Cameramaker Red claims espionage

variety.com
In a saga worthy of a Hollywood thriller, allegations of email hacking and industrial espionage have surfaced in the camera industry in a lawsuit filed by digital camera maker Red against rival Arri.

In the suit filed Dec. 21 in federal court in Orange County, Calif., Red accuses Arri of stealing technical details and development plans for Red cameras, giving Arri an unfair advantage.

Much of Red's complaint rests on facts revealed in an August plea deal between federal prosecutors and former Arri executive Michael Bravin, who is also a defendant in the suit. Bravin pleaded guilty to a misdemeanor charge of email hacking, admitting as part of the deal that he accessed the email account of Band Pro chief executive Amnon Band.

Bravin, who according to his LinkedIn profile worked for Band Pro for more than 16 years, resigned as Band Pro's chief technology officer to become Arri's VP of market development for digital camera products in January 2010.

From around December 2009 through June 2010, Bravin had access to Amnon Band's email account, as Bravin has admitted. Under his plea deal, he was to serve two months in jail and pay $20,000 in restitution to Band Pro as well as legal costs. Bravin now lists himself on LinkedIn as principal at the Digital Picture Co.

In its complaint, Red asserts that during the time Bravin was hacking Band's email account, Band Pro and Red were discussing a possible joint venture. Red says Band's emails contained detailed descriptions of the technology used in Red's cameras and Red's plans for introducing new models and features.

Red alleges that Bravin passed that information to Arri, giving Arri an unfair competitive advantage, especially with respect to the launch and marketing of the Arri Alexa camera. The Alexa was released in 2010 and is seen as a direct competitor to Red's Epic.

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Israel Convicts Conspirator Who Wiretapped Michael Cherney

israelnewsagency.com

Jerusalem, Israel --- October 26, 2011 .... On October 24th the Jerusalem Magistrate's Court in Israel convicted far-right activist Avigdor Eskin of ordering the illegal wiretapping of associates of Israel businessman and philanthropist Michael Cherney (Mikhail Chernoy).

The plea bargain consists of a penalty of six months of community service, probation and a fine of NIS 20,000.

According to the original indictment, filed in January 2011 by the Israel State Attorney's office, Eskin was contacted in 2007 by a Russian citizen, Alexei Drobashenko, who asked him to gather information about Michael Cherney in order to use it in a smear campaign.

At that time Alexei Drobashenko was the head of the External Relations Department at Basic Element, a financial and industrial group that belongs to Oleg Deripaska. Deripaska and Cherney are former partners in an aluminum business. In 2006 Cherney filed a law suit against Oleg Deripaska in the UK's High Court.

Cherney is seeking a 20 percent stake in RUSAL, a multinational aluminum producer. The trial is expected to go ahead in April 2012.

In February 2008, Cherney filed a suit in a Tel Aviv court, accusing a group of 10 conspirators, allegedly funded by Oleg Deripaska, of illegal wiretapping, hacking the computers of his charity fund - The Michael Cherney Foundations, publishing slanderous articles, harassing him with insulting graffiti and leaflets, hiring a UK PR company to plant hoaxes about Cherney into the UK media and Wikipedia.

The purpose of that smear campaign was allegedly to derail Cherney's lawsuit against Deripaska in UK's Commercial Court.

Aviv Mor, an Israel private investigator, together with another PI, Rafael Pridan, carried out wiretaps against Cherney's secretary Elena Skir and another of Cherney's associates, the indictment contended.

The indictment further charged that Eskin was the link between Mor and Pridan and Drobashenko, that he paid them each NIS 50,000 in cash for their services and that he also received translations of the wiretapped conversations.

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FBI: Tech firms face spy risk

democratandchronicle.com


Kexue Huang, a scientist and native of China, pleaded guilty last week in a federal court to swiping millions of dollars worth of trade secrets from Dow Chemical Co. and Cargill Inc. for other people doing research in Germany and China.


A federal jury last month ordered South Korea's Kolon Industries to pay DuPont Co. $920 million for stealing trade secrets regarding synthetic fibers used in such products as Kevlar body armor. A former DuPont engineer hired by Kolon, Michael Mitchell of Virginia, was sentenced in March last year to 18 months in prison for theft of trade secrets for passing on key DuPont data to Kolon.

And area technology companies are likely fooling themselves if they think they're not in the cross-hairs of such spy efforts, according to the Federal Bureau of Investigation. "If you haven't been a victim yet, it's because you have been and you don't know it, or you will be," Barry W. Couch, a special agent with FBI's Buffalo division, told a conference room full of area optics industry executives last week. "Don't be blindsided."

Chili's Sydor Optics played host as the FBI spent a handful of hours talking about counterintelligence and economic espionage issues, with handouts and a video presentation all revolving around the message that companies are under siege by foreign economic competitors, often with explicit help from foreign governments.

Optics in particular "is a targeted industry," said FBI special agent Chad Kaestle. Other frequently targeted technologies include sensors, aeronautics and marine systems.

Former Akamai employee in Mass. to plead guilty to economic espionage

washingtonpost.com

BOSTON — A former employee of a website content delivery company has agreed to plead guilty to a charge of foreign economic espionage for providing company trade secrets to an undercover FBI agent posing as an Israeli intelligence officer, federal prosecutors announced Thursday.

Elliot Doxer, 42, will admit to providing trade secrets from Cambridge-based Akamai Technologies Inc. over an 18-month period to the agent, whom he believed was an Israeli spy, the U.S. Attorney’s Office for Massachusetts said in a statement. A plea hearing is scheduled for Aug. 29.

Doxer’s attorney, Thomas J. Butters, did not return messages left after business hours Thursday.

Doxer, of Brookline, worked in Akamai’s finance department at the time he committed the alleged offenses. Prosecutors said he sent an email to the Israeli consulate in June 2006 and offered to provide any information he had access to in order to help that country in exchange for $3,000. Doxer said his main goal was “to help our homeland and our war against our enemies,” prosecutors said.

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10 Most Notorious Acts of Corporate Espionage

businesspundit.com
There’s no end to the skullduggery that businesses will get involved in with the aim of making a quick buck, or trying to keep up with their competitors. Of course, their fellow companies aren’t beyond their schemes, either. There’s a war going on out there, folks, and spying is part of the game – criminal or not. Corporate espionage was a normal way of doing business back in days gone by, before copyright and patent protection brought the long arm of the law into play, but some companies still engage in the practice of acquiring trade secrets and business information by any means necessary. Here are 10 infamous cases of industrial espionage.

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Protecting Your Country While Protecting Your Clients

channelinsider.com

Think your small business customers are too small to be of interest to international spies looking to steal trade secrets and intellectual property? Think again. Corporate espionage is a real threat. Here's how you can help.

Recently I was surprised to learn how far espionage has moved from the traditional Cold War spying that focused on the Russians stealing our government secrets, to a new type of espionage designed to steal trade secrets and intellectual property. The targets aren’t all multi-national corporations, but include small businesses like the ones we service. Most of the threats come from China.

Brett Kingstone’s 80-person fiber-optic lighting company, Super Vision, was targeted by a Chinese government shell company which bribed one of Kingstone’s key employees to steal designs and process secrets. The Chinese then set up a company to duplicate Super Vision’s products and offer them at low prices, since the cost of stealing was a fraction of the cost of Super Vision’s research and development.

In his book, The Real War Against America (Specialty Publishing Company, 2005) Kingstone describes how he was challenged by his distributors when they found his company’s products being offered for much lower prices. Kingstone was confused until he was able to get samples, which matched Super Vision’s products in every way. Through a spy-thriller ordeal that included bribes, threats, shredded evidence, stolen equipment, fraudulent bankruptcy filings, an FBI investigation, and private investigators posing as Arab sheiks, Kingstone was able to get a $33.1 million civil judgment even though the culprits avoided criminal prosecution.

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French probe industrial espionage at defense firm unit

ca.reuters.com

PARIS (Reuters) - France's intelligence services have unearthed a case of suspected industrial espionage at an engine subsidiary of French aerospace and defense firm Safran, Le Monde newspaper said in its weekend edition.

A Safran spokeswoman declined to comment on Sunday when contacted by Reuters about the report, which spoke of a Chinese link.

The newspaper said investigators had placed about 10 people in custody as they dig for information about a 2010 attack on the computer networks of Safran subsidiary Turbomeca, which makes helicopter engines.

It said hackers broke into the computer networks and gained access to sensitive information about propeller systems at Turbomeca, as well as Safran documents containing information about billing and the cost of various company projects.

The computer break-ins took place during the first eight months of 2010 and may have involved help from company insiders, Le Monde reported it was told by an unnamed judicial source.

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China and Russia fingered in German industrial espionage alert

monstersandcritics.com

Berlin - Industrial espionage by China and Russia is becoming easier thanks to computer hacking, officials warned German business leaders on Thursday, adding that police need data logs to track computer break-ins.

A conference heard that the annual cost to German companies of data theft was at least 20 billion euros (nearly 30 billion dollars).

However it is often easier to simply buy corporate secrets from disloyal employees.

Ole Schroeder, a senior Interior Ministry official, said that in 70 per cent of known cases, staff who hated their employer or were angry that they were likely to lose their jobs were behind the leaks.

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Corporate spying goes unreported

investors.com

SANTA MONICA, Calif. (MarketWatch) — International industrial espionage is on the rise as cyber criminals shift their activities to stealing trade secrets from taking personal data and information.

A new research report from McAfee, the Internet security firm, says, “Globalization and the commoditization of information technology have driven businesses to store increasing amounts of precious corporate data in the cloud. As this shift has taken place, cyber criminals have discovered new ways to target this precious data, both from inside and outside the organization.”

The report, “Underground Economies: Intellectual Capital and Sensitive Corporate Data Now the Latest Cybercrime Currency,” also says many companies are reluctant to thoroughly investigate cyber breaches for fear of publicity and because investigations are costly.

Companies worldwide are estimated to lose more than $1 trillion due to data leaks, costs of remediation and reputational damage.

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McAfee says corporate espionage is the target for cyber crime

computerworlduk.com

Hackers using trade secrets as underground currency

Corporate espionage is a business almost as old as corporations, but thanks to the Internet revolution it has a new business model: cybercrime. A new report from McAfee illustrates how intellectual property and trade secrets are becoming the primary target for hackers, and providing the currency that fuels the cyber underground.

The recent attack against RSA, resulting in the compromise of sensitive data related to the SecurID two factor authentication that many corporations rely on to guard against unauthorised access and protect data, is an example of how even the very companies that we trust to help guard against corporate espionage are not invulnerable themselves. Hacked SecurID tokens could be used as a stepping stone to more serious corporate espionage.

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'Corporate espionage' center of court case

bizjournals.com

A State Supreme Court Justice has barred a national appliance parts distributor from soliciting business and clients from a competitor, who happens to have deep Buffalo roots.

State Supreme Court Justice John Michalek, in a recently unsealed decision, has ruled that 1st Source Servall, which opened a Buffalo sales office shortly after St. Louis-based Marcone Supply Co. acquired AP Wagner Co. in January 2010. AP Wagner began in Buffalo in 1928 when it was founded as Buffalo Washing Machine Repair Co. Marcone and 1st Source Servall are the largest appliance parts distributors in the country.

Read more: 'Corporate espionage' center of court case | Business First

Protecting critical information assets from industrial espionage

securitypark.co.uk
Organisations have been the target of electronic espionage for as long as information has been held in data format. As business becomes dependent on technology to process, store, transmit and manage information, electronic forms of espionage have sky rocketed. People will always be the weakest link in the battle to protect corporate information and data from attackers.

As the capabilities of security technology improve, hackers are now targeting individuals to get at the electronic information they want – this raises an intriguing mix of problems and issues for today’s corporate security managers

Attacks on businesses are increasingly being committed with a similar modus operandi to corporate espionage carried out by foreign states and state sponsored attackers. With the emergence of global markets and global competition, businesses are now the target of espionage, carried out by competing businesses, states or state-sponsored businesses.

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Renault says probe into spying claim continues

bbc.co.uk
Carmaker Renault has said that investigations are continuing into possible foreign bank accounts linked to alleged industrial espionage.
However, a lawyer for the French company said there was no clear evidence yet of accounts in either Switzerland or Lichtenstein.

He was responding to reports in France that a police probe into three former managers had so far drawn a blank.

But Jean Reinhart told Europe 1 radio that Renault remains a "victim".

Allegations that Renault was the subject of industrial espionage surfaced in January.

Three Renault managers were sacked amid a flurry of claims in the French media that a Chinese company may have sought secrets about a new electric car.

Beijing categorically denied the suggestion and Renault never confirmed that China was under suspicion.

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Former Apple boss prosecuted for industrial espionage

In a move which has sent shockwaves around the mobile phone and computer technology world, it’s been reported that a former Apple boss was prosecuted for industrial espionage.

Paul Devine was global supply manager for Apple, but he sold the company’s secrets to Asian suppliers. This apparently gave the Asian businesses greater negotiating clout with Apple, and which adversely affected Apple’s costs.

A reporter told knowyourmobile.com: “Mr Devine admitted that the loss to Apple from his actions was more than £1.2m.”

Mr. Devine was arrested last August after incriminating emails were found on his computer. The emails appeared to show that he would be willing to provide information in return for being paid.

Paul Devine admitted charges of wire fraud, money laundering and conspiracy and will be formally sentenced shortly.

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Why Take a Preventive Approach to TSCM?

All too often corporations or individuals hire a professional Technical Surveillance Countermeasures (TSCM) or "bug sweep" service provider only after they have a strong suspicion they are a victim of illegal eavesdropping. While it may seem like a logical approach to verify your suspicions first, the choice to delay can be an irresponsible and costly choice. Every minute an illegal eavesdropper maintains access to your information is valuable to the eavesdropper -- and costly to you. The longer you wait, the more opportunity the eavesdropper has to gather enough competition sensitive, company proprietary or damaging personal information to cause your company, or you, irreparable harm.

Read more here...

Beware China's 'honeytrap' spies

artemis.theweek.com

According to intelligence agencies, China is enlisting beautiful women for corporate espionage in the West. How does the dreaded "honeytrap" method work?

According to leaked French intelligence files, China has been employing beautiful female spies — the dreaded "honeytrap" method — and blackmail to steal business secrets from French executives. And it wouldn't be the first time that China has used such tricks to gain access to privileged information. Here, a brief guide: How does the "honeytrap" work?
A beautiful woman wines, dines, and even beds a mark to get information from him, a la many a Bond flick. The French intelligence reports cite a case in which a young Chinese woman slept with a top French researcher at a major pharmaceutical company, a man unaware that she was a spy and that the encounter had been videotaped. "When he was shown the recorded film of the previous night in his hotel room... he proved highly cooperative," says an intelligence official.

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China catching EU on innovation, amid industrial espionage scandals

euobserver.com

EUOBSERVER / BRUSSELS – China is catching up fast with the EU in research and innovation, according to a study published by the European Commission ahead of a meeting of EU leaders on the same issue. But industrial spying scandals in France and the US have painted China's economic ambitions in a disturbing light.

The US and Japan are way ahead of Europe, while China and Brazil are catching up fast with the old continent in the number of patents issued, private and public expenditure dedicated to research and development, and academic research on cutting-edge technologies, the EU's latest "Innovation Union Scoreboard 2010" shows.

Within the EU, Sweden is top, followed closely by Denmark, Finland and Germany. Latvia, Bulgaria, Lithuania and Romania are at the lower end.

"The scoreboard highlights the innovation emergency in Europe," EU commissioner for innovation, research and science, Maire Geoghegan-Quinn said. "If Europe stands still we will see the US disappear into the distance just as we feel emerging nations breathing down our necks."

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French warn of Chinese industrial espionage

theage.com.au

CHINA is using honey traps and spying interns in industrial espionage, according to leaked French intelligence files.

One report claimed a top French researcher was wined and dined by a Chinese woman and ended up in bed with her.

''When he was shown the recorded film of the previous night in his hotel room … he proved highly co-operative,'' an intelligence official said.

In another case, an unnamed French company realised that a sample of its patented liquid had left the building after a visitor from a Chinese delegation dipped his tie into the liquid to take home a sample.

Companies should do more to protect themselves from prying eyes among the 30,000 Chinese students on internships in France, experts warned.

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French spooks become embroiled in Renault's spy saga

theaustralian.com.au
THE Renault spying saga has taken a new turn with the car maker accusing France's intelligence agency of sabotaging its reputation.

Jean Reinhart, Renault's lawyer, said that the Central Directorate of Interior Intelligence had leaked details of the inquiry into accusations of industrial espionage.

He claimed it had done so in revenge for being kept in the dark by the company when the allegations first surfaced last year.

The comments came as it emerged that French secret services had searched Renault's offices this week to try to shed light on claims that three of its executives had sold confidential information on electric vehicles to Chinese spies.

Michel Balthazard, vice-chairman of pre-engineering; Bertrand Rochette, head of pre-projects; and Matthieu Tenenbaum, the deputy head of Renault's electric vehicle program, were dismissed after an internal investigation.

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Protecting against industrial espionage

canadianmanufacturing.com
How do you prevent competitors from stealing your ideas?

When three executives at Renault in Paris, France, were suspended and accused of leaking key company information to China, it came as no surprise to those in the highly competitive automotive manufacturing industry.

While GM would not comment specifically on information about security initiatives citing competition, Jason Easton, corporate communications manager for General Motors of Canada Ltd., said “at GM of Canada we are very conscious of confidentiality and competitiveness issues. While many of these issues have always existed—automobiles are one of the highest technology retail products available to consumers—the mediums through which information can be transferred, and the speed at which this can happen, are the challenges that many companies face.”

Canadian Metalworking Online also contacted Ford Motor Company and Chrysler, but neither of the companies would provide comments about measures they take to protect against industrial espionage.

In the Renault case, the three executives were suspected of leaking information related to the company’s electric vehicle program. The multi-billion dollar program is a key part of Renault’s growth strategy and has been working with Japanese partner Nissan.

According to a Reuters press wire story on January 7, this isn’t the first time France’s car industry has been hit by information leaks. In 2007, a Chinese student doing a work placement at car parts maker Valeo was given a prison sentence for obtaining confidential documents from the automaker.

How do you protect your company and your manufacturing ideas from competitors?

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