The government took steps to thwart the plot, but was plagued by communications problems, the commission found.
In the prelude to the attacks on Washington and New York, "the intelligence reporting consistently described the upcoming attacks as occurring on a catastrophic level, indicating that they would cause the world to be in turmoil, consisting of possible multiple—but not necessarily simultaneous—attacks," the commission probing Sept. 11 found.
The preliminary report was one of two released as the commission began two days of hearings on law enforcement reaction to terrorist threats before the 2001 attacks.
FBI Director Louis Freeh and former Attorney General Janet Reno testified in the morning session. Thomas Pickard, who served as acting FBI director in the months just before the attacks, and former CIA counterterrorism center director Cofer Black followed. Attorney General John Ashcroft was due to testify later.
"I'm here today to tell the American people what we did, what we tried to do and where we fell short," Black said.
Meanwhile, a source tells CBS News that the CIA analyst who wrote the August 6, 2001 memo to President Bush about terrorist threats was interviewed by the commission Monday evening.
The alarming threat reports began in March 2001, increased in April and May and surged in June and July, with headlines like "Bin Ladin threats are real," and "Bin Ladin planning high profile attacks."
Because of the threats, the U.S. redeployed its 5th fleet and put troops on alert in six countries. Officials like Vice President Dick Cheney contacted foreign governments for help. Some foreign authorities detained suspected militants.
But alarm over the threats, and some key intelligence, did not circulate through the entire national security apparatus.
"In late August, working-level CIA and FBI officials realized that one or more al Qaeda operatives might be in the United States," the report found. But there is no evidence that their suspicions were on to the national Counterterrorism and Security Group that Richard Clarke headed or to top CIA or FBI officials. The White House was not told about the arrest of Zacarias Moussaoui, who was taking flight lessons.
And agents at some FBI field offices "did not recall a heightened sense of threat from al Qaeda within the United States in summer 2001." Pickard told the commission he did not know why field offices did not comply with his order to be on alert.
Pickard said he passed the threats onto Ashcroft, but "after two such briefings the attorney general told him he did not want to hear this information anymore." The Justice Department denies Ashcroft ever said that.
Communication problems were identified in another report released Tuesday on the FBI. It found that terrorism investigations were run largely out of regional offices, which made it hard to detect broad terror plots. Budget and training problems created a shortage of trained counterterrorism officers.
"On September 11, 2001, the FBI was limited in several areas critical to an effective, preventive counterterrorism strategy," the report concluded. "Those working counterterrorism matters did so despite limited intelligence collection and strategic analysis capabilities, a limited capacity to share information both internally and externally, insufficient training, an overly complex legal regime, and inadequate resources."
The report found that the FBI's counterterrorism strategy "was not a focus of the Justice Department in 2001." The Bush administration proposed a major increase in FBI funding, but an internal budget plan from early 2001 "made reducing the incidence of gun violence and reducing the trafficking of illegal drugs priority objectives."
The bureau's counterterrorism chief, Dale Watson, told the commission "that he almost fell out of his chair when he saw the memo, because it made no mention of counterterrorism." On the day before the 2001 attacks, Ashcroft rejected a request for more counterterrorism funding.
Agents were reluctant to write investigative findings down because the documents could be used be defense lawyers to undermine criminal cases. They felt bound by legal guidelines, especially "the wall" — a legal separation of criminal and intelligence investigations.
In his testimony, Freeh defended his former agency's performance, saying that the environment before Sept. 11 would not have allowed the bureau to do more.
"The point is not that any FBI agent thought that investigating these cases was the best way" of fighting terrorism, Freeh said. "The point of these investigations was, in the absence of invading Afghanistan, in the absence of armed Predator missiles, in the absence of all the things that were done after Sept. 11 … we were left with alternatives that were netter than no alternatives."
Pickard said prior to Sept. 11, al Qaeda camps were turning out five times as many graduates as the FBI or CIA academies. The hijackers were selected precisely because they could enter the United States without detection. They did little to arouse suspicion, avoiding meetings with known al Qaeda operatives, for example.
"They successfully exploited every weakness, from our borders to our cockpit doors," Pickard said of the hijackers.
The Aug. 6, 2001 presidential brief referred to 70 FBI investigations into suspected terrorists. Pickard said that number differs from the accurate figured, which is still classified.
Efforts to thwart al Qaeda took a long-term view, Black said, and hoped to delay an attack until more intelligence was gathered. He said the current war on terrorism will also be a long-term effort.
"As long as there are people who are unhappy with their lot in life" and as long as the United States can be blamed for it, "there will be terrorism," he said.