[News] Israeli Spying in the United States

Anti-Imperialist News news at freedomarchives.org
Thu Mar 12 11:45:48 EDT 2009


http://www.counterpunch.org/ketcham03122009.html

March 12 , 2009


Full-Spectrum Penetration

Israeli Spying in the United States

By CHRISTOPHER KETCHAM

Scratch a counterintelligence officer in the U.S. 
government and they'll tell you that Israel is 
not a friend to the United States.
This is because Israel runs one of the most 
aggressive and damaging espionage networks targeting the U.S..

The fact of Israeli penetration into the country 
is not a subject oft-discussed in the media or in 
the circles of governance, due to the extreme 
sensitivity of the U.S.-Israel relationship 
coupled with the burden of the Israel lobby, 
which punishes legislators who dare to criticize 
the Jewish state.  The void where the facts 
should sit is filled instead with the 
hallucinations of conspiracy theory -- the kind 
in which, for example, agents of the Mossad, 
Israel’s top intelligence agency, engineer the 
9/11 attacks, while 4,000 Israelis in the Twin 
Towers somehow all get word to escape before the 
planes hit.  The effect, as disturbing as it is 
ironic, is that the less the truth is addressed, 
the more noxious the falsity that spreads.

Israel's spying on the U.S., however, is a matter 
of public record, and neither conspiracy nor 
theory is needed to present the evidence.   When 
the FBI produces its annual report to Congress 
concerning "Foreign Economic Collection and 
Industrial Espionage," Israel and its 
intelligence services often feature prominently 
as a threat second only to China. In 2005 the FBI 
noted, for example, that Israel maintains "an 
active program to gather proprietary information 
within the United States."  A key Israeli method, 
said the FBI report, is computer intrusion.  In 
1996, the Defense Intelligence Service, a branch 
of the Pentagon, issued a warning that "the 
collection of scientific intelligence in the 
United States [is] the third highest priority of 
Israeli Intelligence after information on its 
Arab neighbors and information on secret U.S. 
policies or decisions relating to Israel."

In 1979, the Central Intelligence Agency produced 
a scathing survey of Israeli intelligence 
activities that targeted the U.S. 
government.  Like any worthy spy service, Israeli 
intelligence early on employed wiretaps as an 
effective tool, according to the CIA report.  In 
1954, the U.S. Ambassador in Tel Aviv discovered 
in his office a hidden microphone "planted by the 
Israelis," and two years later telephone taps 
were found in the residence of the U.S. military 
attaché.  In a telegram to Washington, the 
ambassador at the time cabled a warning: 
"Department must assume that all conversations 
[in] my office are known to the Israelis." The 
former ambassador to Qatar, Andrew Killgore, who 
also served as a foreign officer in Jerusalem and 
Beirut, told me Israeli taps of U.S. missions and 
embassies in the Middle East were part of a "standard operating procedure."

According to the 1979 CIA report, the Israelis, 
while targeting political secrets, also devote "a 
considerable portion of their covert operations 
to obtaining scientific and technical 
intelligence." These operations involved, among 
other machinations, "attempts to penetrate 
certain classified defense projects in the United 
States."   The penetrations, according to the CIA 
report, were effected using "deep cover 
enterprises," which the report described as 
"firms and organizations, some specifically 
created for, or adaptable to, a specific 
objective."  At the time, the CIA singled out 
government-subsidized companies such as El Al 
airlines and Zim, the Israeli shipping firm, as deep cover enterprises.

Other deep cover operations included the 
penetration of a U.S. company that provided 
weapons-grade uranium to the Department of 
Defense during the 1960s; Israeli agents 
eventually spirited home an estimated 200 pounds 
of uranium as the bulwark in Israel’s secret 
nuclear weapons program.  Moles have burrowed on 
Israel’s behalf throughout the U.S. intelligence 
services.  Perhaps most infamous was the case of 
Jonathan Pollard, a Jewish-American employed as a 
civilian analyst with the U.S. Navy who purloined 
an estimated 800,000 code-word protected 
documents from inside the CIA, the Defense 
Intelligence Agency, and numerous other U.S. agencies.

While Pollard was sentenced to life in prison, 
counterintelligence investigators at the FBI 
suspected he was linked to a mole far higher in 
the food chain, ensconced somewhere in the DIA, 
but this suspected Israeli operative, nicknamed 
"Mr. X," was never found.   Following the 
embarrassment of the Pollard affair -- and its 
devastating effects on U.S. national security, as 
testified by then Defense Secretary Caspar 
Weinberger (who allegedly stated that Pollard 
"should have been shot") -- the Israeli 
government vowed never again to pursue espionage 
against its ally and chief benefactor.

Fast-forward a quarter century, and the vow has 
proven empty.  In 2004, the authoritative Jane's 
Intelligence Group noted that Israel's 
intelligence organizations "have been spying on 
the U.S. and running clandestine operations since 
Israel was established."  The former deputy 
director of counterintelligence at FBI, Harry B. 
Brandon, last year told Congressional Quarterly 
magazine that "the Israelis are interested in 
commercial as much as military secrets. They have 
a muscular technology sector 
themselves."  According to CQ, "One effective 
espionage tool is forming joint partnerships with 
U.S. companies to supply software and other 
technology products to U.S. government agencies."

Best-selling author James Bamford now adds 
another twist in this history of infiltration in 
a book published last October, 
"<http://www.amazon.com/exec/obidos/ASIN/0385521324/counterpunchmaga>The 
Shadow Factory," which forms the latest 
installment in his trilogy of investigations into 
the super-secret National Security 
Agency.  Bamford is regarded among journalists 
and intelligence officers as the nation’s expert 
on the workings of the NSA, whose inner sanctums 
he first exposed to the public in 1982. (So 
precise is his reporting that NSA officers once 
threw him a book party, despite the fact that he 
continually reveals their secrets.)

The agency has come a long way in the 
half-century since its founding in 1952.  Armed 
with digital technology and handed vast new 
funding and an almost limitless mandate in the 
wake of the 9/11 attacks, Bamford writes, the NSA 
has today "become the largest, most costly, and 
most technologically sophisticated spy 
organization the world has ever known."  The NSA 
touches on every facet of U.S. communications, 
its mega-computers secretly filtering "millions 
of phone calls and e-mails" every hour of 
operation.  For those who have followed the 
revelations of the NSA’s "warrantless 
wiretapping" program in the 
<http://www.nytimes.com/2005/12/16/politics/16program.htm>New 
York Times in 2005 and the 
<http://online.wsj.com/article/SB120511973377523845.html?mod=hps_us_whats_news%E2%80%9D>Wall 
Street 
Journal<http://online.wsj.com/article/SB120511973377523845.html?mod=hps_us_whats_news%E2%80%9D> 
last year, what Bamford unveils in "The Shadow 
Factory" is only confirmation of the worst fears: 
"There is now the capacity," he writes of the 
NSA’s tentacular reach into the private lives of 
Americans, "to make tyranny total."

Much less has been reported about the high-tech 
Israeli wiretapping firms that service U.S. 
telecommunications companies, primarily AT&T and 
Verizon, whose networks serve as the chief 
conduits for NSA surveillance.  Even less is 
known about the links between those Israeli 
companies and the Israeli intelligence 
services.  But what Bamford suggests in his book 
accords with the history of Israeli spying in the 
U.S.: Through joint partnerships with U.S. 
telecoms, Israel may be a shadow arm of 
surveillance among the tentacles of the NSA.  In 
other words, when the NSA violates constitutional 
protections against unlawful search and seizure 
to vacuum up the contents of your telephone 
conversations and e-mail traffic, the Israeli 
intelligence services may be gathering it up too 
-- a kind of mirror tap that is effectively a two-government-in-one violation.

***

On its face, the overseas outsourcing of 
high-tech services would seem de rigueur in a 
competitive globalized marketplace.  Equipment 
and services from Israel’s telecom sector are 
among the country’s prime exports, courtesy of 
Israeli entrepreneurs who have helped pioneer 
wireless telephony, voicemail and voice 
recognition software, instant messaging, phone 
billing software, and, not least, "communications 
interception solutions."  Israeli telecom 
interception hardware and software is appraised 
as some of the best in the world.

By the mid-1990s, Israeli wiretap firms would 
arrive in the U.S. in a big way.  The key to the 
kingdom was the 1994 Communications Assistance 
for Law Enforcement Act (CALEA), which was 
Congress’ solution for wiretapping in the digital 
age.   Gone are the days when wiretaps were 
conducted through on-site tinkering with copper 
switches.  CALEA mandated that telephonic 
surveillance operate through computers linked 
directly into the routers and hubs of telecom 
companies -- a spyware apparatus matched in 
real-time, all the time, to American telephones 
and modems.  CALEA effectively made spy equipment 
an inextricable ligature in telephonic 
life.  Without CALEA, the NSA in its spectacular 
surveillance exploits could not have succeeded.

AT&T and Verizon, which together manage as much 
as 90 percent of the nation’s communications 
traffic, contracted with Israeli firms in order 
to comply with CALEA.  AT&T employed the services 
of Narus Inc., which was founded in Israel in 
1997.  It was Narus technology that AT&T 
whistleblower Mark Klein, a 22-year technician 
with the company, famously unveiled in a 2006 
affidavit that described the operations in AT&T’s 
secret tapping room at its San Francisco 
facilities.  (Klein’s affidavit formed the 
gravamen of a lawsuit against AT&T mounted by the 
Electronic Freedom Foundation, but the lawsuit 
died when Congress passed the telecom immunity 
bill last year.)  According to Klein, the Narus 
supercomputer, the STA 6400, was "known to be 
used particularly by government intelligence 
agencies because of its ability to sift through 
large amounts of data looking for preprogrammed 
targets."  The Narus system, which was maintained 
by Narus technicans, also provided a real-time 
mirror image of all data streaming through AT&T 
routers, an image to be rerouted into the computers of the NSA.

According to Jim Bamford, who cites knowledgeable 
sources, Verizon’s eavesdropping program is run 
by a competing Israeli firm called Verint, a 
subsidiary of Comverse Technology, which was 
founded by a former Israeli intelligence officer 
in 1984.  Incorporated in New York and Tel Aviv, 
Comverse is effectively an arm of the Israeli 
government: 50 percent of its R&D costs are 
reimbursed by the Israeli Ministry of Industry 
and Trade.  The Verint technology deployed 
throughout Verizon’s network, known as STAR-GATE, 
boasts an array of Orwellian capabilities.  "With 
STAR-GATE, service providers can access 
communications on virtually any type of network," 
according to the company’s literature.  "Designed 
to manage vast numbers of targets, concurrent 
sessions, call data records, and communications, 
STAR-GATE transparently accesses targeted 
communications without alerting subscribers or disrupting service."

As with the Narus system, the point is to be able 
to tap into communications unobtrusively, in real 
time, all the time.  A Verint spinoff firm, 
PerSay, takes the tap to the next stage, 
deploying "advanced voice mining," which singles 
out "a target’s voice within a large volume of 
intercepted calls, regardless of the conversation 
content or method of communication."  Verint’s 
interception systems have gone global since the 
late 1990s, and sales in 2006 reached $374 
million (a doubling of its revenues over 
2003).  More than 5,000 organizations -- mostly 
intelligence services and police units -- in at 
least 100 countries today use Verint technology.

What troubles Bamford is that executives and 
directors at companies like Narus and Verint 
formerly worked at or maintain close connections 
with the Israeli intelligence services, including 
Mossad; the internal security agency Shin Bet; 
and the Israeli version of the NSA, Unit 8200, an 
arm of the Israeli Defense Forces Intelligence 
Corps.  Unit 8200, which Bamford describes as 
"hypersecret," is a key player in the 
eavesdropping industrial complex in Israel, its 
retired personnel dispersed throughout dozens of 
companies.  According to Ha’aretz, the Israeli 
daily, "Many of the [eavesdropping] technologies 
in use around the world and developed in Israel 
were originally military technologies and were 
developed and improved by [Unit 8200] 
veterans."  A former commander of Unit 8200, 
cited by Bamford, states that Verint technology 
was "directly influenced by 8200 
technology
.[Verint parent company] Comverse’s 
main product, the Logger, is based on the Unit’s technology."

The implications for U.S. national security, 
writes Bamford, are "unnerving."  "Virtually the 
entire American telecommunications system," he 
avers, "is bugged by [Israeli-formed] companies 
with possible ties to Israel’s eavesdropping 
agency."  Congress, he says, maintains no 
oversight of these companies’ operations, and 
even their contracts with U.S. telecoms -- 
contracts pivotal to NSA surveillance -- are 
considered trade secrets and go undisclosed in company statements.

U.S. intelligence officers have not been quiet in 
their concerns about Verint (I reported on this 
matter in 
<http://www.counterpunch.org/ketcham09272008.html>CounterPunch.org 
last September).  "Phone calls are intercepted, 
recorded, and transmitted to U.S. investigators 
by Verint, which claims that it has to be ‘hands 
on’ with its equipment to maintain the system," 
says former CIA counterterrorism officer Philip 
Giraldi.  The "hands on" factor is what bothers 
Giraldi, specifically because of the possibility 
of a "trojan" embedded in Verint wiretap 
software.   A trojan in information security 
hardware/software is a backdoor that can be 
accessed remotely by parties who normally would 
not have access to the secure system.

Allegations of widespread trojan spying have 
rocked the Israeli business community in recent 
years.  "Top Israeli blue chip companies," 
reported the AP in 2005, "are suspected of using 
illicit surveillance software to steal 
information from their rivals and enemies."  Over 
40 companies have come under scrutiny.  "It is 
the largest cybercrime case in Israeli history," 
Boaz Guttmann, a veteran cybercrimes investigator 
with the Israeli national police, told 
me.  "Trojan horse espionage is part of the way 
of life of companies in Israel.  It’s a culture of spying."

In a wide-ranging four-part investigation into 
Israel-linked espionage that aired in December 
2001, Carl Cameron, a correspondent at Fox News 
Channel, reported the distress among U.S. 
intelligence officials warning about possible 
trojans cached in Verint technology.   Sources 
told Cameron that "while various FBI inquiries 
into [Verint] have been conducted over the 
years," the inquiries had "been halted before the 
actual equipment has ever been thoroughly tested 
for leaks."   Cameron also cited a 1999 internal 
FCC document indicating that "several government 
agencies expressed deep concerns that too many 
unauthorized non-law enforcement personnel can 
access the wiretap system."   Much of this access 
was facilitated through "remote maintenance."

The Fox News report reverberated throughout U.S. 
law enforcement, particularly at the Drug 
Enforcement Agency, which makes extensive use of 
wiretaps for narcotics interdiction. Security 
officers at DEA, an adjunct of the Justice 
Department, began examining the agency’s own 
relationship with Comverse/Verint.  In 1997, DEA 
had transformed its wiretap infrastructure with 
the $25 million procurement from Comverse/Verint 
of a technology called "T2S2" -- "translation and 
transcription support services" -- with 
Comverse/Verint contracted to provide the 
hardware and software.  The company was also 
tasked with "support services, training, 
upgrades, enhancements and options throughout the 
life of the contract," according to the DEA’s 
"contracts and acquisitions" notice.  In the wake 
of the Fox News investigation, however, the 
director of security programs at DEA, Heidi 
Raffanello, was rattled enough to issue an 
internal communiqué on the matter, dated Dec. 18, 
2001.  Directly referencing Fox News, she worried 
that "Comverse remote maintenance" was "not 
addressed in the C&A [contracts and acquisitions] 
process
.It remains unclear if Comverse personnel 
are security cleared, and if so, who are they and 
what type of clearances are on record
.Bottom 
line we should have caught it."  It is not known 
what resulted from DEA’s review of the issue of 
remote maintenance and access by Comverse/Verint.

Bamford devotes a portion of his argument to the 
detailing of the operations of a third Israeli 
wiretap company, NICE Systems, which he describes 
as "a major eavesdropper in the U.S." that "keeps 
its government and commercial client list very 
secret."  Formed in 1986 by seven veterans of 
Unit 8200, NICE software "captures voice, email, 
chat, screen activity, and essential call 
details," while offering "audio compression 
technology that performs continuous recordings of 
up to thousands of analog and digital telephone 
lines and radio channels."  NICE Systems has on 
at least one occasion shown up on the radar of 
U.S. counterintelligence.  During 2000-2001, when 
agents at the FBI and the CIA 
began  investigating allegations that Israeli 
nationals posing as "art students" were in fact 
conducting espionage on U.S. soil, one of the 
Israeli "art students" was discovered to be an 
employee with NICE Systems.  Among the targets of 
the art students were facilities and offices of 
the Drug Enforcement Agency nationwide. The same 
Israeli employee of NICE Systems, who was 
identified as a former operative in the Israeli 
intelligence services, was carrying a disk that 
contained a file labeled "DEA Groups."  U.S. 
counterintelligence officers concluded it was a 
highly suspicious nexus: An Israeli national and 
alleged spy was working for an Israeli wiretap 
company while carrying in his possession computer 
information regarding the Drug Enforcement Agency 
-- at the same time this Israeli was conducting 
what the DEA described as "intelligence gathering" about DEA facilities.

***

A former senior counterintelligence official in 
the Bush administration told me that as early as 
1999, "CIA was very concerned about [Israeli 
wiretapping companies]" -- Verint in 
particular.  "I know that CIA has tried to 
monitor what the Israelis were doing -- 
technically watch what they were doing on the 
networks in terms of remote access.  Other 
countries were concerned as well," said the 
intelligence official.  Jim Bamford, who notes 
that Verint "can automatically access the 
mega-terabytes of stored and real-time data 
secretly and remotely from anywhere," reports 
that Australian lawmakers in 2004 held hearings 
on this remote monitoring capability. "[Y]ou can 
access data from overseas," the lawmakers told a 
Verint representative during the hearings, "but 
[the legislature] seems restricted to access data 
within that system."  The Australians found this astonishing.

In 2000, the Canadian intelligence service, the 
Royal Canadian Mounted Police, conducted "a probe 
related to allegations that [Israeli] spies used 
rigged software to hack into Canada's top secret 
intelligence files," according to an article in 
the Toronto Star.  Several sources in the U.S. 
intelligence community told me the Canadians 
liaised with their American counterparts to try to understand the problem.

According to the Bush administration official who 
spoke with me, "the Dutch also had come to the 
CIA very concerned about what the Israelis were 
doing with this."  The Dutch intelligence 
service, under contract with Verint, "had 
discovered strange things were going on -- there 
was activity on the network, the Israelis 
uploading and downloading stuff out of the 
switches, remotely, and apparently using it for 
their own wiretap purposes.  The CIA was very 
embarrassed to say, ‘We have the same 
problem.’  But the CIA didn’t have an answer for 
them.  ‘We hear you, we’re surprised, and we understand your concern.’"

Indeed, sources in the Dutch counterintelligence 
community in 2002 claimed there was "strong 
evidence that the Israeli secret service has 
uncontrolled access to confidential tapping data 
collected by the Dutch police and intelligence 
services," according to the Dutch broadcast radio 
station Evangelische Omroep (EO). In January 
2003, the respected Dutch technology and 
computing magazine, C’T, ran a follow-up to the 
EO story, headlined "Dutch Tapping Room not 
Kosher." The article states: "All tapping 
equipment of the Dutch intelligence services and 
half the tapping equipment of the national police 
force [is] insecure and is leaking information to Israel."

"The key to this whole thing is that Australian 
meeting," Bamford told me in a recent interview. 
"They accused Verint of remote access and Verint 
said they won’t do it again -- which implies they 
were doing it in the past.  It’s a matter of a 
backdoor into the system, and those backdoors 
should not be allowed to exist.  You can tell by 
the Australian example that it was certainly a 
concern of Australian lawmakers."

Congress doesn’t seem to share the 
concern.  "Part of the responsibility of 
Congress," says Bamford, "is not just to oversee 
the intelligence community but to look into the 
companies with which the intelligence community 
contracts.  They’re just very sloppy about 
this."  According to the Bush administration 
intelligence official who spoke with me, 
"Frustratingly, I did not get the sense that our 
government was stepping up to this and grasping 
the bull by the horns."  Another former high 
level U.S. intelligence official told me, "The 
fact of the vulnerability of our telecom backbone 
is indisputable.  How it came to pass, why 
nothing has been done, who has done what -- these 
are the incendiary questions."  There is also the 
fundamental fact that the wiretap technologies 
implemented by Verint, Narus and other Israeli 
companies are fully in place and no alternative 
is on the horizon.  "There is a technical path 
dependence problem," says the Bush administration 
official. "I have been told nobody else makes 
software like this for the big digital switches, 
so that is part of the problem.  Other issues," 
he adds, "compound the problem" -- referring to 
the sensitivity of the U.S.-Israel relationship.

And that, of course, is the elephant in the 
room.  "Whether it’s a Democratic or Republican 
administration, you don’t bad-mouth Israel if you 
want to get ahead," says former CIA 
counterterrorism officer Philip Giraldi.  "Most 
of the people in the agency were very concerned 
about Israeli espionage and Israeli actions 
against U.S. interests. Everybody was aware of 
it.  Everybody hated it.  But they wouldn’t get 
promoted if they spoke out.  Israel has a 
privileged position and that’s the way things 
are.  It’s crazy.  And everybody knows it’s crazy."

Christopher Ketcham is working on a book about 
the dissolution of the United States and its 
replacement by bioregional republics.  He can be 
reached at <mailto:cketcham99 at mindspring.com>cketcham99 at mindspring.com

This article originally appeared on <http://www.alternet.org/>Alternet.




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