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Mossad and the Rise of the VC-Spy Alliance

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Libertad Ventures is the VC arm of Israel's Mossad

The growth of intelligence agencies in the 21st century has been powered by the development of new technologies, created by start-ups, which are powered by intelligence agencies. This unvirtuous circle of money and espionage is a new and daunting challenge for civil liberties and human rights groups.

The U.S intelligence community has a venture capital organization, Inqtel, founded by the CIA in 1999. Israel’s Mossad has Libertad Ventures, founded in June 2017.

As The Times of Israel reports

Libertad was set up as a strategic investment arm of the Mossad. Its purpose is to help build the organization’s technological capabilities and create a bridge to the Israeli startup industry. Since its establishment, the fund has received hundreds of applications from both Israeli and foreign entrepreneurs, the statement said. The Mossad, the Shin Bet security agency and even the Israeli army are stepping out of the shadows and opening up to working with civilian firms, as greater cooperation is needed .

“Stepping out of the shadows” is another way of saying intelligence services are increasingly open about what they used to do secretly.

Inqtel’s board of trustees is an all-star team of Silicon Valley bankers and intelligence agency operatives, including former CIA director George Tenet. Its alumni includes dozens of high tech firms. Libertad, by contrast, says it will not disclose the name of companies it funds.

The alliance of venture capital and secret intelligence professionals serves the needs of both. The technologists gets funding. The spies get cutting edge tools to surveill enemies, control dissidents, and wage war: spyware, facial recognition technology, and autonomous weapons to name a few.

Some of these technologies may make the public safer–detection of chemical and nuclear weapons–but all of them make secret intelligence agencies stronger.

Israeli’s NSO Group exemplifies the VC-spy alliance. Created by veterans of Israeli signals intelligence service in 2011, NSO created the Pegasus software that can covertly take control of a mobile phone, copy its data and turn on the microphone for surveillance, all via a single phone call via What’sApp. NSO spyware has been licensed to dozens of countries including Saudi Arabia, Mexico, Bahrain and the UAE.

In February, Novalpina Capital, a London-based hedge fund, bought a controlling interest in the NSO Group. Spyware, it seems, is a high-growth investment opportunity.

‘Well-Founded Fear’

Pegasus may be sophisticated but it doesn’t distinguish between good guys and bad guys.

Israeli press reports say Mexico claims Pegasus helped track down cartel kingpin Joaquin “El Chapo” Guzman. But the Mexican security forces also used Pegasus to track, harass and deter human rights activists demanding an investigation into the disappearance of 43 students in 2014. The Mexican government has refused to investigate or hold anyone accountable for the disappearances.

Last year, Omar Abdulaziz, a Saudi dissident based in Montreal, filed a lawsuit in Israel in which he claimed that NSO software had been used to target his phone at a time when he was in regular contact with the journalist Jamal Khashoggi, who was later slain by Saudi intelligence agents.

Last week Amnesty International called on the Israeli government to bans the export of Pegasus spyware, saying it was used to spy on Amnesty investigators in Israel.

Amnesty’s  affidavit concludes that its staff “have an ongoing and well-founded fear they may continue to be targeted and ultimately surveilled” after a hacking attempt last year.

NSO’s owners are seeking to deflect the allegations. In a 26-page letter sent to Citizen Lab in February, NSO said it wants to become “more transparent” and “do whatever is necessary” to ensure its technology is used for fighting terrorism and serious crime and “not abused in a manner that undermines other equally fundamental human rights.”

The lawsuits show that private citizens and non-governmental organizations are in the forefront of the effort to hold privately-funded intelligence firms accountable. As the VC-spy alliance grows, governments are missing in action.

WATCH: Libertad Ventures wants your ideas

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