The CIA Secretly Ran One of the World’s Largest Encryption Firms for Decades

by Ryan Whitwam

For decades, Swiss firm Crypto AG supplied governments around the world with encrypted communication systems. Most of its 62 customers never suspected anything was amiss, but a new report from The Washington Post and German broadcaster ZDF reveals that Crypto AG was actually owned by the CIA and West German intelligence (BND). For decades, the agencies effortlessly eavesdropped on the secure communications of allies and enemies alike.

Crypto AG didn’t start as a CIA operation — it was the brainchild of Russian-born inventor Boris Hagelin. Hagelin fled to Sweden when the Bolsheviks took power in Russia and then fled again to the US when the Nazis swept into Sweden. While in the US, he helped develop the M-209 encryption machine for US forces. After the war, Hagelin returned to Europe to reestablish Crypto AG in Switzerland. There, he developed more advanced versions of the pin-and-lug type encryption he used in the M-209.

According to the classified CIA documents obtained by The Post and ZDF, the CIA became concerned that Hagelin’s machines would allow other nations to completely obscure their communications, so it developed a plan to “deny” that technology to them. Knowing Hagelin held a great fondness for the US, intelligence officials approached…