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tv   House Intelligence Hearing on Russian Interference Tactics Part 1  CSPAN  March 30, 2019 3:24pm-6:23pm EDT

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will take up a senate passed resolution and the u.s. military involvement in yemen's civil war. continues on, work a bill that would provide nearly $13 billion in aid for areas affected by natural disasters. also, a resolution that would shorten the amount of time the senate considers certain nominations. watch the house live on c-span and the senate live on c-span 2. next, a testimony on russian interference in the 2016 presidential election with testimony from a former u.s. ambassador to russia, and former cia russian operations chief. at the beginning, mike conaway submitted a letter from republicans, calling for adam schiff to resign in the committee for his actions involving the investigation and russian interference in 2016. the hearing is three hours.
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russia, a former cia moscow station chief and former officials with the state and treasury departments testified at the hearing. thank you, come to order. without objection the chair is in power to declare a recess at any time. today the house permanent select committee on intelligence will hold an open hearing to discuss how the kremlin uses financial leverage to -- financial
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leverage to influence foreign policy, and number two, the importance of counterintelligence operations and investigations as distinguished from criminal investigations, almost exactly two years ago james comey disclosed publicly for the first time in testimony before this committee that the fbi had initiated a counterintelligence investigation into russia's interference in the 2016 election. while that investigation would lead special counsel mueller to initiate a great many criminal proceedings resulting in numerous indictments and convictions, it began and has continued as a counterintelligence investigation. what does that mean?
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counterintelligence investigations are designed, among other things, to determine whether any u.s. persons and in particular those in positions of influence in government or business may be vulnerable to foreign influence, manipulation, coercion or compromise by a hostile foreign power? this notion of compromise or compromat in russian can be sultle and discreet, it can be witting or unwitting and it can take many forms. but it is at the heart of russia's play book to sew discord in democratic institutions, create leverage to influence foreign and national policy here and abroad and encourage nations to act contrary to our security interests, or theirs. we do not yet know the results of the counterintelligence investigation, initiated by comey, and then continued by mueller. it is not clear whether, or to what extent the mueller report, which is focused on
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prosecutorial decisions will even discuss counterintelligence findings. but the counterintelligence concerns that animated the investigation in the first place may ultimately have the more profound impact on security and policy, and we therefore await the publication of the mueller report to find out. today we have an expert panel that will help us explore how russia uses intelligence tools to influence foreign nations, both the united states and others, and we will have a particular focus on russia's use of financial leverage to achieve their goals. our esteemed panelists will address the inter-play between business, government and intelligence in vladimir putin's russia. putin uses business and corruption to maintain control at home and influence foreign policy and finally we will delve into the issues of sanctions and why sanctions relief was so central to russian's foreign policy or foreign influence campaign, and remains a
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preoccupation of putin's today. let me now take a moment to introduce our panelists. mike mcfall served as the u.s. ambassador to russia from 2012 to 2014. and as currently director of the freeman -- institute for international studies at stanford university where he is also a senior fellow at the hoover institution. steven hall is the former cia chief of russia operations and enjoyed a 30-year career in the agency. heather conley is a senior vice president for europe, eurasia, the author of the kremlin playbook. thank you all for joining us today. i now yield to the ranking member for any opening remarks he'd like to make. >> thank you, mr. chairman, today we will hear from a panel on russian oligarchs, challenges will be a abiding topic of this
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community for many years. under the obama administration committee republicans repeatedly warned the administration privately and publicly that more resources and better intelligence were needed to counter numerous threats, our advice was not heeded, misspelled reset buttons, direct promises, the scrapping of missile defense plans in poland and the czech republic at russia's behest and the ridicule of then candidate mitt romney for identifying russia as our primary geopolitical foe. all under a administration that watched helplessly while russia marched into ukraine and annexed crimea. the ic has resources and authorities needed to protect the united states. we should not be used as a platform to spread false information and bizarre conspiracies. we have unique capabilities and authorities to do crucial
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oversight work, and now frankly speaking that is not being done. this committee was created to oversee the intelligence kmun community, not serve as a tribunal, launching investigations of the party's political opponents. >> prior to the inauguration of president trump in january 2017 you've been at the center of a well orchestrated media campaign claiming among other things the trump campaign colluded with the russian government. indeed before the appointment of robert mueller as special counsel you alleged in one of your frequent television interviews that there was "more than circumstantial evidence" of collusion but that you could not go into -- your repeated statements occurred at the same time anonmost leaks of alleged intelligence and law enforcement information were appearing in the media, leaks often sourced
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to current administration or intelligence officials appeared to support the collusion allegations and were reported to be related to ongoing investigations of president trump and his associates. as you know the committee has long been aware of and actively engaged in the intelligence oversight activities related to russians malign activities. as part of our duty to oversee the actions of the intelligence community we conducted a thorough investigation related to the 2016 russian efforts to interfere. this investigation included a review of the allegations that the trump campaign colluded with russia. the committee found no evidence that president trump or anyone associated with the trump campaign colluded, coordinated or conspired with the russian government. the minority views which you submitted were attached to our committee's findings and yet your views did not provide any evidence to support the claim of collusion. on march 24th, 2019 the special counsel delivered his findings to the government -- to the --
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the special counsel's investigation did not find that the trump campaign or anyone associated with conspired or coordinated with the russian, with russia in its effort to influence the 2016 presidential election. special mueller's findings are consistent with those of this committee as well as the public statements on the senate select committee intelligence. despite these findings you continue to proclaim to the immediate cra that there is significant evidence of collusion. you further stated you will continue to investigate the counterintelligence issues, that is is the president or people around him compromised in any way by hostile forn foreign power. your willingness to continue to promote a false narrative is alarming. your past and present assertions have exposed you having abused your permission to -- damaging the integrity of this community and undermining the faith of this government in these
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institutions. you actions, past and present, are incompatible with your duty as chairman of this committee which alone in the house of representatives has the obligation and authority to provide effective oversight of the u.s. intelligence community. as such we have no faith in your ability to discharge your duties in a manner consistent with your constitutional responsibility and urge your immediate resignation as chairman of the committee. mr. chairman, this is signed by all nine members of the republican 150side of the house committee and i ask that it be submitted into the record at today's hearing. >> without objection. i'm going to turn to our witnesses, the subject of the hearing today. before i do, and as you have chosen, instead of addressing the hearing, to simply attack me, consistent with the president's attacks, i do want to respond in this way. my colleagues may think it's okay that the russians offered dirt on the democratic candidate for president as part of what
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was described as the russian government's effort to help the trump campaign. you might think that's okay. my colleagues might think it's okay when that was offered to the son of the president at a pivotal role in the campaign, that the president's son did not call the fbi, he did not adamantly adamantly refuse that foreign help. no, instead that son said that he would love the help of the russians. you might think it's okay that he took that meeting. you might think it's okay that paul manafort, the campaign chair, someone with great experience in running campaigns also took that meeting. you might think it's okay that the president's son-in-law also took that meeting. you might think it's okay that they concealed it from the public. you might think it's okay that their only disappointment after that meeting was that the dirt they received on hillary clinton wasn't better. you might think that's okay.
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you might think it's okay that when it was discovered a year later that they lied about that meeting, and said it was about adoptions, you might think it's okay that the president has reported to have helped dictate that lie. you might think that's okay. i don't. you might think it's okay that the campaign chairman of a presidential campaign would offer information about that campaign to a russian oligarch in exchange for money or debt forgiveness, you might think that's okay. i don't. you might think it's okay that that campaign chairman offered polling data. campaign polling data to someone linked to russian intelligence. i don't think that's okay. you might think it's okay that the president himself called on russia to hack his opponents' e-mails if they were listening. you might think it's okay that later that day, in fact, the russians attempted to hack a
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server affiliated with that campaign. i don't think that's okay. you might think that it's okay that the president's son-in-law sought to establish a secret back channel of communications with the russians through a russian diplomatic facility. i don't think that's okay. you might think it's okay that an associate of the president made direct contact with the gru through guccifer 2 and wikileaks that's considered a hostile intelligence agency you might think it's okay a senior campaign official was instructed to reach that associate and find out what that hostile intelligence agency had to say in terms of dirt on his opponent. you might think it's okay that the national security adviser designate secretly conferred with a russian ambassador about undermining u.s. sanctions and you might think it's okay he
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lied about it to the fbi. you might say that's all okay. you might say that's just what you need to do to win. but i don't think it's okay. i think it's immoral. i think it's unethical. i think it's unpatriotic. and yes, i think it's corrupt. and evidence of collusion. now, i have always said that the question of whether this amounts to proof of conspiracy was another matter. whether the special counsel could prove beyond a reasonable doubt the proof of that crime would be up to the special counsel and i would accept his decision, and i do. he's a good and honorable man and he is a good prosecutor. but i do not think that conduct criminal or not is okay. and the day we do think that's okay is the day we will look back and say that is the day america lost its way.
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and i will tell you one more thing that is a-- i don't think it's okay that during the presidential campaign mr. trump sought the kremlin's help to consummate a deal that would make him a fortune, hundreds of millions of dollars, i don't think it's okay he concealed it from the public. i don't think it's okay that he advocated a new and more favorable policy towards the russians, even as he was seeking the russian's help, the kremlin's help to make money, yok it's okay that his attorney lied to our committee. there's a different word for that. than collusion. and it's called compromise. and that is the subject of our hearing today. >> gentleman yield. >> mr. ambassador, you're recognized zblr will the gentleman yield, you made -- all of us that i think we all should get the opportunity to respond to. we're going to say we think you ought to allow us of what we
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think. >> you can use your five minutes to speak, you attacked me in your opening statements. >> i have not -- no one over here thinks that. no one over here -- you cannot speak for us. >> mr. attorney, you're not recognized. ambassador mcfall, you're recognized. thank you, mr. chairman, thank you ranking member nunez and everybody else that's here today. i want to start with some good news, the ideological struggle between communism and capitalism during the cold war is over. that's the end of my good news. the bad news is that there is a new ideological fight between putinism in the west and it's only just begun and in my estimation we as a country are underestimating it and are not focused enough on it. put putin defines this contest as a battle between the decadent liberal multilateral west that dominates and is anchored by the united states of america, and
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what he calls his brand, not my brand, of conservative sovereign values. i define this contest as one between autocracy, corruption, state domination of the economy and indifference to international rules, laws and norms versus democracy, rule of law, free markets and respect for international law. as i wrote in my detailed written remarks with lots of footnotes, forgive me, i am a professor, putin uses oligarch's money and intelligence to wage this battle at home and abroad. we must better understand the nature of the threat, and that's why i'm honored to be here today to talk a bit about that. my remarks are divided into three different parts, the evolution of putin's system of government at home. second, illustration of how putin seeks to export his ideas and practices abroad, and third, time permitting, a specific focus on putin's effort to lift
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sanctions on russian individuals and companies. let me go through those three, time permitting. first, puttenism at home, i think we all, in this committee especially know the general contours of it. let me remind you of several specifics and trends. first, putin started right away in 2000 to roll back checks and balances on executive power. focusing first and foremost on controlling the media understanding quite well how central that is for autocracy and that's why he's focused on the internationalization of russian media to export his ideas abroad. second, after two decades of putin's rule the russian regime has become more autocratic over time. every term that he served he's now in his fourth term it's become more autocratic, not less. third, during this period the fsb, the federal security service, one of the successor organizations to the kgb has played a growing role in running both the state and the economy.
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russian intelligence officers today play a much greater role in ruling russia than the kgb ever played during the soviet union. fourth, putin has used the redistribution of property rights among russian oligarchs as a central tool for ruling russia. now, of course it's true that he enriches his friends and cronies through this redistribution, but it's also a way that he rules russia. if he decideds who's rich and who's not that makes those that become rich on his watch completely dependent on him. also, by seizing assets he keeps everybody on their toes. fifth, and not surprisingly therefore, the growing arbitrary and pernicious role of the state in the russian economy has stifled economic growth and to justify this form of rule and poor economic performance, therefore, putin needs an external enemy, and that is us.
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second, exporting putinism, putin actively seeks to propagate his ideas of governance and conservative values and i want to keep emphasizing, as defined by him, not me. i don't consider it conservatism. but he seeks to court both ideological allies to win them and to weaken his ideological foes, not just between states, but within states, including the united states of america. he's developed several instruments of power to try to do this. first, he and his government have invested heavily in international media. r.t., $300 million budget a year, sputnik international, very active on american social media platforms, r.t. claims to be the most watched media company on youtube today. and all of these organizations were active in influencing voter preferences in 2016. second, putin and his proxies set up organizations, fake identities, bots to influence public opinion around the world,
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including the united states of america. i urge you to go back and read the indictment from mr. mueller of the internet research agency. it is outrageous what the russians did, violating our sovereignty in 2016. and i urge you to read every word of it and think about what we need to do to prevent it in the future. third, putin has deployed his intelligence agencies to steal information from foes, and then publish this information in ways to weaken enemies, fourth, the kremlin actively cultivates direct contacts and ongoing relationships with individuals, ngos, political parties, religious groups, and individual politicians sympathetic to putinism, fifth in parallel putin uses money to influence foreign policy. two instances are instruments of
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putinism, not profit maximizing companies. and finally rarely but sometimes he uses very coercive agents including soldiers to advance putinism abroad. i have gone over my time. i have things to say about sanctions, maybe we'll get back to that in questions. thank you, mr. chairman. >> thank you, ambassador, mr. hall. >> good morning, happy to be here with you today to share my thoughts on vladimir putin's russia, gleaned from working in the cia's clandestine service for over 30 years. during my time at cia when i started out as a line case officer when i retired, most of my time and efforts were focused on russia. i retired as the chief of central division responsible for managing cia russian operations worldwide. i'm not a trained russian historian or analyst. this comes from my experiences
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and it's an important perspective. i'm often for my thoughts on who putin really is, what makes him tick, how much of a threat he is really. vladimir putin is first and faux most goal is weakening of the democracy of the united states and the west. the secret police of which putin was a member, as well as the modern day russian intelligence officers, and its successors built and ran the concentration camps, and executed thousands of citizens at headquarters in moscow. the history of the russian intelligence service is one of brutality. every year on the 20th of september vladimir putin calls and congratulates the members of the russian intelligence services on their historical successes. this is how seriously putin views his role as a checkist. these checkist traditions persist in russia today. i once had a conversation with a russian intelligence officer who made the argument that all
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countries, even western democracies had intelligence agencies, the russian argued that the cia was not that different from the kgb. i disagreed vehemently. cia has made its share of mistakes, but we have not built concentration camps nor did we murder american citizens. i mention this story because it illustrates the need for the west and in particular the united states to resist the temp cation of seeing putin's russia through a western lens. most persons were taught an optistic outlook on live. they use this effectively against us. look, they argue, we have many similarities. when i was most recently in moscow i could go to mcdonald's or starbucks, large hotels, some of them american chains, businesses appear to be operating normally, even governmental structures that seem comfortably similar, the douma which looks like congress,
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a president, prime minister, positions we have heard of and can relate to. but one really sees a thinver near of normalcy designed to cover how things really work. putin's russia is run by the mob and the kremlin, many of whom work formally for the russian security services. i'm also asked about russian organized crime. it's important to avoid asking this question through a western lens. broadly putin runs russia like a crime boss. those he finds effective he rewards. if someone falls out of favor, punishment usually follows. enemies of the putin organization, either internal or external, are neutralized, independent journalists are killed, political opponents are flooded with lawsuits, incarcerated or assassinated. oligarchs are not exempt and putin uses his intelligence services to collect damaging information on all of them in case they fail to produce for in the future. the rule of law in russia is a
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caricature created to make us in the west believe that putin's system really is not that bad. like any place run by the mafia, businesses, foreign and russian, are allowed to operate, only in rules set by the mob, in this case the kremlin. prior to my retirement, both staff asked for cia's thoughts on the labs, a cybertechnology company run. my response was that they understood that when putin or one of his men called or needed something from the company highway had no choice but to comply. putin knows in which banks your fortunes are held, when owe knows your net worth and where your wife and mother and children live, you do what you're told. if you flaunt the am is, it doesn't end well. ask a rich russian oligarch who was sent to jail for ten years with trumped up charges in exile in the uk. it does not protect once powerful oligarchs. putin is the intellectual author of dozens of murders and
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attempted assassinations abroad. people like skripal and his daughter attacked by the gru using a russian nerve agent and another found hanged in his london home. all lessons from which other powerful russians understand well. this is a key component to how the oligarch system works in russia. putin will help you become very rich as an oligarch and allow you to maintain your riches as long as you support the kremlin when required. if you fail the consequences, as noted above, are severe, over the past several years putin has included the olligarchy as part of his alliance on warfare in the west. in addition to defending against attacks from russia, putin is also using non-traditional means, using his oligarchs. putin controls russia and his oligarchs using a complex system
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which bears many of the traits of the czechist state. utilizing internal and external threats. internally he uses the fsb and other entities to gather information against people and companies that can be leveraged later. he also uses oligarchs to exert economic and financial pressure on targets inside and outside of russia. the kremlin also controls the information that flows to the majority of russians and so anti-west and pro putin propaganda themes keeps russians where he wants them, under his control. the same organized crime hold for foreign businesses in russia. putin will have his intelligence services collect intelligence on any american businessman which he has an interest. it includes video surveillance against the target while in russia. entrapment and arrests have been used against american businessmen in the past, more recently russian intelligence framed and arrested paul wee
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land who is still languishing in a russian prison. all intelligence services play important roles in collecting the information which can be used to control all businesses, foreign and domestic in russia. this is not to say that foreign businesses have never been successful in russia. what it is to say is that success is conten gent upon the kremlin's approval of such business activity. if an american business person runs afoul of the kremlin, all that's collected against him or her will be quickly and efficiently leveraged. intelligence officers are expert in collecting information that can be used to blackmail anyone putin wants. they've collected information against american business people in the past, they have collected against me and my family while i was in russia, as well as ambassador mcfaul. if you have ever traveled to russia, any of you, you've been collected against as well. no one is immune. in an open session like this i boent be able to address in great detail what i know how the russian intelligence services do their work. i cannot exposing the methods of
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our own intelligence services, nor those of our allies. but i would be more than happy to address any questions you might have. thank you. >> thank you, mr. hall. ms. conley. >> chairman schiff, ranking member nunez, distinguished members of this committee, thank you so much for the opportunity to share with you some of the research that csis has conducted regarding the patterns and methodology of russian malign economic influence. we've analyzed 11 european countries. we've entitled this body of research the kremlin playbook and we've just released our second report in this series. and mr. chairman, with your permission i would like to place that report in the record. >> without objection. >> thank you. congressman nunez, you're absolutely right, russian malign influence has been working for many, many years. in fact, our central and eastern european allies told us very clearly of that, even as far back as 2009. but before i dive into the
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russian malign economic influence, i think it's important for us to take a quick step back to understand how russia is weaponizing illicit financing and creating a financial gray zone and place that into a broader context. what we are living through is russian -- the russian military doctrine of new generation warfare. it is a strategy of influence, not of force. it's designed to erode the confidence and credibility of democracies to such a point that those democracies will seek an accommodation with the kremlin's policies and the interests over their own national interests. there is no advanced u.s. weapons system that can push back against this. russia competes with the united states where we are at our most vulnerable. it exploits every weakness, every societal division, everything, faith, history, how and what kind of information we read, racial tensions,
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partisanship, illicit financing, failed privatizations, cyberattacks, each separately and in combination and all have one objective to diminish america's strength. an adviser to president putin recently summarized the power of regeneration warfare i think quite nicely. i quote "foreign politicians talk about russia's interference in elections and referendums around the world. in fact the matter is even more serious. russia interferes in your brains. we change your conscience, and there is nothing you can do about it" well, there is something that we can do and must do. but let's be clear. although this hearing is about what russia does and we need to have a much better understanding of how russia penetrates our institutions and our democratic processes to prevent it, this is about strengthening our own democratic house and minimizing our divisions. our patriotism must be greater
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than our partisanship. by downgrading our democracy or degrading it the kremlin seeks to demonstrate the moral equivalency between put putinism. if there's no kircdifference we reach that. it's very different from authoritarian regime and it's the requirement that democracy be transparent and accountable and that is, in fact, the place where our research begins. how do we enhance transparency and accountability of our own systems and institutions? this is where the battle is now being waged. and democracies, unfortunately, have begun to mirror and facilitate clept to cattic functions as funds are laundered, shell corporations and subsidiaries are formed to circumvent tacks. this is what we fight. in mr. putin's world view everyone and everything has a price. and we must firmly state that
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democracy is priceless. these illicit figures are eye watering as i note in my written testimony. when we began this research i had anticipated that russian investments would be diminished in europe, particularly after the imposition of u.s. and eu sanctions in 2004. but this is not the case. the size of the inbound and outbound financial flows, both illicit and perfectly legal, have all become a very powerful tool of russian malign economic influence. and just a very brief example, in the countries that we analyzed italy, austria and the netherlands alone, russian foreign investment stocks have expanded from 5 billion euros in 2006 to 160 billion at the end of 2017. in the netherlands alone russian company assets have jumped from 13.2 billion euros in 2007 to 96 billion euros in 2017. so we're seeing a growth of
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russia's economic influence in europe, not a reduction. and so as these illicit funds are being used, they're funding european political parties and individuals which share the kremlin's agenda and objectives, and that is working against u.s. security and strategic interests. they are used to deepen economic dependency on the kremlin. we call this the invirtuous cycle of malign influence. it appears that many individuals proved mr. putin right. they do have a price, and it can be easily paid. but how we fight and win this battle is to fight through greater transparency and democratic accountability. we need illicit financing as much as we do terrorism financing. examples of deutsche bank, corporate service providers, opaque beneficial ownership, we must work collaboratively with
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our european partners to detect illicit financing and push it out of our system. we need to make sure that the highest transparency standards are there for ultimate beneficial ownership. this is how we strengthen our democra democracy. mr. chairman, this is how we win. thank you. >> thank you very much. mr. lorber. >> thank you, mr. chairman. ranking member nunes. i'm monitored to appear before you today. russia poses a serious national security challenge to the united states. in the last two years alone, russia has illegally occupied crim crimea, destabilized ukraine, subvert western democracies including by attacking the integrity of u.s. elections, launched cyber attacks against the united states and allies, and used chemical weapons to conduct assassinations in western europe. the united states and its partners must respond forcefully and thoughtfully to this threat, including to the use of targeted economic measures.
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as an economic sanctions and illicit finance compliance professional, i will focus my testimony today on three key points. first, our sanctions on russia have had an impact. through the use of course of economic measures, we have put pressure on particular russian targets and caused economic pain to the russian economy. second, this impact has been limited and while resulting in some chang changes in russian br is unlikely to significantly alter russian decisionmaking, that could be costwould be kovc. third, we need to look beyond sanctions, to my colleague's point, to include tracking, tracing and preventing ill liic russian funds from entering a system as a way to counter certain types of russian malign influence and activity. aml, cft, backbone of the international finance system. such an approach would make our
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sanctions programs more effect if. one of the primary challenges in any sanctions program is effective implementation. while it is relatively easy to screen transactions, customers and counterparties for names of sanctioned parties, russian oligarchs and sanctioned persons are adept at hiding their identities and involvement in efforts to move funds around the world. the real work to make these programs effective takes place when conducting investigations into the ultimate beneficial owners of companies, unmasking front and shell companies, and working to determine sources of funds. to the extent that thebollster tha their aml k, cft regimes, they' be able to catch russian illicit actors trying to use their institutions to move funds. such an approach would have the added benefit of strengthening our defenses against illicit financing more broadly. to bolster our regime and countersanctions, congress can take a number of steps. first, congress can pass
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meaningful beneficial ownership information. even as the united states continues to enhance and expand its financial tools to combat various national security threats, these efforts are undermined by the exploitation by anonymous legal entities. foreign adversaries can use anonymous companies for a range of purposes here in the united states, alone, including undermining the efficacy of important laws such as the foreign agents registration act, and campaign finance laws. while it's important to fush foreign companies to require companies to collect, maintain, disclose accurate information at the time of company formation, we must also follow the same standard here in the united states and pass such legislation. second, resource implementation and enforcement. the counterillicit finance apparatus in the united states government is small and the budget spartan, given the outsized role that professionals at treasury, intelligence, and regulatory agencies are askeded to play in safeguarding national
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security. given treasury is asked to address an ever growing set of national security challenges, congress should provide them with significantly increased resources to endusure it is abl to address the challenges at hand. and third, call upon finsen, financial crimes enforcement network, to issue an advisory on russian sanctions evasion and money laundering red flags. finsen regularly promulgates guidance, red flags of finance ri risks. to assist financial institutions to disrupting illicit russian financial flows, congress should call upon the treasury department to detail red flags associated with illicit fund flows. in addition, congress should call upon finsen to coordinate an advisory with international partner financial intelligence units. such a coordinated advisory would further assist foreign financial institutions in protecti protecti protecting. increased transparency, additional sanctions and cooperation with partners on additional economic pressure can
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have an impact on vladimir putin and his cronies and the regime, but while these tools are powerful, this committee, congress, and the administration more generally should not labor under the misconception that our economic authorities are a silver bullet to counter russian malign activities. i'd be happy to discuss any of the particular recommendations i put forth as well as sanctions on russia more broadly. thank you, and i look forward to your questions. >> thank you,lorber. mr. malhall, can you explain ho russia uses finances as a cou count counterintelligence tool? >> sure, i think the best way to look at it, again, is to imagine the russian intelligence services and the putin -- and the putin regime, the kremlin, itself, as collectors of information first and foremost, and unlike in our own intelligence community, where we oftentimes, if not almost exclusively, collect information for policymaking purposes, in
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russia, what's collected is information that can then be used economically, if necessary, against targets of putin's choosing and against the targets that the russian intelligence services might choose. so that's a very powerful tool because, of course, when you're looking at how to leverage people, how to get people to do what it is that you want them to do, finances, personal economic and, of course, they're also just their professional persona, oftentimes come into play in terms of what motivates people and how you can best leverage that. russian intelligence services are very active in doing precisely that. >> and how -- how might they use financial entanglement, beyond for the purpose of gathering counterintelligence, but for the purpose of either gathering compromise -- gathering compromise or seeking to influence foreign decisionmaking? >> i would say both is the answer to that. the first is the easy part for them. collecting compromising information, kompromat, as we
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know the word now in russian, is what not only the fsb, internal service, the external service, the gru, the entire security structure in russia, has been doing that for decades, if not arguably centuries. so this is something that they're set up to do. whenever anybody comes to russia, goes to russia, that type of -- that type of collection will be initiated against targets of interest and what is gathered from those operations, those collection operations is either stored for later use or can be simply used immediately and the same goes -- the same holds true for financial information. i'm not sure if i got the second part of what your question was. >> let me ask you this. do the russians engage through their oligarchs, does the kremlin engage through their oligarchs in illicit transactions to the fact it may be useful in the future to hold those illicit transactions as compromise over the target of those transactions? >> sure, that would certainly be
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consistent with some of the things the russian intelligence services have done in the past. again, the goal is to collect compromising information that can, indeed, be used for any number of different activities against a given target down the road. so whether it is financial information, business information, or some things, just things motivate different human beings. they will collect on all of those things in an effort to leverage those things to get people to do what they want them to do. >> and can that financial entanglement take the form of money laundering? >> yes, absolutely. the russians have a long history of money laundering not just for the purposes of sanctions and that sort of thing, but in basic intelligence operations when they want their operations to be funded in a certain way that is not easily discoverable, you know, there's -- there may be some folks in caribbean island co some place who money launder better than the russians do but the russians are right up there. >> ambassador mcfaul, in your written testimony you talk ab t about, or make reference to the effort to build a trump tower in moscow.
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viewing this from the russia perspective, let me ask you a couple things. if a presidential candidate sought to make a major real estate deal in moscow during the campaign, is that something that would have come to the attention of vladimir putin? >> i don't know, i want to be clear. i think we should know the facts of that. let me speak generally that over the course of time in russia, to do big business deals requires permission from the kremlin. anders osland, one of my colleagues at the atlantic council, has just written a fantastic book if i can recommend it to you coming out in may. he estimates any deal over $1 billion has to get direct approval from the kremlin. remember, just to build on some things that steve said, putin is using that not just as a way to enrich his friends and
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redistribute property to enrich his friends but doing that to make those people loyal, do midwest ek ad domestic and foreign. if you want to do a major multimillion dollar transaction in russia, you need to coordinate and be loyal to president putin. that's very loyal. i want to echo another thing steve said. you don't have to do that in the united states of america, right? thankfully we don't have that. in that system at state being at the center of everything, you have to have at a minimum that kind of coordination with the kremlin. >> there are public reports that the trump organization sought to enlist the help of dmitry peskof. can you tell us who dmitry peskov is, how close is he to putin and how would he view that kind of overture or request for assistance coming from the business of a presidential candidate? >> so i know dmitry pes kov.
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i'm on the russian sanctions list. i used to deal with him closely. he's not just the press sec stair for the president as is commonly reported. he's a very close adviser to president putin. has aspirations for other bigger jobs, by the way. to be honest, i think it's rather naive for somebody to try to call peskov to do a business deal but i think that reflects a common perception that you have to deal with the kremlin. i think there are maore sophisticated ways you would do that. most certainly, he has the public image of being very close to putin and if you were looking for a way to get to putin, most certainly you'd try to reach out to mr. peskov. >> what about the necessity of obtaining financing from one of the major russian banks? can you tell us about the relationship between those banks and in the kremlin and how the kremlin uses those as an instrument of state policy? >> well, all the three major banks and even the fourth and
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fifth bank, the three big ones, bear bank, vb, and vtb, are all kno owned by the government. remember that always. i think there's variation in the way those banks operate in the world. i think zbare bank operates a little bit more like a normal bank. they have deposits and seek business opportunities. vb spot reallyis not really a b. it's referred to in the press in russia as putin's bank. former head of it, i think you mentioned him in your opening remarks, sergei gorkov, was also an intelligence officer. the new head of it is somebody i used to work very closely with. he used to be the deputy prime minister, really in charge of the government in terms of economic policy and it's completely controlled and acts on the behalf of the kremlin.
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>> ms. conley, one of the running themes through the last couple years has been an effort to, by the russians to do away with sanctions on russia over its interference in our election, over its invasion of crim crimea. can you talk about the centrality of efforts to do away with sanctions which we have seen so recurrently in our investigation. why is that such a top priority for the kremlin? >> mr. chairman, it's important because vladimir putin has to manage a very challenging long-term decline of the russian economy. he needs those sanctions to be lifted particularly in the financial space to allow needed funds to come into the russian economy. so this is in some ways it's always about regime survival, but the economic means are very important. because the sanctions have been tailored to many members f o s inner circle, that also increases pressure on that as
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well. we had anticipated the european union might -- individual members might challenge the longstanding eu sanctions. they have not, which is a very positive, but in our research, what we found is, but we can't be comforted even by our own sanctions regime. while it has been very helpful, what we're seeing is patterns of shifting changes. now it's about, you know, incorporating through subsidiaries new monetary flows that are going through, a lot of sanctions that have been grandfathered so we're actually not seeing, i think, as much power of those sanctions. this is the -- this is the thing that we have to understand. russia's tactics are always evolving and adapting. what we're fighting against are two years ago of a sanctions pattern may have already shifted into other arenas, other areas, and that's why it is a constant moving target. it's a whack-a-mole. we have to be very forward
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meaninmean i leaning. i don't think we can think about that as being very sufficient and finally, it's a lot of concern about the magintsky act being very, skrrning to them and the europeans are now increasely adopting that legislation, additional concerns. we see some progress but also see some loopholes now being used to great effect. >> mr. nunes? >> thank you, mr. chairman. ambassador mcfaul, you're aware that lying to congress is a crime and you're expected to tell the whole truth here, correct? >> yes. >> just want to ask you a series of folks you may or may not be familiar with but i'm interested to know whether or not you've communicated with these folks. ambassador kislyak was the former russian ambassador to the u.s. you communicated with ambassador kislya kislyak? >> yes. when i worked at the white house, i met with him often. >> how about egor sechin, who's
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the ceo of rosneft? >> yes, i first met egor sechin in the spring of 1991. >> when he was a deputy for vladimir putin? >> i didn't have a lot of contact with him until i became the u.s. ambassador. >> bill browder? >> yes, i know bill browder. i've met with him many times. >> what about natalia veselnitskaya. >> no, nata lia veselnitskaya. when i testified, she was sitting behind me. i never met her personally. >> we'll count that as a no. >> glen simpson from fusiongps. >> i don't believe i ever met him. no. >> anybody associated with
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fusiongps. >> you'd have to tell me who's affiliated with them. >> nelly orr? >> no. >> what about bruce ore? >> no. >> jonathan winer, state department? >> i know of jonathan winer, we were on the list together of people putin wanted to arrest after tehelsinki. i don't think i ever met him, sir. >> christopher steele? >> to. >> benjamin wittis? >> i know him, yes. >> what about michael isikoff? >> i know him. i've met him a few times. we're not colleagues. >> okay. i'm going to ask you, your name pops up in a lot of articles in 2016. matter of fact, you're one of the first folks to talk about carter page. there's a june 17th, 2016, "washington post" article written by tom hamburger where you and david cramer are sourced in that article. are you familiar with that article? >> sir, no the off the top of my
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head but i know that reporter, yes, and i know david cramer, used to work for the bush administration, yeah. >> how did you know carter page was going to be in moscow in july of 2016? speaking at a conference. >> i read about it in the russian press, sir. he spoke at the new economics school. he was the speaker at their graduation ceremony. >> you were live tweeting during that conference? several tweets at that time about that conference. were you watching it live? >> i don't remember, sir, but whatever i said on twitter would know what i said. i did remember at the time i found it ironic and somewhat strange that they would choose carter page to be their commencement address speak er. the last american to have that honor was barack obama in 2009. i probably commented because i most certainly believe it to this day that it was very odd, to me, that this rather obscure
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businessperson would be given such an honor. >> there's another article i want to draw your attention to, it's rather famous, but it was written by mike bchael isikoff yahoo! news, december 23rd, 2016, used to get a fisa warrant on carter page. are you familiar with that article? >> not off the top of my head, sir. >> do you have any idea who the source for former u.s. government official, who the source would be? >> no, not at all. >> that gave information on carter page to michael isikoff? >> i do not, sir. >> were you ever briefed on or given reports from fusion gps? >> no. i just read about it in the press. >> so you -- the first time you ever saw the dossier was when? >> when it was published by buzzfeed, is that right? as i recall. that's when i saw it. >> you never saw the dossier before that? >> no. >> all right. yield back, mr. chairman.
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>> thank you, mr. nunes. miss sewell. >> thank you, mr. chairman, thanks to all the witnesses today. so often former military and intelligence officers are often part of the business elite, become part of the business elite, and i guess my question to you, ambassador mcfaul, is how common is it to find former russian intelligence officers, you know, serving as senior executives in russian banks or in russian companies abroad? >> it's only become common under vladimir putin so that was not the case during the earlier years, during the yeltsin years or during the soviet times but over the last 20 years you have seen a very systemic replacement of ceos of the top russian government enterprises owned by the government, replaced with fsb officials and other military
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officials and pretty much, you know, i could go through the list. i brought the list if you're interested, but the vast majority of them, not all of them, so -- so i mentioned zbare bank earlier, that's the largest russian bank ran by a guy named garman greth to the bheest of m knowledge. steve may know things i don't know. he's not a member of the russian intelligence. zubalef who runs veb is not. many of home' are fothem are fo intelligence officers. that's a bit of a paradoxical statement to make, former intelligence officers because once in the kgb, they're always loyal to the kgb. >> are counterintelligence or current intelligence efforts to track russian business, financial, or economic influence efforts in north america and in europe adequate? or are efforts -- are counterintelligence efforts to track sort of these russian business alliances efficient?
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>> so i've been out of the government for five years so i don't know what is happening on the class ified side. you might know ettbetter than i. d i do want to say as an academic who follows these things closely, i think it is grossly understudied. this is hard stuff to study, by the way. you have some the best people in the world that do it. but we don't have good information on that. we're not tracing it. the ability to set up companies anonymously here and to buy property and to use law firms to transfer money, all of those things prevent researchers from doing that kind of work. and i would strongly encourage this committee to use the facilities and resources you have to do more of that work because one other thing i want to say, not all russian business abroad is illegal or run by putin. a lot of it is but not all of it
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is. i think we make a mistake -- all the capital fight that heather mentioned, a lot of that is money running away from putin because they don't want it be stolen from them. i think having a firm accounting of that then how it is used and how it is used as leverage would be an excellent assignment that this committee should give somebody. >> so mr. hall, are there certain red flags that are indicators of operations hidden by the kremlin as business alliances? are there red flags yoo s you t about? i know, and not compromise sources and methods. >> i would imagine there are probably forensically some things that can be determined when you're looking at money laundering, when you're looking at illicit activities of that type of thing. being a former cia guy, you know, i want spies because it's much easier do hato have somebo the inside telling you here's what these guys are doing.
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both parts are obviously needed and members of this committee are certainly better versed than i am in terms of what we're doing in collection on that. it's definitely thing that needs to be looked at. >> how hard is it to recruit within moscow, within russia? >> it's a challenge for a number of reasons. i hesitate because i'm trying to figure out what i should and shouldn't say in that regard. let me say i think russia -- when i worked at cia, we had, and probably stud dill do, a gr of hard targets. russia, china, iran, normal folks you'd probably expect. the hardest of the hard, folks who are really, really difficult to recruit and get information out of. >> what actors are probably the most vulnerable to intelligence operations, would you say? >> in terms of recruitment operations? >> yeah. >> you know, really, i'm not sure it breaks down in terms of blocs because it's about human beings and what motivates them and what their vulnerabilities are. it just depends on the individuals. >> thank you, mr. chairman. >> thank you, r miss sewell.
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mr. conaway? >> thank you, mr. chairman. before i get to my questions, mr. chairman, let it read in the record i did so with a heavy heart and with thought and consideration, there's nothing more difficult thwe do than tryg to hold each other accountable. our words, our actions have consequences. that's what we try to do. the litany -- well, let me say this, you know, the emotional reaction you had is certainly expected, but let me be clear, clear, convincing statement for the record, nothing in our letter could be interpreted or remotely interpreted as causing you to be able to accuse us of thinking it's okay for that long litany of prepared remarks that the you read into the record that you said you were not okay with and then to imply with your -- the technique that you're very good at that somehow we do. we don't. our letter has absolutely nothing to do with what president trump, candidate
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trump, campaigns, whatever they might have done. our letter speaks to our concern that the intelligence agency that we seek to oversee the important role, important -- in fact, unique role, that this committee has in that role in congress, is compromised by your continued leadership and i don't say that lightly. you and i have had a good working professional relationship for over 2 1/2 years. and it doesn't -- it doesn't please me the least to say that. with that, would one of the panelists speak to the northstream 2 pipeline? is it, in fact, a pure commercial enterprise? or, in your judgment, will putin at a point in time use that pipeline to further leverage his mischief in germany and in europe? >> sir, i'm happy to take that question. in fact, we offer some thoughts on the financing structure of nordstream 2 and, again, how european banks are being used to
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fund russian projects. >> speaking of that, are those financing arrangements typically commercial based? or the interest rates higher than you would expect in this market? >> sir, i would not have the details on that. i think, again, for us, it's the transparency and the complexity of how these deals are structured that, in part, we need to have a better understanding. no, in my view, nordstream 2 is not strictly a private energy deal and this has been brought to the attention of the german government. this increases europe's dependency on russian energy. we have to think of nordstream 2 in the same light as a pipeline called turk stream which is bringing russian gas to turkey to increase europe's dependency and what we highlight in our report is actually the energy sector, russia uses that as such a powerful tool not just for dependency, but it's the financing that is buys a lot of the downstream energy of other
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countries. it is such a powerful tool, and it is very important that congress continues to emphasize that nordstream 2 is not in europe's interest. >> any question of the four of you that putin would not use that leverage if he felt it to be to his advantage, anybody believe he would be an honest broker across that? in the time -- >> just one quick note. what heather already said, it increases the dependence of our european allies, it also reduces the transit fees for ukraine so it's very deliberately aimed at weakening ukraine. >> thank you for that. i appreciate that. i agree. can you speak to the russian oligarch's mischief in armenia, by extension putin, and the effect it's having on that nation's nascent attempts to regain its sovereignty and remove the russian influence from it? anybody speak to that? >> i'm sorry to say i'm not as familiar with armenia. >> armenia is a country in the
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south caucususes. >> i'm not aware. >> i thought my west texas accent messed up the pronunciation -- >> i -- >> putin, might as well use putin in lieu of the word, russia, anyway. everything runs through him. thank you for your clear-eyed testimony this morning about the threats he poses to democracies around the world and our national interest. with that, mr. chairman, i yield back. >> thank you. i yield to mr. carson. >> thank you, chairman schiff. mr. hall, can you explain the relationship between the russian organized crime opeapparatus an the oligarchs and how do they even co-exist? >> as i said in my statement, this is a question i get often and my first response when i'm asked about russia organized crime is always to remind people to the extent possible to take off these western lenses. when we think of organized crime in the united states, we think of the mafia, we think of, you
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know, al capone, all that sort of thing. i believe in russia, those distinctions with much less clearer or practically nonexistent. when you have little rule of law in a country like russia, it's extremely weak, i would argue in some places nonexistent. it's very difficult then to determine who's an organized criminal and who's not. when you have vladimir putin, the head of the country, essentially approving murders outside of his own country, how does that not make him an organized criminal? so, that's said, we have, in the west, and intelligence services, have gone to some extent to try to map those out. you know, who are the different key mob bosses, if you will? again, for me, it's a little bit of an artificial construct because it's all sort of organized crime. the oligarchs play a key part of that. the way i look at this is i think the simplest way to look at this is, again, like, you know, any of the guys, whether it's kaspirski, any of the
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others, if you get a call from the kremlin or call from any of putin's guys saying, hey, i need this from you, whether or not it's building a stadium in sochi, whether its organizing some sort of business deal outside of russia or something inside of russia, an appropriate answer is not, yeah, i appreciate that, but no. the appropriate answer, if you want to keep your, well, your life in most cases, is, yes, sir, how many bags of three bags full, and here he comes. it's a little more complicated, a little more subtle. in terms of discussing the relationships, that kind of encompasses how things work a lot in russia. >> in wrapping up, given the sprawl of russian intelligence, are oligarchs or their businesses used oftentimes as cover or vectors for influence for intelligence operations? >> again, yes. i mean, that's certainly -- the reason i say yes is not because i have the top five in my mind, but, again -- >> of course. >> -- if the fsb, you know, who answers directly to vladimir putin and the others, calls you up and says, hey, you have is this business located in x, y, z, location, i need you to do
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the following things for me, it gets done. it's a unity of government approach that we probably would all love -- i guess we wouldn't love to have here in the united states, but certainly something they can do. >> are any oligarchs even bold enough to challenge putin philosophically. >> that's a tough one. that's to ask what goes on in the meetings outside of moscow when they all get together over the weekends? i argue even if you were a fly on the wall, if you had some way to monitor what goes on in these meetings, i'm still not sure we would understand because vladimir putin being a former operative, himself, i think is playing his oligarchs and his power people against each other do see what their reactions are going to be and what his best way forward is. i think it's all very complicated stuff and mike's probably -- >> should have asked the am bass ambassador that question, but, yeah. >> so thinking off the top of my head about oligarchs, they like to be called businesspeople, let's call them oligarchs for now. no, i can't think of somebody that would stand up and confront
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vladimir putin today. >> not even a childhood friend? >> well, the childhood friends are a little bit different. you know, there's a crony group -- there are different categories, right? so there's the people he put in place of the state-owned enterprises. we talked about them. then there are the oligarchs from the 1990s. let's point out that's a different group than his friends own cronies that now run these companies and some who become billionaires only because of their relationship with putin. some of those people did challenge him. one was mentioned by steve hall earlier. he was arrested in 2003 and spent 10 years in jail as a result of challenging him politically. and once that happened, that, as you can imagine, that had a chilling effect on other oligarchs standing up to him. of his circle, you know, think there are two people that are not oligarchs but, you know, people i used to deal with and others have reported that do challenge his assumptions. one is garman greff who i
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mentioned, head of zbare bank. he has the kind of personal relationship with mr. putin that he can do that. he was one of the original reformers back in the early 2000s. >> did he serve in the kgb with vladimir putin? >> to the best of my knowledge, i want to underscore, i don't know everything. to the best of my knowledge, no. the other is alexi kudrman. those are the only two i know who have stood up to putin in discussions of policy, not respect to property rights but in discussions of economic policy. >> thank you, both. i yield back, chairman. >> thank you, mr. carson. mr. turner? >> when senator joe mccarthy walked the halls of congress, people in this nation were transfixed but they were also appa appalled, and this body then recognized the danger of unethical abuse of congressional powers. the testimony from steve hall today says that he has vladimir
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putin identified as his primary goal as the weakening of democracy in the united states and the west. mr. chairman, i'm asking for your resignation today because i believe you are advancing putin's work. i believe the chair has abused his power, in these processes and misrepresenting the information that we received in classified sessions no. now, mr. chairman, when this body saw mccarthyism was to be rejected. you're using the playbook. we had russia chasing after russian communists and now we have schiff chasing after russian collusion and those who would collude. mr. chairman, in your opening statements, you attacked in true mccarthy fashion each and every one of us. you stated that -- you stated what we think. you can't say what we think. it's the lowest form of any argument to attack someone. what we have said is we've come
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forward and said that we all think that your leadership of this committee is compromised, in far because you behave as if your fellow members of this committee are your enemy. you behave as if the president is also similarly your enemy. and in true mccarthy fashion, you act as though you are the only one who is capable of protecting this nation and everyone else is a co-conspirator who have suspected intentions. your response could have been that you're here to protect national security, that you're here to ensure this committee has no leaks, that you're here to ensure that this committee works together and that you want to have a true bipartisan work to support the international intelligence efforts of our country. instead, you've shown contempt for your fellow members of congress. for two years your opening statements have repeatedly attacked the members of this committee, their motives and their work. you have transformed the staff of this committee so that they are prosecutorial instead of working on issues of national
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security and intelligence. you have misrepresent ted to th american people information that we received in classified sessions. and you've had this committee diverge from its goals. that is a danger to our national security. it is a distraction. it causes this committee not to function. when this congress took a look back at itself and what had happened with senator joe mccarthy, it made a commitment that congress would no longer be abusive in its powers. that it would look to protecting its national security. mr. chairman, your reactions today were in true mccarthyism as you chose to attack us instead of state your commitment to national security. miss conley, did joe mccarthy advance russia's communistic goals of separating our country? did mccarthyism advance democracy or hinder democracy?
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did mccarthyism shackle us with the burden of divisiveness rather than cohesiveness in trying to move guaforward as we look to our adversaries? >> congressman, i'm not the best placed witness to answer your question. >> ambassador mcfaul? >> i'm also not an expert on mccarthyism. i'm an -- >> i just want your personal opinion. >> i do think polarization in our society advances putin's national interest. >> ambassador mcfaul, i greatly appreciate you answering that question. now my question goes to montenegro. you know i worked on nato and nato issues and i'm very proud of the fact that our nation supported montenegro joining and i think that certainly sets aside some of the advancement of russia and russia's interests. when i was in montenegro, they hadbillboards up chastising nato. can you tell us of the effect of our work with nato in montenegro and how it sets aside russia's
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advance? >> congressman, thank you. russian influence in montenegro is substantial, in fact, it's one of the case study countries we note. the economic influence particularly concentrated on real estate and tourism and you're absolutely seeing some of the by-products of where that great investment is. they can finance billboards and political parties to work against the euro-atlantic drive of these countries. i can't begin to tell you how vital is for nato to continue to give these countries hope and support, alongside of our european allies, that there is a different way, but what i would highlight for you is two things. one of the great est weapons within montenegro for russian influence is the serbian orthodox church. this continues to play an outsized role in shaping montenegrans' views of themselves and where their
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future lies. secondly, would argue, the lesson i learned, i want deputy assistant secretary at the state department when we enlarge nato in 2004 for central and european allies and made a fatal mistake. we believe our work is finished when these countries enter nato or the european union. it is absolutely the opposite. the work begins. we have to redouble our efforts to make sure that montenegro remains secure in the euro-atlantic community. the fact that russian gru members hatched a coup attempt in october of 2016 to prevent montenegro from joining nato tells you the steps that the kremlin will take to stop the forward march of these countries joining the west. so, sir, your leadership on that was very important. all of congress' leadership is important as the senate embraces ratifying an amended nato treaty to welcome the republic of north macedonia, another dramatic attempt that russia tried to prevent.
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thank you. >> mr. quigley. >> mr. chairman, interesting aspects of our chairman. i mean, any chairman who would conduct a midnight ride, prepare a memo which was called dangerously reckless, use sensitive law enforcement information without any evidence to support any of its conspiracy theories, who would tank an investigation, shut down an investigation, go along with a white house gag order, attack the fbi and intel community, inhibit their ability to complete their work, extraordinary. mike morale said what the russians did was the political equivalent of 9/11. i fear what the administration has done and this former
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chairman, not the current chairman, has done, will have far greater and more profound impact on our country, on the ability of the intelligence community and the justice department to do its job. so it's simple to say and talk about these things but it was just last month, march, which chairman nunes said he had uncovered evidence that the intel community, we would assume the fbi and nsa, had improperly monitored and unmasked trump transition teams and he rushed off to the white house to tell him all about this. it was just one of many string of activities to undermine what was attempted, what we were attempting to do to find the truth. so given that, we'll go on to the questions at hand. mr. hall, can you dive a little deeper in how the kremlin and the gru, among others, used the money laundering efforts to complete their intelligence activities?
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>> i think the best way to look at it is that when the gru, or really any of the russian intelligence services, has a requirement for financing, whether it's an operational requirement for people to travel from point "ark" to point "b" o want to use or try to develop compromising information, business or financial, otherwise, they have the means to do that, not only internal to the gru, but also because the order for doing something like that would probably come from more senior outside the gru. again, this is sort of like a mob type of situation we're thinking about. resources inside of russia that the gru can access are essentially limitless. when the boss says, you know, we need financial information on this particular individual or that western businessman, then it gets done. and if the gru is the one who's chosen to do it by the kremlin, then off they go and the resources are there. there is no oversight process there. there's no budgeting process.
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there is, but it's primarily paperwork. so they really have all the resources that they need to go after whatever target the kremlin decides they need to go after. >> mr. quigley, there are only two minutes left on the vote. let's recess here and we'll return right after votes and we'll pick up with mr. quigley. thank you. we are in recess.
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>> committee will come to order. mr. quigley, you are recognized. >> thank you. to our panel, where do the russians launder money, and who are their dance partners? >> sir, i'll take that question. the russians launder money, short answer, all over, but certainly throughout eastern, western europe, through major financial institutions and in
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major financial capitals, and potentially here in the united states as well. >> and to your knowledge, do we have any idea where near the united states and who they might be working with? obviously, we are aware of deutsche bank being fined money for laundering money. >> so not to my knowledge where specifically, but that gets to sort of the primary issue is that both the united states and in europe, as one of my co-panelists has made clear, there are limits to how much information we can obtain regarding beneficial ownership information, information about the true identity of individuals behind companies, and that obscures both our ability within law enforcement and intelligence, but also private sector financial institutions' efforts and ability to really dig deep and figure out who these individuals behind these companies are and where they're located. >> so they're laundering to escape sanctions, principally. and taxes we assume. >> i think it's a whole range of financial crimes, to mr. hall's
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point from earlier, it's not just sanctions evasion, it's laundering for tax evasion, it's laundering for other types of illicit finance, for human traffics, kind of across the board. >> yes, sir? >> just if i could add to that, cyprus, of course, is one of the countries that russia uses for money laundering, but the uk and the united states are probably e list as well because of things my colleagues talked about. i wanted to underscore it. anonymous companies, we allow that here. that's a vehicle for laundering money. purchase of property can be done without transparency. that's another way. and then because of client privilege relations, law firms are also one of the vehicles. so as a recommendation, i just want do underscore something heather said earlier, actually eric as well, very concretely, if you want to fight what the oligarchs do abroad, more transparency is the right thing -- is a very important
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part of that. second thing i want to emphasize, however, is that not all of the money coming out of russia is controlled by putin. i think that's really important for people to understand. a lot of it is money that is afraid of putin. they don't want their money to be stolen. they don't want their money to be confiscated by the kremlin. so they are also part of the group that are moving their money from russia to places in the west. >> thank you. my time has more than expired. >> thank you. dr. wenstrop? >> thank you, thank you very much. thank you all for being here. one thing i do want to say from the outset as somebody who's in his first elected office, not my first term but my first elected office. i'm a doctor, surgeon. it's not illegal for me to continue seeing patients and operating on them while i was a candidate. things changed once i became a candidate and there were different rules. became a member of congress and there were different rules. just want to say that for the
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record. ambassador mcfaul, i appreciate you talking about the -- i call it the instruments of putinism, it you will. i think that it's what we do need to address. i want to talk about that in a moment. we had morality defined to us today, frankly, i consider entrapment to be immoral especially if it's being done by russians. i think it's immoral for a campaign or a party to which many of our members here have donated, to pay a british agent and russians -- let me point that out. russians were involved with the dossier. to create an unverified salacious document against the opposing candidate. okay? now, i doubt that putin was unaware that russians took part in that. that well documented. i'm surprised to see the legs that that took. putin probably never imagined, or maybe he did, maybe he did, that the fbi, the doj, possibly the cia, would focus on the
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american candidate and their campaign, rather than the russian involvement with this entire thing. you know, to the point of surveillance of the campaign, running people into the campaign, and in my opinion, to try and entrap innocent people from that campaign. we even saw an attempt at entrapment on the chairman by some comedians. but with all of this, and i'm sure mr. putin looks on with glee as we now have a nation so divided, polarized as was said here today, it's beyond my belief. and they've gotten away with it. i said in this committee two years ago as the fighting began, which was not dare my first term on this committee, by the way, until mr. trump won. as the fighting began, i said
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the russians are getting everything they want. right now. and we have not had discussions of fisa abuses this term. we've not had discussions on the unmasking processes that take place. all risks which have raised serious concerns about what is taking place here. we also haven't had discussions on russian involvement with the dossier. and i don't know how we get back together as a nation and how we become unpolarizeded if we will. if we don't address the truth and have true justice and america know what actually took place. so i'm disappointed, as you point imagi might imagine, to see all this focus and none on the russians, themselves, as they were involved with that entire process from the beginning as having helped to write that dossier.
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and if putin was for trump, what has happened to the russians that tried to take him down? you've been very eloquent about the power of this man. i'd like to hear anybody that would like to comment on the russian involvement with this whole process from the beginning as being involved with the dossier. >> i could try to speak to that. you're referring to the steele dossier. i am not aware of, and, again, i've been out of service for a number of years now, but i'm not aware of direct russian involvement in the dossier. it -- i don't rule it out. i'm simply not aware of it. >> well, that's how it's been reported, but we haven't seen anything coming from within, ourselves, to say yes or no. >> that's -- >> we're investigating it. yet, that's what's been reported. and let me tell you, we've gone down a lot of paths because of things that were reported that
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weren't necessarily true. but shouldn't we be trying to look into is that? let me just have your -- if that's true, doesn't it disturb you? >> i think it's absolutely important -- >> mr. mcfaul, you're shaking your head yes -- >> go ahead. >> -- so i'd love to hear from you. >> absolutely, sir. i have a lot of questions about what the russians did in 2016 that haven't been answered. that's why i want to read mr. mueller's report. i used to work with him. he's a thorough guy. i look forward to reading that. i think we have, "a," have is to know what happened. we have to do the diagnostics properly. let me say two things. you asked for my opinion. that's why i woke up. i'm not an expert on what happened. two things i feel really strongly about. national security is not a partisan issue. i worked for the national security council. i didn't work for the democratic security council. i took an oath of office to the united states of america when i became the u.s. ambassador, and when i -- when we don't -- there are other issues that are done
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in partisan ways, right? tax policy benefits some and others. we can debate about that. you all debate about that. when it comes to national security, if the russians attack us, they're not going to just attack the republicans and leave the democrats to the side. they're not going to do that. and i hope -- b i'm sorry to get emotional, but i want us to get back to the national security threats that threaten all of us together. >> thank you. i appreciate that. i joined the military under a president i didn't vote for because i put that first. that was my commander in chief. i took an oath to defend the united states of america. i couldn't agree with you mr., mr. ambassador. thank you. >> thank you, chairman. and chairman, i support you holding this hearing and the work you've done to address the threats from the outside as well as from the inside. and first, i just want to ask, yes or no, is it the judgment of each witness that russia intends to attack and interfere in our democracy again in this upcoming 2020 election? miss conley. >> they will not stop.
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they will continue. >> ambassador mcfaul? >> i don't know. i know they have the capacity to do everything they did in 2016, and we as a country on multiple plains, i'd be happy to walk through all of them if we have time, have done next to nothing to protect ourselves. that doesn't mean they'll use that capacity. i think it will depend on the situation in 2020. will they look at the united states, will putin look at the united states as his principal enemy in the world and do things to reduce our capacity to do things in the world? the answer to that is, yes. >> thank you. mr. hall? >> yes, i believe they will. >> and mr. lorber? >> i don't know, but if past is prologue, as evidenced in 2016 and the 2018 elections, i have serious concerns that they will try. >> thank you. miss conley, what is the objective of sanctions against russia? >> the objective is to change russia's behavior and its violations of international law, whether that's the illegal annexation of crimecrimea, seizf
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territory in eastern ukraine. it's to punish them for the use of chemical weapons on nato territory. it is to change behavior. unfortunately, we've not seen a change of behavior, if anything, we've seen a doubling down of aggressive behavior. >> ambassador mcfaul, have the various sanctions affected the russia economy over the years? >> yes. there are different estimates. i go through different estimates if my written testimony. one estimate is 1.5% of gdp was lost in 2014. another one by the world bank puts it more at 2.5%. "bloomberg economics" put it at 6% since 2014. and that's only aggregate, congressman. remember, on the individuals, they also have an effect. putin, himself, has said on the record that it violates the human rights of some of those individuals. these are his close personal friends. so they definitely are having an impact, and i want to add two things, if i may, to what
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heather already said. the goal for us, of course, is to change putin's behavior. that is what sanctions are put in place for, but there's another thing i think that's important. sometimes you just have to do the right thing even if you know you're not going to change that behavior. think of the counterfactual. russia annexes territory in crimea and we do nothing, that will then create, i think, p permissive ways for him to do more. remember that even if you're not seeing change in behavior. also remember, putin very rationally wants to lift sanctions. if i were the president of russia, i'd want to lift sanctions ow on my close friend and reduce that burden on the russian economy. nothing spectacular about that. >> are they worthy of having sanctions lifted? >> am i worrieded? >> are they worthy? >> oh, no. no. what i wanted to say is rather than changing his behavior, he's waiting for governments to change. that's a very different strategy. right? in europe and here in the united states, that's what he's been waiting for. and in my opinion, that would be
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a cataclysmic mistake to lift sanctions just in the name of getting along with putin. you can't do that until he's changed his behavior. >> i've long thought, or i first thought after the interference campaign, that the reason that the russians sought to help donald trump as our intelligence community assessed is transactionally they wanted to get a benefit, they wanted to see the reduction of nato's influence, a candidate who talk talked about doing that. they wanted a candidate who would reduce sanctions. they wanted a candidate who would look the other way on what they've done in crimea. but the more i've learned through many of you and others on russia's intentions is that what they really sought to do was to tear down the idea of america. this idea that no matter who you are, where you're from, what your parents did, who you love, that if you work hard enough, you can be anything. if that's true in our young country, it could be true anywhere including in russia. the best way to keep russians
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from asking for that fair shot, that democracy, free markets, free ideas, freedom to dream, is to destroy it at its origin and that that was the bigger goal that they had. would you agree with that, ambassador? >> i think both can be true. so most certainly, the second piece and that is part of their focus and that's been the focus for, of putin well before the 2016 election. he's just using new means to get at that -- at what you described. the second is also true. you don't need to believe me, vladimir putin said it at the helsinki summit at the press conference. he said, i wanted trump to thel if you're putin because of what candidate trump said. i want to give the trump administration credit that all of those things they thought they were going to get, they didn't get. but the second category, i think they feel good that they're receiving returns on their investment on the second
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category you describe. >> i only point that out because we have learned about russian investments in the nra. they don't have gun rights in russia. so it's not like they're advancing some principle they believe in at home, but to stoke a cultural war, tearing down the idea of america. i yield back. >> mr. stewart? >> thank you, mr. chairman. and to the witnesses, thank you all. i'm familiar with several of you. i thank you for your service and for being here today. i do have a list of questions for you. but before i do, i feel like i have to address at least briefly the elephant in the room and to -- as kind of a man-to-man extension to our chairman why i signed this letter today. i consider myself a fairly soft spoken person. i don't ballistic clike or seek
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conflict, but the cahairman of the select committee is not just another politician or a member of the resistance and they disagree with this president. this individual is in a position of great responsibility and special trust. and that trust can be destroyed if accusations are made without evidence. last weekend, the attorney general, and mr. mueller, released their report and a synopsis of that report. this is important to me. some have said he concluded there wasn't sufficient legal threshold to prove conspiracy or collusion. but that's simply not true. he didn't say we saw evidence but it wasn't sufficient, he said we saw no evidence of collusion. he even added multiple attempts by the russians to make contact with the campaign, they have found no evidence of conclusion.
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mr. mueller found no evidence of collusion. yet just a few days ago, you said untoutedly there's collusion. it substitute collusion with treason, because you're not accusing someone of getting a parking ticket or stealing bubble gum, you are accusing the president of treason, of working with a foreign government, not an ally, a long-time known adversary, and you are saying he's committed high crimes and trying to steal an election, destroying the trust of the electoral process, and i don't think you can make that accusation at the same time say we're not going to call for his impeachment. i don't think you can have it both ways. if you truly believe that, i don't know how you could not rise today and say, he should be impeached and i will lead efforts to impeach him, because you can't say he's committed treason, and say we're okay with that.
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to use your phrase, mr. chairman. it has to be one or the other. and that's why i signed this letter today. now, to the witnesses, i would like to ask you a series of questions. just answer yes or no. do you think that the president's efforts to pressure nato to comply with their long-held commitments of spending 2% of their gdp on military and on readiness -- i was a former air force pilot. i remember flying with nato guys. they didn't have the capabilities we needed them to have, because their politicians had not committed to spending the money they said they would. do you think that pressuring nato to fulfill their commitments is an important tool to countering russia's influence in europe. >> pressing our european allies has been the policy of the united states government for
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well over 40 decades, and we must continue it. but we cannot use this pressure to break the alliance, and what the president has done has used an important tool to get them to spend more, and now created a real division in the alliance, and the fact that many of our allies are not entirely sure america is faithful in the credibility of that alliance. so the objective is right, the tactics, however, are defeating -- >> i completely disagree with you. i don't think it was the president's intention at all to weaken the alliance, we are simply asking them to do what they committed to do. if they won't do it, they're not a true member of the alliance. does anyone agree that pressuring nato to increase their defense pending counters russia interference? something i think that is
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important, pressuring our european allies not to rely on russia for their energy needs. in fact, domestic energy policy provides and drives down the price of global energy, i think every one of those are important policy decisions, which helps to counter russia's influence, globally and in europe. any of you disagree with that? thank you. >> could i address that? >> my time is up. it's up to the chairman. >> yes, you may respond. >> i think everything we just talked about with regard to nato and nato members paying, interpreted in this room and in a western context is understandable, and has been policy. the russians don't see it that way. vladamir putin sees that as a split and weakening the nato alliance and -- >> then he's simply mistaken.
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>> before i recognize mr. heck, i do want to comment on something you said, mr. stewart. because i think it fundamentally misconcedes what the mueller report is and what the barr summary is. the barr summary, which is all we have right now, doesn't say they found no evidence of collusion. that is simply not true. and that is repeated over and over again, so people think that's true. but that's not what the barr letter says. the pbarr setter says mueller could not establish a criminal conspiracy. there is evidence. that's the difference here. as i've said, mr. stewart, time and time again, and you can look in the public record, because i've said this, as a mantra dozens of times, i think that these interactions with the russians that i enumerated earlier evidence corruption and
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collusion rather. but that whether that amounts to a crime, the crime of conspiracy, i've always said is a different question that bob mueller would have to decide. and he's decided that question. and i respect it. and i said that i would respect his judgment. but that's what i've said. and i think that the letter fundamentally misconceives that. mr. heck? >> would the chairman allow me to respond? >> yes. >> and i'll do so quickly. we're going to have to agree to disagree on the verbiage. i think where you're making a distinction, you have never, to my knowledge, added that caveat. you have said, i see evidence of collusion. you didn't add that it would reach a legal threshold. we can find evidence of all sorts of things, but if it doesn't reach a legal threshold, it's meaningless. we'll agree to disagree and i'll concede my time. thank you. >> mr. chairman, may i briefly
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be recognized? may i enter into the record a finding mr. politifact that you indeed, did every time you brought up the question of collusion characterize it as a difference between a proof beyond a reasonable doubt finding by a prosecutor but there was evidence -- and that's a march 25, 2019 story, what democrats said about trump, collusion before mueller report. i would like to enter that into the record. >> and would you share what it says? >> mr. chairman, point of order. are we introducing politifact information? >> yes, we are. >> i object to that. >> mr. swalwell, you may be recognized.
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>> thank you. the article says, republicans have been having a field day rubbing the democrat's noses in the outcome of special counsel mueller's report. as the summary from the attorney general william barr quoted mueller's report, the investigation did not establish that members of the trump campaign conspired or coordinated with the russian government in its election interference activities. it goes on to characterize your statements, mr. chairman, and says that the top democrat and current chair, adam schiff has been a point man for the democrats throughout the investigation. and it quotes you as saying the number of times, including about a year after january 10, 2018, you said there's clear evidence of the issue of collusion. but whether it amounts to conspiracy beyond a reasonable doubt, i think we will still have to wait for bob mueller's work. schiff tweeted similar comments after pbarr's letter was releasd march 24. schiff wrote mueller did not
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find sufficient evidence. i trust mueller's judgment, but the country must see the evidence. >> thank you, mr. swalwell. you can find literally dozens of times where i made the same observations over the last year and a half. mr. heck, you're recognized. >> i would ask to put that into the record. >> it will be made part of the record. mr. heck? >> thank you, mr. chairman. i would like to be added to the list of those who also want to actually see director mueller's work product. i am consistent with what the chair has asserted over the last year and a half. i've placed a great deal of confidence in it, and there's nothing about that confidencech developments of the last week. i'm more than bothered by the fact that there seems to be a
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subtle but nonetheless real campaign to foot drag on the release of this material. my mother always taught me consider the source. and so when it does come to the four-page letter from the appointed attorney, who last summer submitted a 19-page single pace unsolicited argument that there was no basis for proceeding with obstruction of justice angle for example, i do want to read the mueller report. and i want to consider as well that which we seem to forget, because this is an evolving set of periodic amnesia it seems to me. the original assertion for quite some time by the administration was there's no interference whatsoever in the election, none! and then when the weight of the unanimous opinion of the intelligence community came to full effect, and it was there may have been interference, but they didn't favor either candidate.
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and then that fell by the wayside. and then it was no collusion. of course, we are where we are on the definition of these terms. earlier today, there were repeated references to mccarthy hearings and joseph mccarthy. i don't know, maybe it's because i sit next to my good friend from vermont that i'm reminded of the other joseph. joseph welch who famously said at long last have you left no sense of decency. asked and answered. ms. conley, so grateful to you for your reference earlier about the importance of congress continuing to emphasize that it's not in europe's best long-term interest. thank you forgiving that
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characterization on the record. i would appreciate it, however, if you were comfortable associating some qualitative measure of that. we have a lot of risks that we have to assess that confront our nato allies and confront us directly or indirectly. how serious of a threat to europe's long-term interest and ours is the completion of nordstream two in your opinion? >> it's quite serious, but i would add it's also equally as serious a pipeline called turk stream that will increase the dependency on russian gas. i believe we should do everything in our power to convince our european partners that this is not in their interest. we are at a very fragile moment with our alliances. alliances are america's greatest strengths. and our adversaries know that. that's why, in fact, vladamir putin is trying to break those
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alliances, because that is our strength. we have to work this very difficult issue, but maintain alliance unity. and that's been very difficult to do from previous administrations as well as for this administration. but it's very important that europe breaks the dependency on russian energy. there's eu law that provides for that, but they have to follow that law. we have to keep working very hard to prevent this from happening. >> do the russians financially incentivize the germans to play along, you or the ambassador? >> i have to say, what we're seeing again across europe are deep, deep economic relationships that have been there for decades. these are difficult relationships to break. these economic relationships have great political support and patronage across the political spectrum in these countries. it is very difficult -- >> so the russians financially incentivize the germans? >> of course they do.
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>> an individuals? >> well, banks, and there are very notable individuals, like the former german chancellor that is a part of this. and we see this repeating itself in other countries, as well. >> have the sanctions on the gas had any effect in this regard? >> in terms of causing the specific transactional to -- >> i'm out of time. thank you, mr. chairman. i yield back. >> thank you, mr. heck. mr. crawford sh >> mr. chairman, i have a parliamentary inquiry. the gentleman asked unanimous content, and i objected, and yet you ignored that objection. >> mr. crawford, would you like
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to take a vote on that? >> that's fine. i have a list of quotes i would like to submit for the record. i can read them all or submit them for the record. >> you're more than welcome to submit them for the record. >> thank you, mr. chairman. mr. ambassador, in 1990, it was the first mcdonald's franchise was opened in moscow. you spent a lot of time in moscow. >> i had at that mcdonald's. >> and there have been several opened in that area since then. 2007, starbucks opened their first store. star bucks is not a franchise, it's company owned. so i raise that point to illustrate the difference between franchise and a company owned store. so there are some considerations there, wouldn't you agree? >> i'm not an expert on these
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companies, bhu thut that's true. the mcdonald's that opened in 1990, if memory serves me right, i think it was a canadian enterprise, not an american one. >> okay. have there been any american franchises opened up other brands since that 1990 time frame that you're aware of th this -- aware of? >> i want to be careful, i do not know. i did not do that research before coming here. my guess would be absolutely yes. there's several hundred. >> the world has just gotten so much mauler. there's american-owned businesses all over the globe. and whether they're franchise or company owned. so 2007, starbucks goes into moscow, and i'm sure there's been several starbucks locations since then. and now we have a presidential candidate, howard schulz. do you think he should come
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under the same scrutiny because he's done business there, opening up starbucks stores in russia? >> sir, i don't know the answer to that question. i think it's a great question. what i would say is, because i don't know what the business transactions were to open those starbucks. i want to be clear about that. >> i know generally that it is difficult. i know generally that there's sometimes compromising things that have to happen. but i don't know that was the specific case of starbucks. the second thing i would say is we should just call for transparency about that. so you actually know that those starbucks are there, and i think for all presidential candidates, we should know of all their business relations abroad. i think that's in america's national interest. >> i hope that comes to light. i certainly wouldn't want to see a presidential candidate that's not thoroughly vetted with international business given the
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context of what we've seen over the last couple of years. >> i couldn't agree more. one of the ways is to show taxes. >> and something else you mentioned in your opening comments, you mentioned that the russians influenced the 2016 election. that's an assessment i'm not sure you can make. i'm sure they attempted to influence, but that is entirely subjective the degree to which they were influencing american voters. isn't that fair to say? >> here's the way i would characterize it. there's been many great academic studies about this. here's my personal assessment of that academic research, okay? number one, just to remind everybody, there was a multipronged effort by the kremlin to influence the outcome of our 2016 presidential election. not just one thing, but many,
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many things that happened. number two, they had clear preferences in that race. when sputnik international tweets #crookedhillary, you don't need russian studies to figure out what they're trying to do there. and number three, i want to put my political science hat on, which i have spent most of my life as a political scientist and not a government official. i don't think one can isolate the independent causal influence of the russian factor set against all the other factors that the influence votes in the 2016 presidential election. so i'm not prepared to say that, unlike other people who have said that. >> in the brief time i have left, it's been less than two years ago, the former cia director brennan said before this committee the russians had been engaged in active measures to seek to influence elections in the united states for decades. do you agree with that? >> yes and no.
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i think what happened in 2016 was qualitatively different than any action of influence. >> is that attributable to something else? we didn't have twitter and facebook back in the 1990s. >> that's right. so that's different. we did have it in 2012. they didn't use it then. but without questions for me and my assessment, and this is my assessment i want to emphasize, the most important thing they did was not that. it was the doxing. it was the stealing of american property from individuals, and then publishing it. that's something they had capabilities to do before and chose not to do it. so i think it is true, this has always been their way. and i want to emphasize, it's not just the united states of america that is a target of these operations, watch what happens in ukraine shortly. but i think 2016 was a qualitatively different operation than previous elections. >> thank you.
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my time has expired. >> mr. welch? >> thank you very much. this is really extraordinary panel. and i'm struck with the clarity and the consensus among the four of you about the threat that russia poses. mr. mcconnell, or mr. ambassador, your opening statement was chilling in a way. the contest is now between corruption, state domination of the economy, and indifference to international norms versus democracy, rule of law, free markets, and respect for international law. and i take it there's a consensus among you about that characterization. and professor conley, you also said i thought was very, very powerful about this is about the strategy of influence, not force.
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and it exploits any societal weaknesses in divisions that we have and it can get in your head. and ambassador, what you were just describing, which is qualitatively different, is what is chilling to me. until i was a member of congress and watched this, i was not as aware of the depth and aggression that has been behind this until i am now becoming a student of it. i say that, because i suggest that everyday citizens are trying to figure out how to get through their day, get their kids to daycare, and this is not forefront on their mind. so aside from this question that is the political debate that we're having, is it essential for our security that we have a consensus in the american body politic about what a dangerous
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adversary and determined adversary, russia, is, to our democratic values. i'll start with you, ambassador. >> the answer to that is yes. and let me say a couple of things if i may, number one, i was raised earlier, i think somebody was quoting mike po morrell, this was a violation of our sovereignty in 2016. but unlike 9/11, we didn't have a bipartisan commission that investigated what happened. by the way. investigated what the bush administration did. i'm a former member of the obama administration. i think that should have been interrogated, too. we didn't do that, and we haven't even got to the prescriptive part. so i would just associate with that. number two, putin is a person i have known. i met him first in 1991. i have written about him a lot. we're not exactly facebook
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friends. he doesn't like me, i don't like him. but what i would note, as somebody who has watched his career, a couple of things. one, he thinks that we have ruined his country. but two, with time, he's gotten way more aggressive. he's taking bigger risks. so annexation, 2014, intervening in syria, 2015. intervening in our elections in 2016. trying to arrest americans. remember, that's what happened in helsinki. those are riskier actions. i just want to make sure that we understand the nature of this threat is growing. >> that would suggest there has to be -- whatever our divisions are and debates here, this has to be some unity coming from our state department, from our executive branch and from our congress that whatever our divisions are, this is a threat to all of us.
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you talked about krurpcorruptio how that undercuts democracy. >> i do have a lot of speaking to groups across the country. the american people do not understand the totality of the challenge, and it is a strategy that is working with inside of us. after the poisoning where a chemical agent was used on nato territory, russian disinformation provide over 46 different explanations of what that could possibly be. if you're an average citizen trying to figure out who, what, when, where, how, nothing is true, and everything becomes possible. that was followed up by the russian hacking of the organization for the prohibition of chemical weapons to try to alter the results of that. this is what is at stake. during the active measures during the cold war, the american people knew who the enemy was. there was training and understanding of this.
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there is none of that -- >> i only have a couple of minutes left. there's arms control treaties in our defense department, but what i'm hearing that you're saying is that we, number one, have to build our alliances. and number two, we have to express great clarity about what the threat is. would you agree with that? well, i want to thank you. >> the other thing i would say, vladamir putin is neither a republican nor a democrat. he does not care. all he cares about is that we become divided and split. and he will continue to work in unprecedented fashions to that end. what happened in 2016, and what i think we can expect to happen in the future in terms of their active measures, their hybrid warfare, is indeed unprecedented. and there's going to be more 9/11s from russia. and we have to figure out how to deal with that. >> thank you. i just want to say, mr. chairman, i would be interested in us taking up some of the
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suggestions about illegal moving of money. i yield back. thank you very much. >> thank you, mr. chairman. i want to thank you for your long careers of commitment to this country. our foreign service often times gets dragged into the mud, and they're doing incredible things in hard places and most people don't understand what it's like to be targeted by the russians the way you do. mr. hall, our colleagues are colleagues that have to deal in denied areas and work in tough places dpeps an insurmountable foe. most people can't understand that, nor will they ever understand that. you do and thank you for bringing your attentions to this. and ms. conley, thank you for the unsexy work of getting into the details about some of these issues that help inform folks
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like us. and while i do have a question, i must associate myself with the gentleman from texas in his letter. prior to the 2016 election, i was calling for ambassador kislyak to be png'd from this country. prior to the 2016 election, i was trying to say how this sustained covert operation by the russians had to be addressed. grisly stat refers to attempts by the russian government to influence our election is going to go down in history as the russian's greatest covert operation. why? because their goal is to erode trust in our democratic institutions. it is to erode trust in the american people and the intelligence services. to erode trust between the intelligence services and the
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legislative branches. to erode trust between the legislative and executive branch. and i've sat here for 22 months. and having many of my colleagues question our side of the aisle's commitment and understand that russia is a threat. it's clear, republicans and democrats agree the russians attempted to influence our election. they are doing it in our media, they are going to continue to do that. so when we question that, when we imply that there is not an agreement on that particular issue, we are falling into the trap of eroding trust in our institutions. and we have to change our behavior. we have to get at this threat, because they are continuing to do it, and they're very good. and we're not prepared for that. and mr. hall, my question for
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you. who is responsible for countercovert influence? and who should be responsible for that? in the u.s. government? >> i think given how the russians have evolved in terms of their capabilities, their hybrid war for their influence operations, i believe that it now in the united states needs to be an all-government approach. if such a thing is possible. obviously we feed to have certain folks taking the lead. the intelligence community has to inform what's going on. there's a military component to it. because i think we need to protect critical infrastructure. but it touches -- the way the russians are doing it now, it touches so many parts of our government and our society that it has to be a widespread thing. so unfortunately, i don't know that i can name one person, one agency, one organization to do it. it's too broad now.
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>> thank you. ambassador mcfall? >> all of that said, i want to make sure in my view we understand that the answer to your question is not just an spell question but a policy question. the president of the united states needs to stand next to vladamir putin and say, we know what you did in 2016, and if you do it again, these are going to be the consequences. and until the president of the united states doesn't do that, it's not good enough nor the rest of the trump administration to try to do that. i know a lot of those people and i think they have a good policy towards russia, and in some of the things they were better than us, than the obama administration. but when the president of the united states, standing next to him, sides with putin and not your former colleagues, that does the very damage you described. >> mr. mcfall, i've made my opinions on this topic very clear. but what i will end with bf i yield back, mr. chairman, i left
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the job as an undercover job in the cia because i was disgusted with the things i had to do and the lack of knowledge that congressional leaders had, and when i had to brief them when i was overseas. i felt that there were people in congress at that time that were going against the opposite of what my friends and my colleagues were doing, not just in the cia, but in the military, in our foreign service, and i was disgusted with that, and i said, i've got to try to do something about it. and it's great to be able to help the intelligence community in a different way by serving on this committee. but what we need to do is top with the innuendo and implying that we have access to something we do not have access. mr. chairman, i yield back. >> i thank the gentleman.
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i wanted to mention to my colleague, that in the last session, the majority produced a report that suggested to the american people that the intelligence community's conclusion that russian had intervened, and in fact, intervened to help one candidate and hurt the other, should be subject to doubt. that the intelligence community didn't use the proper trade craft, that conclusion should be called into question. i don't think that was in the service of the country. i don't think that's reflexed in any of the intelligence. i don't think that's going to be reflected in bob mueller's report. and that was the unanimous opinion of the then majority. every member of this panel, who was a part of that, signed that report. and i fully concur that we need to be very clear about russian intervention. we need to all condemn it on a
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bipartisan basis. we should show no daylight in that. we'll never know whether that intervention was decisive in the election. i never suggested it was. we don't know, and our intelligence community, though the president has represented that's what they concluded, that's not their job. that wasn't their conclusion, it's beyond their role and capability to predict election outcomes. >> would the gentleman yield sfwh back? >> yes. >> is it normal for the director of analysis for a senior analyst involved in a subject matter to be excluded from the review of all source intelligence on that subject? >> we can carry on this conversation, or we can ask the experts whether they have any reason to question the intelligence community's assessment that the russians
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intervened on one side and not the other. shall we put it to the witnesses? >> i doubt they will have the opportunity to speak on classified materials. but i would love to talk about the process on how intelligence has been developed and how all-source intelligence should be developed. and, again, there is no question about the ica assessment about the russian's attempt to influence our elections. but trade craft, standards of trade craft are standards of trade craft. when there's a deviation from that standard of trade craft, we should understand why. >> if you'll indulge me. let me ask the witnesses, does anyone on this panel question the intelligence community's finding that the russians intervened in our election and did so for the purpose of helping one candidate and hurting the other? >> would the gentleman yield to an additional question? >> i would like the witnesses to
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answer. anyone question that? ms. conley? >> no, i do not question it. >> ambassador? >> no. >> mr. hall? >> no. >> you are recognized. >> mr. castro, would the gentleman yield for 20 seconds please, sir? >> sure. >> i would love the gentleman asking the question if any of the panelists knew how the ica was developed and whether their understanding of the process on which it was vetted through the intelligence agency. i yield back. >> i'll let him answer your question. >> i have no knowledge of the process. >> neither do i. >> i have no direct knowledge, but it would be difficult for me to imagine that the heads of the intelligence organizations would stand up and vouch for it if there were not some integrity to it.
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but that's speculation. >> likewise. i have no knowledge of the process. >> thank you for y'all's testimony today. i wanted to ask you about sanctions and their effecti effectivene effectiveness, and whether sanctions in the long-term will have an effect on vladamir putin's grip on power in russia, and how they're affecting his hold on power in russia. >> congressman, i'm on the pessimistic side of our sanctions regime. as important as it is to continue to place those sanctions. i think in many ways, president putin has used these sanctions as a method of weeding out those that are not loyal to him and more loyal to their bank accounts in the west. he has renationalized important parts of his economy. what he recently announced and met with some significant protests in russia, he's unplugging from the international system, because he understands the vulnerabilities. so he's removing himself from
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the online iron curtain, because he knows we have cyber counter capabilities. they are trying to develop now -- we're see thing across the board, the exhaustion of sanctions that they're creating a separate financial system, so if the most extreme option if we were to eliminate them from the international, financial transaction system that they would have additional resources to be able to withstand that. so there is a system to prevent the sanctions from impacting them completely. and i think this is where what we are suggesting in our report, we now need a new set of tools to actually prevent russian money laundering from being housed and sheltered in our systems. and that could be a very robust way of responding to russian aggression in as many forms.
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>> i think there is a risk of what are termed as sanctions atrophy. one, evasion techniques. the russians are good about using front shell companies and getting better. so in the last two years, you have seen significant innovation. the other issue, which i think this important to flag in terms of the long-term consequences and long-term impact of these tools in russia in particular is that the longer that the european union maintains its sanctions program, the less likely that over time they're going to renew. the way the eu sanctions work is that there is a six-month period. at the end of that six months, they have to renew. as time goes on, and as the sanctions don't seem to be having a significant impact and change in russian behavior, you're hearing increasing calls from eu member states to not renew. because it's a unanimous decision, if there is the opportunity to peel off one or
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two significant european countries, you could see a significant fracturing of the transatlantic unity on the sanctions regime. >> thank you, ambassador? >> just a couple of comments. i think it's wrong to assume because putin hasn't changed his behavior that russians support sanctions and support putin. many of the people on the sanctions list, i have to see them in third countries now, as i talked about, because i'm on the sanctions list. but i think it's important to understand that there's a real division among them about the wisdom of the belligerent behavior that putin did and they're suffering for. they'll tell you that privately. but for all the reasons we've been discussing, they would never do that publicly. but remember, that sentiment is there along the elites. number two, polling data is flawed. most of the polling companies are controlled by the government and remember, it's a heavily surveilled country. so when you're sitting out and
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you're called from moscow and they say hey, what do you think of putin? there's only one rational answer to that, you support him. that said, even with that flawed data, his numbers are going down. the rallying around the flag effect of the war in ukraine, and calling us the enemy because of sanctions, that is dissipating. in russia, they talk about the divide between -- the fight between the television, which is the propaganda, and the refrigerator. i would never be so unwise as to try to predict when that moves in a way that changes his behavior. but the numbers are moving in this way, and there's a real despond ya despondency in russia. >> thank you, mr. chairman, for your dignity and strength in the face of some truly ridiculous
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remarks made this morning. and i think it's ironic that our colleagues on the other side bristled at the notion that they didn't care as much about russian influence in our elections, and yet not a single one of them remains to join the conversation with some of the leading experts in the world. i think that speaks volumes. i also think that if their position is that the improper, unethical and unpatriotic conduct of the president wasn't criminal and that is cause for celebration, i have a different view. i appreciate the questions asked about that. gentlemen, and ms. conley, thank you so much for your appearance here today. we do value your expertise. we depend on it. thank you for your service. my question, ambassador, you
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spoke about the prescriptive measures that we should be taking. what would this look like if you were advising the president today and that president would follow that advice, what are the top two or three things we're noting to now that we should be doing? >> thanks for the question. we'll have a big report with a group of stanford colleagues coming out shortly. we briefly summarized it in a piece in "the washington post" that was published yesterday with one of your members. let me just go through a couple of the things. started with the most important. cyber security infrastructure for our electoral infrastructure. we've done some measures, but not nearly enough to make sure that the votes that are cast are the ones that we are able to count. and even on the voting roles by the way, remember, russia doesn't have to do -- i don't want to say russia. putin. not all russians -- let me just
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add a footnote to manage i said earlier. i athink it's very important to remember not all russians are corrupt. there are many russians doing legitimate business with americans, and we need to be precise when we talk about that. because i was not precise earlier. but back to this, they don't need -- putin doesn't need to steal 78,000 votes, right? all he needs is for a few thousand people to show up to vote and their name is not on the role and then there's camera crews and what's going on. that will undermine the integrity of the election. we have done very little on that. number two, basic cyber hygiene for people that work on campaigns. i don't want to put people on the spot, but there are very simple things that people can do. fu number three, deamplifying what
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happens on the social media platforms of these campaigns. notice i didn't saban they ban . but i interact with all those companies in the silicon valley, and i think there are ways that can deamplify when they expos those things. but then number three or four that i'm on, one of the things they would say if they were here, we didn't know about the activity on our platforms, because there was not enough coordination between the intelligence community and the private sector. and segt up that coordination with third parties involved to make sure there's no conflict interest, that would be another thing to do. another really big debate we have to have is what is the norms of allowing foreign governments to participate in our electoral procedures? i said earlier, sputnik international completely controlled by the kremlin tweets out #crookedhillary. that's obviously trying to influence the campaign.
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what do we do to prevent that? i could go on. >> and that's very helpful, but i guess i would invite you and others to join in. in terms of more significant responses by the u.s. government, i mean, those are prophylactic measures, but should we have a red line on cyber attacks in this country? should we make it clear that if a bomb went off at the dnc and the russians did it and they should expect a response. and if they engaged in this activity they should expect a response, and what could we do to bloody their nose so they wouldn't do it again? >> the answer is yes, that's deterrence. there may have been more of that in 2016 than we know on the record by the way, because the obama administration was very focused on election day. what would the contours be? i would want to be careful about commenting on the record about that. in many ways it's important to have that conversation off the record with the russians.
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but you can't have it if you're not acknowledging that the russians did it in the first place. i think the first step would be for the president of the united states to acknowledge on the record what happened and say that there will be consequence and talk about those consequences privately. one other thing i want to say, i want more transparency about interactions with russians and other governments. we've been focused on russia rightly, but there are other actors out there that have an interest in destabilizing our elections. i don't want to ban interactions between americans and foreigners, including russians. but during campaigns, we should require through norms or other maybe even legislation transparency about those interactions. >> congressman, what we heard repeatedly, the united states government has to restructure fundamentally for this challenge. we are set up to fight terrorism. we are not set up to fight
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malign influence, perfected by russian state craft today. this is not going to go away. this is our vulnerability. so there has to be a fundamental restructuring, which includes intelligence, and includes the seam between domestic and foreign. that's where this falls into, and that's where we have important laws to prevent and make sure there's a separation. but that's where they're working. we have to inform the american people. again, to the congressman's point, we have to talk about this. so americans are literate and armed with what's going on so they can read their news feeds in an educated way and understand what's going on. and third, and this is what's been missing for quite some time, we have to have an offensive strategy. once we return our confidence in our democracy, ronald reagan said we have to return to the city on the hill. we want for the russian people what we want for the ukrainian
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people, which is freedom to choose their leaders and way of life, however they wish. we haven't been on offense for a long time. that's what won the cold war in my ways. we helped solidarity movements, we told them we stand for something better. that's what's been missing in our strategy. >> my time has expired. if the chairman would allow mr. hall to respond. >> just two brief things. i agree with everything that mike and heather said. we have to make the russians, and specifically vladamir putin understand that the price that he would pay, that russia would pay would be exceedingly high if they attempt something like that again. the details as to how that happens, hopefully is already under way in our government. but that's one thing. the second thing is, we have to do it in coordination with our allies. that amplifies it so much nor. the devil is in the details. but that's what i would recommend. >> thanks. i would say that we need to work
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to deputize the private sector. there's a lot of focus on what the intelligence community and law enforcement can do. those capabilities are tremendous. one of the greatest force multipliers we have are individuals in financial institutions, throughout the world, looking for this type of activity every day. hundreds of thousands of people. to the extent you can provide them with the tools, whether it be legal authorities or obligations to pull information, that' it shows or helps better illustrates how russia is attacking our democracy, that's important and will pay significant dividends above and beyond what we have. >> thank you. >> thank you, mr. chairman, and thank you to all of our witnesses for being with us today. you know, as a former law enforcement officer, and now a member of congress, i think often about a quote that says
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the only thing necessary for the triumph of evil is that good men do nothing. at the beginning of this hearing, the chairman outlined the list of behaviors that i believe any reasonable person would find inappropriate, especially as it pertains to our national security. that is a number one concern for me. however, my colleagues on the other side of the aisle have lamented over the suggestion that they don't care about those behaviors. well, as a former police chief, when inappropriate, criminal, unethical behavior was brought to my attention, i did something about it. you don't sit silent and do nothing and work hard to either find a technicality to discredit the witnesses or remind a former
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ambassador to the united states of america that he's under oath. you don't do that. you work diligently in the pursuit of justice and protecting this country. you hold people account able who engage in wrongdoing regardless of who they are. so this -- i'm delighted to be a member of congress, but disappointed at the direction that my colleagues on the other side of the aisle, we've got to do this together chose to take this morning. there is one team for this committee especially, and that's to protect the american team. with that, thank you for allowing me to get that out. it's been painful. ms. conley, and mr. hall, are there any notable instances of the kremlin using maligned financial influence abroad that
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have not been discussed yet, that we haven't had the time to discuss, that you would like to? >> well, the report that we passed out to you, it really dives into at least the use and focusing on concentrated sectors of energy, finance, real estate, how it works, how it me taste si >> how it grows. i welcome you to read that and if there's any questions that we can follow up and provide those that have been on the front lines, many of our european colleagues have watched this for quite some time. so i'm happy to give you the specific details. >> mr. hall, any in particular? >> i have less specifics. the russians do not hesitate, would never hesitate to use any of their intelligence services to identify individuals and organizations where they see an opportunity to carry out that type of malign activity.
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again, it's a different system than we have here. our intelligence agencies here for the most part collect information for policymakers. in russia, they collect it to do precisely that type of malign activity. >> thank you. again, ms. conley, is there anything in our financial, legal, or regulatory system that makes the united states particularly vulnerable to tactics used by the kremlin? >> so the one we certainly highlight is the incorporation, we highlight the netherlands, which is a vast corporation. we can see similarities in the state of delaware to be honest with you. so it's not pointing the fingers, it's a shared issue that we have to greatly heighten transparency. this is legislation that's been around for quite sometime. i hope we give you all the national security imperatives. we also argue in our report that what we need is basically a
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financial intelligence and reconnaissance system. i'm using the terms of warfare. that's how we allow our military to have a common operating picture, where they can see the different aspects of it. we need that financially to see where the red light is slipping, which is being, you know, buying real estate, you know, using the malign influence to fund political parties and other activities to help harm the nation. so we have to create a better common operating picture. this gets back to my concern about we're not structured to do this, exactly to eric's point. this has to be a shared public private partnership. the banks want help in doing this, because the problem is so massive. on cyber, the same thing. the technology companies want a partnership to try to combat
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this malign influence. it's very evasive and very difficult to root out. >> thank you. >> just one quick point to underscore something steve said a couple hours ago which is very important analytically. don't put the western lens on how russia works. the way that we think about it. so we have some lines of authority, and lines of jurisdiction between what steve used to do and what i used to do, right? russia doesn't have that. it's all blurred. and there's varying degrees. the president of russia is also a former kgb officer. and everything therefore is blurred. and just always constantly remind yourself when you're looking to understand what's happening here, it's a very different system, completely dominated these days by the russian intelligence services. >> thank you so much. mr. chairman, i yield back. >> thank you.
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mr. heinz? >> thank you, mr. chairman. i'll associate myself with the xen comments of mr. maloney, and i'm glad he brought senator mccarthy into the conversation. history will clarify what has happened and some of the smaller details will be alighted. but if my republican colleagues are betting that the chairman, who is a good friend to all of us and a man of deep, deep integrity will play the role of joseph mccarthy in this historical interpretation, rather than a president that calls the press the enemy of the people, who attacks the fbi, cia, and discredits them when they don't provide information consistent with his personal interest, who says there are very fine people on both sides of a nazi march in
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charlottesville, if that's their bet, i will take the other side of that bet. mr. chairman, thank you for your spirited response. with that, to the panel, thank you for being here. i want to take a little bit of time to get a little more detail around the role the russian banks play in this. i want to read a quote from a buzzfeed document dump. it's a letter to michael cohen, and i'm going to read one line in reference to trump tower, and it's not trump tower i'm concerned with here. but mr. seder writes, putin's top finance guy and ceo of the second largest bank in russia is on board and top finance ceo on russia is on board and has indicated he would finance trump moscow. "of the sort of implies that
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there is a rich and deep partnership between the kremlin and this bank. i also was personally involved in the lifting of sanctions on rousseau which involved gary costa transferring 14% of his ownership in en to vet bank. the or two faxed that shows what feels like a family relationship between the kremlin and banks. let me start with mr. conley. i think this is your area of expertise. can you just talk a little bit about how that relationship -- kremlin controlled banks and also banks that are maybe not kremlin controlled with respect to providing financing for projects providing support to oligarchs and maybe even doing the service of the kremlin as is implied in the letter here. >> thank you. i am actually not a russia specific financial expert. my understanding is, as he laid out, there is a very close
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connection in the way that russian oligarchs are able to act with financing from entities but i will refer to the other witnesses on the question of how specifically those mechanisms are working. >> ambassador. >> i can talk about that. it was part of my job as the u.s. ambassador to help us understand these kinds of activities. i think it is important to understand that dtb is a complete we controlled bank -- i'm not even sure bank is the right word. even the language, i'm not sure we should be using. but we do whatever -- the president called them to do. they had other aspirations at dtb and dtb capital and other aspirations to privatize. i know that was a plan they had years ago. all of the plans have been set aside. the thing you are quoting is very consistent. i don't know the specifics of the case.
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i want to be clear. it would be consistent with the general way that i know that the kremlin works with the three major banks. >> mr. conley. >> the research looks at how russian influence manifests itself in europe. our expertise looks and some ways that how that financing goes through european institutions. for one example, before the 2014 european parliament elections, we saw where russian finance went through the first check russian bank to provide funds to a campaign prior to the election. we are also watching how europeans actually -- this is for unit credit, italy's largest bank and also austria's banks are growing in size within russia. we did not think we would anticipate that five years after the annexation of crimea. but actually european state
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owned champions, energy and banking, are actually growing in size and that creates a risk to them. so my knowledge comes from how the european banking structure is amplifying a lot of the russian financing. >> i am out of time but a quick question. it sounds like one of the things we should do and maybe other committees in the congress should do is investigate or at least propagate the idea that if you secure financing from a russian entity, there may be strings attached. it could ultimately be used -- and i am looking at you mr. hill, as a mechanism of compromise and therefore be a counterintelligence concern. is that fair? >> i think your description of it being a family affair is good if you recognized the family. it is like a mob relationship. it is not to say that all business contacts with banks are false and are somehow suspect but they could be
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compromised at any moment with that phone call from the kremlin. >> i would say on that case, when i followed fairly closely, two things. one, when people say that sanctions don't work, they most certainly worked with him. he lost billions of dollars had allegedly -- in the reporting, spent hundreds of thousands of dollars to get off of the sanctions list. so remember that. number two, i think we need to understand how we got off the sanctions list. you mentioned the restructuring done. it was very mysterious to me why that was done because it has always been my view as a former policymaker that sanctions are put in place to change the behavior of the target country you are sanctioning. putin has not changed his behavior. yet for some reason, the sanctions were listed on these firms.
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i think we should know more about how that happened. >> i agree. >> thank you mr. chairman. let me just complement you first of all for holding this hearing in the open so that the american people can begin to understand the threats that russia has against our country. let me also say that you showed extraordinary restraint with some of the viciousness that was exemplified by regrettably some of our colleagues on the other side of the aisle. i also note that, as does my colleague, that no one is here from the republican side of the aisle. that is very unusual. usually there is always representative of the republican side of the aisle at hearings. i think it suggests a bit of stuntman ship that went on earlier. let me also point out that the letter specifically says that
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the mueller report outlines the russia efforts to influence the election. clearly stated. we don't have the underpinnings of that yet but we should all wait to see that. the report by the republican majority at the time said -- and i quote "the intelligence community assessment -- of putin strategic intention did not employ proper analytical trade class." on one hand, they will accept the mueller report but the own report -- their own report suggested it was inadequate. let me just ask ms. conley -- thank you so much for your work. i am curious about the bank in austria. you spent a whole chapter on austria and the banks. could you expressed to us the relationship of russia to the bank? >> it is a general pattern that we see a close
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relationship that has been in the makings for decades. this is in some ways, austria's very unique role in being neither east nor west neutral. they were able to do quite a bit of trade. what we are seeing in the banking structures is really austria's ability to amplify the russian funding and take it elsewhere within europe. so austria is very powerfully placing the banking system across central europe in the western bulk in. and to be honest, why we did the second research book, the kremlin playbook two, is because we kept seeing austrian firms, banks and energy firms repeatedly appearing throughout the first research. so we wanted to take a deeper dive into two types of banks. raiffeisen bank because of the size and the importance to the region. amplifying non- transparency. and austria has very unique and
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special -- new mic. >> the bank actually funded a toronto trump project for $300 million. and never came back after that project was bankrupt to secure what it could and bankruptcy in terms of the return of the funds. is that commonplace? >> congresswoman, we have studied how it works within europe. we did not identify any specific structural arrangement outside of europe. >> thank you. ambassador, thank you again for your outstanding comments today. to what extent is putin personally aware of russian individuals who are engaged in money laundering in u.s. real estate? >> i don't want to speculate. i don't know for sure. he most certainly would not share that information with me personally. but knowing generally how the system works, i think he would
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be acutely aware of those kinds of things. he is a man of detail. i was always struck by that and my interactions with him when i was in the government. usually accompanying president obama or other members of our administration. so again, it would be consistent that he would know about those things but i don't know for sure. >> mr. hall. >> i think the term acutely aware is a good term. anything that is of critical importance to him, splitting the united states and dividing us, he would take a great interest in. >> so if the number of lcs are created that are based in which ownership of the real estate in the united states is by russians, there is potentially a likelihood that putin knows about it? >> there certainly could be. >> would putin ever authorized the purchase of u.s. property at an inflated price
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mr. ambassador? >> i know the case you are talking about. and i don't know the answer to that. it is a great question. we should get our intelligence community to get you to get the answer to that. i personally don't know. >> mr. hall. >> that would be consistent with how the russian intelligence services function. >> thank you mr. chairman. >> are there any further questions from my colleagues? >> yes. >> can i ask one last question. i think the comments that many of you made about the poorest in us our election system and the russian ability to not only get into the voting rolls but conceivably into the voting machines, is something that the american people really care about. and yet, it has not gotten the attention it deserves. we have four companies that basically have a lock on all the voting machines in this
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country. there are no requirements for audits, paper ballots or the kind of optical scanning. do any of you have confidence that the russians would not -- maybe i am saying this wrong. knowing that and the vulnerability, is that something that clearly the russians would take full advantage of if they could? >> yes. they absolutely would. in fairness to those companies and others who are trying to do these protective measures, which are important defensively, we have to understand the way the open society is set up and the way the internet functions, it is designed to share information as efficiently as possible. this is a real struggle when you are trying to protect critical information. having worked in an organization that really wants to protect its information, it is a really hard thing to do when you are talking about systems that are designed to share. how you get around that -- how you defend against that is
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a difficult thing. but i don't think you can do it unless you also have the offensive thing we were talking about before, letting the russians know, we are going to defend but if we catch you, the price you are going to pay is brutal. that 1-2 thing is the only thing i think we can do. >> looking at what europe has done, it is the redundancy of the paper ballot that is absolutely essential. in fact, in many european countries -- and it seems so archaic to what we should be doing and the fantastic technology we have. but they do require that redundancy of paper, just to make sure. again, it is about ensuring confidence that every vote is there. i think there could be some redundancy to that process. >> if i can just add to that. absolutely a paper trail for every dollar. it seems like a complete no- brainer. and that we have not done that yet is shocking to me. i want to remind you that there are a lot of other actors
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copying the putin pay book -- playbook now including domestic actors and we need to be aware of the fact that we could have multiple actors trying to disrupt the elections in 2020 and that is why i think it is so vital that we focus on these prescriptive measures right now. >> thank you mr. chairman. >> thank you. ambassador, on that point, one of the issues our committee is investigating is the development of the deep faith technology. my paramount concern during 2016 as we were watching what the russians were doing in realtime -- the hacking and the dumping of these documents as if they would dump forgeries among the real. that concern now is heightened exponentially, given that the new technology would allow the russians or any other foreign actor or any other malicious domestic actor to push out in proximity to an election, video or audio which is completely a forged product. but nonetheless, has all of the
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and nisha of veracity and reliability. when we consider just how disruptive that would be -- >> the russians don't need to hacked the elections infrastructure although it is all too vulnerable. pushing out that kind of false content could be far more influential. and we are in a race right now if technology. the technology to develop deep fakes and the technology to detect them. i am deeply concerned, given just how polarized the country is and the electorate is and indeed the committee is, that our ability to respond to that is very much in doubt. psychologists will tell you that when you have seen a video -- that the video is a fake even if you are persuaded intellectually.
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you cannot undo the impression and the lingering impact of that. so we are entering a brave new world. and what we need is a whole of government approach that looks at what each and every agency is doing to protect the country and to protect the integrity of our democratic institutions, that is working collaboratively and talking with each other. we need the public to be more critical of what they learn on social media. and this needs to be a comprehensive effort. your testimony today has been very helpful in informing us of the task ahead and i want to thank you for appearing today and more than that, i want to thank you for your service to the country. we are adjourned.
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>> sunday night, former trump advisor george papadopoulos details his role in the 2016 presidential campaign in his book. he is interviewed by a wall street journalist reporter.
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>> i was actively trying to leverage what i saw where the connections to russian because i believed it was in the interest of the campaign for trump to meet with the vladimir putin. thought that was a primary foreign policy objective? >> yeah, donald trump had been a spouse and four months the needed to work with russia at a geopolitical level to combat isis. and 9:00afterwards p.m. on the book tv on c-span2. >> the only thing we have to fear is fear itself. ask not what your country can do for you ask, what you can do for your country. >> and the people who knocked the buildings down knocked all
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of us down. book, notednewest historians rank the best and worst chief executives and provides insight into the lives of the 44 american president and historians gathered by interviews. explore the life events that shaped our leaders and challenges they faced and the legacies they left behind published by public affairs, c-span's the president will be on shelves if the third but you can preorder your copy as a hardcover or e-book today at presidents or wherever books are sold. hill, the house will consider reauthorization of the violence against women's act which expired in february and and to prevent abuse and provide resources for victims and includes a provision on domestic
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violence and firearms. it is also possible that members will take up a resolution to end the u.s. involvement in yemen and in the senate, work continues on the bill that would provide nearly $13 billion in aid for those affected by natural disasters. a resolution that would shorten the amount of time the send continues -- considers certain nominations. watch it on c-span is c-span2. >> the white house did not release a weekly address from the president and senator candace smith of minnesota gave the democratic address discussing the mole report and climate change. does the rubber report and climate change. the robertth: -- mueller report and climate change. -- senator smith hi, i am tina


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