The Department of Homeland Security

by Jack Barkstrom - Attorney, CPA

The Homeland Security Act of 2002 (HSA)

The Homeland Security Act of 2002, if it did nothing else, created the new cabinet level Department of Homeland Security. It was intended to organize a number of different agencies and functions into a single agency, which would solve the homeland defense problem once and for all. It looks a little different now, than in 2002. There was a belief that re-shuffling functions and placing them under single umbrella wouuld improve things, at least in the coordination area. The assumption was that the lack of cooperation between agencies had been the underlying cause of the 911 attacks, and having one Department in charge would solve the problem. Being appointed to lead one of the new departments was a prestigious appointment. In reality the functions and staffing needs did not really change, and the various angencies were so different that they needed to focus on their special training and staffing needs to really help with national security.

Where did the Secret Service go and who's in charge here anyway?

One of the most puzzling changes was to transfer the Secret Service from the Treasury Department to the Department of Homeland Security. Perhaps it was related to the fact that one of the duties the Secret Service performed was the protection of the president. Perhaps presidential security was more appropriately under the Department of Homeland Security, since it focused on security. Perhaps it was intended as a message that the Secret Service was too closely associated with the IRS, which was another agency within the Treasury Department.

The U.S. Secret Service (USSS) had been created to deal with counterfeiting, at the end of the Civil War. President Lincoln had signed its authorization, on the same afternoon as his attendance at Ford's Theatre that night, where he would be assassinated. In spite of the recent transfer to the Department of Homeland Security, the Secret Service did not lose its mandate to deal with counterfeiting. The U.S. Mint, another agency which combatted counterfeiting by minting coins and printing paper, within the Treasury Department, was not transferred to the Department of Homeland Security.

In one sense, the Secret Service still was responsible for dealing with counterfeit operations, since its broader assignment was to protect the integrity of the U.S. financial system. Since the counterfeit threat was not limited to domestic organizations or individuals, the Secret Service had expanded its operations into the international arena. As part of that expansion, it devoted some of its resources to the cyber security area. While less known, it has the reputation of being on the cutting edge of cyber security. Those skills and experience would be a valuable commodity in the intelligence community, which may partly explain why the Department of Homeland Security would be interested in the transfer.

The legal wrangling over which agency has responsibility for domestic surveillance and which has responsibility for foreign surveillance has not impacted the cooperation between agencies. In the area of cyber security, the FBI still works closely with the Secret Service. The Treasury Department, along with the FBI and Secret Service, work in cooperation with the Federal Reserve to improve security within the banking system.