FROM THE OFFICE OF PUBLIC AFFAIRS

INTRODUCTION

Good evening. I am delighted to be here with you tonight in this city rich with Mexican culture that is yet vibrantly American. I am especially pleased to be sharing the stage tonight with two distinguished former Mayors of San Antonio: Nelson Wolff and Henry Cisneros. I also want to acknowledge two friends of mine who are also friends of MALDEF’s: Michael Olivas and Adelfa Callejo. It has been wonderful to reconnect with them at this event.

Our gathering today comes soon after the tragic events of September 11^th which changed the complexion of the world and the way we must respond to it forever. With that change and the threat to our society, comes a historic challenge, responsibility, and opportunity for all of us.

As Under Secretary of Enforcement, I have been given a great charge to help direct our war against terrorist financing using our Treasury resources. As Under Secretary, I have oversight over: the Bureau of Alcohol, Tobacco and Firearms; U.S. Customs Service; Law Enforcement Training Center; Financial Crimes Enforcement Network; U.S. Secret Service; the Executive Office for Asset Forfeiture; and Office of Foreign Assets Control. I also provide enforcement policy guidance to the Criminal Investigation Division of the IRS which, as you can imagine, does not make me a popular guy on the cocktail party circuit! (laughter) In all seriousness, these duties and powers bring with them enormous responsibilities and opportunities.

When I assumed the role as Under Secretary in August of last year my expectations of what the job would entail were very different from how things have unfolded. I had planned to focus on money laundering and financial crimes during my tenure at Treasury until the September 11^th attacks permanently changed my priorities. The attack demolished more than just the towers erected as symbols of the entrepreneurial spirit of this country, it destroyed the sense of security so long enjoyed by the American people. I had the opportunity to visit Ground Zero shortly after the attacks and it is something that I will never forget. The rain pounded down as I gazed out over indescribable destruction. I was shocked, angered, horrified and awestruck at the magnitude of the devastation and loss of life that I witnessed that day.

President Bush immediately declared war on terrorism, stating that "We will direct every resource at our command to win the war against terrorists, every means of diplomacy, every tool of intelligence, every instrument of law enforcement, every financial influence. We will starve the terrorists of funding." The President directed Secretary O'Neill to lead the nation's war against the financing of global terrorism, and we have devoted our resources and expertise to fulfill this mandate ever since.

Keep in mind that no terrorist financing strategy existed at the time. There was no "play book" describing how to identify and disrupt terrorist financial networks. We had to develop a strategy quickly that both aggressively hunted down the financiers of terror while simultaneously protecting the civil liberties of all Americans.

We have been successful to date in forging an international coalition against terrorist financing. Since September, we have designated 236 individuals and entities who are supporters of terrorism and have blocked their assets and the channels that these terrorists use to move money. Worldwide, we have blocked over $112 million and have deterred donors and supporters from providing financial aid to terrorist groups. We are making a difference by making it risky and harder for terrorists to raise and move money.

And as a former prosecutor, I know first hand that the balancing of civil liberties with the pursuit of justice is not always easy. Rest assured, civil liberties will not be compromised as we continue to pursue our blocking actions. In fact three separate courts recently upheld the constitutionality of our blocking designations.

Let me briefly walk you through our process and those important decisions.

IEEPA/ EXECUTIVE ORDER 13224

The International Emergency Economic Powers Act ("IEEPA") is the principal tool used to stop terrorist financing. It provides broad authority to impose comprehensive trade and financial sanctions against persons and entities that directly or indirectly finance terror.

Essentially, IEEPA authorizes the President to respond to foreign threats to the national security or economy of the United States by declaring a national emergency with respect to an identified threat.

Relying on the authorities found in the International Emergency Powers Act, President Bush signed Executive Order 13224 authorizing the Treasury Department to freeze the assets of individuals or entities believed to be directly or indirectly financing acts of terror. These individuals or entities are placed on the Treasury’s list of terrorist financiers. By virtue of this designation, these persons are denied access to the U.S. financial system.

It is also important to note that before a listing is made, an interagency group comprised of State, CIA, OFAC, FBI, DOJ and others review all recommendations for designation.

The individuals and entities added to the U.S. list are then submitted to the U.N. Security Council, 1390 Sanctions Committee, to be added to the U.N. list for blocking.

If an individual or entity believes it has been placed on this list in error, it can appeal the designation.

As you can see, the process thorough and deliberative. It involves a detailed analysis of intelligence and law enforcement information, great consideration of all relevant facts, and the consensus of interested agencies. And while there are those who have alleged that the government is targeting Islamic and Arabic interests, this is simply not the case. Profiling is not at issue – we follow the money trail wherever it leads us.

To protect the citizens of this great country and ensure that terrorists are dealt with accordingly, we must identify the threat and take action, all the while respecting the rights of individuals.

As I mentioned to you earlier, the process has already withstood rigorous legal scrutiny. I want to briefly highlight for you some of the legal issues decided by the courts:

"The Holy Land Foundation for Relief and Development (HLF) claimed that it was the largest Islamic charity in the United States. Last December, the President designated HLF as a terrorist organization because it acts for or on behalf of Hamas, a Palestinian organization designated as a terrorist entity in 1995. As a result of the designation, the Treasury Department froze approximately $6 million in HLF’s financial assets and property.

HLF sought judicial action to lift the blocking, challenging the legal and factual support for the government’s action in federal district court. It alleged that the government acted "arbitrarily and capriciously" (in violation of the Administrative Procedures Act) and interfered with its constitutional rights.

On August 8th, the federal court in the District of Columbia denied HLF’s motion for preliminary injunction, granted the government’s motion for summary judgment, and granted all but one element of the government’s motion to dismiss.

The court found that HLF has had financial connections to Hamas since its creation in 1989. Hamas designated HLF to receive donations on its behalf and HLF leaders have sought direction from Hamas leaders and met with them on several occasions. In addition, HLF funds Hamas-controlled organizations, provides financial support to the orphans and families of Hamas martyrs and prisoners, and HLF’s Jerusalem office acted on behalf of Hamas.

In mid-December, the Department blocked the assets of Global Relief Foundation (GRF) pending an investigation to determine whether GRF had a connection to the terrorists responsible for the events of September 11th. GRF’s activities included sending money to entities and individuals in 22 countries.

Although GRF challenged the blocking in aid of investigation in the Northern District of Illinois, their motion for preliminary injunction was denied. In June 2002, the court found probable cause to believe GRF and its executive director were agents of a foreign power (as needed to support a warrant to search and seize property pursuant to the Foreign Intelligence Surveillance Act). The court clearly affirmed that these blocking actions are within "the power of the Executive Branch of the United States Government to conduct foreign policy."

And lastly,

Benevolence International Foundation (BIF)

Similarly, in mid-December the Department blocked the assets of Benevolence International Foundation (BIF) pending an investigation to determine whether it should be designated as a terrorist organization.

BIF filed a motion for a preliminary injunction to lift the blocking. That motion has been stayed pending resolution of the criminal indictment brought against BIF’s CEO, Arnout, by the U.S. Attorney in Chicago. In that action, the FBI filed an affidavit stating it had evidence demonstrating that BIF/Arnout had a relationship with Usama Bin Laden, financially supported al Qaeda, and was connected with the Chechen mujahideen and Hezb e Islamia, a military group operating at various times in Afghanistan and Azerbaijan.

The Treasury Department has continued to investigate BIF and has notified the organization of intent to consider the designation of the organization under Executive Order 13324."

The courts have spoken. We are confident that we have successfully been able to balance the rights of the individuals while simultaneously pursuing those who finance acts of death and destruction.

I am grateful for the opportunity that President Bush has given me to be part of such an important issue during a critical time in our nation’s history.

As many of you know, upon confirmation I became the highest-ranking Hispanic law enforcement official in the nation. I am proud of my Hispanic background and I am grateful for President Bush’s respect and appreciation for the Hispanic community.

In fact, Hispanics comprise more than 10% of those political appointments requiring Senate confirmation. On a personal note, my first hire as Under Secretary for Enforcement was a young man named Juan Zarate who was a rising star over at the Justice Department at the time. Juan has been my right hand during this difficult and challenging year as my Deputy Assistant Secretary for Terrorism and Violent Crime.

We all have been offered an enormous opportunity to contribute and to take on the full mantle of leadership in government. Among those receiving high-ranking appointments in the Bush Administration include: Mel Martinez, Secretary of Housing and Urban Development; Rosario Marin, U.S. Treasurer; Roel Campos, the first Latino Commissioner of the Securities Exchange Commission; Al Gonzalez, first appointed by then Governor Bush to the Texas Supreme Court and now serving as White House Chief Counsel; Gaddy Vazquez, the Director of the Peace Corps; and and Tony Garza, Ambassador to Mexico. Hispanics have been and continue to be the benefactors of much support and recognition from the Administration - it is truly an Administration that lauds diversity and stands behind its commitment of opportunity for all.

MIGUEL ESTRADA – JUDICIAL NOMINATION

As you all are well aware, accomplished and talented Hispanics have made great strides and are opening doors for our future generations. I want to highlight one Latino lawyer that I think deserves a special mention in this regard. Miguel Estrada, a recent Bush nominee to the D.C. Circuit Court of Appeals, epitomizes the American success story. Born in the Honduras, Miguel came to this country as a teenager speaking little to no English. Remarkably he was able to graduate Phi Beta Kappa from Columbia College in New York and magna cum laude from Harvard Law School just a few years after arriving in this country. While at Harvard Miguel had the distinction of serving as editor of the Harvard Law Review and went on to clerk for the Second Circuit Court of Appeals. In 1988 Miguel also served as a law clerk to Supreme Court Justice Anthony Kennedy. The list of this man’s accomplishments is extensive and well known in the Hispanic community. He served as Assistant U.S. Solicitor General during both the Bush and Clinton Administrations from 1992-1997. He has argued 15 cases before the U.S. Supreme Court, both criminal and civil.

Our community, our young people, need more role models like Miguel. He is a living example of why thousands of young Latinos each year come to this country. His hard work and perseverance is a stellar example of what determination, drive and opportunity can achieve. His fight for betterment and his steadfastness are indicative of the Latino spirit -- a spirit strong, focused, and proud. I say this to you sincerely as a Latino with three children– not just as a political figure from Washington: Our community cannot afford to waste a remarkable role model like Miguel over ideological bickering and politicking. I encourage each of you, as well as MALDEF, to support Miguel Estrada's nomination to the D.C. Court of Appeals. Anything less than that would be a disservice to our community as a whole.

Before concluding my remarks I do want to touch on one last initiative that I consider critical to the future of our country. We live in an extraordinarily perilous time, which requires creative strategies to secure the homeland. On June 6^th, President Bush opened a new chapter in government.. The new Department of Homeland Security is a creative, practical and necessary approach to the management of bureaucracy.

As the President so appropriately noted, "the U.S. government has no more important mission than protecting the homeland from future terrorist attacks. Yet the country has never had a comprehensive and shared vision of how best to achieve this goal."

The Office of Homeland Security is expected to be staffed by more than 170,000 employees and will be the second largest government agency after the Department of Defense.. A restructuring of this magnitude has only been seen once before in the history of the nation when President Truman reorganized the government to create the Department of Defense.

President Bush is dedicated to removing those barriers that impede the efficiency of government. He is dedicated to ensuring that the proverbial "turf battles" cease to exist. He is dedicated to protecting this great nation.

The Office of Homeland Security, at the President's direction, has developed a National Strategy. "The strategy is an aggressive framework to meet the threats of today an prepare for the threats of tomorrow. For the first time federal, state and local officials -- and the private sector -- will have a single roadmap to help guide them as they develop their individual security plans."

The duplication of efforts will be eliminated, as will unnecessary jurisdictional disputes. Information sharing, a critical activity in this war on terrorism will be fostered and open communication and exchange a

by-product of this new infrastructure. Enhanced cooperation and a one-team approach will facilitate the ultimate goal – saving the lives of the American people!

CONCLUSION

In closing, I want to thank you again for this opportunity to be here with you tonight. As many Mexican Americans get ready to celebrate Mexico’s fight against the Spaniards for independence on September 16^th, we are reminded of our own situation. Just as our forefathers fought a foreign enemy that threatened their freedom, so too are we standing against our enemies.

Today we are fighting for the very freedom that defines a democratic nation, a freedom that perhaps we have taken for granted. We must stand united, as an American people, so that our liberties are protected from those who envy our blessings and hate our strength. It is the protection of those liberties afforded us under the Constitution that we must guard with all our might --- our right to be free cannot be taken from us. They may destroy our structures, but they cannot and will not destroy our spirit!

I wish you continued success in your noble efforts. Buena Suerte y muchas gracias.