Former Stasi Cryptographers Now Develop Technology for NATO

[Eugen Leitl]

http://www.spiegel.de/international/germany/0,1518,druck-719726,00.html 

09/27/2010 11:23 AM

Recruited by West Germany

Former Stasi Cryptographers Now Develop Technology for NATO

By Marcel Rosenbach and Holger Stark

After the fall of the Berlin Wall, the West Germans were desperate to prevent
the Stasi's top codebreakers from falling into the wrong hands. from falling
into the wrong hands and set up a company to hire the East German
cryptographers. Now the former Stasi scientists develop technology used by
Angela Merkel and NATO.

Every morning, while going to his office in Berlin's Adlershof district,
Ralph W. passes a reminder of his own past, a small museum that occupies a
room on the ground floor of the building. The museum could easily double as a
command center run by the class enemy in an old James Bond film. A display of
coding devices from various decades includes the T-310, a green metal machine
roughly the size of a huge refrigerator, which East German officials used to
encode their telex messages.

The device was the pride of the Stasi, the feared East German secret police,
which was W.'s former employer. Today he works as a cryptologist with Rohde &
Schwarz SIT GmbH (SIT), a subsidiary of Rohde & Schwarz, a Munich-based
company specializing in testing equipment, broadcasting and secure
communications. W. and his colleagues encode sensitive information to ensure
that it can only be read or heard by authorized individuals. Their most
important customers are NATO and the German government.

Rohde & Schwarz is something of an unofficial supplier of choice to the
German government. Among other things, the company develops bugproof mobile
phones for official use. Since 2004, its Berlin-based subsidiary SIT, which
specializes in encryption solutions, has been classified as a "security
partner" to the German Interior Ministry, which recently ordered a few
thousand encoding devices for mobile phones, at about b,1,250 ($1,675) apiece.
Even German Chancellor Angela Merkel has used phones equipped with SIT's
encryption technology. In other words, the Stasi's former cryptographers are
now Merkel's cryptographers.

Secret Operation

The transfer of Ralph W. and other cryptologists from the East German
Ministry for State Security, as the Stasi was officially known, to West
Germany was handled both seamlessly and discreetly. West German officials
were determined to make sure that no one would find out about the integration
of East Germany's top cryptologists into the west. The operation was so
secret, in fact, that it has remained unknown to this day.

Only a handful of officials were involved in the operation, which was planned
at the West German Interior Ministry in Bonn. In January 1991, Rohde &
Schwarz SIT GmbH was founded. The company was established primarily to
provide employment for particularly talented Stasi cryptologists that the
Bonn government wanted to keep in key positions.

Ralph W. is one of those specialists. W., who holds a doctorate in
mathematics, signed a declaration of commitment to the Stasi on Sept. 1,
1982. By the end of his time with the Stasi, he was making 22,550 East German
marks a year -- an excellent salary by East German standards. And when he was
promoted to the rank of captain in June 1987, his superior characterized W.
as one of the "most capable comrades in the collective." While with the
Stasi, W. worked in Department XI, which also boasted the name "Central
Cryptology Agency" (ZCO).

Looking for the Top Performers

The story begins during the heady days of the East German revolution in 1990.
Officially, the East German government, under its last communist premier,
Hans Modrow, had established a government committee to dissolve the Ministry
for State Security which reported to the new East German interior minister,
Peter-Michael Diestel. In reality, the West German government was already
playing a key role in particularly sensitive matters. Then-West German
Interior Minister Wolfgang SchC$uble (who is the current German finance
minister) had instructed two senior Interior Ministry officials, Hans Neusel
and Eckart Werthebach, to take care of the most politically sensitive
remnants of the 40-year intelligence war between the two Germanys.

The government of then-Chancellor Helmut Kohl was interested in more than
just the politically explosive material contained in some of the Stasi's
files. It also had its eye on the top performers in the former East German
spy agency. The cryptologists were of particular interest to the Kohl
government, which recognized that experts capable of developing good codes
would also be adept at breaking them. The Stasi cryptologists were proven
experts in both fields.

Documents from the Stasi records department indicate that the one of the
Stasi cryptologists' achievements was to break Vericrypt and Cryptophon
standards that had been used until the 1980s. This meant that they were
capable of decoding encrypted radio transmissions by the two main West German
intelligence agencies -- the Office for the Protection of the Constitution
and the Federal Intelligence Service (BND) -- and the West German border
police. The East Germans even managed to decode the BND's orders to members
of the clandestine "Gladio" group, which was intended to continue
anti-communist operations in the event of a Warsaw Pact invasion of Western
Europe.

The West German government was determined to prevent these highly trained
East German experts from entering the free market. The idea that specialists
who had spent decades working with West German encryption methods and had
successfully cracked West German intelligence's codes could defect to Middle
Eastern countries like Syria was a nightmare. Until then, the BND had had no
difficulties listening in on intelligence communications in the Middle East,
an ability the potential defection of Stasi experts would likely have
compromised. Bonn also hoped to use their skills to break into regions where
its own agents were making no headway. All of this meant that the Stasi
experts had to be brought on board in the West -- even if it involved
unconventional methods.

Cherrypicking the Stasi's Top Brains

The government officials in Bonn turned to an expert for advice: Otto
Leiberich, a cryptologist and mathematician who had headed the Central Office
for Cryptology, the equivalent of the Stasi's ZCO at the West German BND,
until the mid-1970s. Leiberich's task, after he was brought in as a member of
the secret operation, was to evaluate the professional abilities of the Stasi
experts.  Leiberich still has vivid memories of his first official trip to
the town of Hoppegarten, next to Berlin. One of the East German cryptologists
at the meeting greeted the members of the West German delegation as
"comrades," Leiberich recalls. He was impressed by the East Germans'
expertise, says Leiberich. "They were excellent mathematicians who were not
personally guilty of any misconduct."

Leiberich says he would have liked to hire them, particularly the Stasi's
then "chief decoder," the ZCO department head, Horst M. A gaunt chain-smoker
who wore horn-rimmed glasses, M. was born in 1937 and had earned a degree in
mathematics at East Berlin's Humboldt University. But the West was also
interested in younger people, in the expectation that they would be of
greater value in the nascent computer age.

A Free-Market Solution

Leiberich could have used the extra manpower, especially after 1990, when the
West German Central Office for Cryptology was spun off from the BND and a law
was enacted to form the new Federal Office for Information Security (BSI).
Leiberich, who was named the BSI's first president, headed a team consisting
mainly of former intelligence colleagues.

But Neusel, the senior official from the West German Interior Ministry,
dismissed the idea as too precarious. Firstly, the government had decided not
to integrate former Stasi officials, because of their past activities, into
the bureaucracy of a unified Germany. Additionally, as one person involved in
the operation recalls, concerns about potential traitors gave rise to a
"sacred principle," namely that "no one from the Stasi was to be transferred
to the West German intelligence agenciewith the Stasi for eight years, also
fitted the desired profile, as did his colleagues Wolfgang K. and Volker S.
In total, about a dozen former Stasi employees, most of them mathematicians,
were given the chance to embark on a second cryptology career in
post-reunification Germany.

The federal government provided whatever assistance it could, but only with
the utmost discretion. SIT was initially headquartered in the town of
GrC<nheide in the eastern state of Brandenburg, in a former Stasi children's
home.

'Cosmic Top Secret'

An episode from the 1990s shows how conspiratorially the operation was
handled, even within the West German intelligence community. When the BND
needed a "D-channel filter" -- a precursor to today's firewalls -- to protect
communications networks, it contacted the Federal Office for Information
Security (BSI). But BND officials pricked up their ears when they discovered
that the work was being done by SIT. A private company protecting the
computers of Germany's foreign intelligence agency? Nevertheless, the BND
officials were told that it was "totally OK," and that the BSI would take
responsibility for SIT.

For the parent company Rohde & Schwarz, the former problem child in
Brandenburg soon became a success story. SIT took over the cryptology
division of German engineering giant Siemens, and the company now employs
about 150 mathematicians, engineers and computer scientists at its three
locations. SIT, which proudly refers to itself as the "preferred supplier of
high-security cryptography" for NATO, even includes in its product line
devices classified as "Cosmic Top Secret," NATO's highest secrecy level.
SIT's Elcrodat solution, standard equipment on NATO submarines, frigates and
military helicopters, has provided the company with orders worth millions for
years.

When approached by SPIEGEL, Rohde & Schwarz declined to comment on this
previously unknown part of its company history.

To show its gratitude for the company's efforts, the federal government did
more than just provide it with lucrative contracts. Eckart Werthebach, the
Interior Ministry official, awarded the former managing director of SIT, a
senior Rohde & Schwarz executive originally from West Germany, the Order of
Merit o at Villa Hammerschmidt in Bonn, the former official residence of the
German president.

Translated from the German by Christopher Sultan