U.S. Is Target of Economic Spies, CIA Chief Says

Nearly 20 foreign governments in Asia, Europe, the Middle East and Latin America are involved in economic spying on the United States, CIA Director Robert Gates said Wednesday.

“In a world that increasingly measures national power . . . in economic as well as military terms, many foreign intelligence services” are turning their sights to stealing American technology and trade secrets, Gates told a House Judiciary subcommittee.

Foreign nations seek inside information on U.S. government policy deliberations that affect trade and investments, as well as information about contract bids, financial data and banking, Gates said. And they sometimes seek to influence business and government decisions covertly, he added.

Gates did not name specific countries, but said they include some formerly communist nations and some regarded as friends of the United States.

“Some countries with whom we have had good relations may adopt a two-track approach,” he said, “cooperating with us at the level of diplomacy while engaging in adversarial intelligence collection.”

Gates added that he could offer no proof of a trend toward increased economic spying by advanced industrial nations.

But Gerard P. Burke, a consultant who advises corporations on security and counterespionage, testified that Russia has boosted its economic spying efforts and called China an “even more aggressive” international snoop. France, Israel, Switzerland, Sweden and Great Britain also have official industrial spies, he said.

The issue has taken on importance, not only for the deployment of U.S. counterintelligence forces, but has added to a dispute between American business and government over how far companies can go to protect themselves.

Corporations want to make use of readily available technology to encrypt, or scramble, their telephone and data transmissions to make it harder for foreign government and corporate spies to intercept them. But the spread of encryption technology has a spillover effect on law enforcement, which could lose its ability to wiretap, a traditional tool for catching crooks.

At the same hearing, FBI Director William Sessions said his bureau is “nearing the point where we will be denied access on a routine basis” to telephone communications. He asked that Congress require any encryption technology to be equipped with a feature that will allow the FBI to eavesdrop.