Deutsche Telekom Secretly Tracked Phone Calls of Executives, Journalists (Update)

. Wednesday, May 28, 2008

Images of Stasi-era wiretaps and spying fell over German phone company Deutsche Telekom AG (DT) earlier this week, after the company admitted Monday to hiring a consultancy firm to spy on the telephone records of prominent company executives and business journalists.

The admission came just days after a report published by German-language weekly magazine Der Spiegel, sourced from procured copies of a fax sent to Telekom late last April. The fax urgently requested Telekom lawyers to contact the management firm’s leader, who wanted to conduct a “controlled termination” of the companies’ business relationship – allegedly due to Telekom’s nonpayment of their invoices. The unnamed consultancy leader laced the fax with threats, including one warning for Telekom attorneys to “not underestimate my aggressive potential and my staying power.”

Deutsche Telekom said its spying program, which it codenamed “Clipper” and “Rheingold,” was carried out between 2005 and November 2006, with the purpose of identifying the source of the frequent leaks that plagued company decision-making. Telekom CEO Rene Obermann, who was installed after the spying allegedly took place, pledged a full investigation into the program.

“I am completely shocked by the allegations,” said Obermann. “We have involved the state prosecutors and will support them in their efforts to conduct a thorough investigation.”

The company says it did not spy on contents of the calls themselves, but rather mined connection data for interesting links between company executives and journalists. The project’s purpose, according to Der Spiegel’s April fax, was to “analyze several hundred thousand landline and mobile connection data sets of key German journalists reporting on Telekom and their private contacts,” including “several supervisory board members on the employee side.” Other spying programs were in the works, including one against an unnamed New York-based Telekom shareholder, which the Spiegel thinks is likely to be management firm Blackstone Group.

Telekom’s scandal is merely one of the latest privacy scandals to rock Germany, which is still recovering from the pervasive levels of surveillance conducted by East Germany secret police up until its dissolution 1989. In the United States, The New York Times compared the Telekom’s spying program to that of the 2006 pretexting scandal against Hewlett-Packard, which at one point included criminal charges filed against a number of company executives. That investigation officially concluded in May 2007.

Obermann reassured customers and stockholders, telling German-language newspaper Bild that “the data of our millions of mobile and fixed line customers are safe.”

Peter Schaar, who serves as the German Federal Commissioner for Data Protection, noted that Telekom now has to notify everyone affected by the spying operation.

“The case must be fully investigated and consequences need to be drawn,” he said.


P.S: Deutsche Telekom is parent company of US Cellular Provider T-Mobile .....
Prosecutors Don't Have Proof Deutsche Telekom Viewed Bank Data