Report claims CIA used second Swiss encryption firm to spy on governments

Revelation provoked outrage across Alpine European country

The CIA is accused using Swiss encryption firms to spy on governments worldwide. Reuters

Swiss politicians demanded an investigation after a report by public broadcaster SRF alleged that the CIA and its German counterpart used a second Swiss encryption company to spy on governments.

An investigation in February revealed an elaborate, decades-long set-up in which the CIA and its German counterpart monitored top-secret communications of governments through covert control of a Swiss company called Crypto.

A second but smaller Swiss encryption firm, Omnisec, was used in the same way, SRF said this week.

Omnisec was split from Swiss cryptography equipment maker Gretag in 1987, and sold voice, fax and data equipment to governments until it halted operations two years ago.

SRF's investigative programme Rundschau concluded that, like Crypto, Omnisec had sold compromised equipment to foreign governments and armies.

Omnisec also sold its faulty OC-500 series devices to several federal agencies in Switzerland, including its intelligence agencies, as well as to Switzerland's largest bank, UBS, and other private companies, the SRF investigation showed.

The findings compounded the anger felt in Switzerland after the Crypto revelations.

"How can such a thing happen in a country that claims to be neutral like Switzerland?" co-head of Switzerland's Socialist Party, Cedric Wermuth, told broadcaster SRF late on Thursday.

"This shows that the problem is broader than just one company, and we still have no answers on the political responsibility aspect," Mr Wermuth said.

Hans-Peter Portman a politician in the Liberal Party, said he was particularly concerned to learn that Swiss businesses were likely to have been implicated and possibly affected.

"This raises the question of espionage, even within the country," he told SRF.

An investigation by the Swiss parliament's Control Delegation into the Crypto case concluded this month that Switzerland's intelligence service had benefited from the information gathered by its foreign counterparts through the encryption firm.

According to the revelations in February by SRF, the Washington Post and German broadcaster ZDF, Crypto was used for decades to spy on governments.

The company supplied devices for encoded communications to about 120 countries from the end of the Second World War to early this century. Clients included Iran, South American governments, India and Pakistan.

Unknown to those governments, Crypto was acquired in 1970 by the CIA and West Germany's BND Federal Intelligence Service.

Together they rigged Crypto's equipment to be able to easily break the codes and read the government customers' messages.

Citing a classified internal CIA history of what was originally called operation Thesaurus and later Rubicon, the reports said that in the 1980s the data from the Crypto machines supplied roughly 40 per cent of all the foreign communications US codebreakers processed for intelligence.