Companies & Industries

Was CSEC really conducting industrial espionage for Canadian corporations?

Operation: Brazil Nuts

Dilma Rouseff, Brazil's president-elect. (Photo: Song Weiwei/Xinhua Press/Corbis)

Dilma Rouseff, Brazil’s president (Photo: Song Weiwei/Xinhua Press/Corbis)

Brazil’s premier television news show is called Fantástico, an apt description of the allegations it aired on Oct. 6 of alleged Canadian spying activity.

Using documents leaked by former CIA contractor Edward Snowden as its source, Fantástico outlined an apparent plan by Communications Security Establishment Canada, to hack into the computers of Brazil’s Ministry of Mines and Energy. The operation, code-named Olympia, was detailed in a presentation to Canada’s intelligence allies in the U.K., U.S., New Zealand and Australia (together known as the Five Eyes.)

It appeared to be a glimpse into the murky world of Canadian intelligence, specifically that of CSEC. The agency is identified by the government as a monitor of global communication systems, with a $350-million budget. As Brazilian President Dilma Roussef publicly condemned the Fantástico report’s revelations, it appeared Canada had sparked a major international incident by spying on a friendly nation— one in which it invested $9.8 billion last year. But two weeks later any controversy over the Fantástico report has simply evaporated. Perhaps Brazil’s shock at being spied upon was overstated. Those familiar with global intelligence say such practices aren’t really scandalous, but commonplace. “It’s assumed that this type of activity is ongoing between most major players on the world stage,” says Keith Murphy, CEO of information security firm Defence Intelligence.

And while Canada has been cast as the aggressor in this story, it is equally possible that any spying was defensive in nature. Christian Leuprecht, a political science professor at RMC and Queen’s University, says that unlike other nations’ security agencies, which might actively seek to extract information from other states, Canada’s intelligence operations focus more often on protecting intellectual property and trade secrets. In an apparent bid to protect such assets, CSIS last year made public its discomfort regarding the takeover of Canadian company Nexen by China’s CNOOC.

“It makes you wonder, what might the Brazilians have done to Canadian companies for Canada to become engaged in Brazil?” Leuprecht asks. “Would you sit idly by as people try to come and attack your house and try to steal your car? You’d probably try to protect your place. And one way to protect your place is, you need to gather intelligence.”

Of course, there is no concrete evidence of Brazilian espionage in Canada, while suspicions about collusion between Canadian industry and its spy agencies continue. Days after the Fantástico program aired, the Guardian reported that CSEC has held biannual “off the record” national security meetings with Canadian energy companies since at least 2005.

The heavily redacted agendas obtained by the Guardian, however, revealed the name of only one company involved in the briefings, and for a rather trivial reason. Enbridge supplied the coffee and refreshments at the most recent gathering in May 2013.

Enbridge spokesperson Graham White wrote in an e-mail that while the company did provide refreshments, it has “no further comment,” as “Enbridge representatives were unable to attend that May 2013 meeting.”

While it may appear Canadian intelligence officials met with executives to share the spoils of their snooping, John Adams, who was head of CSEC until early 2012, says that wouldn’t be allowed.

Intelligence agencies are “forbidden from sharing anything with the private sectors,” he says. “It’s true they meet on a regular basis, but it’s to help them defend the critical infrastructure. Not to exchange intelligence.” Furthermore, anyone who alleges CSEC engages in economic espionage at all is “guessing.”

“There’s no way that you’re going to find out, unless the government’s prepared to tell you,” says Adams.

Michel Juneau-Katsuya, CEO of security firm the Northgate Group and former head of Asia-Pacific operations for CSIS, agrees. “In the 35 years that I’ve been in the game now, I’ve never seen the government passing [intelligence] information to the private sector,” he says.