Torture Island: Where Offshore Meets the National Surveillance State

[Ed Jewett]

SUNDAY, SEPTEMBER 4, 2011
Torture Island: Where Offshore Meets the National Surveillance State



From shady Wall Street banks and investment firms that rob people blind, to Western governments that prattle on about "democracy" and "human rights" while their favorite butchers torture and kill their own citizens, it's a sick, sad world growing sicker and sadder by the hour.

It certainly can't hurt when the U.S. Fifth Fleet has the back of those doing the killing, or when the killers are pampered ne'er-do-wells, a fabulously wealthy clique of hereditary princes for whom the word "medieval" was invented, who just so happen to lord over one of the planet's financial bolt holes.

Last month, Bloomberg Markets Magazine revealed that when "Bahraini jailers armed with stiff rubber hoses" beat 39-year-old school administrator and human rights activist Abdul Ghani Al Khanjar in a windowless dungeon in Manama, his jailers were armed "with another kind of weapon: transcripts of his text messages and details from personal mobile phone conversations."

"It was amazing," Al Khanjar told investigative journalists Vernon Silver and Ben Elgin. "How did they know about these?"

The answer is simple: from computers loaded with spy kit sold to Bahraini royals "by Siemens AG (SIE), and maintained by Nokia Siemens Networks and NSN's divested unit, Trovicor GmbH, according to two people whose positions at the companies gave them direct knowledge of the installations."

Back in February, political floodgates opened across the Middle East as American-allied dictators were toppled by enraged citizens in Tunisia and Egypt, and threatened to do the same in Bahrain when pro-democracy demonstrators took to the streets across the island nation.

The Al Khalifa clan responded as royals are wont to do: with brute force and considerable help from U.S. and Saudi "friends." Scores were killed and many hundreds of others, including medical personnel, were seized and "disappeared" into regime black holes.

As The Guardian reported, while "Bahrain's security forces are the backbone of the Al Khalifa regime," in recent years "large numbers of their personnel are recruited from other countries, including Jordan, Pakistan and Yemen" and "are reviled as mercenaries by Bahrainis."

But what of the gaggle of Western firms who hit the "sweet spot" selling despotic potentates everything from high-tech spy gear to machine guns and lethal gases: will they be "reviled as mercenaries" by media in the "democratic" West?

'Institutionalized Corruption'

It's hardly surprising that one of Siemens offloaded intelligence units, Trovicor, did a brisk business with Bahrain's secret state. After all, considering the firm's dubious track record and a corporate culture where "bribery was just a line item" according to The New York Times, why wouldn't they?

More than two years ago when a spate of corruption prosecutions were settled, Siemens wound up paying some $1.6 billion to the U.S. government under provisions of the Foreign Corrupt Practices Act, "the largest fine for bribery in modern corporate history."

Former mid-level executive, Reinhard Siekaczek, told reporters Siri Schubert and T. Christian Miller that "he was one of several people who arranged a torrent of payments that eventually streamed to well-placed officials around the globe, from Vietnam to Venezuela and from Italy to Israel."

"What is striking about Mr. Siekaczek's and prosecutors' accounts of those dealings," the Times averred, "which flowed through a web of secret bank accounts and shadowy consultants, is how entrenched corruption had become at a sprawling, sophisticated corporation that externally embraced the nostrums of a transparent global marketplace built on legitimate transactions."

The former executive said that between "2002 to 2006 he oversaw an annual bribery budget of about $40 million to $50 million at Siemens. Company managers and sales staff used the slush fund to cozy up to corrupt government officials worldwide."

"Bribery was Siemens's business model," Uwe Dolata, the spokesman for the association of federal criminal investigators in Germany told the Times. "Siemens had institutionalized corruption."

Such lucrative inducements to officials were meant to maintain the firm's "competitive edge" overseas in the branch Siekaczek oversaw, "which sold telecommunications equipment."

High-tech accouterments which ended up in the hands of Abdul Ghani Al Khanjar's torturers.

Ahmed Aldoseri, the director of information and communications technologies at Bahrain's Telecommunications Regulatory Authority told Bloomberg Markets, "If they have a transcript of an SMS message, it's because the security organ was monitoring the user at their monitoring center."

Inquiring minds can't help but wonder: did black euros flowing through one of Siemens slush funds grease the palms of corrupt interior ministry officials and then quietly vanish into an offshore bank controlled by cronies of Bahrain's hereditary royals?

A Global Hidey-Hole

Faced with depleting oil and gas reserves, Bahrain's industrial base has expanded rapidly over the past two decades and includes petrochemical, aluminum, oil refining, ship repairing and light manufacturing; it's share of GDP from these sectors, compared to other members of the Gulf Cooperation Council (GCC), is the highest in the region.

However, "liberal" banking regulations, secrecy laws and a sophisticated telecommunications infrastructure have attracted major Asian and Western institutional investors and investment banks. Drawn by the country's reputation as a no tax zone for foreigners and a freewheeling "no questions asked" regulatory climate, Bahrain is a haven for hot money.

A secret embassy cable published by WikiLeaks, 06MANAMA2003, informs us that "Bahrain has one of the most diversified economies in the Gulf Cooperation Council (GCC)."

Accordingly, "Bahrain has promoted itself as an international financial center in the Gulf region. It hosts a mix of: 375 diverse financial institutions, including 187 banks, of which 51 are wholesale banks (formerly referred to as off-shore banks or OBUs); 39 investment banks; and 25 commercial banks, of which 17 are foreign-owned. There are 31 representative offices of international banks."

Situated in the heart of the Middle East where the global oil trade recycles regional wealth into liquidity for financial markets, Bahrain and the other Gulf monarchies as they diversify into offshore finance, intersect and capture enormous outflows of cash hemorrhaging out of Africa, Asia, Europe and the Americas, steering hot money into hidey-holes for those in the know. Therefore, mass mobilizations in favor of messy things like democracy would hardly inspire confidence in the global owning class.

Nicholas Shaxson, the author of Treasure Islands: Uncovering the Damage of Offshore Banking and Tax Havens, tells us that offshore tax havens such as Bahrain's "are not exotic, murky sideshows at the fringes of the world economy: they lie at its centre. Half of world trade flows, at least on paper, through tax havens. Every multinational corporation uses them routinely. The biggest users of tax havens by far are not terrorists, spivs [black marketeers], celebrities or Mafiosi--but banks."

"Tax havens aren't just about tax," Shaxson writes. "They are about escape--escape from criminal laws, escape from creditors, escape from tax, escape from prudent financial regulation--above all, escape from democratic scrutiny and accountability. Tax havens get rich by taking fees for providing these escape routes. This is their core line of business. It is what they do."

"The vast network of Bahrain's banking system," the State Department informs us, "along with its geographical location in the Middle East as a transit point along the Gulf and into Southwest Asia, may attract money laundering activities. It is thought that the greatest risk of money laundering stems from questionable foreign proceeds that transit Bahrain."

And, like Siemens, which "had joined the international convention banning foreign bribery" in 1999, according to the State Department, "in 2001, the Government of Bahrain (GOB) enacted an anti-money laundering law that criminalizes the laundering of proceeds derived from any predicate offense."

Presumably that law, and a 2006 amendment which criminalized "the undeclared transfer of money across international borders for the purpose of money laundering or in support of terrorism," would also cover bribing state officials for purposes, let's say, of sweetening the pot for purchases of "telecommunications equipment," including surveillance suites targeting dissident Bahrainis.

Also in 2006, Bahrain implemented a Free Trade Agreement with the United States to go along with its status as a global offshore financial center. As a result, the organized workers' movement has been targeted by the government.

According to the Bahrain Center for Human Rights (BCHR), "authorities in Bahrain are stepping up repression of the country's trade union movement, with further suspensions and sackings of workers due to their actual or suspected participation in trade union and political actions earlier this year."

Since the pro-democracy uprising began, BCHR informs us that "some 2,600 workers" affiliated with the General Federation of Bahraini Trade Unions (GFBTU), "in both the public and private sector have been fired, with an additional 361 workers suspended. Despite numerous promises to the contrary, the government has largely failed to reinstate workers illegally dismissed."

It's a sure bet that the same surveillance gear used in wholesale raids against human rights' campaigners have also been trained upon Bahraini workers' organizations, proving once again that "free trade" means "freedom" to smash trade unions.

U.S. and Bahraini Intelligence: Thick as Thieves

Bahrain is home to the U.S. Fifth Fleet, the proverbial tip of imperialism's nautical spear responsible for naval operations in the Persian Gulf, the Red Sea, the Arabian Sea and the east coast of Africa as far south as Kenya.

And should the Obama administration, their Israeli pit bulls, or both, decide to up the ante with Iran, the Fifth Fleet would be called upon, as they were at the start of Bush's "shock and awe" campaign which destroyed Iraq, to launch air strikes and impose a naval blockade against that oil-rich nation.

Given Bahrain's strategic importance to Washington, and the regime's close links to the U.S. military and intelligence apparatus, Madame Clinton's expression of "deep concern" when security forces attacked unarmed protesters was the emptiest of gestures meant to divert the public's gaze from the criminal role played by the U.S. government during Bahrain's targeting of the pro-democracy movement.

This is borne out by secret embassy cables published by WikiLeaks. A December 2, 2009 communiqué from the American Embassy in Manama to former CIA Director Leon Panetta and then-Director of National Intelligence Dennis Blair, 09MANAMA681, informs us that "Director of BNSA [Bahrain National Security Agency] Sheikh Khalifa bin Abdallah Al Khalifa figures prominently into the King's efforts on reform and stability."

According to U.S. Ambassador J. Adam Ereli, "charged by the King to 'Bahrainize' and professionalize BNSA, Sheikh Khalifa is determined to rid BNSA of the last vestiges of British influence and grow BNSA into a world-class intelligence and security service with global reach."

"The secret police--the Bahrain national security agency, known in Arabic as the Mukhabarat--has undergone a process of 'Bahrainisation' in recent years after being dominated by the British until long after independence in 1971," The Guardian disclosed.

"Ian Henderson, who retired as its director in 1998, is still remembered as the 'Butcher of Bahrain' because of his alleged use of torture. A Jordanian official is currently described as the organisation's 'master torturer'."

"Sheikh Khalifa" according to the State Department, "understands well that if he is to fulfill his mandate of protecting Bahrain, he must 'go deep' and develop robust intelligence liaison relationships with partners around the world."

"To that end," Ereli writes, "he has embarked on a program to establish and strengthen intelligence ties abroad, with a central focus on counterterrorism. Against this backdrop, Sheikh Khalifa unabashedly positions his relationship with the U.S. Intelligence Community above all others, insisting that his key lieutenants communicate openly with their U.S. liaison partners and actively seek new avenues for cooperation."

Would an imperative to "communicate openly" and jointly pursue "new areas for cooperation" extend to U.S. training of Bahraini spooks in myriad aspects of electronic and signals intelligence, the better to more fully exploit technologies supplied by America's NATO partner, Germany?

Exporting Repression

Three years ago, I reported on a highly-intrusive communications intelligence system which New Scientist drolly dubbed "surveillance in a box." (See: "New Spy Software Coming On-Line: 'Surveillance in a Box' Makes its Debut," Antifascist Calling, August 28, 2008)

According to reporter Laura Margottini, Siemens had developed software capable of integrating "tasks typically done by separate surveillance teams or machines, pooling data from sources such as telephone calls, email and internet activity, bank transactions and insurance records. It then sorts through this mountain of information using software that Siemens dubs "intelligence modules".

"In Bahrain," Bloomberg Markets reported, "officials routinely use surveillance in the arrest and torture of political opponents, according to Nabeel Rajab, president of the Bahrain Center for Human Rights."

Rajab told Silver and Elgin that "he has evidence of this from former detainees, including Al Khanjar, and their lawyers and family members."

"Everyone was interrogated based on telephone calls that were checked--and not only us, the activists," Rajab said. "Even our children, our wives, our sisters are being monitored."

We learned that Siemens had already sold the devilish system to more than 60 Asian, European and Middle Eastern nations, including world-class human rights abusers. Which countries? Well, Siemens won't say.

As Antifascist Calling previously reported, the European privacy watchdog group Quintessenz, published a series of leaked internal documents and presentations made by Siemens for prospective customers.

And while those documents and are startling, in the three years since they were first published, these products have become far more invasive.

Specifically designed for "fusion centers" or their Asian, European and Middle Eastern equivalents, the Intelligence Platform claims it can deliver "real time" intelligence for the hot "lawful interception" market.

As Bloomberg Markets reported, the use of the system by Bahraini police "illustrates how Western-produced surveillance technology sold to one authoritarian government became an investigative tool of choice to gather information about political dissidents--and silence them."

"Some industry insiders," Silver and Elgin wrote, "now say their own products have become dangerous in the hands of regimes where law enforcement crosses the line to repression."

One such insider, Nikhil Gyamlani, told reporters that when he worked as a consultant for Trovicor and Nokia Siemens, the firm "had developed monitoring systems and sold them to some of the countries" on the cutting edge of the Arab Spring.

"Besides Bahrain," Bloomberg Markets reports, "several other Middle Eastern nations that cracked down on uprisings this year--including Egypt, Syria and Yemen--also purchased monitoring centers from the chain of businesses now known as Trovicor."

And "Trovicor equipment," Silver and Elgin averred, "plays a surveillance role in at least 12 Middle Eastern and North African nations, according to the two people familiar with the installations."

During the Bahraini uprising, "authorities jammed or restricted communications to stymie gatherings and knew where to send riot police before a protest could even start, according to eyewitness reports."

"For that to happen," Gyamlani told Bloomberg, "government officials had to have some means of figuring out where to go or whom to target to nip protests in the bud."

"Across the Middle East in recent years," Silver and Elgin averred, "sales teams at Siemens, Nokia Siemens, Munich-based Trovicor and other companies have worked their connections among spy masters, police chiefs and military officers to provide country after country with monitoring gear."

Since Nokia Siemens first unveiled the system, updates "allow more than the interception of phone calls, e-mails, text messages and Voice Over Internet Protocol calls such as those made using Skype."

"The monitoring systems," Silver and Elgin wrote, "can scan communications for key words or recognize voices and then feed the data and recordings to operators at government agencies."

According to Bloomberg Markets, "some products can also secretly activate laptop webcams or microphones on mobile devices. They can change the contents of written communications in mid-transmission, use voice recognition to scan phone networks, and pinpoint people's locations through their mobile phones."

In other words, not only can Trovicor's Intelligence Platform spy on political dissidents, it can also fabricate communications thereby setting-up activists for more serious charges, particularly when authorities (falsely) accuse protest organizers of "fomenting violence" through messages they've artfully invented themselves.

One no longer need insert agents provocateurs into proscribed groups. With the Intelligence Platform one can spread disinformation or incite violence from the safety and security of a monitoring center. Think of the savings to security budgets in these deficit conscious times!

"Offshoring" the Security World

As Bloomberg Markets revealed, when Siemens and Nokia unloaded their spy unit, they turned to the offshore world and found an eager buyer in "the Guernsey-based Perusa Partners Fund 1 LP" who "renamed the business Trovicor, coined from the Latin and Esperanto words for find and heart."

Perusa Partners Fund 1 LP is an odd duck to say the least. Their web site informs us that "the fund we counsel is not listed on the stock exchange and is thus able to act independently from quarterly reports and analyses." Founded in 2007 with headquarters in St. Peter Port, Guernsey, Perusa tells us that "we think globally and act locally."

The Fund does not list the identities of key investors since disclosure is "regulated by the Guernsey Financial Services Commission under the Protection of Investors (Bailiwick of Guernsey) Law, 1987 (as amended)."

However, Christian Hollenberg, a founder of Perusa GmbH, says that Trovicor's owners "only invest in ethical businesses" including Trovicor "which the fund owns in its entirety."

Hollenberg told Silver and Elgin that Trovicor is "a legal business, and it's part of every communications network in the civilized world."

But as author Nicholas Shaxson told New Left Project in a wide-ranging interview, "Crown Dependencies" such as "Jersey, Guernsey, the Isle of Man ... have old histories as tax havens and have played an offshore role for decades, even centuries. They also got in on this game of attracting money by offering secrecy, zero taxes, and escape from laws."

And with "partners and investors ... based in the most important financial centers worldwide," the Fund is inclined to invest "in smaller companies, in companies with faint profitability or with operative problems. We are flexible and always prepared for various situations."

Perusa's investment portfolio is a diverse, if strange mix. With interests ranging from the Swedish-based Dynasafe International, which offers "a comprehensive range of explosion containment and munitions destruction equipment as well as off gas treatment systems to customers all over the world," to the medical implant firm GB Implantat-Technologie GmbH in Essen, Germany, and from Belgian-based Flamingo N.V., described as "a leading international company in the domestic pet sector" (!) to Trovicor, Guernsey-based Perusa certainly covers a wide range of investment opportunities.

Accordingly, "the fund we advise invests in companies that are confronted with dramatic change." Trovicor, the firm which snapped-up Siemens Intelligence Platform fits the bill. "Do you want to spin off a business division from a larger organization and become independent?" Well, according to Perusa, "via the fund we advise, we can provide you with fresh capital and new and additional management respectively."

But why would a multibillion euro firm such as Siemens find it necessary, or even desirable, to "spin-off" a profitable unit, one with unlimited growth potential in the über-lucrative "lawful interception" niche market"?

After all, this sector is worth some $3 billion annually, Jerry Lucas, the president of the McLean, Virginia-based TeleStrategies Inc., the organizers of ISS World trade shows for spooky companies servicing the secret state told Bloomberg Markets.

If we're to believe statements from Nokia Siemens Networks spokesperson Ben Roome, "the elevated risk of human rights abuses was a major reason for NSN's exiting the monitoring-center business."

Quick to absolve the firm of any liability for designing and selling products to autocratic regimes that torture their citizens, Roome told Silver and Elgin that "ultimately people who use this technology to infringe human rights are responsible for their actions."

And with ISS World Americas conference in Washington, D.C., right around the corner, enterprising security officials will learn "methodologies and tools to bridge the chasms of lawful intercept data gathering to information creation to investigator knowledge to actionable intelligence."

One shudders to think what "knowledge" was shared last year amongst Middle Eastern spooks who attended ISS World MEA conclave in Dubai or what tips of the dirty trade Trovicor's head of consulting, Jesper Mathiesen, gave his eager hosts.

Amongst the "tools" which Trovicor supplies, at a steep price rest assured, are spy kit for "intelligence mining;" "pattern recognition;" "behaviour profiling;" "indexing-text search," that performs "in the background" on "contents of emails, web pages, Word documents, SMS, database records etc.;" "mobile location tracking" suites equipped with a "geographical information system," an "ideal solution to track, record, extrapolate, and anticipate the movements of mobile devices;" "speaker recognition" and of course, "link analysis" tools which can be used "to find and graphically display correlating data of intercepted targets."

And should current spy toys prove insufficient, additional "add-on applications are being developed to allow for maximum use of the information contained in the database of the Monitoring Center."

Abdul Ghani Al Khanjar is in hiding today. He told Bloomberg Markets that "he took up the anti-torture cause after being detained and interrogated for six days in 2000. His jailers handcuffed him, hung him from a stick 'like a goat' and beat the soles of his feet."

And when the activist returned from London in August 2010, after testifying about Bahraini human rights abuses before a committee at the House of Lords, plainclothes police took him away.

"For his first 85 days or so in custody," Bloomberg Markets reported, "Al Khanjar saw no one from the outside."

"For one agonizing stretch," Silver and Elgin averred, "his jailers forced him to stand without sleeping for five days. At other times they beat him with hoses and their hands and threatened him with sexual abuse."

"I'm hidden somewhere," he says. "I'm unfortunately in Bahrain. They're going to kill me. What to do? What to do?"

This raises an inevitable question: what will we do to bring down repressive, authoritarian governments, beginning with those in the West, which profit handsomely from screams dying in soundproof rooms?

(Image courtesy of Metronaut)
Posted by Antifascist at 12:34 PM


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