Inside Canadian Intelligence
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Inside Canadian Intelligence

Exposing the New Realities of Espionage and International Terrorism, 2nd Edition

Dwight Hamilton

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Inside Canadian Intelligence

Exposing the New Realities of Espionage and International Terrorism, 2nd Edition

Dwight Hamilton

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About This Book

Since 9/11, Canada has been on the front lines of a New World Order that few understand. And in today's world, secret intelligence is not just the first line of defence – it may be the only one. Editor Dwight Hamilton has assembled a formidable cast of former intelligence officers and journalists to take you inside the covert and dangerous world of espionage and international terrorism. This revised paperback edition provides a concise expos of every government organization in the Canadian national security sector. With first-hand accounts and informed analysis, the team behind Inside Canadian Intelligence has the esoteric expertise to accurately portray the new realities like no one else can. Forget James Bond: this is the real thing.

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Chapter 1

KNOW YOUR ENEMY
by Dwight Hamilton
“The fifth most important Christian country to be targeted.”
As an intelligence operative I had to read a lot of disturbing documents in my day, but none were as alarming as an al Qaeda Jihad training manual, which I recently obtained years after leaving the section at headquarters. And since the first rule I was taught by my superiors was to “know your enemy,” the document is worth quoting at length here. Declaration of Jihad Against the Country’s Tyrants, which when translated from the original Arabic runs nearly two hundred pages, will give you an idea of what the Western security services are up against in the War on Terror.
Given the document’s strong religious overtones, it should be pointed out that its authors’ views and prescriptions in no way represent those of the vast majority of Muslims. But Islam has very violent roots, and its initial spread in the seventh to tenth centuries was entirely through conquest. This surge eventually subsided until the eighteenth century Wahhabi revival on the Arabian Peninsula harkened back to this violent legacy.
Islam is an innately conservative social religion, and many of its societies have had considerable difficulty in adjusting to the modern world, despite the oil wealth of the Persian Gulf. In the 1970s, wealthy Saudi Wahhabists funded a militant revival that, combined with the Islamic revolution inside Iran and the Soviet invasion of Afghanistan, generated a potent Jihad (or Holy War) movement. The Jihadists have destabilized several Islamic countries, ignited many regional conflicts, and launched significant terrorist attacks against the West.
But to the authors of this version of the Jihad manual, the watershed event that defines their cause occurred on March 3, 1924, when they feel a godless West imposed itself upon Islam. Shortly before, the Grand National Assembly of Turkey had declared that country a republic and Mustafa Kemal was elected as its first president, thus bringing the Ottoman Empire to a close. On March 3 the Khalifate (an Islamic natural state wherein religious principles dictate its organization and behaviour) was abolished in Turkey and the ruling Ottoman family was deported. Sharia law offices were closed and religious education was banned from the public school system. The manual states that in the republican aftermath the new rulers “aimed at producing a wasted generation that pursued everything that is Western.” But “young men who were raised by [the new rulers] woke up from their sleep and returned to Allah, regretting and repenting.”
The text indicates that the Jihadists are prepared to rectify with violence what they consider to be a major historical injustice that was brought upon them. This is one of the hallmarks of a new type of terrorism. In the past, terrorist groups that targeted the West were seeking revolutionary change exclusively, but with Islamic extremists retribution is as equally important. Their actions are designed to punish target nations without distinction between their political, military, and economic sectors and without worrying about the effects on their civilian populations.
The manual reads:
These young men realized that an Islamic government would never be established except by the bomb and rifle. Islam does not coincide or make a truce with unbelief, but rather confronts it. The confrontation that Islam calls for with these godless and apostate regimes does not know Socratic debates, Platonic ideals nor Aristotelian diplomacy. But it knows the dialogue of bullets, the ideals of assassination, bombing and destruction, and the diplomacy of the cannon and machine gun.
The young came to prepare themselves for Jihad commanded by the majestic Allah’s order in the holy Koran. Islamic governments have never and will never be established through peaceful solutions and cooperative councils. They are established as they always have been: by pen and gun; by word and bullet; by tongue and teeth. The main mission for which the military organization is responsible for is the overthrow of the godless regimes and their replacement with an Islamic regime.
These opening pages raise a few points. Contrary to what some have suggested, the threat posed by al Qaeda and its affiliates will not evaporate with a few regional political changes, such as the creation of a new Palestine peacefully co-existing with Israel or the removal of American influence from Saudi Arabia. The Jihadists are aiming for a worldwide Khalifate. “Operations against enemy individuals” are considered short-term goals; the establishment of an Islamic state is the ultimate one. It is fitting that the manual’s cover emblem shows a sword cutting through the globe.
Other factors that distinguish the Jihadists from older terrorist groups include their lack of regard for bad press in the world’s media and a similar disregard for the fact that their sponsor states (such as Afghanistan under the Taliban) will suffer from the West’s reprisals. While power vacuums like Somalia are still valuable to terrorists, al Qaeda is truly a global entity, and national support is not as crucial as it once was.
In addition, there is no room for negotiation in their Holy War. In the past, ideologies of terrorist groups that opposed the West were political, which usually meant they were either Communist or Fascist. But they never matched the suicidal zeal of al Qaeda. Communists are atheists and don’t expect thirty virgins upon their arrival at the Pearly Gates. “It is necessary that all Adam’s children obey,” the manual states. It doesn’t matter that not all of Adam’s children bow toward Mecca. Al Qaeda’s message is convert or die.
Turning to practical matters, the manual’s first lesson outlines eight tasks for Islamic Jihadists:
  1. gathering information about the enemy, the land, the installations, and the neighbours;
  2. kidnapping enemy personnel, documents, secrets, and arms;
  3. assassinating enemy personnel as well as foreign tourists;
  4. freeing the brothers who are captured by the enemy;
  5. spreading rumours and writing statements that instigate people against the enemy;
  6. blasting and destroying the places of amusement, immorality, and sin; not a vital target;
  7. blasting and destroying the embassies and attacking vital economic centres; and
  8. blasting and destroying bridges leading into and out of the cities.
In addition to lessons on using small arms and explosives, the manual features detailed instructions on using counterfeit currency and forged documents to infiltrate target nations. Also covered are secret writing, ciphers and codes, kidnapping and assassination techniques, and guidelines for beating and killing hostages. Not much is missed; examples in espionage are given from Roman times to the present. Attention is given to finding secure apartments and hiding places in target nations as well as employing means of transportation and clandestine methods of communication. Recipes for complex poisons like ricin and abrin are given along with a simply made, toxic vegetable soup based on a bowel movement.
What characteristics should someone have to carry out al Qaeda’s work? Patience and discipline are paramount for a Jihadist, as well as a bizarre peace of mind. “The member should have a calm personality that allows him to endure psychological traumas such as those involving bloodshed, murder, arrest, imprisonment and reverse psychological traumas such as killing one or all of his organization’s comrades,” the manual’s authors write. Perhaps the Jihadists would label someone who can murder their own comrades as calm, but mental health professionals would call it psychotic.
Psychological operations or “hearts and minds” campaigns have been a vital part of warfare for ages. As the Nazis’ minister of propaganda, Goebbels elevated it to a fine art. With the Jihadists, their campaign of terror fulfills ten PsyOps objectives outlined in the manual:
  • Boosting Islamic morale and lowering that of the Enemy
  • Preparing and training new members for future tasks
  • [Inflicting on the West] a form of necessary punishment
  • Mocking the regime’s admiration among the population
  • Removing the personalities that stand in the way of the Da’wa [Islamic call]
  • Agitating [the population] regarding publicized matters
  • Rejecting compliance with, and submission to, the regime’s practices
  • Giving legitimacy to the Jama’a [Islamic group]
  • Spreading fear and terror through the regime’s ranks
  • Bringing new members to the Organization’s ranks
But is all of this just fear mongering? There is a prevailing feeling among a complacent Canadian public that “it can’t happen here.” In security circles it is known as the “peaceable kingdom” theory. According to one survey conducted a year after 9/11, an alarming 77 percent of Canadians think a terrorist attack could not occur here. While that is a comforting thought, it is also false — spies are everywhere, including right next door. Here is a case that, for me anyway, hit too close to home.
In the summer of 1994 I had just moved into an apartment in Toronto on the south side of Roehampton Avenue, a couple of blocks east of Yonge Street. When she wasn’t appearing in the television series Road to Avonlea, actress Sarah Polley also lived there at the time.
That October I got more new neighbours who would appear on television, although not in a series as wholesome as one about a little girl from Prince Edward Island. Just a few buildings to the west on the same side of the street, Ian and Laurie Lambert moved in. Ian would later attend the same classes at the same college of the same university I had. To top it off, we even had adjacent room numbers in our respective buildings: 601 and 602.
The only trouble with my new neighbours was that Ian and Laurie were actually Dmitry Olshevsky and Yelena Olshevskaya of the Russian Foreign Intelligence Service (SVR), which replaced the KGB after the collapse of the Soviet Union.
It was like a classic KGB Directorate S operation: the Lamberts were “sleepers,” covert agents who can wait for years before beginning their espionage activities. The couple received short-wave radio messages from SVR headquarters in Moscow as well as from a Line N officer working under Russian diplomatic cover in Ottawa. After a lengthy CSIS investigation code-named Operation Stanley Cup, the Royal Canadian Mounted Police (RCMP) eventually arrested the pair on May 22, 1996. Afterward, the incident received widespread attention in newspapers, on television, and even in a book.
If it weren’t for that publicity, however, I would have never known a thing. So if Russian spies can sleep on my street, then al Qaeda operatives certainly can too. The manual emphasizes learning Western customs: agents are to gather information from the open media and pay special attention to the opinions, comments, and jokes of common people to assimilate. Traditional male Muslim traits such as wearing beards, chewing toothpicks, and wearing long shirts with little Korans in their pockets are also discouraged in operational zones.
The Lambert case also illustrates the second major threat facing Canada’s national security today: the theft of high technology through economic or corporate intelligence. Keep in mind that the Cold War had already ended by the time the “Centre” in Moscow made the decision to embark on a very risky, costly, and time-consuming “illegal resident” caper in Canada. But to the Russians, it was worth it. We are one of the most technologically advanced countries in the world. Russia, despite its espionage efforts, is still many years behind. But with folks like the Lamberts working for you, it’s possible to catch up much more quickly.
International terrorists have been playing catch-up in the last decade too. Some scholars have dubbed the new threat “high/low terrorism.” Attacks produce extremely high casualties from the relatively low technology used and the low cost involved in mounting operations. The idea is not that new, however — the first classified briefing I attended raised the possibility of weapons of mass destruction falling into the hands of terrorists. But today their use is imminent. “The spectre of nuclear or bio-terrorism brings to the fore major destruction of urban infrastructure and loss of life. Such a threat envisages much more devastation in life and property than most terrorist attacks have effected to date with the exception of 9/11,” says retired intelligence officer David Rubin, QC. “Unfortunately, the cost of nuclear and bio-weapons is dramatically falling leaving non-state actors with potential access to them, and thereby fundamentally altering military strategy from that of state to state conflict to that of state to non-state. Nuclear or bio-weapon terrorism poses a much greater threat to civilization than the traditional terrorism carried out to date,” he adds. “Democracies must devote the maximum effort to control the markets and availability of such weapons to terrorist groups. Even more so, we must develop a military strategy, in conjunction with a political and economic strategy, to minimize any local popular support toward them.”
This is truly a time when war is on our doorstep. “We have incredibly close business relations with the United States, are territorially adjacent, and in the final analysis we are a democratic nation with values that are anathema to many of these groups of terrorists,” Rubin says.
It is the economic aspect that may be the most important. How many shocks like 9/11 can the United States withstand without collapsing? It’s estimated that the direct cost of that strike was about $40 billion and caused a 3 percent drop in GDP over two years. In contrast, it cost al Qaeda about $500,000 to plan and execute. It’s well-known that Canada and the U.S. have the largest bilateral trade flow in the world, pegged at $400 billion annually. Disruption of just a few of our interdependencies would be devastating. Take the St. Lawrence Seaway, for example. Each year, ships using the Welland Canal carry grain, iron ore, coal, and steel worth $7 billion, and nearly two hundred thousand jobs depend on it. How about border crossings? When security was tightened at the Ambassador Bridge between Detroit and Windsor in the first weeks following 9/11, tractor trailers were backed up for six miles. If enough attacks on these types of targets are successful, al Qaeda’s Jihad could bankrupt America.
Do Canadians have what it will take to win the War on Terror? Those who are in uniform risking their lives on a daily basis likely know what it will take. But during my service Canada had a military over eighty thousand strong. Today we have only fifty-two thousand “peacekeepers,” as post-Pearsonian politicians like to refer to them. They are the dwindling few following a proud heritage of duty. I knew that I had to measure up to the example set by my grandfather. In October of 1916, he was among the men of the Fourth Canadian Infantry Battalion tasked to take Regina Trench, a network of muddy German dugouts near the Somme River in France.
The First World War was characterized by some of the most sustained bloodshed in military history, and the day he received shrapnel in his left knee and wrist was no exception. John Marteinson writes in We Stand On Guard, “Entire companies were wiped out crossing No-Man’s Land, others were slaughtered by torrents of machine-gun fire when they came upon the uncut barbed-wire belts. A few greatly reduced companies did get into Regina Trench, only to be driven off or in some cases overpowered by incessant German counterattacks. The day ended with over half of the attacking force dead or wounded, and with no gain at all.”
Yet despite this slaughter the historian noted, “In all of these engagements, large and small, the soldiers showed remarkable determination and great personal bravery, most unreported and unrewarded.” This is no surprise. Canadians were known then as the shock troops of the Triple Entente, and German military intelligence assumed an attack was imminent if Canadian units were spotted near the front.
But the War on Terror cannot be won in five or six years like the twentieth century’s major conflicts. Can Canadians cope with what will likely be a thirty-year campaign? “Psychologically this presents a tremendous burden but such must be met if we are to survive. We are confronted with a life or death situation, which, although quiet today, may become significantly more devastating than at any time since 9/11. At present, Canada’s efforts against all types of terrorism have been modest. Preparation, vigilance, and anticipation must become part of our lives,” says Rubin. “We must not be complacent and must treat the issue with the highest level of importance and be prepared to spend countless more in order to achieve sufficient protection. It is unrealistic for Canada’s governments, public, and military to do otherwise.”
It may in fact be suicidal. To use Churchill’s term, we are the “soft underbelly” of the United States. So it should not come as a shock that al Qaeda has already stated we are “the fifth most important Christian country to be targeted.” The U.S., Great Britain, Spain, and Australia have already been hit.
Who’s next?

Chapter 2

FRIENDS IN HIGH PLACES
by John Thompson
“If I have a different view of the world from many of my contemporaries, it’s because I know a lot more about it than they do.”
The first time I visited Cheyenne Mountain in Colorado, Canadian and American personnel managing the key operations centre for the North American Aerospace Defence Command (NORAD) were busy tracking a Soviet Bear bomber by radar as it passed down the east coast of the U.S. and watching the Iraqis and Iranians fire short-range ballistic missiles at each other through the take from their satellites. The second time, the same mixed crew was using OHTB radar to track an illicit drug flight off the west coast of North America — one that probably imagined it was well out of radar range.
Fortunately, I visited the mountain both times as a civilian. While in the military, there was lots of sensitive material coming over my desk that had been generated by our allies and was being shared with us. These included clandestine photos of emerging Soviet helicopter designs, an analysis of North Korea’s extensive belt of fortified marshalling jump-off points for an invasion of the South, and a candid review of the performance of France’s Exocet anti-ship missiles in the Falklands War. This last was marked for “AUS/CAN/UK/US EYES ONLY” — an example of the close co-operation that occurs between what some of our other allies refer to, half jokingly, as the “Anglo-Saxon Mafia.”
If I have a different view of the world from many of my contemporaries, it’s because I know a lot more about it than they do. Awareness of military realities is rare in Canada, particularly in our government. Worse still, too many Canadians entertain some notions of “soft power” or a supposed legacy as peacekeepers to give much thought as to why a sovereign nation must retain arms. To understand the role our military plays in developing intelligence for Canada, a review of Defence Policy 101 might be useful.
First, the world is a dangerous place. For those who forget, in the last century Canadian military personnel fought in the Boer War, the First and Second World Wars, Korea, the 1991 Gulf War, and the Kosovo air campaign. Canadian troops were often actively engaged in combat ...

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