The use of a group warrant to spy on a small number of individuals who might have been plotting a terrorist attack may not have been lawful or proper, according to the watchdog over New Zealand’s spy agencies.
But the NZ Security Intelligence Service (NZSIS) says it would have been “irresponsible” not to use the full suite of available powers to investigate the people involved.
This particular warrant is one of several issues highlighted in the annual report, released today, from Inspector-General of Intelligence and Security Brendan Horsley into the activities of the NZSIS and the Government Communications Security Bureau (GCSB), which investigate and monitor threats to national security.
Horsley noted in particular the NZSIS’s use of class warrants, which allow otherwise unlawful surveillance against a group of people for up to 12 months, rather than individual warrants.
“It has become apparent that a class warrant can be drafted to cover any NZSIS investigation, no matter how closely it might be focused on a particular person,” Horsley said in his report.
A class warrant needs to be externally approved but once that is done, the NZSIS can then include a person under that class and then start spying on them “without their existence or any intelligence on them having been presented to anyone outside the NZSIS”.
“That is obviously convenient for the agency, but I seriously question whether it is consistent with the concept of a warrant as a safeguard for the rights of anyone prospectively in the sights of a state security agency,” Horsley said.
“I reviewed in depth a particular NZSIS class warrant emblematic of my concern. I questioned whether it was lawful or proper.”
He said he had provided a classified review on the warrant to the agency, its Minister [Andrew Little at the time] and the Chief Commissioner of Intelligence Warrants. He has also prepared a public report while the matter remained under discussion.
In a statement, NZSIS director general Andrew Hampton said the class warrant in question related to a very small number of individuals “who were targeted over concerns around terrorist attack planning”.
“It would be irresponsible of me, given the increasingly complex and dynamic threat environment that New Zealand faces, not to seek to use the full range of legislative tools available to the NZSIS,” Hampton said.
“Class warrants are available for the Service to use under legislation, and based on advice received externally and internally, I am assured our use of class warrants is compliant with the [Intelligence and Security] Act [2017].”
A review of that law in January 2023 recommended looking at changing it “to more clearly identify when it is appropriate to determine that an individual fits within an existing class warrant”, or whether a new individual warrant should be applied for.
Hampton said the NZSIS was “mindful” of Horsley’s observations, and had made changes to documentation when seeking class warrants. Horsley’s concerns were also taken into account in the issuing of the most recent class warrants, which must be approved by the overseeing minister and the Chief Commissioner of Intelligence Warrants.
Horsley’s report also noted the NZSIS’s greater use of bulk personal datasets, and its wish to expand access to the datasets held by other government agencies beyond what is currently available to them: registered births, deaths and marriages, citizenship, Customs information, and Police financial intelligence.
Most of the people who the NZSIS has personal datasets about are unlikely to be of intelligence or security interest, Horsley said.
“The more an intelligence agency makes use of ‘bulky’ data (containing information on large numbers of people who are not of security concern), the more important are post-collection controls on access to and use of that data.
“The Service is developing systems and procedures to support its growing reliance on data holdings and analysis, but mature and fully satisfactory arrangements are still some way off. The Service acknowledges this and for the moment I am satisfied it is proceeding with a proper degree of caution.”
Horsley undertook an unscheduled audit of NZSIS procedures on how it categorises people as being of security concern or intelligence interest, but who don’t require investigating.
“My office noted a large and sudden increase in the number of overseas-based individuals categorised by NZSIS as being of interest. It emerged also that the NZSIS had decided to cease reviewing some categories to verify that the inclusion of people in them remained relevant.”
The audit raised questions about how the NZSIS manages and reviews records on these individuals, including “an absence of systematic necessity and proportionality assessments, data issues, and a lack of recording long-term trends and data”.
“Though [the NZSIS] has not accepted my recommendations, it has reduced my concerns to some extent. My office will continue to monitor the relevant processes and I anticipate revisiting the matter in future, by review or further audit.”
Horsley also noted that the number of complaints against the NZSIS and the GCSB had roughly doubled in 2022-23. Of the 39 complaints during that time, all were from members of the public rather than agency employees, and most - 32 of 39 - were about the NZSIS.
Two of the complaints warranted particular scrutiny, he said.
One involved a complainant who was concerned that “informal exchanges with the NZSIS” had led to the withdrawal of a job offer from a prospective employer. Horsley found the NZSIS had acted appropriately but recommended the NZSIS meet with the complainant to explain what had happened, which it did.
The second case involved the NZSIS recommending a security clearance by a “sponsoring agency” for someone but with a note to manage a specific security risk. After they complained, Horsley looked into the matter and the NZSIS said it made a mistake and apologised to them.
Horsley also found the compliance systems for both the NZSIS and the GCSB “under-developed” due to the number of policies that are overdue for review.
Hampton said the NZSIS was in the process of updating its policy framework after an evaluation in 2020.
“As the incoming Director-General, ensuring all policy procedures are up to date is a priority, with a governance group and agreed strategy in place to achieve this over the next 18 months.”
Derek Cheng is a senior journalist who started at the Herald in 2004. He has worked several stints in the Press Gallery and is a former deputy political editor.
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