Weekly Intelligence Notes #43-02
11 November 2002

WIN 43-02 dtd 11 November 2002

 Weekly Intelligence Notes (WINs) are produced and edited by Roy Jonkers for non-profit educational uses by AFIO members, ISIS associates and WIN subscribers. RADM (ret) Don Harvey contributes articles to selected WINs.


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 SECTION I - Current Intelligence

            Chasing Bin Laden

            Total Information Awareness

 SECTION II - Context and Precedence

            Defense "Covert Ops" Role

            Three Decades of North Korean Spying

            'Vice President Cheney on Intelligence Analysis

 SECTION III - Cyber Intelligence

            Hacker of Military Networks Caught

            Sweden Expels Two Russian Diplomats for Ericsson Spying

            Big Bucks for Cyber Security Research

            Quantum Encryption is Coming

            The Myth of Cyber Terrorism

 SECTION IV - Books and Sources

            Espionage Against the United States by American Citizens 1947 - 2001- by Herbig and Wiskoff

            DIA and State Department Global Threat Responses

 SECTION V - Announcements and Notes

            In Memoriam - Natalie Grant Wraga

            Sidney Reilly Redux



 CHASING BIN LADEN -- The recent political and media reactions to the taped interview purporting to be of Osama bin Laden have raised the question of what the US is doing to find the al Qaeda leaders. It is doubtful that those who rail at the lack of more rapid successes understand (or, too frequently, even care) the magnitude of the problems and the scope and nature of the international intelligence, reconnaissance and surveillance searches. In the Arabian Sea, the coalition of the US and eight allies are intercepting hundreds of vessels in the search for the terrorists. Since December, ships or reconnaissance aircraft from Canada, Germany, the Netherlands, Spain, Greece, the UK, France, Italy and the US have helped capture four suspected al Qaeda leaders during 357 boardings. Ten ships participate in the operation, with Canada in command. Some 25 allied reconnaissance aircraft provide 24-hour daily coverage of the region in search of oil smugglers as well as suspected terrorists. Through early November, the coalition has issued 23,954 radio queries, or "challenges," to suspect ships, asking their identity, cargo, names of crew and destination. The information is matched against a database built from intelligence and maritime information on known smugglers and from documents and interrogations of captured al Qaeda and Taliban leaders.

            In the Afghanistan/Pakistan region ashore, the global hunt involves small teams of military, CIA and FBI field operators chasing leads amid indifferent or sometimes hostile Muslim populations. Navy SEAL Team 6 and Army Delta Force elite personnel as well as CIA personnel have been involved in the hunt for the al Qaeda leaders for more than a year. One DoD counter-terrorism advisor has said the number of military and CIA personnel devoted full time to finding bin Laden probably does not exceed 30 people. Law enforcement officials in Washington indicate that the FBI has about two dozen agents in the Afghanistan/Pakistan region to assist the military and the CIA. About half of the FBI contingent, are crime laboratory personnel with expertise in forensic analysis and evidence gathering with separate groups assigned to the Pakistani police force and the US teams conducting tracking missions. Internal political realities in Pakistan and the tribal hostility in western Pakistan to any outsiders, including the Pakistan military, as well as the difficulty of introducing Americans who can blend into the background provide little opportunity to conduct a successful sweep to find the al Qaeda leaders.

            The counterterrorism war was advertised from the beginning to be a long, arduous struggle, correctly it would seem. (Harvey) (Bloomberg.com 14 Nov '02 // T. Capaccio) ( USA Today 14 Nov '02, pg. 4 // J. Diamond and D. Moniz)

 TOTAL INFORMATION AWARENESS -- The Defense Advanced Research Projects Agency (DARPA) is working to create a prototype new computer monitoring system known as "Total Information Awareness" that would search for terrorists by probing through networked databases of private "transactional" information. "If terrorist organizations are going to plan and execute attacks against the United States, their people must engage in transactions and they will leave signatures in this information space," said (Adm, ret) John Poindexter, director of DARPA's Information Awareness Office. The project has raised concerns about the long term effects of such a system on our liberty as envisioned in the constitution. For the short term, however, given the requirements of the war on terrorism, it makes eminent sense. (Jonkers) (Secrecy News 112, 11 Nov 02) (NY Times 9 Nov 02 //J. Markoff)  http://www.nytimes.com/2002/11/09/politics/09COMP.html  http://www.fas.org/irp/agency/dod/poindexter.html


 DEFENSE "COVERT OPS" ROLE -- A 78-page briefing document recently obtained by the media titled "Summer Study on Special Operations and Joint Forces in Support of Countering Terrorism" and produced by a 10-member panel of military experts [only AFIO member Admiral William Studeman, former DIRNSA, former Deputy DCI and former Acting DCI was identified as a member] under the auspices of the Defense Science Board advocates a greatly expanded and more assertive role for covert military actions, intelligence collection and operations to "stimulate reactions" among terrorists and states possessing weapons of mass destruction. In discussing the report, not yet forwarded to the President, the DSB chairman, William Schneider Jr., rejected concerns that the proposal would usurp CIA's covert operations role, erode congressional oversight, or change long-standing policies such as prohibition of assassinations. Expansion of existing covert units and the addition of new covert units in all of the Services as well as the new expenditure of billions of dollars was called for. The panel recommended a number of new or morphed organizations in the design to bring together CIA and military covert action, information warfare, psychological warfare, intelligence, cover and deception.

            The proposed organization(s) would incorporate and expand existing military covert capabilities for the preparation, training and execution of anti-terrorist operations with the NSC doing the planning. The Army's highly compartmentalized Intelligence Support Activity, established in 1981 and now known as Gray Fox, anti-terror and intelligence collection capabilities would be included in the postulated hierarchy. One recommendation calls for the creation of a "Proactive Preemptive Operating Group" (P2OG) that would oversee missions involving special forces, psychological warfare experts and other covert operations. One aim would be to "improve information collection by stimulating reactions" among intelligence targets. The intent of the new organizations would be to hold "states/sub-state actors accountable" and "signal to harboring states that their sovereignty will be at risk" according to the panel's briefing paper.

            Overall, an outside observer can develop the impression that a myriad of new organizations are proposed to assume the current duties of older units and post-9/11 anti-terror organizations. It probably is the manner in which the press has summarized the lengthy report, but a first reaction to the obviously necessary expansion and better coordination of US anti-terror measures being postulated in the report is that a formidable bureaucracy is to accompany the improvements.(Harvey) (LA Times 26 Oct '02, pg. 1, //G. Miller) ( LA Times 27 Oct '02 //W. Arkin)


THREE DECADES OF NORTH KOREAN SPYING -- .For decades, North Korea has operated "spy" ships between five to12 times a year in Japanese coastal waters, disgorging smaller boats, which in turn launched rubber rafts to take agents (about 100 annually) to Japan's coast and to pick them up. Last December (2001), the Japanese engaged such a mission in a gun battle and sank the vessel.. To learn what it could about the craft and its use, Japan spent $50 million raising the vessel in September '02. It was disguised as a civilian craft but was military, complete with mounted guns and two doors in its hull from which to launch and retrieve a 33-foot high-powered speedboat equipped with a Japanese cell phone and two Japanese-made rubber rafts.

            A detailed analysis of the North Korean espionage campaign by a Washington newspaper incorporated data from the captured ship, Japanese interviews with people kidnapped from Japan by North Korean agents, old reexamined cases, imprisoned North Korean agents, ethnic Koreans living in Japan, and various analysts in Japan.    In general, the North Korean espionage was designed to build a network to gain intelligence, money and influence in Japan, and through Japan, in South Korea. Some accounts indicate the espionage was aimed more at learning about South Korea than Japan. The agents were on the prowl for politicians whose votes could be bought, journalists and scholars whose opinions could be swayed, businessmen who could contribute money and provide a cover, and even tourists who would go to South Korea and report back on what they saw. Pyongyang orders to sympathizers in Japan were carried by the agents. Japanese authorities also suspect the agents smuggled drugs and passed counterfeit bills. The agents were apparently proficient at snatching Japanese off the beach on the way out and taking them back to North Korea.

            Apart from the abductions, the agents in Japan rarely harmed anyone. The "secrets" they brought back to Pyongyang were mostly from textbooks or guides bought in bookstores. Evoking memories of World War II espionage, one agent was trained to listen to Radio Pyongyang at midnight on a shortwave radio, copy numbers broadcast on the station, and decipher messages using a copy of the book Don Quixote. He had an easy time communicating with Pyongyang since all he had to do was write out his reports and send a letter through the Japanese postal system. The agents were able to take advantage of the more than 110, 000 Koreans in Japan officially registered as North Korean citizens. Some travel regularly to North Korea by ferry from Japan and for years have been a source of income and political support for Pyongyang.

            While the emerging picture of the long-time espionage campaign is far from complete, the impression is that it should have done much better than been indicated thus far. It could be that the usually latent but ever-present animosity between the Koreans and the Japanese served as a handicap.(Harvey) (WashPost 13 Oct 02, p. A24 //D. Struck)

VICE PRESIDENT CHENEY ON INTELLIGENCE ANALYSIS -- "As we began the Presidential transition some two years ago, [Deputy Director for Intelligence] Jami Miscik came into my office with a CIA briefing. Since then, the President and I have begun every day, whether at home or abroad, with a CIA briefing. I probably spend more time with George Tenet than he spends with his own family. And that's as it should be...." (laughter)

            "For years, analysis informed the decisions that kept the Cold War from turning into a hot war, and helped lead to the Soviet Union's demise. Today, the nature of the threat to our country has changed dramatically and the challenge to you in many ways is even more formidable. ... As the President has said many times, we have entered a different kind of war, which we fight with many tools: diplomacy, law enforcement, financial influence, and military power. And the effective use of all of these tools requires superior intelligence and analytic work—a product that is insightful, accurate, and timely.

            Much is asked of you. We rely on your expertise as analysts to sort through enormous volumes of information and put together the pieces of some very important and complex puzzles. We also rely on you to point out where you have doubts, to admit what you don't know, and to question your own conclusions. We will look to you for new ideas and for actions that reflect the highest principles of the American people....." (Jonkers) (VP Cheney at CIA, for fiftieth Anniversary of the Intelligence Directorate) (12 Nov 02)


 HACKER OF MILITARY NETWORKS CAUGHT -- Federal authorities have cracked the case of a hacker who broke into roughly 100 unclassified U.S. military networks over the past year. Officials declined to identify the hacker, a British citizen, but said he could be indicted as early as Tuesday in federal courts in northern Virginia and New Jersey. (Levine's Newsbits, 12 Nov 02) (http://www.timesdispatch.com/news/vaapwire/MGBND200F8D.html)(http://www.latimes.com/technology/la-na-briefs12.5nov12,0,1335980.story)

 SWEDEN EXPELS TWO RUSSIAN DIPLOMATS FOR ERICSSON SPYING -- Sweden has expelled two Russian diplomats in connection with a spying scandal at telecoms equipment maker Ericsson. (http://www.siliconvalley.com/mld/siliconvalley/news/editorial/4493503.htm)(http://www.nandotimes.com/technology/story/615524p-4738959c.html)

 BIG BUCKS FOR CYBER SECURITY RESEARCH -- Congress approved $903 million in grants to spur federal agencies, industry and universities to devote more energy to cyber security research." For too long, cyber security has just not been a research priority," said Rep. Sherwood Boehlert, R-N.Y., chairman of the House Science Committee and sponsor of the legislation. (http://www.wired.com/news/business/0,1367,56329,00.html)(http://www.nandotimes.com/technology/story/617249p-4748581c.html)(http://www.usatoday.com/tech/news/techpolicy/2002-11-12-cyber-security_x.htm)

 QUANTUM ENCRYPTION IS COMING -- Quantum encryption pioneers promise to put the world's first uncrackably secure networks online by early 2003. Based on the quantum properties of photons, quantum encryption guarantees absolutely secure optical communications. (Levine 12 Nov 02)  http://www.eetimes.com/at/news/OEG20021111S0036

 THE MYTH OF CYBER TERRORISM -- While computer security needs to be an everyday concern for anyone who transmits or maintains valuable data online, "cyber terrorism" is a word that has no right to exist. "There is no such thing as cyber terrorism," writes Joshua Green. There is "no instance of anyone ever having been killed by a terrorist (or anyone else) using a computer." Green's article "The Myth of Cyberterrorism" in the November 2002 Washington Monthly marks the growing skepticism about the prospects of an "electronic Pearl Harbor" and echoes a critique that has been voiced notably by George Smith of The Crypt Newsletter for years. (Levine 12 Nov 02) (http://www.washingtonmonthly.com/features/2001/0211.green.html)


 ESPIONAGE AGAINST THE UNITED STATES BY AMERICAN CITIZENS 1947 - 2001, by Katherine L. Herbig and Martin F. Wiskoff, may be viewed at http://www.ncix.gov/news/index.html. The study, dated July 2002 and released this week by the Defense Personnel Security Research Center (PERSEREC) in Monterey, California, is based on an open source analysis of 150 cases of espionage against the United States committed since 1947. The authors state that since the end of the Cold War in 1991,... characteristics of American spies have changed. "Americans who began spying during the 1990s have been older, with a median age of 39, and more demographically heterogeneous, with more women and more ethnic minorities." The new spies tend to be civilian rather than military, are more likely to volunteer than to be recruited, are more likely to be naturalized citizens, and are more likely to have foreign attachments. In one finding with particular relevance for security policy, the report stated that "Very few people apply for access to classified information intending to commit espionage." It follows that "optimal use of personnel security resources for countering espionage would focus more on periodic reevaluation and continuing assessment of experienced cleared personnel," rather than intensive focus on new applicants.

            Questions regarding this 135 page report should be directed to PERSEREC at perserec@osd.pentagon.mil. The report can also be accessed in FAS Secrecy News report #108, http://www.fas.org/sgp/library/spies.pdf . (Jonkers)


DIA and STATE DEPARTMENT GLOBAL THREAT RESPONSES -- Newly published responses to questions from the Senate Intelligence Committee address a wide range of global security concerns.

For DIA responses, see: http://www.fas.org/irp/congress/2002_hr/020602dia.html

For State Department responses, see http://www.fas.org/irp/congress/2002_hr/020602dos.html

These items were published two weeks ago in the Hearing record of the February 6, 2002, Senate Intelligence Committee hearing on "The Worldwide Threat in 2002." (Jonkers) (FAS Secrecy News #108, dtd 29 Oct02)


IN MEMORIAM - NATALIE GRANT WRAGA, expert on Soviet deception, and particularly on a Soviet operation called "The Trust" in the 1920's and 1030's, which conveyed false information to enemy intelligence services and anti-Stalin emigrants, died November 12th at her home in Lovettsville. She was born in 1901 as Natalia Konstantinovna Mark, in Talinn, Estonia, then a part of Czarist Russia. Her father was a judge. The family was able to flee Russia before the Bolshevik revolution of 1917. Natalie learned English and French from governesses, and her language proficiency helped her get a job with the American Relief Administration, a post-WWII humanitarian effort. During the turbulent 1920's she met and married Malcolm Grant; worked alongside diplomat George F. Kennan at the American legation in Riga, Latvia, where she was for 11 years; divorced Grant and married a high-ranking Polish intelligence official, Richard Wraga; was a political officer at the US Embassy in Switzerland during WWII; and served as a Sovietologist at the State Department in the 1950's and at the Hoover Institution at Stanford University in the 1960's.

            Natalie Grant was a voice of realism whose voice contested, and was often drowned by advocates of ideological preconceptions about communism, a petite woman with a strong mind and message, who lived a full life to a ripe old age. Her message remains applicable today in our war with al Quada and terrorists. "Propaganda is obvious to anybody with any brains, but disinformation is not. Sometimes more than 90 percent of the content of disinformation is true. The thing that is important is to find the part that is false. Sometimes that can be one word."

            As an old PsyWar officer I am not so sure she was right about propaganda, but she certainly was 'right on' with the disinformation message. In her honor I will reprint in 'The Intelligencer' an article she wrote for me as Editor of another journal some years ago. (Jonkers) (Washingtonpost.com, 15 Nov 02 //p. B07 //A. Bernstein)

SIDNEY REILLY REDUX -- Tangentially relevant to Natalie Wraga's passing, at least in terms of their common battle against bolshevism, is the secret MI5 file released on Sidney Reilly, Britain's "Ace of spies," in May of this year. The file released by British intelligence reinforces the conclusion that Sidney Reilly, Britain's ''Ace of Spies,'' was executed by undercover Soviet police in 1925.

            Born the illegitimate son of a Jewish doctor in Odessa in 1874, Reilly changed his name from Sigmund Rosenblum to Sidney George Reilly when the family went to Britain, where he was educated and became involved in espionage. Reilly's reputed exploits ranged from saving diplomats in the jungles of South America to obtaining German naval secrets for Britain.   After 1917 one of his main goals was to topple the Bolshevik regime. He is believed to have secretly entered the Soviet Union five times, until he was arrested and reportedly executed in November 1925 (shortly before Joseph Stalin came to power), when the secret police was unable to turn him into a double agent.

            Reilly reputedly made and lost several fortunes during his life, and had many love affairs and several wives. He came as close to a real-life James Bond as one can be, without the personal combat scenes. His story was popularized in the TV miniseries ''Reilly, Ace of Spies'' in Britain and the United States in 1983/84 (available for purchase from PBS). His life is one of legend and conflicting stories, and remains mysterious. Gordon Brook-Shepherd's book ''Iron Maze,'' which portrayed efforts by Allied secret services to topple the Bolshevik regime, provides the most credible evidence. The Reilly file released by the MI5, which contained many typed and handwritten documents, appeared to confirm the book's account. By whatever account, this legendary figure of espionage and intrigue fought the good fight against the communist dictatorship. We need similar talents and guts in the fight against terrorism. (Jonkers) (AP 5/9/02 //T. Wagner) (courtesy Dr. C. Kiracofe) (http://www.boston.com/dailynews/129/world/Reported_Soviet_execution_of_B:.shtml)

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