A group of executives from an American military contractor have quietly visited Israel several times in recent months to try to carry out a bold but risky plan: to buy NSO Group, the notorious hacking company. technology reputation.
The setback was significant for the team from the American company, L3Harris, which also has experience with spyware technology. They start with the uncomfortable fact that the US government has blacklist NSO just a few months earlier because Israeli corporate spyware, called Pegasus, had been used by other governments to break into the phones of political leaders, human rights activists and journalists .
Pegasus is a “zero-click” hacking tool that can remotely extract everything from a target’s cell phone, including messages, contacts, photos and videos, without the user having to click on the link. phishing link to grant it remote access. It can also turn a cell phone into a tracking and recording device.
NSO acted “contrary to the national security or foreign policy interests of the United States,” the Biden administration said when it announced the blacklist in November, barring American companies from doing business with the Israeli company.
But five people familiar with the negotiations say that the L3Harris team gave them a surprising message that a deal seemed doable. They said that US intelligence officials have quietly supported the plan to buy NSO, whose technology has over the years been viewed by many intelligence and law enforcement agencies around the world, including the FBI and CIA. heart.
Negotiations continued in secret until last month, when Words about NSO sales ability leaked and send all sides to scramble. White House officials said they were outraged to learn of the negotiations and that any attempt by US defense companies to buy a blacklisted company would be met with serious resistance. .
Days later, L3Harris, which relies heavily on government contracts, informed the Biden administration that it was considering a plan to buy NSOs, according to three US government officials, despite several acquaintances familiar with the negotiations said efforts had been made to revive the talks.
What remains are questions in Washington, other allied capitals and Jerusalem about whether parts of the US government – with or without knowledge of the White House – have seized the opportunity to try to control spyware. NSO’s strong message under US authority or not, despite the administration’s very public stance against the Israeli company.
It also unsettles the fate of NSO, whose technology has been instrumental in Israel’s foreign policy even as the company has become the target of fierce criticism for the way governments use it. spyware against their citizens.
The episode is the latest skirmish in the ongoing war between nations for control of some of the world’s most powerful cyberweapons, and it reveals some of the difficulties the alliance of nations – including entire United States under the Biden administration – as it tries to rein in the lucrative global market for sophisticated commercial spyware.
Spokespersons for L3Harris and NSO declined to comment on negotiations between the two companies. A spokesman for Avril Haines, the director of national intelligence, declined to comment on whether any US intelligence officials had quietly blessed the discussions. A Commerce Department spokesperson declined to give specifics about any discussions with L3 Harris about the purchase of NSO.
A spokesman for the Israeli Defense Ministry declined to comment, as did the Israeli Prime Minister’s spokesman.
The Biden administration’s decision to put NSO on the Commerce Department’s blacklist comes after years of revelations that governments used Pegasus, the NSO’s top hacking tool, as a domestic surveillance tool. . But the United States itself also bought, tested, and deployed Pegasus.
In January, The New York Times disclosure that the FBI purchased the Pegasus software in 2019 and that government lawyers at the FBI and Department of Justice debated whether to deploy the spyware for use in domestic law enforcement investigations. are not. The Times also reported that in 2018 the CIA purchased Pegasus for the Djibouti government to conduct counterterrorism operations, despite that country’s record of torturing political opponents and imprisonment. journalists.
L3’s decision to terminate the acquisition talks will put the future of NSO in doubt. The company saw the deal with the US defense contractor as a potential lifesaver after being blacklisted by the Commerce Department, which crippled its business. American companies are not allowed to do business with blacklisted companies, subject to sanctions.
As a result, NSO couldn’t buy any American technology to keep it running – whether it’s Dell servers or Amazon’s cloud storage – and the Israeli company had hoped that the sale to a in the US could lead to the lifting of sanctions.
For more than a decade, Israel has viewed the NSO as a de facto arm of the state, granting Pegasus licenses to many countries – including Saudi Arabia, Hungary and India – that the Israeli government hopes. will strengthen security and diplomatic ties.
But Israel has also denied Pegasus to other countries for diplomatic reasons. Last year, Israel refused the request of the Ukrainian government purchased Pegasus for use against targets in Russia, out of concern that the sale would damage Israel’s relations with the Kremlin.
The Israeli government also makes extensive use of Pegasus and other locally produced cyber tools for its own intelligence and law enforcement purposes, creating further impetus to find ways for NSOs to survive the orders. US sanctions.
During discussions about the possible sale of NSOs to L3 Harris – which included at least one meeting with Amir Eshel, the Director-General of Israel’s Ministry of Defense, who would have to ratify any deal – L3Harris representatives said: know they have received permission from the US Government to negotiate with NSO, despite the company’s presence on the US blacklist.
A representative for L3 Harris told the Israelis that US intelligence agencies support the acquisition as long as certain conditions are met, according to 5 people familiar with the discussions.
One of the conditions, the people said, was that NSO’s arsenal of “zero days” – a flaw in computer source code that allowed Pegasus to break into mobile phones – could be sold to all partners. of the United States in the so-called Five Eyes Intelligence Sharing Relationship. Other partners are the UK, Canada, Australia and New Zealand. A senior British diplomat declined to comment on questions about the extent of British intelligence’s understanding of a possible deal between L3 and NSO.
Such a scheme would be highly unusual if it were finalized, as Five Eyes countries typically only buy intelligence products that have been developed and manufactured in those countries.
Israeli Defense Ministry officials were open to the deal. But after heavy pressure from the Israeli intelligence community, it turned down another request: the Israeli government to allow NSO to share computer source code with Pegasus – allowing it to exploit vulnerabilities in the phones on which it targeting – with Five Eyes countries. They also disagreed, at least in the early stages, of allowing L3’s network specialists to come to Israel and join NSO’s development teams at the company’s headquarters north of Tel Aviv.
A representative of the Ministry of Defense also confirmed that Israel still had the authority to issue export licenses for NSO products, but said it was ready to negotiate on which countries received the spyware.
During the discussion, there were many issues that required the approval of the US government. Representatives for L3Harris say they have discussed the issues with US officials, who have agreed in principle, according to people familiar with the discussions.
To help negotiate the sale of NSO, L3Harris hired an influential Israeli attorney with deep ties to the Israeli defense establishment. The lawyer, Daniel Reisner, is the former Head of International Law at the Israel Military Prosecutor’s Office and served as a special adviser on the Middle East peace process to former Prime Minister Benjamin Netanyahu.
In the months since the Biden administration announced the blacklist in November and as the Israeli government tries to find a way to stop NSO from operating, the Department of Commerce in Washington has sent a list of questions to the NSO and a company. Other Israeli hacks have been blacklisted. also, about how the spyware works, who it targets, and whether the company has any control over how its national customers deploy the attack tools.
The list, reviewed by The Times, asked whether NSO maintains “active control over its products” and whether Americans abroad are protected from NSO products being developed. testify against them or not.
Another asked if NSO would “close access to its products if the US government informs them that there is an unacceptable risk of this tool being used by a particular customer to human rights violations?”
As for the proposed NSO and L3 Harris deal, Israeli officials have been unsuccessfully negotiating with the Commerce Department to remove the NSO from the US blacklist ahead of President Biden’s trip to Israel next week. .
News last month about L3Harris talks to buy NSO appeared to have blinded White House officials. After the site Online wisdom Reported on the possible sale, a top White House official said such a transaction would raise “serious counterintelligence and security concerns for the United States government” and the administration. will work to ensure that the deal doesn’t happen.
The official said that a US company, especially a defense contractor, should have known that any transaction “would prompt an in-depth review process to see if the transaction process caused counterintelligence threat to the United States, its government, and its systems and information.”
Last week, in response to a question from The Times, another US official said that no part of the US government supported L3’s purchase of NSO, and that “after learning of the potential acquisition, IC conducted an analysis that raised concerns about the impact of government purchases and position announcements. “
While not a name in the home defense industry like Lockheed Martin or Raytheon, L3Harris makes billions of dollars a year from US government contracts at both the federal and state levels. According to the company most recent According to the annual report, more than 70% of the company’s revenue in fiscal year 2021 comes from various US government contracts.
USAspend.gova website that tracks government contracts, indicates that the Department of Defense is L3Harris’ largest government customer.
The company once produced a monitoring system called Ray was used by the FBI and local US police forces until the company stopped production. In 2018, the company purchased azimuth Security and Linchpin Labs, two Australian networking companies that Vice report sold zero day mining to Five Eyes countries.
In 2016, the FBI asked Azimuth to help break into the Apple phone of a terrorist who carried out a deadly shooting in San Bernardino, California, that killed more than a dozen people, according to a report inside Washington Post.
Azimuth working for the FBI ended a standoff between the office and Apple, which refused to help the FBI unlock phones in the San Bernardino case. The tech giants argue that they don’t have a backdoor to allow the FBI access to the phone and don’t like creating a backdoor because it would undermine the iPhone’s security features it promotes to its customers. me.
Susan C. Beachy Contributing research.
