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U.S. judge allows spying lawsuit against SWIFT to proceed.

by Steve Schwarz Wed Jun 20th, 2007 at 12:53:16 AM EST

Hello, I am plaintiffs' counsel in Walker v. SWIFT, a U.S. lawsuit challenging SWIFT's disclosure of its database to the U.S. government as illegal under the Fourth Amendment and federal Right to Financial Privacy Act.

SWIFT, which stands for "Society for Worldwide Interbank Financial Telecommunication", is a giant corporation based in Belgium and is the nerve center of the global financial industry.  

Last June the New York Times revealed that the U.S. Treasury Department and CIA approached SWIFT and asked for customer financial records in a manner outside the legal process.  SWIFT responded by giving the government its entire database.  The original article can be viewed here:


I posted this diary on Daily Kos and was encouraged to post it here as well.  A press release follows:

Press Release:

Contact: Steven Schwarz (773-837-6134)
               Carl Mayer (609-462-7979)
               Bruce Afran (609-924-2075)

For Immediate Release: June 15, 2007

Federal Court in Chicago rules against SWIFT in domestic bank spying case.

Bank clearinghouse fails in bid to dismiss class action charging violation of bank privacy laws

No government right to "unfettered access" to private bank records, court rules

SWIFT Facing Billions in Damages

Chicago (June 15, 2007).  A federal district court has upheld a multi-billion dollar class action against SWIFT, the international bank clearinghouse, for secretly sharing customers' bank records with the U.S. government in violation of bank privacy laws.

Lawyers today announced that Chief Judge James F. Holderman of U.S. District Court in Chicago refused this week to dismiss claims that SWIFT's disclosure of millions of bank records to the government violated the federal Right to Financial Privacy Act and the Fourth Amendment.

In his 20-page opinion, Judge Holderman rejected SWIFT's defense that it acted in good faith by relying on government subpoenas.  Any claim to "unfettered government access to the bank records of private citizens" is "constitutionally problematic", the court said.  

In refusing to dismiss the case, Judge Holderman noted reports that "SWIFT officials were aware that their disclosures were legally suspect, but they nevertheless continued to supply database information to the U.S. government."

Plaintiffs Ian Walker and Stephen Kruse filed the massive class action last June, seeking billions in federal privacy damages, after the New York Times reported the administration had been requesting, and receiving, customer financial records from SWIFT without judicial authorization and limited Congressional oversight.

The plaintiffs are represented by Chicago attorney Steven Schwarz and New Jersey attorneys Bruce Afran, and Carl Mayer.  The three are also among the leaders in the pending NSA phone records suit in San Francisco.

"The SWIFT program is another example of reckless disregard for the Constitution and values that make us who we are as a nation," Schwarz said in response to Judge Holderman's ruling.  "As Benjamin Franklin said, `those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety.' "

"Never has any U.S. administration sanctioned such wide-ranging violations of privacy rights," Afran added.  "This is yet another decision recognizing the illegality of the administration's domestic spy program."  

SWIFT, the Society for Worldwide Interbank Financial Telecommunication, based in Brussels, is the nerve center of the global banking industry and routes about $6 trillion daily between banks, brokerages, stock exchanges and other institutions.  The complaint charges SWIFT with disclosing its entire database to the United States Government without subpoena or court authority.

"SWIFT faces billions in damages after this week's ruling," Mayer said. "Federal bank privacy laws provide for $100 in damages for each illegal disclosure of customer records."

SWIFT's actions have been widely condemned overseas by privacy watchdogs in Germany, Belgium, France, and the European Union where some regulators have declared SWIFT's conduct to be in violation of their countries' privacy laws.

The decision comes as the Senate Judiciary Committee announced it will pursue long-hidden Justice Department memos authorizing the National Security Agency's "Terrorist Surveillance Program".

In August of 2006 federal judge Anna Diggs Taylor declared that program illegal and ordered it to be immediately halted.


"In our own time we have seen domination spread over the social landscape to a point where it is beyond all human control. Compared to this stupendous mobilization of materials, of wealth, of human intellect, of human labor for the single goal of domination, all other recent human achievements pale to almost trivial significance. Our art, science, medicine, literature, music and "charitable" acts seem like mere droppings from a table on which gory feasts on the spoils of conquest have engaged the attention of a system whose appetite for rule is utterly unrestrained."

Murray Bookchin

You can't be me, I'm taken

by Sven Triloqvist on Wed Jun 20th, 2007 at 01:23:16 AM EST
but what were their real reasons? That looks incredibly naive. Or is this question utterly naive? The US government would not have had any legal leverage over them, or would they?


"SWIFT's defense that it acted in good faith"
from the article you link to
"[the program] began as an emergency response to the Sept. 11 attacks, the officials said. Worried about potential legal liability, the Swift executives agreed to continue providing the data only after top officials, including Alan Greenspan, then chairman of the Federal Reserve, intervened. At that time, new controls were introduced."

"After an initial debate, Treasury Department lawyers, consulting with the Justice Department, concluded that the privacy laws applied to banks, not to a banking cooperative like Swift."


Good luck with the defense of our privacy and thanks for posting about this here!

by PeWi on Wed Jun 20th, 2007 at 05:19:21 AM EST
What is the definition of the "class" in this class action suit?

Can the last politician to go out the revolving door please turn the lights off?
by Migeru (migeru at eurotrib dot com) on Wed Jun 20th, 2007 at 06:05:32 AM EST
Class means "similarily situated."  

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Wed Jun 20th, 2007 at 08:15:58 AM EST
[ Parent ]
I don't mean what "class" is, but what "the class" is in this specific instance.

Can the last politician to go out the revolving door please turn the lights off?
by Migeru (migeru at eurotrib dot com) on Wed Jun 20th, 2007 at 08:25:16 AM EST
[ Parent ]
The class is very broadly defined as "all indviduals in the United States that have engaged in at least one domestic or international financial transaction since September, 2001".  

I have pdfs of the complaint and judge's decision and would be happy to send to anyone who would like to read them.  Alternatively, is there a way to upload pdf files to this site?  

by Steve Schwarz on Wed Jun 20th, 2007 at 10:24:47 AM EST
[ Parent ]
If the pdf is on a website, you can link to that site and people can access the pdf.

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Wed Jun 20th, 2007 at 10:47:18 AM EST
[ Parent ]
Thanks.  Unfortunately, I don't have my own site.  The documents available on the U.S. Court's electronic filings site but it requires registration and password and is hard to navigate.
by Steve Schwarz on Wed Jun 20th, 2007 at 11:48:13 AM EST
[ Parent ]
You're interpreting it correctly.  Just about every adult in the U.S. is in the class.  The class isn't "certified" yet, though.  In the U.S. legal system, a judge has to certify that the proposed class meets certain requirements.  That stage of the litigation is still a few months away.
by Steve Schwarz on Wed Jun 20th, 2007 at 11:51:04 AM EST
[ Parent ]
Could you drop the PDF by email here: laurent@guerby.net

I'll put on my web site so it can be linked from eurotrib.

Thanks in advance,


by Laurent GUERBY on Wed Jun 20th, 2007 at 01:50:51 PM EST
[ Parent ]
by Laurent GUERBY on Thu Jun 21st, 2007 at 03:07:12 AM EST
[ Parent ]

Thanks for posting these.

Meanwhile the EU and US are close to reaching a "deal" on how the US can use the SWIFT data.  Here is a link to the Washington Post article which doesn't really say much about the terms of the deal.


The article is password protected, so here is the text:

EU, U.S. reach preliminary deal on SWIFT data: EU

By Ingrid Melander
Wednesday, June 20, 2007; 11:59 AM

BRUSSELS (Reuters) - The EU and the United States have reached a preliminary deal on how U.S. authorities can consult data from the international banking network SWIFT in anti-terror investigations, an EU spokesman said on Wednesday.

"We have a draft agreement," Friso Roscam Abbing, spokesman for EU Justice and Security Commissioner Franco Frattini said of an accord aimed at allaying European data privacy concerns.

Brian Smith, a Federal Protective Service guard at an FDA office in College Park, said some guards were ready to walk off their jobs this month after a contractor failed to pay them. There was a feeling of frustration, he says. (Wilfredo Lee -- Associated Press)



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"What I really hope is that we can conclude this in the next one or two weeks."

Roscam Abbing did not give details but said the deal included provisions on data protection. "Then it is for SWIFT and for the banks to do their share in informing in advance their customers about providing the data," he said.

U.S. officials could not confirm if a preliminary deal had been reached. One said: "The process for reaching a final deal is still ongoing."

EU and Belgian watchdogs said last year Brussels-based SWIFT broke privacy laws by letting the U.S. Treasury Department secretly consult its records in terrorism investigations after the September 11, 2001 attacks on the United States.

SWIFT, which handles global financial transfers, is a cooperative owned by roughly 7,800 financial institutions in the more than 200 countries that use it. It says it was bound to obey a U.S. subpoena to transfer the data.

A spokesman for SWIFT said the company, which does not take part in the talks, could comment only when it sees the details of a final deal.

SWIFT announced last week it had decided to modify its messaging architecture to ensure that intra-European data be stored only in Europe, and not in the United States. It said it hoped that would allay data privacy concerns.

SWIFT's board is due to approve final details of that plan in September, said Euan Sellar, spokesman for SWIFT.

Brussels and Washington are also in talks to replace an interim deal on the transfer to the United States of private data on transatlantic air passengers.

Roscam Abbing said there remained political and technical issues to be solved and the EU hoped for a deal by the end of the month.

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© 2007 Reuters

by Steve Schwarz on Thu Jun 21st, 2007 at 10:14:54 AM EST
[ Parent ]
by Jerome a Paris (etg@eurotrib.com) on Thu Jun 21st, 2007 at 12:23:13 PM EST
[ Parent ]
So ... anyone who doesn't use food stamps or live chickens? Or am I misunderstanding the word "financial"?
by Number 6 on Wed Jun 20th, 2007 at 11:23:13 AM EST
[ Parent ]
What about foreign individuals? Should we initiate our own lawsuits in our local jurisdictions? What if we have been involved in bank transactions with US banks? (I happen to still have an active US checking account which I opened in 2000 and I have made international transfers to it since I left in 2004)

Can the last politician to go out the revolving door please turn the lights off?
by Migeru (migeru at eurotrib dot com) on Wed Jun 20th, 2007 at 02:12:24 PM EST
[ Parent ]
If you email them to me (see my profile), I can post them on this site and provide you with a link.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Wed Jun 20th, 2007 at 05:03:03 PM EST
[ Parent ]
Thanks for this info.
Here in Belgium the case is buried, no news at all about it.

The struggle of man against tyranny is the struggle of memory against forgetting.(Kundera)
by Elco B (elcob at scarlet dot be) on Wed Jun 20th, 2007 at 07:22:37 AM EST
Can you remind us what's in the Belgian case?

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Wed Jun 20th, 2007 at 05:03:37 PM EST
[ Parent ]
But what's happening in Malta?

"The future is already here -- it's just not very evenly distributed" William Gibson
by ChrisCook (cojockathotmaildotcom) on Wed Jun 20th, 2007 at 07:21:16 PM EST
[ Parent ]
  • SWIFT is a Belgian based money transfer firm. Swift has more than 7,500 clients, most of them global financial institutions, 11 million transactions a day.

  • In July 2006 it was found that SWIFT breached  Belgan and EU privacy laws by secretly giving personal financial data to the US authorities since 5 years...euh...GWOT you know...

  • This was a major scandal in Belgium, but politicians said the EU had to handle this.

  • The EU said that the Belgian courts had to do something about.

  • The Belgian court said not to prosecute, and this without any motivation or explanation.

  • In december 2006 , the latest was heard about the case : European diplomats reached a compromis with USA authorities and SWIFT can continue to give certain data to the US.

Side-note: On 14/06/07 Swift announced a net profit of 25 million Euro(up from 8 the year before).

There was lot of noise around this case, but our cowardly politicians did nothing.
I checked all Belgian papers online : no news since dec.2006 about the case.

The struggle of man against tyranny is the struggle of memory against forgetting.(Kundera)

by Elco B (elcob at scarlet dot be) on Wed Jun 20th, 2007 at 08:13:28 PM EST
[ Parent ]
U.K.-based Privacy International has been pursuing this for a year by sending inquiries to many European countries.  See this link for the conclusions of the European privacy watchdog investigators:

http://www.privacyinternational.org/index.shtml?cmd[342][]=c-1-Financial+Surveillance&als[theme]=Financial%20Surveillance&conds[1][category.... ....]=Financial%20Surveillance

by Steve Schwarz on Thu Jun 21st, 2007 at 03:01:30 AM EST
Sorry, the full link doesn't work.  When you get to the PI homepage click on "Financial Surveillance" in the left column.
by Steve Schwarz on Thu Jun 21st, 2007 at 03:02:28 AM EST
[ Parent ]
by Laurent GUERBY on Thu Jun 21st, 2007 at 03:11:56 AM EST
[ Parent ]

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