The intelligence coup of the century: how spies sold rigged encryption

Wars & Conflicts · Published 9 October 2026 Swipe more like this →

In short: For decades, the CIA and West German BND operated a massive deception through a Swiss company. By selling compromised encryption technology to nearly 130 nations, they turned global diplomatic and military communications into an open book for Western intelligence services.

Operation Rubicon, originally known as Operation Thesaurus, was a joint covert program between the U.S. CIA and the West German BND. From 1970 until the early 1990s, the two agencies secretly owned and influenced Crypto AG, a leading Swiss manufacturer of encryption technology. By selling devices with manipulated algorithms, the agencies could intercept and read the encrypted communications of approximately 100 different states. The scheme was facilitated by Siemens AG, which manufactured the necessary teleprinters and provided management for the firm for two decades. This arrangement allowed the intelligence services to maintain a facade of Swiss neutrality and integrity.

The impact of this operation was profound and spanned multiple geopolitical crises. During the 1978 Camp David Accords, the NSA read Egyptian communications to understand their negotiating position. In the 1982 Falklands War, the ability to decode Argentinian communications proved fundamental to the conflict. The operation even provided intelligence during the 1989 U.S. invasion of Panama, revealing that President Manuel Noriega was hiding in the Vatican embassy. This intelligence advantage extended to the United States' intervention in Chile, where decrypted messages from Salvador Allende's government were utilised. Additionally, the NSA's machine decryption capabilities were significantly bolstered, with the operation accounting for nearly 40% of their total output.

However, the operation was not without risk or controversy. The compromised technology created vulnerabilities that third parties could exploit; for instance, the KGB and East German Stasi successfully deciphered Turkish diplomatic reports. Furthermore, the BND's ability to read the communications of allies like Italy and Spain caused internal disputes with the CIA. The operation's exposure in 2020 revealed that the intelligence services had maintained detailed knowledge of human rights violations, such as the Argentine military dictatorship's actions, while maintaining standard diplomatic relations with those regimes. The program's secrecy was compromised when a Swiss employee was detained in Iran, an incident known as the HYDRA affair. This security breach eventually led the German government to withdraw from the operation in 1993 due to heightened political risks.

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