Analyzing The European Fight Against Terrorism Financing

Case Studies

As mentioned in the introduction, the ‘SWIFT affair’ and the EU’s Third AML/CFT Directive have been selected as case studies in this thesis. The use of case studies is very suitable for the type of research carried out in this thesis for three reasons. First, case studies are a preferred method when the research focuses on a contemporary topic with a real life context (Yin, 2009, p. 2). This is precisely the case when exploring the practices created in name of the European fight against terrorism financing. When the Data Wars project, carried out by Durham University and the University of Amsterdam and of which this dissertation is part, started in 2008, there was little academic information available on this fight and even less on the daily practices set in motion. Concentrating on these two specific case studies has helped to gather and open up a lot of detailed information.

Secondly, case studies are useful for investigating social processes (Swanborn, 1994, p. 316). By concentrating on a specific case it becomes possible to analyse interaction on the micro level. This can include, for instance, the creation and reproduction of meaning, the emergence of disagreements, the different steps in the decision-making process, or the mapping of the various perspectives and motives of participants. The analysis of social processes taking place in these two case studies has been crucial for studying the exercise of power in name of the European fight against terrorism.

Thirdly, a case study allows for a thorough investigation of a complex issue (Swanborn, 1996, p. 38). Contrary to a causal model that measures specific pre-defined variables among a significant set of respondents at the moment of the survey, a case study considers a range of meaningful features or causes of one specific case over a certain period of time. In other words, case studies can offer a holistic approach (Swanborn, 1996, p. 26, Yin, 2009, p. 4). This holistic aspect of the case study also explains why case studies have been used very frequently in studies of governmentality. The selection of the case studies must respond to the core concepts of the research question (Klotz, 2009). The SWIFT affair and the Third Directive have been selected as case studies because these are the main ways in which the war on terrorism financing has taken shape in Europe. They are both examples of the use of personal financial data for security and, more specifically, counter-terrorism purposes in Europe. Both are also part of a broader turn to commercial databases for security purposes and fit in a spectrum of examples such as the PNR and e-border cases investigated by the British research team of the Data Wars project, and the use of telecommunication and internet data, and even purchase information. Yet, the two case studies also have important differences. First of all, the Third Directive is a legal framework concerned with suspicious transaction reporting that has never raised much societal or political controversy. It is a rather specific and detailed instrument that requires specific entities mainly in the banking and financial sectors to comply with certain counter-terrorism requirements. Because of its seemingly undisputed character and the fact that the Directive mainly affects the internal organization of a specific group of businesses, it has been largely invisible. The SWIFT affair on the other hand has been highly visible and controversial as it entailed the transfer and surveillance of international wire transfers, that were initially illegal according to European law. In this case, the US and European political scenes play an important role. The difference between the two cases is important to provide a more complete understanding of the practices at work through the European fight against terrorism financing. The next section discusses the qualitative research tools adopted to investigate the two cases.

Documentary Research and Textual Analysis

In addition to the study of academic literature, this thesis is based on extensive documentary research. This includes the analysis of: official reports from public and private authorities, press releases, political statements, laws, policy documents, (transcripts of) parliamentary hearings and debates, international press articles, internet blogs and journalistic books. These have been very valuable sources for examining the way in which the European fight against terrorism financing has been defined and represented. Documentary research helps in reconstructing events, tracing decision-making procedures, and examining the range of arguments and opinions held by the participants governing the European fight against terrorism financing. In addition, documentary research helps to shed light on the techniques of governing. For instance, legislative texts prescribe the action required from banks and financial service providers and banks’ annual reports often mention which steps have been undertaken by the bank to comply with the law. Journalistic works, on the other hand, were crucial to reconstructing the practices developed in the Terrorism Finance Tracking Program (TFTP). In chapter 4 documents have been used more systematically for a textual analysis in order to investigate how participants in the field governing terrorism financing supported orcontested the TFTP. This section discusses the potential pitfalls of documentary research and the adopted methodology for textual analysis.

Although (official) documents appear to constitute stable and objective evidence, they are in fact socially produced for a certain purpose on the basis of certain ideas, theories, or principles (Atkinson & Coffey, 2004, Bryman, 2008, Gilbert 2008). For this reason, it is important to reflect on the interpretation and meaning of documents. Scott (1990) distinguishes four criteria for assessing the quality of documents. First, the authenticity of the documents needs to be established. Given the fact that most documents used in this thesis are of very recent date and available through libraries or on the official websites of the investigated public and private authorities or media outlets, it is not very likely that these are falsified or wrongly copied. In this sense authenticity has not been a matter of concern. Authenticity can also be an issue of concern when the authorship of the articles is unclear (Bryman, 2008, p. 525). However, in the context of this thesis, this has not been problematic.

Secondly, the credibility of the texts merits consideration. One can for instance wonder whether the quotes from anonymous sources in journalistic books or articles are reliable. But also official statements made by politicians and government officials can be biased and in strong contrast with for instance the actual legal arrangements. The credibility of the text can be assessed by reflecting on the following questions: Who produced the document? Does the author have an interest in distorting the truth? And why, when, and inwhat context was the text written? (Gilbert, 2008, p. 294). Although it is unquestionably important to know if statements or documents can be attributed with certainty to a person or organization, it must, however, be stressed that the aim in this thesis is not to establish the credibility of texts in the sense of being representative of the truth. In fact, it is through the confrontation of differences in the presentation and interpretation of arguments and facts that the rationalities that underpin the European fight against terrorism become visible and can be understood.

A third criterion is the representativeness of the document or the set of documents. This issue has been especially important with regard to the textual analysis discussed below. In general it can be said that with the help of Internet search engines and public databases a wide range of documents published by public and private actors have been consulted on each of the case studies. Nevertheless, it must be noted that only official and publicly available documents have been consulted. Internal or confidential correspondence, minutes, and memos fall beyond the scope of this research. Last but not least, Scott (1990) states that the meaning of the document needs to be established. In this respect, a distinction can be made between the literal meaning and the interpretative understanding. According to him, ‘at its simplest, interpretation requires an understanding of the particular definitions and recording practices adopted and of the genre and stylisation employed in the text’ (p. 30). The hermeneutic process of interpretation goes a step further as it also involves ‘interpretative understanding of individual concepts, appreciation of the social and cultural context through which the various concepts are related in a particular discourse and a judgement on the meaning and significance of the text as a whole’ (Scott, 1990, p. 31). Hence, in order to interpret the meaning of the text it is important to investigate the situation and the intentions of the author as well as the societal context in which the text was written. This kind of interpretative research can be carried out through textual analysis.

Chapter 4 offers a textual analysis of the debates concerning the SWIFT affair in, respectively, the US and the EU. There are various approaches to textual analysis ranging from semiotics to more quantitative forms of context analysis. In chapter 4 the approach followed by Huysmans and Buonfino (2008) has been adopted. In their article they have investigated how and in what instances British politicians represent or contest nexuses between terrorism and immigration. For their analysis, they selected all parliamentary debates on terrorism that took place in the House of Commons and the House of Lords during a certain period. The dates they have chosen include the debates following 9/11 and the Madrid bombings. They also included some key debates held in 2005 especially debates that took place after the London bombings, to verify of any important changes had taken place. In a first stage Huysmans and Buonfino have searched the written transcriptions of the parliamentary debates through Hansard, the edited verbatim reports of the proceedings of the British parliament, using the keyword ‘terrorism’. Then, they refined their search through words related to immigration. Next, debates containing both themes were read for meaning, structure and connection with other themes. As such they analysed how certain dangers were politicized and how insecurity was framed around the migration/terrorism nexus (2008, p. 768).

Chapter 4 investigates how and at which moments the SWIFT affair was (de)politicized in the US and in the EU. The main sources for this analysis are newspaper articles. Two different considerations explain this choice. Aside from the fact that journalists initially revealed the SWIFT affair, so far most information has been published by the press. Moreover, newspaper articles are also a place where the multiple participants involved in thefield (political leaders, privacy groups, law-enforcement officers, and spokespersons from SWIFT) are made to interact and different opinions can be traced. While other sources, including parliamentary debates, international agreements, court rulings, and the study of the relations between the participants in the field, are also taken into account and enhance our understanding of the SWIFT affair, they are far less comprehensive with regard to the quantity of information and often offer a less all-round view on the affair. However, the importance of investigative journalism for our analysis of the SWIFT affair provokes some reflection on the value and the risks of using media sources. Gilbert emphasizes that the media are selective in what they decide to publish and from what angle they report on issues (2008, p. 289). This selectivity and even self-censorship is illustrated in the discussion of the revelation of the SWIFT affair in chapter 4 and is also discussed in the context of the discussion of the SWIFT programme as a black box in chapter 5. In addition, it must be kept in mind that newspaper articles may contain errors in the facts they present, they may be subject to distortion at the level of the editor, the journalist, or the initial source, and they are written with a specific audience in mind (Gilbert, 2008, p. 289). These potential risks have been carefully taken into account in the examination of newspaper articles. The textual analysis of the debates on the SWIFT affair in the US and in the EU is based on newspaper articles available in the Lexis-Nexis newspaper database between 23 June 2006—the revelation of the Swift affair—and 31 August 2010, the month during which the latest US-EU agreement was adopted. This database contains all major and regional American and European newspapers as well as Canadian, Australian, and Asian newspapers. All English, French and Dutch newspapers offered in the database have been included in the search and have been systematically investigated (for a complete overview see Annex 2). I believe that this comprehensive approach, yet with a focus on the leading US and EU newspapers, constitutes a representative selection for the analysis of newspaper articles. The articles on the SWIFT affair have been selected through searching for the acronym “SWIFT.” Subsequently, all articles containing the word ‘swift’ but referring to for instance a specific car, football clubs or doing something rapidly instead of to the SWIFT affair were filtered out. Additional searches were made using the words “banking data.” The next stage involved reading the articles and searching for and listing the arguments made in relation to the SWIFT affair. Which words were used? Which themes were raised in the debate? Which arguments were used to defend the various views held in the SWIFT affair? Which solutions were proposed to ‘solve’ the SWIFT affair?

A last comment with regard to document research is the fact that organizations’ official documents usually disregard social interaction and struggles, as they are considered irrelevant or undesirable for the final version of the document. For this reason Atkinson and Coffey (2004) argue that documents have a distinctive ontological status, in that they form a separate reality, which they refer to as a “documentary reality.” In order to complement and question the “documentary reality,” interviews with key persons have been carried out.