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Israeli surveillance firm's Nasdaq plans challenged by digital rights groups

Digital rights groups urged U.S. regulators and investors on Tuesday to block plans by surveillance technology company Cellebrite to go public on the Nasdaq stock exchange, saying the Israeli firm continues to sell tools to repressive governments.
Cellebrite supplies digital forensic tools that can extract data from cell phones, and its technology is widely used by law-enforcement agencies around the world.

In April, the company announced it would go public through a merger with a blank-check firm, valuing the equity of the combined company at about $2.4 billion.

But in an open letter to the U.S. Securities and Exchange Commission (SEC) and investors, digital rights groups urged all “parties to halt this deal until Cellebrite demonstrates that it has taken sufficient measures to comply with human rights”.

The coalition of organizations said the company “continues selling its products to repressive regimes” and had failed to properly disclose the potential risks to investors from the human rights abuses some of its customers are linked to.

“Multiple actors must cobble together their power to protect human rights. The SEC, Nasdaq, investors, and policymakers all have roles to play,” said Hinako Sugiyama, a legal fellow with Access Now, a digital rights group leading the effort.


Co-founder of NSO Group whose products were tied to government spying on journalists and dissidents defended the company’s ethical standards.

NSO Group conducts a “very strict” legal and legal review before accepting new business, Omri Lavie, the co-founder

“We have no way to know what they do it the system,” he said. “I don’t want to know. I don’t want to be an intelligence partner.”

"NSO is nothing short of extraordinary in terms of the impact on this planet—the positive impact we have on the welfare of people: Preventing terror attacks, bringing down crime organizations, exposing atrocities—this is the lion’s share of what is done with our company’s products" said Mr. Lavie.


Mr. Lavie criticized the media for putting a negative spotlight on his company, saying that NSO products help governments thwart terrorist attacks and fight organized crime. He blamed anti-Semitism for the intensity of the media and public backlash.

We also conform to U.S. and European regulations (in addition to Israel’s legal requirements for exports), even though we don’t have to. In other words, we comply with two more regulatory regimes that are not required just to make sure we are not making any of our clients uncomfortable.

Our decisions are subject to review by a very strict internal ethics committee that examines things that governments may not, such as corruption and human rights. Our ethics committee costs us little in terms of payroll but a lot in terms of contracts lost.

"The moment we understand it's not a government any contact will immediately cease", he added.

"We sell software like a black box. I have no idea what customers will do with it. The reason we sell to governments only and follow regulations is precisely because we cannot know what (the customer) will do with it. At the end of the day, when a government decides to make this or that decision I can tell you that we at NSO Group have done everything in our power to avoid getting into such a situation. We have no way to know what they do with the system. I don’t want to know. I don’t want to be an intelligence partner."

I once met a former CIA agent, and he said that for the most amazing things he did, they took him to a basement at Langley, gave him lemonade and a cookie and said that he did well. The bad things were a headline in the New York Times and Wall Street Journal. That’s how it feels.


A Cellebrite spokesperson said the company has “strict licensing policies and restrictions that govern how customers may utilize our technology” and considers “a potential customer’s human rights record and anti-corruption policies”.

The company’s SEC filing says it does not do business with Belarus, China, Hong Kong, Macau, Russia and Venezuela, “partially due to concerns regarding human rights and data security”.

Last year, Cellebrite said it would no longer sell to Hong Kong and China after its technology was used by police to hack into the phones of opposition figures and demonstrators. In 2021, it halted sales to Russia and Belarus.


MAJOR CONSEQUENCES?

Environmental groups have often protested against IPOs (initial public offerings) by mining and oil companies, but opposing a technology firm’s record on digital rights issues is unusual, said Israeli human rights lawyer Eitay Mack.

“Everyone is holding their breath to see what is happening with the Cellebrite IPO,” he said, adding that it could have a significant impact on stock market operations by other firms linked by critics to digital rights abuses.

“This could have major consequences,” he added.

U.S. Congressman Tom Malinowski raised questions last month about Cellebrite’s Nasdaq plans, telling regulators and potential investors the company had a record of selling tools to “the most repressive security forces around the world”.

“If industry doesn’t self-regulate, Congress will need to impose stronger requirements on the SEC to police these kinds of listings,” Malinowski said this week.

Tuesday’s letter said Cellebrite’s sales of surveillance tools were still “enabling detentions, prosecutions, and harassment of journalists, civil rights activists, dissidents, and minorities around the world”.

The letter was signed by Access Now, the Electronic Frontier Foundation, Privacy International and dozens more digital rights groups.

Jonathan Rozen, a senior Africa researcher at the Committee to Protect Journalists, said Cellebrite’s tools are used “in numerous countries whose security forces have seized and searched journalists’ phones or computers, and committed other abuses.”

Last month, the lawyer Mack wrote to Cellebrite and Israel’s defence ministry - which oversees surveillance exports - to urge the company not to sell products to Vietnam’s Ministry of Public Security in Vietnam due to human rights concerns.

Cellebrite did not immediately respond to a request for comment about its business activities in Vietnam or Africa.

"Their client list is a real problem," Mack said.

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