UPDATE - CIA, Germany's BND secretly owned key encryption firm

ADDS DETAILS THROUGHOUT

By Michael Hernandez

WASHINGTON (AA) - The CIA and Germany's intelligence agency secretly owned a Swiss company used by governments to send encrypted communications for decades, according to a report published Tuesday.

Crypto AG was used by U.S. allies and adversaries, including more than 120 countries. Among Crypto's clients were Iran, India, Pakistan, and the Vatican.

None knew of Crypto's ownership under the CIA and Germany's BND, according to a CIA history and corresponding narrative from the German intelligence agency obtained by the Washington Post and Germany's public broadcaster, ZDF.

Both of the intelligence agencies rigged the encryption services sold by Crypto so that the communications that would ultimately be sent could be easily hacked.

“It was the intelligence coup of the century,” the CIA report obtained by the news outlets concludes. “Foreign governments were paying good money to the U.S. and West Germany for the privilege of having their most secret communications read by at least two (and possibly as many as five or six) foreign countries.”

The CIA and the National Security Agency (NSA), which at the time was tasked largely with codebreaking, owned Crypto in partnership with the BND from 1970 on, with the American intelligence firms controlling "nearly every aspect of Crypto’s operations," according to the Post.

The BND would leave the operation in the early 1990s due to fears that the plot would be exposed, but the CIA then bought the former German shares, maintaining control over Crypto until 2018 when it sold its shares, anonymous current and former officials told the newspaper.

The Post said by that time Crypto's importance had waned electronic encryption became the norm.

But while they jointly held ownership over Crypto the intelligence agencies each appraised the operation as wildly successful as the business generated millions of dollars in split profit.