Does CSE do economic intelligence?

Some of the recent coverage of CSE has expressed a certain amount of skepticism about the idea that CSE might do economic intelligence-gathering.

For example, Wesley Wark, one of the leading experts on intelligence issues in Canada, expressed considerable doubt about the possibility in this article (Mark Gollom, "Brazil-Canada espionage: Which countries are we spying on?" CBC News, 8 October 2013), suggesting instead that Canada may have pursued its Brazilian targets at the behest of one of its UKUSA partners:

Security and intelligence expert Wesley Wark expressed doubts that any effort to collect information on Brazil was purely a Canadian intelligence operation with Canadian objectives.

Wark also questioned how Canada would be able to get access to those kinds of communications and why CSEC would devote its limited resources against a target not considered a top-tier threat.

"If this was a made in Canada intelligence operation, It doesn’t make a lot of sense to me," said Wark, who is also a professor at the graduate school of public and international affairs at the University of Ottawa.

Instead, Wark said he believed this task was handed down to Canada by one of its so-called "Five Eyes" partners — the U.S., U.K., Australia and New Zealand — who all share intelligence. Most likely, Wark said, it came from America's National Security Agency, which, according to previous revelations by former U.S. National Security Agency contractor Edward Snowden, had been targeting Brazil in the past.

"It would fit in with the modus operandi of the Five Eyes partnership that an intelligence task like this, which would include intelligence collected by one partner, might actually be handed over to another partner for processing and work," he said.

"Very often the intelligence that's gathered is distributed among partners to be worked up and I suspect that's what's happening in this case."

CSEC's legislative mandate when it comes to collecting foreign intelligence is very broadly defined in the National Defence Act, he said.

The secretive organization has played roles in Afghanistan, he said, by supporting military operations there, and also assisted in the hunt for the kidnappers of Canadians Robert Fowler and Louis Guay in Niger.

"We don’t really have any general sense of its strategic effort to collect intelligence," said Wark.

And there's nothing in the act that prevents it from gathering economic intelligence or explicitly states that it would be a natural part of what CSEC does, Wark said.

But he was skeptical about the amount of economic espionage CSEC has conducted in the past.

The agency's primary targets include global terrorist organizations, conflict zones where Canadian interests or Canadian troops are involved and weapons of mass destruction. Economic intelligence has not been a priority, he said.

"I don’t think it does much of it, if any at all."

And if economic intelligence has become a new priority, he said, then the public needs to be aware of it.

While it's indisputable that Counter-Terrorism and Support to Military Operations have been at the top of CSE's priorities list in recent years, I'm not so sure that Economic Intelligence is that low on the list.

Part of the problem here may lie in varying definitions of economic intelligence, which can range from data on future global energy supplies and the functioning of the global economic system to the inside scoop on the negotiating positions of other countries participating in trade negotiations to detection of bribery and bid-rigging in international competitions for multi-billion-dollar contracts to the theft of competitors' trade secrets and provision of that information to companies in one's own country.

There is absolutely no doubt that CSE, working alone and through its allies, collects some of these types of information. The contentious question, to which the public has no solid answer, is how far it goes toward the right-hand end of this spectrum.

But there have certainly been suggestions from time to time that Canadian activities have extended pretty far towards the right-hand side.

In the early 1980s, the use of Canadian SIGINT on global wheat production and pricing to maximize the price at which Canadian wheat could be sold was widely cited in news reporting about CSE (Neil Macdonald, "Security bill: `It leaves few places to hide'," Ottawa Citizen, 10 September 1983):

Of far more importance and value [than security related traffic]... is the commercial and diplomatic traffic intercepted by the CSE. Other government departments, notably External Affairs, "just hunger for it," said one source. The classic example given by security experts is information on the wheat market, Canada's most important area of trade with the Soviet Union. "A Soviet delegation might be over here pretending they don't really need all that much this year, and that they aren't willing to pay as much for it," said one government expert. "In the meantime, CSE has Sigint ...indicating there's been a crop failure in the Ukraine and they're desperate for our wheat. We can save Canadian farmers and grain dealers a fortune, so why not? Everybody does it."

Allies were also reportedly the target of such collection:

[Former Solicitor General Allan] Lawrence noted that the U.S. is one of Canada's major trading rivals: "They (the CSE) gave me the wheat scenario, too. Sure, we should know what effects the crop failure in Russia will have. But we should also know what the Argentines or what the U.S. are going to do about it."

Mike Frost's book Spyworld describes a specific instance of CSE collecting intelligence on U.S. plans for wheat sales to China, although the intercept in that case was said to have been inadvertent (pp. 224-7).

Spyworld also reported that CSE was directed to collect intelligence on an upcoming pipeline contract in India:

In 1985, the "Pilgrim" team got another "special" request from External Affairs for the New Delhi team. At one of their meetings an External representative told Frost: "The Minister would like you to look into some economic intelligence.... We have a Canadian company bidding on a pipeline to be built in India for $2.5 billion, and we'd like to get as much information on what's going on as possible." (p. 193)

Around the same time, in 1984, CSE began embedding Client Relations Officers in customer departments. The first four departments to host CROs were the Privy Council Office, External Affairs, Finance, and Industry, Trade and Commerce. (See more here.) This development was probably related to CSE's decision to begin operating embassy intercept sites and satellite monitoring facilities a few years earlier.

The 1990s brought a much increased emphasis on economic intelligence, if the whistleblowers of the period -- Mike Frost, Jane Shorten, and Fred Stock -- can be believed. All claimed that economic spying was stepped up significantly following the end of the Cold War, as CSE sought to justify its existence in an "end of history" world that was supposed to be characterized from then on by peaceful economic competition.

Wark himself had some interesting comments on the Shorten allegations at the time ("Canada to review agency accused of spying on allies," Associated Press, 14 November 1995):

Wesley Wark, a University of Toronto history professor, said spy agencies around the world, including those of the United States, France and Japan, increasingly gather economic information.

Wark said Canada would be foolish not to join in.

"I don't know what a friendly power in the economic sphere is, exactly, these days," he said. "That seems to be a very ambiguous term."

The government seemed to agree.

How far to the right of the spectrum economic intelligence-gathering routinely went we do not know, but by the 1990s its place in the pantheon of CSE priorities was freely acknowledged by the Canadian government.

Consider this April 1990 statement by Ward Elcock, then Deputy Clerk (Security and Intelligence, and Counsel) in the Privy Council Office, to the Special Committee on the Review of the Canadian Security Intelligence Service Act and the Security Offences Act:

The Communications Security Establishment... has in essence two roles. One of those is sometimes known as the ComSec role, which deals with the security of the communications of the Government of Canada. The second responsibility is the collection of signals intelligence, which is intended to provide the government with foreign intelligence on the diplomatic, military, economic, security and commercial activities, intentions, and capabilities of foreign governments, individuals, and corporations. [Emphasis added]

And the organization of the agency reflected those priorities: the largest of the two analysis groups within CSE's SIGINT Production Directorate was the International Political and Economic Production Group. The Soviet Production Group, previously the largest, had shrunk dramatically with the end of the Cold War, re-emerging as the combined, but still smaller, Military Production and Transcription Group.

Job ads in the late 1990s sought candidates with "a keen interest in global economic and political affairs" and "either a) proficiency in at least one Asian, Middle-Eastern or European language, or b) an academic background or experience in international economics, international business or international finance."

There is no doubt that CSE's intelligence priorities changed once again following 9/11. But the current CSE is more than twice as large as the CSE of the 1990s, and there is no reason to believe that economic intelligence ever disappeared entirely from the organization's remit.

So...

Does CSE collect economic intelligence?

Yes.

Is it stealing trade secrets or subverting bidding processes for the benefit of Canadian companies or industries?

There is some reason to believe such activities have been conducted at least occasionally in the past, but how often they are currently conducted, if at all, remains to be seen.

Let us now all turn, expectantly, in the direction of Glenn Greenwald.

[Update 11 October 2013: Journalist Andrew Mitrovica comments on Jane Shorten:

I have to take issue... with your reference to Jane Shorten. As you may know, I have written about my 1995 reporting about Shorten while I was at CTV earlier this week for the Star and in today's Citizen.

You write that "if the whistleblowers of the period like Mike Frost, Jane Shorten and Fred Stock -- can be believed."

I can't speak for Frost or Stock because I haven't tested the veracity of their statements to other journalists. I did, however, spend some considerable time with Shorten before, during, and after her extensive interviews with me and a former CTV colleague.

Shorten told the truth, no if, cans or buts. You do her a disservice by implying that there remains doubt about what she so courageously shared with Canadians about what she was no longer prepared to tolerate doing on CSEC's behalf in the name of "national security."

She went public with her grave concerns at great personal risk. She did not make a cent or profit in any other way by stepping forward to tell Canadians the truth. All she wanted was a mechanism to be established to rein in what she believed to be CSEC's unchecked powers.

And to her credit, that is precisely what happened. The Liberal government of the day created the office of the CSEC commissioner - limp as it is - in direct response to Shorten's iron-clad revelations. She did it. Not journalists, academics or bloggers.

So I think you need to correct the record and recognize the invaluable and indisputable role Shorten played in raising the alarm and forcing the government's historically reluctant hand in creating the one and only oversight body over CSEC.

(Reproduced with permission. Thanks, Andrew!)]

[Update 13 October 2013: I personally have no doubt that Jane Shorten was telling the truth. And I would agree that her revelations probably did a lot to ensure the creation of the Office of the CSE Commissioner.

But the Chretien government had already agreed in principle to establish such a mechanism by the time Shorten spoke up. On March 21st, 1995, the House of Commons passed a motion introduced by Liberal MP Derek Lee calling on the government to "establish an independent external mechanism to review the operations of the Communications Security Establishment, CSE, similar to the role played by the Security Intelligence Review Committee for the Canadian Security Intelligence Service, and table a report annually in the House." The Liberals had a comfortable majority in the Commons at the time, and this motion could only have passed with the de facto support of the Chretien government. The day after the motion, Defence Minister David Collenette announced that "in principle, the government supports an oversight mechanism for the CSE".

Derek Lee's motion was the result of a lot of prior work of many MPs, academics, and others, and it was passed in the context of extensive recent CSE-related reporting, most notably of Mike Frost's revelations in Spyworld, which was published in October 1994.

Did Shorten's revelations in November 1995 help ensure that the government's stated support for an oversight mechanism was followed up by the actual creation of the Office of the CSE Commissioner in June 1996?

I think that's quite likely.

We can certainly dismiss any role of bloggers in the events of 1995 and 1996.

But let's not ignore the contributions of the many other concerned Canadians whose efforts helped create the CSE oversight office.]