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Analysis - Spycraft, contacts still key in espionage world

LONDON (Reuters) - Smartphones and e-mail might be revolutionising espionage, but old-style personal spycraft is as important as ever when it comes to protecting -- or breaking -- state and corporate secrets.

The rise of “state capitalist” economies that may use government intelligence agencies to win commercial advantage for official-linked companies could pose a growing threat to their Western corporate rivals, experts say.

China, Russia, Saudi Arabia, United Arab Emirates and India either have or are all pushing for security agency access to encrypted BlackBerry smart phones, which they say they need to monitor dangerous militants.

But while the skills of electronic snooping are important, where information ends up can come down just as much to private deals put together in anonymous offices by spy chiefs, companies and powerful individuals.

“In somewhere like the UAE, if I was the CIA or MI6 station chief I might go to the head of local intelligence and ask for help in following or monitoring someone,” said Fred Burton, a former U.S. counterterrorism agent now vice president for U.S. political risk consultancy Stratfor.

“If the Chinese station chief comes to him and makes a similar request, you want to be in a position where he is going to tip you off about it. A lot comes down to these personal relationships. Whoever has the best liaison relationship obtains the information.”

What technology has revolutionised, of course, is how much can be stolen. Electronic hacking can lift truckloads of documents with barely a trace. But older tradecraft continues.

In some countries, hotel rooms are bugged and some local staff -- particularly cleaners and drivers -- may be being paid extra to keep an eye on their employers.

Local intelligence agencies -- from small sub-Saharan African countries to global powers -- may also have particularly close relationships with other powers. Many are legacies of the big power’s Cold War practice of cultivating local proxies.

SHADOWY RELATIONSHIPS

How much support Western corporates received from their national intelligence services is similarly opaque -- but once again, personal contacts look likely to be key. Some firms have a reputation for being particularly well-connected.

Officials from Britain’s MI6 spy agency and Foreign Office, for example, have previously gone on to work for U.K. firms such as energy giant BP after leaving public service.

The MI6 website publicly acknowledges that the service acts in the interests of the economic well-being of the U.K., as well as on national security, defence and crime.

In more opaque emerging economies, it is generally accepted that intelligence and security officials may sell information or security access to the private sector for personal gain.

In Western economies, that is much less widespread -- but Burton says it is far from unheard of.

“People using intelligence resources for their own private ends?” he said. “I’d love to say it doesn’t happen. Doing someone a favour, maybe getting yourself a nice position on a board when you go into the private sector? It happens. Even in the United States.”

Analysts say help provided by Western intelligence officers to personal contacts in companies more often will involve giving additional protective advice or tipoffs to firms that might be targeted by criminals or foreign intelligence agencies, rather than using government spy assets to snoop on rivals.

Alastair Newton, who worked for Britain’s foreign office on both cyberwarfare and trade and is now senior political analyst for Japanese bank Nomura, says maintaining a good relationship with your embassy and government has its advantages.

“If you’re on a trip to Ruritania organised by UK Trade and Industry (department) and you get a briefing from the High Commissioner on business opportunities, you won’t ask exactly where he got his information from,” he says -- deliberately choosing an imaginary country.

“You just assume he knows what he’s talking about.”

(Additional reporting by Tom Bergin)

Editing by William Maclean

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