How the West spies on Asian telecoms
Revealed: America’s Project Echelon is bugging
Asia’s phone traffic
It sounds like a plot from a Hollywood thriller. An alliance of intelligence agencies from the West is intercepting the international and domestic communications of Asian countries, notably China, Japan and Indonesia. This project
isn’t just focused on thwarting terrorists and drug traffickers. As Grahame Lynch reports, a number of parties, including the European Parliament, are concerned that this secret project is massively abusing its powers – to the extent of feeding information to American commercial interests. This article reveals what they’re spying on and how they’re doing it
For 51 years, a secret alliance of five signals intelligence agencies in Australia, New Zealand, Canada, the United States and the United Kingdom has been intercepting and analyzing messages carried via Asian telecommunications networks.
The so-called Echelon project, formed under the 1948 UKUSA agreement, was unknown until the 1990s, largely as a result of its Cold War focus on gaining intelligence on Russia.
Echelon was historically intended as a partnership between the five major Anglo-Celtic countries, driven primarily by the US National Security Agency and the UK Government Communications Headquarters, backed up by the efforts of Canada’s Communications Security Establishment, Australia’s Defense Signals Directorate and New Zealand’s General Communications Bureau.
However, with the end of the Cold War, Echelon’s focus became less clear, leading to dissension from security operatives from less-powerful partners such as New Zealand and Canada. They began to reveal details to the media about the project’s operations, culminating in a series of investigative books and articles.
This steady stream of leaks culminated in the first official information about Echelon (also called Project P-415) in a report last month from the European Parliament on the threat this project presents to European strategic interests. This report, authored by Scottish intelligence analyst Duncan Campbell, represents the first detailed study of the available evidence for Echelon.
Indeed, none of the five partner governments had acknowledged Echelon’s existence until March this year, when the Australian government admitted the involvement of its Defense Signals Directorate in the project. What has been revealed is an extensive network of communications intelligence activities, centered around the interception of voice, fax, email and telex traffic, primarily carried via insecure media such as Intelsat satellites and public microwave transmissions. Twenty years ago, most of the world’s international telecommunications was carried via HF radio and a handful of satellites, making such interception relatively easy. But the proliferation of new telecom transmission media in recent years has made the task of interception much more onerous. The European Parliament’s Interception Capabilities report ("the IC report") estimates that some US$15 billion is now spent annually on communications intelligence across the world – with Echelon consuming the biggest share. The reason that details have leaked out about Echelon is because of its apparent new focus – to provide commercial information about foreign private sector activities to American companies. Some current and former operatives in Australia, New Zealand and Canada now believe that American use of Echelon intelligence is now undermining their own national and diplomatic interests. Asian violations The secretive nature of intelligence activities means it is difficult to confirm any of Echelon’s activities. But over the past 11 years, a handful of investigative journalists, sporadic items of mainstream journalism and official indiscretions have revealed its activities in Asia. For example: In 1988, then New Zealand defense minister Bob Tizard said that new interception capabilities in Australia planned for the early 1990s were focused on southeast Asian communication satellite transmissions The Financial Mail on Sunday alleged that in 1990 the US broke into "secret negotiations and persuaded Indonesia that AT&T be included in a multi-billion dollar telecoms deal that at one point was going entirely to Japan’s NEC" – information allegedly originating from Echelon intercepts The US Free Congress Foundation alleged that President Bill Clinton in 1993 ordered the CIA to spy on Japanese car manufacturers that were designing zero-emission cars and then pass on that information to Ford, General Motors and Chrysler The New York Times reported that the Clinton administration again used intercepts to advantage its trade negotiations with Japan over luxury car imports in 1995 Communications between Asian delegates at the APEC forum in Seattle in 1993 were tapped, according to contemporary media reports. Some 15,000 conversations were monitored, with Vietnam reported as the specific target of intelligence activities New Zealand intelligence staff were asked by the US National Security Agency in 1981 to contribute to a project which monitored the diplomatic communications of Japanese embassies, according to New Zealand intelligence analyst Nicky Hager. Probably the most extraordinary revelation was in 1996, when Australian intelligence officials leaked information to an Australian media outlet that they had placed bugs in the Chinese Embassy in Canberra on behalf of the US National Security Agency. The reason for their indiscretion? They believed the Americans were using the intelligence to advantage American companies against Australian companies in Chinese wheat deals. Interestingly, the same Chinese embassy had been the center of controversy in the late 1980s when it was first built. Australian parliamentarians claimed that its new site was one of the three best locations in Canberra to monitor Australia’s own internal defense microwave communications. Such counter-intelligence is not unknown. Journalist Pratap Chattergee has reported that Japanese agents aimed an infrared beam at a window in the Australian embassy in Jakarta to eavesdrop on conversations inside. Australia & NZ used to spy on Asia In this region, Echelon conducts most of its interception activities from satellite bases in Australia and New Zealand. The major station is located at Pine Gap in the Australian outback. Other stations are located at Geraldton on the West Australian coast, Shoal Bay in the Australian Northern Territory and Waihopai in New Zealand. Until the return of Hong Kong to China in 1997, the British maintained a massive China listening facility at Chung Hom Kok in the city. Although this was apparently dismantled prior to 1997, Hong Kong’s government has, curiously, continued to participate in a little-known group called the International Law Enforcement Telecommunications Seminar, which specifies interception requirements for telecom standards bodies on behalf of UKUSA members and some Western European nations. Monitoring of China is now primarily conducted from Australia. According to various accounts, the New Zealand station is used to intercept traffic carried by the two Intelsat satellites above the Pacific Ocean. They carry Pacific region traffic as well as Asian-American traffic. Australian activities are more focused on Asia – especially traffic carried by the Indonesian Palapa and Indian satellites. Dedicated American intelligence satellites are also used to monitor terrestrial microwave transmissions. Long-distance microwave links are characterized by the use of relay – each receiving station picks up only a portion of the signal, leaving the remainder to beam beyond the horizon and into space. The American satellites can intercept these signals from up to 80 degrees of longitude distance. Another technique which can be used is direct taps on undersea cables. In 1982, the Soviet Union discovered that a tap had been put on an undersea cable near Murmansk by an American submarine especially outfitted for this purpose, the USS Parche. The IC report suggests that subsequent taps may have been placed on undersea cables in the Middle East, South America and eastern Asia. The USS Parche remains operative to this day and continues to receive regular commendations from the US administration. The increasing use of optical technologies has yet to thwart this method of interception, for taps can be placed on opto-electronic repeaters. Efforts to intercept actual fiber optic communications have apparently not succeeded. How it’s done Even where networks are successfully tapped or intercepted there remains one major problem – transmissions are multiplexed and therefore must be deciphered for analysis. The IC report reports that "dozens of US defense contractors, mainly located in Silicon Valley (California) or in the Maryland ‘Beltway’ area near Washington, manufacture sophisticated signals intelligence equipment for the NSA". The pre-requisite of all such equipment is that it be "TEMPEST screened". This shields the emission of electromagnetic radiation which can act as a giveaway that such equipment is in use. According to the report, the first step of interception is to engage in "wideband extraction". A broad array of equipment is available for this purpose, including transponder survey equipment, radio analyzers, carrier analysis systems, demodulators, decoders and demultiplexers. One US supplier examined in detail by the report, Applied Signal Technology, manufactures a range of equipment that can analyze almost any commercial communications link. For example, its "transponder characterization system" can record, play back and analyze data at rates at up to 2.488 Gbps. Its voice channel demultiplexer can scan up to 56,700 communications channels, extracting 3,000 voice channels. It also manufactures equipment which can categorize data communications, decipher and recreate fax transmissions, collect and analyze commercial paging transmissions and even intercept videoconferencing transmissions. The report even claims that equipment for intercepting supposedly secure GSM transmissions is available in the US. Amazingly, equipment which once took up entire rows of racks has now been miniaturized to the size of a suitcase, laptop, or even a credit card. After data is collected, the second major step of interception is actual analysis. The simplest form of analysis is from signaling information, such as the telephone numbers of the originator and destination. Intelligence can be gleaned on commercial and personal associations by analyzing traffic patterns and signaling data. This remains the most common source of communications intelligence. However, a more complex and secretive form of analysis is that of actual content, particularly of faxes and emails. Over the past decade, evidence has emerged that the Echelon project maintains a vast computer system that processes intercepted data in a manner similar to a high-powered Web search engine. According to the testimony of various intelligence sources, intercepted traffic is filtered through "dictionaries" of keywords maintained by each of the five Echelon countries. Where an intercepted message contains a dictionary entry, it is automatically forwarded to the country that has nominated the keyword. A former NSA director, William Studeman, made an apparent reference to how this system works in 1992: "One intelligence collection system alone can generate a million inputs per half hour. Filters throw away all but 6,500 inputs, only 1,000 inputs meet forwarding criteria; 10 inputs are normally selected by analysts and only one report is produced. These are routine statistics for a number of intelligence collection and analysis systems which collect technical intelligence." Most of the published evidence suggests that there are two forms of communication which remain relatively impervious to keyword-based interception techniques: the actual content of voice calls and, interestingly, handwritten faxes. Although commonplace in Hollywood movies, technology which can scan thousands of voice calls for mentions of keywords is still some time off. The challenge of accents, languages and idiomatic speech is still too hard for today’s standard of voice-recognition technology. Likewise, optical character recognition technology is good at scanning reams of machine-generated typefaces, but fails badly when it comes to individual handwriting. Of course, national security agencies with legal powers to tap into individual lines do not have this problem. A former Canadian intelligence officer, Mike Frost, wrote in his 1990 book Spyworld that he had been ordered in 1975 to intercept the phone conversations of Margaret Trudeau, wife of then prime minister Pierre Trudeau, in order to establish whether she smoked marijuana! In this region, the US State Department says that Singapore, Indonesia, Malaysia, China and Taiwan all maintain extensive phone-tapping operations on their own populations. Taiwan is singled out for special mention – its law enforcement agencies receive over 100,000 authorizations annually to tap the island’s 8 million phones. The threat of encryption The continual increases in computing processing power should theoretically provide a boon for intelligence agencies seeking to expand their interception capabilities. But this trend is accompanied by another trend that thwarts such intelligence efforts – the commercial proliferation of security and encryption systems. The IC report quotes head of staff of the US House of Representatives Select Committee on Intelligence, John Millis, stating that "signals intelligence is in a crisis… over the last 50 years, technology has been a friend of the National Security Agency, but in the last four or five years, technology has moved from being the friend to being the enemy of signals intelligence." He continued "Encryption is here and it’s going to grow very rapidly. That is bad news for signals intelligence. It is going to take a huge amount of money invested in new technologies to get access and to be able to break out the information that we still need to get from signals intelligence." Security agencies have, of course, attempted to stem the tide of encryption. The first step was the promotion of the Clipper chip, which would provide encrypted communications with one proviso – the US government would hold the keys. This effort failed, but subsequent efforts have slowed the spread of encryption systems. For example, US export rules have forced major Internet software makers to release communications applications with weakened encryption algorithms. For example, Lotus Notes uses a 64-bit security key, 24 bits of which are registered with the US government. This apparently allows the US government to decipher encrypted messages in a "matter of seconds". In the case of Microsoft and Netscape 128-bit systems, some 88 bits are registered with the US government. Already, both the European Commission in Luxembourg and the Swedish government have identified transgressions of their "secure" email systems. Similarly, the GSM MoU restricted the proliferation of its most powerful security algorithm to mobile operators in friendly Western countries in the mid-1990s, giving Asian operators a less-powerful version. These restrictions have now been dropped. But restrictions don’t stop the development of more powerful encryption systems elsewhere – a prospect which the National Security Agency apparently finds troubling. During the Cold War, the NSA had a novel solution to this dilemma. It apparently negotiated a secret arrangement to access the codes used by the world’s leading post-war encryption supplier, Swiss company Crypto. This company supplied some 130 international agencies with code, trading on its Swiss location as a neutral country. The NSA, and its UKUSA partners, exploited this arrangement to secretly spy on the world’s governments. Asia: a nest of spies? Echelon isn’t the only major signals intelligence project in Asia. In the shady world of covert intelligence, alliances ebb and flow. For example, the US government and the Chinese government reportedly maintain joint listening facilities in Xinjiang, western China. Their purpose is to spy on Russia. A 1988 article in The New Statesman suggested that Chinese PLA staff had been especially flown to a Californian facility for the purposes of signals intelligence technology training. Russia is also reported to maintain signals reception facilities in Cam Ranh Bay, Vietnam, and France is believed to operate similar facilities in New Caledonia, to the northeast of Australia. Japan and China also operate satellite earth station facilities in the Pacific nation of Kiribati (which may be used for intelligence activities), while the US is also believed to gather some signals intelligence from facilities in Japan. What makes the Echelon project most interesting is the way it has been transformed from a Western intelligence front into a economic intelligence unit that apparently serves US interests to the periodic detriment of America’s own allies. At this stage, the European Parliament’s investigations have been restricted to just two committee reports, amid allegations that actual debate has been gagged. In the United States, most discussion about Echelon remains confined to alternative media and libertarian groups – the US government continues to deny the existence of Echelon. But the steady trickle of evidence from Australia, Canada and New Zealand hints at the full extent of Echelon – a massive multi-billion dollar project designed to eavesdrop on the traffic of telecommunications networks, including those of Asia’s, for the apparent commercial benefit of American business. The cast of characters CSE Communications Security Establishment, Canada’s signals intelligence agency DSD Defense Signals Directorate, Australia’s signals intelligence agency Echelon An international computer and communications network maintained by the five UKUSA signatories which intercepts and analyzes international voice, fax and email transmissions. Existence first revealed in 1980s, but not officially acknowledged by a UKUSA partner until March this year. USA has not conceded its existence European Parliament Elected wing of the European community. At the urging of a UK Labor member, its Scientific and Tecnological Options Assessment unit has commissioned and published two reports on "Technologies Used For Political Control" GSB General Communications Bureau, New Zealand’s signals intelligence agency GCHQ The Government Communication Headquarters, Britain’s signals intelligence agency ILETS International Law Enforcement Telecommunications Seminar, a group of 20 Western countries which specifies interception requirements for telecom standards and systems. Its 1998 activities include specifying interception techniques for Iridium. Its existence was first revealed in 1996, although it has been meeting since at least 1993 NSA National Security Agency, the US signals intelligence agency UKUSA agreement An agreement formed in 1948 between Australia, New Zealand, Canada, the US and the UK to share signals intelligence