Israel takes pride in its high-tech industry — and it brings in big bucks. But one of its star cybersecurity firms, NSO Group, is at the center of a spying scandal, and the government plays a role.



Israel takes enormous pride in its high-tech industry. But one of its star cybersecurity companies, NSO Group, is the focus of an international scandal. Investigative reports have found NSO software is sought by governments around the world to spy on human rights activists, journalists, even heads of state. NPR's Daniel Estrin reports from Jerusalem on how Israelis are grappling with the revelations and the question of who's responsible.


SHALEV HULIO: (Speaking Hebrew).

ILANA DAYAN: (Speaking Hebrew).

DANIEL ESTRIN, BYLINE: On Israeli Army radio, an investigative journalist grilled the head of NSO Group about Pegasus, the company's cellphone-hacking software. It gains access to phones without the owner even knowing.


HULIO: (Speaking Hebrew).

DAYAN: (Speaking Hebrew).

ESTRIN: Journalist Ilana Dayan asks, "you didn't know about the software's very wide use against dozens of journalists and dozens of countries? You didn't know that your software was installed on the phone of the fiancee of Saudi journalist Jamal Khashoggi?"


DAYAN: (Speaking Hebrew).

ESTRIN: "All that you didn't know?"


HULIO: (Speaking Hebrew).

ESTRIN: NSO head Shalev Hulio says the software saves lives and that the company only sells to governments to catch terrorists and criminals. He called the allegations a campaign to tarnish the entire Israeli cyber industry and the state of Israel itself. NSO has faced global controversy before, but now it's on the defensive at home.


YIGAL UNNA: I'm proud to introduce to you the prime minister of Israel, Naftali Bennett.

ESTRIN: At a cybersecurity conference in Tel Aviv last month, Bennett made no mention of the controversy.


PRIME MINISTER NAFTALI BENNETT: (Speaking Hebrew), and good morning.

ESTRIN: Instead, he explained why his tiny nation stands out in the global cybersecurity industry.


BENNETT: What we've got in Israel is a bunch of really smart people who at a very young age enter the military, could be in combat units or cyber units. But ultimately, they're thrown into the Israeli society with huge capabilities. And that's why we're seeing the high-tech boom.

ESTRIN: NSO, the initials of its three founders, was created in the shadows in 2010. Israeli journalist Shay Aspril was the first to report about them in 2012. He recently published an award-winning novel in Hebrew about the dubious ethics of some Israeli high-tech, which he says Israelis don't talk about much.

SHAY ASPRIL: One has to understand that the defense industry and the high-tech industry are the two sacred cows of the Israeli economy. The Israeli public perceives those industries as bold, creative, profitable - qualities which most people in general tend to appreciate.

ESTRIN: But Israelis are taking note of global outrage. France, for example, is furious because President Emmanuel Macron's cellphone number reportedly appears on a list of people Morocco sought to target with NSO's spyware. The company told NPR it's now suspended some governments' access to its products. The question is whom to blame for the spying. NSO lawyer Shmuel Sunray spoke with NPR.

SHMUEL SUNRAY: The ultimate responsibility is on the one who actually conducts the abuse.

ESTRIN: He says the company has no control over how the software is used, but in recent years has chosen its customers more carefully and looked into alleged wrongdoing.

SUNRAY: If there is a serious abuse of human rights, a targeting of a journalist for - just for him per se being a journalist, we would just shut down the system. And we have done so five times in the past.

ESTRIN: The Israeli government plays a central role here. It vets NSO's exports because they're considered cyberweapons. Israel reportedly approved NSO sales to authoritarian governments like Hungary, Saudi Arabia and the United Arab Emirates, which Israel was courting for closer ties. Tehilla Shwartz Altshuler of the Israel Democracy Institute.

TEHILLA SHWARTZ ALTSHULER: NSO commercial interests and Israel's security and international interests were kind of blurred together. What's bothering me is the fact that all this has been done very far from the public eye of the Israeli public.

ESTRIN: Cyberspying isn't just an Israeli phenomenon. David Kaye, former U.N. Special Rapporteur on freedom of expression, says democracies need to help lay out global rules for regulating cyber surveillance.

DAVID KAYE: It's possible that Israel could be part of the solution to the global problem of the spread of spyware, but because of its integration into government already, it may make it harder for Israel to move forward on this.

ESTRIN: But the tech industry is acting. Amazon Web Services says it's shut down NSO accounts. WhatsApp is suing the company for allegedly using the messaging app to infiltrate cell phones. Israeli cybersecurity veteran Iftach Ian Amit has called on tech companies not to hire former employees of companies like NSO.

IFTACH IAN AMIT: I am 100% certain that they do have legitimate customers, that they do have work that ends up with putting the right people behind bars and finding them. But I think that there's been a tipping point where greed kind of took over, and it was just unscrupulous. You're doing more harm, I think, than good.

ESTRIN: Israeli defense officials say they're investigating NSO exports. A parliamentary committee says it's considering tighter export controls. These reviews are all happening behind closed doors, even as the global spread of Israeli spy technology is no longer so secret.

Daniel Estrin, NPR News, Jerusalem. Transcript provided by NPR, Copyright NPR.