INTELLIGENCE ISSN 1245-2122 N. 92 New Series, 25 January 1999 Every Two to Three Weeks Next Issue on 15 February 1999 Publishing since 1980 Editor Olivier Schmidt (email intelligence-adi@wanadoo.fr; web http://www.blythe.org/Intelligence) TABLE OF CONTENTS, N. 92, 25 January 1999 FRONT PAGE WORLDWIDE - FRANCE BREAKS RANKS WITH USA & AGAINST USA ON CODES p.1 TECHNOLOGY AND TECHNIQUES NEW NON-LETHAL LAW ENFORCEMENT TECH UNDER STUDY IN BRITAIN p.2 SECRET BRITISH GOVERNMENT SURVIVAL ZONE & TECH REVEALED p.3 PEOPLE USA/ISRAEL - MARTIN INDYK p.4 Jonathan Jay Pollard. p.5 CANADA/GREAT BRITAIN - MARION DE CHASTELAIN p.6 IRAQ/GREAT BRITAIN - JABER SALEM p.7 AGENDA COMING EVENTS THROUGH 15 MARCH 1999 p.8 INTELLIGENCE AROUND THE WORLD USA - EMBASSY BOMBING REPORT & HARD LESSONS FROM TERRORISTS p.9 Open Source Intelligence. p.10 CANADA - A "FBI-Written" Alarmist Security Report. p.11 GREAT BRITAIN - ISC'S BRIT SPOOKS & YANK PAST AT CHICKSANDS p.12 PARLIAMENTARY "WATCHDOG" CRITICIZES MINISTRY OF DEFENCE p.13 THE SCOTTISH NATIONAL PARTY & ITS "FRIENDS" p.14 IRELAND - FUND-RAISING PROBLEMS FOR REPUBLICAN PARAMILITARIES p.15 FRANCE - HOSTILITIES OPEN IN INTERNAL SECURITY WAR p.16 GERMANY - STASI FILES STILL "ACTIVE" ... POLITICALLY p.17 EU - European Drug War is "Probably" Lost. p.18 WESTERN EUROPE - Open Source Intelligence. p.19 CHECHNYA - DEAD ENGINEERS WERE INTELLIGENCE "ASSETS" p.20 EASTERN EUROPE - Open Source Intelligence. p.21 CHILE - THE GENERAL AWAITS RETURN AS INTELLIGENCE LEAKS p.22 IRAQ - LEAK & COUNTER-LEAK AROUND USCOM, CIA, NSA, MOSSAD... p.23 WORLDWIDE - CONTROL RISKS-MI6 REPORTS & BIN LADEN MANIA p.24 --------------------------------------------- FRONT PAGE Intelligence, N. 92, 25 January 1999, p. 1 WORLDWIDE FRANCE BREAKS RANKS WITH USA & AGAINST USA ON CODES By far the most significant intelligence and security news of the fortnight is French Prime Minister Lionel Jospin's 19 January announcement that France is suddenly reversing its long-term and traditionally restrictive policy toward the public use of encryption systems and allowing complete freedom of use of systems with key lengths up to and including 128 bits. Currently, only 40 bit keys are legal and they must be deposited with a trusted third party ... of which there is only one recognized in all of France. Under today's French law, the government has a right to understand any type of communication using public facilities, meaning post, telecommunications, semaphores, or what have you, although this law is seldom invoked publicly. The implication of this French decision goes far beyond France itself and is the first splash of a tidal change that will, in all likelihood, drown the international public encryption policy the US is trying to impose on the world in the name of fighting crime, drugs and terrorism. France, which has probably suffered more deaths in the past few years from foreign terrorists than any other developed nation, "heard the players, questioned the experts and consulted its international partners" and explicitly decided that American high-tech eavesdropping and economic espionage is more detrimental to French interests than terrorists using encrypted communications. The American menace is easily discernable in the opening lines of Mr. Jospin's statement concerning this tidal change in encryption policy: "With the development of electronic espionage instruments, cryptography appears as an essential instrument of privacy protection." No mention of crime, drugs or terrorists. Since the EU has already imposed much stronger privacy protection laws than the US, has debated the threat posed by the NSA Echelon worldwide telecommunications surveillance system, and has resisted "falling in line behind the FBI" on public eavesdropping, experts expect all EU countries to announce similar public encryption liberalization in the near future. Indeed, this seems to be the developing EU strategy of letting the "uppity, snobbish Gallic French stand up to the Americans", something the French have always done with pride. Then, "once the rampart is breached", suddenly the other EU countries follow suit in a movement that could only have been negotiated and organized beforehand. Specialists know it's coming on drug policies, but very few anticipated that a French Socialist government would stand up so unexpectedly to French security and intelligence services (which imposed the 40 bit key limit, a record lower limit in Western countries) and to the US. Now it's done, the floodgates are open and watch what's going to happen ... (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 9 USA EMBASSY BOMBING REPORT & HARD LESSONS FROM TERRORISTS On 8 January, the State Department released the public version of a report by the ten-member Accountability Review Board (ARB), chaired by retired US Navy Admiral, William Crowe, a former chairman of the Joint Chiefs of Staff and ambassador to Great Britain. The ARB, consisting of senior retired military, diplomatic and intelligence officials, was convened last September to investigate the near-simultaneous bomb attacks on the US embassies in Kenya and Tanzania that killed 224 people, including 12 Americans. According to the report: "The board did not find reasonable cause to believe that any employee of the United States government or member of the uniformed services breached his or her duty in connection with the 7 August bombings. However, we believe there was a collective failure by several administrations and congresses over the past decade to invest adequate resources to reduce the vulnerability of US diplomatic missions around the world to terrorist attack." Policy makers and intelligence officials, the report said, focused too closely on areas considered high risk at the expense of other sites such as the African embassies. Intelligence agencies were also said to have placed too high a priority on "warning intelligence". The panel said that 88 percent of the overseas diplomatic posts did not meet standards for safe operations. The commission's harshest criticism was for the government's failure to contemplate the repetition of truck bombs such as the 1996 attack against a US Air Force dormitory in Saudi Arabia and the 1983 destruction of the US Marine barracks and the US Embassy in Beirut. The commission proposed that all overseas facilities should be brought up to the standards recommended in a similar 1985 diplomatic security report by a panel headed by former CIA Deputy Director, Adm. Bobby Ray Inman. The ARB report faulted several administrations for not implementing these 1985 recommendations which were never financed by Congress, despite State Department insistence. Now, the ARB has recommended that the State Department spend more than $10 billion over the next decade to upgrade embassy security. (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 12 GREAT BRITAIN ISC'S BRIT SPOOKS & YANK PAST AT CHICKSANDS A psychic problem for the Ministry of Defence (MoD) are claims that the new headquarters for the Intelligence and Security Centre (ISC, an all-services agency established in 1996 to coordinate covert intelligence operations), the 850-year old Chicksands Priory near Bedford, is haunted by at least nine spirits, including a nun called Rosata who was entombed after being forced to watch her lover's execution. After several sightings, unexplained laughter and moving lights in unoccupied rooms, the MoD deployed surveillance equipment and seismic sensors but nothing conclusive was recorded. Brigadier Chris Holten, head of the ISC, appreciates the irony of an intelligence agency being haunted by spooks. He believes the apparitions are recordings of "traumatic events imprinted in the fabric of the building". Permission has been obtained for a new investigation involving ISC personnel using high-tech pressure sensors, night vision recorders, infrared video, temperature and movement sensors, to prove Brig. Holten's conviction that there is a "spiritual element to the intelligence business". (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 16 FRANCE HOSTILITIES OPEN IN INTERNAL SECURITY WAR A strange press report recently warned intelligence specialists that "something's up" in French internal security and the "happenings" come just as Interior Ministry, Jean-Pierre Chevenement, has returned to his post after nearly dying from an allergic reaction during an operation a few months ago. While the established media are preoccupied with urban violence and the open confrontation between the Interior Ministry and the Justice Ministry on handling juvenile delinquency in major cities, a brief report mentioned that Chevenement was "negotiating" with a former leader of the defunct far-right Gaullist SAC "parallel police" to bring together the RGs and the DST to form a single internal security and intelligence service. The Renseignement Generaux (RGs) is a specifically French political intelligence police, while the Direction de la Surveillance du Territoire (DST) is France's internal security service. Both are under the authority of the Interior Ministry. This strange report raised eyebrows among specialists who know that the SAC and its aging leaders no longer carry any weight in intelligence or in officially-sanctioned "dirty tricks" ... even in Africa, France's "pre-carre" or "backyard". "Intelligence" dug into the question and found that the article probably resulted from an ongoing attempt in certain quarters of the RGs to resist "assimilation by the DST". Indeed, urban violence, and particularly its use by Islamic extremists for building support networks, has the Interior Ministry worried. Added to this, intelligence from the data bases belonging to various law enforcement units has not been shared and several high-priority cases have stagnated or have been sabotaged through lack of cooperation. This has infuriated Chevenement and senior Interior Ministry officials. Indeed, if Interior "can't get its game together", the Defence Ministry's Gendarmes, in charge of law enforcement throughout France except for urban centers of over 20,000 population, would quite willingly march in and take over. (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 17 GERMANY STASI FILES STILL "ACTIVE" ... POLITICALLY On 18 January, the German government announced that the CIA was going to return one of the only three full copies of archives of former East Germany's formidable foreign intelligence service, the Hauptverwaltung Aufklaerung (HVA), part of the sinister Ministerium fuer Staatssicherheit (MfS or Stasi). Last November, "Intelligence" described CIA "Operation Rosewood" and how US intelligence moved fast to recover a maximum of Stasi documents when the Berlin Wall started coming down and East Germany started falling apart in 1991. During a famous public demonstration and night-time raid on Stasi Normanenstrasse headquarters in Berlin, US Naval Intelligence was already in place with good Stasi contacts and reportedly made off with four trucks loaded with Stasi documents. It apparently was an enterprising, young Naval Intelligence officer who established contact with Stasi officers that led to the four-truck Normanenstrasse heist and probably to Operation Rosewood (INT, n. 89 16). The latter was essentially a "walk-in job". A group of Stasi generals knew that there were three complete copies of Stasi files, including HIV secret agent files. One paper copy was, of course, at Normanenstrasse and was trashed by the public, Naval Intelligence and certain Stasi officials. "Intelligence" obtained documents from that set of material. Another complete set on paper is in Moscow with the SVR. What the CIA got was the microfilm "war reserve", a complete copy the Stasi had made and stored in safekeeping in another Eastern European country - - not the Soviet Union -- in case of war and the necessity to destroy the Normanenstrasse set of files. It was also a guarantee that in case of war, East Germany and the Stasi would not be entirely dependent on Russia -- or the former Soviet Union -- for access to its archives and access to good intelligence. It was this microfilm "war reserve" that the group of Stasi generals "walked in" and proposed to sell to US intelligence, probably through the Naval Intelligence contact. The CIA and the Stasi generals got down to "brass tacks" and a deal was made for the sum of $1 million. Little is known about where the $1 million went ... East or West. (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 20 CHECHNYA DEAD ENGINEERS WERE INTELLIGENCE "ASSETS" The four engineers employed by Granger Telecom and British Telecom, who were kidnapped and murdered in Chechnya last year, had been asked by the Foreign Office (FO) to provide information about key political figures and economic investment potential in the northern Caucasian republic. The men were kidnapped in the capital, Grozny, last October while working on a five-year, $350 million contract to install a mobile telephone network and satellite links. Their decapitated bodies were found near the city two months later, amid allegations that they had confessed to spying for the British government. In the House of Commons, the Foreign Office minister, Tony Lloyd, criticized the men's employers for ignoring FO advice about working in Chechnya, one of the countries Western security and intelligence analysts consider too dangerous for foreign governments to operate. Mr. Lloyd told MPs that the FO's advice to Granger about the dangers had been "clear and unambiguous". FO officials met with senior executives from Granger last July to discuss the nature of the Chechen Telecom contract. On that occasion the FO warned of the dangers of travelling and working in the "lawless region" of the Caucases, a warning confirmed by Granger chief executive, Ray Worth, who admitted that the Surrey-based company "undertook the contract with the knowledge and considered the risks were worth the effort". It has also emerged that the FO raised the issue of the two British aid workers, Camilla Carr and Jon James, kidnapped in 1997 while running a Quaker-funded orphanage in Grozny, and had indicated that any information about their whereabouts would be welcome. The proposal was referred to in correspondence between the FO's Eastern Division and Granger, obtained by "The Independent". In a letter, dated 13 August 1998, the FO desk officer wrote: "As part of our efforts to secure the safe release of Camilla Carr and Jon James, we have had frequent, if so far relatively unproductive, contacts with the Chechen leadership. As one of the very small number of British companies involved in Chechyna and having first-hand knowledge of the capital, we would welcome your views on the potential for investment." The letter repeated the official advice about the dangers, before finally asking for views on contacts "considered to be movers and shakers" who might be able to secure the release of the charity workers. (...cut...) --------------------------------------------- Intelligence, N. 92, 25 January 1999, p. 24 WORLDWIDE CONTROL RISKS-MI6 REPORTS & BIN LADEN MANIA Control Risks Group (CRG), Britain's leading risk assessment consultancy, has produced a report on the risks facing British firms doing business overseas, a threat underlined by the deaths of four employees of the Surrey-based telecommunications company, Granger, who were kidnapped and beheaded by rebels in Chechnya last month while working on a œ150 million mobile phone contract for the Chechen government. The report, published on 28 December, states that the international financial crisis, particularly in south-east Asia, has led to a deteriorating business environment, weak political leadership and an increase in crime. It warns that in Indonesia, "where social safety nets are weakest", the unresolved political turmoil is likely to disrupt the first post-Suharto elections later this year. CRG also claims that Russian Prime Minister, Yevgeny Primakov, has "no plausible strategy" for the country's economic malaise and "political upheavals are certain" throughout 1999. While established Western economies, and those of China, New Zealand and Australia, are "relatively risk free", the growth of organized crime in the emerging economies of central and eastern Europe will represent a "major challenge" for EU law enforcement in the foreseeable future. Control Risks has a long-standing professional relationship with MI6 British foreign intelligence: many of the company's executives are former members of Her Majesty's intelligence and defence services. So it is not surprising that the CRG's risk assessment squares neatly with recent MI6 "raw intelligence" concerning and upsurge in training at relocated camps controlled by Osama bin Laden in Afghanistan. The CRG report claims Bin Laden runs "two front organisations while financing, training and inspiring at least ten other extremist bodies", the prime targets of which are US and British business and diplomatic interests, and international aviation. (...cut...) ---------------------------------------------