China Propaganda Chief Makes Secretive Visit to Canada

Missteps with Chinese officials shows Canadian PM getting bad advice on China, says ex-secretary of state

By Matthew Little
Epoch Times Staff Created: April 26, 2012 Last Updated: October 15, 2012

Canadian Prime Minister Stephen Harper meets with Chinese Communist Party propaganda chief Li Changchun in Ottawa on April 19. (Jill Thompson/PMO)

OTTAWA—Normally when the prime minister of Canada receives a high-ranking foreign official, the visit follows a predictable protocol. There are press releases, advanced agendas, and photo ops.

When Li Changchun, the fifth-ranked member of the Chinese regime’s ruling Standing Committee, came to Ottawa last week, there was none of that. Instead, the entire visit was kept under wraps. Details of the meeting emerged only via Chinese press likely in Li’s entourage.

Even after the visit, few details were released by the Prime Minister’s Office save for a photo of Stephen Harper and his guest facing each other in armchairs.

Li is the head of the Chinese regime’s notorious propaganda and censorship system.

Bad Advice

The Canadian prime minister appears to be getting some bad advice.

Those were former member of Parliament David Kilgour’s first words when he heard Stephen Harper had met with another senior Chinese cadre who is among the most notorious rights abusers in China today.

It simply has got to stop or Canada is going to be a laughing stock among the people that believe in human dignity and rule of law.
—David Kilgour

“I am very sad to hear that. It simply has got to stop or Canada is going to be a laughing stock among the people that believe in human dignity and rule of law,” said Kilgour, a former secretary of state for Asia-Pacific.

Kilgour said the fact that Li was making the rounds in Ottawa while trying to keep his presence unknown to the Western press should have tipped off Harper’s staff that Li had something to hide.

Meetings With Top-Level Targets for Ousting

Li comes to Canada amid factional infighting in the highest ranks of the Chinese Communist Party (CCP), which is claiming some of Li’s most powerful allies.

Li has long been counted among the core members of the faction loyal to former chairman Jiang Zemin, as opposed to the faction headed by current leader Hu Jintao and his premier, Wen Jianbao.

Several top members of Jiang’s faction are now targets for ousting. It’s a messy process that has caught the attention of the international press as former Chongqing Party Secretary Bo Xilai, another Jiang ally, comes under investigation.

Canada’s Prime Minister Stephen Harper (L) and his wife Laureen wave as they disembark from their aircraft after arriving at Beijing international airport on Feb. 7. While in China, Harper met with Chongqing City’s Party Secretary Bo Xilai, a notorious rights abuser now ousted from his position and under investigation. Harper’s meeting with Chinese propaganda chief Li Changchun has raised questions over how much the PM knows about the people he is meeting with. (Ed Jones/AFP/Getty Images)

Harper met with Bo on Feb. 11, just weeks before Bo was purged from his position, a move The Epoch Times predicted before Harper’s meeting. Once considered a rising star, Bo is now under investigation for “serious discipline violations.”

“[Harper] should never have gone to see Bo in Chongqing, that was colossally bad advice. It was abundantly clear to everybody that follows China closely that Bo was on his way out,” said Kilgour.

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Kilgour also noted Bo’s leading role in the organ harvesting crimes against Falun Gong practitioners, arguing he is not someone Canada should have been looking to build ties with.

“Our PM is supposed to get better advice than that. He’s got a lot of stuff to keep track of and he’s not supposed to be an expert on all these nuances that are happening in China at breakneck speed,” said the former parliamentarian.

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Click www.ept.ms/ccp-crisis to read about the most recent developments in the ongoing power struggle within the Chinese communist regime. In this special topic, we provide readers with the necessary context to understand the situation. Get the RSS feed. Get the Timeline of Events. Who are the Major Players?

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Abrupt Terminations

Kilgour said the prime minister needs capable China advisers able to understand the situation unfolding in that country now. Otherwise, Canada will look absurd as events play out and its closest China connections continue to be cadres with careers marked by brutality and abrupt termination.

Those terminations are climbing ranks, and Epoch Times analysts are expecting Bo’s former protector and one of the regime’s most powerful figures, Zhou Yongkang, will be next to fall. Zhou heads China’s all-powerful internal security apparatus, which controls a massive surveillance network as well as China’s police and courts.

For several weeks, The Epoch Times has been pointing to evidence that Zhou is on the ropes, and recently many large media organizations have also reported that the sharks appear to be circling the communist security chief. It’s all bad news for Li, a close ally of both Bo and Zhou.

Li may have left China for a trip to four nations to escape the fallout of those struggles, said Sheng Xue, a prominent Chinese democracy activist in Toronto.

“He wants to keep his power after the struggle, so he chose to leave,” said Xue, adding that Li may actually have connections on both sides of the struggle and so left the country to avoid having to position himself.

Li has already been forced to oust his past ally Bo after his fellow eight members on the regime’s ruling Standing Committee supported purging Bo.

While Li may now wish to avoid stating allegiances, he has traditionally been associated with Jiang’s clique. According to one news report from Hong Kong’s Apple Daily, Li has already come under censure amid the fallout surrounding Bo.

Propaganda Czar Zealous in Persecutions

A spokesperson from the Prime Minister’s Office said Thursday’s sit-down with Li was a courtesy meeting, a casual chitchat with Li to exchange niceties with no formal business agenda.

Li is due to be retired from the Politburo’s Standing Committee, the nine-member organ that rules China, due on an age limit put in place by Jiang. Though Li has no official government role, his position within the Party—and the Party’s control of the government—makes him one of the most powerful people in China.

In his role as head of the Orwellian-titled Central Guidance Commission for Building Spiritual Civilization and Central Leading Group for Propaganda and Ideological Work, Li controls what 1.3 billion Chinese people see, hear, and speak.

Like Bo and Zhou, who Jiang raised from lesser positions, Li climbed through the ranks by making zealous efforts in Jiang’s campaign to crush Falun Gong. Before being banned in 1999, the spiritual group had attracted 100 million adherents pursuing spiritual enlightenment via its tenets of truthfulness, compassion, and tolerance.

As the regime’s propaganda czar, it has fallen to Li to maintain the demonization of Falun Gong necessary to justify the crackdown. Meanwhile, he must also ensure all media in China follow the Party line, regulate censorship, and carry out propaganda campaigns as needed.

In March 2008, it fell on Li to formulate propaganda to justify a violent crackdown on protests in Tibet on the eve of the 2008 Olympics.

Fear of Protests, Lawsuits Abroad

Li’s propaganda responsibilities include enhancing China’s soft power abroad.

During his trip, Li opened another Confucius Institute in Canada at Carleton University in Ottawa.

The schools have come under criticism from experts in the intelligence community for possible espionage work while others criticize the institutes for giving students a distinctly communist perspective on contemporary issues.

The institutes are a central plank in the regime’s efforts to extend its soft power.

But even that ribbon cutting ceremony was not announced. A spokesperson from the university said it was because it was a private ceremony and the public was not invited.

Lucy Zhou with the Falun Dafa Association of Canada said she suspects Li is afraid of attracting critics if his agenda is known in advance.

“I can certainly understand when officials heavily involved in persecution come overseas, they want to keep their itinerary secretive because they are afraid of protests and lawsuits,” said Zhou.

Efforts to sue Li for persecuting Falun Gong adherents were made when Li went to Ireland in 2010 and France in 2004.

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Related Articles

• Exclusive: Why Bo Xilai Fell and Xi Jinping Disappeared, Part 1
• Canadian MPs Discuss Torture in China

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Such lawsuits against Bo Xilai caused his downfall in 2007, according to U.S. diplomatic cables published by WikiLeaks.

Premier Wen Jiabao argued at the 17th National Congress that Bo, then the minister of commerce, should not be promoted to the Standing Committee because of the bevy of lawsuits against him. Bo was instead demoted to Party chief of Chongqing.

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Click www.ept.ms/ccp-crisis to read about the most recent developments in the ongoing power struggle within the Chinese communist regime. In this special topic, we provide readers with the necessary context to understand the situation. Get the RSS feed. Get the Timeline of Events. Who are the Major Players?

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Intelligence officer facing espionage charge had top-level clearance

STEVEN CHASE AND OLIVER MOORE
OTTAWA AND HALIFAX — The Globe and Mail
Last updated Thursday, Sep. 06 2012, 12:00 PM EDT

Defence Minister Peter MacKay holds a news conference at DND headquarters in Ottawa on Jan. 17, 2012. (Sean Kilpatrick/Sean Kilpatrick/The Canadian Press)

The man at the centre of an alleged espionage scandal worked in a military communications nerve centre where sources say Sub-Lieutenant Jeffrey Paul Delisle would have had top-level clearance to peruse Canada’s defence secrets.

Sources say SLt. Delisle’s most recent posting, the ultra-secure HMCS Trinity communications centre in Halifax, is surrounded by barbed wire and protected by an electronic shield that blocks unauthorized transmissions.

• Spy-obsessed Russians find little to love in Canadian espionage case
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• Intelligence officer charged with passing secrets to foreign interests

On Tuesday, the naval intelligence officer accused of spying had his bail hearing in a Halifax court delayed until next week at the request of his lawyer, who wanted more time to prepare. SLt. Delisle opted not to appear in court. “He doesn’t want to come up,” defence lawyer Cameron MacKeen told the judge, referring to the jail cells used by prisoners due in court.

What may be the biggest spy scandal in Canada in more than half a century exploded Monday after SLt. Delisle was charged with passing secrets to a “foreign entity” under Canada’s Information Security Act. It’s the first charge of its kind ever laid and one where the maximum penalty is the toughest possible under this country’s justice system: life in prison.

Details are slowly emerging about the Canadian Forces officer, despite a curtain of silence that’s been lowered by tight-lipped authorities, including the fact he declared bankruptcy in 1998.

The RCMP, Canadian military and the government refused to discuss the case but Defence Minister Peter MacKay took pains to insist the espionage allegations had not hurt the country’s relations with its foreign partners. “Let me assure you that our allies have full confidence in Canada.”

Sources say the Trinity communications centre was also privy to intelligence from Canada’s allies including the United States, Britain and Australia.

Officials at the U.S. and British embassies in Canada were not available for comment Tuesday.

Mr. MacKay on Tuesday refused to identify which country SLt. Delisle is alleged to have been spying for. “I’m not denying or confirming anything,” he said when asked to comment on news reports saying the recipient of the secrets was Russia.

“I am not going to play Clue,” he said.

A woman at Russia’s embassy in Ottawa said the embassy had no comment at this time on the Delisle story.

Sources said the Canadian government is currently conducting a damage assessment to discern how much national security has been compromised.

CTV reported Tuesday night that Canada is preparing a “measured response” to Russia that could include either summoning the Russian ambassador or expelling Russian diplomats.

However, the network said, the Harper government is leery of poisoning relations with Moscow and causing a public spat because the Prime Minister is headed to Russia later this year for a APEC summit.

Little is known about SLt. Delisle, 40, other than he most recently resided in Bedford, N.S., a suburb of Halifax, with a woman and three children.

His myspace.com page lists him as single as of 2008 and filings show a man with the same name and date of birth as the espionage suspect declared bankruptcy in Nova Scotia in February 1998 – less than two years after Jeffrey Delisle joined the Canadian Forces reserves.

It was barely a month before his 27th birthday, according to the record of the proceeding, and he owed $18,587 while declaring assets of $1,000.

He received a discharge from bankruptcy in November of 1998, filings show. The address given during the proceeding is currently assigned to a lower-level apartment at the back of a small house in Beaver Bank, a different suburb of Halifax.

Michael Hennessy, a professor of history and war studies at Royal Military College in Kingston, said the case is really unmatched in Canadian history – if the charges are proven. “For an officer and intelligence officer in particular to be involved in such behaviour is a massive betrayal of trust. It really is unprecedented.”

SLt. Delisle originally joined the Forces as a reservist in 1996 and later became an officer in 2008 after completing a bachelor of arts at Royal Military College.

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Officer pleads guilty to all charges in Navy spy case

By Alison Auld | Oct 10, 2012 10:00 am

Sub.-Lt. Jeffrey Paul Delisle covers his face with a Tom Clancy spy novel as he heads from provincial court in Halifax on Tuesday, July 17, 2012. THE CANADIAN PRESS/Andrew Vaughan

HALIFAX — A Canadian naval officer pleaded guilty to espionage Wednesday, five years after a Crown lawyer said he walked into the Russian embassy, offered up military secrets for money and began a relationship that resulted in the sharing of a “vast amount” of sensitive information.

Sub-Lt. Jeffrey Paul Delisle rose before a provincial court judge in Halifax, showing no emotion and clasping his hands together, and acknowledged that he understood the consequences of his plea to the unprecedented charges.

When asked if he confirmed the guilty pleas, the 41-year-old intelligence officer merely said, “Yes sir,” before leaving the court to return to prison as he awaits sentencing in January.

Federal Crown attorney Lyne Decarie outlined the case against Delisle during a bail hearing on March 28, saying he voluntarily approached Russian officials in 2007.

There was a publication ban on evidence and arguments presented at the proceedings in the spring, but the guilty plea means there will not be a jury trial now. Sentencing is scheduled for Jan. 10.

At the time, Decarie said in court that “following some personal problems, Delisle walked into the Russian embassy in Ottawa and offered his services. He offered to sell information to them.”

She said the officer worked at Trinity — the name for the military all-source intelligence “fusion” centre on the East Coast — which experts have said would provide tactical assessments primarily to Canadian warships and aircraft, both at home and overseas.

Decarie alleged in court that Delisle would have access to the facility’s secure and unsecured systems that contained information from Canada and her allies, and that he shared mostly military data.

But she said it also included material about organized crime, political players and the Chief of Defence phone and contact list — something she described as a “who’s who of military personnel” with email addresses and phone numbers.

The Crown gave a detailed accounting of how it said Delisle transmitted the information from the intelligence centre in downtown Halifax to his home and then on to Russian agents.

Decarie said Delisle was asked to search for Russian references in the past month on his work computer, cut and paste it onto a floppy disc, then copy it onto a USB key and take it to his home nearby.

He would then provide it to the Russians by pasting it into an email program that he shared with his foreign handler, she said.

Decarie said Delisle, a father who is divorced from his first wife, received $5,000 for the first couple transfers and then $3,000 every month.

He came to the authorities’ attention when he was returning from a trip to Brazil to meet a Russian agent in the fall of 2011, Decarie said. He was carrying several thousand dollars and had changed his hotel twice in the community where he was staying, raising the suspicions of Canada Border Services agents.

The Crown said some time after, the RCMP took over the account he shared with the Russians, allowing him to think he was transmitting material to a Russian agent when “it was actually the RCMP opening the email.”

Delisle was arrested in Halifax last Jan. 13 and charged with espionage and breach of trust, making him the first person in Canada to be convicted under the Security of Information Act.

In court at the bail hearing, Decarie read portions of a police statement where Delisle reportedly described the day he walked into the embassy as “professional suicide.”

“The day I flipped sides … from that day on, that was the end of my days as Jeff Delisle,” Decarie read from his statement.

She said he claimed to police that his betrayal “was for ideological reasons” and that he wasn’t doing it for the money.

But Decarie said Delisle went on to tell officers that the Russians had pictures of his children.

“They had all my information. They had photos of me,” Decarie read from the statement. “They had photos of my children and I knew exactly what it was for.”

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Canada needs to take threat of Chinese cyberespionage more seriously: former top spy

Colin Freeze
The Globe and Mail
Published Tuesday, Oct. 09 2012, 1:28 PM EDT
Last updated Tuesday, Oct. 09 2012, 2:24 PM EDT

 
One of Canada’s former top spies says that the damage done by economic espionage is now on par with the threat posed by al-Qaeda and other radical groups.

“It has become equal to the threat of terrorism. Why? It has such long-term repercussions. The future prosperity of Canadians,” says Ray Boisvert, who had served as the assistant director of intelligence for the Canadian Security Intelligence Service until his retirement six months ago.

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Mr. Boisvert made his remarks to The Globe and Mail after Washington released a scathing report about the cyberespionage threat posed by China’s Huawei Technologies Co.

The expanding telcom giant simply “cannot be trusted to be free of foreign state influence,” according to the U.S. House Permanent Select Committee on Intelligence.

The report suggested Huawei and the billions of dollars worth of Internet-infrastructure equipment that it sells could facilitate “the ongoing onslaught of sophisticated computer network intrusions that originate in China.”

Citing classified and unclassified intelligence, the lawmakers – versed in Washington’s own clandestine hacking efforts – recommended that Huawei be kept far away from contracts to install sensitive U.S. government systems. Their fear? Chinese spies could prevail on Huawei to install backdoors that would allow for sneak peeks at propriety data – or worse, allow them to mess with U.S. infrastructure.

Huawei remains opaque about its ongoing ties to the one-party Communist state that nurtured it. So much so that the House intelligence committee is also telling private companies to give Huawei a wide berth.

The multibillion-dollar company counters that American fears are based purely on rumour and innuendo. Yet Australia and Great Britain, too, have also taken precautions to ensure their own networks are free of prying eyes where Huawei equipment is involved.

Such arrangements now threaten to leave Canada as the odd man out in the decades-old intelligence fraternity of major English-speaking powers – the only partner that hasn’t yet publicly grappled with the significance of selling its data pipelines to a multinational often seen to be aligned with a rival power.

How significant is this Huawei issue from Canada? Here, Mr. Boisvert, who left CSIS to start a risk-management consultancy known as I-Sec Integrated Strategies, reflects on how Ottawa has been grappling with the issue.

The Globe and Mail: The U.S. seems to be very proactive about the Huawei issue.

Ray Boisvert: In this country, it’s a lot more about doing business – Canada is a trading nation, we’re small, and we need to take greater risks.

When it comes down to the U.S. polity versus ours, there’s a lot more weight placed on security requirements.

There’s a made-in-U.S.A. factor, too, that can’t be ignored. In the U.S., there are a lot of telecommunications suppliers that could supplant Huawei’s deliverables.

Well, we used to have a pretty good telecom equipment company in Canada. A lot of people suggest Huawei ate – or stole – Nortel’s lunch …

There was a bunch of stuff going on – a bunch of poor decisions were made. The Year 2000 high-tech collapse that played against Nortel.

But there have been enough stories including the head of IT [information technology] at Nortel who said that “We got done by cyber-attacks.”

And at the same time Huawei rose, Nortel fell. Coincidence? I don’t think so.

(Read more on possible cyber attacks against Nortel)

How well equipped is the Canadian government to address espionage?

At the end of the day, we’ve all been focused on the post-9/11 environment. The single most important threat has been the threat of terrorism.

That has distracted us from a very important national security threat that all of us in the business are very conscious of.

Espionage in the 21st Century is not spy-versus-spy but it’s really about gaining strategic economic advantage, globally. That means agencies facilitating the companies to gain strategic advantage to dominate economically.

In my view, it has become equal to the threat of terrorism. Why? It has such long term repercussions. The future prosperity of Canadians.

What should Canadian lawmakers think about U.S. counterparts sounding the alarm about Huawei?

It comes down to: Is our policy attuned at the right level?

There’s a two-part decision. One – Huawei, do you accept them as a legitimate player in the marketplace? If the answer to that is yes, then you are really hard-pressed not to allow them to compete for contracts in the private sector.

The second part is, are they a security threat? If they are should they be able to bid on shared [critical government] infrastructure?

It’s one thing to lay down the backbone of a really large set of pipes. If you had some malware embedded in the coding of the system, you’re fishing in a pond that’s billions and billions of litres deep.

Versus, if you’re sitting on a specific network where right away the fishing is pretty clear – you’re in a small pond of a hundred litres. It’s easier to identify which one of those data packages, which fish you want to spear.

But aren’t people getting a lot better at sifting the important stuff out of torrents and torrents of data?

There are limits.

If you’re asking me “Would you let them install hardware into the main telecommunications networks?,” my answer would be “Yeah you could, but you really want to put in a lot of checks and balances – initial verification of the code, and ongoing auditing of all of the mechanisms that Huawei would implement.”

Does this inform the Nexen Inc. takeover debate? Or are oil and telecom two different kettles of fish?

It’s not the same national-security concern. It’s one thing to look at the fact that here’s a huge investment in a strategic resource – oil – and ask “Is this in Canada’s best interest?”

But the Huawei one is very greatly debated. I think there is a preponderance of legitimate evidence, there is enough layman and specialist understanding, that an organization like Huawei could take incredible advantage of owning the network that all of your communications are crossing.

Have the security implications of Huawei been discussed in places like the Langevin Block? 24 Sussex? Your old shop at Blair and Ogilvie?

I’ll just say that I know, when I was at CSIS, these issues were raised. Whether they have an audience or not, I’ll leave that for others to comment on.

Canada has taken a look at those issues when the larger telecommunications companies [Telus, Bell, Rogers] wanted to buy Huawei equipment.

The role of CSIS is to give advice to Industry Canada.

So Industry Canada plays the middle man role – in terms of responding to concerns that industry may have [to government] or bringing those concerns the security community may have to industry.

Isn’t there always a tension between the security guys and the “Do Business” guys? Does it make any sense to put the cybersecurity issue within the “Do Business” Ministry?

There is certainly a tension. It’s a tension that an organization like CSIS is fully aware of.

This interview has been condensed and edited.

continue reading: http://www.theglobeandmail.com/news/politics/canada-needs-to-take-threat-of-chinese-cyberespionage-more-seriously-former-top-spy/article4598561/

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Another Russian diplomat leaves Canada

STEVEN CHASE
OTTAWA — The Globe and Mail
Last updated Thursday, Sep. 06 2012, 11:56 AM EDT

Russian officisalsfrom the Kremlin on down have dismissed any connection between recent diplomatic departures from Canada and the Delisle espionage case. (/Mikhail Metzel/AP)

Another Russian diplomat has left Canada in a departure that his embassy says is a routine posting change – one taking place the same month as news broke that a Canadian sailor has been charged with spying.

Dmitry Gerasimov, a consular officer with the Russian government’s office in Toronto, left in January, his embassy said Monday.

• Inside Trinity, the secretive Halifax facility where an alleged spy last worked
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• Russian defence attaché leaves embassy post

He is the second diplomat that the Russian embassy in Canada acknowledges has quit this country in January.

The other, as The Globe and Mail reported last week, was Colonel Sergey Zhukov, the defence attaché for the Russian government in Ottawa.

In both cases, the Russian embassy says the departing diplomats had merely reached the end of their assigned tenure in Canada. Col. Zhukov had worked here several years and Mr. Gerasimov, an embassy official said, had served in Canada “three or four years.”

All totalled, six Russian diplomats that have been dropped from Ottawa’s list of recognized foreign representatives in the last 11 days. It’s not clear which, if any, of recent these exits can be tied to the spy controversy.

On Jan. 16, Canadian naval intelligence officer Sub-Lieutenant Jeffrey Paul Delisle was charged under Canada’s Security of Information Act with passing government secrets to foreign interests. He faces the possibility of life in prison if convicted.

The Harper government has not publicly identified the foreign power that it believes benefitted from the alleged spying.

The Globe and Mail reported Jan. 20, however, that it had learned that more than one Russian diplomat was asked to leave Canada in connection with spy charges laid against SLt. Delisle.

The Russian government has dismissed any connection between recent diplomatic departures from Canada and the Delisle case, saying several staffers left far in advance of the sailor’s arrest.

It says the spate of six departures recently is not unusual. The number of Russian foreign representatives recognized by Ottawa has dropped to 100 from 106, according to the daily list Monday.

The embassy has never offered a clear explanation for the departure of one of the staffers – Tatiana Steklova – whose name disappeared from the Foreign Affairs list on Jan. 19.

The Canadian government has refused to discuss diplomatic fallout in the spy case.

One former senior Canadian government official, speaking on condition of anonymity, said the Harper government has avoided making a public stink about the spying in order to preserve the relationship with Russia. “Both sides are working hard to ensure the relationship over the longer term is not adversely affected,” the ex-official said.

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CSIS warns of foreign takeover risks in annual report

CSIS warns of foreign takeover risks in annual report

Report comes as shareholders approve Chinese $15B Nexen oil takeover bid

The Canadian Press
Posted: Sep 20, 2012 9:27 PM ET
Last Updated: Sep 21, 2012 12:17 AM ET

Canada’s spy agency warned Thursday that purchases, like that of the Nexen takeover by the China National Offshore Oil Co., could pose a threat to national security. (Canadian Press)

The same day shareholders of the Calgary-based energy company Nexen agreed to a takeover bid by a state firm from China, Canada’s spy agency is warning such purchases can pose a threat to national security.

In its latest annual report, the Canadian Security Intelligence Service says the majority of foreign investment in Canada is carried out in an open and transparent manner.

However, certain state-owned enterprises and private firms “with close ties to their home governments have pursued opaque agendas or received clandestine intelligence support for their pursuits here.”

The CSIS report for 2010-11, tabled in Parliament on Thursday, says that when companies with links to foreign intelligence agencies or hostile governments try to acquire control over strategic sectors of the Canadian economy, it can represent a threat to security interests.

The spy service’s report came just as shareholders of oil-and-gas company Nexen Inc. solidly voted to support the high-profile takeover by the China National Offshore Oil Co., a deal that still requires federal approval.

Foreign interference

Two years ago, CSIS director Dick Fadden made headlines by openly speaking of provincial cabinet members and municipal politicians coming under foreign influence. Though Fadden was cagey about the alleged foreign interference, he broadly suggested that China posed concerns.

While it does not name specific countries or companies, the newly released CSIS report says foreign entities involved in takeovers might try to exploit newfound control in an effort to make illegal transfers of technology “or to engage in other espionage and other foreign interference activities.”

“CSIS expects that national security concerns related to foreign investment in Canada will continue to materialize, owing to the increasingly prominent role that (state-owned enterprises) are playing in the economic strategies of some foreign governments.”

The report says CSIS continued in 2010-11 to investigate foreign interference — the attempt by governments or their agents to clandestinely influence Canadian policies and opinions, or to spy on and intimidate diaspora groups in Canada.

“Foreign interference is particularly nefarious because it can have the effect of disrupting the multicultural harmony that is central to Canadian identity,” CSIS says.

The spy service report underscores other threats to Canada, including cyberattacks, the proliferation of weapons of mass destruction and the lingering possibility of terrorist attacks in the post-9-11 era.

It notes that in January 2011 online attackers targeted the networks of the Finance Department and Treasury Board.

‘While the technological hurdles to such efforts remain significant, the possibility that a terrorist group could acquire crude capabilities of this kind cannot be discounted.’ —CSIS report

“Unfortunately attacks like this are not a rare exception. The government of Canada is now witnessing serious attempts to penetrate its networks on a daily basis.”

The main target of cyberspies is the aerospace and high-technology industry, with the oil-and-gas business and universities involved in research and development also eliciting interest, CSIS says. “From the attackers’ perspective, it is significantly cheaper and often less difficult to steal research than to develop it.”

In addition to pilfering intellectual property, state-sponsored attackers are also seeking information that would give them an advantage, such as inside knowledge of coming negotiations and the personalities involved, the report says.

“Foreign intelligence agencies use the Internet to conduct espionage operations, as this is a relatively low-cost and low-risk way to obtain classified, proprietary or other sensitive information.”

The danger of nuclear proliferation remains acute, says the spy agency, singling out the activities of Iran and North Korea as particularly worrisome.

CSIS also points out that terrorist groups have pursued the means to use biological agents or improvised radiological explosives known as “dirty bombs.”

“While the technological hurdles to such efforts remain significant, the possibility that a terrorist group could acquire crude capabilities of this kind cannot be discounted.”

© The Canadian Press, 2012

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source:

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China’s Nexen offer hard for Ottawa to refuse

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Spy case remains shrouded in secrecy

Ottawa reluctant to point fingers at Russians

May 22, 2012 – 4:10am By MURRAY BREWSTER The Canadian Press

OTTAWA — The Harper government had a host of military and possibly commercial reasons for not blaming and shaming Russia in the aftermath of an embarrassing spy scandal involving a junior intelligence officer, a series of internal briefings suggest.

The case of Sub-Lt. Jeffery Delisle, which exploded across the front pages in January, has largely disappeared into a black hole of secrecy and court-ordered silence that even a Wall Street Journal story failed to dislodge last spring.

The New York-based publication recently quoted U.S. intelligence sources saying Delisle’s breach in communications secrets was roughly as big in volume as the notorious U.S. data loss to WikiLeaks.

Yet, the Harper government has remained mute, even in the face of suggestions the case caused a major rift with Washington.

Several sources within the government and the military say there was a vigorous debate within the halls of power about whether to call out the former Cold War adversary over Delisle, whose case has been adjourned until June 13 while his lawyer awaits security-washed documents.

A small cadre of cabinet ministers, notably Defence Minister Peter MacKay, argued for a nuanced response to the crisis, which continues to have the potential to cause serious strains among allies, said the sources.

The Conservatives have previously shown no hesitation to paint Moscow as a bogey man, especially when it comes to justifying their military build-up in the Arctic.

But to alienate Russia over the alleged betrayal by a navy sub-lieutenant, potentially setting off tit-for-tat diplomatic expulsions, had more downsides than upsides, sources and briefing documents suggest.

The rivalry over Arctic boundaries, which is expected to come to a head next year with a United Nations submission, is being driven by the suggestion of mineral wealth under the melting polar sea.

The Department of Foreign Affairs and National Defence have repeatedly pointed out, in internal briefing reports, that Russian interest in the Arctic is weighted toward oil and gas exploration — something that Canada can appreciate and possibly exploit.

“Indeed, these commonalities could yield political and commercial opportunities for co-operation between Moscow and Ottawa,” said a 2011 briefing note prepared for MacKay.

continue reading: http://thechronicleherald.ca/novascotia/98831-spy-case-remains-shrouded-in-secrecy

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