Commerce Department eliminates "rogue" unit racial profiling Chinese American employees

Department of Commerce Secretary Gina Raimundo.

Amid rising anti-Asian violence and xenophobia, the Commerce Department announced that it would be eliminating the Investigations and Threat Management Service (ITMS), a little-known, rogue unit in the deapartment that has been, without authorization, investigating Chinese and Middle Eastern employees based only on their ethnicity. 

The announcement Friday (Sept. 3) came after department investigators released the findings of a nearly five-month internal review that concluded that the Investigations and Threat Management Service improperly opened investigations “even in the absence of a discernible threat” and operated outside the bounds of its legal authority.

“State-led xenophobia and prejudice against Asian Americans and Middle Easterners has led to greater public suspicion of these communities and contributed to an historic rise in hate crimes and incidents," said California's Rep. Judy Chu. 

"Worse, this unit was able to conduct its race-based investigations without the oversight or accountability of actual law enforcement agencies," said Chu, chair of the Congressional Asian Pacific American Caucus.

The department has accepted the recommendations from the report, including the recommendation to permanently end the criminal investigation function ITMS performed. Within 90 days, ITMS will be eliminated and within 180 days, the additional recommendations will be implemented.  

The Department began its review of ITMS after receiving a report from the Office of Inspector General (OIG) addressing allegations of misconduct concerning ITMS spanning several years. After receiving the OIG report, the Department suspended all investigative activity and initiated a review to assess the overall practices, policies, and performance of ITMS in fulfilling its missions and recommend a future path for ITMS.

“The Commerce Department leadership team took the ITMS allegations very seriously and upon learning about the concerns, immediately suspended all criminal enforcement activity and initiated a 90-day review to determine a comprehensive solution that would address these issues,” said Deputy Secretary Graves. “Commerce leadership has reviewed and accepted the recommendations in the report and will begin implementation immediately.”

The report outlines four recommendations for the Commerce Department to address the programmatic and systematic issues raised about ITMS.

• The Department should eliminate ITMS, discontinue the criminal law enforcement function that was part of ITMS’s mission, clarify that the Department does not possess the authority to conduct counterintelligence activities, and redistribute other remaining functions of ITMS to other offices.

• The Department should establish an enhanced oversight framework for its administrative security investigations and insider risk management activities.

• The Department should update its written policies for its administrative security investigations and insider threat functions to ensure that they comply with all applicable laws and ensure that adequate safeguards exist to protect civil rights and civil liberties.

• The Department should continue ongoing work to close and archive ITMS cases, establish an appropriate schedule for the destruction of this information that complies with applicable law, and implement policies to ensure that no information developed by ITMS records inform future decisions without a prior legal review and independent factual corroboration.

The Department has taken personnel actions in connection with findings of misconduct regarding ITMS. Those cannot, by law, be disclosed. 

Earlier this year, CAPAC Chair Rep. Judy Chu called for this unit to be disbanded after a report released by Senator Roger Wicker, the Ranking Member of the Senate Commerce Committee, showed that ITMS had taken on law enforcement activities that treated employees as national security threats based on their race and background, and did so with no oversight or accountability. 

Not only were these investigations unjustified and flawed, they failed to uncover any national security threats despite the thousands of investigations that were opened and the numerous lives ruined. 

According to whistleblowers, constitutional protections for Asian Americans were regularly ignored in search of proof to justify improperly started investigations.

Established during the George W. Bush administration, ITMS was intended to protect the Secretary of Commerce. But under successive administrations, this unit began to engage in law enforcement and counterintelligence activities, despite lacking any proper authorization. 

According to multiple whistleblowers, this unit overwhelmingly targeted Asian Americans, opening thousands of investigations even without evidence, based only on ethnicity. But, according to the report, these cases were regularly dismissed by Federal prosecutors “based on identifiable flaws in methods.”

The unit seized "work phones and computers to perform digital content searches, and picked the locks of offices and personal storage containers," according to the Senate report that spurred the OIG investigation

ITMS also repeatedly "engaged in broad searches of Department of Commerce servers for particular phrases and words in Mandarin as part of talent recruitment investigations," the OIG report says.

According to the report, ITMS would often open cases and even if no incriminating evidence was found, would leave the cases open, leaving the employees in a ligal limbo uncertain of their status or future. At last report, 2000 cases have been opened but not closed, according to the New York Times.

Sherry Chen, victimized by Commerce Department investigators.

The most infamous case involved Sherry Chen, a noted hydrologist, who was falsely accused of espionage in 2014. Because of the allegations, she was released from her job but had all charges against her dropped for lack of evidence. 

“Until now, my life is still in limbo," she said in a Congressional roundtable in June, 2021. "My reputation is still under a cloud. 

"The ordeal has taken away precious time in my professional career, and I can never recover the years I have lost. This injustice has now entered its tenth year and sadly there is still no end in sight."

 

Despite having the charges dropped, she still has not been reinstated. She finally had to resort to a civil suit, which is winding its way through the courts.

"I keep fighting not only for myself but to do my part to make sure no one should ever be harmed because of their race or country origin,” said Chen. 

“We are committed to maintaining our security, but also equally committed to protecting the privacy and civil liberties of our employees and the public,” said Commerce Secretary Gina Raimondo in a statement.

“While there are legitimate national security concerns related to China, there is no place for the kind of racial profiling conducted by ITMS in our government," said Chu. 

"Eliminating this rogue unit is an important step, but our communities will not be safe and equal until we put an end to all racial profiling, like the China Initiative, which presume individuals are national security threats based only on their ethnicity.”

For more information, see full report.