19 January 1999. Thanks to Anon.

    http://cnn.com/SPECIALS/cold.war/experience/spies/melton.essay/

    Spies in the Digital Age
    By H. Keith Melton

    The end of the Cold War has not brought about world peace; we have seen only
    the end of one conflict and the beginning of a new one. This new conflict is
    a global economic war in which spies and new technologies will again play an
    important role in determining the final victors.

    Beginning in World War II and continuing throughout the Cold War, the
    world's major intelligence agencies (the CIA, KGB's First Chief Directorate,
    MI6, etc.) employed the latest technologies available in "collection,"
    communication and analysis of information from abroad.

    At the same time, counterintelligence agencies (the FBI, KGB's Second Chief
    Directorate, MI5, etc.) employed other technologies in efforts to identify
    and eliminate foreign spies at home. The new global economic warfare will
    see these basic roles continue, but with important changes in four major
    areas:

    ++ The primary targets of spies for all intelligence services have shifted.

    ++ The traditional roles of "friends and foes" continue to blur.

    ++ New technologies are changing the traditional methods and techniques
    (called "tradecraft") by which spies operate.

    ++ And the traditional tradecraft of spies are applied in new ways.

    New targets for old spies

    In the final days of the Cold War, the crumbling Soviet Union possessed the
    nuclear weapons to destroy the world but lacked the economic and
    informational infrastructure to compete as a world power. While the
    preeminent weapon for most of this century was the hydrogen bomb, it has
    been replaced by the awesome capability of a single electron! Future
    superpowers will be those nations with the greatest capability to harness
    the power of the electron for both economic and "digital" warfare.

    The desire of foreign spies to uncover and obtain "military secrets" will
    continue, but with interesting variations. We are witnessing the migration
    of a national defensive infrastructure that has historically been based on
    "bullets" into one based upon "information." Success by spies targeting an
    opponent's "information" will ultimately prove more valuable.

    Friend or foe?

    The traditional Cold War alignment of the East vs. West is gone forever.
    Gen. Yuri Kobaladze of the SVR -- the Russian Foreign Intelligence Service,
    successor to the First Chief Directorate of the KGB -- recently stated
    "there are friendly nations, but there are no friendly intelligence
    services".

    Even at the height of Cold War solidarity (the enemy of my enemy is my
    friend), the major superpowers collected intelligence and attacked the
    ciphers, or codes, of our friends as well as our enemies. The national
    interests of former friends and foes are now being redefined in terms of
    competing economic interests.

    Cultural and historic friendships between nations will continue to fade as
    they are replaced by trading partnerships and other interdependent economic
    relationships. The friend of my enemy may also be my friend -- if the price
    is right. Military alliances will be designed to protect, perpetuate and
    enhance underlying economic partnerships. The victors in global economic
    warfare will form regional economic alliances that will share information
    and together strengthen their collective -- and individual -- economic
    power.

    New technologies for the digital spy

    The tradition roles of spies in gathering, communicating and analyzing
    information (secrets), as well as counterintelligence, have been altered in
    ways never before imagined.

    Gathering information

    The advent of the "Keyhole" satellite program nearly 30 years ago provided
    the United States with the capability to digitally observe events on Earth
    in near "real time." Exponential advances in computer processing power have
    subsequently provided refinements that allow these "spies in the sky" to
    observe the Earth regardless of cloud cover, inclement weather and darkness.
    Using infrared cameras, radar and advanced sensing lenses, they can resolve
    images approaching a single inch in diameter. The strategic role of
    satellites will be tactically supplemented by small pilotless drone
    aircraft, with stealth masking, capable of remaining aloft for days at a
    time over hostile territory.

    New "ears in space," sometimes officially designated as "weather or mapping"
    satellites, will continue to eavesdrop on all forms of communication signals
    transmitted into the ether. The increasing utilization of wireless
    frequencies for the transmission of telephone and computer data is absorbed
    into the antenna of these satellites and relayed to ground stations on Earth
    for analysis. Speech recognition software, new to the consumer market but
    utilized by intelligence agencies for more than 25 years, will employ
    artificial intelligence to "filter the unnecessary" and recover secrets
    being communicated by both friends and foes.

    The transformation of the Internet into the "information highway" has
    forever changed the way in which information is gathered. CIA veteran
    Sherman Kent, author of "Strategic Intelligence for American World Policy,"
    once observed 50 years ago that 90 percent of everything spies need to know
    is available openly. The Internet, as the library of world knowledge, has
    become the repository of information needed to fuel economies of the world's
    superpowers. The keys to this "fountain of knowledge" are high-speed
    Internet access, advanced networking to share information quickly, and
    massive computer power to analyze billions of bits of data to discover the
    secrets hidden inside.

    Powerful Internet browsers and "agents" are even now traveling through
    cyberspace into the computers and networks of both the suspecting and
    unsuspecting to record their secrets. A clever computer programmer in the
    immediate future will unleash electron based "cyber-agents" to recover more
    vital information in a day than a thousand fictional James Bonds could
    recover in a lifetime.

    Convicted KGB spy John Walker noted after his arrest that the defenses of
    the United States were constructed to protect against enemies from outside,
    not from the treachery of loyal Americans within. Purchasing secrets from
    traitors remains an effective and profitable mainstay of intelligence
    collection. A few million dollars invested in an intelligence program to
    recruit spies with access to important secrets may result in economic
    payoffs worth billions of dollars.

    Hostile intelligence services traditionally relied on intuition and
    informants to identify persons for recruitment as spies. Excessive personal
    debt, substance abuse and failed careers were often the first indicators of
    weaknesses that could be used to leverage recruitments. Digital spies now
    have the advantage of processing computerized credit checks on the Internet
    to recover spending habits, debt loads, medical records, and job-change
    patterns to identify potential recruits. By using the Internet as a
    "spotting" tool, the efforts of intelligence services are focused on a small
    pool of potential recruits that have existing weaknesses waiting to be
    exploited.

    Future intelligence services will venture further into international banking
    in a global world of commerce and interlocking financial relationships.

    Communicating

    The most dangerous point of vulnerability for a spy operating in hostile
    territory was not when he was stealing secrets, but rather when he attempted
    to communicate them to his "handler." Public awareness of the "tradecraft"
    of the Cold War was often focused around the communication techniques of
    "brush passes," "car tosses" and "dead drops." Despite their sophistication
    and usefulness, they were vulnerable to an alert counterintelligence service
    and often confirmed the actions of the suspect being observed. In the United
    States, the arrests of naval spy John Walker in 1985 and Aldrich "Rick"
    Ames, a KGB "mole" inside the CIA, in 1994 were precipitated by their
    actions to communicate with their Soviet or Russian handlers.

    The Internet has changed this vulnerability into an advantage for the spy.
    Spies now utilize the Internet to communicate with near impunity. Messages,
    information and signals are now transmitted in ways that appear innocuous
    but almost defy detection because they are interlaced into the normal and
    growing usage of the Internet. As information is transmitted or received
    into the Internet, its true recipient or sender may be masked in a
    bewildering variety of disguises. What once took days and weeks to
    communicate from a spy to his handler may now occur in milliseconds.
    Advanced encryption techniques may be utilized to additionally mask data
    that may later be imbedded into a digital scan, voice, music or television
    signal transmitted or received anywhere in the world. Even the world's most
    powerful computers lack the processing power to analyze trillions of bits of
    data for patterns to indicate possible imbedded messages.

    Analysis

    The closest the world came to a true "Orwellian" state was in East Germany
    during height of the Cold War. Massive programs of the MfS (Ministry for
    state Security) aimed at opening and photographing foreign mail and
    recording hundreds of thousands of conversations and phone calls resulted in
    a sea of information that overwhelmed the human capabilities in place to
    transcribe and analyze the results. Even if a great secret had eventually
    been captured, the likelihood that it would be transcribed and analyzed in
    time to be useful was naught. Without modern computers and the resulting
    analysis, the entire East German state eventually swamped itself in a sea of
    information.

    The analysts have long been the "unsung heroes" of the spy world. With
    little fanfare they accumulate bits of information from sources around the
    world and convert them into a useful intelligence product -- information
    needed by political and military leaders to make better decisions. More
    powerful computers, supplemented by artificial intelligence programs and
    neural networks, scan information from all sources to discern patterns and
    make predictions that defy human intuition. The resulting analysis may be a
    weather pattern and resulting grain harvest in a foreign country predicted
    years in advance. Though apparently innocuous, such vital economic
    information becomes part of the finished "intelligence product" and
    potentially shapes foreign policy.

    Counterintelligence

    Counterspies will be forced to adapt and accelerate the use of digital tools
    in an effort to catch foreign spies. Hostile services will resort to
    powerful neural networks and massive databases to analyze information about
    individuals to identify and apprehend foreign spies.

    Imagine the difficulties in establishing "legend" and "cover" in the digital
    world. Traditional identity details such as address, profession, association
    membership, etc. are now subjected to a new level of scrutiny using the
    Internet. It was once sufficient for an "NOC" (Non-Official Cover), a CIA
    term for a representative working or traveling abroad without diplomatic
    immunity, to use a driver's license listing his home address, and a business
    card stating his profession to confirm his identity. However, such simple
    details can be quickly challenged by using the Internet to search local
    property tax records, voting records, professional association memberships,
    etc. Establishing an effective cover and legend now requires the investment
    of additional resources and planning in the digital age.

    Old techniques with new applications

    During World War II, the OSS (U.S. Office of Strategic Services) and SOE
    (British Special Operations Executive) coordinated resistance activities in
    occupied Europe to disrupt German communications, transportation and
    manufacturing. These daring individuals risked death to sabotage telephone
    poles, derail trains and delay the shipment of raw material to factories
    producing war materials.

    In the new world of the digital spy, these same activities can be
    accomplished, at no personal risk, from a computer terminal thousands of
    miles away. By digitally sabotaging enemy computer networks, cyber-spies can
    accomplish the same result as their OSS and SOE predecessors. The
    vulnerability of the national information infrastructure of most countries
    -- the interlocking computer networks that regulate communication, commerce
    and defense -- make Pearl Harbor in 1941 appear well protected. At the same
    time, billions of dollars are being spent to shore up unprotected computer
    networks, and accelerated programs are being developed to exploit the
    computer networks of our enemies as we prepare for future "cyber wars."

    Computer viruses have been developed and deployed that will be activated in
    time of war. Imagine the consequence of embedding a "Trojan horse" in the
    operating system software that runs 90 percent of the computers of both
    friends and foes. A "Trojan horse," once activated, can selectively disable
    the computer infrastructure of a hostile opponent and cripple its economy,
    communications and defense. The war is over before it has begun.

    Assassination was once considered as a tool of warfare and tactically
    applied or attempted by some intelligence services during World War II.
    During the Cold War, the Soviet bloc utilized assassination to silence
    exiles living abroad -- the KGB assassinations of Ukrainian exiles Rebet and
    Bandera in West Germany, as well as the infamous Bulgarian "umbrella
    assassination" of Georgy Markov in London.

    In the digital world, however, potential targets of assassination have
    shifted. Even with the emphasis of advanced computer developments, all
    nations depend on imbedded computer chips of varying age -- sometimes
    decades old. These critically important components control the switching
    systems in power grids, telephone systems and transportation networks. The
    devastating effect of losing an antiquated but functioning system becomes a
    reality when the key person charged with its upkeep is eliminated. The
    result of assassinating a political leader pales when compared with the
    effect in future wars of eliminating key computer programmers and network
    specialists.

    For professional intelligence services, their primary goal is, and will
    remain, the acquisition of information, not murder. Oleg Tsarev, a retired
    officer of the KGB's First Chief Directorate and author, accurately stated
    that "intelligence stops when you pick up a gun."

    The new villains

    Former CIA Director James Woolsey stated that with the end of the Cold War,
    the great Soviet dragon was slain. He wryly noted, however, that in its
    place the intelligence services of the United States are facing a
    "bewildering variety of poisonous snakes that have been let loose in a dark
    jungle; it may have been easier to watch the dragon."

    The single greatest threat to world peace in the early part of the next
    century will be the utilization of weapons of mass destruction -- nuclear,
    chemical, biological and digital -- by fundamentalist terrorist
    organizations. These groups are already using the Internet to:

    ++ Recruit and communicate members with similar fundamentalist beliefs.

    ++ Coordinate terrorist activities with other aligned groups that share
    interests in a common outcome.

    ++ Raise money through computer based cyber-crime.

    ++ Attack the national information infrastructures of hostile countries from
    thousands of miles away.

    The CIA and other intelligence services must operate with shrinking budgets
    and manpower -- the CIA will shrink 25 percent from its peak -- but confront
    an array of new threats to national interests in different parts of the
    globe. To meet these challenges, all intelligence services will be forced to
    rely on digital solutions, massive computers and artificial intelligence in
    linked computer networks and databases to compensate for the reduction of
    people and resources.

    The traditional world of spies exists now only in fiction. Those
    intelligence services that most effectively identify, develop and implement
    the tools and techniques of the "cyber-spy" will provide their citizens with
    an incalculable advantage going into the new century.

      H. Keith Melton is a world-renowned expert on espionage and
      a member of the board of advisers of the National Historical
      Intelligence Museum in Washington D.C.  A consultant to U.S.
      intelligence agencies on historical espionage equipment, he
      is the author of a number of acclaimed books on the subject,
      including "The Ultimate Spy Book."

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