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Fox News Series on Israeli Spying in the US
by Firefox - 11th Dec 2001
from http://www.firefox.1accesshost.com/cameron.html

In mid December, Fox News Channel ran a blockbuster series on Israeli spying
in the US contending that Israeli intelligence had advanced information about
the Sept. 11 attacks before the fact.

After significant pressure, Fox pulled the reports from their Website and
went about deleting all references to the series of their's and other
Websites. Fox has never given any explanation for this action.

The original transcripts which appeared on Fox's Website are reprinted here.

The series was presented the investigative reporter Carl Cameron and
presented on Special Report with Brit Hume.

----------------------------------------------------------------------

Part 1: December 11, 2001

HUME: It has been more than 16 years since a civilian working for the Navy
was charged with passing secrets to Israel.

Jonathan Pollard pled guilty to conspiracy to commit espionage and is serving
a life sentence.

At first, Israeli leaders claimed Pollard was part of a rogue operation, but
later took responsibility for his work.

Now Fox News has learned some U.S. investigators believe that there are
Israelis again very much engaged in spying in and on the U.S.,who may have
known things they didn't tell us before September 11. Fox News correspondent
Carl Cameron has details in the first of a four-part series.(BEGIN VIDEOTAPE)

CARL CAMERON, FOX NEWS CORRESPONDENT (voice-over): Since September 11,more
than 60 Israelis have been arrested or detained, either under the new patriot
anti-terrorism law, or for immigration violations.

A handful of active Israeli military were among those detained, according to
investigators,who say some of the detainees also failed polygraph questions
when asked about alleged surveillance activities against and in the United
States.

There is no indication that the Israelis were involved in the 9-11
attacks,but investigators suspect that they Israelis may have gathered
intelligence about the attacks in advance, and not shared it. A highly placed
investigator said there are -quote  "tie-ins." But when asked for details,
he flatly refused to describe them, saying,  quote  "evidence linking these
Israelis to 9-11 is classified.

I cannot tell you about evidence that has been gathered. It's classified
information." Fox News has learned that one group of Israelis, spotted in
North Carolina recently,is suspected of keeping an apartment in California to
spy on a group of Arabs who the United States is also investigating for links
to terrorism.

Numerous classified documents obtained by Fox News indicate that even prior
to September 11,as many as 140 other Israelis had been detained or arrested
in a secretive and sprawling investigation into suspected espionage by
Israelis in the United States.

Investigators from numerous government agencies are part of a working group
that's been compiling evidence since the mid '90s.

These documents detail hundreds of incidents in cities and towns across the
country that investigators say  quote  "may well be an organized
intelligence gathering activity."

The first part of the investigation focuses on Israelis who say they are art
students from the University of Jerusalem and Bazala (ph) Academy.

They repeatedly made contact with U.S. government personnel, the report says,
by saying they wanted to sell cheap art or handiwork.

Documents say they  quote  "targeted and penetrated military bases." The
DEA, FBI and dozens of government facilities,and even secret offices and
unlisted private homes of law enforcement and intelligence personnel. The
majority of those questioned  quote -"stated they served in military
intelligence, electronic surveillance intercept and or explosive ordinance
units."

Another part of the investigation has resulted in the detention and arrests
of dozens of Israelis at American mall kiosks,where they've been selling toys
called Puzzle Car and Zoom Copter. Investigators suspect a front.

Shortly after "The New York Times" and "Washington Post" reported the Israeli
detentions last months, the carts began vanishing. Zoom Copter's Web page
says,"We are aware of the situation caused by thousands of mall carts being
closed at the last minute. This in no way reflects the quality of the toy or
its salability.

The problem lies in the operators' business policies." Why would Israelis spy
in and on the U.S.?

A general accounting office investigation referred to Israel as country A and
said  quote -"According to a U.S. intelligence agency, the government of
country A conducts the most aggressive espionage operations against the U.S.
of any U.S. ally."

A defense intelligence report said Israel has a voracious appetite for
information and said  quote -"the Israelis are motivated by strong survival
instincts which dictate every possible facet of their political and
economical policies.

It aggressively collects military and industrial technology and the U.S. is a
high priority target."

The document concludes  quote  "Israel possesses the resources and
technical capability to achieve its collection objectives."

(END VIDEO CLIP)

A spokesman for the U.S.  excuse me, the Israeli embassy here in Washington
issued a denial saying that any suggestion that Israelis are spying in or on
the U.S. is  quote  "simply not true." There are other things to consider.
And in the days ahead, we'll take a look at the U.S. phone system and law
enforcement's methods for wiretaps.

And an investigation that both have been compromised by our friends overseas
 Brit.

HUME: Carl, what about this question of advanced knowledge of what was going
to happen on 9-11?

How clear are investigators that some Israeli agents may have known
something?

CAMERON: It's very explosive information, obviously, and there's a great deal
of evidence that they say they have collected  none of it necessarily
conclusive.

It's more when they put it all together. A bigger question, they say, is how
could they not have know? Almost a direct quote  Brit.

HUME: Going into the fact that they were spying on some Arabs, right?

CAMERON: Correct.

HUME: All right, Carl, thanks very much. We have to take a quick bread here
for other headlines.

----------------------------------------------------------------------

Part 2: December 12, 2001

HUME: Last time we reported on the approximately 6- Israelis who had been
detained in connection with the September 11th terrorism investigation.

Carl Cameron reported that U.S. investigators suspect that some of these
Israelis were spying on Arabs in this country,and may have turned up
information on the planned terrorist attacks back in September that was not
passed on.

Tonight, in the second of four reports on spying by Israelis in the U.S., we
learn about an Israeli-based private communications company,for whom a
half-dozen of those 60 detained suspects worked.

American investigators fear information generated by this firm may have
fallen into the wrong hands and had the effect of impeded the September 11th
terror inquiry.

Here's Carl Cameron's second report.

(BEGIN VIDEOTAPE)

CARL CAMERON, FOX NEWS CORRESPONDENT (voice-over): Fox News has learned that
some American terrorist investigators fear certain suspects in the September
11th attacks may have managed to stay ahead of them, by knowing who and when
investigators are calling on the telephone. How?

By obtaining and analyzing data that's generated every time someone in the
U.S. makes a call.

UNIDENTIFIED FEMALE: What city and state, please?

CAMERON: Here's how the system works. Most directory assistance calls,and
virtually all call records and billing in the U.S. are done for the phone
companies by Amdocs, Ltd, an Israeli-based private telecommunications
company.

Amdocs has contracts with the 25 biggest phone companies in America, and more
worldwide. The White House and other secure government phone lines are
protected,but it is virtually impossible to make a call on normal phones
without generating an Amdocs record of it.

In recent years, the FBI and other government agencies have investigated
Amdocs more than once.

The firm has repeatedly and adamantly denied any security breaches or
wrongdoing. But sources tell Fox News that in 1999, the super secret national
security agency,headquartered in northern Maryland, issued what's called a
Top Secret sensitive compartmentalized information report,

TS/SCI, warning that records of calls in the United States were getting into
foreign hands  in Israel, in particular.

Investigators don't believe calls are being listened to, but the data about
who is calling whom and when is plenty valuable in itself.

An internal Amdocs memo to senior company executives suggests just how Amdocs
generated call records could be used.

Quote  "widespread data mining techniques and algorithms.... combining both
the properties of the customer (e.g., credit rating)and properties of the
specific 'behavior..." Specific behavior, such as whom the customers are
calling.

The Amdocs memo says the system should be used to prevent phone fraud. But
U.S. counterintelligence analysts say it could also be used to spy through
the phone system.

Fox News has learned that the N.S.A has held numerous classified conferences
to warn the F.B.I. and C.I.A. how Amdocs records could be used.

At one NSA briefing, a diagram by the Argon national lab was used to show
that if the phone records are not secure, major security breaches are
possible.

Another briefing document said  quote  "It has become increasingly apparent
that systems and networks are vulnerable.

Such crimes always involve unauthorized persons, or persons who exceed their
authorization... citing on exploitable vulnerabilities."

Those vulnerabilities are growing, because according to another briefing, the
U.S. relies too much on foreign companies like Amdocs for high tech equipment
and software.

Quote  "Many factors have led to increased dependence on code developed
overseas.... We buy rather than train or develop solutions."

U.S. intelligence does not believe the Israeli government is involved in a
misuse of information, and Amdocs insists that its data is secure.

What U.S. government officials are worried about, however, is the possibility
that Amdocs data could get into the wrong hands, particularly organized
crime.

And that would not be the first thing that such a thing has happened. Fox
News has documents of a 1997 drug trafficking case in Los Angeles, in which
telephone information,the type that Amdocs collects, was used to  quote 
"completely compromise the communications of the FBI, the Secret Service, the
DEO and the LAPD."

We'll have that and a lot more in the days ahead  Brit.

HUME: Carl, I want to take you back to your report last night on those 60
Israelis who were detained in the anti-terror investigation,and the suspicion
that some investigators have that they may have picked up information on the
9-11 attacks ahead of time and not passed it on.

There was a report, you'll recall, that the Mossad, the Israeli intelligence
agency, did indeed send representatives to the U.S. to warn, just before
9-11,that a major terrorist attack was imminent. How does that leave room for
the lack of a warning?

CAMERON: I remember the report, Brit.

We did it first internationally right here on your show on the 14th. What
investigators are saying is that that warning from the Mossad was nonspecific
and general,and they believe that it may have had something to do with the
desire to protect what are called sources and methods in the intelligence
community.

The suspicion being, perhaps those sources and methods were taking place
right here in the United States.

The question came up in select intelligence committee on Capitol Hill today.
They intend to look into what we reported last night, and specifically that
possibility  Brit.

HUME: So in other words, the problem wasn't lack of a warning, the problem
was lack of useful details?

CAMERON: Quantity of information.

HUME: All right, Carl, thank you very much. Coming up next, more perspective
on that B-1 bomber crash and on the showdown in eastern Afghanistan.

----------------------------------------------------------------------

Part 3: December 13, 2001

HUME: Last time we reported on an Israeli-based company called Amdocs that
generates the computerized recordsand billing data for nearly every phone
call made in America. As Carl Cameron reported,

U.S. investigators digging into the 9-11 terrorist attacks fear that suspects
may have been tipped off to what they were doing by information leaking out
of Amdocs.

In tonight's report, we learn that the concern about phone security extends
to another company, founded in Israel,that provides the technology that the
U.S. government uses for electronic eavesdropping. Here is Carl Cameron's
third report.

(BEGIN VIDEOTAPE)

CARL CAMERON, FOX NEWS CORRESPONDENT (voice-over): The company is Comverse
Infosys, a subsidiary of an Israeli-run private telecommunications firm,with
offices throughout the U.S. It provides wiretapping equipment for law
enforcement. Here's how wiretapping works in the U.S.

Every time you make a call, it passes through the nation's elaborate network
of switchers and routers run by the phone companies. Custom computers and
software,made by companies like Comverse, are tied into that network to
intercept, record and store the wiretapped calls, and at the same time
transmit them to investigators.

The manufacturers have continuing access to the computers so they can service
them and keep them free of glitches.

This process was authorized by the 1994 Communications Assistance for Law
Enforcement Act, or CALEA.

Senior government officials have now told Fox News that while CALEA made
wiretapping easier, it has led to a system that is seriously vulnerable to
compromise,and may have undermined the whole wiretapping system. Indeed, Fox
News has learned that Attorney General John Ashcroftand FBI Director Robert
Mueller were both warned October 18th in a hand-delivered letter from 15
local, state and federal law enforcement officials, who complained that
-quote  "law enforcement's current electronic surveillance capabilities are
less effective today than they were at the time CALEA was enacted."

Congress insists the equipment it installs is secure. But the complaint about
this system is that the wiretap computer programs made by Comverse have, in
effect,a back door through which wiretaps themselves can be intercepted by
unauthorized parties. Adding to the suspicions is the fact that in Israel,

Comverse works closely with the Israeli government, and under special
programs,gets reimbursed for up to 50 percent of its research and development
costs by the Israeli Ministry of Industry and Trade.

But investigators within the DEA, INS and FBI have all told Fox News that to
pursue or even suggest Israeli spying through Comverse is considered career
suicide.

And sources say that while various F.B.I. inquiries into Comverse have been
conducted over the years,they've been halted before the actual equipment has
ever been thoroughly tested for leaks.

A 1999 F.C.C. document indicates several government agencies expressed deep
concernsthat too many unauthorized non-law enforcement personnel can access
the wiretap system.

And the FBI's own nondescript office in Chantilly, Virginia that actually
oversees the CALEA wiretapping program, is among the most agitated about the
threat.

But there is a bitter turf war internally at F.B.I. It is the FBI's office in
Quantico, Virginia, that has jurisdiction over awarding contracts and buying
intercept equipment.

And for years, they've thrown much of the business to Comverse.

A handful of former U.S. law enforcement officials involved in awarding
Comverse government contracts over the years now work for the company.

Numerous sources say some of those individuals were asked to leave government
service under what knowledgeable sources call "troublesome circumstances"that
remain under administrative review within the Justice Department.

(END VIDEOTAPE)

And what troubles investigators most, particularly in New York, in the
counterterrorism investigation of the World Trade Center attack, is that on a
number of cases,suspects that they had sought to wiretap and surveil
immediately changed their telecommunications processes.

They started acting much differently as soon as those supposedly secret
wiretaps went into place  Brit.

HUME: Carl, is there any reason to suspect in this instance that the Israeli
government is involved?

CAMERON: No, there's not.

But there are growing instincts in an awful lot of law enforcement officials
in a variety of agencies who suspect that it had begun compiling evidence,and
a highly classified investigation into that possibility  Brit.

HUME: All right, Carl. Thanks very much.

----------------------------------------------------------------------

Part 4: December 14, 2001

TONY SNOW: This week, senior correspondent Carl Cameron has reported on a
longstanding government espionage investigation.

Federal officials this year have arrested or detained nearly 200 Israeli
citizens suspected of belonging to a  quote  "organized
intelligence-gathering operation."

The Bush administration has deported most of those arrested after September
11th, although some are in custody under the new anti-terrorism law.

Cameron also an investigation into the possibility that an Israeli firm
generated billing data that could be used for intelligence purposeS,and
describes concerns that the federal government's own wiretapping system may
be vulnerable. Tonight, in part four of the series,we'll learn about the
improbably roots of the probe: a drug case that went bad four years ago in
L.A.

(BEGIN VIDEOTAPE)

CARL CAMERON, FOX NEWS CORRESPONDENT (voice-over): Los Angeles, 1997, a major
local, state and federal drug investigating sours.

The suspects: Israeli organized crime with operations in New York, Miami, Las
Vegas, Canada, Israel and Egypt.

The allegations: cocaine and ecstasy trafficking, and sophisticated white
collar credit card and computer fraud.

The problem: according to classified law enforcement documents obtained by
Fox News, the bad guys had the cops' beepers, cell phones,even home phones
under surveillance. Some who did get caught admitted to having hundreds of
numbers and using them to avoid arrest.

Quote: "This compromised law enforcement communications between LAPD
detectives and other assigned law enforcement officers working various
aspects of the case.

The organization discovered communications between organized crime
intelligence division detectives, the FBI and the Secret Service."

Shock spread from the DEA to the FBI in Washington, and then the CIA. An
investigation of the problem, according to law enforcement documents,
concluded  quote -"The organization has apparent extensive access to
database systems to identify pertinent personal and biographical
information."

When investigators tried to find out where the information might have come
from, they looked at Amdocs, a publicly-traded firm based in Israel.

Amdocs generates billing data for virtually every call in America, and they
do credit checks.

The company denies any leaks, but investigators still fear that the firm's
data is getting into the wrong hands.

When investigators checked their own wiretapping system for leaks, they grew
concerned about potential vulnerabilities in the computers that
intercept,record and store the wiretapped calls. A main contractor is
Comverse Infosys, which works closely with the Israeli government, and under
a special grant program,is reimbursed for up to 50 percent of its research
and development costs by Israel's Ministry of Industry and Trade.

Asked this week about another sprawling investigation and the detention of 60
Israeli since September 11, the Bush administration treated the questions
like hot potatoes.

ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: I would just refer you to the
Department of Justice with that. I'm not familiar with the report.

COLIN POWELL, SECRETARY OF STATE: I'm aware that some Israeli citizens have
been detained.

With respect to why they're being detained and the other aspects of your
question  whether it's because they're in intelligence services, or what
they were doing -

I will defer to the Department of Justice and the FBI to answer that.

(END VIDEOTAPE)

CAMERON: Beyond the 60 apprehended or detained, and many deported since
September 11,another group of 140 Israeli individuals have been arrested and
detained in this year in what government documents describe as  quote -"an
organized intelligence gathering operation," designed to  quote  "penetrate
government facilities."

Most of those individuals said they had served in the Israeli military, which
is compulsory there. But they also had, most of them, intelligence
expertise,and either worked for Amdocs or other companies in Israel that
specialize in wiretapping.

Earlier this week, the Israeli embassy in Washington denied any spying
against or in the United States  Tony.

SNOW: Carl, we've heard the comments from Ari Fleischer and Colin Powell.
What are officials saying behind the scenes?

CAMERON: Well, there's real pandemonium described at both the FBI, the DEA
and the INS.

A lot of these problems have been well-known to some investigators, many of
whom have contributed to the reporting on this story.

And what they say is happening is supervisors and management are now going
back and collecting much of the information,because there's tremendous
pressure from the top levels of all of those agencies to find out exactly
what's going on.

At the DEA and the FBI already a variety of administration reviews are under
way, in addition to the investigation of the phenomenon.

They want to find out how it is all this has come out, as well as be very
careful because of the explosive nature and very political ramifications of
the story itself  Tony.

SNOW: All right, Carl, thanks. The Hart Senate office building, which was
contaminated by anthrax, is scheduled to undergo some cleaning after more
traces were found there.