Israel police hold 18 in industrial spying probe (REUTERS) By Tova Cohen TEL AVIV, ISRAEL 05/29/05 09:40 AM ET)
Reuters News Service
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TEL AVIV, May 29 (Reuters) - Israeli police investigating industrial
espionage involving leading companies have detained 18 people,
including company executives and private detectives, a police
spokesman said on Sunday.
The probe by the Tel Aviv fraud squad began several months ago and
found evidence that "Trojan horses", viruses designed to spy on
computer systems, had been planted in computers of some of the
country´s top companies, the spokesman said.
The officials the police are investigating work for firms including
Israel´s top mobile phone operator, Cellcom, and two subsidiaries of
dominant phone company Bezeq Israel Telecom (BEZQ.TA: Quote, Profile,
Research) -- mobile phone operator Pelephone and the satellite
television provider YES.
All three companies issued statements saying they were cooperating
with the police and had done nothing illegal.
A total of 18 people were detained for questioning including the
security managers at Pelephone and Cellcom, who have since been
released, and several private detectives suspected of planting the
viruses, the police spokesman said.
No charges have been brought.
The chief financial officer of YES is still being held, the spokesman
"In this manner of industrial espionage, the private detectives
gathered a great deal of information for their clients, who according
to suspicions are rival companies," the Tel Aviv police said in a
The police spokesman said two people suspected of creating the Trojan
horse, an Israeli who works abroad and his girlfriend, were being
held in London and Israel plans to request their extradition.
The Israeli police said they were collaborating with police forces
COMPANIES DENY BREAKING LAW
YES said in a statement that if the law had been broken, it was
against the company´s instructions. It said it believed the
investigation would make clear that its chief financial officer had
acted according to the law.
Pelephone said in a statement that the company and its employees were
not involved in obtaining information illegally.
"The company and its workers were surprised by the latest news and
will cooperate with police to clarify the facts of this case," the
A spokeswoman for Cellcom said the company operates within the law
and was cooperating fully with police.
Shares in Bezeq, in which the government recently sold 30 percent to
a group that included media baron Haim Saban and British private
equity firm Apax Partners, were down 2.8 percent in late afternoon
trading, compared with a modest decline on the broader market.
Among the companies infiltrated by the Trojan horse are the HOT cable
television group that competes with YES, as well as foodmaker Strauss-
Elite (STEL.TA: Quote, Profile, Research) and the Rani Rahav public
relations agency, whose clients include Partner Communications
(PTNR.O: Quote, Profile, Research) (PTNR.TA: Quote, Profile,
Research) , Israel´s second biggest mobile phone operator, police
"The Israeli police informed me that one of the suspects used a
Trojan horse in a computer," Rani Rahav told Israel Radio. "What we
have at the core is a breach of secrets of some of the country´s
Rahav also issued a statement for Strauss-Elite, another of his
clients, stating that police presented the company on Friday with
material and evidence which the firm is still examining. (© Reuters
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