May 11, 2006
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Remarks of Emil W. Henry, Jr, Assistant Secretary for Financial Institutions U.S. Department of the Treasury Before the Financial Services Information Sharing and Analysis Center
St. Pete's Beach, FL- Ladies and Gentlemen, I first want to thank you for this opportunity to address you and your organization. This is my first opportunity to address this group, having been in my current position as Assistant Secretary of the Treasury for Financial Institutions for less than a year.
Let me first say that, on behalf of the Department of the Treasury, I recognize the value of your efforts to gather and share with your members reliable and timely information from financial services firms, commercial security firms, and federal, state and local government and law enforcement agencies. Your efforts to prepare for a wide variety of potential challenges provide a critical service to this country.
One reason that I so strongly value your organization is that I myself come from among your ranks and have spent the bulk of my career working on Wall Street. I know the value of what your organization works every day to protect – America's financial services sector.
The individuals in this room – all of you – are serving the American people through your commitment to ensuring the resilience of the financial institutions you represent. Your efforts are vital to your customers, our fellow citizens, and our trading partners around the globe. Your collective efforts help to make our financial system the strongest and most reliable in the world. Your commitment, hard work, and creative solutions to challenging problems is what makes the American financial services sector resilient in the face of the challenges it encounters every day – challenges ranging from computer viruses to potential international terrorist attacks. America's financial system is the envy of the world, and that is due to the work of you and the many other thousands of men and women who work in our financial services sector.
I also want to take a moment to thank Suzanne Gorman, the chairman of this organization, and the board of directors for your leadership of the FS-ISAC. You've all done a tremendous job. I know that each of you has a day job with many responsibilities, and I want you to know that we recognize and appreciate the commitment of time and resources that you have made for the betterment of the FS-ISAC, and ultimately, the betterment of our Nation.
And let me remind everyone that your efforts and those of your members are paying off as the FS-ISAC has shown tremendous growth in the last four years. Your membership has increased from 62 financial institutions to almost 2,000 direct members. Indirectly, through agreements made with several important financial associations, the ISAC reaches over 11,000 members. This is an outstanding achievement.
As you know, your work is vital to our economic security because in many ways the financial sector is one of the core engines of our economy. And let me emphasize here that our economy is very strong. Our Nation's economy continues to grow under the leadership of President Bush. More than 5.2 million jobs for our fellow Americans have been created since August 2003. Our unemployment rate of 4.7 % is lower than the average of the 1960s, 1970s, 1980s, and 1990s. Our gross domestic product grew at a strong 4.8 percent annual rate in the first quarter of this year. This follows economic growth of 3.5 percent in 2005 – the fastest rate of any major industrialized nation. And the Conference Board Index of Consumer Confidence increased in April to its highest level in almost four years.
We can attribute the success of our economy to good economic policy, combined with strong responsible leadership and healthy public confidence, which is a vital part of any country's economic growth. By enacting the Jobs and Growth Tax Relief Reconciliation Act of 2003 three years ago, our President displayed strong leadership and wisdom and provided a catalyst for economic growth and vitality, which has benefited all Americans.
A major component of public confidence is that people believe in the American financial system. Americans trust this system and the financial services firms that comprise it because this sector has proven to be extremely safe and sound – the best financial system in the world. And that fact is a very positive reflection of you and the firms that you all represent in this room today.
FS-ISAC Achievements in Preparedness
I am pleased to tell you that we in the Administration believe that the financial services sector is in an advanced state of readiness and preparation, and that you have handled well the challenges the world has thrown at you in the post 9/11 environment. The FS-ISAC has been a key component along the way and we believe that it has served its members well. The examples that come to my mind are the August 2004 increase in the threat level for financial services firms in New York City, Northern New Jersey and Washington, as well as your efforts during Hurricanes Katrina, Wilma and Rita to ensure that your members were informed, and that recovery efforts could begin among financial institutions as rapidly as possible.
Throughout its relatively short history, the FS-ISAC has been there when it was needed the most. Shortly after former Homeland Security Secretary Ridge's August 2004 press conference increasing the threat level for financial services firms, the FS-ISAC leadership convened a conference call with over 250 representatives from your organizations and a few from mine. This type of quick action and information sharing is one of the best values the FS-ISAC adds to the sector. And again, thanks go to the FS-ISAC's board of directors and leadership for heeding the call to action and for service to your fellow Americans.
Treasury's View of the FS-ISAC
Let me also share with you that, within the Administration, the FS-ISAC has the attention of the most senior economic officials of our Nation and we consider your mission to be vital. In early 2003, we commissioned a study on the value and sustainability of the FS-ISAC. This study overwhelmingly showed that your members desired a service that would provide the kind of information sharing to which the FS-ISAC is dedicated. In addition, the study also produced a business plan to transform the FS-ISAC and extend its reach to serve the entire sector.
As a result of this study, the Treasury invested $2 million dollars to support and implement the business plan and we have all seen great progress. Our investment improves the operating capability of the FS-ISAC so that its members can immediately receive threat and vulnerability information, share vulnerabilities and information anonymously, communicate within a secure portal, access new data feeds of threat and vulnerability information, and access a wide range of user data from which users can produce their own reports and metrics. All of these consolidated metrics are accessible on the public portion of the FS-ISAC website (www.fsisac.com).
I visit the metrics dashboard periodically just to see the progress being made. And I have been very impressed with the most recent addition to the website: the current financial services sector threat advisory level for physical and cyber threats. I was very glad to see, based on expert technical advice, that two weeks ago the ISAC indicated that the financial services sector is feeling even more confident in the cyber area. At the Treasury, we have been working very hard to ensure that all parties are aware of both the threat of malicious software and of appropriate countermeasures to be taken to mitigate the effects of such malicious software.
Coupled with its support for your mission, the Treasury's greatest goal for the FS-ISAC is sustainability. The FS-ISAC needs to and will stand on its own. It has proven that it is a viable service and the private sector will support it.
Treasury's Role in Critical Infrastructure Protection
In addition to your commendable efforts, we at the Treasury like to think we've also had a role in financial sector resilience.
President Bush designated the Department of the Treasury as the lead agency to protect critical infrastructure within the financial services sector. In that role of lead agency, also known as the "sector specific agency," we continue to lead the federal government in policymaking that protects the financial infrastructure. We work closely with the Department of Homeland Security, local, and state officials and agencies to coordinate our efforts to protect the financial services sector. We also have completed Protective Response Planning Exercises with major financial institutions, identifying vulnerabilities and developing solutions to address them. In a similar vein, we have evaluated interdependencies between the financial services sector and the telecommunications, energy and information technology sectors.
I would especially like to single out the very strong working relationship we have forged with the Sector Coordinator – Donald Donahue – and the Financial Services Sector Coordinating Council (FSSCC). Don Donahue has superbly represented the financial services sector, and he and the FSSCC leadership have done a terrific job in providing policy leadership from the private sector regarding critical infrastructure protection issues.
At the Treasury, we have drafted a robust research and development agenda for the sector. The Treasury, working with the financial services sector, established a new model of regional coalitions such as ChicagoFirst, FloridaFIRST and a new regional coalition in the San Francisco/Oakland region. We also understand that more such coalitions are being developed around the country to serve the financial services sector.
As someone new to government, I am already seeing the importance of our efforts to break down barriers and increase the availability of accurate and timely information about potential threats on a national and regional level and what those efforts may mean for ensuring the resilience of the sector. As all of you know, information is critical in order to counter threats, whether man-made or naturally-occurring.
Conclusion
I cannot say enough about the talent and dedication of the men and women of the financial services sector. You all deserve the thanks of those of us who use your services, and that includes just about all of us.
However, there are many challenges that lie before us. June 1st marks the beginning of a new hurricane season. Federal, state, and local officials are working aggressively to prepare the Gulf Region in the event that another large storm strikes this season.
I also want to remind you that there is a continued threat of terrorism, and that attacking the US economy and the financial system are strategic goals of al-Qaeda and other terrorist organizations. Eight years passed between the first attacks on the World Trade Center in 1993 and the follow-on attacks of September 11, 2001. It is vital that we remain vigilant and continue to adapt our preparations to new and emerging threats.
The President's quote in the National Strategy for the Physical Protection of Critical Infrastructure is an appropriate way to close today. The President said "[t]he terrorist enemy that we face is highly determined, patient, and adaptive. In confronting this threat, protecting our critical infrastructures and key assets represents an enormous challenge. We must remain united in our resolve, tenacious in our approach, and harmonious in our actions to overcome this challenge and secure the foundations of our Nation and way of life."
Thank you again and I know that you will have many productive meetings.
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