Israel privatized communications intelligence intercept technology

As more details emerge about two Israeli companies, the corporate leadership of which largely consist of former officers of Unit 8200—Israel’s version of the U.S. National Security Agency—it is clear that Israeli intelligence has embarked on a policy of privately profiting from its signals intelligence capabilities. By transferring sophisticated communications intercept technology to the private sector, which, in turn, sells it to governments that are among some of the world’s worst human rights violators, Israel has again demonstrated that it places profits over propriety.

At issue are formerly-classified capabilities that permit intelligence agencies, law enforcement, and now, thanks to the Israelis, organized crime syndicates to intercept smart phone conversations, email, text messages, and stored data.

Not surprisingly, the leadership of the two Israeli firms that are involved in sensitive technology transfer are veterans of Unit 8200, which is headquartered in Herzliya, located just north of Tel Aviv, and is also the location of Mossad’s operational headquarters.

One of the firms is NSO Group, which is reported to have sold a system called Pegasus to countries like the United Arab Emirates, Saudi Arabia (which used Pegasus to track the Saudi columnist for The Washington Post, Jamal Khashoggi, in Istanbul and then murder and dismember him inside the Saudi Consulate-General), Rwanda, Kazakhstan, Bahrain, Azerbaijan, Mozambique, Hungary, Togo, Morocco, India, Yemen, and Mexico.  NSO Group’s two co-founders are Shulev Hulio and Omri Lavie, both, reportedly, former military members of Unit 8200. The other firm is Paragon Solutions of Tel Aviv. Its co-founder and CEO is Ehud Schneorson, also an ex-member of Unit 8200. One of the members of Paragon’s board of directors is former Israeli Prime Minister Ehud Barak, who has been implicated in the Jeffrey Epstein underage sex trafficking scandal owing to Barak’s frequent visits to Epstein’s Manhattan townhouse when underage girls were present. Epstein and his chief assistant, Ghislaine Maxwell, have reportedly been linked to Mossad as important assets. Maxwell’s father, billionaire publisher Robert Maxwell, was a top Mossad functionary.

The sale of Pegasus to Mexico is reported by the Daily Beast to have involved former Republican National Committee co-finance director and Donald Trump ally Elliott Broidy, who was pardoned by Trump after his conviction for violating the Foreign Agents Registration Act or FARA. The twice federally-indicted and convicted Broidy, who falsely accused this editor of being an agent for the government of Qatar, has represented the interests of the UAE in its diplomatic and financial battle with Qatar.

The Daily Beast, like WMR, was threatened by Broidy’s attorney with legal action for reporting on Broidy’s illicit activities. In the case of the Daily Beast it was its report on Broidy acting as a middleman in NSO Group’s sale of Pegasus to Mexico. In April 2011, Broidy hosted a meeting in Los Angeles attended by NSO Group’s Hulio and Lavie.

Matan Caspi, a former employee of Broidy Capital Management in Los Angeles, was hired as a marketer by NSO Group. According to the Daily Beast, Caspi worked in 2010 with Broidy and a Japanese-Mexican businessman named Jose Susumo Azano Matsura (nicknamed “Mr. Lambo”), the owner of Security Tracking Devices SA de CV of Jalisco, to effectuate the sale of Pegasus to Mexico. Azano personally presented a Pegasus briefing to the Mexican defense secretary and the president of Mexico, who, at the time, was Felipe Calderon.

Details of the Broidy connection to NSO Group and Pegasus appear in a lawsuit filed in Tel Aviv by Caspi’s partner, Eric Banoun, who is claiming that NSO Group failed to pay him a 10 percent commission for the sale of Pegasus to Mexico. Although the NSO Group deal with Mexico was considered an Israeli state secret, reneging on paying a commission in Israel appears to trump national security.

In 2014, Azano, who was known to have connections to Mexico’s drug cartels, was arrested by the FBI at his home in Coronado, California, near San Diego. Azabo was charged with making illegal political contributions in the United States totaling some $600,000. Azano was found guilty and sentenced to a three-year prison term.

Mexican Public Safety Secretary Rosa Icela Rodríguez, a member of the Cabinet of President Andrés Manuel López Obrador (AMLO), revealed that the Mexican government paid NSO Group over $60 million for the Pegasus intercept suite between 2011 and 2018. AMLO has vowed to bring to justice corrupt former Mexican presidents, including the two that relied on Pegasus—Calderon and Enrique Peña Nieto. One of the targets of Pegasus was AMLO and his closest political advisers and family members. AMLO has promised to never use intercept systems like Pegasus.

It has now come to light that Pegasus has been used for purely political intelligence gathering purposes with major targets for surveillance including the current presidents of France, Pakistan, Iraq, and South Africa, as well as the prime minister of Pakistan and AMLO prior to his inauguration. French intelligence has confirmed that Pegasus was used to target French citizens, including 14 ministers in the French Cabinet.

The number of journalists and human rights and civil liberties activists known to have been targets of Pegasus has also grown exponentially as details concerning the spyware continue to emerge. Pegasus has also been found to have permitted intelligence and law enforcement agencies to plant concocted evidence, a process known as “document delivery,” on targeted smart phones. The Indian government of right-wing Hindu nationalist Narendra Modi has used document delivery capabilities to plant false evidence on the phones of Christian, Muslim, tribal, and Dalit activists as a pretext for jailing them on phony charges that include “terrorism.”

Microsoft President Brad Smith has warned against the proliferation of Israeli firms like NSO Group and Paragon Solutions, stating, “An industry segment that aids offensive cyberattacks spells bad news on two fronts. First, it adds even more capability to the leading nation-state attackers, and second, it generates cyberattack proliferation to other governments that have the money but not the people to create their own weapons. In short, it adds another significant element to the cybersecurity threat landscape.”

Paragon Solutions’ major financial backer is Boston’s Battery Ventures. Paragon’s spyware product, which apparently has not yet been sold to any customers, offers access to such end-to-end encryption applications as WhatsApp, Signal, Facebook Messenger, and Gmail. It has another capability that has eavesdroppers around the world excited. Paragon’s Trojan horse surveillance capabilities remain in a targeted smart phone even after it is rebooted. Paragon’s secretive Boston financial backer may indicate a U.S. intelligence connection to the company and its spyware product. A few of Paragon Solutions principals are not only ex-Unit 8200 but have also worked for NSO Group. Forbes magazine has reported that Paragon is positioning to sell its intercept product to U.S. law enforcement, which had not been keen on using Pegasus.

Another Israeli firm with ex-Unit 8200 links, is Toka. Its specialty is hacking into “Internet of Things” devices like Amazon’s Echo. Toka was co-founded by retired General Yaren Rosen, the former chief of the Israel Defense Forces Cyber Staff. Formerly serving on Toka’s board was the omnipresent Ehud Barak.

As a result of the exposures surrounding its global spyware business, Israel has marshaled all of its usual suspects in a major public relations window dressing campaign. The most spurious claim is that Israel would never sell sophisticated spyware to human rights violators. That contention is laughable when considering it is coming from one of the world’s worst human rights violators.

Previously published in the Wayne Madsen Report.

Copyright © 2021

Wayne Madsen is a Washington, DC-based investigative journalist, author and nationally-distributed columnist. A member of the Society of Professional Journalists (SPJ) and the National Press Club. He is the editor and publisher of the Wayne Madsen Report (subscription required).

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