Agency Reporter
A FIRM, Crypto AG, which was secretly owned by the Central Intelligence Agency (CIA) in a highly classified partnership with West German intelligence, made available to the American spy agency encrypted secrets of allies and adversaries, it was learnt yesterday.
According to news report, for more than half a century, governments all over the world trusted the single company to keep the communications of their spies, soldiers and diplomats secret.
Crypto AG got its first break with a contract to build code-making machines for U.S. troops during World War II. Flush with cash, it became a dominant maker of encryption devices for decades, navigating waves of technology from mechanical gears to electronic circuits and, finally, silicon chips and software.
The Swiss firm made millions of dollars selling equipment to more than 120 countries well into the 21st century. Its clients included Iran, military juntas in Latin America, nuclear rivals India and Pakistan, and even the Vatican.
But what none of its customers ever knew was that Crypto AG was secretly owned by the CIA in partnership with West German intelligence.
These spy agencies rigged the company’s devices so they could easily break the codes that countries used to send encrypted messages.
The decades-long arrangement, among the most closely guarded secrets of the Cold War, is laid bare in a classified, comprehensive CIA history of the operation obtained by The Washington Post and ZDF, a German public broadcaster, in a joint reporting project.
The account identifies the CIA officers who ran the programme and the company executives entrusted to execute it. It traces the origin of the venture as well as the internal conflicts that nearly derailed it.
It describes how the United States and its allies exploited other nations’ gullibility for years, taking their money and stealing their secrets.
The operation, known first by the code name “Thesaurus” and later “Rubicon,” ranks among the most audacious in CIA history.
From 1970 on, the CIA and its code-breaking sibling, the National Security Agency, controlled nearly every aspect of Crypto’s operations – presiding with their German partners over hiring decisions, designing its technology, sabotaging its algorithms and directing its sales targets.
Then, the U.S. and West German spies sat back and listened.
They monitored Iran’s mullahs during the 1979 hostage crisis, fed intelligence about Argentina’s military to Britain during the Falklands War, tracked the assassination campaigns of South American dictators and caught Libyan officials congratulating themselves on the 1986 bombing of a Berlin disco.
The programme had limits. America’s main adversaries, including the Soviet Union and China, were never Crypto customers.
Their well-founded suspicions of the company’s ties to the West shielded them from exposure, although the CIA history suggests that U.S. spies learned a great deal by monitoring other countries’ interactions with Moscow and Beijing.
There were also security breaches that put Crypto under clouds of suspicion. Documents released in the 1970s showed extensive – and incriminating – correspondence between an NSA pioneer and Crypto’s founder.
Foreign targets were tipped off by the careless statements of public officials, including President Ronald Reagan. And the 1992 arrest of a Crypto salesman in Iran, who did not realise he was selling rigged equipment, triggered a devastating “storm of publicity,” according to the CIA history.
But the true extent of the company’s relationship with the CIA and its German counterpart was until now never revealed.
The German spy agency, the BND, came to believe the risk of exposure was too great and left the operation in the early 1990s.
But the CIA bought the Germans’ stake and simply kept going, wringing Crypto for all its espionage worth until 2018, when the agency sold off the company’s assets, according to current and former officials.