'THE NATION'
PAUL BUCHANAN
Interviewed by RACHEL SMALLEY

Security expert, Paul Buchanan, is calling for greater oversight and accountability of New Zealand’s intelligence agencies.

Speaking on TV3’s The Nation this weekend, Mr Buchanan said the GCSB's assurances that Huawei posed no threat to national security was another example of its incompetency.

“If you were to ask me a month ago if I would take the GCSB's word at face value I would have said, absolutely... But given revelations over the past month of some playing loose with the rules... there may be some political commonsense that is lacking in seeing obvious threats.”

Huawei is helping to build New Zealand's new ultra-fast Broadband network.

This week a US congressional committee warned that the Chinese government is a silent partner in the ICT company and could use it for spying on other countries.
Mr Buchanan said New Zealand would be a target for Chinese spies.

“We have become... first tier military and intelligence partners with the United States. That is bound to attract the interests of US adversaries.

"We're not as independent as we claim to be.”

Mr Buchanan said the Prime Minister should not be the only individual responsible for overseeing the GCSB and SIS.

“If the Prime Minister is very hands on, that raises the possibility of political manipulation of intelligence. If the Prime Minister is very hands off, that allows his agencies to play loose with the rules as we may have just seen. So I think that we need to think about the oversight.

“It appears that the Inspector General is more of a façade than a truly independent investigator of the activities of the agencies that he's charged to oversee.”

Mr Buchanan also claimed New Zealand’s Intelligence and Security Committee was a “toothless wonder”.

“They don’t even meet once a month, they're not allowed to learn anything about operational details.

“Triangulation is the name of the game... You need at least three independent verifiers of what intelligence agencies are doing, and we don’t have that here.”

Rachel This week the US launched a fresh attack on Chinese telecommunication companies. A congressional committee issued a warning to companies in the US saying Huawei and ZTE may be a front for Chinese spying, and they shouldn’t be trusted. But here in New Zealand Huawei is expanding. The company's hiring more staff as part of its contract to help build our ultra-fast Broadband network. The government is following the advice of our intelligence agency the GCSB which has allayed any security fears about Huawei. But an Intelligence Analyst, Paul Buchanan, says we should be worried.

Paul Buchanan is a former Policy Analyst and Intelligence Consultant to the US government security agencies. He's now the Director of 36th Parallel Assessments. He joins us now, good morning Paul,

So the government seems to think that we have nothing to fear really. Are we right to accept the government's judgement on this?

Paul Buchanan – Intelligence Expert
Well I think we have to because the contract's already been let. I guess what we should understand when it comes particularly to cyber espionage is the bigger the market the more cable has to be laid. The more the cable is laid the easier it is to put what are known as back door bugs into the cable. On the other hand the massive amounts of data make it hard for those putting in the bugs to target specific entities. Just the mass amount of data. In a smaller market such as New Zealand it is much easier for the security services to locate bugs. But on the other hand for those who may wish to put in the bugs it's easier for them to target individuals. Because let's be frank, the decision making community in New Zealand, both political and corporate is a relatively small number of people, and so it is very possible that a foreign entity may try to use the Broadband infrastructure for espionage purposes. But I guess the good news is the GCSB would have an easier time of locating those bugs, and if Mr Joyce is correct and they’ve already ensured one way or another then those bugs won’t be there in the first place.

Rachel Do you think Huawei is tied in with the Chinese government?

Paul Yes I believe so. I think that the Chinese government is a silent partner in Huawei, despite the protestations that it's a private company, and the reason I say that is because the Chinese have 12 strategic industries that the State is very very much involved with, and very concerned with. One of them is telecommunications. It's part of Chinese power expansion, and given the fact that the Chinese regime does not have an independent judiciary, does not have an independent legislature, that means that in the areas where it has a strategic interest the Chinese Communist Party makes the calls as to how to apply those interests, or how to promote those interests in the global arena. So it doesn’t necessarily mean that Huawei is evil because let's face it there are a lot of state capital assistants in which the regime is involved, with strategic sectors, particularly the Americans. But not only the Americans seem to think there are three problems with Huawei. It's that relationship with the regime. They play loose with market rules. There have been accusations that we saw in the report of bribery and corruption, intellectual property theft, violations of copyright. So they're not good corporate actors in the minds of at least some American law makers. And then of course there are national security issues.

Rachel Our government says though that it's got systems in place that will make them play by the rules. So in theory that corruption and what have you wouldn’t be an issue for New Zealand. That’s their argument.

Paul Well maybe it's because it is a small market, but let's be very clear on this. Our major intelligence partners, particularly the Australians and the United States, and from what I understand the Canadians are about to ban Huawei from getting involved.

Rachel They're considering it yes.

Paul We're running against the flow if you will.

Rachel That’s okay though, New Zealand sometimes does that.

Paul We're not as independent as we claim to be.

Rachel Let's suggest for a moment that Huawei is doing this and there is some illegal capturing of data from New Zealand. What data are they interested in, what would they want from s?

Paul Well again let's remember that the overlap between government computers, private computers, in a very small market like New Zealand is more extensive than in a much bigger market. They would be interested obviously in corporate espionage. Again assuming that they play loose. You know they would like to know investment strategies of New Zealand firms in China. I mean if you can get a heads up on what a potential trade partner is thinking prior to entering into a negotiation, that gives you some leverage. So they would do that and then let us remember, even though it would not be a direct approach to the Echelon Five Eyes network, it is very possible given the limited number of people involved in intelligence decision making and the like, that they could be targeted in their personal lives, so as to find a back door into the intelligence network. Let's face it if you can get into someone's personal computer and you can get their email lists and what have you, I would just say that operational security in New Zealand, particularly amongst the political class has been less than optimal. We see leaks, we see all sorts of things going on, and if you're specifically targeting someone that you know has an important decision making role, be it in intelligence, be it in defence, New Zealand is a place where you could very probably start to mine the data from that person.

Rachel Okay so you’ve been involved with the Pentagon and various American agencies. We've got a pretty good relationship with China. We've got a warming relationship with America. How would America view it do you think if we carry on, which it looks like we're going to, with Huawei as a key player in New Zealand, what would that make perhaps the Pentagon do, do you think?

Paul I don’t think they're gonna be very happy, and I don’t think, it won’t be so much the Pentagon because they receive intelligence from the National Security Agency. The National Security Agency are the people that are charged with countering cyber espionage. Let's just look at it this way. The reason I say that New Zealand is not as independent as we may wish to think, is that we have become with the Wellington and Washington agreements, first tier military and intelligence partners are the United States. That is bound to attract the interests of US adversaries. Might be China, might be Russia. But now that will attract their interest because we are part of that Five Eyes. I mean we are a very unique small country in that on intelligence matters of a signals intelligence and technical intelligence sort, we play with the big boys. And I would argue we're probably the most vulnerable of all of those countries involved in Echelon, and so now we will attract the interest of US adversaries because we're on the front line with the Americans and I don’t find it – I really don’t think it's gonna be tenable over the long term, to try to trade preferentially with the Chinese, and try to be first tier security partners with the United States, given the emergent strategic competition between China and the United States, and given the fact that both China and the United States consider economic espionage to be a national security issue.

Rachel Okay, but saying all this the GCSB has clearly looked at the security threat that’s posed to New Zealand and seems to think that we have the technology in place to protect ourselves. We can tell if someone is spying on us, and you’ve suggested that might be the case, because we're a small network here.

Paul Yes, I think that we do have advantages because of the small size. If you were to ask me a month ago if I would take the GCSB's word at face value I would have said absolutely. You know they're clearly experts in this field. But given revelations over the past month of some playing loose with the rules on the part of the GCSB, when it comes to electronic espionage I think you know it may not be so much their expertise that is lacking, but there may be some political commonsense that is lacking in seeing obvious threats, but discounting them because of the interest in trade, the interest in trying to straddle the fence between these two great powers. And again I do not think that is tenable over the long term

Rachel At the moment our security strategy is essentially overseen by the Prime Minister and Paul Neazor, the Inspector General of Intelligence. Is that the right strategy, those two…?

Paul No. To be honest with you I think that we need a reform of the oversight and accountability mechanisms governing New Zealand intelligence. The latest discussions about the GCSB follow on the heels of a series of untoward advance involving he SIS, now the GCSB, and we have one individual as the oversight on both of these agencies, and they are very important agencies. That individual is the Prime Minister. If the Prime Minister is very hands on that raises the possibility of political manipulation of intelligence. If the Prime Minister is very hands off that allows his agencies to play loose with the rules as we may have just seen. So I think that we need to think about the oversight. The Inspector General has to be a retired High Court Justice. That means that it's an elderly person, very under resourced. They have the equivalent of a .5 personnel, and they depend on the SIS for all their resources. Their charter is extremely circumscribed. So to be honest with you to me it appears that the IG is more of a façade than a truly independent investigator of the activities of the agencies that he's charged to oversee. So I think that this is the time given, and we've had now a public discussion about these agencies for parliament to rethink its role in this because the Parliament Committee on Security Intelligence is – I'd hate to say it – but a toothless wonder. You know they don’t even meet once a month, they're not allowed to learn anything about operational details. Triangulation is the name of the game. You not only need triangulation in intelligence sources, but you need at least three independent verifiers of what intelligence agencies are doing, and we don’t have that here.

Rachel Alright we have to leave it there, Paul Buchanan very much appreciate your time this morning. Thank you.

ENDS

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