Secret Intelligence Has Unusually Public Role in Ukraine War

A Ukrainian serviceman walks by an Antonov An-225 Mriya aircraft destroyed during fighting between Russian and Ukrainian forces on the Antonov airport in Hostomel, Ukraine, Saturday, April 2, 2022. (AP)
A Ukrainian serviceman walks by an Antonov An-225 Mriya aircraft destroyed during fighting between Russian and Ukrainian forces on the Antonov airport in Hostomel, Ukraine, Saturday, April 2, 2022. (AP)
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Secret Intelligence Has Unusually Public Role in Ukraine War

A Ukrainian serviceman walks by an Antonov An-225 Mriya aircraft destroyed during fighting between Russian and Ukrainian forces on the Antonov airport in Hostomel, Ukraine, Saturday, April 2, 2022. (AP)
A Ukrainian serviceman walks by an Antonov An-225 Mriya aircraft destroyed during fighting between Russian and Ukrainian forces on the Antonov airport in Hostomel, Ukraine, Saturday, April 2, 2022. (AP)

The war in Ukraine is the conflict where spies came in from the cold and took center stage.

Since Russia invaded its neighbor in late February, intelligence agencies in the US and Britain have been remarkably willing to go public with their secret intelligence assessments of what is happening on the battlefield — and inside the Kremlin.

The US this week declassified intelligence findings claiming Russian President Vladimir Putin is being misinformed about his military’s poor performance in Ukraine by advisers scared to tell him the truth. On Thursday a British spy chief said demoralized Russian troops were refusing to carry out orders and sabotaging their own equipment.

Jeremy Fleming, who heads Britain’s electronic intelligence agency GCHQ, made the comments in a public speech where he said the “pace and scale” at which secret intelligence is being released “really is unprecedented.”

Mark Galeotti, a Russia expert at University College London, agreed that the very public intelligence campaign “reflects the fact that we now live in a different age, politically and internationally. And this is a different kind of war.”

Officials say the stream of declassified intelligence — which includes regular briefings to journalists in Washington and London and daily Twitter updates from Britain’s defense ministry — has several aims. Partly it’s to let Putin know he is being watched, and to make him question what he’s being told. It’s also designed to embolden the Russian military to tell Putin the truth, and to convey to the Russian public that they have been lied to about the war.

The US and Britain also have released intelligence assessments in a bid to deter Russian actions. That was the case with recent warnings Russia might be preparing to use chemical weapons in Ukraine.

It’s all part of a closely coordinated trans-Atlantic strategy that has been in the works for months.

Biden administration officials say they decided to aggressively share intelligence and coordinate messaging with key allies, including Britain, as US concerns about Russian troop movements in autumn 2021 put the intelligence community on high alert.

In early November, President Joe Biden dispatched CIA director William Burns to Moscow to warn that the US was fully aware of Russian troop movements. The White House has typically been tight-lipped about the director’s travels, but the Biden administration calculated that in this situation they needed to advertise the visit far and wide. The US Embassy in Moscow announced that Burns had met with top Kremlin officials shortly after his trip was over.

Soon after Burns’ Moscow mission, US officials decided they needed to accelerate intelligence sharing.

Officials shared sensitive intelligence with other members of the Five Eyes alliance — Britain, Canada, Australia and New Zealand — and also with Ukraine. Director of national intelligence Avril Haines was dispatched to Brussels to brief NATO members on intelligence underlying growing American concerns that Russia seemed intent on invasion, according to a US official familiar with the matter, who spoke on condition of anonymity to discuss the sensitive issue.

Some allies and analysts were skeptical, with memories lingering of past intelligence failings, like the false claim Saddam Hussein had weapons of mass destruction that was used to justify the 2003 US-led invasion of Iraq.

Late last year, France and Germany led a group of European countries that appeared to be seeing similar military intelligence as the US and Britain, but were less convinced that an invasion of Ukraine was imminent. At NATO, Germany initially blocked the use of a system for helping Ukraine to acquire certain military equipment. France and Germany also blocked NATO from launching an early crisis planning system in response to the buildup, before relenting in December.

This week, French media reported that the head of France’s military intelligence agency, which failed to anticipate the Russian invasion, has been removed from his post.

Eric Vidaud’s departure comes amid soul-searching among France’s leadership about why it was taken by surprise by the war — which was particularly embarrassing for President Emmanuel Macron, who speaks regularly with Putin. Some see Vidaud as a scapegoat, and note that his removal comes just ahead of this month’s French presidential election.

In January, as Russia amassed troops near Ukraine’s border, Britain’s Foreign Office issued a statement alleging that Putin wanted to install a pro-Moscow regime in Ukraine. The UK said it was making the intelligence assessment public because of the “exceptional circumstances.”

Russia’s invasion on Feb. 24 largely silenced the doubters, and drew a unified response from NATO. The release of US and British intelligence is partly designed to shore up that Western unity, officials and analysts say. Both Biden and British Prime Minister Boris Johnson doubt Putin is serious about negotiating an end to the war and want to keep up the West’s military and moral support of Ukraine.

The impact inside Russia is hard to measure. The US official who spoke to the AP said the White House hopes divulging intelligence that Putin is misinformed could help prod the Russian leader to reconsider his options in Ukraine. But the publicity could also risk further isolating Putin or make him double down on his aim of restoring Russian prestige lost since the fall of the Soviet Union.

The official said Biden is in part shaped by a belief that “Putin is going to do what Putin is going to do,” regardless of international efforts to deter him.

Galeotti said Western intelligence agencies likely don’t know how much impact their efforts will have on Putin.

“But there’s no harm in giving it a try,” he said. “Because when it comes down to it, in this kind of intensely personalistic system (of government), if one line, or one particular notion, happens to get through and lodge itself in Putin’s brain, then that’s a really powerful result.”



Some European Firms Retreat from Israel-Linked Finance amid War Pressure

 An Israeli national flag flies over a city highway during rush hour, amid the ongoing conflict in Gaza between Israel and Hamas, in Tel Aviv, Israel, November 4, 2024. (Reuters)
An Israeli national flag flies over a city highway during rush hour, amid the ongoing conflict in Gaza between Israel and Hamas, in Tel Aviv, Israel, November 4, 2024. (Reuters)
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Some European Firms Retreat from Israel-Linked Finance amid War Pressure

 An Israeli national flag flies over a city highway during rush hour, amid the ongoing conflict in Gaza between Israel and Hamas, in Tel Aviv, Israel, November 4, 2024. (Reuters)
An Israeli national flag flies over a city highway during rush hour, amid the ongoing conflict in Gaza between Israel and Hamas, in Tel Aviv, Israel, November 4, 2024. (Reuters)

Several of Europe's biggest financial firms have cut back their links to Israeli companies or those with ties to the country, a Reuters analysis of filings shows, as pressure mounts from activists and governments to end the war in Gaza.

While banks and insurers are often vocal about their environmental and governance aims, they are less forthcoming about disclosing their potential exposure to war.

UniCredit put Israel on a "forbidden" list as the conflict escalated in October last year, said a source familiar with the matter, confirming a study by Dutch NGO PAX.

While in line with the Italian bank's defense-sector policy of not directly financing arms exports to any country involved in conflict, it goes beyond Italy's guidelines on arms exports to Israel.

UniCredit declined to comment on its move and the Israeli finance ministry also declined to comment.

Meanwhile, Norwegian asset manager Storebrand and French insurer AXA have sold shares of some Israeli firms, including banks.

Although corporate filings offer only a glimpse into such exposures, they show companies have been readjusting.

"We don't know whether this represents the beginning of a shift in the industry, one that recognizes the power banks have in choosing where to allocate capital, and where not," said Martin Rohner, executive director at the Global Alliance for Banking on Values, which focuses on sustainable financing.

"Investing in the production and trade of weapons is fundamentally opposed to the principles of sustainable development," Rohner added.

Israeli Finance Minister Bezalel Smotrich told a press briefing last week that although there are challenges to Israel's economy, firms are still raising money. "I sit with foreign investors and they believe in our economy," he said.

Reuters has reported that Israel's investor base has narrowed since it entered Gaza last year in response to attacks by Hamas, and it is feeling the effects of rising borrowing costs.

The potential wider effects can be seen in the approach taken by Storebrand, which a filing showed divested a holding worth about $24 million in Palantir, citing the risk of violations of international humanitarian law and human rights.

US group Palantir, which provides technology to Israel's military, did not respond to a request for comment.

Storebrand's annual investment review said that, as of the end of 2023, it had excluded 24 firms, including Israeli companies, across its portfolios in relation to the occupation of Palestinian territories.

The International Court of Justice, the United Nations' highest court, ruled in January of plausible risk of irreparable harm to Palestinian rights to be protected from genocide.

The same court said in July that Israel's occupation of Palestinian territories including the settlements is illegal.

Israel has rejected the rulings, which combined with growing pressure from activists and governments, are nevertheless having an impact on investment decisions.

AXA, one of Europe's largest insurers, British bank Barclays and German insurer Allianz have increasingly been targeted by campaigners.

"Increasing demand for greater transparency and scrutiny can only mean that financial institutions will intensify and broaden their self-assessment of their commercial associations with arms-related businesses or states," said David Kinley, professor and chair of human rights law at the Sydney law school.

The Ireland Strategic Investment Fund (ISIF) has exited six Israeli companies, selling holdings which amounted to about 3 million euros ($3.26 million), including some of Israel's largest banks, a spokesperson told Reuters.

Earlier this year, the 15-billion-euro Irish fund said that the risk profile of such investments were no longer within its investment parameters.

And Norway's $1.8 trillion wealth fund, the world's biggest, may divest shares of companies that aid Israel's operations in the occupied Palestinian territories which violate its ethics standards for businesses.

WAR EXPOSURE

Investments in Israeli banks are also under scrutiny.

The UN included them in 2020 in a list of companies with ties to settlements in the occupied Palestinian territories as part of its mission to review the implications on Palestinian rights.

A study by research firm Profundo, commissioned by corporate watchdog Ekō, shows that AXA sold almost all of its holdings in Israeli banks stocks earlier this year, retaining only a marginal stake in Bank Leumi.

Reuters verified the data with LSEG. A representative for Bank Leumi did not respond to a request for comment.

A spokesperson for AXA declined to comment on whether AXA had cut its holdings, adding that it is not invested in the banks targeted by activists. The UN list is among the criteria AXA takes into account for investment decisions, they added.

'A CLEAR LINE'

Foreign direct investment into Israel fell by 29% in 2023 to its lowest since 2016, UN Trade and Development data shows.

While UNCTAD 2024 figures are not available, credit ratings agencies have flagged the war's unpredictable impact on investment in Israel as a concern.

Although the US remains Israel's biggest military and financial backer, Spain, Ireland and Norway have recognized a Palestinian state, French President Emmanuel Macron has called for an arms export halt and Britain has suspended some licenses.

When it comes to international politics, "it should be down to the governments to take a clear line," said Richard Portes, professor of economics at London Business School, adding: "To put the burden on the private firms, where does this end?"

In an example of how activists are targeting companies directly, Barclays came under pressure from a campaign in Britain, prompting it to withdraw sponsorship from summer music festivals, while the Financial Times reported in August that it considered pulling out of an Israeli government bond sale.

Barclays said in a statement that it remained "fully committed" to its role as a primary dealer and that such activities fluctuated each quarter. The bank fell out of the top five dealers of Israeli bonds in the second and third quarters, after ranking third in 2023.