Obama Said to Keep NSA in Charge of Phone Records for Now

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A Verizon pay phone in New York City. Close

A Verizon pay phone in New York City.

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Photographer: Daniel Acker/Bloomberg

A Verizon pay phone in New York City.

President Barack Obama’s plan to keep phone data with the National Security Agency for now is a victory for telecommunications companies, which resisted the idea of holding the records themselves over concerns about lawsuits, lost business and unwanted responsibility.

A White House advisory panel recommended last year that the phone metadata should be held by companies such as Verizon Communications Inc. (VZ), AT&T Inc. (T) or some other private entity. Obama instead will ask Congress to decide the matter when he releases his proposal to limit NSA surveillance programs tomorrow, according to a person familiar with the plans, who spoke on condition of anonymity before the announcement.

“What matters is not so much the fact that they won’t be required to hold those records, but rather just to be out from any kind of requirement one way or another,” said Charles Golvin, an independent technology industry analyst. “That’s a big win for the carriers.”

The collection and storage of bulk communications data by the government has been one of the most contentious issues in the furor that followed disclosures about the NSA’s sweeping surveillance programs by former government contractor Edward Snowden. Whether such collection should continue has already sparked a fight in Congress over the program.

Photographer: Angel Navarrete/Bloomberg

AT&T Chief Executive Officer Randall Stephenson said he was “anxiously awaiting” Obama’s plan. Close

AT&T Chief Executive Officer Randall Stephenson said he was “anxiously awaiting” Obama’s plan.

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Photographer: Angel Navarrete/Bloomberg

AT&T Chief Executive Officer Randall Stephenson said he was “anxiously awaiting” Obama’s plan.

The administration previously has signaled that the president’s announcement also will touch on tightening guidelines for spying on foreign leaders and court procedures. Several of the recommendations made by Obama’s five-member panel would require congressional action.

Privacy Advocates

Civil liberties advocates told reporters on a conference call today they’re prepared to take their fight to Congress if Obama doesn’t announce significant reforms.

“It is impractical to presume the executive branch will hold itself fully accountable,” said Angela Canterbury, director of public policy for the Washington-based nonprofit Project on Government Oversight and Accountability.

It will be “a failure” if Obama doesn’t adopt a recommendation from the advisory panel that the NSA’s collection of metadata be stopped, said Michelle Richardson, legislative counsel of the ACLU. “That will be the true test about whether he is sufficiently dealing with this NSA scandal,” she said.

Congressional Responsibility

“If he does fail to take a stand and exercise the bold leadership that’s necessary, it will become Congress’ responsibility,” said Kevin Bankston, policy director for the Washington-based Open Technology Institute.

Officials of major telecommunications companies argued that adopting the requirement would impose major legal and financial burdens on them, exposing them to possible lawsuits for providing the data to the government and forcing them to bolster their legal staffs to handle requests for data, according to two intelligence officials who participated in the administration’s review of NSA programs. They asked for anonymity to talk about internal deliberations.

That argument was bolstered by Senator Dianne Feinstein, the chairman of the Senate intelligence committee, who said after a meeting with Obama last week that being forced to collect and keep the phone data would cost U.S. carriers as much as $60 million a year.

Third Party

A third party that could store the data doesn’t yet exist. An administration official familiar with the president’s thinking said Congress would have to enact legislation that would enable a third-party to retain the records.

AT&T Chief Executive Officer Randall Stephenson said he was “anxiously awaiting” Obama’s plan. Speaking at a Christian Science Monitor breakfast yesterday in Washington, Stephenson declined to disclose his position on keeping the records.

“At the end of the day, the data needs to be provided only pursuant to a court order or a subpoena or a warrant,” Stephenson said. “So where the data is housed probably isn’t that important, as long as the rules are clarified and we know exactly what we’re looking at.”

The data collection issue crosses party lines.

Senator Patrick Leahy, a Vermont Democrat, and Representative James Sensenbrenner, a Wisconsin Republican, have introduced legislation that would prohibit the NSA from collecting bulk phone records, as has Senator Rand Paul, a Kentucky Republican backed by small-government Tea Party groups.

Phone Records

The NSA, or Federal Bureau of Investigation, would have to get a court order on a case-by-case basis to seek records from the phone companies under their bills.

Feinstein, a California Democrat, and Representative Mike Rogers, a Michigan Republican who is chairman of the House intelligence panel, have said they will fight to keep the bulk-records program going.

The outcome is too close to call, Stewart Baker, a former general counsel for the National Security Agency, said in an interview. “I think it’s going to be very close,” he said.

Baker, now a Washington-based partner at Steptoe & Johnson LLP, said that Obama has been pulled back by his advisers from taking radical steps to curb spy programs.

“He came in with a set of views but he listened very hard to the interagency and all of the intelligence agencies and they moved him considerably on the value of the programs,” Baker said.

The intelligence officials said the president also opposes requiring the government in most cases to obtain a warrant to access the data. That was another of the recommendations from Obama’s independent panel.

Requiring such warrants won’t hinder terrorism probes, members of the review panel said Jan. 14 in testimony to the Senate Judiciary Committee.

White House officials also have suggested that Obama may be willing to curtail snooping on allies while preserving the ability to monitor leaders from hostile nations. The president has previously signaled he favors creating a privacy advocate at the secret court that oversees foreign surveillance.

To contact the reporters on this story: Julianna Goldman in Washington at jgoldman6@bloomberg.net; Margaret Talev in Washington at mtalev@bloomberg.net; Chris Strohm in Washington at cstrohm1@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net

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