WASHINGTON (Reuters) - The U.S. National Security Agency's bulk collection of phone records provides only minimal benefits to countering terrorism, is illegal and should end, a federal privacy watchdog said in a report to be released on Thursday and reviewed by Reuters.
The watchdog agency's report could further complicate efforts by both President Barack Obama and Congress to come up with possible reforms to NSA eavesdropping programs, which have been under harsh scrutiny in the wake of revelations by former NSA contractor Edward Snowden.
The Privacy and Civil Liberties Oversight Board, which produced the new report, is an independent government agency within the executive branch that advises the President and Congress on how to ensure that counterterrorism operations also protect Americans' privacy.
In its report, the board called on the government to end the NSA program that collects U.S. telephone records in bulk and to purge the data it had collected, adding ammunition to efforts by privacy advocates to win new restrictions on government surveillance programs.
"The Section 215 bulk telephone records program lacks a viable legal foundation under Section 215, implicates constitutional concerns under the First and Fourth Amendments, raises serious threats to privacy and civil liberties as a policy matter, and has shown only limited value," the board said in its report.
The board's conclusion that NSA's bulk collection of Americans telephone metadata lacks legal grounding goes further than both the president and an ad hoc panel he created to review NSA eavesdropping activities.
In its report released last month, the review panel, which included former White House and intelligence officials, also raised questions about the value of telephone metadata collection in producing counter terrorism breakthroughs. The panel recommended that metadata collection should continue, but that data should henceforth be stored either by telephone companies or an independent third party.
In a speech on Friday, Obama agreed that the storage of telephone metadata should be moved out of government hands but did not call for an outright halt to the collection of such data by the NSA. The president also said that such data should not be searched without judicial approval.
However, he left specific details of how the telephone data collection program should be reformed up to intelligence advisors, the Justice Department and Congress.
Congress is already sharply divided over what to do with the telephone metadata collection program, which collects data on millions of phone calls made in the United States but not the content of the calls.
Intelligence committees in both Houses recommend that current collection and storage arrangements be maintained, while Judiciary committees have recommended that such collection be outlawed.
The privacy board recommended against asking private parties to routinely store data for the NSA's use and said other existing laws could be used to access phone records if needed.
The White House on Thursday said Obama and members of the administration had earlier met with the board's five members and reviewed a draft of their report, taking the board's recommendations into account before the report's release.
"We look forward to its release and expect to factor it into our thinking on these issues moving forward," said White House National Security Council spokeswoman Caitlin Hayden, but added: "Specifically on the Section 215 bulk telephony metadata program, we disagree with the Board's analysis on the legality of the program."
The five-member privacy oversight board itself split along party lines on the report, with three Democrats supporting and two Republicans writing separate opinions in opposition of ending the bulk collection program.
"I don't believe the Board should go outside its expertise to opine on the effectiveness of counterterrorism programs. As those of us with law enforcement experience know, successful investigations use all available tools - there often is no "silver bullet" that alone thwarts a plot," said House Intelligence Committee Chairman Mike Rogers, a Republican and staunch defender of the NSA's work.
The board, whose review was based in part on classified briefings and documents, said it found no terrorist attacks thwarted or previously unknown terrorist plots discovered through the program in the previous seven years.
"We have not identified a single instance involving a threat to the United States in which the program made a concrete difference in the outcome of a counterterrorism investigation," the report said.
The board concluded that the NSA collection raises constitutional concerns with regard to U.S. citizens' rights of speech, association and privacy.
"Permitting the government to routinely collect the calling records of the entire nation fundamentally shifts the balance of power between the state and its citizens," it said.
It also called for Congress to authorize the creation of panel of outside lawyers to serve as privacy advocates in the secret Foreign Intelligence Surveillance Court that oversees NSA eavesdropping procedures. It also urged further declassification of FISC rulings.
The Privacy and Civil Liberties Oversight Board was established at the recommendation of the 9/11 Commission in 2004. At the request of lawmakers and Obama last year, the board reviewed U.S. intelligence gathering programs and it will issue a separate report on Internet surveillance.
Reporting by Alina Selyukh,; Additional reporting by Eric Beech, Steve Holland and Mark Hosenball; Editing by Stephen Powell and Chris Reese