the centennial celebration of the women's suffrage parade from 1913. sunday at 7:00 p.m. eastern on c-span3. robert mueller testifies on the 2014 agency in talks about the effects of spending cuts under sequestration. he also talks about terrorists separate threats -- threats. this is one hour a 45 minutes.

>> we have zero votes coming up. i will not have an opening statement other than to say i want to take this opportunity thank you and the men and women of the bureau. i think you have done an excellent job. i think you have done an outstanding job. iwanted to know that personally appreciate it. andink the members up here the american people as well. i want to thank you and your family and the men and women of the bureau. i think you're represented well.

we owe you a debt of gratitude. >> i will also for the opportunity of a -- of an opening statement in lieu of the directors time. i join in the remarks of the chairman. >> pursuant to the authority granted in section 191 of title 2 of the united states code, today's witness will be sworn in for testifying. if you will rise, i will appreciate. raise your right hand. do you solemnly swear and affirm that the testimony will give will be the whole truth, nothing but the truth, so help you god. but the record show that the witness answered in the affirmative. you may be seated as a print. -- as appropriate. >> i have a relatively short opening statement of like to give. mr. chairman, i thank you for your kind words this is about the men and women of the fbi accomplished so much in the

last decade. i thank you for the opportunity to be here to represent the men and women of the fbi. i also want to start by thanking this committee and result in particular for the extraordinary support you have given to the fbi over the last decade. we live in a time of diverse and persistent threats from terrorists, spies, cyber criminals. at the same time, we face a wide range of criminal corruption. just as our national security and criminal threats constantly evolves, so too must the fbi to meet encounter these evolving threats. we look forward to one additional challenge, this the ability to maintain our current capabilities to these threats during a time of constrained budgets.

today, i spent a moment to connect our highest priority, national security and criminal threats. terrorists ruined our top priority, terrace with global reach and global ambitions that seek to strike as at home and abroad. the opera today in more places and against a wider array of targets than they did a decade ago. we have seen an evolution in cooperation among terrorist groups. in the past decade, corps al qaeda has been weakened, but the group maintains its results in attacks against the west. al qaeda and the arabian peninsula represents the top counter-terrorism threat to the nation. in light of the recent attack in north africa, we're focused more than ever on are merging extremist groups capable of carrying out attacks. we also remain concerned about the threat of home-grown violent extremists. over the past years, we have

seen increased activity from extremists conspired to the internet and individuals tied to domestic terrorist groups who have continued to oppose -- have continued to pose a persistent threat. these individuals pose unique challenges for law enforcement as they have no profile and their experiences and motives are also -- are often distinct. for a moment, i would like to discuss the cyber threat, which has evolved over the past decade. cyber criminals have become increasingly adept at exploiting weaknesses in our networks, and once inside, they can infiltrate government and military information, as well as our valuable and -- intellectual property. organized criminal act cyber send the kids and in deal -- ideologically driven activist groups. willieve the cyber threat be cool or eclipse the terrorist threat in the future. we are enhancing our capabilities. we have focused our cyber division on addressing computer intrusions and network attacks.

each of our offices have become cyber task forces. we're cloud there -- collaborating and sharing with our federal partners more than ever in the context of a national cyber joint task force, which has 19 military, law- enforcement agencies working together to stop current attacks and prevent them in the future. we also recognize that the private sector is the essential partner of if we are to succeed in defeating the cyber threat. i have undertaken a number of initiatives to build better bridges with the private sector in order to protect our critical infrastructure and to share a threat information, initiatives such as a domestic security alliance council. as noteworthy as these outreach programs may be, we must do more. we need to shift to a model of true collaboration with the private sector, building structure partnerships in the government and private-sector, and we must develop channels for sharing information and

intelligence more quickly and effectively between these two conclaves. turning to our criminal programs, i will describe a few of the most significant threats. a violent crime, gang activity has exacted high tolls in our communities. according to the national gang threat assessment, there are more than 30,000 gangs with more than 1 million members active in the u.s. today. we identified and target the most serious gangs operating as criminal enterprises. the continued violence on the southwest border remains a significant threat. we rely on our collaborations with the dea, el paso intelligence center to track and disrupt these threats. at the same time, the fbi is vigilant in its efforts to remove predators from our communities and to protect our nation's children. our ready response teams are stationed across the country to react quickly to child

abductions. through our rapid deployment teams, the innocent images initiatives, we're working with our partners to keep our children safe from harm. let me close by saying a few words about the impacts of sequestration. according to our current estimates, sequestration would reduce the bureau's budget by more than $550 million for the remainder of this year. because 60% of the fbi's budget pays for personnel, and they are our resources, we have plans for the possibility of furloughs. any furlough would pose a risk to fbi operations, in particular in the areas of counter- terrorism and cyber. other exhausting all options first in an effort to

reduce any potential for lows for our work force. this fiscal year, we are understanding we're looking at furloughs' down the road, particularly in fiscal year 2014. in short, our people are our most important asset and resources. without them, we risk a slippage in ongoing operations and investigations that could undermine national security and the enforcement of federal criminal statutes. the impact on non-personal resources will be significant, among other impacts. the fbi will have to forgo i.t. upgrades. your databases will be pulled into our search tool capacity for use by agents and analysts. we will be unable to obtain all the technical surveillance tools we need to keep pace with our adversaries. we will also face challenges in meeting our mission requirements in areas of increasing threats such as cyber. winners stand there will be budget reductions this year and in years to come.

we would like to work with the subcommittee to mitigate the most significant impacts of those cuts. german, ranking member, members of the subcommittee, i would like to thank you again for your support of the men and women of the fbi and its mission. our transformation over the past decade when not been possible without your cooperation, assistance, and support. i would be happy to ask any questions you have. >> thank you, mr. director. i share your concern. until congress and the obama administration, together to do something bold like the simpson- bowles commission, this will continue. domestic discretionary accounts are being squeezed. entitlements are rising. you make a powerful case against sequestration on friday, received a reprogramming a request from the eternal -- attorney general moving funds,

including fbi funds to the bureau of prisons. we are going to approve that. you have had one prison guard killed. you had another commit suicide i think because of the death. how are you planning to function at reduced funding levels for this year? >> we are cutting back across the board. we have a hiring freeze. by the end of this fiscal year, we will have 2200 opened vacant positions. we delayed i.t. upgrades, which are expensive, but tremendously important. that includes putting off, picking up technology that would assist us in detecting cyber attacks. we reduced or eliminated operational training and travel across the board. that is in an effort to make certain that we do everything can to ensure that we

minimize any impact of furloughs, understanding that we're looking at not just fiscal year 2013 but 2014 as well. >> knowing of your integrity, you are a man of honesty and integrity, the american people should understand, sequestration will hurt. >> is going to hurt tremendously. the first thing you learn in the military and marine corps is that you take care of your troops. you take care of your troops. i think that is first. there is a real feel that troops are not being taken care of. these agents and personnel were in iraq for a substantial period of time, for afghanistan -- in afghanistan for a period of time. we have been asked to go to benghazi, libya, the attack on the embassy in tunisia, the algerian attacks, just to mention a few of the terrorist attacks across the ocean that we have had, 10, 15, 20

terrorist arrests over the last 18 months, two years. the impact of sequestration affects our ability to do the type of surveillance, whether it be technical surveillance or personal surveillance, develop the tools and i.t. capacity that we have been developing for the past decade -- yes, it hurts. >> i was with your people in afghanistan and iraq. we know how difficult it is in benghazi. then congress makes the decision to freeze federal pay women in afghanistan, who are in iraq, who went to their pay is being frozen for the third consecutive year. talk about taking care of your personnel. did you see the movie "zero dark thirty"? >> no. >> the team that track down osama bin laden, their pay has

been frozen. there is a scene in the movie where seven cia employees are killed. i went to a memorial service for them at the agency. those to replace them, their pay has been frozen for three years. that is a mistake. if the senate bill is enacted in its current form, your total funding levels will be more than a -- one other thing -- we ready to reprogram. if there is something that comes up we can reprogram, we will reprogram it to give the to move around to make sure you're taking care of personnel.

if the senate bill is enacted, or total funding bills will be more than half a billion below the freeze. at a level, what do you cut? do you have the flexibility currently to move around based on that? >> generally, we do. i would have to get back to you on specifics. the latest reprogramming that was selected by the department was in order to enhance the flexibility of the department to address concerns elsewhere. my expectation is we will have the support of the department as a result of working closely in order to assuage some of the current concerns. i want to thank the committee for having mark to that. -- marked that. i know discussions are ongoing. awould encourage congress as whole to consider the recommendations of the house. >> computer intrusions pose on urgent threat to our national security. it is the top -- one top priority of the bureau. i saw you, director brennan, and clapper testify together last week before the senate intelligence committee. the message was basically that

cyber has now taken over or would soon take over the with regard to terrorism. what is the number one country that is a threat to united states government with regard to cyber? >> there are several countries that have been mentioned for a variety of reasons. china, russia, and iran are all ones that have been mentioned in this context. they have different capabilities. different efforts. it is very difficult in open session to describe the different areas in which we find ourselves engaged with these three countries. >> one positive change, i saw our national security adviser to the speech last week where he and knowledge the primary source of the cyber threat being china. >> thank you. for your extended service and capacity. i want to continue to recognize us -- that and your service to the country. i think nigeria has also been an issue with regard to some of the

cyber security issues also. i first want to talk to you about the center for missing and exploited children. your team there has been doing an extraordinary job, working collaboration with other agencies to help track down and rescue young people who are victims of exploitation and kidnapping. the center would not be able to

function without the close coordination and your people there, they need to be commended. the center in the chairman's district is doing a tremendous job. thousands of young people go missing in our country each week. the work that is being done there -- i went out and visited the screen center -- screening center. this collaboration you have engendered with other law enforcement and intelligence agencies and this transformation of the work of the fbi since 9/11, really, to focus, as you say, with a threat-driven process on terrorism, you have done a tremendous amount of work. there was a recent capture of a gentleman who is now in new and is on trial that is

going to proceed there. it continues to point up the fact that there are continuing threats. we have to be vigilant. the sequester, what you say would be effectively about 2200 person hours -- or furloughs? >> because we have a hiring freeze, we have done our utmost over the years when congress has allocated slots to fill those slots. coming up next year with 1000 unfilled slots -- because of a hiring freeze, we will have 2200 vacancies by the end of the year. what this means is that we will be set back almost two years as a result. there is going to be a gap, which i met and saw a number of years ago when there was a

hiring freeze, or you do not have the leadership, along to develop along with the agency. fillunable to hire and those positions. >> mr. chairman, i hope if will get a chance to look at any possibilities on reprogramming, that this is an area where we can work with the department as we go forward. again, thank you or your service. i know other members -- other members want to get in. >> there is a vote:none. we will leave with five minutes left. -- going on. we will leave with five minutes left. >> you mentioned in your testimony, in written testimony, that you've got more than 1000 specially trained agents working in the cyber division right now. our chairman has been one of the real leaders in congress trying to draw attention to this, and others have as well. yet sometimes i worry, kind of like the children's story that the sky is falling, and we tend to not take those warnings seriously, when did this guy may fall, specifically with regard to the cyber threat.

could you give us a more in depth analysis of in terms of whether the fbi has, sequestration or not -- to you have what you need right now to address this constantly evolving world of cyber threats from a personnel standpoint? >> one thing you said, 1000 agents, probably less than that. we have more than 1000 personnel around the united states and specialists in the cyber rig. that includes agents, computer scientists, we just hired 100, as well as other personnel who are adept in this area. i can tell you since we changed our recruiting and hiring in wake of 9/11, hiring persons

with cyber skills has been one of our priorities. consequently, we have built up that capability. ago,said, a couple years we understood we needed your computer scientists -- fewer computer scientists. another 60-70, we will be unable to fill that. i think i pointed out, some of the technological tools that would enable us to do a better exploitation and investigation on the internet, we will have to defer. by the same token, we're doing much better in terms of our cooperation and collaboration with nsa, dhs, and the private sector. there is much more to be done. sequestration will hamper that. again, under budget

constraints, one has to prioritize. >> a quick follow-up, can you give us any recent examples of where your agent or personnel in the cyber division have taken down or possibly thwarted a cyber attack that may or may not have been reported in the public domain? >> i can tell you that there have been news reports recently, a number of denial of service attacks on banks. we have been working closely with the banks on those attacks. we had a case a couple of years ago which we were able to put a stop to, and enterprise utilizing networked to undertake a tax -- networks to undertake a tax. -- attacks. we have done a number of things in conjunction with the secret service, nsa, because many cyber attacks originate from overseas. those have been successful. the one point i would make is

that we tend to think and discuss in the beltway about protecting our networks from attacks, forgetting that behind every keyboard is an individual. aserrents is more -- is important as everything else. yes, you have to protect your databases, but those persons that are trying to get in have to go to jail. people have to understand that there is a price to be paid for breaking the law when it comes to cyber intrusions. that is something we are focused on, identifying the persons behind those keyboards, and making certain that if they undertake a tax, they will not undertake another in the future. >> i will yield back. >> would it make sense to double or increase the penalty for people involved in a cyber

attacks? >> i think we ought to look at the penalty structure, yes. >> could you get back to us? with regard to that, do you want to take a shot? we will take a few more minutes. we have five minutes left. do you wanna go? to a half minutes. -- two and a half minutes. >> good to see you again, sir. [no audio] >> microphone, please prepare please. >> now that you have some with the sequester, have you had to degrade background checks?

if so, do have any data on what sort of impact this is having on gun purchases? you anticipate further weakening of the system as continues? >> let me discuss what has happened since the sandy hook elementary school shooting in december 2012. the volume has increased by 50% since then. the average on volume of checks in 2012 was 54,000 a day. the average since sandy hook is 81,000 a day, a 50% increase in checks. generally, we have a close to 300 individuals who are conducting examinations or examiners to conduct those checks. we have had to add another 200 in the last 3 1/2 months since the attack in sandy hook.

we have taken persons from other areas. we have mandated overtime in order to accomplish this. we're still hitting a figure of 97% completed within the three day period. we're struggling to keep up with the increase. quite obviously, a budget concerns or constraints make it that much more difficult. we're trying to maintain that 97% completion rate within three days, but we have had to take persons of other priorities to do it. will continue to have to do it until we get some relief. >> we're down to 5 minutes. we will recess for about 20 minutes.

>> the hearing will resume. we will go to dr. harris. >> thank you very much, mr. chairman. beingyou, director, for here today. i have a very brief question. that has to do, following up on what mr. serrano asked on background checks. i want to commend the department for doing the job they're doing and keeping up-to- date.

very different from the state of maryland, where our 7 day waiting period is now a six week waiting period. i do not think it took the steps that you did to say, this is a priority. as you know, the law says, that if the background checks are not done in seven days, the gun can be released. with these delays, the threat exists that people be getting weapons that they are not eligible to receive. i want to clarify this -- this is not the responsibility of the fbi. the fbi turns over those denials, which are about 75,000 a year, you turn those over to the atf? >> that is correct. >> in an instance where it is denied, the dealer has it in his hands when the call to do the check. if it is denied, where does the paperwork and up? which should be the evidence of the crime of applying for

permission to possess a gun or buy a gun. >> there are record retention regulations, laws with regard to how long we can retain records. i would have to get back to you. hardecifically, does that copy that the dealer is holding, does that get transmitted to fbi or atf? >> i know it does not go to was. we make a referral to atf whether or not is a denial. i'm not certain how we do it. the paper -- it is probably done automatically. youll have to get back to on that, the procedures, what happens to the hard copy sitting in the hands of the seller. >> again, at a different hearing, we heard from the justice department -- obviously, decisions are made -- in 2010,

out of the 76,000 miles, only 13 were convicted. at one point, -- at what point -- the ig said it is a matter of not having evidence -- it seems to me that the paperwork would be the evidence. if you could get back to me, i appreciate that. i would like to thank you for responding -- for how you are responding to the increased demand for these background checks. i want to commend you for doing that in times of economic stress in the department. >> the only thing i would add is the legislation is passed to increase the number of background checks we have to do as a result of legislation, we spend about $100 million a year on this background check. we would probably have to double that depending on what legislation comes out of the congress.

>> mr. chairman, if i might add a question to that, my understanding is that there is great variation, part of the background check is a check on mental health records, and that there is great variability between states in that. i know that is true because i'm from one of the states that hardly ever reports on mental health problem. the chairman is from one that reports tens and tens of thousands of them. is that a problem that you would help resolve, or does that come out of a different -- the idea that we should encourage states to get up to speed on reporting everything -- the denial is only as good as a database that exists. >> we do not have the leverage to tell states to put money in to fund the notification and insert information into databases. >> is that a flaw, the flaw in the check, that they may not be as robust as one might think it is? >> to the extent we might not have data, yes.

there is an opening. i'm not certain i would college of law. it is a substantial gap. >> thank you very much mr. chairman. -- call it a flaw. it is a substantial gap. >> thank you very much, mr. chairman. >> i appreciate your forthrightness. the question i have is on the crimes act and data collection and the need for additional categories. i understand that the advisory policy board will be meeting later on this year to discuss and make recommendations on several different categories. the categories i was looking at, hate and violence, sometimes that is recorded differently, but both are important. those categories are the anti- sikh, anti-hindu hate crimes. what would you be able to say on the record? would you support adding those to the records?

attorney general holder has joined in the support of that. i wonder you would be able to go on record for that. in addition to that, if that was the case that we could add to that, is that requirement implemented without a bill that it could be required as a matter of administrative fiat? would you be able to implement information on those categories? i wonder what the cost might be associated with that if you were able to do that as an administrative action. >> congressman, i know the

administrative advisory board is looking at those categories. as you point out, they are poised to vote on it. we would be supportive of the vote of the category. i cannot get into the specifics. i am not as knowledgeable in the specifics. i generally understand the process and the goal of the board in reviewing this. in terms of the cost of implementation, how specifically it gets implemented, will have to get back to you. >> the advisory board is a step. neededre any steps before it can be executed or implemented? >> i will tell you, you cut and in like 18,000 separate law enforcement agencies in the united states. i'm not knowledgeable of how

those categories are handled by independent law enforcement entities, what it takes to have those categories added and the information and put in each of these law enforcement jurisdictions. i would have to get back to you. >> i appreciate that. i think the communities -- the communities also would. in terms of training, we have had this discussion about fbi staff training. utilizinge train was stereotypic erroneous information. we brought that to you, and you're telling us, you're looking at, making sure that these things would be eliminated and addressed. since then, i have heard a couple more times that certain

regions have been doing that again. i would like an update on that training. to my understanding those changes have been adopted. it meets all of the appropriate standards. if you heard that is not accurate, i would appreciate knowing its. believe other entities have emulated what we are going to do. >> it may have been that they hire contractors to do the training. would be a very serious steps. preview ofded contractors to be using our materials on behalf of the fbi.

to insure that all lived up to our standards. >> i appreciate that. >> i'm going to go back to mr. serrano because he was cut off. >> i do not know if anyone has asked, do you still have a program where you take new agents to the holocaust museum? >> yes. my predecessor initiated the training to have the new agent exposed to the holocaust museum so they know and understand what happened in a renegade law enforcement entity. and understand that the heart the bureau is the integrity, adherence to the law and

understanding that [indiscernible] power to affect persons and that power has to be handled carefully. to the extent it is not handled carefully, then you end up with not unlike what happened prior to world war ii. >> i commend you for continuing the program. you're kind enough to give your predecessor credit but you could stop it and you did not. you continued the program. we have great respect of which support the work of the fbi but as we have discussed, there is been times when the bureau did

not do what it was supposed to do and many people were hurt. in my birthplace in puerto rico, there were some things done to some folks up was not proper things to do. when you continue this program, you do make a great statement on behalf of what is the proper behavior for the bureau and i thank you for that. >> i'm concerned about lack of public awareness about the threat of foreign espionage, especially among federal facilities handling export control but not necessarily classified technology. foreign espionage is a major concern here. last week the times reported, the cold war may be over but spying did not end with it. far from it, says a spokesman

for the fbi field office. secret generated by huntsville. they went on to say it is a major target. fbi spokesman paul damon said do you believe specific centers targets? what are the targets? >> they are targets and recognize that as a significant threat. we have a program called agent

in the lab where we host agents to 17 of the research facilities and laboratories around the united states. they are embedded in research facilities to better understand and address that threat. we also have a national security higher education advisory board. we try to educate the leaders of these universities as to the threats that can occur at our target their research facilities. i would say probably has gotten exacerbated in the realm of digital information and cyber attacks. you no longer have to rely on an individual becoming your asset to gather the secrets in the cyber arena. it is just as easy to have somebody familiar with a cyberworld sitting in shanghai are beijing or some place in russia to attack the networks and export the information. a threat is more substantial than it was 10 or 15 years ago.

>> i wrote to you about security lapses at the nasa centers. i saw that the fbi and dhs were involved in the apprehension of a credible individual being held. you have any comments about that case? >> i think it is indicative of the threat you mentioned. the arrest occurred over the weekend and is now in the court proceeding. >> if it was happening at nasa langley and i saw your

testimony last week's with regard to clapper with regard to china, could it be happening at ames or at goddard or other places? has anyone taken a systematic look at it? >> we do have -- we have a number of investigations ongoing but in terms of a systematic review and being undertaken, i would have to get back to you. i am not aware myself of a systematic review. >> if you would get back -- the individual at langley was paid for by taxpayer money. if it could be happening at langley -- if you could look at that and get back, i would appreciate it. two questions on gangs.

a recent bulletin produced by the national gang intelligence center noted there have been growing numbers of violence in ne usa as well as in the midwest. do you believe the national gang intelligence center serves an important role? >> i do. >> do you believe these gangs have any connections to terrorist groups like al qaeda affiliate's and is there concern they might be sending members to join? >> a number of individuals

>> a number of individuals from the community and elsewhere in the country went to somalia to join al-shabaab. one or more of those individuals may have had some association with gangs in the course of their -- in the course of living in the communities, but i do not think we have found that related to the radicalization. it was more happenstance as opposed to the gang being a fertile field for recruiting for al-shabaab. knowst of the sudanese i of come here to escape the bashir administration. who are they? >> i am much more familiar with the somali community than the sudanese community. that is the first i've heard about sudanese gang members perhaps being recruited for work overseas.

>> can someone look at it and let us know? we have heard a number worsening gang trends. unification of prison street gangs, alliances with drug- trafficking cartels, rapid cell phone use in prison, increasing use of a female facilitators. does that all ring true? >> yes and it has for a number of years. >> is it growing or decreasing? >> i think it has grown over the last few years. i spent time in california, a

number of gang members ended up with the pelican bay in northern california and ran their gangs from inside the walls. it is a phenomenon we have seen around the united states for a substantial time, and it probably has grown most recently. >> thank you, mr. chairman. director mueller, welcome. thank you for coming before the subcommittee today and i thank you for your service to the country and for your professionalism in running the fbi. as you know, the fbi operates the national and state criminal and background check system. we have to enforece the laws that we have. the the momentary glance at laws we have proves there are holes in our system that even with adequate enforcement would not keep guns out of the hands that seek to do us harm.

thatocused on the fact those on the terror watch list do not raise a flag in the system. i do not understand that. what are those on the terror watch list and not automatically denied a fire arm from licensed firearms dealer and should it person's listing on the list be a factor in the denial of a firearm? >> the reason those on the are nott watch list barred from firearms is statutory. it is notone of the factors is listed in the statute. there is legislation being discussed in terms of what more can be done to expand these

prohibitive factors or to expand it and other ways the use of nix to bar the sale of guns. >> so a person can be on the terror watch list and yet we have to pass legislation to ensure that a person on that list can't purchase a gun. >> that is my understanding. indicatedsident has he plans to devote additional resources in this fiscal year morelp states provide information to the federal databases used in nix background checks. how long do you think it will take? how much funding to make the databases complete enough to have confidence that prohibited individuals are not able to purchase guns from licensed dealers? have you seen a greater effort by states since sandy hook?

>> i would have to check whether we have seen an uptick in terms of the information from states. generally we do after something like sandy hook. it differs from state to state. i would have to get back to you on that. the'm concerned that sequester could impact the ability of the fbi. if the three-day clock ticks down, those who should be restricted from having access to

firearms could be able to make the purchase. what happens when a prohibited purchaser is able to complete a fire arms purchase because it takes longer than three days to resolve the eligibility question? is the fire arm retrieved from that individual? how long does that take? what do you do about that? >> we have had a substantial increase in requests for checks since sandy hook. we have been able to assure 97% of the requests were resolved within three days. thet's resolved against person having a weapon, then it is referred to atf and it had to retrieve that weapon.

>> i would like to continue this discussion with you at another time but i have one other issue. i came up at another hearing attended. oft week the department justice inspector general testified before the subcommittee, spoke on the importance of encouraging private businesses to invest in their own network security and to report incidents of cyber intrusions to the fbi. are you working closely with the private sector? are they good partners with regard to sharing information that could help the fbi learne more about cyber? cyber threats and vulnerabilities. bring us up to date to the challenges.

>> in the wake of 9/11, we had to establish joint terrorism task forces throughout the country. when it comes to the cyber arena, the key partner is the private sector. headway with the private sector, but there are hurdles to working together that we have to overcome. one is liability. for sharing information. some would argue there are issues with regard to the antitrust laws get together and -- regard to the antitrust laws if the private sector gets together and then shares information with us. there are issues relating to the loss of the proprietary information, if they share it with the federal government. we are working through those but if we are to be successful in this realm, we have to develop

mechanisms of channeling information between the private sector and federal enclave to participate and prevent cyber attacks and identify those responsible for those attacks and to make certain they are deterred from additional attacks. >> thank you. it seems it is a question what can be done now and if this legislation -- are you really preventing from a good relationship with the private sector? thank you bear much. >> [inaudible] >> i have heard this is a growing concern about gangs in the u.s. military. does the dod participate in the national gang intelligence center?

to your did access as a tool to flag or detect potential gang recruitment in the military? >> i would have to check to the extent the personnel assigned. i do know that we work cooperatively with the military to address gangs that may be on the feet and also in the military. particularly in cases where there is indication the gang activity is not relegated just to the community. we have enhanced our cooperation in that regard. would it make sense for dod to dissipate with one person over there? >> i would have to get back steve. what we have to assure there is the exchange of information and intelligence.

>> thank you, mr. chairman. director mueller, thank you for the superb job you have been doing at the fbi. we spoke about using dna technology to solve serious crimes. there was a period when the crime lab had a backlog of offender dna samples. it was a lot of work but by investing technology, the fbi has cleared that backlog. the report from 2010 down there was a substantial f.b.i. dna casework back log. an update published in september found that that backlog is a very low and well managed. i want to commend you and your staff for bringing that up to date.

i have no doubt that we are solving serious crimes and preventing additional people from being victimized. there are many state and local crime labs around the country that have not been as successful as the fbi and i hope that you and the fbi lab can prioritze sharing the lessons learned about clearing your backlog with the state and local governments. i wanted to touch on a familiar search which we talked about before. this is a method to determine if dna from a crime scene has a relationship to someone in the offender database. perhaps the best case was of the grimm sleeper who murdered women over the course of decades. he was caught because a familial search linked evidence from crime scenes to his son who had been incarcerated in california for robbery. i introduced legislation last

year and intend to do so again, asking the fbi to impliment securities on a national database. right now, it is on a state-by- state basis. we were lucky in the grimm sleeper case. if the killers son had been arrested in nevada, we would not have gotten a hit and there may have been subsequent victims. we had a good hearing in the judiciary committee last year. i hope we can get the bill to the floor of this progress. he voiced support for the technology. staff wasour exploring how to implement such a system technically, including building software you use to implement -- to estimate the likelihood of a familial relationship. do you have an update on the progress towards the findings of the working group that have been studying it? believetill congressional authorization is necessary or preferable to start allowing searches of ndis?

>> there is a prosecutor and law enforcement entity that would not be supportive of a mechanism such as this to identify a person responsible for such horrendous crimes. the three things i should mention -- your legislation will continue to support. i do believe that would take some statutory assistance to push it through. it is a somewhat controversial development for new technology. aboutwho were concerned privacy rights and the like have substantial concerns. the scientific working group on dna analysis has been meeting and has recommendations. we expect those to come out this summer, perhaps in july.

we are looking at designing an algorithm we can use of the federal level to conduct such searches and do it appropriately. according to standards set up either by regulation or by statute, but yes, we are supportive of this. we will try to keep you apprised of each of the steps. >> do you have a sense of when that technological work will be developed? we have done it in california, a number of other states have it. it is not that difficult by any sense of a time line? >> i will have to get back to you on that. no, i do not. you, it looks like it is coming to a head this summer with recommendations from the board. >> my hope is we can take some action later this year.

on the subject of dna, i understand the fbi has been utilizing this. that the dna is the technology that puts a crime lab in the hands of the officer at the scene. rather than waiting days or months or weeks to develop a profile of an arrestee, a police officer with a simple training can take a dna sample themselves and have a profile with and 90 minutes. rapid dna was discussed at length by the supreme court in the case of maryland versus king, concerning the constitutionality of collecting dna profiles on the arrest. the timeces noted that when dna will serve even more directly as a method of identifying an arrestee is rapidly approaching. this is a technology many are not aware of yet. i know that they had been participating in testing.

i believe this can be a powerful tool. feel that the dna is the 21st century fingerprint, but i also understand that the dna identification act would include -- preclude of loading a dna sample obtained using a rapidly in a device into the national dna system. do you expect the department to ask for an amendment to that law? to accommodate this new technology. >> i am uncertain about the impact of that legislation and what the justice department is doing. testingoint out, we are two prototypes. this summer, the expectation that rapid dna will eventually be at booking stations when you go in the same way you take fingerprints. i would have to get back to you

the question of the legislation, the impact on legislation. >> as i understand it, you need an independent verification by an outside lab and that cannot be done in the 90 minutes in which to do a rapid dna test. i would think when the technology is ripe, we will work together on that. >> i understand the catch-22. >> in your testimony you discussed the theft of intellectual property and trade secrets. occursmore public debt -- theft occurs every day from rampant piracy. this sub committee is prosecuting these cases and i hope you will continue to make ip and piracy a.

they have a real cost in the form of u.s. jobs and economic activity. we have a good reminder two weeks ago released in a study. they looked at the period following the seizure of mega uplaod. researchers studied movie trends before and after the indictment and arrest. at one time, it was the 13th most popular site on the internet, went off line. they found that sales of movies through legitimate sources increased by 6% to 12% following the closure. even though shutting down mega upload did not stop all piracy, it was successful in making piracy less reliable, less convenient than before, and

some are willing to switch to illegal channels as a result. i want to commend you for the success. i would ask this work. they have a real pay off so i want to urge you to continue to make this a priority. >> we will. me suggest something to you --we have in the cyber arena a private entity. that is reluctant to cooperate on occasion. we have asked them to cooperate with the federal government. on the one hand we are asking, when it comes to intrusion but private industry, support us.

there has been some reluctance over time. on the other hand, when it comes to intellectual property, they provide us -- to information and ask us to pursue these criminals. my question is -- why are they not together? intellectual property can be a movie, a song, a military secret. something stolen from a university. as isarch laboratory, being pointed out. it would seem to me that private industry would have, if you combine them, to work with us to address cyber attacks. we have talked about intellectual property cases and on the other hand cyber cases, and i suggest that they are not

too different. and that we ought to be looking at them as one grouping and should have the support of private entity in those efforts. >> i agree. we are getting our house stolen in front of us. some of it in very open forum that you can see on the internet. some through accidental cyber attacks. we ought to be cooperating between the public and private sector in both those marinas. they are both equally devastating. i think we're close. the private-sector has some concerns about their liability but at the same time, the private sector does provide inspiration to the government so why not provide the same corporation? i think we're pretty close.

intel committee, as you know. there are some remaining issues about whose responsibility is to remove certain information. i do not think that is an onerous burden. most large players are doing this already. they are sophisticated. they have the ability to do it. but we need to look at this in a holistic way and attack the problem. both the public and private face of it. it is not always the same industries. note is overlap but it is always the same players or the victims.

>> i think i am going to stay. i am going to miss the vote. show if there is a book that i would have voted aye. i did not want to hang around. the fyi 13 bill includes funding to procure a comprehensive external review of the accommodation of the recommendation lead to the fbi that proposed in the report issued by the 9/11 commission. the review also includes an analysis of the fbi response, including the influence of domestic radicalization. the language requires admission no later than one year after the enactment. onould like your comments

it. i think it is a positive thing. it was a good amendment. the fbi toourage draw up the experience of 9/11 commissioners and staff. i did not put in a language specifically, but i would hope that when this passes, i think it will. i do not think we need another 911 commission but we had a plan which to draw upon experience of and i think those individuals will be good. do you have any comments about it? >> i would have to take a look at it. those two individuals have shepherded all of the elements of a response of september 11. they certainly have the experience, but i would have to take a look and see what is meant, what kind of review, how extensive, where the staff comes from, and the like. >> it's not meant to be any

criticism. this actually includes $500,000 for an external review of the recommendation related to the fbi. the fbi is encouraged to carry on this review. to draw upon the experience of the 9/11 commissioners and staff. i think both of them did a pretty exceptional broad job and with very good people. i want to commend you for your policy which has been in place since 2009. it prohibits non investigated cooperation with the council on american islamic relations, care. was a identified as an unindicted co-conspirator in the holy land foundation case. last year i asked the inspector general to investigate a number of instances with for sealed and will not comply with this policy. i'm told the report will be released this spring. could you confirm for the

record policy prohibiting on investigative corp.? that it remains in place? >> it does. >> we have discussed before my concern with fbi cooperation with american non-islamic care. >> i saw an article today in the new york times. appropriation act again and identify support for that policy. we have not received any notification, so we just assumed that the no violation of the policy, but your field offices do know that that is the policy? >> yes. >> i just saw an article today in the "new york times." i was inebels -- lebanon and egypt, interviewing people going across the syrian border. they were concerned of some of

the radical elements in the free syrian opposition. my sense is the administration has failed. they should been involved very early. had they done so, we may have pretended what may have been -- they all were fearful of what could take place. in the new york times, to be first prime minister of a syrian government. charged with funneling aid to rebels and said syria. offering an alternative to al asad. bad person. a we want to see him go. by choosing an information

technology executive who lives in texas -- it goes on, but it said he is of kurdish decent and with the council, may have seen a plus. syria'ss a choice of group brotherhoo,d, agroup that had been banned. he advocatedo say, for americans on islamic relations. that was slightly concerning particularly since i have had all of these different families of all different denominations of faith all tell me they concern -- they are concerned about what ticks place currently in syria.

>> new headquarters. the need for new fbi headquarters has been in the news lately. hasderstand that the gsa received 35 proposals from developers and communities in the metro area. can you bring us up-to-date with the circumstances and then the status of the effort including an estimated timeframe for decisions and the timing of an actual move. >> the reason for the new headquarters is because -- our headquarters on pennsylvania avenue. it isn't -- the most architecturally pleasing building. honest with you. but we have outgrown it and we have something like 20 entities

around. that has driven us to seek a new headquarters. it needed to be in the capital region, near transportation and to assure that meets our security concerns. gsa pointed out there are 35 applicants or proposals have been submitted. i'm not sure the timetable. i will have to get back to you on that. >> i have been concerned with the senate language targeted to go to a certain location. people ought to be open, and nothing but

integrity. there is probably no one i trust more in the government than you. they have been pending for some time due to a lack of funding, specifically the central records complex. hopefully, as you talked to gsa you will make sure you will be oen, honest, and in an appropriate way. i'm familiar with additional construction projects that would be funded from your own appropriations. they have been pending for some time due to a lack of funding or authority. can you describe the need for for these projects? and can you give us an estimate

from the associated funding requirements and the status? >> to the extent that we need funds, we will have to look at moneys from quantico for other funding. that has been something we have wanted to accomplish for a number of years, to modernize in one place. records are so important to the work we do. i'll have to get back to you on where we are specifically with these other things that are going to be affected. >> could the other two be part of the package? my understanding is that whoever is successful on the bid, they will have an opportunity to procure.

i was wondering if you can do all three together. >> i will have to take a look at that. i see your point. >> i think it's about the lack of progress in benghazi and apprehending and bringing to justice those responsible for the attack. month now beyond the six date. people experienced problems getting access to the state initially. you went to libya in january. were you satisfied with the and result of the

investigation? >> there were hurdles at the outset. benghazi did not have a good law-enforcement. they could not provide security and the ability to act as our partners were to assist in developing witnesses. we have overcome many of those hurdles with the help of libyan authorities who have exhibited a willingness to support us in our investigation. i met with the prime minister and i assured his support. i met with him when he was here again last week. the question is not necessarily the willingness but the capability. we are working on that.

the investigation is progressing. we have interviewed a number of witnesses. >> i was in egypt two weeks ago, i gave him a letter asking president morsi to allow the fbi to interview the person they have in custody. has the fbi been given access to the individual? >> no, not yet. >> let me commend your people for going out there. your people were in tunisia waiting for five weeks. >> they were and tripoli for a long time.

in tunisia. i hope i would have the support of the committee when we mark up. i think it is unacceptable. we lost four individuals who gave their life serving our country. the very thought that our problem will give the foreign aid to the morsi government and not having the fbi having access to that individual is unacceptable. anne patterson told issue would

raise it to thomas secretary kerry was going to raise it. >> on friday, a federal judge in california to declare the letters unconstitutional. do you have any comment on the fbi's use of national security letters and your use of them as a tool. >> they are a critical tool establishing a predicate -- they are essential tools in terms of establishing a predicate. without them, we would be working with one hand tied behind our backs. it has been addressed elsewhere.

i know she has stayed the ruling so that an appeal can be taken. second circuit address the same the actionsund that to the way we're operating under that particular statute it via the constitutional -- in-line my expectation is it is addressed. either on appeal or by new legislation. it is an essential tool. >> how essential -- what would be the circumstances if the ruling were upheld? >> it would dry up a number of our

counter terrorist investigations. it would drive up our ability to get at intermission and severely undertake those counterterrorism investigations. also in the cyber arena, if we impact our ability in the arena as well. >> the alleged al qaeda spokesman who i think was osama bin laden's son in law was arraigned for conspiracy to kill u.s.

specialists. why is this an appropriate approach? difficult to get into in an open station. i can sit there was some intelligent that he might be traveling. best vehicle for having a country detain a person is falling and interpol notice then is the basis of the that person's.

in this party to the individual was detained in the protocol. i did not leave we would have -- i do not believe we would have had the ability to tame this person without utilizing the process. >>there is something inconsistent. every time there's been a question asked, they usually say this is an open domestication and we cannot comment. thethought that investigation killed alawki a drone, is being using the fbi.

you can't go in downtown benghzai and knock on a door get a warrent. it just seems like there's two different approaches being taken. in one, the drone was used on al alawki. >> if you want to comment, i would love to have you comment. >> i am not certain one should say we are utilizing one approach to the exclusion of the illiterate everyone of these situations are a bit different. there are occasions when it goes one route and others go --

an investigation is initiated then determine the options after worth. the expectation is we want to gain of the intelligence we can to prevent the next terrorist. then you have to have an end game on the individual you have attained. there are a variety of options there. i would say each of those options are on the table whenever we address a situation like this and we choose the best that will maximize our to get intelligence and make sure the person we have detained faces some charges. totwo more then i will go mr. fattah. last year we discussed domestic

radicalization. what are the latest trends and what successes and charges are what you having countering this threat? >> i think we have been successful stopping the larger attacks. i never say it's not going to happen but what we have seen is persons radicalized on the internet, generally the lone wolves, and engage in some form of activity. covere had some under cases where persons have been investigated, gone to trial and

successfully prosecuted in this arena. these are the lone wolves. we have been successful using the same tactics for white- collar criminal cases in terms of surveillance, using and identifying the person then ha to thwart any potential for an attack. there are reaching out to anybody else which would in a lot to identify or alerts them. it is an increasing trend.

we have been relatively successful. my hope is that our traditional techniques will continue to give us some success in this arena. >> shifting just a little bit from that, does the recent legalization of marijuana in colorado and washington state and the trend we are seeing -- how will that impact the fbi and indirectly the dea? you are involved in these cases too. >> i have not given thought. we have done very little. we have task forces and the like. i am really not certain what, if any, impact it will have of the work that we do. >> the last question i have is you have had a long struggle to development and implementation predicted develop and implement

-- to develop and implement the sentinel. what, if any challenges remain? i watched the sun to last july. it has been successful. showd a study that will that in order to do our investigative report we cut off time in half that the bid to to do at investigative reports. we're still integrating our databases. you do not have to cut and paste information from one to the other. was, i believe, very well respected by -- very well received by those in the field. the continued every three or four months. we have an upgrade that provides new versatility to the people in the field. finally thatt program was successful.

>> when mr. fattah? >> per se the bulk -- >> i just have one thing. sentinel and developing sentinel further and giving the agents a tools as part of the i.t. -- it is a tremendously important we maintain. the budget constraints, where we have to rein in what we're doing can adversely affect our ability to continue development of the sentinel. >> let me start here. you have had a distinguished career. i want to ask a couple of questions. i do want to mention that i note

in your bio you served in the marines. i want to take an occasion to offer prayers to the families of marines who died today in the explosion at the explosive test center in nevada. .even others were injured i know the chairman shares that. since this is our last public engagement i want to say that on the record. let me move to this point. -- e articles have had it wouldn't be the gentleman who has been put to new york most recently. ofs has been over a number presidential administrations. these courts have been able to properly adjudicate these matters. to do that within the constraints of our judicial system -- that does not take

away from any of the procedures it might be available? as you explained, when we are operating in terms of international law and the way that this particular individual came into being able to be detained was interpol. thent to commend administration for its aggressiveness and getting this person and making sure that we can hold. elsethhold him and anyone accountable for the attacks for 9/11. the congress has a number of issues that from time to time has come into place. i think all of us should agree that the work that you have done and that the fbi has done since 9/11, protecting the country against any massive domestic

terror attack and all of your activities internationally -- it has been remarkable. focus as wasrimary 9/11. bring you back home for my final question. it is about the budget and appropriations for the department of justice. we in prison more people than any other nation in the world. this is through our state and federal prisons. under our is committee jurisdiction. to be 24% of the doj budget. about 29%. i think it is clinton continued to rise. at some point we have to think

differently about what we are doing with people. i have constituents have family and children. we all want to be protected from dangerous people. at some point, as a country, -- you have been running the fbi, you have had a few of this from a lot of different perspective. the committee is going to be wrestling with these issues over the next decade. the more people we lock up the more we put into prison, the greater share this budget is going to be taking up. -- ie same time these tried to protect our country from terrorism. they're going to be shrinking relative to its portion of the budget.

the chairman has been the biggest supporter of the fbi that congress is ever seen. i have seen him in the private rooms when there are just four of us. the question because this, as a country as society deal have eighth thoughts about -- do you have any thoughts about making to we want to put in a prison cell and spend money to keep them locked up. we might have to think about a different approach in terms of seeking punishment for their transgressions. >> it is a morsel of " question but i would appreciate your comment. >> it is a cosmic question. i did speak for the fbi.

-- thea said the necessity for -- and i think you for the support you have given to the fbi. the fbi has changed over a period of time. ways of a number of resolving in particular case, one may be in president one day be deportation. another one to be house arrest. there are a number of particular dispositions. my concern is as we go through the next two or three years at the american public congress administration understand the fbi is unique and have to change with its practice. priorities. on we have a lot of jurisdictional capability that we have to prioritize. we need to make sure we for the community,

whether it be mortgage fraud or fraud on wall street or public corruption or civil rights abuse. we need to make certain we are focused on the greatest revenue -- on the greatest american public. that really is in hansard are supporters of the -- in the hands of the prosecutors at the department of justice. >> what we are going to do is we are going to introduce the bill after -- and i am going to ask to your comments -- after the recess. it will be the bipartisan two of us. to set up a national commission made up of mainly prison experts, particularly in the states, many of them very conservative states.

they have had to respond to the prison crowding more from an economic issue than any other. it will be bipartisan. ofare looking for a chairman stature who can come and take a year to report. i think our present system is dysfunctional and i sense there are very few people working the prisons. industry has been decimated because of congress. we tried to get prisons to adopt programs to allow them to make products that are no longer made in the united states. there are only two baseball cap manufacturers in the united states. roy what you think about having on thenal commission

conservative republic? democrat he can talk for himself. if you really look at this thing -- we would have to talk to mr. fattah. name would be chuck colson. he went to prison. he became a believer. he spent his christmases in prison, easter's in prison, right up until his death. prisoners really loved him because he cared. most people couldn't to prison and a runaway. what are your thoughts about putting together a bipartisan commission about looking at this to see what we really to particularly. in every program of what portion of the