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How Israeli spies penetrated Hizbollah

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How Israeli spies penetrated Hizbollah

In its 2006 war with Hizbollah, Israel tried to kill Hassan Nasrallah three times.

One air strike missed — the leader of Hizbollah had earlier left the spot. The others failed to penetrate the concrete reinforcements of his underground bunker, according to two people familiar with the attempted assassinations.

On Friday night, the Israeli military fixed those mistakes. It tracked Nasrallah to a bunker built deep below an apartment complex in south Beirut, and dropped as many as 80 bombs to make sure he was killed, according to Israeli media.

“We will reach everyone, everywhere,” bragged the pilot of the F-15i warplane that the Israeli army said dropped the lethal payload, destroying at least four residential buildings.

But the confident swagger of the Israeli military and security establishment, which has in the past few weeks delivered a steady drumbeat of devastating blows to one of its biggest regional rivals, belies an uncomfortable truth: in nearly four decades of battling Hizbollah, only recently has Israel truly turned the tide.

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Residents survey the damage after an Israeli air strike in southern Beirut © AFP/Getty Images

What changed, said current and former officials, is the depth and quality of the intelligence that Israel was able to lean on in the past two months, starting with the July 30 assassination of Fuad Shukr, one of Nasrallah’s right-hand men, as he visited a friend not far from Friday’s bombing site.

These officials described a large-scale reorientation of Israel’s intelligence-gathering efforts on Hizbollah after the surprising failure of its far more powerful military to deliver a knockout blow against the militant group in 2006, or even to eliminate its senior leadership, including Nasrallah.

For the next two decades, Israel’s sophisticated signals intelligence Unit 8200, and its military intelligence directorate, called Aman, mined vast amounts of data to map out the fast-growing militia in Israel’s “northern arena”.

Miri Eisin, a former senior intelligence officer, said that required a fundamental shift in how Israel viewed Hizbollah, a Lebanese guerrilla movement that had sapped Israel’s will and endurance in the quagmire of its 18 year-long occupation of south Lebanon. For Israel that ended in 2000 in an ignominious retreat, accompanied by a significant loss of intelligence gathering.

Instead, Eisin said, Israeli intelligence widened its aperture to view the entirety of Hizbollah, looking beyond just its military wing to its political ambitions and growing connections with Iran’s Revolutionary Guards and Nasrallah’s relationship with Syria’s President Bashar al-Assad.

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Syrians wave flags and lift a placard depicting Hassan Nasrallah, Syrian President Bashar al-Assad, Yemen’s Houthi leader Abdulmalik al-Houthi, and Iran’s Supreme Leader Ayatollah Ali Khamenei, at a rally in 2021
Syrians wave flags and lift a placard depicting Hassan Nasrallah, Syrian President Bashar al-Assad, Yemen’s Houthi leader Abdulmalik al-Houthi, and Iran’s Supreme Leader Ayatollah Ali Khamenei, at a rally in 2021 © AFP via Getty Images

“You have to define, in that sense, exactly what you’re looking for,” she said. “That’s the biggest challenge, and if done well, it allows you to look at this in all its complexity, to look at the whole picture.”

Israeli intelligence had for nearly a decade referred to Hizbollah as a “terror army”, rather than as a terrorist group “like Osama bin Laden in a cave”, she said. It was a conceptual shift that forced Israel to study Hizbollah as closely and broadly as it had the Syrian army, for instance.

As Hizbollah grew in strength, including in 2012 deploying to Syria to help Assad quell an armed uprising against his dictatorship, it gave Israel the opportunity to take its measure. What emerged was a dense “intelligence picture” — who was in charge of Hizbollah’s operations, who was getting promoted, who was corrupt, and who had just returned from an unexplained trip.

While Hizbollah’s fighters were battle hardened in Syria’s bloody war, the militant group’s forces had grown to keep pace with the drawn-out conflict. That recruitment also left them more vulnerable to Israeli spies placing agents or looking for would-be defectors. 

“Syria was the beginning of the expansion of Hizbollah,” said Randa Slim, a programme director at the Middle East Institute in Washington. “That weakened their internal control mechanisms and opened the door for infiltration on a big level.”

Mourners pray over the coffin of an assassinated Hizbollah commander in Beirut in 2008
Mourners pray over the coffin of an assassinated Hizbollah commander in Beirut in 2008 © AFP via Getty Images

The war in Syria also created a fountain of data, much of it publicly available for Israel’s spies — and their algorithms — to digest. Obituaries, in the form of the “Martyr Posters” regularly used by Hizbollah, were one of them, peppered with little nuggets of information, including which town the fighter was from, where he was killed, and his circle of friends posting the news on social media. Funerals were even more revealing, sometimes drawing senior leaders out of the shadows, even if briefly.

A former high-ranking Lebanese politician in Beirut said the penetration of Hizbollah by Israeli or US intelligence was “the price of their support for Assad”.

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“They had to reveal themselves in Syria,” he said, where the secretive group suddenly had to stay in touch and share information with the notoriously corrupt Syrian intelligence service, or with Russian intelligence services, who were regularly monitored by the Americans.

“They went from being highly disciplined and purists to someone who [when defending Assad] let in a lot more people than they should have,” said Yezid​​​​ Sayigh, a senior fellow at the Carnegie Middle East Center. “The complacency and arrogance was accompanied by a shift in its membership — they started to become flabby.”

That was a departure for a group that took pride in is ability to fend off Israel’s vaunted intelligence prowess in Lebanon. Hizbollah blew up Shin Bet’s headquarters in Tyre not once but twice in the early years of Israel’s occupation of southern Lebanon. At one point in the late 1990s, Israel realised that Hizbollah was hijacking its then-unencrypted drone broadcasts, learning about the Israel Defense Forces’ own targets and methods, according to two people familiar with the issue.

Israel’s broadened focus on Hizbollah in the region was accompanied by a growing, and eventually insurmountable technical advantage — spy satellites, sophisticated drones and cyber-hacking capabilities that turn mobile phones into listening devices.

It collects so much data that it has a dedicated group, Unit 9900, which writes algorithms that sift through terabytes of visual images to find the slightest changes, hoping to identify an improvised explosive device by a roadside, a vent over a tunnel or the sudden addition of a concrete reinforcement, hinting at a bunker.

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Once a Hizbollah operative is identified, his daily patterns of movements are fed into a vast database of information, siphoned off from devices that could include his wife’s cell phone, his smart car’s odometer, or his location. These can be identified from sources as disparate as a drone flying overhead, from a hacked CCTV camera feed that he happens to pass by and even from his voice captured on the microphone of a modern TV’s remote control, according to several Israeli officials.

Any break from that routine becomes an alert for an intelligence officer to sift through, a technique that allowed Israel to identify the mid-level commanders of the anti-tank squads of two or three fighters that have harassed IDF troops from across the border. At one point, Israel monitored the schedules of individual commanders to see if they had suddenly been recalled in anticipation of an attack, one of the officials said.

But each one of these processes required time and patience to develop. Over years, Israeli intelligence was able to populate such a vast target bank that in the first three days of its air campaign, its warplanes tried to take out at least 3,000 suspected Hizbollah targets, according to the IDF’s public statements.

“Israel had a lot of capabilities, a lot of intelligence stored waiting to be used,” said a former official. “We could have used these capabilities way longer ago during this war, but we didn’t.”

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That patience appears to have paid off for the military. For more than 10 months, Israel and Hizbollah traded cross-border fire, while Israel killed a few hundred of Hizbollah’s low-level operatives, the vast majority of them within a slowly expanding theatre of the conflict, stretching a few kilometres north of the border.

That appears to have lulled Nasrallah into thinking that the two arch-rivals were involved in a new sort of brinkmanship, with well-defined red lines that could be managed until Israel agreed a ceasefire in Gaza with Hamas, allowing Hizbollah an “off-ramp” that would allow it to agree a ceasefire with Israel.

The group had only started this round of fire with Israel on October 8, in solidarity with Iran-backed Hamas, in an attempt to keep at least some Israeli firepower pinned down on its northern border.

“Hizbollah felt obliged to take part in the fight, but at the same time limited itself severely — there was never really any intention of them taking an initiative where they might have some advantage,” said Sayigh of the Carnegie Middle East Center.

“They seem to have thrown off a few rockets here and there, and taken a few hits in return, and getting lulled into a notion that this was the limit of it — they kept one, if not both, hands tied behind their back and did nothing approaching their own full capability.”

But even the possibility that Hizbollah would attempt the same sort of cross-border raid that Hamas had successfully pulled off on October 7 — killing 1,200 people in southern Israel, and taking 250 hostages back into Gaza — was enough for Israel to evacuate the communities near its border with Lebanon. Some 60,000 Israelis were forced from their homes, turning the border into an active war zone with Hizbollah.

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To create the conditions for their return, PM Benjamin Netanyahu appears to have unleashed Israel’s more advanced offensive capabilities, according to officials briefed on the operations.

That included the unprecedented detonation of thousands of booby-trapped pagers two weeks ago, wounding thousands of Hizbollah members with the very devices that they had thought would help them avoid Israel’s surveillance.

It culminated on Friday with Nasrallah’s assassination, a feat that Netanyahu’s predecessor, Ehud Olmert, had authorised in 2006 and the IDF had failed to deliver.

In recent months, if not years, Israeli intelligence had nearly perfected a technique that allowed it to, at least intermittently, locate Nasrallah, who had been suspected of mostly been living underground in a warren of tunnels and bunkers.

In the days after October 7, Israeli warplanes took off with instructions to bomb a location where Nasrallah had been located by Israel’s intelligence directorate Aman. The raid was called off after the White House demanded Netanyahu do so, according to one of the Israeli officials.

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On Friday, Israeli intelligence appears to have pinpointed his location again — heading into what the IDF called “a command and control” bunker, apparently to a meeting that included several senior Hizbollah leaders and a senior Iranian commander of Revolutionary Guards operations.

In New York, Netanyahu was informed on the sidelines of his address at the UN General Assembly, where he rejected the notion of a ceasefire with Hizbollah and vowed to press on with Israel’s offensive. A person familiar with the events said that Netanyahu knew of the operation to kill Nasrallah before he delivered his speech.

Israel’s campaign is not over, says Netanyahu. It is still possible that Israel will send ground troops into southern Lebanon to help clear a buffer zone north of its border. Much of Hizbollah’s missile capabilities remain intact.

“Hizbollah did not disappear in the last 10 days — we’ve damaged and degraded them and they are in the stage of chaos and mourning,” said Eisin, the former senior intelligence officer. “But they still have lots of capabilities that are very threatening.”

Additional reporting by Chloe Cornish in Dubai

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BNP profits rise driven by global markets business

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BNP profits rise driven by global markets business

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Trading and investment banking buoyed third-quarter results at BNP Paribas, helping offset weakness in commercial and retail operations at the Eurozone’s biggest bank.

The Paris-listed lender reported quarterly net income of €2.87bn, 5.9 per cent higher than a year ago, and a 2.7 per cent increase in revenues to €11.9bn. Both figures were in line with analysts’ expectations.

Gains were driven by BNP’s global markets business, with a particularly sharp uptick in demand for prime brokerage services as hedge funds sought to capitalise on volatile equity markets and uncertainty around major global events such as the US election.

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Although investment banks across Europe and the US have reported strong performance in equities trading this quarter, BNP posted gains across both its equities and fixed-income trading businesses.

Revenues in BNP’s equity and prime services division were 13 per cent higher than a year ago at €820mn, while its fixed-income traders increased revenues by 12 per cent to €1.2bn.

The bank’s historic strength has been fixed income. But it is now benefiting from several years of investment in its equities business and from building up its prime brokerage offering, where it has taken over teams and clients from Deutsche Bank.

The bank also benefited from the tentative recovery in investment banking. Revenues in its global banking operations rose 5.9 per cent, driven by capital markets activity across Europe, Middle East and Africa and transaction banking in the Americas and the Asia-Pacific region.

This balanced out some weakness in commercial and retail banking which fell 2.6 per cent in the quarter — below consensus estimates from Oddo BHF — due to falling revenues from disposals of used cars at its long-term rental service Arval.

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Shares in the French bank, which is seen as a proxy for the economy, sank after President Emmanuel Macron unexpectedly dissolved parliament and called elections in June.

However, they have recovered after the July vote delivered a hung parliament and are up more than 3 per cent this year for a market value of €74bn. They trail the Stoxx 600 banking index which has gained more than 20 per cent in the same period.  

“The third quarter illustrates corporate and investment banking’s capacity to gain market share and . . . strong business momentum especially in insurance and asset management,” said chief executive Jean-Laurent Bonnafé. He added that the commercial and retail banking operation “is likely to gradually benefit from the positive shift in the rate environment”. 

BNP said it had achieved €655mn in cost savings in the first nine months of 2024 against a target of €1bn, with a further €345mn expected in the final quarter.

The bank’s common equity tier one ratio fell 30 basis points in the three months to September 30 to 12.7 per cent, but the measure of financial resilience remains well above regulatory requirements and the banks own target.

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“BNP remains very attractive in terms of risk [versus] reward as it is very diversified with a solid balance sheet,” analysts at Oddo BHF wrote ahead of the results. 

BNP affirmed its full-year guidance, including a target to increase revenues by at least 2 per cent over 2023 levels.

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US presidential election updates: Harris and Trump hit Wisconsin as data shows almost 60m Americans have voted

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US presidential election updates: Harris and Trump hit Wisconsin as data shows almost 60m Americans have voted

With less than a week to go until the 2024 election, more than 57.5 million Americans have already voted, according to the Election Lab at the University of Florida. The number represents more than a third of the total turnout for the 2020 elections – it is hard to say what it means, as 2020 saw a high number of mail-in votes because of the Covid pandemic, but turnout in some states indicates that the Republican push for supporters to vote early is working.

Dressed in an orange hi-vis vest after a campaign stunt in a garbage truck, Republican nominee Donald Trump used a rally in Green Bay, Wisconsin, to take aim at the Democrats over Joe Biden’s “garbage” comments, thanked sanitation workers and promised to protect women “whether they like it or not”.

Elsewhere in Wisconsin, Kamala Harris appealed to first-time voters, for whom she said the issues of climate change, gun control, and abortion access are “not political. This is your lived experience.” She was speaking shortly after a new CNN poll showed her six points ahead of Trump in the state.

Here’s what else happened on Wednesday:

Kamala Harris election news and updates

  • Harris spoke in Harrisburg, the Pennsylvania state capital, which is in one of the few counties that voted for Joe Biden in 2020. Polls show a tied race in Pennsylvania, which both campaigns are competing fiercely for. The path to winning 270 electoral votes is much more difficult for the candidate who loses Pennsylvania. Harris did not mention the racist remark about Puerto Rico made by a comedian at Trump’s Madison Square Garden rally on Sunday, but the state’s sizeable Latino and Puerto Rican population could be a decisive voting bloc.

  • The former Republican governor of California Arnold Schwarzenegger has announced that he is backing Harris in next week’s election. In a long post on X, Schwarzenegger, 77, said that while he doesn’t “really do endorsements”, he felt compelled to formally endorse Harris and her pick for vice-president, Tim Walz.

  • In an op-ed for the Guardian, Vermont Senator Bernie Sanders addressed progressives’ concerns about voting for Harris given the Biden administration’s stance on Israel’s war on Gaza. “I understand that there are millions of Americans who disagree with Joe Biden and Kamala Harris on the terrible war in Gaza. I am one of them,” he writes, adding that “on this issue, Donald Trump and his rightwing friends are worse.”

Donald Trump election news and updates

  • Before his Green Bay rally, refused to apologise for the comments made about Puerto Rico at his Madison Square Garden rally, instead repeating his assertion that he did not know who the comedian was or how he got booked. “He’s a comedian, what can I tell you? I know nothing about him. I don’t know why he’s there.”

  • A Pennsylvania judge on Wednesday sided with Trump’s campaign and agreed to extend an in-person voting option in suburban Philadelphia, where long lines on the final day led to complaints voters were being disfranchised by an unprepared election office.

  • The House speaker, Mike Johnson, said there would be “massive” healthcare changes if Trump wins next Tuesday, including abolishing Obamacare. “Healthcare reform’s going to be a big part of the agenda,” Johnson, speaking at a rally in Pennsylvania on Monday, told the crowd. “When I say we’re going to have a very aggressive first 100 days agenda, we got a lot of things still on the table.”

Elsewhere on the campaign trail

  • A Republican former congressional candidate was charged with stealing ballots during a test of a voting system in Madison county, Indiana, state police said on Tuesday. During the test on 3 October, which involved four voting machines and 136 candidate ballots marked for testing, officials discovered that two ballots were missing, according to the Indiana state police.

  • A majority of voters in swing states do not believe Trump will accept defeat if he loses next week’s presidential election and fear that his supporters will turn to violence in an attempt to install him in power, a new poll suggests.

  • The pace of US economic growth slowed over the summer but continued its two-year expansion, according to data released on Wednesday. US gross domestic product (GDP) – a broad measure of economic health – rose by 2.8% in the third quarter, short of economists’ expectations of 3.1%, and down from the previous quarter’s 3% reading.

  • Officials in south-west Washington were able to salvage almost 500 damaged ballots from a ballot box that was set on fire on Monday in what officials have called an attack on democracy. An unknown number of ballots were destroyed when someone placed incendiary devices in a drop box in Vancouver, Washington, while three ballots were damaged in a fire at a box in nearby Portland, Oregon. Those fires and one other are linked, officials have said.

Read more about the 2024 US election:

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Meta and Microsoft pass their quarterly sanity-check

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Meta and Microsoft pass their quarterly sanity-check

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Investing in technology companies involves weighing up expected quantities of jam today, jam tomorrow and jam at some unknown future date. Facebook parent Meta Platforms and Microsoft are serving up just enough of each.

Both reported earnings on Wednesday that — like Google parent Alphabet the previous day — outpaced what analysts expected. Microsoft’s cloud computing business increased revenue by 22 per cent, a little faster than the previous quarter. Meta’s sales of advertising increased by 19 per cent, and it exacted 11 per cent more per ad than a year earlier. Today’s jam, then, is safely taken care of.

Tomorrow is less certain. Since artificial intelligence mania took hold, quarterly earnings have become a kind of sanity check, whereby investors reassess how they feel about tech companies’ lavish investment plans. Steady share prices depend on corporate chiefs like Meta’s Mark Zuckerberg and Microsoft’s Satya Nadella walking a fine line between being bullish about AI’s potential and remaining credible about its financial returns.

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On that front, the $1.5tn-valued Meta is in the more precarious position. It has told investors to brace for “significant acceleration” in capital expenditure next year. Spending is already double what it was three years ago, weighing in at a quarter of revenue. Like Microsoft, Meta is buying chips and servers, but where Microsoft in effect rents space in its cloud to clients, Meta’s is largely for its own use.

Meta’s other challenge is that, compared with some of its peers, its boldest prospects are relatively long-tailed. That makes it different from chipmaker Nvidia, say, which sells AI-enabling silicon for real money. Microsoft already has recurring revenue from corporate customers. Facebook, meanwhile, is building new products such as social network Threads, virtual assistants and AI-generated video ads with yet-to-be determined value.

Zuckerberg has at least read the room, and is making the case that AI will bring near-term pay-offs too. More than 1mn advertisers used Meta’s generative AI tools in the past month, for example, and the company thinks those tools make users 7 per cent more likely to click. Analysts have raised their forecasts for Meta’s revenue in 2026 by $30bn over the past year, to $210bn, according to LSEG.

As for the distant-future jam — such as the recently unveiled augmented-reality holographic glasses the company describes as “the next great leap” — investors aren’t putting much weight on that at all. Meta’s share price has risen 70 per cent this year, but that still implies almost $400bn of negative value for its far-out bets, Morgan Stanley analysts believe. Big ideas can drive big valuations, but only up to a point.

john.foley@ft.com

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