 Thank you, David, and thank you to CSIS for hosting this event. It's a real honor for me to participate in this discussion, and it's also really gratifying to see TFI, I'm very emotionally tied to TFI, and to see it continuing so successfully under David's excellent leadership as I knew it would. I do have a few policy points to make, but actually I wanted to first take a step back and just offer a few thoughts about how far we've come in ten years. Ten years ago, I was nominated but not yet confirmed to be the Under Secretary for TFI, along with Juan, who was nominated and not yet confirmed to be the Assistant Secretary. And I spent some time doing some research and reading up on this office that I was going to be leading, and I'd read a lot about the history of financial measures and sanctions. And I must say, there was a clear consensus. These things don't work. And there, you know, sanctions are some, you could, anyone who took Economics 101, you know, sanctions, they don't work. They're symbolic at best. They hurt the people you're trying to help by depriving them of things that they need. They don't change the behavior of intransigent regimes. The countries that implement sanctions, those are the countries that get hurt because their companies have to give up lucrative business. The countries that honor the sanctions, their economies get hurt as well. And it's the countries that cheat that benefit. And basically, it was very easy to write an article about the history of how these things fail. So that was really encouraging. And then there was a huge amount of skepticism in Washington about this new office, because if you remember, Treasury had just given up all of its law enforcement with the Department of Homeland Security, and as Juan and I would go up to the Hill and talk to people about this new office, we'd often hear, what do we need this thing for? We just created the Department of Homeland Security. They've got the Custom Service. Why can't they do all of this stuff? Why can't they do this? And then on top of that, it was a really, really small organization. And you heard the comment to Secretary Lew that there are 700 professionals now, but at the time, it was very, very small. I think the policy office that, the big secret we had, the only thing that was really classified, was that Juan and Danny Glazer, who were leading the policy office, really only had them and about seven other people, and they were doing all this stuff, and no one knew that it was so small. The situation was pretty demoralizing at the time. Let's just say, and when I reflect on this event, it was pretty hard to imagine an event like this, with the Secretary of Treasury speaking, with two national security advisors talking. The one thing that they, I thought it was great they agreed on, that the one thing to worry about is that TFI was a victim of its own success, and maybe we were going to overuse these things in the future. I think that's a nice to have problem, if you will. And the transformation that occurred from the beginning until now is, highly to my mind, by two anecdotes that both happened to involve Moammar Gaddafi. So very early on in my tenure at Treasury, this is a time when you recall that Gaddafi had given up the WMD programs in Libya, and apparently he was grousing to the State Department that no one had visited Libya. And so I got the short straw, and Adam Zubin and I took a trip to Libya, and at the end of our visit, they asked us to, just as we were getting ready to leave, they asked us to get on a plane, and it turns out to be Gaddafi's plane, and they fly us out to the desert, and we go to his oasis, and he's sitting out there, he's got a white track suit on, and a sailor's cap, and orange sunglasses, and we walk out there and introduce ourselves, and I remember one of the first things he said to me was, I'm glad you've come. Can you deliver a message to George Bush? I want to send a message to George Bush, and I don't remember exactly what I said, but I remember what I thought, which is I don't think George Bush could pick me out of a lineup, and I don't know how this is going to go. So fast forward to my very last day at Treasury, very last day in 2011. At that time, Gaddafi was conducting attacks on civilians in Libya, and we in the administration were considering putting sanctions on them, and again, I turned to Adam, and we asked, well, if we put sanctions on, what kind of money are we going to, you know, find here in the United States? And I come back from a deputies meeting, probably with Michelle and others, and I have an e-mail from Adam, which says that we've canvassed and it looks like there's $20 billion in the United States or so, and he says that's not a typo, that's billion with a B. And unfortunately for Gaddafi, my ability to get a message to the President had improved. Because I walked over my phone, called Dennis McDonough, talked to Tom Donilon, literally by the end of that day, an executive order had been signed by President Obama, and turned out there was even more than that, that ultimately the Treasury Department ultimately froze for the benefit of the Libyan people. So we'd come quite a long way in that period. So what really had changed? What accounts for this kind of success? And I think it was great to sit and listen to Secretary Lew and to listen to Tom Donilon and Steve Hadley. The fact is the team at TFI delivered effective strategies in a number of different categories, on terrorism in North Korea, on Iran, et cetera, and that kind of success breeds success and you get more support. And I just want to mention kind of what are the features of, why did these things work in the history of sanctions that was so unsuccessful? And I'd point to three things. One is, as you've heard, that we focused instead of on country sanctions, instead of putting embargoes on countries, we focused on illicit activity, on bad conduct. And then when you try to build a coalition, it's not purely political. It's not just the countries that agree politically with the United States, but it's rather those who will stand with you against that kind of activity. And when you're talking about terrorism and money laundering and proliferation, it's pretty easy to build that kind of coalition because there's a huge group of countries and private sector actors who are committed to the integrity of the system. Second, we focused, again, as Steve Hadley mentioned, on the private sector explicitly. And we kind of learned, I would say, that the private sector was perhaps even more important than governments in this effort because when you think about country sanctions and trade sanctions, the private sector has a particular reaction to them. They know it's the rules and they have to follow them and they'll try to follow them, but there's no other incentive to go along with it. So they'll do everything they can to go just to the line and try to work around them. But when it's conduct-based sanctions, they have reputational interests. They have their own sense of integrity about the system and they actually will try to amplify what you're doing. And so much of what we have seen the success that the Treasury has had is by having the private sector do much more than is required simply because they don't want to be involved in illicit conduct. And we made it a point to reach out directly to the private sector extensively in order to build that part of the coalition. And then you find, once the private sector is working with you, that governments find it easier to go along as well. So if the banks and the big companies in their country stop doing business with Iran, say, then it's much easier for that country to go along and impose tougher sanctions. And the third thing that characterized these strategies is that they were all underpinned by intelligence. And this is, I think, the big... What is the one... If I had to point to the one thing that changed the Treasury from 2004 to the present is that it's fully a member of the intelligence community. They have full access to the intelligence community. They've built a tremendous office of intelligence and analysis. I see Leslie Ireland here who leads it now. But let me tell you what it was like in 2004. We had a grand total of zero analysts in the Office of Intelligence and Analysis at Treasury. And Janice Gardner, who was our first assistant secretary, built this thing from scratch. I still remember that our then-no-fact director, Bob Werner, offered her five analysts saying, okay, we'll give you five analysts to start with. And we had a hard time moving those five analysts to the Office of Intelligence and Analysis, because the people on the Hill said, wait a minute, why do you need those people at Treasury? And it's come a long way. You cannot build this kind of conduct-based strategy without that intelligence. And Iran, which we've heard some discussion of, is the perfect example. So in 2006 or so, Steve Hadley and Secretary Rice turned to us and said, we need a strategy to put pressure back on Iran and to give us some leverage. And at the time, I actually think Steve said it here. There were many people, including people in the White House, thought we were, quote, sanctioned out on Iran. And you could understand that because we had comprehensive sanctions on Iran already. You couldn't do business with Iran in the United States. You couldn't buy their oil. Our banks couldn't transact with Iran. So those kind of sanctions were already there and they weren't working. So we had to design a strategy that was specifically designed to get other countries to join us in maximizing pressure and get the world to cut off Iran. And we came up with a plan that you've seen play out, which is start by focusing on their conduct. And that depended on having the intelligence. And our intelligence analysts pulled together the network of how Iran was funding terrorism, how they were acquiring items for their proliferation program, how they were acquiring items for the missile program, and how the private sector was unwittingly involved, how they were part of the transaction chain. And we made it a central part of the strategy to go directly to the private sector because, and it was Secretary Paulson who was a big advocate of this, he knew, and it turned out to be true, that when you went to these financial institutions and you said, look, you're in this transaction chain, actually they want very much not to be in that transaction chain. It doesn't take much to persuade them to cut off that kind of business because they really don't want to be in that kind of business and they were appreciative of it. And at the same time, as you all know, we targeted the guilty parties in Iran, we exposed what they were doing, we made the illicit conduct public so that everyone knew this was going to be a serious effort and we're going to go after it. And we briefed our allies on the plan. We told these other governments who knew we had to put pressure on them what the plan was to impose this pressure. And it was a huge diplomatic effort and it was not just the Treasury Department, we couldn't have done it ourselves. Every government leader was helping. When congressional leaders, actually now I'm looking at former representative Harmon because she used to call me when she was going on trips and say, here's who I'm meeting with. How can I help? And we used to collaborate to get support from the Hill to get people to work with us on this. And I remember conversations with her about that. And it worked like we hoped. The banks did cut off the business, the private sector did cut off the business and it did make it easier to build that coalition. And over time, the skepticism toward it faded and we were able to get much, much tougher sanctions over time. There were lots of other things that contributed to that but it was part of it. And again, Iran as we predicted tried to evade. They tried to evade the sanctions but unlike prior country sanctions where evasion works, we turned evasion into an advantage for us because we had good intelligence, we could expose the evasion and continue to use it to feed the same dynamic. And as we heard in the first panel, it's unclear how this thing will end. No one knows how it will end but to the extent Iran is considering giving up its nuclear weapons, its pursuit of nuclear weapons, it's certainly been at least in part because of the leverage that comes from a properly executed set of financial measures. And I think it's been a true bipartisan success. As I just mentioned, this is a strategy that had complete support from Democrats during the Bush administration and complete support from Republicans during the Obama administration. And that's something which I personally found maybe the most gratifying part of it. So I just want to make a couple of points about how TFI can build on this record of success. And, you know, I don't think that just we had breakfast this morning and David and Secretary Lew were saying that we've got to continue to innovate if it's going to continue to be successful. The bad guys are going to innovate, we have to continue to innovate. And I just wanted to make two points and they actually tie to the two panels that you're going to hear later. One about the role of the private sector where Ruben Jeffery and Neil Wollin are going to speak about the intelligence. And the private sector, I think, has been crucial, as I said, to the success of TFI that they've been able to build this partnership with the private sector and get the private sector to amplify their actions. But there's another aspect to the relationship between the Treasury and the private sector, and that's the flow of information back and forth. And that has been something that has greatly improved since 9-11 and in the last 10 years, the kind of information that goes back and forth between the government and the private sector has improved both the reporting that we do, I say we now because I'm obviously in the private sector now at a very large bank, the reporting that we do to the government and also some information we get back from the government. That said, I think this is an area where there is still great untapped potential for better collaboration. And I use the word collaboration intentionally because there is a shared objective which is the integrity of the financial system the private sector has that and the government has it. And there are shared adversaries which are illicit actors. Again, the private sector has the same adversaries that the government does. But in many ways, the government and the private sector are sort of fighting against the shared adversary with one arm tie behind their back because they're not collaborating with the information as well as they could. For the most part, the institutions are analyzing their own information, putting it together with what they can purchase and glean from the public sources and commercial databases and trying to find the anomalies, trying to find the bad guys so that they can then share that information with the government. They do that for the most part with the most important insight they could have which is what is it that the government is already seeing and worried about what is their analysis of the particular threat. And I believe that it is a potential game changer in this effort if there could be found a way to collaborate better. And I know there's a lot of good hard work already going on about this but the collaboration is not yet comprehensive. I don't get it to be that way. Everyone would benefit because the kind of information and the kind of analysis that the private sector would pass back to the government would be so much more valuable and rich and that would help the government to understand the threats. And I think this is something which from my current position I see even more as an opportunity for building on prior success. The second point I'd like to make is about the role of intelligence. As I said a couple of times intelligence is absolutely key to these strategies and there's been a lot of debate obviously in the public now about the what is the appropriate amount of intelligence collection and I think that debate is healthy in a democracy that's perfect to the appropriate and I don't intend to kind of weigh in heavily on the whole debate but I just want to make one point people should consider the cost of not being able to do this. What David and Danny Glazer and Adam tried to present to the president in very tough circumstances are real options to deal with tough problems that and to do so in a way where their military force isn't going to be needed and you can't overestimate the value of that if you can settle something without military force without the kind of information and intelligence that can feed a real strategy then you're left with these kind of sanctions that we know all these people who are writing about them are right they don't work and so you're going to leave the president without that kind of authority it's very hard to value that because of the value of that but I think it's substantial to be able to have those kind of strategies offered to the president when he's got very very tough decisions to make and I know it's something that the Treasury Department really needs this information I'm going to just stop there I want to thank you all again for letting me participate in this I spent seven years working alongside the team at the Office of Terrorism and Financial Intelligence at Treasury and everyone who knows who works with me at the time knows that this is what I say this next thing is really from the heart that was for me an honor of a lifetime and I'm very proud that we've put together something that is that has stood the test of time and I'm most proud of the fact that it is a bipartisan thing that is something that everyone recognizes as valuable I hope that it will remain that way I'm sure under David's leadership it will thank you