CIA and BND Espionage Scandal with Switzerland's Illusory Neutrality
It is difficult to explain all the ramifications of this Crypto AG scandal and how it has shaken Switzerland and the entire world.
For decades, U.S. and German intelligence used encryption devices from the Swiss company, Crypto AG, to spy on other countries. From the Cold War until the 2000s, Crypto AG sold these devices to more than 120 governments around the world. The machines were encrypted, but this week it emerged that the CIA and the German Federal Intelligence Service (BND) had manipulated the devices so that they could crack the codes and intercept thousands of messages from customer governments. Rumors had circulated in the past but now everyone knows.
Precursor in the Post-World War II Era
So Crypto AG had these devices and it seems that the spy agencies had a back door and were spying on the 120 or so countries that were using Crypto AG's encryption devices. A fascinating story that of course opens the lid on Cold War and Post Cold War espionage, let's remember a little bit what happened in the 1930s and 1940s when the most widely used encryption device by governments and armed forces around the world was the German Enigma machine and the British managed to break the code for that but kept it secret even though they shared the information with the US.In fact, what happened was that all kinds of governments throughout the world continued to use the Enigma machines a decade or even two decades after World War II without knowing that the US and the British could read their messages until governments eventually moved to other technologies besides the Enigma machine.
Espionage 2.0
Now it is coming to focus on the program currently being discussed all over the news, it seems that the past spying program put the idea in the heads of some people in the CIA about trying to continue this successful penetration of other countries' logistics. But this time they would use the apparent neutrality of Switzerland to sell cryptographic devices by attracting naïve governments, as often many countries would go to Switzerland which by then was thought of as a neutral country and normatively stayed away from alliances between countries. So, there went a large number of countries to buy their encryption devices under the assumption that because Switzerland was neutral, and that their encryption devices would be safe from the CIA and the BND, but in fact both intelligence agencies owned this company and had basically manipulated these machines, being able to continue listening and reading for years what the governments were saying.
"It was the intelligence coup of the century," a classified CIA report on the decades-long operation concluded. "Foreign governments were paying good money to the United States and West Germany for the privilege of having their most secret communications read by at least two (and possibly as many as five or six) foreign countries."
Beginning in 1970, the CIA and its code-breaking sister, the NSA (National Security Agency), controlled all aspects of Crypto AG's operations, presiding with its German partners over hiring decisions, designing its technology, manipulating its algorithms and directing its sales targets.
One government that was hit with all of this was the Iranian government, which apparently has used these machines, so here we have a country that has been an opponent of the United States and has had its intelligence and its activities compromised in a disastrous way potentially. Now that we know that this has been going on the CIA, probably, has already opted for other means of trying to crack the new codes and things of that sort but, of course, Switzerland is left in a major political crisis. You have to realize that China and Russia, the two countries that are the most serious adversaries of the U.S. were not affected, because they never bought or trusted these machines and used their own encryption devices, which the U.S. is said to have never cracked properly.
Illusory Neutrality
One of the most important aspects in Switzerland, (in society as such and political culture) is its apparent neutrality, according to a BBC article now that the Crypto AG scandal has emerged in all its tawdry details. there is not a newspaper or broadcaster in the country that does not question Switzerland's neutrality. "It's broken," is a commonly used phrase.
The illusion of neutrality is definitely shattered because the reality is that Switzerland has always managed to stay out of the various alliances that have shaped the post-Cold War era. Anyone who knows Switzerland well knows that it is irreparably integrated with the West, its banking system is an absolute manifestation of the parameters of the Western financial system and Switzerland's political system is extremely similar to that of other Western countries. Of course, Switzerland also has very close and deep relations with the EU, so it has never really been a neutral country.
So this has been one as an illusion, but it is one that the Swiss people were very attached to, so by having this illusion laid bare in this way, it is not surprising that it creates an uproar and a big political storm.
Another BBC article mentions a Kaspar Villiger who, while serving as defense minister in the 1990s, knew that the CIA controlled Crypto AG and sold faulty encryption machines around the world to spy on foreign governments.
Kaspar Villiger, as Sweden's defense minister for the 1990s conspired and sponsored selling these faulty encryption machines that were essentially espionage vehicles for use by the U.S. and Germany, so once again we're seeing the NATO international military industrial complex conspiring with the government. We see these revolving doors between the defense ministers of various countries and the CEOs of these technology companies, communications companies working hand in hand with the spy agencies, the Intel agencies and the weapons manufacturers. While people may think of Switzerland as a country where corruption has not totally seeped into the system, but then reading in the press about this scandal, one would think they are no different than the United States.
Swiss NATO partners
But he was the defense minister in the 1990s, one of those who helped sell the machines while he knew that the CIA controlled Crypto AG and was selling defective devices to 120 governments and when the president of the Swiss Confederation, Simonetta Sommaruga was asked about Villiger on Swiss TV, she said that speculation was nonsense and that "we will discuss it when we have the facts." But we already have the facts, we know exactly what he was doing, he was the defense minister and he was actively promoting the sale of these devices knowing what they were.
It is worth noting that Switzerland is of course very close politically and economically to Germany and certainly also was so during World War II. Not to minimize Swiss neutrality during WWII, as the Swiss actually kept a considerable distance from the Germans during WWII, but they always had to be extremely careful because ultimately Swiss society in Germany are very interconnected with each other. So it should come as no surprise that the BND, the German intelligence agency, was involved in all this activity. I suspect that it was through them that the United States entered Switzerland and was able to establish this connection with this Swiss company Crypto AG and also with the political class in Switzerland because the Germans have always had very strong connections both with Swiss industry and with the Swiss financial class and also with the political class in Switzerland. Although I must admit that I was not surprised when I heard about all this because the Swiss are involved in everything, their banks have played a very important role all over the world in supporting people who are friends of the United States.
It is known that many dictators and criminals throughout the world have Swiss bank accounts. The United States has always known all about it and has always approved it with a green light, so Switzerland has played a role like this on multiple levels, it has been a convenience for the United States to make Switzerland look neutral when in fact it was not.
But at least one good thing that came out of this is that, of course, countries around the world will no longer trust the Swiss with their encryption devices in the future or take Swiss neutrality seriously and the Swiss themselves will know a little better the realities about what their country is doing.