Senate Democrats urge ending telco wiretap immunity

WASHINGTON (Reuters) - U.S. Senate Democrats on Thursday proposed rescinding legal immunity granted to phone companies like AT&T for participating in the government's controversial warrantless wiretap program.

If rescinding the immunity is approved by the Senate and House of Representatives and signed into law by President Barack Obama, it could open the telecommunications companies to scores of lawsuits.

In 2008, the Democratic-led Congress approved shielding the carriers from past and future lawsuits that accuse them of improperly participating in the program launched by the Bush administration after the September 11 attacks in 2001.

With the Bush administration hoping to end the long-running dispute, lawmakers backed the immunity on the basis it was needed to win future wiretap cooperation from the companies.

Civil liberties groups have complained the carriers should be held liable for participating in a program that they say was illegal.

Rescinding the immunity for phone companies was included by Senate Democrats in a broad package of reforms to surveillance methods from the Bush era. If passed, they would mark a shift now that the White House is occupied by Obama, a Democrat.

"Our bill strikes a careful balance between the law enforcement powers needed to combat terrorism and the legal protections required to safeguard American liberties," said Richard Durbin, the Senate's second-ranking Democrat.

Representatives for AT&T or Verizon Communications, the two largest U.S. telephone carriers, were not immediately available for comment. A Justice Department spokeswoman declined to comment.

The Senate Judiciary Committee will hold a hearing on potential changes to surveillance techniques next week.

The Obama administration earlier this week asked Congress to reauthorize the use of three techniques that expire later this year -- roving wiretaps, access to business records and tracking suspected foreign militants who may be working individually rather than as part of a larger group, known as the "lone wolf" authority.

While there is some support for renewing those methods, some Senate Democrats have said they want to bolster privacy protections, something the Obama administration said it was willing to consider.

But they did not propose extending the "lone wolf" tracking authority that has never been used, according to a congressional aide.

The group of seven Senate Democrats and one independent did propose extending the other two surveillance methods but with additional restrictions, such as requiring that roving wiretaps identify either the person or phone to be wiretapped.

Their proposal would also overhaul National Security Letters, which are essentially subpoenas for individuals' records. The legislation would limit them to records of people who have some suspected connection to terrorism or espionage, according to details the lawmakers released.

(Editing by John O'Callaghan and Peter Cooney)