.
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So, Business Week, there you go - follow up on those leads, and if you don't hopefully someone else will.
And why take this out of the President's hands? BW doesn't really try to answer this question, either. I would suggest that deniability sure becomes more plausible if no one in the White House knows about the decision - the order is simply given to make paper trails disappear. And with attorneys like the ACLU and CCR employing chain of command theories to prosecute our rogue White House and Cabinet officials for the awful acts they have endorsed or perhaps become linked into, I'm sure they want protection.