Few allies rely on the US as much for strategic and economic support. None of the countries that receive significant foreign aid from the US actively spy on it. Additionally, it is rare for close allies to engage in both economic and strategic espionage against the US. Besides espionage, no US ally has violated US national security-related agreements and laws more often. These violations include misusing US foreign aid, illegally transferring sensitive US technologies to other countries and breaking the rules on how US military items provided to Israel should be used.

Amid espionage scandals involving such figures as Jonathan Pollard—an American who spied for Israel in the 1980s—and Franklin Lawrence—involved in another espionage case—Israel’s motivations seem to be threefold. First, they aim to strengthen their industrial base. Second, they sell or trade the information with other countries, especially China, for profit. And last, they use the information to build favourable political ties and secure alternative sources of arms and intelligence. UK-based investigative media Grey Dynamics has reported on these activities.

Issue of Israeli Economic Espionage

1.      Some time in the beginning of March, the US Treasury Department banned two individuals and a Greece-based spyware company led by former Israeli military officer Tal Dilian. The company developed and distributed technology used to target US government officials, journalists and policy experts, according to reports from the Associated Press.

2.      In November 2021, the Biden Administration’s State Department blacklisted Israel’s NSO Group, ‘Niv, Shalev and Omri’—named after its founders—a company known for its spyware tools. Despite this ban, the US government reportedly purchased a tool from the NSO Group that can track mobile phone users globally. This situation illustrates the challenge of banning spyware that may still be useful for intelligence purposes, according to reports by Defense One.

3.      In 2014, an NSA document revealed that Israelis were exceptionally good partners in the field of signals intelligence (SigInt). However, the document also noted that Israel targeted the US to understand its stance on Middle East issues, according to The Intercept. A top-secret 2008 document includes an interview with the NSA’s Global Capabilities Manager for Countering Foreign Intelligence, titled ‘Which Foreign Intelligence Service Is the Biggest Threat to the US?‘ His most-mentioned name as the main threat was that of Israel.

While acknowledging that Russia and China were the most effective at spying on the US, he also mentioned, “Israel targets us, too”. He noted that a National Intelligence Estimate (NIE) ranked Israel as the third-most aggressive intelligence service against the US.

4.      The National Counterintelligence Center (NaCiC) has identified Israel as actively working against US interests. Since its foundation in 1948, Israel has engaged in espionage in the US, particularly economic espionage. This activity mainly targets military and dual-use items—goods and technology with both civilian and military applications—to achieve both strategic and economic goals, according to the Institute of Palestine Studies.

5.      In 1996, Cambridge University Press documented that the CIA publicly exposed Israel for being “extensively engaged in espionage”. Over and above, the US General Accounting Office (GAO) published a report stating that Israel, in contrast with any other ally, carried on the most aggressive espionage operations against his country. The report noted that Israel regularly engages in state-sponsored espionage to steal classified military information, sensitive military technology and sensitive US economic information.

6.      The book, ‘The Samson Option‘, notes that the creation of Israel’s Office of Special Tasks, responsible for scientific and technical espionage LAKAM—Lishkat Ha-Kesher in Hebrew, which translates to ‘Bureau of Liaison‘ in English—in 1960 focused on technical infiltration and network acquisition. According to a CIA report, LAKAM prioritized collecting scientific intelligence in the US, reports Grey Dynamics.

May Deny Charges of Spying on US

1.      POLITICO‘s December 2019 report says the US government has come to the conclusion within the past two years that Israel was, possibly, behind planting cell phone surveillance devices found near the White House and other sensitive areas in Washington. This conclusion comes from three former senior US officials. These small surveillance devices, known as ‘StingRays‘, imitate regular cell towers to trick cell phones into revealing their location and identity information.

Termed officially as international mobile subscriber identity (IMSI) catchers, they also have the capacity to capture call content and data usage. An Israeli Embassy spokesperson, Elad Strohmayer, denied that Israel had placed the devices.

2.      In a September 2019 Bloomberg publication, Israeli Prime Minister Benjamin Netanyahu strongly denied a report that Israel may have planted listening devices in sensitive areas of Washington. His office called the report “a blatant lie”.

3.      According to a 2015 Foreign Policy article titled ‘Spy vs Spy, America and Israel Edition‘, Israel firmly denies conducting espionage against the US, as underscored by Israeli Defence Minister Moshe Yaalon.

Unlikely to Affect Intel Cooperation

1.      According to a CRS Issue Brief by the Foreign Affairs and National Defense Division, since the 1996 US-Israel Counter-Terrorism Accord, the US has continued to store munitions in Israel and increased financial aid for Israel’s counter-terrorism efforts and ballistic missile defence.

2.      Duncan L. Clarke, a former senior US defence intelligence official, explains in a report in the Journal of Palestine Studies the impact of different kinds of espionage on US-Israeli relations. He said that issues related to national defence had a higher chance of affecting bilateral cooperation.

The Pollard espionage scandal, where Jonathan Pollard, an American analyst, was caught spying for Israel in the 1980s, caused significant tension and disruption in US-Israeli relations since it directly involved national security and defence information. On the other hand, economic espionage operations have a less severe impact on overall cooperation between the US and Israel as these operations are viewed as less threatening to national defence.

Conclusion

High confidence is placed in the assessment that Israel’s ongoing economic espionage will become a strategic liability for the US. Israel, expectedly, will deny any espionage charges on US soil. Additionally, Israeli espionage operations are unlikely to disrupt intelligence sharing between the US and Israel, says Grey Dynamics.