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Paul Merrell

Rapid - Press Releases - EUROPA - 0 views

  • The Commission found that Intel engaged in two specific forms of illegal practice. First, Intel gave wholly or partially hidden rebates to computer manufacturers on condition that they bought all, or almost all, their x86 CPUs from Intel. Intel also made direct payments to a major retailer on condition it stock only computers with Intel x86 CPUs. Such rebates and payments effectively prevented customers - and ultimately consumers - from choosing alternative products. Second, Intel made direct payments to computer manufacturers to halt or delay the launch of specific products containing competitors’ x86 CPUs and to limit the sales channels available to these products.
  • Intel awarded major computer manufacturers rebates on condition that they purchased all or almost all of their supplies, at least in certain defined segments, from Intel: Intel gave rebates to computer manufacturer A from December 2002 to December 2005 conditional on this manufacturer purchasing exclusively Intel CPUs Intel gave rebates to computer manufacturer B from November 2002 to May 2005 conditional on this manufacturer purchasing no less than 95% of its CPU needs for its business desktop computers from Intel (the remaining 5% that computer manufacturer B could purchase from rival chip maker AMD was then subject to further restrictive conditions set out below) Intel gave rebates to computer manufacturer C from October 2002 to November 2005 conditional on this manufacturer purchasing no less than 80% of its CPU needs for its desktop and notebook computers from Intel Intel gave rebates to computer manufacturer D in 2007 conditional on this manufacturer purchasing its CPU needs for its notebook computers exclusively from Intel.
  • Furthermore, Intel made payments to major retailer Media Saturn Holding from October 2002 to December 2007 on condition that it exclusively sold Intel-based PCs in all countries in which Media Saturn Holding is active.
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  • In its decision, the Commission does not object to rebates in themselves but to the conditions Intel attached to those rebates.
  • Intel structured its pricing policy to ensure that a computer manufacturer which opted to buy AMD CPUs for that part of its needs that was open to competition would consequently lose the rebate (or a large part of it) that Intel provided for the much greater part of its needs for which the computer manufacturer had no choice but to buy from Intel. The computer manufacturer would therefore have to pay Intel a higher price for each of the units supplied for which the computer manufacturer had no alternative but to buy from Intel. In other words, should a computer manufacturer fail to purchase virtually all its x86 CPU requirements from Intel, it would forego the possibility of obtaining a significant rebate on any of its very high volumes of Intel purchases. Moreover, in order to be able to compete with the Intel rebates, for the part of the computer manufacturers' supplies that was up for grabs, a competitor that was just as efficient as Intel would have had to offer a price for its CPUs lower than its costs of producing those CPUs, even if the average price of its CPUs was lower than that of Intel.
  • For example, rival chip manufacturer AMD offered one million free CPUs to one particular computer manufacturer. If the computer manufacturer had accepted all of these, it would have lost Intel's rebate on its many millions of remaining CPU purchases, and would have been worse off overall simply for having accepted this highly competitive offer. In the end, the computer manufacturer took only 160,000 CPUs for free.
  • Intel also interfered directly in the relations between computer manufacturers and AMD. Intel awarded computer manufacturers payments - unrelated to any particular purchases from Intel - on condition that these computer manufacturers postponed or cancelled the launch of specific AMD-based products and/or put restrictions on the distribution of specific AMD-based products. The Commission found that these payments had the potential effect of preventing products for which there was a consumer demand from coming to the market. The Commission found the following specific cases: For the 5% of computer manufacturer B’s business that was not subject to the conditional rebate outlined above, Intel made further payments to computer manufacturer B provided that this manufacturer : sold AMD-based business desktops only to small and medium enterprises sold AMD-based business desktops only via direct distribution channels (as opposed to through distributors) and postponed the launch of its first AMD-based business desktop in Europe by 6 months. Intel made payments to computer manufacturer E provided that this manufacturer postponed the launch of an AMD-based notebook from September 2003 to January 2004. Before the conditional rebate to computer manufacturer D outlined above, Intel made payments to this manufacturer provided that it postponed the launch of AMD-based notebooks from September 2006 to the end of 2006.
  • The Commission obtained proof of the existence of many of the conditions found to be illegal in the antitrust decision even though they were not made explicit in Intel’s contracts. Such proof is based on a broad range of contemporaneous evidence such as e-mails obtained inter alia from unannounced on-site inspections, in responses to formal requests for information and in a number of formal statements made to the Commission by the other companies concerned. In addition, there is evidence that Intel had sought to conceal the conditions associated with its payments.
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    This is an uncharacteristically strong press release from DG Competition. I still must read the order, but the description of the evidence is incredible, particularly the finding of concealment of its rebate conditions by Intel.
Paul Merrell

Rapid - Press Releases - EUROPA - 0 views

  • The Commission has found that Intel excluded its competitor in two ways: through illegal loyalty rebates by paying manufacturers and retailers to restrict the commercialisation of competitors' products.These illegal actions were designed to preserve Intel's market share at a time when their only significant rival - AMD - was a growing threat to Intel's position. This threat was widely recognised by both computer manufacturers and in Intel's own internal documents seen by the Commission. The computer manufacturers involved are Acer, Dell, HP, Lenovo and NEC. The retailer involved is Media Saturn Holdings, the parent company of Media Markt.
  • Naturally, the Commission favours strong, vigorous price competition, including by dominant firms. However, Intel went beyond normal price competition by giving rebates to computer manufacturers on the condition that they bought all, or almost all, of their CPUs from Intel. Intel also made direct payments to a major retailer – Media Markt - on the condition that it stocked only computers with Intel CPUs.
  • Just to give you one example: in one case, a computer manufacturer took up only a small part of an offer by AMD of free CPUs because acceptance of all the free CPUs offered would have led that computer manufacturer to breach the conditions of its agreement with Intel and to lose rebates on all its much more numerous Intel purchases.
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  • Intel made direct payments to computer manufacturers to halt or delay the launch of products using their rival's chips, and to limit their distribution once available. The Commission has specific, documented examples, of Intel paying other manufacturers to, for example, delay the launch of an AMD-based PC by six months, and to restrict the sales of AMD-based products to certain customers.
  • The Commission Decision contains evidence that Intel went to great lengths to cover-up many of its anti-competitive actions. Many of the conditions mentioned above were not to be found in Intel’s official contracts. However, the Commission was able to gather a broad range of evidence demonstrating Intel's illegal conduct through statements from companies, on-site inspections, and formal requests for information.
  • Finally, I would like to draw your attention to Intel's latest global advertising campaign which proposes Intel as the "Sponsors of Tomorrow." Their website invites visitors to add their 'vision of tomorrow'. Well, I can give my vision of tomorrow for Intel here and now: "obey the law".
Paul Merrell

European Union fines Intel a record $1.45 billion - Los Angeles Times - 0 views

  • European regulators today levied a record antitrust fine of $1.45 billion against Intel. Corp. for abusing its position as the world's dominant computer chip maker. The fine comes after nearly two years of investigation by the European Commission into allegations that the Santa Clara company offered improper rebates and other discounts to discourage companies from buying microprocessors from its smaller rival, Advanced Micro Devices Inc. Complaints from AMD triggered the case.
  • The fine tops the $1.23-billion fine European regulators levied against Microsoft Corp. last year for abusing its dominant position in computer software.
  • "Intel takes strong exception to this decision. We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace – characterized by constant innovation, improved product performance and lower prices. There has been absolutely zero harm to consumers. Intel will appeal."
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  • The European ruling, which had been expected in recent days, comes as the U.S. Federal Trade Commission continues its own antitrust investigation against Intel, which was opened in June 2008. AMD also has sued Intel in federal court.
  • "The relief that the Europeans imposed I think will provide an excellent guide to U.S. enforcers as they try to determine what to do about Intel's exclusionary conduct," Balto said today.
Paul Merrell

Los Angeles Times - latimes.com - 0 views

  • The Obama administration put large companies on notice that it would be tougher on mergers and attempts to stifle competition, restoring the type of aggressive antitrust enforcement of the 1990s that led to the landmark government case against Microsoft Corp.
  • Among those likely to feel the heat of federal inquiries are technology companies, such as chip maker Intel Corp., Internet giant Google Inc. and longtime tech leader IBM Corp.
Paul Merrell

The antitrust thing that won't blow over | Here we go again | The Economist - 0 views

  • Google, the industry’s newest giant, is also coming under closer scrutiny. On April 29th it emerged that America’s Justice Department is examining whether Google’s settlement with authors and publishers over its book-search service violates antitrust laws; and on May 5th the Federal Trade Commission (FTC) launched a probe to see whether Google’s sharing of two board members with Apple reduces competition between the two firms.
  • Similarly, antitrust lobbying is part of a broader “platform war” for IBM, which hopes thereby to keep Microsoft at bay. Among other things, IBM is a sponsor of the European Committee for Interoperable Systems (ECIS), which has many of Microsoft’s other competitors as its members and is one of the prime movers behind the new browser case. It started in late 2007 with a complaint by Opera, a Norwegian browser-maker and ECIS member. Not to be outdone, Microsoft has entered the antitrust game, too. It recently made an investment in T3, a small vendor of mainframe-like computers, which in January lodged a complaint with the European Commission, alleging that IBM kept it from competing by refusing to license mainframe software to T3’s customers. Microsoft has also lobbied American antitrust regulators to tackle Google, encouraging them to look into an online-advertising deal between the search giant and its rival, Yahoo!, which was eventually abandoned.
  • IBM, for its part, would appear to have little to fear. It is hard to argue, with so many different computer systems around, that mainframes still constitute a separate market—a necessary condition if IBM’s behaviour is to be judged anticompetitive.
Paul Merrell

Vodafone reveals existence of secret wires that allow state surveillance | Business | T... - 0 views

  • Vodafone, one of the world's largest mobile phone groups, has revealed the existence of secret wires that allow government agencies to listen to all conversations on its networks, saying they are widely used in some of the 29 countries in which it operates in Europe and beyond.The company has broken its silence on government surveillance in order to push back against the increasingly widespread use of phone and broadband networks to spy on citizens, and will publish its first Law Enforcement Disclosure Report on Friday. At 40,000 words, it is the most comprehensive survey yet of how governments monitor the conversations and whereabouts of their people.The company said wires had been connected directly to its network and those of other telecoms groups, allowing agencies to listen to or record live conversations and, in certain cases, track the whereabouts of a customer. Privacy campaigners said the revelations were a "nightmare scenario" that confirmed their worst fears on the extent of snooping.
  • Vodafone's group privacy officer, Stephen Deadman, said: "These pipes exist, the direct access model exists."We are making a call to end direct access as a means of government agencies obtaining people's communication data. Without an official warrant, there is no external visibility. If we receive a demand we can push back against the agency. The fact that a government has to issue a piece of paper is an important constraint on how powers are used."Vodafone is calling for all direct-access pipes to be disconnected, and for the laws that make them legal to be amended. It says governments should "discourage agencies and authorities from seeking direct access to an operator's communications infrastructure without a lawful mandate".
  • In America, Verizon and AT&T have published data, but only on their domestic operations. Deutsche Telekom in Germany and Telstra in Australia have also broken ground at home. Vodafone is the first to produce a global survey.
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  • Peter Micek, policy counsel at the campaign group Access, said: "In a sector that has historically been quiet about how it facilitates government access to user data, Vodafone has for the first time shone a bright light on the challenges of a global telecom giant, giving users a greater understanding of the demands governments make of telcos. Vodafone's report also highlights how few governments issue any transparency reports, with little to no information about the number of wiretaps, cell site tower dumps, and other invasive surveillance practices."
  • Snowden, the National Security Agency whistleblower, joined Google, Reddit, Mozilla and other tech firms and privacy groups on Thursday to call for a strengthening of privacy rights online in a "Reset the net" campaign.Twelve months after revelations about the scale of the US government's surveillance programs were first published in the Guardian and the Washington Post, Snowden said: "One year ago, we learned that the internet is under surveillance, and our activities are being monitored to create permanent records of our private lives – no matter how innocent or ordinary those lives might be. Today, we can begin the work of effectively shutting down the collection of our online communications, even if the US Congress fails to do the same."
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    The Vodafone disclosures will undoubtedly have a very large ripple effect. Note carefully that this is the first major telephone service in the world to break ranks with the others and come out swinging at secret government voyeur agencies. Will others follow. If you follow the links to the Vodafone report, you'll find a very handy big PDF providing an overview of the relevant laws in each of the customer nations. There's a cute Guardian table that shows the aggregate number of warrants for interception of content via Vodafone for each of those nations, broken down by content type. That table has white-on-black cells noting where disclosure of those types of surveillance statistics are prohibited by law. So it is far from a complete picture, but it's a heck of a good start.  But several of those customer nations are members of the E.U., where digital privacy rights are enshrined as human rights under an EU-wide treaty. So expect some heat to roll downhill on those nations from the European treaty organizations, particularly the European Court of Human Rights, staffed with civil libertarian judges, from which there is no appeal.     
Paul Merrell

F.B.I. Director to Call 'Dark' Devices a Hindrance to Crime Solving in a Policy Speech ... - 0 views

  • In his first major policy speech as director of the F.B.I., James B. Comey on Thursday plans to wade deeper into the debate between law enforcement agencies and technology companies about new programs intended to protect personal information on communication devices.Mr. Comey will say that encryption technologies used on these devices, like the new iPhone, have become so sophisticated that crimes will go unsolved because law enforcement officers will not be able to get information from them, according to a senior F.B.I. official who provided a preview of the speech.The speech was prompted, in part, by the new encryption technology on the iPhone 6, which was released last month. The phone encrypts emails, photos and contacts, thwarting intelligence and law enforcement agencies, like the National Security Agency and F.B.I., from gaining access to it, even if they have court approval.
  • The F.B.I. has long had concerns about devices “going dark” — when technology becomes so sophisticated that the authorities cannot gain access. But now, Mr. Comey said he believes that the new encryption technology has evolved to the point that it will adversely affect crime solving.He will say in the speech that these new programs will most severely affect state and local law enforcement agencies, because they are the ones who most often investigate crimes like kidnappings and robberies in which getting information from electronic devices in a timely manner is essential to solving the crime.
  • They also do not have the resources that are available to the F.B.I. and other federal intelligence and law enforcement authorities in order to get around the programs.Mr. Comey will cite examples of crimes that the authorities were able to solve because they gained access to a phone.“He is going to call for a discussion on this issue and ask whether this is the path we want to go down,” said the senior F.B.I. official. “He is not going to accuse the companies of designing the technologies to prevent the F.B.I. from accessing them. But, he will say that this is a negative byproduct and we need to work together to fix it.”
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  • Mr. Comey is scheduled to give the speech — titled “Going Dark: Are Technology, Privacy and Public Safety on a Collision Course?” — at the Brookings Institution in Washington.
  • In the interview that aired on “60 Minutes” on Sunday, Mr. Comey said that “the notion that we would market devices that would allow someone to place themselves beyond the law troubles me a lot.”He said that it was the equivalent of selling cars with trunks that could never be opened, even with a court order.“The notion that people have devices, again, that with court orders, based on a showing of probable cause in a case involving kidnapping or child exploitation or terrorism, we could never open that phone?” he said. “My sense is that we've gone too far when we've gone there.”
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    I'm informed that Comey will also call for legislation outlawing communication by whispering because of technical difficulties in law enforcement monitoring of such communications. 
Paul Merrell

Between the Lines of the Cellphone Privacy Ruling - NYTimes.com - 0 views

  • In a pathbreaking case on Fourth Amendment privacy rights and modern technology, the Supreme Court unanimously ruled that the police must obtain warrants before searching the digital contents of cellphones taken from people who are placed under arrest. Here are some key points in the opinion by Chief Justice John G. Roberts Jr. and a concurrence by Justice Samuel Alito.
Paul Merrell

U.S. Says It Spied on 89,000 Targets Last Year, But the Number Is Deceptive | Threat Le... - 0 views

  • About 89,000 foreigners or organizations were targeted for spying under a U.S. surveillance order last year, according to a new transparency report. The report was released for the first time Friday by the Office of the Director of Intelligence, upon order of the president, in the wake of surveillance leaks by NSA whistleblower Edward Snowden. But the report, which covers only surveillance orders issued in 2013, doesn’t tell the whole story about how many individuals the spying targeted or how many Americans were caught in the surveillance that targeted foreigners. Civil liberties groups say the real number is likely “orders of magnitude” larger than this. “Even if it was an honest definition of ‘target’—that is, an individual instead of a group—that also is not encompassing those who are ancillary to a target and are caught up in the dragnet,” says Kurt Opsahl, deputy general counsel of the Electronic Frontier Foundation.
  • The report, remarkably, shows that the government obtained just one order last year under Section 702 of FISA—which allows for bulk collection of data on foreigners—and that this one order covered 89,138 targets. But, as the report notes, “target” can refer to “an individual person, a group, an organization composed of multiple individuals or a foreign power that possesses or is likely to communicate foreign intelligence information.” Furthermore, Section 702 orders are actually certificates issued by the FISA Court that can cover surveillance of an entire facility. And since, as the government points out in its report, the government cannot know how many people use a facility, the figure only “reflects an estimate of the number of known users of particular facilities (sometimes referred to as selectors) subject to intelligence collection under those Certifications,” the report notes.
  • “If you’re actually trying to get a sense of the number of human beings affected or the number of Americans affected, the number of people affected is vastly, vastly larger,” says Julian Sanchez, senior fellow at the Cato Institute. “And how many of those are Americans is impossible to say. But [although] you may not think you are routinely communicating with foreign persons, [this] is not any kind of assurance that your communications are not part of the traffic subject to interception.” Sanchez points out that each individual targeted is likely communicating with dozens or hundred of others, whose communications will be picked up in the surveillance. “And probably a lot of these targets are not individuals but entire web sites or companies. While [a company like the Chinese firm] Huawei might be a target, thousands of emails used by thousands of employees will be swept up.” How many of those employees might be American or communicating with Americans is unknown.
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  • Also revealed in today’s report is the number of times the government has queried the controversial phone records database it created by collecting the phone records of every subscriber from U.S. providers. According to the report, the government used 423 “selectors” to search its massive phone records database, which includes records going back to at least 2006 when the program began. A search involves querying a specific phone number or device ID that appears in the database. The government has long maintained that its collection of phone records isn’t a violation of its authority, since it only views the records of specific individuals targeted in an investigation. But such searches, even if targeted at phone numbers used by foreigners, would include calls made to and from Americans as well as calls exchanged with people two or three hops out from the targeted number.
  • In its report, the government indicated that the 423 selectors involved just 248 “known or presumed” Americans whose information was collected by the agency in the database. But Opsahl says that both of these numbers are deceptive given what we know about the database and how it’s been used. “We know it’s affecting millions of people,” he points out. But “then we have estimated numbers of affected people [that are just] in the three digits. That requires some effort [on the government's part] to find a way to do the definition of the number [in such a way] to make it as small as possible.”
  • One additional figure today’s report covers is the number of National Security Letters the government issued last year to businesses to obtain data on accountholders and users—19,212. NSLs are written demands from the FBI that compel internet service providers, credit companies, financial institutions and others to hand over confidential records about their customers, such as subscriber information, phone numbers and e-mail addresses, websites visited, and more. These letters are a powerful tool because they do not require court approval, and they come with a built-in gag order, preventing recipients from disclosing to anyone that they have received an NSL. An FBI agent looking into a possible anti-terrorism case can self-issue an NSL to a credit bureau, ISP, or phone company with only the sign-off of the Special Agent in Charge of their office. The FBI has merely to assert that the information is “relevant” to an investigation into international terrorism or clandestine intelligence activities.
  • The FBI has issued hundreds of thousands of NSLs over the years and has been reprimanded for abusing them. Last year a federal judge ruled that the use of NSLs is unconstitutional, due to the gag order that accompanies them, and ordered the government to stop using them. Her ruling, however, was stayed pending the government’s appeal.
  • According to the government’s report today, the 19,000 NSLs issued last year involved more than 38,000 requests for information.
Paul Merrell

Visit the Wrong Website, and the FBI Could End Up in Your Computer | Threat Level | WIRED - 0 views

  • Security experts call it a “drive-by download”: a hacker infiltrates a high-traffic website and then subverts it to deliver malware to every single visitor. It’s one of the most powerful tools in the black hat arsenal, capable of delivering thousands of fresh victims into a hackers’ clutches within minutes. Now the technique is being adopted by a different kind of a hacker—the kind with a badge. For the last two years, the FBI has been quietly experimenting with drive-by hacks as a solution to one of law enforcement’s knottiest Internet problems: how to identify and prosecute users of criminal websites hiding behind the powerful Tor anonymity system. The approach has borne fruit—over a dozen alleged users of Tor-based child porn sites are now headed for trial as a result. But it’s also engendering controversy, with charges that the Justice Department has glossed over the bulk-hacking technique when describing it to judges, while concealing its use from defendants. Critics also worry about mission creep, the weakening of a technology relied on by human rights workers and activists, and the potential for innocent parties to wind up infected with government malware because they visited the wrong website. “This is such a big leap, there should have been congressional hearings about this,” says ACLU technologist Chris Soghoian, an expert on law enforcement’s use of hacking tools. “If Congress decides this is a technique that’s perfectly appropriate, maybe that’s OK. But let’s have an informed debate about it.”
  • The FBI’s use of malware is not new. The bureau calls the method an NIT, for “network investigative technique,” and the FBI has been using it since at least 2002 in cases ranging from computer hacking to bomb threats, child porn to extortion. Depending on the deployment, an NIT can be a bulky full-featured backdoor program that gives the government access to your files, location, web history and webcam for a month at a time, or a slim, fleeting wisp of code that sends the FBI your computer’s name and address, and then evaporates. What’s changed is the way the FBI uses its malware capability, deploying it as a driftnet instead of a fishing line. And the shift is a direct response to Tor, the powerful anonymity system endorsed by Edward Snowden and the State Department alike.
Gonzalo San Gil, PhD.

EFF's Game Plan for Ending Global Mass Surveillance | Electronic Frontier Foundation - 0 views

  • We have a problem when it comes to stopping mass surveillance.  The entity that’s conducting the most extreme and far-reaching surveillance against most of the world’s communications—the National Security Agency—is bound by United States law.  That’s good news for Americans. U.S. law and the Constitution protect American citizens and legal residents from warrantless surveillance. That means we have a very strong legal case to challenge mass surveillance conducted domestically or that sweeps in Americans’ communications.  Similarly, the United States Congress is elected by American voters. That means Congressional representatives are beholden to the American people for their jobs, so public pressure from constituents can help influence future laws that might check some of the NSA’s most egregious practices. But what about everyone else? What about the 96% of the world’s population who are citizens of other countries, living outside U.S. borders. They don't get a vote in Congress. And current American legal protections generally only protect citizens, legal residents, or those physically located within the United States. So what can EFF do to protect the billions of people outside the United States who are victims of the NSA’s spying?
  • For years, we’ve been working on a strategy to end mass surveillance of digital communications of innocent people worldwide. Today we’re laying out the plan, so you can understand how all the pieces fit together—that is, how U.S. advocacy and policy efforts connect to the international fight and vice versa. Decide for yourself where you can get involved to make the biggest difference. This plan isn’t for the next two weeks or three months. It’s a multi-year battle that may need to be revised many times as we better understand the tools and authorities of entities engaged in mass surveillance and as more disclosures by whistleblowers help shine light on surveillance abuses.
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    "We have a problem when it comes to stopping mass surveillance. The entity that's conducting the most extreme and far-reaching surveillance against most of the world's communications-the National Security Agency-is bound by United States law. "
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    "We have a problem when it comes to stopping mass surveillance. The entity that's conducting the most extreme and far-reaching surveillance against most of the world's communications-the National Security Agency-is bound by United States law. "
Paul Merrell

European Lawmakers Demand Answers on Phone Key Theft - The Intercept - 0 views

  • European officials are demanding answers and investigations into a joint U.S. and U.K. hack of the world’s largest manufacturer of mobile SIM cards, following a report published by The Intercept Thursday. The report, based on leaked documents provided by NSA whistleblower Edward Snowden, revealed the U.S. spy agency and its British counterpart Government Communications Headquarters, GCHQ, hacked the Franco-Dutch digital security giant Gemalto in a sophisticated heist of encrypted cell-phone keys. The European Parliament’s chief negotiator on the European Union’s data protection law, Jan Philipp Albrecht, said the hack was “obviously based on some illegal activities.” “Member states like the U.K. are frankly not respecting the [law of the] Netherlands and partner states,” Albrecht told the Wall Street Journal. Sophie in ’t Veld, an EU parliamentarian with D66, the Netherlands’ largest opposition party, added, “Year after year we have heard about cowboy practices of secret services, but governments did nothing and kept quiet […] In fact, those very same governments push for ever-more surveillance capabilities, while it remains unclear how effective these practices are.”
  • “If the average IT whizzkid breaks into a company system, he’ll end up behind bars,” In ’t Veld added in a tweet Friday. The EU itself is barred from undertaking such investigations, leaving individual countries responsible for looking into cases that impact their national security matters. “We even get letters from the U.K. government saying we shouldn’t deal with these issues because it’s their own issue of national security,” Albrecht said. Still, lawmakers in the Netherlands are seeking investigations. Gerard Schouw, a Dutch member of parliament, also with the D66 party, has called on Ronald Plasterk, the Dutch minister of the interior, to answer questions before parliament. On Tuesday, the Dutch parliament will debate Schouw’s request. Additionally, European legal experts tell The Intercept, public prosecutors in EU member states that are both party to the Cybercrime Convention, which prohibits computer hacking, and home to Gemalto subsidiaries could pursue investigations into the breach of the company’s systems.
  • According to secret documents from 2010 and 2011, a joint NSA-GCHQ unit penetrated Gemalto’s internal networks and infiltrated the private communications of its employees in order to steal encryption keys, embedded on tiny SIM cards, which are used to protect the privacy of cellphone communications across the world. Gemalto produces some 2 billion SIM cards a year. The company’s clients include AT&T, T-Mobile, Verizon, Sprint and some 450 wireless network providers. “[We] believe we have their entire network,” GCHQ boasted in a leaked slide, referring to the Gemalto heist.
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  • While Gemalto was indeed another casualty in Western governments’ sweeping effort to gather as much global intelligence advantage as possible, the leaked documents make clear that the company was specifically targeted. According to the materials published Thursday, GCHQ used a specific codename — DAPINO GAMMA — to refer to the operations against Gemalto. The spies also actively penetrated the email and social media accounts of Gemalto employees across the world in an effort to steal the company’s encryption keys. Evidence of the Gemalto breach rattled the digital security community. “Almost everyone in the world carries cell phones and this is an unprecedented mass attack on the privacy of citizens worldwide,” said Greg Nojeim, senior counsel at the Center for Democracy & Technology, a non-profit that advocates for digital privacy and free online expression. “While there is certainly value in targeted surveillance of cell phone communications, this coordinated subversion of the trusted technical security infrastructure of cell phones means the US and British governments now have easy access to our mobile communications.”
  • For Gemalto, evidence that their vaunted security systems and the privacy of customers had been compromised by the world’s top spy agencies made an immediate financial impact. The company’s shares took a dive on the Paris bourse Friday, falling $500 million. In the U.S., Gemalto’s shares fell as much 10 percent Friday morning. They had recovered somewhat — down 4 percent — by the close of trading on the Euronext stock exchange. Analysts at Dutch financial services company Rabobank speculated in a research note that Gemalto could be forced to recall “a large number” of SIM cards. The French daily L’Express noted today that Gemalto board member Alex Mandl was a founding trustee of the CIA-funded venture capital firm In-Q-Tel. Mandl resigned from In-Q-Tel’s board in 2002, when he was appointed CEO of Gemplus, which later merged with another company to become Gemalto. But the CIA connection still dogged Mandl, with the French press regularly insinuating that American spies could infiltrate the company. In 2003, a group of French lawmakers tried unsuccessfully to create a commission to investigate Gemplus’s ties to the CIA and its implications for the security of SIM cards. Mandl, an Austrian-American businessman who was once a top executive at AT&T, has denied that he had any relationship with the CIA beyond In-Q-Tel. In 2002, he said he did not even have a security clearance.
  • AT&T, T-Mobile and Verizon could not be reached for comment Friday. Sprint declined to comment. Vodafone, the world’s second largest telecom provider by subscribers and a customer of Gemalto, said in a statement, “[W]e have no further details of these allegations which are industrywide in nature and are not focused on any one mobile operator. We will support industry bodies and Gemalto in their investigations.” Deutsche Telekom AG, a German company, said it has changed encryption algorithms in its Gemalto SIM cards. “We currently have no knowledge that this additional protection mechanism has been compromised,” the company said in a statement. “However, we cannot rule out this completely.”
  • Update: Asked about the SIM card heist, White House press secretary Josh Earnest said he did not expect the news would hurt relations with the tech industry: “It’s hard for me to imagine that there are a lot of technology executives that are out there that are in a position of saying that they hope that people who wish harm to this country will be able to use their technology to do so. So, I do think in fact that there are opportunities for the private sector and the federal government to coordinate and to cooperate on these efforts, both to keep the country safe, but also to protect our civil liberties.”
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    Watch for massive class action product defect litigation to be filed against the phone companies.and mobile device manufacturers.  In most U.S. jurisdictions, proof that the vendors/manufacturers  knew of the product defect is not required, only proof of the defect. Also, this is a golden opportunity for anyone who wants to get out of a pricey cellphone contract, since providing a compromised cellphone is a material breach of warranty, whether explicit or implied..   
Paul Merrell

FBI Now Holding Up Michael Horowitz' Investigation into the DEA | emptywheel - 0 views

  • Man, at some point Congress is going to have to declare the FBI legally contemptuous and throw them in jail. They continue to refuse to cooperate with DOJ’s Inspector General, as they have been for basically 5 years. But in Michael Horowitz’ latest complaint to Congress, he adds a new spin: FBI is not only obstructing his investigation of the FBI’s management impaired surveillance, now FBI is obstructing his investigation of DEA’s management impaired surveillance. I first reported on DOJ IG’s investigation into DEA’s dragnet databases last April. At that point, the only dragnet we knew about was Hemisphere, which DEA uses to obtain years of phone records as well as location data and other details, before it them parallel constructs that data out of a defendant’s reach.
  • But since then, we’ve learned of what the government claims to be another database — that used to identify Shantia Hassanshahi in an Iranian sanctions case. After some delay, the government revealed that this was another dragnet, including just international calls. It claims that this database was suspended in September 2013 (around the time Hemisphere became public) and that it is no longer obtaining bulk records for it. According to the latest installment of Michael Horowitz’ complaints about FBI obstruction, he tried to obtain records on the DEA databases on November 20, 2014 (of note, during the period when the government was still refusing to tell even Judge Rudolph Contreras what the database implicating Hassanshahi was). FBI slow-walked production, but promised to provide everything to Horowitz by February 13, 2015. FBI has decided it has to keep reviewing the emails in question to see if there is grand jury, Title III electronic surveillance, and Fair Credit Reporting Act materials, which are the same categories of stuff FBI has refused in the past. So Horowitz is pointing to the language tied to DOJ’s appropriations for FY 2015 which (basically) defunded FBI obstruction. Only FBI continues to obstruct.
  • There’s one more question about this. As noted, this investigation is supposed to be about DEA’s databases. We’ve already seen that FBI uses Hemisphere (when I asked FBI for comment in advance of this February 4, 2014 article on FBI obstinance, Hemisphere was the one thing they refused all comment on). And obviously, FBI access another DEA database to go after Hassanshahi. So that may be the only reason why Horowitz needs the FBI’s cooperation to investigate the DEA’s dragnets. Plus, assuming FBI is parallel constructing these dragnets just like DEA is, I can understand why they’d want to withhold grand jury information, which would make that clear. Still, I can’t help but wonder — as I have in the past — whether these dragnets are all connected, a constantly moving shell game. That might explain why FBI is so intent on obstructing Horowitz again.
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    Marcy Wheeler's specuiulation that various government databases simply move to another agency when they're brought to light is not without precedent. When Congress shut down DARPA's Total Information Awareness program, most of its software programs and databases were just moved to NSA. 
Paul Merrell

Did NSA, GCHQ steal the secret key in YOUR phone SIM? It's LIKELY * The Register - 0 views

  • The NSA and Britain's GCHQ hacked the world's biggest SIM card maker to harvest the encryption keys needed to silently and effortlessly eavesdrop on potentially millions of people. That's according to documents obtained by surveillance whistleblower Edward Snowden and leaked to the web on Thursday. "Wow. This is huge – it's one of the most significant findings of the Snowden files so far," computer security guru Bruce Schneier told The Register this afternoon. "We always knew that they would occasionally steal SIM keys. But all of them? The odds that they just attacked this one firm are extraordinarily low and we know the NSA does like to steal keys where it can." The damning slides, published by Snowden's chums at The Intercept, detail the activities of the as-yet unheard-of Mobile Handset Exploitation Team (MHET), run by the US and UK. The group targeted Gemalto, which churns out about two billion SIM cards each year for use around the world, and targeted it in an operation dubbed DAPINO GAMMA.
  • Gemalto's hacking may also bring into question some of its other security products as well. The company supplies chips for electronic passports issued by the US, Singapore, India, and many European states, and is also involved in the NFC and mobile banking sector. It's important to note that this is useful for tracking the phone activity of a target, but the mobile user can still use encryption on the handset itself to ensure that some communications remain private. "Ironically one of your best defenses against a hijacked SIM is to use software encryption," Jon Callas, CTO of encrypted chat biz Silent Circle told The Register. "In our case there's a TCP/IP cloud between Alice and Bob and that can deal with compromised routers along the path as well as SIM issues, and the same applies to similar mobile software."
  • On Wednesday the UK government admitted that its intelligence agencies had in fact broken the ECHR when spying on communications between lawyers and those suing the British state, so GCHQ might want to reconsider that statement.
Paul Merrell

Lawmakers Say TPP Meetings Classified To Keep Americans in the Dark | Global Research - 0 views

  • US Trade Representative Michael Froman is drawing fire from Congressional Democrats for the Obama adminstration’s continued imposition of secrecy surrounding the Trans-Pacific Parternship. (Photo: AP file) Democratic lawmaker says tightly-controlled briefings on Trans-Pacific Partnership deal are aimed at keeping US constituents ignorant about what’s at stake Lawmakers in Congress who remain wary of the Trans-Pacific Partnership (TPP) trade agreement are raising further objections this week to the degree of secrecy surrounding briefings on the deal, with some arguing that the main reason at least one meeting has been registered “classified” is to help keep the American public ignorant about giveaways to corporate interests and its long-term implications.
  • Among its other critics, Sen. Elizabeth Warren has slammed the idea of ISDS provisions as a surrender of democratic ideals to corporate interests. According to Warren, ISDS would simply “tilt the playing field in the United States further in favor of big multinational corporations.” By having unchallenged input on secretive TPP talks, Warren argued last month, these large companies and financial interests “are increasingly realizing this is an opportunity to gut U.S. regulations they don’t like.” According to Grayson, putting Wednesday’s ISDS briefing in a classified setting “is part of a multi-year campaign of deception and destruction. Why do we classify information? It’s to keep sensitive information out of the hands of foreign governments. In this case, foreign governments already have this information. They’re the people the administration is negotiating with. The only purpose of classifying this information is to keep it from the American people.”
  • “I’m not happy about it,” Rep. Alan Grayson (D-Fla.) told the Huffington Post, referring to the briefing with Froman and Labor Secretary Thomas Perez on Wednesday. The meeting—focused on the section of the TPP that deals with the controversial ‘Investor-State Dispute Settlement’ (ISDS) mechanism—has been labeled “classified,” so that lawmakers and any of their staff who attend will be barred, under threat of punishment, of revealing what they learn with constituents or outside experts. According to the Huffington Post: ISDS has been part of U.S. free trade agreements since NAFTA was signed into law in 1993, and has become a particularly popular tool for multinational firms over the past few years. But while the topic remains controversial, particularly with Democrats, many critics of the administration emphasize that applying national security-style restrictions on such information is an abuse of the classified information system. An additional meeting earlier on Wednesday on currency manipulation with Froman and Treasury Secretary Jack Lew is not classified.
  • ...1 more annotation...
  • As The Hill reports: Members will be allowed to attend the briefing on the proposed trade pact with 12 Latin American and Asian countries with one staff member who possesses an “active Secret-level or high clearance” compliant with House security rules. Rep. Rosa DeLauro (D-Conn.) told The Hill that the administration is being “needlessly secretive.” “Even now, when they are finally beginning to share details of the proposed deal with members of Congress, they are denying us the ability to consult with our staff or discuss details of the agreement with experts,” DeLauro told The Hill. Rep. Lloyd Doggett (D-Texas) condemned the classified briefing. “Making it classified further ensures that, even if we accidentally learn something, we cannot share it. What is [Froman]working so hard to hide? What is the specific legal basis for all this senseless secrecy?” Doggett said to The Hill. “Open trade should begin with open access,” Doggett said. “Members expected to vote on trade deals should be able to read the unredacted negotiating text.”
Paul Merrell

New Security Bill will force online service providers to keep log of users' activity - ... - 0 views

  • Terrorists and child sex rings could be uncovered through their internet discussions as part of a tough set of security measures to be unveiled by Home Secretary Theresa May this week. Major online service providers, such as Google, will be legally obliged to retain a log of users and the mobile phones or computers they have accessed in case police and security agencies later need the information to help them locate criminals. This measure will be included in the Counter-terrorism and Security Bill that is being introduced in the wake of Isis’s beheadings of prisoners, including British aid workers David Haines and Alan Henning, this year
Paul Merrell

Thousands Join Legal Fight Against UK Surveillance - And You Can, Too - The Intercept - 1 views

  • Thousands of people are signing up to join an unprecedented legal campaign against the United Kingdom’s leading electronic surveillance agency. On Monday, London-based human rights group Privacy International launched an initiative enabling anyone across the world to challenge covert spying operations involving Government Communications Headquarters, or GCHQ, the National Security Agency’s British counterpart. The campaign was made possible following a historic court ruling earlier this month that deemed intelligence sharing between GCHQ and the NSA to have been unlawful because of the extreme secrecy shrouding it.
  • Consequently, members of the public now have a rare opportunity to take part in a lawsuit against the spying in the Investigatory Powers Tribunal, a special British court that handles complaints about surveillance operations conducted by law enforcement and intelligence agencies. Privacy International is allowing anyone who wants to participate to submit their name, email address and phone number through a page on its website. The group plans to use the details to lodge a case with GCHQ and the court that will seek to discover whether each participant’s emails or phone calls have been covertly obtained by the agency in violation of the privacy and freedom of expression provisions of the European Convention on Human Rights. If it is established that any of the communications have been unlawfully collected, the court could force GCHQ to delete them from its vast repositories of intercepted data.
  • By Tuesday evening, more than 10,000 people had already signed up to the campaign, a spokesman for Privacy International told The Intercept. In a statement announcing the campaign on Monday, Eric King, deputy director of Privacy International, said: “The public have a right to know if they were illegally spied on, and GCHQ must come clean on whose records they hold that they should never have had in the first place. “We have known for some time that the NSA and GCHQ have been engaged in mass surveillance, but never before could anyone explicitly find out if their phone calls, emails, or location histories were unlawfully shared between the U.S. and U.K. “There are few chances that people have to directly challenge the seemingly unrestrained surveillance state, but individuals now have a historic opportunity finally hold GCHQ accountable for their unlawful actions.”
Paul Merrell

Here's How You Can Find Out If The NSA Shared Your Data With British Spies - Forbes - 0 views

  • In the UK earlier this month, human rights groups Liberty and Privacy International were cheered by a tribunal decision that declared GCHQ’s access to NSA spies’ data illegal. Though it was a hollow victory, as the tribunal also declared all current activities, including all those blanket surveillance projects much derided by free speech activists, entirely legal. The practices previously broke the law because the public was unaware of what safeguards were in place for the UK’s access to data from NSA programs like Prism; as soon as Snowden blew everything wide open the snoops had to explain themselves, and that was enough for the tribunal to confirm the legality of GCHQ’s operations. But the case has had one significant effect: anyone can now figure out if their data was illegally shared by the agencies. Privacy International has set up a simple webpage that anyone in the world can sign up to. You can visit the page here.
  • Once the UK Investigatory Powers Tribunal has determined whom was affected, it has to inform them. Though participants should find out whether their data were unlawfully obtained by GCHQ from the millions of private communications hoovered up by the NSA up until December 2014, it won’t be anytime soon. Privacy International warned in its FAQs: “Count on it being many months, and likely years before this action is completed.” And somewhat ironically Privacy International has to collect participant’s information, including their name and email address, to supply the service. They may ask for more information from willing participants once the group has determined if more is required from the IPT. Anyone who wants to submit directly to the tribunal can do so here.
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