Business spy threat is real, former CIA chief says

Threats to the security of business information are numerous and they come from all directions, including organized crime syndicates, terrorists and government-sponsored espionage, and most global high-technology companies have little idea of the array of hostile forces targeted against them, a former U.S. director of intelligence said Monday.

U.S. businesses that are increasingly expanding their operations into foreign lands are finding the situation challenging because the nature of such threats and how to protect against them is not taught in business school, said Robert Gates, director of the Central Intelligence Agency (CIA) from 1991 to 1993.

Some of the threats might be obvious, as well as the strategies that companies can mount against them, but others might not be so cut and dried, said Gates, who delivered the keynote address to an international gathering of information security specialists at a two-day conference in Washington sponsored by the Arlington, Virginia-based Information Technology Association of America.

In a world in which countries measure themselves in terms of economic might, many intelligence services around the world are shifting their emphasis and their targets to business, Gates said. Government-sponsored intelligence operations against companies seek information about bids on contracts, information that affects the price of commodities, financial data and banking information.

"They want technological production and marketing information, and they usually share what they get with their country's companies. To get this sensitive information, government intelligence services use many of the techniques developed during the Cold War," said Gates, who is now dean of the George Bush School of Government and Public Service at Texas A&M University.

That includes bugging telephones and rifling through papers left in hotel rooms by visiting businessmen and businesswomen. In addition government intelligence services are known to plant moles in companies and steal or surreptitiously download files from unsecured computers. Several also have "highly sophisticated signal intelligence capabilities" to intercept even encrypted company communications. Messages that are not encrypted with the latest technology are especially vulnerable. These include both telecommunications and computer communications, including e-mail, the former CIA director said.

Though the French intelligence service is "probably the most egregious offender," it is far from alone, Gates said. Russia, China, South Korea, India, Pakistan, Germany, Israel and Argentina all have some type of intelligence-gathering operation for the benefit of companies in their countries, and Gates said many more countries are doing the same. The U.S., however, is not among them.

"I can assure you that no American intelligence agency conducts industrial espionage against foreign companies to advantage U.S. companies," he said. "What we do is support the efforts of our own government, and that information is not shared with American companies."

Reports originating in Europe, especially France, that the U.S. is using signal intelligence capabilities as part of a program called Echelon to attack European companies to the economic advantage of U.S. companies "is simply not true," he said.

Another threat comes from the dozens of intelligence services in developing countries that have profited from the training they received from the Soviet Union, Eastern European countries and the CIA during the Cold War. The result of this history is that "the reservoir of professionally trained intelligence mercenaries is growing."

Other threats include terrorism, organized crime and inside operations carried out by disgruntled employees and hackers. Some of these groups are looking for the greatest amount of destruction, and an attack on the critical information infrastructure of the U.S. would satisfy that goal.

"Business needs to understand that the criminal and terrorist threat worldwide is changing and is now both more sophisticated and more dangerous than anyone would have thought," Gates said.

Vulnerabilities that all the different types of attackers exploit include open systems, plug-and-play systems, centralized remote maintenance of systems, remote dial-in and weak encryption. But he said companies can provide substantial information security protection for relatively low cost.

He suggested companies review security measures in sensitive areas of their operations such as research and development, talk to traveling executives who carry company laptops about using precautions to prevent theft and examine communications with overseas facilities with an eye toward installing commercially available encryption that is all but impossible to crack. The new algorithm recently approved by the U.S. Commerce Department, for example, is so strong that it would take an estimated 149 trillion years to unscramble, he said.

Gates also said company executives should limit physical access to sensitive data and programs and regularly change computer passwords.

"It's all obvious, but every one of you knows how many companies are lax in their actual implementation," Gates said.

A basic rule is to take time to identify company critical information, whether it is technology, a production technique, basic research and development, financial information or marketing strategy, and take steps to protect it.

"What is required first is simply awareness by CEOs and boards of directors that there is a threat and then respond using a common-sense way to protect themselves," Gates said. "These are measures that make good business sense even if you are not a target of a government intelligence service, a competitor, a criminal organization, a terrorist or a hacker."

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