|  | 
| SIM Cards | 
AMERICAN AND BRITISH spies hacked into the internal 
computer network of the largest manufacturer of SIM cards in the world, 
stealing encryption keys used to protect the privacy of cellphone 
communications across the globe, according to top-secret documents 
provided to The Intercept by National Security Agency whistleblower Edward Snowden.
The hack was perpetrated by a joint unit consisting of operatives 
from the NSA and its British counterpart Government Communications 
Headquarters, or GCHQ. The breach, detailed in a secret 2010 GCHQ 
document, gave the surveillance agencies the potential to secretly 
monitor a large portion of the world’s cellular communications, 
including both voice and data.
The company targeted by the intelligence agencies, Gemalto, is a 
multinational firm incorporated in the Netherlands that makes the chips 
used in mobile phones and next-generation credit cards. Among its 
clients are AT&T, T-Mobile, Verizon, Sprint and some 450 wireless 
network providers around the world. The company operates in 85 countries
 and has more than 40 manufacturing facilities. One of its three global 
headquarters is in Austin, Texas and it has a large factory in 
Pennsylvania.
In all, Gemalto produces some 2 billion SIM cards a year. Its motto is “Security to be Free.”
With these stolen encryption keys, intelligence agencies can monitor 
mobile communications without seeking or receiving approval from telecom
 companies and foreign governments. Possessing the keys also sidesteps 
the need to get a warrant or a wiretap, while leaving no trace on the 
wireless provider’s network that the communications were intercepted. 
Bulk key theft additionally enables the intelligence agencies to unlock 
any previously encrypted communications they had already intercepted, 
but did not yet have the ability to decrypt.
As part of the covert operations against Gemalto, spies from GCHQ — 
with support from the NSA — mined the private communications of 
unwitting engineers and other company employees in multiple countries.
Gemalto was totally oblivious to the penetration of its systems — and
 the spying on its employees. “I’m disturbed, quite concerned that this 
has happened,” Paul Beverly, a Gemalto executive vice president, told The Intercept.
 “The most important thing for me is to understand exactly how this was 
done, so we can take every measure to ensure that it doesn’t happen 
again, and also to make sure that there’s no impact on the telecom 
operators that we have served in a very trusted manner for many years. 
What I want to understand is what sort of ramifications it has, or could
 have, on any of our customers.” He added that “the most important thing
 for us now is to understand the degree” of the breach.
Leading privacy advocates and security experts say that the theft of 
encryption keys from major wireless network providers is tantamount to a
 thief obtaining the master ring of a building superintendent who holds 
the keys to every apartment. “Once you have the keys, decrypting traffic
 is trivial,” says Christopher Soghoian, the principal technologist for 
the American Civil Liberties Union. “The news of this key theft will 
send a shock wave through the security community.”
The massive key theft is “bad news for phone security. Really bad news.”
Beverly said that after being contacted by The Intercept, 
Gemalto’s internal security team began on Wednesday to investigate how 
their system was penetrated and could find no trace of the hacks. When 
asked if the NSA or GCHQ had ever requested access to 
Gemalto-manufactured encryption keys, Beverly said, “I am totally 
unaware. To the best of my knowledge, no.”
According to one secret GCHQ slide, the British intelligence agency 
penetrated Gemalto’s internal networks, planting malware on several 
computers, giving GCHQ secret access. We “believe we have their entire 
network,” the slide’s author boasted about the operation against 
Gemalto.
Additionally, the spy agency targeted unnamed cellular companies’ 
core networks, giving it access to “sales staff machines for customer 
information and network engineers machines for network maps.” GCHQ also 
claimed the ability to manipulate the billing servers of cell companies 
to “suppress” charges in an effort to conceal the spy agency’s secret 
actions against an individual’s phone. Most significantly, GCHQ also 
penetrated “authentication servers,” allowing it to decrypt data and 
voice communications between a targeted individual’s phone and their 
telecom provider’s network. A note accompanying the slide asserted that 
the spy agency was “very happy with the data so far and [was] working 
through the vast quantity of product.”
The Mobile Handset Exploitation Team (MHET), whose existence has 
never before been disclosed, was formed in April 2010 to target 
vulnerabilities in cell phones. One of its main missions was to covertly
 penetrate computer networks of corporations that manufacture SIM cards,
 as well as those of wireless network providers. The team included 
operatives from both GCHQ and the NSA.
While the FBI and other U.S. agencies can obtain court orders 
compelling U.S.-based telecom companies to allow them to wiretap or 
intercept the communications of their customers, on the international 
front this type of data collection is much more challenging. Unless a 
foreign telecom or foreign government grants access to their citizens’ 
data to a U.S. intelligence agency, the NSA or CIA would have to hack 
into the network or specifically target the user’s device for a more 
risky “active” form of surveillance that could be detected by 
sophisticated targets. Moreover, foreign intelligence agencies would not
 allow U.S. or U.K. spy agencies access to the mobile communications of 
their heads of state or other government officials.
“It’s unbelievable. Unbelievable,” said Gerard Schouw, a member of 
the Dutch Parliament when told of the spy agencies’ actions. Schouw, the
 intelligence spokesperson for D66, the largest opposition party in the 
Netherlands, told The Intercept, “We don’t want to have the 
secret services from other countries doing things like this.” Schouw 
added that he and other lawmakers will ask the Dutch government to 
provide an official explanation and to clarify whether the country’s 
intelligence services were aware of the targeting of Gemalto, whose 
official headquarters is in Amsterdam.
Last November, the Dutch government amended its constitution to 
include explicit protection for the privacy of digital communications, 
including those made on mobile devices. “We have, in the Netherlands, a 
law on the [activities] of secret services. And hacking is not allowed,”
 he said. Under Dutch law, the interior minister would have to sign off 
on such operations by foreign governments’ intelligence agencies. “I 
don’t believe that he has given his permission for these kind of 
actions.”
The U.S. and British intelligence agencies pulled off the encryption 
key heist in great stealth, giving them the ability to intercept and 
decrypt communications without alerting the wireless network provider, 
the foreign government or the individual user that they have been 
targeted. “Gaining access to a database of keys is pretty much game over
 for cellular encryption,” says Matthew Green, a cryptography specialist
 at the Johns Hopkins Information Security Institute. The massive key 
theft is “bad news for phone security. Really bad news.”
 
 
AS CONSUMERS BEGAN to 
adopt cellular phones en masse in the mid-1990s, there were no effective
 privacy protections in place. Anyone could buy a cheap device from 
RadioShack capable of intercepting calls placed on mobile phones. The 
shift from analog to digital networks introduced basic encryption 
technology, though it was still crackable by tech savvy computer science
 graduate students, as well as the FBI and other law enforcement 
agencies, using readily available equipment.
Today, second-generation (2G) phone technology, which relies on a 
deeply flawed encryption system, remains the dominant platform globally,
 though U.S. and European cell phone companies now use 3G, 4G and LTE 
technology in urban areas. These include more secure, though not 
invincible, methods of encryption, and wireless carriers throughout the 
world are upgrading their networks to use these newer technologies.
It is in the context of such growing technical challenges to data 
collection that intelligence agencies, such as the NSA, have become 
interested in acquiring cellular encryption keys. “With old-fashioned 
[2G], there are other ways to work around cellphone security without 
those keys,” says Green, the Johns Hopkins cryptographer. “With newer 
3G, 4G and LTE protocols, however, the algorithms aren’t as vulnerable, 
so getting those keys would be essential.”
The privacy of all mobile communications — voice calls, text messages
 and Internet access — depends on an encrypted connection between the 
cell phone and the wireless carrier’s network, using keys stored on the 
SIM, a tiny chip smaller than a postage stamp which is inserted into the
 phone. All mobile communications on the phone depend on the SIM, which 
stores and guards the encryption keys created by companies like Gemalto.
 SIM cards can be used to store contacts, text messages, and other 
important data, like one’s phone number. In some countries, SIM cards 
are used to transfer money. As The Intercept reported last year, having the wrong SIM card can make you the target of a drone strike.
SIM cards were not invented to protect individual communications — 
they were designed to do something much simpler: ensure proper billing 
and prevent fraud, which was pervasive in the early days of cell phones.
 Soghoian compares the use of encryption keys on SIM cards to the way 
Social Security numbers are used today. “Social security numbers were 
designed in the 1930s to track your contributions to your government 
pension,” he says. “Today they are used as a quasi national identity 
number, which was never their intended purpose.”
Because the SIM card wasn’t created with call confidentiality in 
mind, the manufacturers and wireless carriers don’t make a great effort 
to secure their supply chain. As a result, the SIM card is an extremely 
vulnerable component of a mobile phone. “I doubt anyone is treating 
those things very carefully,” says Green. “Cell companies probably don’t
 treat them as essential security tokens. They probably just care that 
nobody is defrauding their networks.” The ACLU’s Soghoian adds, “These 
keys are so valuable that it makes sense for intel agencies to go after 
them.”
As a general rule, phone companies do not manufacture SIM cards, nor 
program them with secret encryption keys. It is cheaper and more 
efficient for them to outsource this sensitive step in the SIM card 
production process. They purchase them in bulk with the keys pre-loaded 
by other corporations. Gemalto is the largest of these SIM 
“personalization” companies.
After a SIM card is manufactured, the encryption key, known as a 
“Ki,” is burned directly onto the chip. A copy of the key is also given 
to the cellular provider, allowing its network to recognize an 
individual’s phone. 
In order for the phone to be able to connect to the 
wireless carriers’ network, the phone — with the help of the SIM — 
authenticates itself using the Ki that has been programmed onto the SIM.
 The phone conducts a secret “handshake” that validates that the Ki on 
the SIM matches the Ki held by the mobile company. Once that happens, 
the communications between the phone and the network are encrypted. Even
 if GCHQ or the NSA were to intercept the phone signals as they are 
transmitted through the air, the intercepted data would be a garbled 
mess. Decrypting it can be challenging and time-consuming. Stealing the 
keys, on the other hand, is beautifully simple, from the intelligence 
agencies’ point of view, as the pipeline for producing and distributing 
SIM cards was never designed to thwart mass surveillance efforts.
One of the creators of the encryption protocol that is widely used 
today for securing emails, Adi Shamir, famously asserted: “Cryptography 
is typically bypassed, not penetrated.” In other words, it is much 
easier (and sneakier) to open a locked door when you have the key than 
it is to break down the door using brute force. While the NSA and GCHQ 
have substantial resources dedicated to breaking encryption, it is not 
the only way — and certainly not always the most efficient — to get at 
the data they want. “NSA has more mathematicians on its payroll than any
 other entity in the U.S.,” says the ACLU’s Soghoian. “But the NSA’s 
hackers are way busier than its mathematicians.”
GCHQ and the NSA could have taken any number of routes to steal SIM 
encryption keys and other data. They could have physically broken into a
 manufacturing plant. They could have broken into a wireless carrier’s 
office. They could have bribed, blackmailed or coerced an employee of 
the manufacturer or cell phone provider. But all of that comes with 
substantial risk of exposure. In the case of Gemalto, hackers working 
for GCHQ remotely penetrated the company’s computer network in order to 
steal the keys in bulk as they were en route to the wireless network 
providers.
SIM card “personalization” companies like Gemalto ship hundreds of 
thousands of SIM cards at a time to mobile phone operators across the 
world. International shipping records obtained by The Intercept
 show that in 2011, Gemalto shipped 450,000 smart cards from its plant 
in Mexico to Germany’s Deutsche Telekom in just one shipment.
In order for the cards to work and for the phones’ communications to 
be secure, Gemalto also needs to provide the mobile company with a file 
containing the encryption keys for each of the new SIM cards. These 
master key files could be shipped via FedEx, DHL, UPS or another snail 
mail provider. More commonly, they could be sent via email or through 
File Transfer Protocol, FTP, a method of sending files over the 
Internet.
The moment the master key set is generated by Gemalto or another 
personalization company, but before it is sent to the wireless carrier, 
is the most vulnerable moment for interception. “The value of getting 
them at the point of manufacture is you can presumably get a lot of keys
 in one go, since SIM chips get made in big batches,” says Green, the 
cryptographer. “SIM cards get made for lots of different carriers in one
 facility.” In Gemalto’s case, GCHQ hit the jackpot, as the company 
manufactures SIMs for hundreds of wireless network providers, including 
all of the leading U.S. — and many of the largest European — companies.
But obtaining the encryption keys while Gemalto still held them required finding a way into the company’s internal systems.
Diagram from a top-secret GCHQ slide.
TOP-SECRET GCHQ 
documents reveal that the intelligence agencies accessed the email and 
Facebook accounts of engineers and other employees of major telecom 
corporations and SIM card manufacturers in an effort to secretly obtain 
information that could give them access to millions of encryption keys. 
They did this by utilizing the NSA’s X-KEYSCORE program, which allowed 
them access to private emails hosted by the SIM card and mobile 
companies’ servers, as well as those of major tech corporations, 
including Yahoo! and Google.
In effect, GCHQ clandestinely cyberstalked Gemalto employees, 
scouring their emails in an effort to find people who may have had 
access to the company’s core networks and Ki-generating systems. The 
intelligence agency’s goal was to find information that would aid in 
breaching Gemalto’s systems, making it possible to steal large 
quantities of encryption keys. The agency hoped to intercept the files 
containing the keys as they were transmitted between Gemalto and its 
wireless network provider customers.
GCHQ operatives identified key individuals and their positions within
 Gemalto and then dug into their emails. In one instance, GCHQ zeroed in
 on a Gemalto employee in Thailand who they observed sending 
PGP-encrypted files, noting that if GCHQ wanted to expand its Gemalto 
operations, “he would certainly be a good place to start.” They did not 
claim to have decrypted the employee’s communications, but noted that 
the use of PGP could mean the contents were potentially valuable.
The cyberstalking was not limited to Gemalto. GCHQ operatives wrote a
 script that allowed the agency to mine the private communications of 
employees of major telecommunications and SIM “personalization” 
companies for technical terms used in the assigning of secret keys to 
mobile phone customers. Employees for the SIM card manufacturers and 
wireless network providers were labeled as “known individuals and 
operators targeted” in a top-secret GCHQ document.
According to that April 2010 document, “PCS Harvesting at Scale,” 
hackers working for GCHQ focused on “harvesting” massive amounts of 
individual encryption keys “in transit between mobile network operators 
and SIM card personalisation centres” like Gemalto. The spies “developed
 a methodology for intercepting these keys as they are transferred 
between various network operators and SIM card providers.” By that time,
 GCHQ had developed “an automated technique with the aim of increasing 
the volume of keys that can be harvested.”
The PCS Harvesting document acknowledged that, in searching for 
information on encryption keys, GCHQ operatives would undoubtedly vacuum
 up “a large number of unrelated items” from the private communications 
of targeted employees. “[H]owever an analyst with good knowledge of the 
operators involved can perform this trawl regularly and spot the 
transfer of large batches of [keys].”
The document noted that many SIM card manufacturers transferred the 
encryption keys to wireless network providers “by email or FTP with 
simple encryption methods that can be broken … or occasionally with no 
encryption at all.” To get bulk access to encryption keys, all the NSA 
or GCHQ needed to do was intercept emails or file transfers as they were
 sent over the Internet — something both agencies already do millions of
 times per day. A footnote in the 2010 document observed that the use of
 “strong encryption products … is becoming increasingly common” in 
transferring the keys.
In its key harvesting “trial” operations in the first quarter of 
2010, GCHQ successfully intercepted keys used by wireless network 
providers in Iran, Afghanistan, Yemen, India, Serbia, Iceland and 
Tajikistan. But, the agency noted, its automated key harvesting system 
failed to produce results against Pakistani networks, denoted as 
“priority targets” in the document, despite the fact that GCHQ had a 
store of Kis from two providers in the country, Mobilink and Telenor. 
“[I]t is possible that these networks now use more secure methods to 
transfer Kis,” the document concluded.
From December 2009 through March 2010, a month before the Mobile 
Handset Exploitation Team was formed, GCHQ conducted a number of trials 
aimed at extracting encryption keys and other personalized data for 
individual phones. In one two-week period, they accessed the emails of 
130 people associated with wireless network providers or SIM card 
manufacturing and personalization. This operation produced nearly 8,000 
keys matched to specific phones in 10 countries. In another two-week 
period, by mining just 6 email addresses, they produced 85,000 keys. At 
one point in March 2010, GCHQ intercepted nearly 100,000 keys for mobile
 phone users in Somalia. By June, they’d compiled 300,000. “Somali 
providers are not on GCHQ’s list of interest,” the document noted. 
“[H]owever, this was usefully shared with NSA.”
The GCHQ documents only contain statistics for three months of 
encryption key theft in 2010. During this period, millions of keys were 
harvested. The documents stated explicitly that GCHQ had already created
 a constantly evolving automated process for bulk harvesting of keys. 
They describe active operations targeting Gemalto’s personalization 
centers across the globe, as well as other major SIM card manufacturers 
and the private communications of their employees.
A top-secret NSA document asserted that, as of 2009, the U.S. spy 
agency already had the capacity to process between 12 and 22 million 
keys per second for later use against surveillance targets. In the 
future, the agency predicted, it would be capable of processing more 
than 50 million per second. The document did not state how many keys 
were actually processed, just that the NSA had the technology to perform
 such swift, bulk operations. It is impossible to know how many keys 
have been stolen by the NSA and GCHQ to date, but, even using 
conservative math, the numbers are likely staggering.
GCHQ assigned “scores” to more than 150 individual email addresses 
based on how often the users mentioned certain technical terms, and then
 intensified the mining of those individuals’ accounts based on 
priority. The highest scoring email address was that of an employee of 
Chinese tech giant Huawei, which the U.S. has repeatedly accused of 
collaborating with Chinese intelligence. In all, GCHQ harvested the 
emails of employees of hardware companies that manufacture phones, such 
as Ericsson and Nokia; operators of mobile networks, such as MTN 
Irancell and Belgacom; SIM card providers, such as Bluefish and Gemalto;
 and employees of targeted companies who used email providers such as 
Yahoo! and Google. During the three-month trial, the largest number of 
email addresses harvested were those belonging to Huawei employees, 
followed by MTN Irancell. The third largest class of emails harvested in
 the trial were private Gmail accounts, presumably belonging to 
employees at targeted companies.
The GCHQ program targeting Gemalto was called DAPINO GAMMA. In 2011, 
GCHQ launched operation HIGHLAND FLING to mine the email accounts of 
Gemalto employees in France and Poland. A top-secret document on the 
operation stated that one of the aims was “getting into French HQ” of 
Gemalto “to get in to core data repositories.” France, home to one of 
Gemalto’s global headquarters, is the nerve center of the company’s 
worldwide operations. Another goal was to intercept private 
communications of employees in Poland that “could lead to penetration 
into one or more personalisation centers” — the factories where the 
encryption keys are burned onto SIM cards.
As part of these operations, GCHQ operatives acquired the usernames 
and passwords for Facebook accounts of Gemalto targets. An internal 
top-secret GCHQ wiki on the program from May 2011 indicated that GCHQ 
was in the process of “targeting” more than a dozen Gemalto facilities 
across the globe, including in Germany, Mexico, Brazil, Canada, China, 
India, Italy, Russia, Sweden, Spain, Japan and Singapore.
The document also stated that GCHQ was preparing similar key theft 
operations against one of Gemalto’s competitors, Germany-based SIM card 
giant Giesecke and Devrient.
On January 17, 2014, President Barack Obama gave a major address on 
the NSA spying scandal. “The bottom line is that people around the 
world, regardless of their nationality, should know that the United 
States is not spying on ordinary people who don’t threaten our national 
security and that we take their privacy concerns into account in our 
policies and procedures,” he said.
The monitoring of the lawful communications of employees of major 
international corporations shows that such statements by Obama, other 
U.S. officials and British leaders — that they only intercept and 
monitor the communications of known or suspected criminals or terrorists
 — were untrue. “The NSA and GCHQ view the private communications of 
people who work for these companies as fair game,” says the ACLU’s 
Soghoian. “These people were specifically hunted and targeted by 
intelligence agencies, not because they did anything wrong, but because 
they could be used as a means to an end.”
 
 
THERE ARE TWO basic 
types of electronic or digital surveillance: passive and active. All 
intelligence agencies engage in extensive passive surveillance, which 
means they collect bulk data by intercepting communications sent over 
fiber optic cables, radio waves or wireless devices.
Intelligence agencies place high power antennas, known as “spy 
nests,” on the top of their countries’ embassies and consulates, which 
are capable of vacuuming up data sent to or from mobile phones in the 
surrounding area. The joint NSA/CIA Special Collection Service is the 
lead entity that installs and mans these nests for the United States. An
 embassy situated near a parliament or government agency could easily 
intercept the phone calls and data transfers of the mobile phones used 
by foreign government officials. The U.S. embassy in Berlin, for 
instance, is located a stone’s throw from the Bundestag. But if the 
wireless carriers are using stronger encryption, which is built into 
modern 3G, 4G and LTE networks, then intercepted calls and other data 
would be more difficult to crack, particularly in bulk. If the 
intelligence agency wants to actually listen to or read what is being 
transmitted, they would need to decrypt the encrypted data.
Active surveillance is another option. This would require government 
agencies to “jam” a 3G or 4G network, forcing nearby phones onto 2G. 
Once forced down to the less secure 2G technology, the phone can be 
tricked into connecting to a fake cell tower operated by an intelligence
 agency. This method of surveillance, though effective, is risky, as it 
leaves a digital trace that counter-surveillance experts from foreign 
governments could detect.
Stealing the Kis solves all of these problems. This way, intelligence
 agencies can safely engage in passive, bulk surveillance without having
 to decrypt data and without leaving any trace whatsoever.
“Key theft enables the bulk, low-risk surveillance of encrypted 
communications,” the ACLU’s Soghoian says. “Agencies can collect all the
 communications and then look through them later. With the keys, they 
can decrypt whatever they want, whenever they want. It’s like a time 
machine, enabling the surveillance of communications that occurred 
before someone was even a target.”
Neither the NSA nor GCHQ would comment specifically on the key theft 
operations. In the past, they have argued more broadly that breaking 
encryption is a necessary part of tracking terrorists and other 
criminals. “It is longstanding policy that we do not comment on 
intelligence matters,” a GCHQ official stated in an email, adding that 
the agency’s work is conducted within a “strict legal and policy 
framework” that ensures its activities are “authorized, necessary and 
proportionate,” with proper oversight, which is the standard response 
the agency has provided for previous stories published by The Intercept.
 The agency also said, “[T]he UK’s interception regime is entirely 
compatible with the European Convention on Human Rights.” The NSA 
declined to offer any comment.
It is unlikely that GCHQ’s pronouncement about the legality of its 
operations will be universally embraced in Europe. “It is governments 
massively engaging in illegal activities,” says Sophie in’t Veld, a 
Dutch member of the European Parliament. “If you are not a government 
and you are a student doing this, you will end up in jail for 30 years.”
 Veld, who chaired the European Parliament’s recent inquiry into mass 
surveillance exposed by Snowden, told The Intercept: “The 
secret services are just behaving like cowboys. Governments are behaving
 like cowboys and nobody is holding them to account.”
The Intercept’s Laura Poitras has previously reported that 
in 2013 Australia’s signals intelligence agency, a close partner of the 
NSA, stole some 1.8 million encryption keys from an Indonesian wireless 
carrier.
A few years ago, the FBI reportedly dismantled several of 
transmitters set up by foreign intelligence agencies around the 
Washington DC area, which could be used to intercept cell phone 
communications. Russia, China, Israel and other nations use similar 
technology as the NSA across the world. If those governments had the 
encryption keys for major U.S. cell phone companies’ customers, such as 
those manufactured by Gemalto, mass snooping would be simple. “It would 
mean that with a few antennas placed around Washington DC, the Chinese 
or Russian governments could sweep up and decrypt the communications of 
members of Congress, U.S. agency heads, reporters, lobbyists and 
everyone else involved in the policymaking process and decrypt their 
telephone conversations,” says Soghoian.
“Put a device in front of the UN, record every bit you see going over
 the air. Steal some keys, you have all those conversations,” says 
Green, the Johns Hopkins cryptographer. And it’s not just spy agencies 
that would benefit from stealing encryption keys. “I can only imagine 
how much money you could make if you had access to the calls made around
 Wall Street,” he adds.
GCHQ slide.
THE BREACH OF Gemalto’s
 computer network by GCHQ has far-reaching global implications. The 
company, which brought in $2.7 billion in revenue in 2013, is a global 
leader in digital security, producing banking cards, mobile payment 
systems, two-factor authentication devices used for online security, 
hardware tokens used for securing buildings and offices, electronic 
passports and identification cards. It provides chips to Vodafone in 
Europe and France’s Orange, as well as EE, a joint venture in the U.K. 
between France Telecom and Deutsche Telekom. Royal KPN, the largest 
Dutch wireless network provider, also uses Gemalto technology.
In Asia, Gemalto’s chips are used by China Unicom, Japan’s NTT and 
Taiwan’s Chungwa Telecom, as well as scores of wireless network 
providers throughout Africa and the Middle East. The company’s security 
technology is used by more than 3,000 financial institutions and 80 
government organizations. Among its clients are Visa, Mastercard, 
American Express, JP Morgan Chase and Barclays. It also provides chips 
for use in luxury cars, including those made by Audi and BMW.
In 2012, Gemalto won a sizable contract, worth $175 million, from the
 U.S. government to produce the covers for electronic U.S. passports, 
which contain chips and antennas that can be used to better authenticate
 travelers. As part of its contract, Gemalto provides the 
personalization and software for the microchips implanted in the 
passports. The U.S. represents Gemalto’s single largest market, 
accounting for some 15 percent of its total business. This raises the 
question of whether GCHQ, which was able to bypass encryption on mobile 
networks, has the ability to access private data protected by other 
Gemalto products created for banks and governments.
As smart phones become smarter, they are increasingly replacing 
credit cards and cash as a means of paying for goods and services. When 
Verizon, AT&T and T-Mobile formed an alliance in 2010 to jointly 
build an electronic pay system to challenge Google Wallet and Apple Pay,
 they purchased Gemalto’s technology for their program, known as 
Softcard. (Until July 2014, it previously went by the unfortunate name 
of “ISIS Mobile Wallet.”) Whether data relating to that, and other 
Gemalto security products, has been compromised by the GCHQ and NSA is 
unclear. Both intelligence agencies declined to answer any specific 
questions for this story.
Signal, iMessage, WhatsApp, Silent Phone.
PRIVACY ADVOCATES and 
security experts say it would take billions of dollars, significant 
political pressure, and several years to fix the fundamental security 
flaws in the current mobile phone system that NSA, GCHQ and other 
intelligence agencies regularly exploit.
A current gaping hole in the protection of mobile communications is 
that cell phones and wireless network providers do not support the use 
of Perfect Forward Security (PFS), a form of encryption designed to 
limit the damage caused by theft or disclosure of encryption keys. PFS, 
which is now built into modern web browsers and used by sites like 
Google and Twitter, works by generating unique encryption keys for each 
communication or message, which are then discarded. Rather than using 
the same encryption key to protect years’ worth of data, as the 
permanent Kis on SIM cards can, a new key might be generated each 
minute, hour or day, and then promptly destroyed. Because cell phone 
communications do not utilize PFS, if an intelligence agency has been 
“passively” intercepting someone’s communications for a year and later 
acquires the permanent encryption key, it can go back and decrypt all of
 those communications. If mobile phone networks were using PFS, that 
would not be possible — even if the permanent keys were later stolen.
The only effective way for individuals to protect themselves from Ki 
theft-enabled surveillance is to use secure communications software, 
rather than relying on SIM card-based security. Secure software includes
 email and other apps that use Transport Layer Security (TLS), the 
mechanism underlying the secure HTTPS web protocol. The email clients 
included with Android phones and iPhones support TLS, as do large email 
providers like Yahoo! and Google.
Apps like TextSecure and Silent Text are secure alternatives to SMS 
messages, while Signal, RedPhone and Silent Phone encrypt voice 
communications. Governments still may be able to intercept 
communications, but reading or listening to them would require hacking a
 specific handset, obtaining internal data from an email provider, or 
installing a bug in a room to record the conversations.
“We need to stop assuming that the phone companies will provide us 
with a secure method of making calls or exchanging text messages,” says 
Soghoian.
———
Documents published with this article:
- CNE Access to Core Mobile Networks
- Where Are These Keys?
- CCNE Successes Jan10-Mar10 Trial
- DAPINO GAMMA CNE Presence Wiki
- DAPINO GAMMA Gemalto Yuaawaa Wiki
- DAPINO GAMMA Target Personalisation Centres Gemalto Wiki
- IMSIs Identified with Ki Data for Network Providers Jan10-Mar10 Trial
- CCNE Stats Summaries Jan10-Mar10 Trial
- CCNE Email Harvesting Jan10-Mar10 Trial
- CCNE Email Addresses Jan10-Mar10 Trial
- PCS Harvesting at Scale
By Jeremy Scahill and Josh Begley
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Additional reporting by Andrew Fishman and Ryan Gallagher. 
Sheelagh McNeill, Morgan Marquis-Boire, Alleen Brown, Margot Williams, 
Ryan Devereaux and Andrea Jones contributed to this story.
Culled from: The Intercept 




 
 
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