German spy chief warns against Chinese investment in German hi-tech firms

Hans-Georg MaassenThe head of Germany’s domestic intelligence agency has warned of security risks resulting from Chinese direct investment in high-technology German and other European companies. Since 2012, Hans-Georg Maassen has served as director of the Federal Office for the Protection of the Constitution, Germany’s domestic security and counterintelligence agency. Speaking to reporters on Wednesday, Maassen said his agency had noticed an inverse correlation between cyber-espionage attacks on Germany by Chinese actors and the acquisition of German technology firms by Chinese companies. German counter-intelligence officials were puzzled, he said, about a dramatic reduction in Chinese cyber-espionage activities in 2016. But they eventually realized that cyber-espionage operations had been replaced by “lawful methods”, he said, such as direct takeovers of German hi-tech firms by Chinese companies.

The purpose of these takeovers was “to gain access to German technical know-how”, added Maassen. He went on to say that “industrial cyberespionage is no longer needed if an actor can simply exploit liberal economic regulations to buy companies, and then proceed to disembowel them, essentially cannibalize them, to gain access to their know-how”. The spy chief noted that Germany did not object to foreign investment and the free flow of capital from all countries, including China. However, he added, “certain direct investments in specific technologies can compromise domestic security”. Maassen mentioned several examples in his presentation, including the takeover of Kuka, a German robotics firm, by a Chinese investor in 2016. He said that in the past few months alone, Chinese companies have attempted to purchase stakes in 50Hertz, a German energy grid operator, German car manufacturer Daimler, and Cotesa, a German aerospace contractor.

In response to a question from a journalist about policy coordination between Germany and the European Union, Maassen said that Germany, France and Italy have been pressuring Brussels to update and modernize its screening procedures against foreign takeovers of companies that are involved in manufacturing and selling “sensitive technologies”. He noted that a new EU-wide screening mechanism should be in place by the end of 2018.

Author: Joseph Fitsanakis | Date: 12 April 2018 | Permalink

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Britain looking to resettle poisoned Russian spy to the United States, says source

Sergei SkripalThe British government may relocate Sergei Skripal, the Russian double spy who appears to have survived an assassination attempt in England, to the United States, in an effort to protect him from further attacks. The BBC reported last week that Skripal, who had been in a critical condition for nearly a month, was “improving rapidly”. Skripal, 66, who spied for Britain in the early 2000s, and has been living in England since 2010, was poisoned with what London claims was a military-grade nerve agent. Nearly every European country, as well as Canada, Australia and the United States, expelled Russian diplomats in response to the attack on the Russian former spy. His daughter, Yulia, who is 33, also came down with nerve-agent poisoning on the same day as her father, but appears to have survived.

The London-based newspaper The Sunday Times said yesterday that British government officials are exploring the possibility of resettling Skripal and his daughter in an allied country. The paper claimed that the countries being considered for possible relocation belong to the so-called “Five Eyes” agreement (also known as UKUSA), a decades-old pact between intelligence agencies from Australia, New Zealand, Britain, Canada and the United States. The Times quoted “an intelligence source” familiar with the negotiations allegedly taking place between the British government and its UKUSA partners. The source reportedly told the paper that the Skripals “will be offered new identities”, but did not elaborate on how they would avoid attention after their images were published by every major media outlet in the world following last month’s incident in England.

The anonymous source told The Times that “the obvious place to resettle [the two Russians] is America because they are less likely to be killed there and it is easier to protect them there under a new identity”. The paper also reported that Britain’s Secret Intelligence Service, also known as MI6, is holding discussions with its American counterpart, the Central Intelligence Agency, about resettling the Skripals on American soil. But an article published on Sunday in another British newspaper, The Daily Telegraph, said that senior government officials in the United States are now worried that Russian defectors and former spies living there may not be safe. The paper quoted an unnamed “senior US administration official” as saying that Washington has “massive concerns” that US-based Russians who have spied for America, or have publicly criticized the Kremlin, could be targeted just like Skripal. The Times said it contacted the British Foreign Office seeking to confirm whether the Skripals would be relocated abroad, but did not get a response.

Author: Joseph Fitsanakis | Date: 9 April 2018 | Permalink

Taiwan admits for the first time that Chinese general Liu Liankun was one of its spies

Taiwan MIBThe government of Taiwan has acknowledged publicly for the first time that a Chinese major general, who was executed by Beijing in 1999 for espionage, was indeed one of its spies. The military officer was Liu Liankun, a logistician for the Chinese People’s Liberation Army, who headed its Department of General Logistics. However, China arrested Liu for espionage in 1999, and accused him of having spied for Taiwan for five years, in exchange for money. At the time, Taiwan denied that Liu spied on its behalf and refused to acknowledge that it had any role in the major general’s alleged espionage activities.

According to his Chinese government accusers, Liu passed information to Taiwan during the so-called 1996 missile crisis —known in Taiwan as the 1996 Taiwan Strait crisis. The crisis was prompted by a series of missile tests conducted by Beijing in the waters around the island of Taiwan. The crisis lasted several months, from July of 1995 to March of 1996. Many in Taiwan were convinced that China’s missile tests were the precursors of a military advance by Beijing, aimed at conquering the island one and for all. However, Taiwan’s Ministry of Defense eventually issued a press statement saying it was aware that the Chinese missiles were not equipped with armed warheads. The information was correct, but it made China realize that Taiwan was receiving information from a highly placed source inside its military. After an extensive counterintelligence investigation, the Chinese arrested Liu and accused him of having spied for Taiwan in exchange for nearly $2 million in bribes. Liu was eventually executed by lethal injection in a Beijing prison. He was 58. At the time of his conviction, Liu was the most senior Chinese military office to have ever been convicted of spying for Taiwan.

But Taiwan continued to deny any involvement in Liu’s case. That changed last week, however, when Taiwan’s Military Information Bureau unveiled its renovated memorial, which is housed at its headquarters in Taipei City. The memorial features plaques commemorating 75 individuals who have died while carrying out MIB intelligence operations. Those featured include both intelligence officers and their assets —foreign people recruited by intelligence officers to spy for Taiwan. Among the plaques, visitors to the memorial saw one dedicated to Liu for the first time. A note beneath the plaque acknowledges Liu’s contributions during the 1996 missile crisis. But it also states that the Chinese military official also provided assistance to Taiwan during earlier crises with China in the 1990s, as well as inside information about the death of Chinese Premier Deng Xiaoping in 1997.

Author: Joseph Fitsanakis | Date: 6 April 2018 | Permalink

US government publicly admits existence of rogue phone-tapping devices in DC

Embassy RowThe United States government has for the first time admitted publicly that it has detected devices known to be used by foreign intelligence services to spy on cellular communications in the nation’s capital. Known commonly as Stingrays, after a leading hardware brand, these devices are primarily used by government agencies, including law enforcement. But they can be purchased by anyone with anywhere from $1,000 to $200,000 to spare. They work by simulating the activity of legitimate cell towers and tricking cell phones into communicating with them. That allows the users of these cellphone-site simulators to monitor the physical whereabouts of targeted cell phones. Some of the more expensive Stingray models can intercept the actual content of telephone conversations and can even plant Trojans on the compromised phones of unsuspecting users.

Many governments have expressed concerns about the use of these devices, which are known to be used by intelligence agencies to monitor cellular communications on foreign soil. Major cities around the world, including Washington, are major targets of cellphone-site simulators, which are frequently located inside foreign embassies. However, the US government has never publicly commented on this issue, despite intense rumors that government agencies headquartered in Washington are major targets of Stingray devices. This changed recently, however, after Senator Ron Wyden (D-OR) wrote a letter to the Department of Homeland Security seeking information about the use of such devices in Washington. Wyden received a written response from Christopher Krebs, who heads the DHS’ National Protection and Programs Directorate. In the letter, dated March 26, Krebs confirmed that the DHS detected a number of active Stingrays in the DC area in 2017, which he referred to as “anomalous activity consistent with Stingrays”. But he added that the DHS lacks both funding and equipment needed to detect the full number of the devices and the full spectrum of Stingrays that are active in the nation’s capital.

The Associated Press, which published Krebs’ letter, said it acquired it from Wyden’s office in the US Senate. The news agency noted that the letter from DHS did not provide the technical specifications of the cellphone-site simulators, and did not enter into speculation about who might be employing them. Additionally the letter did not provide the exact number of Stingrays detected in DC in 2017, nor did it provide the exact locations in DC where Stingray activity was traced. In response to Krebs’ letter, Senator Wyden’s office released a statement blaming the US Federal Communications Commission for having failed to hold the cellular telecommunications industry accountable for the lack of security against Stingrays. “Leaving security to the phone companies has proven to be disastrous”, Senator Wyden’s statement concluded.

Author: Joseph Fitsanakis | Date: 4 April 2018 | Permalink

Dozens of successor groups forming in wake of ISIS defeat, experts warn

Hamrin Mountains IraqThe collapse of the Islamic State of Iraq and Syria is giving rise to a host of successor groups, which are quickly regrouping, recruiting members and launching increasingly sophisticated attacks against government forces, according to experts. A military victory in the war against ISIS was officially declared by the Iraqi government in December of last year. In recent weeks, United States President Donald Trump has repeated his government’s claim that American forces are “knocking the hell out of ISIS”. The Sunni militant group, which rose to prominence in 2014 after conquering much of Syria and northwestern Iraq, is clearly on the retreat, having lost every major urban center that it used to control. However, the collapse of the organization has led to the emergence of numerous insurgent groups that are quickly forming in Iraq and Syria.

Many of these highly agile groups are operating in the sparsely inhabited and remote southern district of Iraq’s Kurdish region, which includes the Hamrin Mountains. Others are found in Iraq’s arid regions west of the Euphrates. All are engaged in recruitment, propaganda and —increasingly— attacks against government forces and rival Shiite militias. Writing on Sunday, BuzzFeed’s Turkey-based Middle East correspondent Borzou Daragahi profiled one such group, the so-called White Flags. The group was formed in late 2017 through the union of two ISIS commanders, Khaled al-Moradi, an Iraqi Turkman, and Hiwa Chor, a former member of Ansar al-Islam, a predominantly Kurdish jihadist group that was active in northern Iraq after 2003. Daragahi notes that the White Flags have managed to carry out strikes in Baghdad and Kirkuk, and have repeatedly ambushed Iraqi government forces and members of Shiite militias. Senior White Flag members have been involved with ISIS for years and have “a wide range of experience [and] a high level of training”, says Daragahi. They are one of several post-ISIS armed groups that are recruiting members from Iraq’s disaffected Sunni Arab minority, while promising to protect them from the ire of the almost exclusively Shiite Iraqi government.

In a separate but related development, two analysts with Britain’s Government Communications Headquarters —the country’s primary communications interception agency— have warned that ISIS remains a “significant threat” to the West. The two analysts spoke on Britain’s Sky News television, using only their first names, Ben and Sunny. They recognized that ISIS has lost much of its territory in recent months, but cautioned that it continues to be “a very advanced adversary”, primarily due to its technological dexterity. Operational planners of ISIS have “pushed the bar and raised the bar” in terms of the “technology they have used and the ways in which they have used it”, said one of the analysts, adding that British intelligence agencies have to keep adapting their techniques to remain “one step ahead” of ISIS operatives. IntelNews regulars will recall that last year this blog advised Western counter-terrorism officials to “actively and immediately prepare” for attacks by ISIS militants using chemical weapons.

Author: Joseph Fitsanakis | Date: 3 April 2018 | Permalink

Surge in Russian spy activity prompts US agencies to bring back retired officers

FBIA surge in the activity of Russian intelligence personnel on United States soil has caused American spy agencies to rehire retired Russia specialists, according to Newsweek. Additionally, Russian defectors living in the US are reevaluating their personal safety in light of the poisoning of Russian spy Sergei Skripal in England last month, said Newsweek’s intelligence correspondent Jeff Stein in an article published on Sunday. Writing from Washington, Stein said that US counterintelligence agencies —notably the Federal Bureau of Investigation— are “on edge” over the attack on Skripal, which the British government said was carried out with a military-grade nerve agent on orders of the Kremlin.

Soviet spy agencies have a long history of assassinating defectors, called ‘wet operations’ in Russian spy parlance. But such activities were considerably scaled back after the 1970s. However, many claim that the rise of Vladimir Putin to power brought back these tactics, and that Moscow may now be investing more time and money in ‘wet operations’ training. Stein quoted one anonymous Russian defector living in the US as saying that it would be “easy [for Russian spy services] to find us if they are really determined”. It usually takes an email, text or phone call to friends or relatives back in Russia for Moscow to start tracking the physical whereabouts of defectors. In other cases, family members of defectors may be followed by Russian intelligence personnel while visiting the US to reunite with relatives, said the US-based defector.

The same source told Stein that suspected Russian intelligence personnel had been spotted by US counterintelligence teams surveilling the neighborhoods where Russian defectors reside. To address what they see as an “uptick in Russian activity […] over the past two years”, the FBI and the Central Intelligence Agency “have been bringing people out of retirement” with expertise on Russian intelligence operations, Stein reports. The veteran intelligence correspondent also spoke to retired CIA officers, who did not rule out an attempt by Russian intelligence to carry out a ‘wet operation’ on American soil. Stein contacted the CIA and the FBI, asking them to respond to these concerns. He said the CIA declined to comment, while the FBI did not return his messages.

Author: Joseph Fitsanakis | Date: 01 April 2018 | Permalink

Russia retains massive global diplomatic footprint despite recent expulsions

Russian embassiesThough unprecedented in size, the recent expulsions of over 150 diplomats by nearly 30 countries and organizations around the world have hardly made a dent on Russia’s huge diplomatic footprint. The coordinated expulsions were announced last week in response to Britain’s allegation that the Kremlin tried to kill a Russian former spy living in England. Sergei Skripal, 66, who spied for Britain in the early 2000s, and has been living in England since 2010, is fighting for his life after being poisoned with what London claims was a military-grade nerve agent. Nearly every European country, as well as Canada, Australia and the United States, expelled Russian diplomats in response to the attack on Skripal.

The largest share of the expulsions came from the United States, where the White House announced that 60 Russian diplomats had been ordered to leave by the end of the week. The majority of these diplomats are posted at the Russian embassy in Washington and consulate in New York. At least a dozen more are serving in Russia’s permanent mission at the United Nations in New York. On Thursday, several US media outlets said that all 60 Russians told to leave the US are undeclared intelligence officers serving under diplomatic cover. Fox News quoted an unnamed “senior administration official” in the US as saying that “these are not diplomats that we expelled […]. They are intelligence officers […] operating under diplomatic cover”. The official added that the Russians were expelled because they “were engaging in activities that were not commensurate with their diplomatic roles and functions”. That description is often used by governments to allude to diplomats who are in fact engaging in espionage or other intelligence-related activities.

But in an analysis piece written for the BBC, Alex Oliver, research director at the Lowy Institute in Australia, points out that the 150 diplomats expelled in recent days are but “a tiny part” of Russia’s massive diplomatic presence around the world. With 242 diplomatic posts around the world, Russia has the world’s fourth largest diplomatic footprint, behind the United States, China and France. Several thousand Russian diplomats are stationed at any one time in 143 Russian embassies, 87 consulates, and about a dozen other diplomatic missions in nearly every country in the world. Of these, approximately 170 serve in the United States. The 60 expulsions announced last week by the US government, will still leave Russia with over 100 accredited diplomats in America —many of whom are presumably intelligence officers. Earlier today, Moscow announced that it would expel 60 American diplomats, as well as nearly 100 more diplomats for other countries. The White House said that it may choose to respond with further expulsions of Russian diplomatic personnel.

Author: Joseph Fitsanakis | Date: 26 April 2018 | Permalink