Wednesday, 23 April 2014

MfD: BIS offers "tax-free money" for encryption system

14 September 2010

Prague, Sept 13 (CTK) - The Czech counter-intelligence service (BIS) has offered "tax-free money" to the CircleTech private firm for an encryption system, the daily Mlada fronta Dnes (MfD) writes Monday.

CircleTech co-owner Jiri Satanek succeeded in recording three meetings with BIS officers secretly, the paper adds.

BIS spokesman Jan Subert told MfD that the service would investigate the case.

CircleTech is developing and selling programmes for mobile phones that enable to encrypt SMS text messages and phone calls, which complicates the work of the police and secrete services.

BIS met the firm's representatives five times in various restaurants in Prague, MfD says.

BIS officers first offered to Satanek that his firm would supply an encryption system with "a defect" to the market which would help the secret service find out the content of encrypted messages.

"This is out of question. It is as if we were proclaiming we are selling bullet-proof vests that would actually not be bullet-proof," Satanek told MfD.

This is why BIS offered a deal to the firm's owners. BIS wanted CircleTech to develop a programme to decipher the codes.

It would only partially help the secret service since not even CircleTech is capable of developing a universal key to decipher all of its codes. Nevertheless, software companies are offering such partial services, and consequently it would not be a problem for CircleTech to meet the order, MfD notes.

However, BIS officers said the firm need not register the money it would receive from BIS for the order, the paper writes.

"You will have on opportunity to get an income that need not be subject to taxation," MfD cites the secret recording of a BIS officer at a meeting with the firm.

Satanek rejected the offer and recorded the meetings with BIS.

BIS then gave it up. However, two months ago it contacted Satanek again, MfD writes.

"They told me that we are allegedly meeting suspicious persons who pose a security risk to the state. In such a case we may not pass security vetting of the National Security Office (NBU)," Satanek told MfD.

He also said he would not let anyone blackmail him though he did not need security vetting. He added that the BIS officers had acted at variance with law.

Under the law, BIS is not allowed to question and detain anyone or force anyone to do things. BIS is given tasks exclusively by the government or the president and only in the law-defined areas.

Subert confirmed that BIS would investigate the case of CircleTech and if it revealed that the accusations were substantiated, the respective BIS officers would be punished.

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