Revenue for the third quarter of 2004 was a record $US63.5 million, up 14 per cent from the same quarter of 2003 and up 4 per cent sequentially due to continued strong sales to enterprise customers and better traction in the public sector markets including video surveillance, public safety solutions, and lawful interception.

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Net income increased 48 per cent to $US5.2 million, or $US0.28 per fully diluted share, compared with $US3.5 million, or $US0.21 per fully diluted share in the third quarter of 2003. EPS increased 17 per cent sequentially.

Commenting on the quarter, Haim Shani, president and CEO of NICE, said, “We again achieved record revenues and we were particularly pleased to see that we are beginning to get some traction in the public sector where revenues were up 18 per cent year over year and up 17 per cent sequentially.”

Gross margin increased to 54.7 per cent from 53.0 per cent in Q3 of 2003 and 54.3 per cent in Q2 of 2004, primarily due to increased volume.

“As planned, we continued to spend on our key strategic initiatives, including the launch of NICE Perform,” continued Mr. Shani. “Even with this continued investment, we were able to substantially increase our operating profit.”

The company reported a Q3 operating profit of $US5.1 million, up 118 per cent from $US2.3 million in the year earlier period, and up 31 per cent from $US3.9 million in the second quarter of 2004. Operating margin increased to 8.1per cent from 4.2 per cent in Q3 of 2003 and 6.4 per cent in Q2 of 2004.

Total cash and equivalents at September 30, 2004 rose to $US146.0 million, compared with $US135.8 million at June 30, 2004. DSO for the third quarter was 68 days, at the low end of the target range.

“Demand for VoIP products remains strong, also contributing to our growing orders. During the quarter NICE filed a lawsuit against Witness Systems seeking an injunction preventing the sale by Witness of any solution which infringes NICE’s VoIP patent.

Witness has, in retaliation, filed a patent infringement suit claiming that NICE has infringed two of its patents relating to screen capture. We believe the suit is without merit and will defend ourselves vigorously against this retaliatory claim.”

Commenting on the outlook, Mr. Shani said, “Similar to last year, we expect a very strong fourth quarter. We continue to experience strong bookings with over a 1:1 book to bill ratio, and we were gratified that Q3 bookings included 8 deals for our new NICE Perform suite which was launched at the beginning of the quarter. No revenue from these deals was recognized in Q3.

“We reiterate our guidance for the year, and expect revenues in Q4 to grow to between $US67 million and $US70 million, with EPS between $US0.44 and $US0.49. 2005 promises to be another year of growth in both the enterprise and public sectors with excellent operating leverage that will enable our EPS to grow substantially faster than revenue,” continued Mr. Shani.

“Our preliminary guidance for 2005 calls for revenues between $US275 and $US280 million and EPS of $US1.40 to $US1.50.”

Bewator also announced today that it has divested its Business Area Parking (Cale Access AB) to Swedish Mellby Gård <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />IndustriAB, that also is part owner of Bewator Group. Bewator is thereby concentrating all its operations to the growing access security market. 

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Antech is a market leader in the distribution of video security products in Scandinavia. Founded in 1988, the company has built a market leading distribution business in video security products in Denmark and Sweden. The company has 17 employees and has its headquarters in Brøndby, Copenhagen.

Through this acquisition Bewator continues to strengthen its market position in access security solutions in the Nordic region.

Bo Kastensson, CEO of Bewator Group says “Bewator is committed to delivering the best security solutions and services to end-users via our market leading network of partners and installers. Antech will bring to our customer base CCTV market knowledge, and will benefit from Bewator’s large installed base and expertise in integrated systems.

“The acquisition of Antech will also help strengthen our in house competences in the design and supply of total security solutions in Scandinavia” continues Bo Kastensson, “and will improve Bewator’s competitiveness in its all important home market”.

Antech’s knowledge in network and IP CCTV solutions complements Bewator’s strategy to deliver open, modular security systems (e.g. the integration of the Bewator 2010 system with the Eventys digital video management system). The combination of both companies’ expertise will, amongst others, provide a strong platform for integrated access control and video security over IP.

Through the merger of Bewator and Antech, the potential has been created for an efficient integration between security systems in access control, alarm systems and video control, areas where Bewator has a recognised market position.

“Antech has developed positively through the years and can now enjoy a faster growth as part of an internationally recognised leading security group. With the addition of Bewator’s development resources and international network, we will be able to benefit from a leading position in Sweden and a strong position in the other Nordic countries as well as business opportunities in many other European market,” says Michael Anthonsen, MD of Antech A/S.

Introduction of the ID cards will occur over the next 12 months, with all new licensees receiving the new IDs, and current licensees receiving theirs on renewal.

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The cards will include details such as licence class, licence number, expiry date, licensee’s name, photograph, and any conditions of the licence, reports ASIAL’s website.

According to the ASIAL release: “All security officers must carry a licence with them at all times while on duty. Crowd controllers must also wear identification with the word “SECURITY” on their clothing so the public can easily identify them.

Keech is reported to have got: “Overwhelming support from the security industry on the introduction of the new ID cards. “I appreciate the support I have received from the industry and will continue to work closely with them to ensure <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Queensland has the best security legislation in the country,” she said in the release. 

ADT installed video and audio links from CCTV systems across the council which carry signals to a remote site control room in Ilford Town Centre. All sites are monitored simultaneously, meaning fast response from the fewest possible staff.

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Matt Gibbs, Redbridge Council’s CCTV Manager for Community Safety, Public Protection told <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />SecurityPark: “Britain’s local authorities are constantly looking to improve public protection, but frequently hit a brick wall when it comes to funding a complete overhaul. ADT solved our problems by suggesting we make use of our existing LAN network, minimising disruption and installation times, as well as cutting our costs. By linking the new systems into our central control room, we can channel our resources to ensure constant monitoring through leading-edge technology systems.”

John Hedges, of ADT, added: “This work is a real achievement for ADT, as it reflects the public sector’s growing awareness of evolving security needs, which we have worked hard to drive. The fact that we have successfully utilised the existing network services is big news for the industry as a whole – opening up new avenues to us all. Redbridge Council is so delighted with the system and the results it is getting that they are now looking at the possibilities of integrated installations in schools, parks, libraries and selected public areas through the LAN – which would be a real ‘first’ for the industry.”

According to the SP report: “Lee Shelford, ADT Project Manager and Resident Technical Engineer for the Borough has spent the last few years working closely with the Borough and leading edge technology manufacturers to design and integrate many different applications with the purpose of meeting the Borough’s crime reduction objectives through the use of CCTV technologies. Most recently, breakthroughs have been made with digital wireless networking allowing real-time quality images to be transmitted over great distances at minimal cost and then integrated into the existing analogue matrix using digital interfaces.”

Lee Shelford told SP: “Redbridge Council is very open to trial new technologies and software in the fight against crime to ensure public safety. Working closely together and involving manufacturers has enabled us to utilise applications that are still in the design and infancy stage. This refreshing approach has allowed us to surpass conventional methods and achieve greater results.”

The net income for the third quarter of 2004 was $US198,000, or $US0.00 on a basic and diluted share basis, compared to a net loss of $US389,000, or $US0.02 per basic and diluted share, for the third quarter of 2003.

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The Company’s third quarter results do not reflect any contribution from the recent acquisition of Imaging Automation (iA); financial results for iA and Viisage will be combined from October 5, 2004, the date the transaction was completed.

On December 30, 2003, Viisage adopted new accounting rule EITF 00-21, “Accounting for Revenue Arrangements with Multiple Deliverables,” which pertains to revenue recognition for certain long-term contracts, such as Viisage’s state drivers’ licenses, retroactive to January 1, 2003.

“Viisage made important progress, financially and operationally, during the third quarter, as we expanded our product suite for identity solutions and produced a profitable quarter,” said Bernard Bailey, president and CEO of Viisage.

“We have greater traction with existing and prospective customers in a wide range of markets, and feel that we are well positioned to continue our growth. We were pleased with the reception given Viisage by the financial community despite the difficult market environment that existed during our recently completed follow-on offering, and plan to use the proceeds to further build our market leadership in identity solutions.

“With the addition of critical proofing and document authentication capabilities from iA, we are offering customers a comprehensive technology solution that truly addresses their needs.”

Bailey concluded, “The Company’s performance for the third quarter, combined with our accomplishments so far this quarter, give us the confidence to increase both our revenue and EBITDA guidance for 2004.”

Bill Aulet, Viisage’s chief financial officer, added, “Viisage continued to significantly improve its financial performance and strengthen its balance sheet in the past quarter while maintaining the necessary financial flexibility. Our strong revenue performance coupled with careful expense management enabled us to produce our first profitable quarter on a GAAP basis in several years.

At the same time, our focus on growing EBITDA (earnings before interest, taxes, depreciation and amortization) proved successful as it increased to $US3.4 million this past quarter, from $US1.5 million in the same quarter last year. Lastly, we are pleased with the terms of our acquisition of Imaging Automation, since we believe this transaction will be accretive on a net income, EBITDA and EPS basis in 2005, and will help us continue to drive revenue and profit growth not only this year, but for many years to come.”

Highlights for the third quarter of 2004:

    —  Adding experienced Department of Defense executive Kenneth

        Scheflen as senior vice president of Federal Solutions group

    —  Signing cooperation agreement with Siemens AG for 3-D face

        recognition technology development

    —  Unveiling vision for new identity solutions product suite

    —  Launching innovative Viisage PROOF(TM) product

Following the close of the quarter, Viisage announced the receipt of a contract valued at approximately $US534,000 from the Ohio Department of Rehabilitation and Correction for a criminal identification system, as well as a new driver’s license contract for Wisconsin, a contract extension for Maryland and expansion of face recognition solutions into existing driver’s license contracts, all of the above totaling $10.91 million.

Separately, on October 5, 2004, Viisage announced the acquisition of privately-held Imaging Automation (iA), the industry and market leader in automated identity document authentication technologies. iA has more than 2,300 installations in 20 countries around the world.

Financial highlights for the third quarter of 2004:

    —  Record revenues of $US19.91 million

    —  Company’s first profitable quarter in three years, with net

        income of $US198,000

    —  Gross margin down slightly to 28% from 31% in the second

        quarter this year, reflecting product mix, and down from the

        record high 33% recorded in last year’s third quarter

    —  Generated EBITDA of $US3.4 million, compared to $1.5 million in

        same quarter last year and $3.1 million in the second quarter

        of this year

    —  Increased cash position at the end of the quarter from $12.62

        million to $US37.36 million, reflecting successful completion of

        follow-on offering

    —  Further improved the balance sheet by reducing outstanding

        debt from $US29.8 million to $US19.2 million, with an estimated

        annualized decrease in interest expense of approximately 20%

    —  Backlog of $US140 million, compared to $US151 million last

        quarter

During the quarter, the Company completed the sale of 7.3 million shares of its common stock, along with approximately 425,000 shares of stock sold by certain shareholders, in an underwritten public offering. Net proceeds from the follow-on offering were approximately $US37.9 million for the Company.

Also during the quarter, Viisage proposed a settlement to the State of <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Georgia to resolve the ongoing litigation stalemate over the state’s driver’s license contract, awarded to Viisage in late 2002. The initiative entailed the termination of Viisage’s contract, a payment to Viisage of $US2.5 million and an agreement by the state to put the contract up for rebid later this year. This initiative is currently stalled following legal action taken by one of the Company’s competitors in the state.

Total operating expenses for the third quarter of 2004 totaled $US4.85 million, up slightly from the prior quarter this year, and an increase from the $US3.51 million reported in the comparable quarter last year, reflecting higher expenses following the acquisitions of ZN Vision Technologies and Trans Digital Technologies, legal costs from the litigation in Georgia and an increase in consulting costs related to a Sarbanes-Oxley compliance project.

Sales and marketing expenses were $US1.59 million, research and development totaled $US896,000, and general and administrative expenses were $US2.36 million. Total operating expenses in the same quarter last year included $US1.24 million in sales and marketing costs, $US946,000 in research and development and $1.33 million in general and administrative costs.

Called an ‘Air Cargo Scanner’, a device developed by CSIRO in <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Australia can accurately and rapidly detect illicit drugs and explosives concealed inside air freight containers.

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The Australian Customs Service and CSIRO have already successfully prototyped and tested the unique Scanner which uses world-first neutron technology developed by CSIRO’s On-Line Analysis and Control (OLAC) team at LucasHeights.

The team has an international reputation for developing novel instrumentation for the minerals and energy industries – the Scanner is one of their many successes.

The neutron technology is non-intrusive to minimise the impact of security measures on rapid freight movement, and it is estimated that scanning an air freight container will take less than two minutes.

The main advantage of the Scanner over current and potential new scanners is its ability to accurately and rapidly analyse the composition, shape and density of an object – in real-time without unpacking the container.

Conventional X-ray scanners are good at detecting objects based on their density and shape – but not their composition. The Scanner is unique in the way it employs gamma rays and neutron analysis to build an image and help identify the composition of the object being scanned.

CSIRO has now patented this truly world-first technology. When fully commercialised, the technology has the potential to earn millions of export dollars for Australia. The additional spin-off applications are equally exciting.

In the meantime, the Federal Government has allocated $A8.4 million dollars to the Australian Customs Service to construct a commercial-scale facility at Brisbane Airport to trial the first commercial prototype Air Cargo Scanner being developed by CSIRO. The Scanner is expected to be operational in mid-2005.

Revenue in the third quarter of 2004 increased 20% over last year’s third quarter to $1.20 billion, reflecting improvement in each of the Company’s business units. Revenues at Brink’s, Incorporated and BAX Global also benefited from stronger European currencies relative to the U.S. dollar.

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The Company reported operating profit of $58.7 million for the quarter ended September 30, 2004, up from $22.4 million in the year earlier period. The operating profit increase reflects strong performance in International operations at Brink’s, Incorporated, continued subscriber growth and solid operational execution at Brink’s Home Security and increased freight volumes in the <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Americas and Asia at BAX Global.

Operating profit for the recent quarter also benefited from a reduction in costs from former coal operations, partially offset by higher corporate expenses in comparison to a year ago.

Net income for the third quarter of 2004 was $38.1 million, or $0.68 per diluted share, down from $50.0 million, or $0.94 per diluted share, in the prior year’s period, which included $38.5 million or $0.72 per diluted share of income from discontinued operations mainly related to the sale of natural gas operations.

“Our businesses turned in another solid quarter of improved performance, building on the momentum of earlier in the year,” said Michael T. Dan, Chairman, President and Chief Executive Officer of The Brink’s Company. “BAX Global once again posted strong profit gains, particularly in the Americas where we continued to see increased shipping volumes mainly related to the improving U.S. economy.

Brink’s, Incorporated achieved solid revenue and profit growth driven by exceptional performance in a few international subsidiaries. Meanwhile, Brink’s Home Security produced record profits in the quarter by further leveraging its best-in-class business model,” added Mr. Dan.

For the nine months ended September 30, 2004, revenues were $3.42 billion compared with $2.89 billion in the first nine months of 2003. Operating profit for the first nine months was $130.2 million in 2004 compared with $35.6 million in 2003. Net income for the first nine months of 2004 was $82.5 million, or $1.50 per diluted share, compared with $54.4 million, or $1.03 per diluted share, a year ago.

RISKeye mobile technology allows users to monitor closed-circuit television (CCTV), webcams and remote surveillance cameras from

their CellPhone through Openwave’s widely used WAP 2.0 browser,

enabling the application to function on a broad number of

handsets worldwide without the need for client side software

downloads.

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One of the largest advantages of this technology is

the ability to zoom in on specific images or objects without

losing detail in picture quality, thus enabling the user to

pinpoint an object or person in the image frame using a numbered

grid pattern for precision zooming.

Once the object or person is selected on the grid, the image can

then be zoomed in several times for complete detail without sacrificing resolution or picture quality. This can all be done without any additional

software using virtually any CellPhone available on the market

today. For an example of this, please refer to the PowerPoint

presentation on Snocone’s corporate website.

This agreement gives Snocone exclusive, perpetual, worldwide

rights to publish, market, advertise and promote the RISKeye

Mobile Applications. RISKebiz will be contracted by Snocone

Systems to perform system adjustments, upgrades and installations

for the service.

Potential uses of the technology would be for home based webcams

or security camera monitoring, websites that offer streaming

videos to their customers, security and police organizations that

could use the applications in the field by applying CCTV shots or

video feed captures to their CellPhones.

This would enable officers to patrol and view different live camera

images sent straight to their CellPhones while doing patrols. Furthermore,

officers could be sent images of suspects, stolen cars or

kidnapping victims in real-time straight to their mobile device,

helping to improve the response time, information dissemination

and positive ID’s when tracking victims or suspects. Other uses

of the technology could apply to the entertainment industry where

customers currently view streaming video to their computer. Our

technology takes this a step further enabling customers to view

images captured from cameras in real-time, on their CellPhones,

whenever and wherever they want.

In exchange for this exclusive technology, RISKebiz will receive

one million restricted shares of Snocone’s common stock to be

held in escrow for a period of up to two years commencing on the

date of this agreement.

Snocone also announces that Mr. Kevin Day has been appointed

Snocone’s Chief Technology Advisor. This will enable Snocone to

take advantage of Mr. Day’s expertise in various aspects such as

marketing, corporate sales and contracts as well as overseeing

application development for the company’s mobile solutions. Mr.

Day is the President and majority owner of RISKebiz Internet

Services Inc.

• In this address I want to say something about:
  

  – Iraq and terrorism;

  – the global nature of the challenge; and

  – Australia as a terrorist target.

• By way of explanation, I use the term ‘al-Qa’ida’ as a loose descriptor to cover both the organisation itself and other groups acting independently and without central direction, but which share al-Qa’ida’s ideology and are inspired by the likes of Usama bin Laden and his deputy, Ayman al Zawahiri.

Iraq and Terrorism

• Amongst the insurgents in Iraq there are:
  

  – former Saddam Hussein loyalists;

  – other Iraqis with a range of motivations; and

  – non-Iraqis, including militant Islamists, of whom al Zarqawi is the most prominent.

• In respect of al-Qa’ida and Iraq, I think it is accurate to say the following:
  

  – a UN sponsored and peaceful resolution to Iraq in late 2002/early 2003 would have been irrelevant to al-Qa’ida’s intent and purpose

  : it is easy to get so caught up in the debate about Iraq you overlook the fact that al-Qa’ida’s intent and purpose was marked out long before Iraq and long before 9/11, as witnessed by bin Laden’s fatwa in February 1998 in which he declared innocent civilians to be legitimate targets;

  – all the terrorist attacks outside Iraq during and since the war, and committed by al-Qa’ida or groups sharing its ideology, would have occurred with or without the war, and that includes Madrid and the attack on the Australian Embassy in Jakarta on 9 September

  : to the extent Iraq may have been a motivator, when you strip it down, it has been an add-on, not the central driver; and

  – the terrorist leader in Iraq, al Zarqawi, fought in Afghanistan in the late 1980’s and early ’90’s, was imprisoned for terrorism offences in Jordan between 1994-99, had his own training camp in Afghanistan between 1999-2001 and moved between South Asia and the Middle East between 1999-2003. He shares bin Laden’s ideology

  : it would be naive in the extreme to assume, but for Iraq, al Zarqawi would be at peace with the world. For him, Iraq is a convenient killing field. If not Iraq, it would be elsewhere.

• In making these observations I am not suggesting that there have not been any downsides in Iraq in regard to terrorism:
  

  – Iraq has provided al-Qa’ida with propaganda and recruitment opportunities and it only stands to reason that they would have some success;

  – it has provided another self-justification or rationalisation for acts of terrorism;

  – it has increased the threat of terrorism against Australian interests in the Middle East, as was made clear by the Prime Minister in answer to a question in Parliament on 24 March 2003.

• So far, Iraq has not had a significant impact on the security environment here in Australia and there has been no change to the overall threat level in Australia. For the relatively small number of people in Australia who share bin Laden’s ideology, for instance, Iraq is just one more focus. It is possible that some new followers in Australia have been motivated primarily by Iraq, and we cannot exclude the possibility of Iraq being a motivator for some people here in Australia who may want to do harm. Iraq was not a motivator, however, for Willy Brigitte, the Frenchman who was in Australia last year to carry out a terrorist attack.

• Internationally, Iraq has not so far become the cause célèbre that Afghanistan became for many young Muslims worldwide in the 1980’s.

  – the number of non-Iraqis fighting coalition forces is not known, but is estimated to be around 3,000, with most from other Middle Eastern countries

  : some have come from further afield, including from Western Europe and from South Asia, and we would need to be concerned if those numbers became significant. Also, we should not be surprised if the odd one turns up from Australia;

  – but Iraq is well short of the global ‘honeypot’ that was Afghanistan. For instance, it has not yet at least, fired the passions of South East Asian militant Islamists. That could of course change, but we need to be careful in assuming Iraq is a mirror re-run of Afghanistan.

• To what extent those who have gone to fight in Iraq were already committed militant Islamists or to what extent fighting in Iraq has or will turn others, including some Iraqis, into committed militant Islamists, is not known. The only reasonable assumption is that Iraq has added to the number of militant Islamists and will lead to the further development of international linkages between such individuals and groups. That is all something we will need to measure out over time.

• In the context of global terrorism, the real potential downside would be in the US-led Coalition losing its resolve and drifting away. That would embolden militant Islamists globally and could lead to the establishment, in parts of Iraq, of Afghanistan-type safehavens for terrorists, in which training and other re-building could occur unhindered. I say this without making judgement about the Iraq war per se. So, at this stage, we have more to lose if the US-led Coalition gives up, than if it stays with the proper resourcing and commitment.

A Global Challenge

• Iraq has also raised the question of the focus of Australia’s counter-terrorism efforts.

• Every country has finite resources and choices must be made about their allocation and deployment, consistent with the national interest.

• In the context of the current terrorist challenge, it is essential that we make those choices within a global perspective and do not put an artificial intellectual fence around Australia itself or a particular region. It is not a zero-sum equation, with anything done beyond South East Asia being, by definition, at the expense of what can be done within the region.

• Clearly we must be, and are, closely engaged in and with the region. Other things being equal, it should and does come first. It is that part of the world in which we can make a substantial counter-terrorism contribution, consistent with our national interests.

• The two terrorist attacks against Australia so far have been in Indonesia and our interests remain at high threat in the region generally. We have a visibility and a profile in South East Asia beyond what we have elsewhere. Also, Jemaah Islamiyah was certainly developing a presence in Australia and, but for the lead information provided by the Singapore authorities in late 2001, it might have gone undetected for some time.

• But we also need to understand clearly that Australia is a global target. Our interests are at high threat elsewhere, especially in South Asia and in the Middle East. And, while not the target of first choice, there have been credible threats against our interests beyond South East Asia and our interests could be attacked anywhere.

• Since 9/11 ASIO has sought to identify Australians world-wide connected to terrorism. That work has taken us from Indonesia to inside the Arctic Circle and to all continents but the Antarctic. It is work which continues to this day.

• Look at Willy Brigitte; born in the Caribbean, introduced to militant Islam in France, trained as a terrorist in Pakistan, Brigitte came to Australia to carry out a terrorist attack. And, but for the cooperative work of the French authorities, ASIO, the AFP and the NSW Police, he may have succeeded.

• Overwhelmingly, those people in Australia who have undertaken terrorist training have done so beyond South East Asia. Also, their continuing links and motivations come from beyond the region.

• Of the Australians so far who have been convicted of terrorism offences or who are facing terrorism charges only one has a connection to South East Asia:

  – and that is the first Australian recently convicted of terrorism offences, Jack Roche, a British migrant trained in Afghanistan by al-Qa’ida and connected to Jemaah Islamiyah;

  – of the four Australians awaiting trial in Sydney for terrorism offences, two are Australians of Pakistani origin, one is an Australian of Lebanese origin and one was born in Australia of Lebanese background;

  – one Australian was recently released from custody in Lebanon after serving a short sentence for terrorism offences and another Australian is awaiting trial in Lebanon on terrorism offences;

  – one Australian from China is in custody in Kazakhstan since being convicted in 2001 of a terrorism offence; and

  – two Australians are in Guantanamo Bay awaiting trial before a United States Military Commission – one born in Australia of Caucasian parents and one of Egyptian origin.

• So while South East Asia ought to be our priority, it should be:
  

  – within a global perspective;

  – within a framework which recognises the terrorist linkages and threats beyond the region; and

  – within a framework which is sufficiently flexible to accommodate involvement beyond South East Asia in recognition of the fact that, when it comes to terrorism, our national interests can be engaged almost anywhere.

• Certainly, ASIO could not properly fulfil its responsibilities under legislation, if we saw our job primarily limited to Australia and South East Asia. Rather, we must go where our responsibilities take us.

Australia and Terrorism

• The debate about Australia’s involvement in Iraq has also, at times, clouded the issue of when Australia became an al-Qa’ida target and for what reason.

• Before 11 September 2001, ASIO had already identified a small number of Australians who had trained in Afghanistan and others with some connection to al-Qa’ida

  – ASIO’s 1999-2000 Annual Report to Parliament – the public version of our classified report to Government, which is also provided to the Leader of the Opposition – stated that “there are militant groups internationally which view terrorism as a legitimate means of pursuing their cause. Some are sufficiently well-resourced to view the whole world as their theatre of operations. Some have a small number of supporters in Australia”. The Report also referred to “the threat of terrorist activity by associates of Usama bin Laden and other groups”.

• Before 11 September 2001, ASIO’s broad assessment was that:
  

  – despite bin Laden’s threats against the United States and “its allies”, there were no indicators that Australia was a priority target, either here at home or our interests abroad; and

  – any attack within Australia would most likely be directed against United States and/or Israeli interests.

• Following 11 September 2001, ASIO raised formal threat levels in Australia, and raised to High the threat to Australian interests in Indonesia
  

  – in particular, we considered significant bin Laden’s statement of 3 November 2001 in which he explicitly legitimatised Australia as a target for the first time.

• The extent to which Australia was considered a target well before 9/11, however, only became evident subsequently:
  

  – in late 2001 Singapore uncovered the plot by Jemaah Islamiyah to attack mainly US interests there, but also including the Australian High Commission;

  – the JI investigation in Australia led to Jack Roche and the identification of the aborted plot to attack Israeli diplomatic interests here in 2000;

  – a raid in Pakistan in late 2002 uncovered details of the casing, before 9/11, of a number of airports, including one in Australia

  : this does not mean that there was an actual plan to attack the Australian airport, but that consideration of an attack here was within al-Qa’ida’s strategic vision;

  – during 2002 we were able to establish that al-Qa’ida’s chief operational planner, Khalid Shaikh Mohammed, had been issued with an Australian visa in August 2001. The visa, which was applied for by Khalid using a then unknown alias, had not been utilised and was cancelled

  : the only reasonable assumption is that Khalid was planning to come to Australia for some operational purpose;

  – from the debriefing of captured senior al-Qa’ida figures in 2002 and 2003 we know that attacks in Australia, over and above the ones I have already mentioned, were actively canvassed well before 9/11; and

  – finally, in the context of the extent to which Australia was and is considered a target, we had actual attacks in Bali in October 2002 and in Jakarta in September 2004.

• The obvious question is, why are we a target?

• One possibility is simply to take at face value what terrorists like bin Laden and al Zawahiri say. In which case we are a target because of our alliance with the United States, and because of our involvement in East Timor in 1999, Afghanistan in 2001-02 and Iraq since early 2003.

• While, I believe, we should take seriously any statement by al-Qa’ida leaders declaring particular countries to be targets, their claims as to why, are puzzling, except if you interpret their claims as being directed, not at their enemies but at their followers or potential followers.

• In this context, I think bin Laden’s first known reference to East Timor in November 2001 was designed to strike a chord in South East Asia, especially Indonesia, and his subsequent references to Afghanistan and Iraq must be seen in terms of al-Qa’ida propaganda and recruitment purposes. That is not to diminish the significance of his references to East Timor, Afghanistan and Iraq, but to question whether our involvement in those countries is the central driver in al-Qa’ida’s targeting of Australia. Otherwise, how do you explain al-Qa’ida’s very real interest in Australia, and the targeting of us, before our involvement in those countries. It simply does not make sense.

• Perhaps then, we are a target because of our alliance with the United States. As I have stated previously, the fact that we are in close alliance with the Untied States does contribute to us being a target:

  – that is very different to any claim that we are a target solely because of our alliance with the United States;

  – but even if we were a target only because of our alliance with the United States, on what basis would any self respecting country allow terrorists to determine such central policies, in this case one which has had bi-partisan support for over 50 years?

• And as Kenya and Indonesia know, you do not need to be in alliance with the United States for your citizens to be murdered by the likes of al-Qa’ida and Jemaah Islamiyah.

• So if East Timor, Afghanistan, Iraq and our alliance with the United States are, to varying degrees, only contributors or add-ons, what is it that lies at the centre of those who provide the intellectual and strategic drive which leads to us being a target?

• I believe the answer lies in the world view of terrorist leaders such as Usama bin Laden, al Zawahiri, al Zarqawi and Abu Bakar Bashir. A world view shaped and driven by a militant, literal interpretation of the Koran. A world view which seeks to hijack one the world’s great religions. A world view which predates the Afghanistan of the 1980’s, which reaches back to the teachings and ideologies of Sayyid Qutb, a leading figure in the Muslim Brotherhood in Egypt in the 1950’s and early ’60’s, and which reaches back many centuries before that.

• It is a world view in which we and others are seen as part of a Jewish-Christian conspiracy, a world view in which the United Nations and its Secretary-General are declared enemies and legitimate targets, and a world view in which Muslim countries ruled by other than Taliban style governments are declared enemies and legitimate targets.

• It is a world view so removed from our own values, traditions and experiences that it is tempting to dismiss it as empty, meaningless rhetoric and so unreal as not to be taken seriously. It is so much easier to explain the challenge in terms of root causes such as poverty, or in terms of our own failures. Such explanations have a familiar shape and give us something concrete to address within a somewhat comforting framework. It gives us a sense of some control, a sense that, if only we can get our side of it right, it will go away. So much more confronting to be challenged by leaders who have a totally different frame of reference, who are playing a different game on a different playing field.

• I appreciate that my perspective is but one, and that some scholars and terrorist experts would disagree. I also acknowledge that the resolution of issues, such as Palestine, would deny al-Qa’ida some significant oxygen and is an important goal, provided we do not fall into the trap of seeing al-Qa’ida merely as an outgrowth of the Palestinian issue.

• Nor am I seeking to pretend that our involvement, in Afghanistan for instance, is irrelevant. As noted by the then Attorney-General, Daryl Williams, in the House of Representatives on 17 September 2001, ‘we must be acutely aware that our own active involvement in the fight (against terrorism) could well bring terrorism closer to our own shores’.

• In my view we have no alternative but to continue to meet the challenge of al-Qa’ida and groups such as Jemaah Islamiyah, with their world view which allows for no compromise or conciliation. People such as Abu Bakar Bashir are terrorists masquerading as good muslims, who seek to hide their hatred in the language of the pious. Read, for instance, Bashir’s interview with The Bulletin magazine of 21 September 2004.

• In summary, I would leave you with the following points:

  – Iraq is not the starting point for terrorism;

  – the terrorism connections into Australia are global and the challenge is global. Our regional counter-terrorism priorities should continue to be managed within a global context; and

  – the world view at the centre of al-Qa’ida and groups such as Jemaah Islamiyah explain why we are a target and is the key to understanding why the challenge will be with us for a long time.