Help wanted: spying on allies

The CIA's economic espionage operations draw praise--but little scrutiny--from the press.

The CIA's economic espionage operations draw praise--but little scrutiny--from the press.

by Robert Dreyfuss
Uncovering a covert action by the Central Intelligence Agency is not supposed to be so easy. This classified ad, which appeared in the Wall Street Journal on February 7 under "Positions Available," was supposedly placed by Selwyn, Bryant, and Brooke Associates in Stamford, Conn. But a call to Stamford's directory assistance revealed no firm by that name in the area. A second call to the Wall Street Journal's classifieds elicited the information that the ad was placed by Stackig Inc. of McLean, Va.--home base for the CIA. A call to Stackig confirmed that the company does work for the CIA, although their spokesperson refused further comment.

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As MoJo reported in "The CIA Crosses Over" (Jan./Feb.), the agency uses such blind ads to recruit businesspeople and professionals to serve with the CIA as "nonofficial cover" (NOC) officers. NOCs, who work overseas under clandestine cover, usually disguised as employees of major U.S. corporations, are key players in the CIA's economic espionage operations. As the end of the Cold War calls its very existence into question, the CIA is devoting substantial resources to economic spying on America's allies, using NOCs to gather intelligence on foreign technology, trade secrets, commercial contracts, and business deals.

Using the U.S. intelligence community to give American companies an edge is enormously controversial. Some experts consider it a misuse of CIA resources that ought to be directed at threats to U.S. national security. Others argue that the agency lacks the necessary expertise, and risks compromising its agents and methods. Still others raise moral objections, since economic espionage involves spying primarily on allies. Finally, the practical questions: With whom should the CIA share its data--with one U.S. company, a few, or all? In an era of multinationals, what constitutes an American company?

The CIA's economic spies are currently active in Japan, Western Europe, and key developing nations like Mexico, Brazil, India, and the countries in the Middle East. The recent spy scandal in France exposed four U.S. diplomats and a NOC--an American woman supposedly working as a public relations executive for the Dallas Market Center, owned by international real estate mogul Trammell Crow. She was accused of trying to recruit and bribe French corporate and government officials to pass technology secrets to the CIA.

Some of what the CIA sought involved France's position in trade negotiations like the General Agreement on Tariffs and Trade (GATT). But one intelligence source told Mother Jones that the prize was really France Telecom's advanced ATM (asynchronous transfer mode) switching technology. France Telecom reportedly possesses ATM capabilities that are significantly ahead of those developed by AT&T, giving the French company a leg up in the race to equip the information superhighway. In addition to stealing the ATM technology, said the source, the CIA was also trying to obtain information about France Telecom's international operations, particularly in key developing countries. Such data, he said, could directly benefit AT&T, which competes with France Telecom and its partner, the German firm Siemens, in developing technology for the "infobahn" worldwide.

In charging the United States with spying, French Interior Minister Charles Pasqua pointedly noted that "there were transgressions by their secret services not only in France, but in other European countries as well." SAT-1 TV in Germany echoed the charge, reporting that the CIA had conducted wiretapping operations against German economic targets.

Lest the French and Germans think the matter is over, according to U.S. intelligence sources there are still several CIA operations directed at French companies (such as Alcatel). Le Monde reported that the U.S. has 80 CIA agents in France, 30 of whom are NOCs.

Following the scandal, the Washington Post and the New York Times both praised the CIA's new mission--"spying on something that matters," according to the Times. An earlier New York Times piece explained how the CIA helped U.S. defense contractor Raytheon win a $1.4 billion deal in Brazil at the expense of French electronics giant Thomson CSF by collecting information on Thomson's financing terms for the deal, allowing the U.S. to match them. Other major media, including Time, Newsweek, and U.S. News & World Report, ran stories after the spying incident, generally questioning the French government's motives for so gauchely expelling the agents.

The national media skirted the question of whether the CIA should engage in economic espionage. Nor did they critically examine its execution--a particularly odd omission given recent reports of the agency's incompetence and corruption. So benign was the coverage that next time, perhaps, the CIA should ask for pro bono rates when running its NOC "help wanted" ads.

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