WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA), Chairman of the Senate Select Committee on Intelligence, and John Thune (R-SD), ranking member of the Commerce Committee’s Subcommittee on Communications, Media and Broadband, led a group of 12 bipartisan senators to introduce the Restricting the Emergence of Security Threats that Risk Information and Communications Technology (RESTRICT) Act, legislation that will comprehensively address the ongoing threat posed by technology from foreign adversaries by better empowering the Department of Commerce to review, prevent, and mitigate information communications and technology transactions that pose undue risk to our national security.

“Today, the threat that everyone is talking about is TikTok, and how it could enable surveillance by the Chinese Communist Party, or facilitate the spread of malign influence campaigns in the U.S. Before TikTok, however, it was Huawei and ZTE, which threatened our nation’s telecommunications networks. And before that, it was Russia’s Kaspersky Lab, which threatened the security of government and corporate devices,” said Sen. Warner. “We need a comprehensive, risk-based approach that proactively tackles sources of potentially dangerous technology before they gain a foothold in America, so we aren’t playing Whac-A-Mole and scrambling to catch up once they’re already ubiquitous.”

“Congress needs to stop taking a piecemeal approach when it comes to technology from adversarial nations that pose national security risks,” said Sen. Thune. “Our country needs a process in place to address these risks, which is why I’m pleased to work with Senator Warner to establish a holistic, methodical approach to address the threats posed by technology platforms – like TikTok – from foreign adversaries. This bipartisan legislation would take a necessary step to ensure consumers’ information and our communications technology infrastructure is secure.”

The RESTRICT Act establishes a risk-based process, tailored to the rapidly changing technology and threat environment, by directing the Department of Commerce to identify and mitigate foreign threats to information and communications technology products and services.

In addition to Sens. Warner and Thune, the legislation is co-sponsored by Sens. Tammy Baldwin (D-WI), Deb Fischer (R-NE), Joe Manchin (D-WV), Jerry Moran (R-KS), Michael Bennet (D-CO), Dan Sullivan (R-AK), Kirsten Gillibrand (D-NY), Susan Collins (R-ME), Martin Heinrich (D-NM), and Mitt Romney (R-UT).

The Restricting the Emergence of Security Threats that Risk Information and Communications Technology (RESTRICT) Act would:

• Require the Secretary of Commerce to establish procedures to identify, deter, disrupt, prevent, prohibit, and mitigate transactions involving information and communications technology products in which any foreign adversary has any interest and poses undue or unacceptable risk to national security;
• Prioritize evaluation of information communications and technology products used in critical infrastructure, integral to telecommunications products, or pertaining to a range of defined emerging, foundational, and disruptive technologies with serious national security implications;
• Ensure comprehensive actions to address risks of untrusted foreign information communications and technology products by requiring the Secretary to take up consideration of concerning activity identified by other government entities;
• Educate the public and business community about the threat by requiring the Secretary of Commerce to coordinate with the Director of National Intelligence to provide declassified information on how transactions denied or otherwise mitigated posed undue or unacceptable risk.

“We need to protect Americans’ data and keep our country safe against today and tomorrow’s threats. While many of these foreign-owned technology products and social media platforms like TikTok are extremely popular, we also know these products can pose a grave danger to Wisconsin’s users and threaten our national security,” said Sen. Baldwin. “This bipartisan legislation will empower us to respond to our fast-changing environment – giving the United States the tools it needs to assess and act on current and future threats that foreign-owned technologies pose to Wisconsinites and our national security.”

“There are a host of dangerous technology platforms – including TikTok – that can be manipulated by China and other foreign adversaries to threaten U.S. national security and abuse Americans’ personal data. I’m proud to join Senator Warner in introducing bipartisan legislation that would put an end to disjointed interagency responses and strengthen the federal government’s ability to counter these digital threats,” said Sen. Fischer.

“Over the past several years, foreign adversaries of the United States have encroached on American markets through technology products that steal sensitive location and identifying information of U.S. citizens, including social media platforms like TikTok. This dangerous new internet infrastructure poses serious risks to our nation’s economic and national security,” said Sen. Manchin. “I’m proud to introduce the bipartisan RESTRICT ACT, which will empower the Department of Commerce to adopt a comprehensive approach to evaluating and mitigating these threats posed by technology products. As Chairman of the Senate Armed Services Subcommittee on Cybersecurity, I will continue working with my colleagues on both sides of the aisle to get this critical legislation across the finish line.”

“Foreign adversaries are increasingly using products and services to collect information on American citizens, posing a threat to our national security,” said Sen. Moran. “This legislation would give the Department of Commerce the authority to help prevent adversarial governments from introducing harmful products and services in the U.S., providing us the long-term tools necessary to combat the infiltration of our information and communications systems. The government needs to be vigilant against these threats, but a comprehensive data privacy law is needed to ensure Americans are able to control who accesses their data and for what purpose.”

“We shouldn’t let any company subject to the Chinese Communist Party’s dictates collect data on a third of our population – and while TikTok is just the latest example, it won’t be the last. The federal government can’t continue to address new foreign technology from adversarial nations in a one-off manner; we need a strategic, enduring mechanism to protect Americans and our national security. I look forward to working in a bipartisan way with my colleagues on the Senate Select Intelligence Committee to send this bill to the floor,” said Sen. Bennet.

“Our modern economy, communication networks, and military rely on a range of information communication technologies. Unfortunately, some of these technology products pose a serious risk to our national security,” said Sen. Gillibrand. “The RESTRICT Act will address this risk by empowering the Secretary of Commerce to carefully evaluate these products and ensure that they do not endanger our critical infrastructure or undermine our democratic processes.”

“China’s brazen incursion of our airspace with a sophisticated spy balloon was only the most recent and highly visible example of its aggressive surveillance that has targeted our country for years.  Through hardware exports, malicious software, and other clandestine means, China has sought to steal information in an attempt to gain a military and economic edge,” said Sen. Collins. “Rather than taking a piecemeal approach to these hostile acts and reacting to each threat individually, our legislation would create a wholistic, government-wide response to proactively defend against surveillance attempts by China and other adversaries.  This will directly improve our national security as well as safeguard Americans’ personal information and our nation’s vital intellectual property.”

"Cybersecurity is one of the most serious economic and national security challenges we face as a nation. The future of conflict is moving further away from the battlefield and closer to the devices and the networks everyone increasingly depends on. We need a systemic approach to addressing potential threats posed by technology from foreign adversaries. This bill provides that approach by authorizing the Administration to review and restrict apps and services that pose a risk to Americans’ data security. I will continue to push for technology defenses that the American people want and deserve to keep our country both safe and free,” said Sen. Heinrich.

“The Chinese Communist Party is engaged in a multi-generational, multi-faceted, and systematic campaign to replace the United States as the world’s superpower. One tool at its disposal—the ability to force social media companies headquartered in China, like TikTok’s parent company, to hand over the data it collects on users,” said Sen. Romney. “Our adversaries—countries like China, Russia, Iran—are increasingly using technology products to spy on Americans and discover vulnerabilities in our communications infrastructure, which can then be exploited. The United States must take stronger action to safeguard our national security against the threat technology products pose and this legislation is a strong step in that direction.”

A two-page summary of the bill is available here. A copy of the bill text is available here.

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WASHINGTON – U.S. Sen. Mark R. Warner (D-VA), Chairman of the Senate Intelligence Committee, released the following statement on the President’s National Cyber Strategy:

“I’m pleased to see the Biden Administration advocating for the kind of best practices that I’ve long called for, such as building and reinforcing strong partnerships with the private sector, investing in the long-term protection of our nation’s critical infrastructure, being proactive about establishing strong cybersecurity foundations and meeting critical standards. I’m particularly pleased to see the Administration prioritize the coordination of cyber incident reporting requirements, as required by the cyber reporting law I was proud to author. I’m also glad to see the Administration’s renewed focus on protecting the sensitive medical data and safety of Americans as cyber attacks on our health care systems become more frequent and aggressive.”

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WASHINGTON – Yesterday, Chairman of the Senate Select Committee on Intelligence U.S. Sen. Mark R. Warner (D-VA) was joined by Committee Vice Chair Sen. Marco Rubio (R-FL) for a joint interview on CBS’s Face the Nation, where the Senators discussed the Committee’s bipartisan oversight efforts and how the U.S. needs to tackle the rising threats posed by the Communist Party of China.  

On the need for access to classified material found in the residences of Presidents Trump and Biden:

“This committee has had a long bipartisan history of doing its job. And our job here is intelligence oversight. The Justice Department has had the Trump documents about six months, the Biden documents about three months, our job is not to figure out if somebody mishandled those, our job is to make sure there's not an intelligence compromise. And while the Director of National Intelligence had been willing to brief us earlier, now that you've got the special counsel, the notion that we're going to be left in limbo, and we can't do our job, that just cannot stand. And every member of the committee who spoke yesterday and I wanted the director to hear this, regardless of party said, we are united in we have to find a way to do our job. That means we need these documents, we need that assessment.”—U.S. Sen. Mark R. Warner

On the Intelligence Committee’s priorities:  

“I actually think if there's one issue that still is extraordinarily bipartisan, it is a growing concern about China, and a recognition that in this technology race, second place is not good enough for us.” —U.S. Sen. Mark R. Warner

On TikTok:

“I want to have an approach that says, we need to look at foreign technology investments, foreign technology development, regardless of country, if it poses a national security threat and have some place that can evaluate this. We need a frame to systemically look at this… 138 million users in America use TikTok on a regular basis. Average about 90 minutes a day. The fact is, the algorithms that determine what you see on TikTok is determined out of Beijing by China. And the proof is, if you look at what Chinese kids are seeing on their version of TikTok, which emphasizes science and engineering, versus what our kids and the kids around the world are seeing, it is dramatically different. So, both from a data collection and from, frankly, a propaganda tool, it is of huge concern.” —U.S. Sen. Mark R. Warner

On social media regulation:

“I've been saying for years, and we may not fully agree on this, but on all these social media companies, a lot of good, but there is a dark under belly. And the fact that the United States historically, we would have set some rules of the road for these entities in terms of standards, in terms of protocols, in terms of appropriate behavior, in terms of questions like even like basic privacy. But our failure to do so has mean we have ceded that leadership, oftentimes to the Europeans, or to individual states, and I think that's, frankly, a loss of American leadership.” —U.S. Sen. Mark R. Warner

Video of Sen. Warner and Sen. Rubio’s full interview on Face the Nation can be found here. A transcript follows.

CBS’s Face the Nation

MARGARET BRENNAN: Do you have any timeline in terms of when you will get visibility into the documents of classified material that both President Biden and President Trump had in their residences?

SENATOR MARK WARNER: Margaret, unfortunately, no. And this committee has had a long bipartisan history of doing its job. And our job here is intelligence oversight. The Justice Department has had the Trump documents about six months, the Biden documents about three months. Our job is not to figure out if somebody mishandled those, but our job is to make sure there's not an intelligence compromise.

And while the director of national intelligence had been willing to brief us earlier, now that you've got the special counsel, the notion that we're going to be left in limbo, and we can't do our job, that just cannot stand.

BRENNAN: But the intelligence community would say their hands are tied, because this is an ongoing, active Justice Department investigation.

So what would meet the level of -- of addressing your concerns without compromising that?

SENATOR MARCO RUBIO: Well, I don't know how congressional oversight on the documents, actually knowing what they are in any way impedes an investigation.

These are probably materials we already have access to. We just don't know which ones they are. And it's not about being nosy. You know, the -- here's the bottom line. If, in fact, those documents were very sensitive, materials were sensitive, and they pose a counterintelligence or national security threat to the United States, then the intelligence agencies are tasked with the job of coming up with ways to mitigate that.

BRENNAN: Does the director even know what the materials were?

SEN. WARNER: Well, we got a bit of vagueness on that, because, again, I believe you want to make sure the intelligence professionals and not political appointees were making some of that.

That makes sense to me. But I would even think that, if the -- President Trump and President Biden would probably want to have this known, if they say there's no there there. Well, there may still be violations on handling.

SEN. RUBIO: Let me tell you how absurd this is.

There isn't a day that goes by that there isn't some media report about what was found where, what -- some sort of characterization of the material in the press. So, somehow, the only people who are not allowed to know what was in there are congressional oversight committees.

So, it's an untenable situation that I think has to be resolved.

BRENNAN: The idea that some of these documents go all the way back to when President Biden was a senator, does that suggest that there's something more than a problem in the executive branch?

SEN. WARNER: Agreed. That's why the notion of, we're not going to give the Oversight Committee the ability to do its job until the special prosecutor somehow says it's OK doesn't -- doesn't hold water. We have a right, as not only members of the Intelligence Committee, but as part of the leadership, to read virtually every classified document. We got a problem in terms of both classification levels, how senior elected officials, when they leave government, how they handle documents. We've had too many examples of this.

And, again, I think we've got the bipartisan bona fides to say, let's put them in place on a going-forward basis, a better process.

BRENNAN: So, you -- you threatened to withhold some funding to some of the agencies yesterday.

SEN. RUBIO: I'm not in the threat business right now.

But we certainly are -- there are things we need to do as a committee every year to authorize the moving around of funds. I think the director of national intelligence and other heads of intelligence agencies are aware of that.

You know, at some point, I would prefer for them just to call us this morning or tomorrow or whenever and say, look, this is the arrangement that we think we can reach, so that the overseers can get access to this. I would prefer not to go down that road. But it's one of the pieces of leverage we have as Congress.

SEN. WARNER: We're going to figure out a way to make sure that we get that access, so that we can not only tell the American people, but we've got another 85 U.S. senators who are not on the Intelligence Committee who look to us to get those assurances.

BRENNAN: What is it that you, as lawmakers, can do? Is it new regulations when it comes to transitions?

SEN. WARNER: The director of national intelligence is the individual that's the chief officer for intelligence classification.

I think -- and there's been a number of other members of the Senate, both parties, have been working for years on the notion that we overclassify.

BRENNAN: Right.

SEN. WARNER: The number of things that we read in a SCIF that somehow then appear in the newspaper begs the question.It's kind of been an issue that's been bubbling for a long time.

BRENNAN: Overclassification.

SEN. WARNER: I think that this -- I think this series of events pushes it to the forefront.

And, again, we have the power to write legislation, which then executive agencies have to follow.

BRENNAN: In terms of record-keeping.

SEN. WARNER: In terms of record-keeping, in terms, literally, of at least guidance on classification issues. I mean, there has been -- and again, this director of national intelligence, I'm going to give her credit. She has been at least acknowledging and, long before this issue came up, said, we need to work on this issue of declassification, overclassification. Every director says it, and then it kind of gets pushed -- pushed back. I think one good thing that may come out of this is that we're going to find a way to resolve this issue on a going-forward basis.

BRENNAN: Welcome back to FACE THE NATION. For all the division on Capitol Hill, one subject that invites at least some bipartisan unity is the threat posed by China. For more, we return to our interview with the leaders of the Senate Intelligence Committee, Mark Warner and Marco Rubio.

BRENNAN: President Biden is reportedly close to issuing an executive order when it comes to restrictions on U.S. investments in - in China. But there's concern about risking further escalation. What's your view on how far that action should go?

SEN. RUBIO: The Chinese have found a way to use capitalism against us and a - and what I mean by that is the ability to attract investment into entities that are deeply linked to the state. The military commercial fusion that exists in China is a concept that we don't have in this country. We have contractors that do defense work, but there is no distinction in China between advancements in technology, biomedicine, whatever it might be, and the interest of the state.

And then the second is, obviously, the access to our capital markets.

And the third is the risk posed. We don't, up to this point, have not had levels of transparency in terms of auditing and the like on these investments of the -- into these companies. When you invest in these companies and U.S. exchanges, you don't have nearly as much information about the bookkeeping of those companies as you would an American company or a European company because they refuse to comply with those restrictions. So, there's systemic risk to our investments and then there's also the geopolitical reality that American capital flows are helping to fund activities that are ultimately designed to undermine our national security.

SEN. WARNER: Beginning of the 20th century, I was a believer that, you know, the more you bring China into the world order, the more things will all be copacetic.

BRENNAN: Right.

SEN. WARNER: We were just wrong on that. The communist party, under President Xi's leadership, and my beef is, to be clear, with the communist party, it's not with the Chinese people or the Chinese (INAUDIBLE), wherever it is in the world, but they basically changed the rules of the road. They made clear, in Chinese law, that every company in China's ultimate responsibility is to the communist party. Not that their customers. Not to their shareholders.

We have actually, in a bipartisan way, did over -- didn't get a lot of attention, over the last seven years, have been out and we've done 20 classified briefings for industry sector after industry sector about these risks. Frankly, pre-Covid, we kind of got nods.

BRENNAN: Right.

SEN. WARNER: But, you know, some pushback because a lot of companies were making - were making –

BRENNAN: Because companies just wanted access to the market regardless of the risk.

SEN. WARNER: Were making a lot of money off Chinese tech companies.

BRENNAN: Exactly. Exactly.

SEN. WARNER: Now, post-Covid, I think there is an awakening that this is a real challenge. And I think the good news is that not only is there an awakening, you know, in America, but a lot of our allies around the world are seeing this threat as well.

SEN. RUBIO: I - I think there was a -

BRENNAN: So you want restrictions on biotech, battery technologies, semiconductors, artificial intelligence?

SEN. WARNER: I want to have an approach that says, we need to look at foreign technology investments, foreign technology development, regardless of country, if it poses a national security threat and have some place that can evaluate this. We need a frame to systemically look at this. And, frankly, if it goes just beyond the so-called CFIUS legislation about inbound or outbound investment.

BRENNAN: That's a committee looks at the national security risk.

SEN. RUBIO: But understanding that for, you know, 20 years ago everybody thought capitalism was going to change China. And we woke up to the realization that capitalism didn't change China, China changed capitalism. And they've used it to their advantage and to our disadvantage. And not simply from an old Soviet perspective to take us on from a geopolitical or military perspective, they've done so from a technological and industrial perspective. And so you have seen the largest theft and transfer of intellectual property in the history of humanity occur over the last 15 years. Some of it funded by American taxpayers.

BRENNAN: They have the biggest hacking ability program than any other nation. The intelligence community says they're the world leader in surveillance, in censorship. How restricted should their ability to access this market be?

SEN. RUBIO: I think it is nearly impossible for any Chinese company to comply with both Chinese law and our expectations in this country. Chinese law is very clear, if you're a Chinese company and we ask you for your data, we ask you for your information, we ask you for what you have or we ask you to do something, you either do it or you won't be around.

BRENNAN: You want to ban Chinese companies from investing in America?

SEN. RUBIO: Well, I think there are certain investments where there's no way we can protect the country from doing it. Do you - you know, we go back to TikTok, people say, who - you know, why do we care about what some 16- year-olds are doing.

BRENNAN: Right.

SEN. RUBIO: I don't think the threat is that some 16-year-old likes these cool videos that are on there, which I admit are - are attractive, obviously, because of the artificial intelligence makes it so. It's the massive amount of data that they're collecting, not on one 16-year-old, not on 1,000 16-year-olds, but on millions and millions of Americans that give them commercial advantage, potentially the advantage of being able to shape American public opinion in a time of crisis, that - that just give them extraordinary insights that allow them to steer the conversation in this country in any direction they want.

BRENNAN: But this has been talked about for three years now.

SEN. WARNER: But - but let's -

BRENNAN: The Trump administration tried to ban it. The Biden administration still hasn't pulled the trigger.

SEN. WARNER: Maybe we were all a little bit slow to recognize the challenge here. You know, it is both a data collection entity. Now, it may not collect as much data as some of our American platforms, but it is very much, at the end of the day, still responsible to the communist party.

But think about this, Margaret, 138 million users in America use TikTok on a regular basis. Average about 90 minutes a day. The fact is, the algorithms that determine what you see on TikTok is determined out of Beijing by China.

And the proof is, if you look at what Chinese kids are seeing on their version of TikTok, which emphasizes science and engineering, versus what our kids and the kids around the world are seeing, it is dramatically different. So, both from a data collection and from, frankly, a propaganda tool, it is of huge concern.

BRENNAN: Yes. CBS spoke to TikTok about their plans and the company said they had come to an agreement over the summer in terms of how they could structure things to separate and create a wall to protect against some of these concerns. They said they can continue operating in the U.S. by offering data protections.

Do you both know what they are offering. And you're laughing so I'm guessing this isn't sufficient?

SEN. RUBIO: I don't know what the data protections are. And there's a technical aspect to it. But it's beyond the data protections. I filed a bill to ban it last year.

BRENNAN: Right.

SEN. RUBIO: We're going to re-file it again this year.

BRENNAN: You are?

SEN. RUBIO: It's bipartisan. It's bicameral. Some people are not willing to go that far, but I certainly think it's the right place to be. But, in the end, we've got to do something about it, whether it's a ban or something else.

I - I honestly don't know - I -- as I sit here with you today, I don't know how our national security interests and the operation of TikTok in this country, as long as it's owned by ByteDance, can coexist.

SEN. WARNER: And I'm - and - and --

BRENNAN: You want to force the sale?

SEN. RUBIO: I - I want -- I've been wanting to do that for three years.

SEN. WARNER: I may have a slightly different approach. I'm going to sit down and see how we can work through this. But I've been hearing - and I've been trying to give the Biden administration now more than two years to see, is there a technical solution here? And I'd be willing to take a look at it.

The Biden administration has not announced that. And I think the problem is, this is technically extraordinarily hard to do. TikTok has repeatedly said, oh, America's data, not being seen in China. And repeatedly we've seen Chinese engineers having access to American data.

BRENNAN: But it's already been downloaded 200 million times.

SEN. WARNER: This is -

BRENNAN: How do you convince a 16-year-old to delete the app and get rid of the phone? I mean is -- isn't this very hard to put the toothpaste back in the tube?

SEN. WARNER: This is - this - this -- absolutely. But this is one of the reasons why I think Congress has been horribly unsuccessful at this. I've been saying for years, and we may not fully agree on this, but on all these social media companies, a lot of good, but there is a dark under belly. And the fact that the United States historically, we would have set some rules of the road for these - for these entities in terms of standards, in terms of protocols, in terms of appropriate behavior, in terms of questions like even like basic privacy.

SEN. BRENNAN: Right.

SEN. WARNER: But our failure to do so has mean we have ceded that leadership, oftentimes to the Europeans, or to individual states, and I think that's, frankly, a loss of American leadership.

You know, for most of my lifetime we led virtually in every innovation area. We suddenly woke up with, you know, 5G or wireless communication where China was, you know, setting the standards. We - we woke up an industry like semiconductor chips and woke up -

BRENNAN: Yes.

SEN. WARNER: We used to own this and we've lost it. We've seen now the solar industry where it's all migrated to China.

If -- think about, you know, this notion around quantum computing, the ability to break any kind of encryption, or artificial intelligence, those technologies are driven by an authoritarian regime out of China. You know, I don't care where you fall on the political spectrum in America, that's not good news or for free people anywhere in the world.

BRENNAN: Aren't you - aren't you going to run head long into business interests here in the United States? I mean just look at Elon Musk. The U.S. government relies on his company SpaceX. He has a majority in car company Tesla. He has control over the internet connection in Ukraine via Starlink. And he now owns Twitter.

You said there's no one in the world more dependent on the communist party than Elon Musk.

SEN. WARNER: Exactly (ph). My concern is, you know, if you look at Mr. Musk's public statements, they're almost all supportive of the oversight regime in China, and they're almost all derogatory about the oversight regime in America and in Europe.

And part of that, I think, whether it's knowingly or not, is, where does he get all his batteries that go into all these Teslas? They are, you know, built in China, mostly, frankly, with a lot of Uyghur labor. And Senator Rubio has been the leader on trying to make sure that the Chinese communist party's treatment of the Uyghur people is prohibited. And, you know, I've yet to hear from Mr. Musk how that kind of contradiction about comments about the CCP in China and what he's dealing with Uyghur labor, how that's not going to influence some of his decisions.

SEN. RUBIO: It goes beyond Elon Musk. I mean business interests have invested, both in access to the Chinese market, but also in the means of production. And it's allowed them, in many cases, historically, to be deputized, include - and that includes the finance and investment world -- to come to Washington and argue for things that are against the national interest but in favor of their short and midterm profit line for their investors for their company.

BRENNAN: Senator Rubio, as a conservative you have to feel a little bit uncomfortable with talking about government intervention in private industry. But that has been the U.S. solution in some ways to the semiconductor issues you were raising, the subsidy, to try to bring chip making back to America.

SEN. RUBIO: Well, I would argue this, that I don't believe in government intervention in the private sector, but I do believe in government intervention in our national security. So, capitalism --

BRENNAN: These are subsidies.

SEN. RUBIO: Well, so capitalism is going to give you the most efficient outcome. But sometimes what do you do when the most efficient outcome is not in our national interest, because it's more efficient to buy rare earth minerals from the Chinese, it's more efficient to have things built over there in many cases, but is it in our national interest to depend on them for 80 something percent of the active ingredients in our pharmaceuticals? I could argue it was not. And in those instances, where the market efficient outcome is not in our national interest, it is my opinion that we default to the national interests because without our national interests and our national security, the other things won't matter.

We are not a market. We're a nation. And the market exists to serve the market, not the nation to serve the market.

BRENNAN: The $50 billion that taxpayers just pumped into to the chips bill and semiconductors, that's just the start. That you think other legislation is coming like that?

SEN. WARNER: I'm saying - what I'm saying is we need - you know, one of the reasons that it took us $52 billion and that was for most semiconductors and next generation wireless, was because candidly I think we went asleep at the switch for a long time and we had to suddenly play catch-up because we'd seen China advance and we had also seen Taiwan, our friend and one of the reasons why we need to be supportive, where, frankly, every advanced chip in all of our satellites and - and sea craft are made in Taiwan.

We were chasing after the fact. If we can get ahead on - on some of these key areas, I don't think we will need that kind of investment. But we are going to need to make sure that we've got a plan in place to make sure that these new technology domains don't all end up in China.

SEN. RUBIO: We need to identify, what are the critical industries and capacities that our country needs to be able to have without being leveraged or having to go through the Chinese to get it. And then we need to figure out what government's role is.

Now, I want to make sure that we're not turning this into a lobbyist trial where every industry comes here and gets money. And we have to make sure that if we're going to invest in research, that that research is protected, that there's sufficient safeguards, because what's the point of putting billions of dollars to innovate something they're going to steal anyway?

But I do think, again, this is not about government running or owning these companies. We're not going to rely on the Chinese or someone else to make it for us because we'll be denied that capability in a time of conflict.

BRENNAN: Can you get that through a divided Congress?

SEN. WARNER: I actually think if there's one issue that still is extraordinarily bipartisan, it is a growing concern about China and a recognition that in this technology race, second place is not good enough for us.

BRENNAN: We actually haven't had a bipartisan interview like this in about three years. So, to see a Democrat and a Republican sit down and talk about issues of substance is great to see.

SEN. WARNER: Thank you.

BRENNAN: Thank you both.

BRENNAN: We'll be right back.

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Earlier this month, Apple publicly acknowledged that it is considering procuring NAND memory chips for future iPhones from Yangtze Memory Technologies Co. (YMTC), a state-owned company with extensive links to the Chinese Communist Party (CCP) and its armed wing, the People’s Liberation Army (PLA). 

U.S. Sens. Mark R. Warner (D-VA) and Marco Rubio (R-FL), Chairman and Vice Chairman of the U.S. Senate Select Committee on Intelligence, sent a letter to U.S. Director of National Intelligence Avril Haines calling for a public analysis and review of YMTC and the risks it presents to U.S. national security. 

• “[W]e write to convey that any decision to partner with YMTC, no matter the intended market of the product offerings developed by such a partnership, would affirm and reward the PRC’s distortive and unfair trade practices, which undermine U.S. companies globally by creating significant advantages to Chinese firms at the expense of foreign competitors. Last year, the Biden Administration described YMTC as China’s ‘national champion memory chip producer,’ which supports the CCP’s efforts to counter U.S. innovation and leadership in this space.” 

• “Policymakers have for several years now conveyed to the American public the importance of a competitive semiconductor industry to U.S. national and economic security. A partnership between Apple and YMTC would endanger this critical sector and risk nullifying efforts to support it, jeopardizing the health of chipmakers in the U.S. and allied countries and advancing Beijing’s goal of controlling the global semiconductor market. Buoyed by a major contract with a leading global equipment vendor such as Apple, YMTC’s success would threaten the 24,000 American jobs that support memory chip production. More broadly, such a partnership would also threaten the opportunities this market provides for research at U.S. universities and further development of memory chips for civilian and military uses.”

Majority Leader Chuck Schumer (D-NY) and Senator John Cornyn (R-TX) also signed the letter.

Full text of the letter is available here and below. 

Dear Director Haines:

We write to convey our extreme concern about the possibility that Apple Inc. will soon procure 3D NAND memory chips from the People’s Republic of China (PRC) state-owned manufacturer Yangtze Memory Technologies Co. (YMTC). Such a decision would introduce significant privacy and security vulnerabilities to the global digital supply chain that Apple helps shape given YMTC’s extensive, but often opaque, ties to the Chinese Communist Party (CCP) and concerning PRC-backed entities. In addition, we write to convey that any decision to partner with YMTC, no matter the intended market of the product offerings developed by such a partnership, would affirm and reward the PRC’s distortive and unfair trade practices, which undermine U.S. companies globally by creating significant advantages to Chinese firms at the expense of foreign competitors. Last year, the Biden Administration described YMTC as China’s “national champion memory chip producer,” which supports the CCP’s efforts to counter U.S. innovation and leadership in this space. 

In July 2022, we wrote to Commerce Secretary Gina Raimondo to warn of the threat YMTC poses to U.S. national security and to request that it be added to the Bureau of Industry and Security’s Entity List. We made these arguments based on the company’s central role in CCP efforts to supplant U.S. technological leadership, including through unfair trade practices. YMTC also appears to have strong ties to the PRC’s military-civil fusion program, as shown through its investors and partnerships; its parent company, Tsinghua Unigroup, allegedly supplies the PRC military.

The PRC has heavily subsidized YMTC for several years, enabling the company to rapidly expand production and sales in China and internationally. Since its formation in 2016, YMTC’s nearly $24 billion in PRC subsidies triggered explosive growth, helping to prepare the company’s plan to launch a second plant in Wuhan as early as the end of this year. At a time when overcapacity is potentially disrupting the market for chipmakers, these subsidies could enable YMTC to distort this often highly cyclical market, selling memory chips below cost in an effort to push out competitors. In addition, in April, reports alleged that YMTC may have breached the U.S.’s foreign direct product rule for supplying smartphone and electronics components to Huawei.

For these reasons, we request that you coordinate among the relevant intelligence community (IC) components a comprehensive review and analysis of YMTC and the threat that a suppler partnership arrangement between it and Apple would pose to U.S. national and economic security. The review should consider, among other issues:

• How the CCP supports the YMTC as part of its plan to bolster and indigenize China’s semiconductor industry and to displace chipmakers from the United States and allied and partnered nations;
• YMTC’s role in assisting other Chinese firms, including Huawei, to evade U.S. sanctions;
• YMTC’s role in the PRC’s military-civil fusion program and its linkages to the People’s Liberation Army; and
• The risks to U.S. national and economic security of this potential procurement.

Policymakers have for several years now conveyed to the American public the importance of a competitive semiconductor industry to U.S. national and economic security. A partnership between Apple and YMTC would endanger this critical sector and risk nullifying efforts to support it, jeopardizing the health of chipmakers in the U.S. and allied countries and advancing Beijing’s goal of controlling the global semiconductor market. Buoyed by a major contract with a leading global equipment vendor such as Apple, YMTC’s success would threaten the 24,000 American jobs that support memory chip production. More broadly, such a partnership would also threaten the opportunities this market provides for research at U.S. universities and further development of memory chips for civilian and military uses.

We once again request that you convene the relevant IC components to review and assess YMTC’s ties to the CCP and produce a comprehensive public report on YMTC, which can be used to inform federal agencies and the public as to the nature and risks associated with YMTC and similar companies.  

We look forward to your attention to this critical matter and request a response by October 1, 2022.

Sincerely,

###

WASHINGTON – Today, on the 21^st anniversary of the September 11^th terrorist attacks, U.S. Sen. Mark R. Warner (D-VA), appeared on CBS’s Face the Nation to discuss evolving threats facing our country as well the recent request by the Intelligence Committee to assess the damage of the classified documents potentially mishandled by former President Trump.

On the national security threats facing our country:

“The stunning thing to me is, here we are 20 years later and the attack on the symbol of our democracy is not coming from terrorists but it came from literally insurgents attacking the Capitol on January 6th. So, I believe we are stronger. I believe our Intelligence Community has performed remarkably. I think the threat of terror has diminished, but I still think we have new challenges in terms of nation and state challenges, Russia and longer term a technology competition with China. But I do worry about some of the activity in this country, the election deniers, the insurgency that took place on January 6th. That is something I hope we can see that same kind of unity of spirit.”

On the Intelligence Committee request for a damage assessment of the classified documents potentially mishandled by former President Trump:

“The vice chairman and I have asked for a briefing of the damages that could have arisen from mishandling of this information. And I believe it's our congressional duty to have that oversight. Remember, what's at stake here is the fact that if some of these documents involved human intelligence, and that information got out, people will die. If there were penetration of our signals intelligence, literally years of work could be destroyed. We talk about the enormous advances our Intelligence Community has made helping our Ukrainian friends. That comes about because we share intelligence. If there's intelligence that has been shared with us by allies and that is mishandled, all of that could be in jeopardy.”

Video of Sen. Warner’s interview on Face the Nation can be found here. A transcript follows.

CBS’s Face the Nation

MARGARET BRENNAN: We begin with the Chairman of the Senate Intelligence Committee, Mark Warner of Virginia. Good morning to you, Senator. 9/11 introduced to many Americans for the very first time this sense of vulnerability at home and it launched the global war on terror. I wonder how vulnerable you think America is now. Are we paying enough attention to the Middle East and to Afghanistan?

SEN. MARK WARNER: Well Margaret, I remember, as most Americans do, where they were on 9/11. I was in it is middle of a political campaign and suddenly the differences with my opponent seemed very small in comparison, and our country came together. In many ways, we defeated the terrorists because of the resilience of the American public, because of our Intelligence Community—and we are safer, better prepared. The stunning thing to me is, here we are 20 years later and the attack on the symbol of our democracy is not coming from terrorists but it came from literally insurgents attacking the Capitol on January 6th. So, I believe we are stronger. I believe our Intelligence Community has performed remarkably. I think the threat of terror has diminished, but I still think we have new challenges in terms of nation and state challenges, Russia and longer term a technology competition with China. But I do worry about some of the activity in this country, the election deniers, the insurgency that took place on January 6th. That is something I hope we can see that same kind of unity of spirit.

BRENNAN: As you're pointing out, America came together after 9/11 and we are incredibly divided right now. One thing that is potentially quite explosive is this ongoing investigation by the Justice Department of the former president and his handling of classified information. You've asked for a briefing from the Intelligence Community. Given how sensitive this is, why should anything be shared with Congress given that this is an ongoing investigation?

SEN WARNER: Because as the Chairman of the Intelligence Committee, and I'm very proud of our committee, we're the last functioning bipartisan committee, I believe, in the whole Congress. The vice chairman and I have asked for a briefing of the damages that could have arisen from mishandling of this information. And I believe it's our congressional duty to have that oversight. Remember, what's at stake here is the fact that if some of these documents involved human intelligence, and that information got out, people will die. If there were penetration of our signals intelligence, literally years of work could be destroyed. We talk about the enormous advances our Intelligence Community has made helping our Ukrainian friends. That comes about because we share intelligence. If there's intelligence that has been shared with us by allies and that is mishandled, all of that could be in jeopardy. Now we don't know what's in those documents, but I think it is incumbent, as soon as we get approval -- let me be clear, as soon as we get approval, my understanding is there is some question because of the special master appointment by the judge in Florida, whether they can brief at this point. We need clarification on that from that judge as quickly as possible because it is essential that the Intelligence Community leadership at least gets a briefing of the damage assessment.

 BRENNAN: That damage assessment, it has been paused, as has the classification review, and it will take some time. So, A, I'm assuming in your answer there you're saying, there have been no promises of a briefing to be scheduled, is that right?

SEN. WARNER: I believe we will get a briefing as soon as there's clarification whether this can be performed or not in light of the ruling of the judge in Florida.

BRENNAN: Why should that happen? Because I want to get o something you said, which was the “last bipartisan committee”. You and Marco Rubio, your partner in this request for a briefing, put forth this letter asking for the damage assessment. But lately your colleague has been making some comments that don't sound quite as bipartisan. He's compared the Justice Department to corrupt regimes in Latin America when it comes to this investigation, he's accused DOJ of leaking sensitive details. He says the only reason to leak it is to create a narrative for political purpose. When information gets shared with Congress, as you know, the accusation is, it will get leaked. So, A, it looks like you're losing that bipartisanship and, B, if you brief Congress, isn't it going to leak further and worsen?

SEN. WARNER: The record of our Intelligence Committee of keeping secret, secret, that's why the Intelligence Community shares information with us. Remember, this was the committee bipartisan that did the Russia Investigation –

BRENNAN: But you know your oversight capability, many would argue, including former heads of counterintelligence, FBI, the line is drawn when it's an active investigation. They don’t owe you a briefing.

SEN. WARNER: We do not -- I do not want any kind of insight into an active investigation by the Justice Department. I do want the damage assessment of what would happen to our ability to protect the nation. Here we are 21 years after 9/11. If classified secrets, top secret secrets are somehow mishandled, I pointed out earlier, people could die, sources of intelligence could disappear, the willingness of our allies to share intelligence could be undermined, and I think we need that assessment to make sure –

BRENNAN: Which you will get, but it’s going to take some time.

SEN. WARNER: But I think we need it sooner than later.

BRENNAN: To that point, because it's so sensitive, because the country is so divided, because you already have in many ways a target being put on the back of law enforcement, isn't it more important to get it right, to be deliberate and not to be fast here? I want the details just as much as you do.

SEN. WARNER: Listen, I do not think we should have as the Intelligence Committee, a briefing on the ongoing investigation. What our responsibility is, is to assess whether there's been damage done to our intelligence collection and maintenance of secrets. That is a damage assessment that frankly, the judge in Florida has said can continue.

BRENNAN: Before November?

SEN. WARNER: Listen. Once we get clarification from the judge in Florida, and again, I don't think we can cherry-pick what part of the legal system we like or dislike. I have trust in our legal system. I may not agree with the decision the judge in Florida but I respect our Department of Justice. I respect the FBI. I think they are trying under extraordinarily difficult circumstances to get it right and we owe them the benefit of the doubt.

BRENNAN: Senator, thank you for coming on and I know we are going to continue to track this and any potential impact to national security. 

###

WASHINGTON – U.S. Sen. Mark R. Warner (D-VA), Chairman of the Senate Intelligence Committee, released the statement below after the Cybersecurity and Infrastructure Security Agency (CISA) announced a critical step in enacting a Warner-authored law that would require companies who are responsible for U.S. critical infrastructure to report cybersecurity incidents to the government. 

“I’m excited to see CISA move forward with implementing this cybersecurity law, which will help us counter the growing threat of cyberattacks against our institutions and allies. This is an important effort to shore up our nation’s information security and I’m glad to see CISA act with the urgency it merits. I encourage stakeholders to participate in this process and look forward to seeing CISA continue to move expeditiously to adopt these vital safeguards.”

Specifically, CISA announced a series of public listening sessions as well as a Request for Information (RFI) – both of which seek to collect input from the public in order to help develop proposed regulations required by the Cyber Incident Reporting for Critical Infrastructure Act of 2022.

###

WASHINGTON – Today, Senate Select Committee on Intelligence Chairman Mark R. Warner (D-VA) and Vice Chairman Marco Rubio (R-FL) urged the Federal Trade Commission (FTC) to formally investigate TikTok and its parent company, ByteDance. The call comes in response to recent reports that the social media platform has permitted TikTok engineers and executives in the People’s Republic of China (PRC) to repeatedly access private data of US users despite repeated claims to lawmakers and users that this data was protected. This includes instances where staff based in the United States had to consult with their China-based colleagues for information about U.S. user data as they did not have access to the data on their own. These revelations undermine longstanding claims by TikTok’s management that the company’s operations were firewalled from demands of the Chinese Communist Party.

“We write in response to public reports that individuals in the People’s Republic of China (PRC) have been accessing data on U.S. users, in contravention of several public representations, including sworn testimony in October 2021,” the senators wrote in a letter to FTC Chair Lina Khan. “In light of this new report, we ask that your agency immediately initiate a Section 5 investigation on the basis of apparent deception by TikTok, and coordinate this work with any national security or counter-intelligence investigation that may be initiated by the U.S. Department of Justice.”

The report also highlights TikTok’s misrepresentation of the company’s relationship to ByteDance and its subsidiaries, including Beijing-based ByteDance Technology, which is partially owned by the Chinese Communist Party (CCP). 

The senators continued, “TikTok’s Trust and Safety department was aware of these improper access practices and governance irregularities, which – according to internal recordings of TikTok deliberations – offered PRC-based employees unfettered access to user information, including birthdates, phone numbers, and device identification information. Recent updates to TikTok’s privacy policy, which indicate that TikTok may be collecting biometric data such as faceprints and voiceprints (i.e. individually-identifiable image and audio data, respectively), heighten the concern that data of U.S. users may be vulnerable to extrajudicial access by security services controlled by the CCP.”

As Chairman and Vice Chair of the Senate Select Committee on Intelligence, Sens. Warner and Rubio have been vocal about the cyber and national security threats posed by the CCP. In 2019, the senators introduced legislation to combat tech-specific threats to national security posed by foreign actors like China.

A copy of the letter is available here and below. 

Dear Chairwoman Khan:

We write in response to public reports that individuals in the People’s Republic of China (PRC) have been accessing data on U.S. users, in contravention of several public representations, including sworn testimony in October 2021. In an interview with the online publication Cyberscoop, the Global Chief Security Officer for TikTok’s parent company, ByteDance, made a number of public representations on the data security practices of TikTok, including unequivocal claims that the data of American users is not accessible to the Chinese Communist Party (CCP) and the government of the PRC. As you know, TikTok’s privacy practices are already subject to a consent decree with the Federal Trade Commission, based on its improper collection and processing of personal information from children. In light of this new report, we ask that your agency immediately initiate a Section 5 investigation on the basis of apparent deception by TikTok, and coordinate this work with any national security or counter-intelligence investigation that may be initiated by the U.S. Department of Justice.

Additionally, these recent reports suggest that TikTok has also misrepresented its corporate governance practices, including to Congressional committees such as ours. In October 2021, TikTok’s head of public policy, Michael Beckerman, testified that TikTok has “no affiliation” with another ByteDance subsidiary, Beijing-based ByteDance Technology, of which the CCP owns a partial stake. Meanwhile, as recently as March of this year, TikTok officials reiterated to our Committee representations they have previously made that all corporate governance decisions are wholly firewalled from their PRC-based parent, ByteDance. Yet according to a recent report from Buzzfeed News, TikTok’s engineering teams ultimately report to ByteDance leadership in the PRC. 

According to this same report, TikTok’s Trust and Safety department was aware of these improper access practices and governance irregularities, which – according to internal recordings of TikTok deliberations – offered PRC-based employees unfettered access to user information, including birthdates, phone numbers, and device identification information. Recent updates to TikTok’s privacy policy, which indicate that TikTok may be collecting biometric data such as faceprints and voiceprints (i.e. individually-identifiable image and audio data, respectively), heighten the concern that data of U.S. users may be vulnerable to extrajudicial access by security services controlled by the CCP.

A series of national security laws imposed by the CCP, including the 2017 National Intelligence Law and the 2014 Counter-Espionage Law provide extensive and extra-judicial access opportunities for CCP-controlled security services. Under these authorities, the CCP may compel access, regardless of where data is ultimately stored. While TikTok has suggested that migrating to U.S.-based storage from a U.S. cloud service provider alleviates any risk of unauthorized access, these latest revelations raise concerns about the reliability of TikTok representations: since TikTok will ultimately control all access to the cloud-hosted systems, the risk of access to that data by PRC-based engineers (or CCP security services) remains significant in light of the corporate governance irregularities revealed by BuzzFeed News. Moreover, as the recent report makes clear, the majority of TikTok data – including content posted by users as well as their unique IDs– will remain freely accessible to PRC-based ByteDance employees.

In light of repeated misrepresentations by TikTok concerning its data security, data processing, and corporate governance practices, we urge you to act promptly on this matter.

Sincerely, 

### 

WASHINGTON – In an effort to combat money laundering and sanctions evasion, a group of six Senate Committee Chairs including Sen. Mark Warner (D-VA), Chair of the Senate Intelligence Committee, sent a letter to the Treasury Department urging the agency to revise and reissue proposed rules from 2015 that would have imposed anti-money laundering (AML) and suspicious activity report filing requirements on investment advisers, including advisers to private equity funds and hedge funds.

Advisers to private funds have enjoyed an exemption from requirements to maintain AML programs, verify the identities of their customers, and report suspicious transactions to the U.S. government.  This exemption has made private funds a potentially attractive avenue for money launderers and sanctioned persons to hide their wealth, and the Senators urge Treasury to move as quickly as practicable to address this weakness in the AML system.

In addition to Sens. Warner and Jack Reed (D-RI), Chair of the Armed Services Committee and a leading Congressional champion for transparency and accountability for financial intuitions, the letter is signed by Sens. Sherrod Brown (D-OH), Chair of the Banking, Housing and Urban Affairs Committee; Ron Wyden (D-OR), Chair of the Finance Committee; Richard Durbin (D?IL), Chair of the Judiciary Committee; Bob Menendez (D-NJ), Chair of the Foreign Relations Committee.

“Requiring advisers to establish AML programs, report suspicious activity, and file currency transaction reports, among other requirements, would go a long way towards deterring [politically exposed Russians]—and other illicit actors—from using private equity funds, hedge funds, venture capital funds, credit funds, real estate funds, and other private pools of capital to enter the U.S. financial system.  Following Russia’s unprovoked invasion of Ukraine, the United States has worked with its allies and partners to find the assets of sanctioned Russian oligarchs. However, loopholes and vulnerabilities in our financial reporting laws have made it increasingly challenging for federal investigators to identify where oligarchs and other criminal actors are placing their assets.  Holding investment advisers to the same AML standards applicable to other financial institutions would help achieve this important national security objective,” the Senators wrote.

Full text of the letter is available here and below.  

We write to urge the Financial Crimes Enforcement Network (FinCEN) to revise and reissue, as necessary, proposed rules from 2015 on anti-money laundering (AML) and suspicious activity report filing requirements for investment advisers. In doing so, we urge FinCEN to use its discretionary authority to include investment advisers in the definition of “financial institution” in the Bank Secrecy Act (BSA), which would require them to file currency transaction reports and keep certain records related to the transmittal of funds. Finally, we urge FinCEN to work with the Securities and Exchange Commission (SEC) to ensure adequate examination of the industry for AML purposes.

Investment advisers are exempt from requirements to maintain AML programs, verify the identities of their customers, and report suspicious transactions to FinCEN. Other financial institutions like banks, broker-dealers, mutual funds, futures commission merchants, introducing brokers in commodities, and insurance companies, among others, have been subject to these requirements for decades. According to the SEC’s Investment Adviser Information Reports, during just the last ten years, assets under management attributed to registered investment advisers has ballooned from approximately $44 trillion to approximately $113 trillion, raising fresh questions of whether FinCEN should eliminate these special exemptions.

The private funds segment of the asset management industry may be particularly attractive for money launderers and sanctioned persons due to existing regulatory gaps. In an Intelligence Bulletin from May 2020, the FBI indicated with high confidence that “threat actors likely use private placement of funds, including investments offered by hedge funds and private equity firms, to launder money, circumventing traditional AML programs.” Press reports have confirmed the FBI’s assessment. According to an article in Buzzfeed, a prominent Russian oligarch has used opaque corporate structures to invest at least $1.3 billion with private funds managed by U.S. investment advisers. And according to the New York Times, this very same oligarch made up to 100 investments in hedge funds and private equity funds managed by the nation’s largest asset managers, which allegedly did not confirm the source of these funds.

While the largest advisers to private funds may voluntarily implement AML programs, those advisers are not subject to regular examinations to test the adequacy of their programs. No government agency currently holds advisers accountable for adhering to their voluntary AML and sanctions compliance commitments. By contrast, banks, broker-dealers, and insurance companies are subject to periodic examinations to spot violations of the BSA and any compliance weaknesses.

Last month, FinCEN issued an alert warning financial institutions to be vigilant against attempts by politically exposed Russians to launder money, evade sanctions, and hide their assets. Requiring advisers to establish AML programs, report suspicious activity, and file currency transaction reports, among other requirements, would go a long way towards deterring these individuals—and other illicit actors—from using private equity funds, hedge funds, venture capital funds, credit funds, real estate funds, and other private pools of capital to enter the U.S. financial system. Following Russia’s unprovoked invasion of Ukraine, the United States has worked with its allies and partners to find the assets of sanctioned Russian oligarchs. However, loopholes and vulnerabilities in our financial reporting laws have made it increasingly challenging for federal investigators to identify where oligarchs and other criminal actors are placing their assets. Holding investment advisers to the same AML standards applicable to other financial institutions would help achieve this important national security objective.

In August 2015, FinCEN proposed rules to do just that. The proposal would have closed existing regulatory gaps by requiring investment advisers to implement and maintain AML programs. In the preamble to the proposal, FinCEN noted that “[a]s long as investment advisers are not subject to AML program and suspicious activity reporting requirements, money launderers may see them as a low-risk way to enter the U.S. financial system.” The recent FBI assessment, press reports of potential sanctions evasion by Russian oligarchs, and FinCEN’s own alerts to financial institutions demonstrate that these concerns may have become more acute in the years since FinCEN proposed these rules. We are pleased that the Administration shares these concerns as described in the United States Strategy on Countering Corruption in December 2021, which commits Treasury to re-examining the proposed rules from 2015. President Biden has rightly proposed additional funding for FinCEN to address the growing regulatory and enforcement demands on the agency, and we look forward to working with our colleagues to provide expanded resources in the fight against financial crime.

Investment advisers have an important role to play in safeguarding the U.S. financial system from crime. They can be valuable partners for FinCEN as it seeks to meet our enormous challenges to combat not only money laundering, but also fraud and other financial crimes. Such a partnership is also important to ensure the effectiveness of U.S. sanctions programs, which have expanded significantly during the pendency of FinCEN’s rulemaking. Accordingly, it is critical that rigorous AML and sanctions compliance standards be extended to investment advisers.

For these reasons, we respectfully request that you move as quickly as practicable to address this weakness in the AML system. We appreciate FinCEN’s efforts this year on a variety of fronts and amid competing priorities, including drafting and publishing several new rules to implement the Anti-Money Laundering Act and Corporate Transparency Act of 2021. Thank you for your attention to this critical matter, and we look forward to your reply.

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WASHINGTON – Today, the Senate Select Committee on Intelligence Chairman Mark Warner (D-VA) and Vice Chairman Marco Rubio (R-FL) applauded the Senate’s passage of the Intelligence Authorization Act for Fiscal Year 2022 (IAA) as part of the omnibus spending bill. The House of Representatives passed the legislation earlier this week. The IAA authorizes funding, provides legal authorities, and enhances congressional oversight for the U.S. Intelligence Community.

“The Intelligence Authorization Act ensures that the men and women of our Intelligence Community have the resources, personnel and authorities they need to keep our country safe while operating under vigorous supervision and oversight,” said Committee Chairman Sen. Mark R. Warner (D-VA). “The funding and authorities provided in the IAA will increase the Intelligence Community’s ability to detect and counter cyber threats, ransomware attacks, and other emerging threats, including those from adversaries such as China and Russia. This IAA will also reinforce oversight of the IC by strengthening protections for whistleblowers, reforming the security clearance process, and mandating a robust response to reported cases of ‘Havana Syndrome.’”

“Our annual Intelligence Authorization Act provides critical authorities and funding for the U.S. Intelligence Community and its dedicated personnel, who provide our first line of defense to protect our nation,” said Committee Vice Chairman Sen. Marco Rubio (R-FL). “This year’s Act provides increased capabilities to confront the multitude of threats facing our nation, including the Chinese Communist Party and other autocratic states like Russia, Iran, Cuba and Venezuela; the dispersed terrorist and cyber threats; and also provides the tools for leveraging the commercial sector’s innovation to address intelligence challenges.”    

Background:

The Intelligence Authorization Act for Fiscal Year 2022 ensures that the Intelligence Community (IC) can perform its critical mission to protect our country and inform decision makers, while under robust Congressional oversight, including in the following key areas:

• Increasing oversight and investments to address the growing national security threats and challenges posed by the Chinese Communist Party and its related influence operations, including in technology, infrastructure, procurement, and digital currencies; 
• Improving the IC’s response to the anomalous health incidents (AHI), known as “Havana Syndrome,” by establishing an independent medical advisory board at the CIA, ensuring benefits eligibility and access to expert medical advice and facilities, and requiring protocols on testing, information safeguards, and reporting mechanisms;
• Improving the IC’s ability to adopt Artificial Intelligence (AI) and other emerging technologies;
• Bolstering investments in commercial imagery and analytic services to provide more unclassified collection and analysis to policymakers and warfighters in a more timely manner;
• Continuing the Committee’s commitment to reform and improve the security clearance process, including mandating a performance management framework to assess the adoption and effectiveness of the Executive Branch’s “Trusted Workforce 2.0” initiative; more accurately measuring how long it takes to transfer clearances between Federal agencies so it can be shortened; and creating IC-wide policies to share information on cleared contractors to enhance the effectiveness of insider threat programs;
• Ensuring strong congressional oversight of and protections for IC whistleblowers who come forward to report waste, fraud or abuse;
• Addressing intelligence requirements in key locations worldwide, including in Latin America and Afghanistan to confront foreign adversaries’ efforts to undermine the U.S. abroad;
• Strengthening the IC’s ability to conduct financial intelligence; and
• Supporting the IC’s efforts to assess unidentified aerial phenomena (UAP), further building upon the work of the UAP Task Force.

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WASHINGTON – U.S. Sen. Mark R. Warner (D-VA), Chairman of the Senate Intelligence Committee, released the following statement regarding President Biden’s executive order on ensuring responsible innovation in digital assets:

“Today’s executive order does a commendable job of balancing the potential opportunities and benefits of digital assets in financial innovation, economic inclusion, and global payments modernization against the risks and challenges they present to core U.S. interests. I applaud the executive order’s recognition that maintaining the centrality of the United States in the global financial system – and, in particular, the role of American governance standards and the primacy of the U.S. dollar – is absolutely fundamental to our efforts with regard to digital assets. The EO’s urgency with respect to a strategy for a U.S. Central Bank Digital Currency (CBDC) is especially welcome, and I look forward to working with the administration on further steps to engage on international norms and standards related to CBDCs.

“Today, we face a highly motivated adversary that is actively searching for opportunities to evade the substantial sanctions imposed by the Biden administration and our allies around the globe. We must ensure that all participants in the digital assets marketplace are actively complying with sanctions, and we need to develop clearer guardrails and improved enforcement to address fraud, illicit finance, and insecurity in the wider digital assets industry.”

Last week, Sen. Warner sent a letter to Treasury Secretary Janet Yellen raising concerns regarding the potential use of cryptocurrency to evade sanctions imposed on Russia after their invasion of Ukraine.

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WASHINGTON – The bipartisan members of the Senate Intelligence Committee, led by Chairman Mark R. Warner (D-VA) and Vice Chairman Marco Rubio (R-FL), today urged President Joe Biden to make sure that the United States is sharing as much intelligence as possible with Ukraine as the country faces a Russian military build-up on its border.

“Vladimir Putin is threatening the freedom and security of the Ukrainian people, and they have shown their eagerness to take action to defend their sovereignty, freedom, and democratically elected government,” the senators wrote in a letter to the president. “To this end, we request that the United States share intelligence with Ukraine to the fullest extent possible. Russia is the aggressor, and we need to arm Ukraine with critical information needed to defend their country. This is in the interest of U.S. national security, as well as that of our allies and partners in the region. Russia’s threats to Ukraine are a threat to democracies around the world, and we urge you to do as much as possible to support Ukraine at this critical moment.”

In addition to Sens. Warner and Rubio, the letter was signed by Sens. Dianne Feinstein (D-CA), Richard Burr (R-NC), Ron Wyden (D-OR), James Risch (R-ID), Martin Heinrich (D-NM), Susan Collins (R-ME), Angus King (I-ME), Roy Blunt (R-MO), Michael Bennet (D-CO), Tom Cotton (R-AR), Bob Casey (D-PA), John Cornyn (R-TX), Kirsten Gillibrand (D-NY), and Ben Sasse (R-NE).

A copy of the letter is available here.

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WASHINGTON – U.S. Sen. Mark R. Warner (D-VA), Chairman of the Senate Select Committee on Intelligence, issued the following statement regarding an interim assessment conducted by the Central Intelligence Agency (CIA) on anomalous health incidents (AHIs):

“Reports of anomalous health incidents among intelligence, diplomatic and military personnel emerged as early as 2016 but were not always taken seriously in the past. CIA Director Burns has appropriately made this issue a top priority for the agency, seeking answers as to the cause of these mysterious symptoms, and whether they can be attributed to work of a foreign government. There is no question that members of the intelligence workforce have suffered from conditions requiring a medical response. I am heartened that there are now procedures in place to ensure that those who are affected by these anomalous health incidents finally have access to the world-class care that they deserve. In a briefing before the Senate Intelligence Committee, CIA leadership emphasized that there will be no changes to the seriousness with which they investigate AHIs, process for reporting AHIs, or eligibility for care as a result of these interim findings. We’re going to continue to take care of our folks and treat them with the empathy that they deserve.

“While Director Burns has earned the trust of the Senate Intelligence Committee that he is taking this challenge seriously, it’s important to note that today’s assessment, while rigorously conducted, reflects only the interim work of the CIA task force. The Senate Intelligence Committee will continue pressing for answers on a bipartisan basis, and we look forward to robust engagement with the intelligence community, as well as the conclusions of the outside experts panel that has been assembled to seek answers to these very urgent and difficult questions.”  

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