The undercover op BEFORE Toronto: NewsCorp/NDS adventures in Europe

You’re running a NewsCorp/NDS anti-piracy operation that involves helping hackers to pirate a competitor’s product to win their trust—so when do you need to tell your competitor what you’re doing?

In the Toronto incident in October 1997, NDS’s Ray Adams and Oliver Kömmerling ran into trouble on an undercover mission in Canada when they failed to tell their client DirecTV what they were doing. DirecTV heard that Oliver was programming pirate DirecTV cards informed the Royal Canadian Mounted Police and the FBI. Oliver had to be smuggled across the border into the US and then to Europe.

But just a month previously, Adams had written to NDS Operational Security chief Reuven Hasak, about another plan involved the rival Irdeto smartcard (See exhibit TEX0189 attached).

The hacker codenamed ILIAN was working on the “Irdetto” [sic] digital system but lacked the cards and chips to put his pirate program on.

Adams’ plan was to provide Ilian with the cards he needed.

“I can buy them through an agent for about $11,” Adams wrote. “This is a pretty good price. I am even get them cheaper. Having say 1000 chips would make ILIAN come running to Alex. Ilain says that once the Irdetto hack is launched he will concentrate on all other European systems. He included SKY in his list of about six. So we must concentrate on this guy.”

It reads like a standard anti-piracy operation. Except that Adams and NDS was proposing to provide material to make 1000 pirate cards, which might be sold for $300,000, and which might cost a European pay-tv operator using Irdeto perhaps $1 million.

There was no indication that this was a joint operation. Adams didn’t say that he was going to tell the pay-tv operator that he was helping someone pirate their system. Adams would say this is an anti-piracy operation. But it raises the question in whose interest it was, and who would pay the cost of what he proposed to do.

This was a month before the Toronto incident.

This is not to say any of this is necessarily wrong or even inappropriate. Only some of the facts are available. However it does raise questions about the nature of NDS’s operations.

Ray Adams also appears to refer to Boris F, the Berlin hacker: “BF has not answered his phone for the past two days. His mother says he is working at university. I try every few hours. Plan is to see him next Tuesday with Chaim.”

Reuven Hasak (see attachment) was questioned about the Adams report of September 26 1997 (Exhibit TEX0189) during the 2008 EchoStar trial. He was dismissive of Adams and his reports which he described as “blah, blah, blah”, and “with capital letters”, to the amusement of the court.

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