Echelon report accuses U.S., others, of snooping

The European Parliament received a detailed report last week that contains evidence of a 10-year effort by the U.S. government to use its intelligence technology to help U.S. companies win commercial contracts. The report was by a British journalist hired by the European Parliament to investigate a global electronic eavesdropping network.

The so-called Echelon network is run by an alliance among the U.S., the U.K., Canada, Australia and New Zealand. The report came as a panel of experts testified in Europe last week that the U.S. isn't the only country plucking sensitive corporate and economic data from the Internet and airwaves.

"I referred many times [in the report] to the fact that European countries ran satellite [signal intelligence] systems to collect intelligence," Duncan Campbell, the author of the report, told Computerworld.

France and Germany are also known to employ modern technologies designed to collect economic intelligence that would help firms in those countries. Europeans are "open-minded and readily accept that our companies and governments - like [the U.S.]" spy, bribe and cheat on occasions, Campbell said. "The European inquiry is going ahead on that basis."

In his study, Campbell accused Lexington, Massachusetts-based Raytheon Co. of receiving information from Echelon that allowed it to outbid two French firms in 1994 for a US$1.4 billion contract with the Brazilian government for a system to monitor any environmental changes in the rain forests there. A Raytheon official called the charges groundless.

"Raytheon won the [contract] because it had the best technical solution and the lowest price and best financial proposal," a company spokesman said.

Neil MacCormick, a vice chairman of the European Parliament's special commission on Echelon, called Campbell's testimony sober and balanced. The use of Echelon, particularly its Advocacy Center, which helps U.S. businesses overcome unfair trading practices, is well documented, said MacCormick.

"It therefore follows that some of the output of Echelon is used in contexts of economic intelligence affecting the interests of non-U.S. businesses," he said.

"Many European nations should look into the mirror before complaining about economic espionage by other nations," said Cees Wiebes, a professor at the University of Amsterdam who testified last week before the parliament of the Netherlands.

According to Wiebes, many Dutch multinationals - including Philips Electronics NV and Royal Dutch/Shell Group - have received intelligence gathered by the Dutch equivalent of the U.S. National Security Agency (NSA) to support construction projects at airports and seaports.

But U.S. intelligence officials insisted that Echelon isn't used to covertly assist U.S. companies in their efforts to win contracts around the world. They said Echelon is used to uncover international fraud schemes, criminal activity and terrorist groups.

A spokesman for the NSA, which manages the Echelon network, said the agency operates in strict accordance with U.S. laws that prohibit the agency from providing "intelligence information to private firms for their economic advantage."

A former CIA official familiar with NSA operations who spoke on the condition of anonymity said he finds the claims of assistance to U.S. firms by the NSA hard to believe - except in cases involving specific military technologies. Campbell and the European Union are "overplaying the economic espionage aspect of Echelon," he said.

Executives in the U.S. also discounted claims made during an European Parliament hearing last November that U.S.-produced software such as Microsoft Corp.'s Windows operating system contains back doors that support Echelon activities.

Steve Lipner, manager of Microsoft's Security Response Center, said the best example of Microsoft's position on Echelon and of not allowing back doors to be implanted in its software is evident in its opposition to legislation that would require companies to share encryption keys with federal law enforcement.

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