Uncovering The CIA's Audacious Operation That Gave Them Access To State Secrets Greg Miller of The Washington Post reveals the hidden history of Crypto AG, a Swiss firm that sold encryption technology to 120 countries — but was secretly owned by the CIA for decades.
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Uncovering The CIA's Audacious Operation That Gave Them Access To State Secrets

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Uncovering The CIA's Audacious Operation That Gave Them Access To State Secrets

Uncovering The CIA's Audacious Operation That Gave Them Access To State Secrets

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DAVE DAVIES, HOST:

This is FRESH AIR. I'm Dave Davies, in for Terry Gross, who's off this week. There have been some startling revelations about U.S. intelligence activities by journalists in recent years, but the story last month by our guest, Greg Miller of The Washington Post, stands out as especially remarkable. He reported that a Swiss company which sold encryption equipment and technology to governments around the world for decades was secretly owned by the CIA and the West German intelligence service, and they were rigging the technology they sold to allow the U.S. and West Germany to spy on the countries that bought it. Miller obtained a secret CIA study of the project. His story was jointly reported with the German public broadcaster ZDF, which obtained a similar account of the operation by the German intelligence service the BND.

Greg Miller is a national security reporter for The Washington Post. He was among two reporting teams at the post that won Pulitzer Prizes in 2014 and 2018. He's the author of the book "The Apprentice: Trump, Russia And The Subversion Of American Democracy," which has just come out in paperback.

Greg Miller, welcome back to FRESH AIR. So let's go over some of the basics here. This was a Swiss firm, Crypto or Crypto AG. What exactly was its business?

GREG MILLER: So Crypto AG was a maker of encryption devices; that is, it made equipment that was mainly for governments, for nations to use to protect their communications. So basically, these are machines that scramble messages and code them and then decode them at the other end so that other governments can't listen to what you're saying to your diplomats or to your military or to your spies. It's designed to protect the secrecy of countries' communications.

DAVIES: And do we know how many countries bought the stuff?

MILLER: Yeah. So Crypto AG was, for most of its history, the world's leading supplier of this kind of technology, and it sold its devices to more than 120 countries around the world.

DAVIES: And all that time, the buyers didn't know the true owners, right?

MILLER: (Laughter) Right. So the - Crypto AG, from its inception, was cooperating with U.S. intelligence agencies and, for most of its history, was actually owned by the CIA. From 1970 until 1998, it was essentially a subsidiary of the CIA, even while dozens and dozens of countries around the world were buying these machines, this equipment, encryption equipment, trusting this company with their most precious secrets.

DAVIES: Right. And it was the CIA and the German intelligence agency, the BND, too, right?

MILLER: That's right. So initially, the CIA purchases and acquires Crypto AG in a partnership with German intelligence. That relationship goes on for several decades. And then the Germans left, but then the CIA kept going for decades after that.

DAVIES: OK, so governments buy this so that they can send encrypted messages to their agents elsewhere, whoever they might be, or their diplomats. What kind of material did the CIA and their German counterparts get from these devices?

MILLER: So it essentially lays bare all of the most sensitive communications of dozens of governments around the world, including a lot of adversaries of the United States. So countries that bought this equipment included Iran, included almost all of Latin America, most countries in the Middle East, most countries in Africa, some countries in Europe. I mean, it's staggering, the scale of this operation. And what the U.S. got as a result is just intelligence on the activities of these countries, on terrorist operations, on bombings - like the bombing of a disco in Berlin in the 1980s - of military operations. The United States helped England in its war over the Falklands Islands with Argentina thanks to these devices. I mean, there are just example after example where this operation gave the United States amazing insight into what other countries' plans and intentions were.

DAVIES: It's interesting that so many countries bought it and didn't know for years what its true use was. But not the Soviet Union and China. Why?

MILLER: Right. I mean, that's a really important point to make here because as successful as this operation was, it had certain limits. The United States main adversaries, of course, throughout the Cold War were the Soviet Union and China, and they never bought these devices because it was a Western-based company. It's in Switzerland. It has, you know, ties to other European governments. And there's no way the Soviet state was going to trust its secrets to something coming out of the West. And also, I mean, the Soviets were capable of building their own equipment. They had their own sophisticated encryption machines. And so as a result, they were never exposed. They were never penetrated as part of this program.

DAVIES: Let's talk about the origins of this. It wasn't like these spy agencies just decided - hey, let's open a shop and sell this stuff. It starts with an interesting character, Boris Hagelin, right? Tell us about him.

MILLER: Yeah, it's a fascinating backstory for this company, and it traces back to World War II and even beforehand. Boris Hagelin is a Swedish entrepreneur and inventor who has ideas for mechanical encryption devices. I mean, these are very crude-kind-of-looking little boxes with gears inside them. You can still see these things in museums. And he is Russian-born. His family flees to Sweden. And he develops this technology at a really opportune moment because it's just happening as World War II is on the horizon.

The United States is about to enter the war. The United States Army desperately needs encryption devices so that units can communicate with one another in the field. And they end up buying 140,000 of these things from Hagelin. He ends up coming over to the United States. They repurpose a typewriter factory in Connecticut to build these encryption devices. And they're little portable boxes that soldiers would carry around and strap them to their knees, and they would encode messages and then send them by telegraph or radio to other units.

And that was what gave birth not only to this company but to the relationship between Boris Hagelin, the founder of Crypto, and the United States. And it's that relationship that sort of serves as the basis for this incredible espionage operation that comes about years later.

DAVIES: This is fascinating, you know, for people who've grown up accustomed to everything being done by software on small or handheld devices. This was mechanical. You would generate encrypted messages with all these gears and levers.

MILLER: Yeah. It looks like a little mini cash register. It has a lever on the right-hand side that you actually had to hand crank. You have to twist the dials inside yourselves. And it was very tedious. To encode a simple message, you had to do it letter by letter. You'd turn a dial on the front of the machine to letters A, B, C or D, and it spits out a different letter on a piece of tape that comes out the back. And then you've got to carry that tape over to your communications officer, and he's got to transmit this in Morse code.

DAVIES: Right. So the United States has this relationship with Hagelin and buys these encryption devices during the war. Afterwards, they'd like to continue the relationship. And you tell us that it was fortuitous that the head of the United States Army's signals intelligence service - a guy William Friedman - was a good friend of Hagelin. What kind of deal did they manage to strike?

MILLER: So this is one of the crucial relationships not only in this operation but in all of Cold War espionage. William Friedman is a cryptologist in the United States. He's regarded by many as kind of the pioneer of cryptology in the United States. He has a lot in common with Boris Hagelin. They're both born in Russia. They're both fascinated with this kind of mathematics and technology. And they forge a relationship. They meet each other in the 1940s. And it's Friedman who then becomes sort of the manager of this relationship with Hagelin over time. So after the war, Hagelin goes back to Sweden. He's flush with cash from his huge contract from the U.S. Army. He's got - you know, he was paid $8 million for all these devices he made. And he's planning to go into business and start selling this stuff around the world, and that scares the United States. It scares Friedman. Uh-oh - we're not going to be able to spy on other countries if Hagelin succeeds in his business plans. We need to get back in with him and establish a relationship where we have some control over what he's selling and who he's selling to.

DAVIES: So what's the arrangement they come to?

MILLER: The arrangement evolves. So initially, it's basically - Hagelin agrees almost voluntarily to withhold his best equipment from certain countries that are seen as adversaries by the West. And I think it's really important to think about this time as just sort of after Cold - after World War II through the early years of the Cold War, when the United States is seen as a savior by much of Western Europe. And so there is a huge interest in cooperating with the United States, great respect for the country. And so Hagelin and Crypto cooperate initially, but that changes by the mid-1960s when it becomes a much deeper relationship. And Hagelin is actually getting paid hundreds of thousands of dollars by the CIA to withhold his best, most secure encryption devices from countries that are not on a list that are presented to him each year by the United States, by the CIA.

DAVIES: So how does this morph into a CIA-owned company?

MILLER: So there were always, you know, ideas all along the way. Wow, this is a great arrangement we have with Hagelin. Could we tweak it further? Could we go one step further and get him to actually rig his devices in ways that we design? And Friedman was reluctant to do that. He thought that would be a step too far for Hagelin. But in the '60s, technology changed, and it kind of forced Hagelin's hand. It moves - technology moves from the gears and the mechanical devices that he knew how to build into electronics that he knew a lot less about.

And so the NSA, the National Security Agency, which is a huge U.S. intelligence agency, sees an opportunity here. We can help Hagelin solve his problem if he helps us solve our problem. We'll give him the technology, the know-how to get into electronics and algorithms if he will let us design these machines and rig them so that we can read them going forward. And that is the initial basis for this operation.

DAVIES: We're speaking with Greg Miller. He covers national security for The Washington Post. We'll talk more after this short break. This is FRESH AIR.

(SOUNDBITE OF ALEXANDRE DESPLAT'S "SPY MEETING")

DAVIES: This is FRESH AIR. And my guest is Washington Post national security reporter Greg Miller. He recently wrote a story about a Swiss-based firm that sold encryption technology to countries all around the world for decades. What those countries didn't know is that the company was co-owned by the CIA and German intelligence services, which were using the technology they sold to spy on the countries that bought it.

So they decided to register a company in Switzerland, is that what happens?

MILLER: So Hagelin moved his company to Switzerland in the 1950s, mainly to get away from Swedish tax laws.

(LAUGHTER)

MILLER: But there were other reasons, too. I mean, there was a workforce in Switzerland, that they were world-renowned for making sophisticated watch mechanisms and things like this, and that helped him with his early machines. But yes, so - but by the late 1960s, Hagelin is getting on in years. He's in his 80s. He's looking to retire. He wants to get out of this. And he's trying to figure out what's going to happen to this company. And that is when the - he's interested in selling it. And that's when U.S. spy agencies sort of faced this dilemma. Other spy agencies are circling Hagelin, and it's only because the French and the Germans come to him at some point and say, we would like to buy Crypto from you and would enable you to retire, that the CIA and NSA finally get their act together and say, get out of here, France. We're going to buy this thing with the Germans, and everybody else can take a back seat.

DAVIES: Right. So the Germans and the United States intelligence services, they buy the company or register a new company?

MILLER: No, they buy the company. They have to create a new holding entity. They do this in Liechtenstein, which is this tiny country in Europe that is notorious for its secretive banking and corporate ownership laws. So they create this phony entity to buy Crypto from Hagelin, but they pay him cash for it. They pay him millions of dollars for the company. And he basically turns it over to them through this secret ownership arrangement.

DAVIES: Right. So we end up with ostensibly private company that is secretly owned by two intelligence services. Did it have the normal kind of leadership structure of a company with a board of directors, and did they know what was going on?

MILLER: Yeah, that's a great question. So - right. To the rest of the outside world, this looks like, you know, some new owners have come in and bought this thing, but it's still Crypto AG. It's still a Swiss company. It's - you know, it's completely private. But behind the scenes, it's actually owned by the CIA and BND, which is the German intelligence service. And they try to create the appearance that this is still functioning as a private entity. So yes, there's a board of directors. There's a chief executive. There's a research and development department. There are dozens, if not hundreds, of employees at this company. But in secret, there are always a small number, usually just one or two - the chief executive at the company and one or two members of the board - who know the truth, and they are responsible for executing the orders of the CIA and the BND.

DAVIES: Wow. It's also remarkable, you learned in this material that you got access to, that that the German and American agencies brought in some corporate partners to help with the technology - Siemens in the case of the Germans, Motorola in the case of the Americans. Did these private companies know they were assisting in spying?

MILLER: Absolutely (laughter). I mean, there are detailed accounts in these documents of conversations with these massive companies. Hey, we are running this secret operation out of Switzerland. We're having trouble with this certain device. It's not working very well. We're trying to make our transition into a new technology. Can you help us out with this? They're may not be read into all the details of the operation, but they are - it's clear to those companies that they are working hand-in-glove with the CIA, NSA and the BND.

DAVIES: Let's talk about some of the more interesting moments in the operation of this company which was around for decades. For example, the Camp David talks, trying to establish peace between the Israelis and Palestinians.

MILLER: Sure. So there - the documents lay out numerous sort of global events where this operation gave U.S. officials, including presidents, deep insight into what was happening, an upper hand almost, including the Camp David negotiations under President Carter in the late 1970s between Egypt and Israel. All of the Egyptian communications from Camp David back to Cairo were being monitored because the Egyptians were a huge customer of Crypto AG, and the NSA was able to pick off all of those communications between President Sadat and his advisers back in Cairo and decode them, read them. They knew everything that the Egyptians were doing. There were numerous other cases here. I've...

DAVIES: Can I just stop you there for a sec? So the Americans were hearing what the inside Egyptian communications were about their strategy in the talks. Was that communicated to President Carter and his advisers so they knew more about what one side was doing?

MILLER: Absolutely. Absolutely. So I mean, that's one of the goals. That's one of the primary objectives of spying or espionage. So yes. So the NSA is monitoring these communications. They're intercepting all of Sadat's communications to his advisers back in Cairo. They're telling Carter and his whole negotiation team. So they come in to all their meetings with the Israelis and the Egyptians with a huge leg up. They already know what the Egyptian positions are, what their vulnerabilities are, what they're willing to concede and what their redlines are.

DAVIES: Were the Israelis customers of Crypto? Did the Americans know what their bottom lines were?

MILLER: The Israelis were in an interesting status here because the Israelis were not customers of Crypto in the main. They may have used Crypto devices here and there. But they were beneficiaries of this operation. So there's a handful of countries around the world that benefited from this, that the United States shared its secrets with in certain cases, and Israel was one of those. It's not clear from the documents how much this happened in the Camp David negotiations. But it's very clear from these files that Israel was given access to the intelligence that the United States got because of the Crypto penetration.

DAVIES: And then there was the 1979 Iranian hostage crisis.

MILLER: Right. So Iran was a huge customer of Crypto AG for years and years, bought a lot of these machines and used them. And it left them utterly vulnerable to penetration by U.S. spy agencies as a result. So when radicals stormed the American Embassy in Tehran and took 52 hostages, there were negotiations between the Carter administration and the regime for more than a year. And the United States was able to monitor all of the deliberations and all the conversations of the Iranians because of those - because of their government's use of these Crypto machines.

I mean, that speaks to a limit here to espionage, right? Knowing what the Iranians are doing and how they're reacting to the latest proposals and negotiations did not help President Carter get those hostages freed before his term in office ended. But it did give his administration deep insight into the Iranian position and what was happening.

DAVIES: And then there's the matter of the brother of President Jimmy Carter. People who are old enough will remember he had brother, Billy, who had his own private business enterprises which, at times, embarrassed the president. And one of them ended up having contact with Crypto. You want to explain what happened here?

MILLER: Yeah. So I mean, there are kind of echoes of this, I think, in our current situation in Washington, it seems like sometimes. But yeah, so President Carter had this kind of rogue brother, Billy, who basically started taking money from the Libyan government to pursue its interests as kind of in a - lobbying in Washington secretly. It did not own up to this initially. And so...

DAVIES: And this is when Muammar Gaddafi was running the place, right?

MILLER: Correct. And so, I mean, one of the most embarrassing moments and one of the most sort of trickiest moments that comes up in the Crypto history is that the NSA learns from monitoring Libya's communications that they regard Billy Carter as a paid informant. And so the NSA director at the time, Bobby Ray Inman, has to call the attorney general and say, I'm sorry to throw this in your lap, but we have some intelligence here that the president's brother is secretly taking cash from Muammar Gaddafi

DAVIES: Wow.

MILLER: Yeah.

DAVIES: And what did that lead to?

MILLER: Well, ultimately, it leads to an investigation. I think that Billy Carter ultimately had to declare himself a foreign lobbyist and admit that he had misled the FBI. But he was not, ultimately, prosecuted for this.

DAVIES: Greg Miller covers national security for The Washington Post. After a break, he'll tell us what happened when one of the international salesmen for the company Crypto AG was arrested in Iran and accused of espionage. Also, film critic Justin Chang reviews the new Western "First Cow" from independent filmmaker Kelly Reichardt. I'm Dave Davies, and this is FRESH AIR.

(SOUNDBITE OF ALEXIS CUADRADO'S "POR LA MINIMA (BULERIAS)")

DAVIES: This is FRESH AIR. I'm Dave Davies in for Terry Gross, who's off this week. We're speaking with Greg Miller, who covers national security for The Washington Post. His story last month revealed that a Swiss company which sold encryption technology to governments around the world for decades was secretly owned by the CIA and the West German intelligence service, who were rigging the technology to allow the U.S. and West Germany to spy on the countries that bought it.

So this company, Crypto, owned by these American and German intelligence services, were out there in a competitive private world where there are other companies that want to sell cryptology services. What did they do to secure and keep market share, to make sure that the countries they were targeting bought from them and not competitors?

MILLER: So it turns out that having U.S. intelligence agencies in your back pocket gives you a pretty substantial leg up on the competition in some ways. So I mean, the documents indicate that the CIA was - would give Crypto extensive amounts of cash to market its devices, to sell its machines in countries that otherwise would not be profitable, places where Crypto probably otherwise would not have bothered even trying to get an account. But the CIA wanted those countries, including many in Africa, to become kind of Crypto customers, and so it would finance the sales of those machines to those governments.

And then there are other ways. I mean, we - you know, so the United States brings in Motorola to help Crypto make more advanced machines at times. The NSA is designing the algorithms that go into the latest devices that Crypto was selling in the '70s, '80s, and 1990s and into the 2000s. So I mean, Crypto is leaning heavily at times on the technical know-how of U.S. spy agencies to make its products look better than the competitors', even though what they are really doing is making those products more vulnerable to U.S. monitoring.

DAVIES: Right. So if they're targeting a country they want to make sure they get into, they can offer a steep discount. Do they do other things like bribe local officials or, you know, run smear campaigns against the competition?

MILLER: Absolutely. So one other - there was another Swiss company at the time - Gretag is what it was called - that was trying to become a rival to Crypto. And the CIA and U.S. intelligence helped to sort of orchestrate smear campaigns around the world to spread disinformation that Gretag's devices couldn't be trusted; there were vulnerabilities in them. And then there were out - absolutely, there were - there was bribery, bald bribery. The Crypto executives would - there - and the documents describe Crypto executives heading off for sales meeting with Saudi officials carrying boxes of Rolex watches to pass around and bringing Saudi officials to Switzerland at one point for supposed training classes on how to use the equipment that were actually just trips for these Saudis to be able to visit brothels in and around Zurich at the company's expense.

DAVIES: Wow. You know, when you have this kind of access to the secrets of countries all over the world, you hear things which are going to raise ethical dilemmas - right? - because they found that a lot of these countries were engaged in, you know, the internal suppression of dissidents, you know, maybe even ethnic cleansing - you know, activities which violated human rights and raised questions about how to respond to this information. Give us a sense of the dilemmas that posed.

MILLER: That's right. I mean, when you look at the history of this operation and you read the CIA's internal history, it's depicted as a triumph of espionage - with good reason. What the documents don't do so well is examine or scrutinize the inevitable dilemmas that come out of an operation like this and that, in fact, come from all aspects of espionage. I mean, this ultimately comes down to an operation in which you were deceiving and exploiting dozens of other sovereign countries. You are exploiting and deceiving hundreds of employees at Crypto who were never told what they were really doing or who the real owners were, even as they're making devices, even as they're make - traveling around the world selling what they believed to be secure machines. They don't know the real truth behind it. There are lots of ethical implications of it. And the one that you just raised, to me, is one of the most substantial. I mean, this puts you in position, as American spy agencies, to have real deep insight into some of the most atrocious things that are happening throughout the Cold War and afterward in places like Latin America or the Middle East. And what do you do with that?

I mean, this is sort of an eternal dilemma for espionage. When you learn something, when you learn about something terrible that's happening - in South America, for instance, many of the governments that were using Crypto machines were engaged in assassination campaigns. Thousands of people were being disappeared, killed. And I mean, they're using Crypto machines, which suggests that the United States intelligence had a lot of insight into what was happening. And it's hard to look back at that history now and see a lot of evidence of the United States going to any real effort to stop it or at least or even expose it.

DAVIES: Right. And if it emerges that the countries that are doing this awful stuff...

MILLER: Yeah.

DAVIES: ...Are using your encrypted, you know, machines to communicate with each other and execute these missions, you're an accessory to it.

MILLER: You're right, right? And so at one point, countries in South America banded together, the most - the military dictatorships of South America banded together to create this kind of joint operation where they were trying to track down dissidents that they couldn't catch within their own borders, and they needed the cooperation of their neighbors. They used Crypto machines to coordinate these activities. They were using Crypto machines to track down and kill dissidents.

DAVIES: The company had a lot of employees, who - many of them were involved in technical roles. And I can't begin to understand this stuff. But they're offering products to countries. Did they become aware at some point that they're selling products which seemed a little funny or seemed to have, you know, aspects to them which would permit, you know, an outsider to access secrets?

MILLER: Absolutely. So to me, this is one of the most fascinating aspects of the history, is that it provides really interesting insights into the lengths that these intelligence agencies had to go to to keep employees at Crypto AG in the dark. And that wasn't always successful. There's a fascinating account of a moment in the late 1970s when a highly capable mathematician, a woman named Mengia Caflisch, is - applies for a job at Crypto. She has a background in radio astronomy and super-technical things. She's incredibly smart, way overqualified for the job she's applying for. And the Crypto executives are like, oh, my God. We're going to hire this woman. She's perfect. And the CIA and NSA back in Washington are responding, what are you guys doing? You cannot bring this woman into this company. She's too smart. She's going to figure this out. The documents literally say that.

And sure enough, she gets there, and she starts poking around and pulling these devices apart and immediately sees inexplicable flaws in the algorithms, inexplicable problems in the security of these machines and starts asking questions. And the responses are always very unsatisfying to her. She's never told the truth, but she's always proposing - she and others propose fixes, right? But they're never allowed to execute those fixes. We can make this box better. We can make this product better. And the executives are always saying, yeah, we think you probably can, but we're not going to do that at this time. We're going to leave it as it is.

DAVIES: Wow.

MILLER: And, yes, they become very suspicious over time. And in fact, Mengia Caflisch, who I met with in Switzerland, told me that this was one of the reasons she ultimately left the company. She felt so uncomfortable about her role in what, to her, increasingly appeared to be a dishonest endeavor.

DAVIES: We're speaking with Greg Miller. He covers national security for The Washington Post. We will continue our conversation in just a moment. This is FRESH AIR.

(SOUNDBITE OF CARL VERHEYEN SONG, "GOOD MORNING JUDGE")

DAVIES: This is FRESH AIR, and my guest is Washington Post national security reporter Greg Miller. He recently wrote a story about a Swiss-based firm that sold encryption technology to countries all around the world for decades, and those countries didn't realize that the company was co-owned by the CIA and German intelligence services, which were, in fact, using the technology they sold to spy on the countries that bought it.

There is an incident that occurs in 1992, when this company, Crypto, has been operating for a while. One of their salesmen, Hans Buhler, is arrested in Iran. Tell us about this.

MILLER: Hans Buhler was one of the company's best salesmen. He has this big account. Iran is a huge customer. Iran, at times, is suspicious of these devices. It's obviously, by that point, engaged in a long-standing kind of adversarial relationship with the United States and the West. And so they arrest Buhler and detain him for nine months and interrogate him. He's put in solitary confinement. They're asking him questions about what's - we think there's something wrong with these devices you're selling us. You need to tell us the truth. And Buhler doesn't know. He has never - he is not witting to the reality of this operation. He's a salesman who's being sent off to these places to sell what he thinks are secure, real encryption machines and doesn't know that this is all a front for the CIA and German intelligence, so he can't answer their questions.

And this is a - you know, circles back to this really critical ethical dilemma at the core of this, right? So you're sending people into harm's way without putting - giving them enough information to make choices for themselves about whether they are willing to do that. And, you know, this is a terrifying account. He comes - he's ultimately released after the Germans pay a million-dollar ransom for him through the company. He comes back. He's badly shaken by what's happened to him. He's suspicious that the Iranians know more about the company he works for than he does. And he becomes a real problem for Crypto. He starts talking to Swiss television stations and others, telling them about his ordeal in Iran, what the Iranians were asking him and his own growing suspicions about what Crypto is doing. And so there - this leads to a huge vulnerability for Crypto and a multi-year effort to kind of contain it by the CIA.

DAVIES: And it troubled the Germans more than the Americans, apparently.

MILLER: Yeah. I mean, so things are really turning politically for the Germans during this period. The Cold War is over, so one of the reasons for engaging in this operation seems to have disappeared. The Berlin Wall has come down. There's a reunification of Germany. Germany is trying to deepen its ties with other countries in Europe, some of whom are customers of Crypto AG. And Germany is increasingly worried that if the word about this gets out, there's going to be hell to pay for us. We are going to bear the brunt of any fallout - political or economic fallout for this operation. Ultimately, they decide around 1993, we want out. We've had enough. We're willing to hand it over to you guys. And so the CIA essentially buys out the German intelligence and keeps going for another 20 years.

DAVIES: Did German intelligence officials ever regret losing this remarkable tool?

MILLER: I think they regret it even to this day. I think the Germans and BND officials see this as one of the most brilliant operations they were ever a part of. It gave them a reason to be close partners with the CIA and NSA, which were the world's most powerful spy agencies. So when that went away, a lot of things ended for the German intelligence officials that they didn't want ending, to end, to see end. They - this was a decision forced on them by the - by political forces in Germany, and I think that the German spies rue that even now.

DAVIES: So how did things develop after the departure of the Germans in the mid-'90s? The Americans stayed with it until very recent years. Did it remain an active intelligence-gathering operation?

MILLER: Totally, yeah. So it just keeps going. The CIA keeps pouring money into this thing, keeps selling devices. They keep introducing - coming out with new products. And they - you know, it's interesting to me because it tells you a lot about the mindset of U.S. intelligence. Even as things - technology changes and this company seems to be struggling and is losing money, there is no part of the U.S. intelligence apparatus that wants to pull back. They're like, keep going. We should milk this thing for all of its worth until we can't find any other reason to keep it going any farther. And so they they carry it forward until 2018. Ultimately, it's a combination of forces, including just new developments in technology that Crypto can no longer really keep up with that force the United States' hand to finally get out of this.

DAVIES: You know, this operation gave them access to intelligence from all over the world, you know, not from sources on the ground but from these devices - I mean, you know, electronic communications that they could intercept. Do you think that there's any connection between that and the kind of global surveillance that has been exposed in recent years by Edward Snowden and others?

MILLER: I think there's two real connections here, and I'm glad you asked this question because I think this is the - these are the areas of most profound relevance to us now. To me, the history of the Crypto operation helps to explain how U.S. spy agencies became accustomed to, if not addicted to, global surveillance. This program went on for more than 50 years, monitoring the communications of more than 100 countries. I mean, the United States came to expect that kind of penetration, that kind of global surveillance capability. And as Crypto became less able to deliver it, the United States turned to other ways to replace that. And the Snowden documents tell us a lot about how they did that. Instead of working through this company in Switzerland, they turned their sights to companies like Google and Apple and Microsoft and found ways to exploit their global penetration. And so I think it tells us a lot about the mindset and the personalities of spy agencies as well as the global surveillance apparatus that followed the Crypto operation.

DAVIES: You know, it's interesting when I take a step back from this and see the CIA running this profit-making company for years and years. You know, law enforcement will often create phony businesses as part of a sting operation in a criminal investigation. And this - you know, intelligence agencies would often give - need to provide cover for their agents operating abroad, so they would appear to be businesspeople. But have you ever seen something like this, where there's an ongoing, long-term, profit-making business owned by an intelligence agency like the CIA?

MILLER: I've never seen anything like this. I mean, I should caveat that and say I've never seen definitive proof of anything like this, right? I mean, these documents erase any ambiguity about that, and so - yeah. I mean, this is not just a front company to enable somebody to travel overseas and to try to recruit a spy inside Moscow or someplace else. This is a profit-making enterprise that goes on year after year, actually making equipment, actually selling it to global sales force with a customer base and revenue and profits that are coming in.

But I will say that there are other modern parallels here, right? I mean, it's not hard to see the connection between this Crypto operation and the very profound concerns that U.S. officials have now about other global companies and their potential ties to governments. I'm thinking of the telecommunications giant Huawei in China or Kaspersky, which is a very successful antivirus and security software company in Russia. These are - I mean, I don't really have much doubt that we'll look back at the moment that we're living through now and learn about Crypto-like operations whether by U.S. spy agencies or other spy agencies.

DAVIES: Well, Greg Miller, it's a fascinating story. Thanks so much for talking to us.

MILLER: Thank you.

DAVIES: Greg Miller covers national security for The Washington Post and is the author of the book "The Apprentice: Trump, Russia And The Subversion Of American Democracy," which has just come out in paperback. His story about the company secretly owned by the CIA and the West German intelligence service was jointly reported with the German public broadcaster ZDF.

Coming up, film critic Justin Chang reviews the new Western "First Cow" from independent filmmaker Kelly Reichardt. This is FRESH AIR.

(SOUNDBITE OF QUINCY JONES' "MONTY, IS THAT YOU?")

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