The Swiss government has ordered an inquiry into a global encryption company based in Zug following revelations it was owned and controlled for decades by US and German intelligence.
Encryption weaknesses added to products sold by Crypto AG allowed the CIA and its German counterpart, the BND, to eavesdrop on adversaries and allies alike while earning million of dollars from the sales, according the Washington Post and the German public broadcaster ZDF, based on the agencies’ internal histories of the intelligence operation.
“It was the intelligence coup of the century,” the CIA report concluded. “Foreign governments were paying good money to the US and West Germany for the privilege of having their most secret communications read by at least two (and possibly as many as five or six) foreign countries.”
The mention of five or six countries is probably a reference to the Five Eyes electronic intelligence sharing agreement between the US, UK, Canada, Australia and New Zealand.
The operation, codenamed Thesaurus and then renamed Rubicon in 1980s, demonstrated the overwhelming intelligence value of being able to insert flaws into widely sold communications equipment. The CIA’s success over many years is likely to reinforce current US suspicions of equipment made by the Chinese company Huawei.
Neither China or the Soviet Union bought Crypto encryption devices, suspicious of the company’s origins, but it was sold to more than 100 other countries.
Carolina Bohren, a spokeswoman for the Swiss defence ministry, said in an emailed statement: “The events under discussion date back to 1945 and are difficult to reconstruct and interpret in the present day context.”
Bohren said that following media inquiries about the company, the Swiss government appointed a former federal supreme court judge, Niklaus Oberholzer, in January to “investigate and clarify the facts of the matter” and report back to the defence ministry in June.
Meanwhile, Switzerland has suspended foreign sales of Crypto products.
At their height, Operations Thesaurus and Rubicon provided the US with a powerful intelligence edge. When Anwar Sadat and Menachem Begin were hosted by the former president Jimmy Carter at Camp David in 1978 to negotiate an Egyptian-Israeli peace accord, the US was able to monitor all Sadat’s communications with Cairo.