Telecommunications Scandal Did Deutsche Telekom Spy on Journalists and Board Members?
Part 2: Searching for the Moles
When members of the works council began mentioning a figure of roughly 45,000 jobs that the company planned to eliminate by 2008, the service workers' union Ver.di became involved. Ver.di made its deep opposition to the job cuts clear when it referred to Telekom's plans as "clear-cutting," "an outrage" and a "scandal when it comes to employment policy."
Current Telekom chairman Rene Obermann has promised full cooperation with the authorities.
The environment in which the company was operating changed dramatically during this period. The landline business faced growing competition from small upstart providers, leading to sharp declines in prices and sales. The boom in fast DSL Internet connections had only just begun and had yet to yield the anticipated results. Even the mobile telephony business was no longer achieving the growth rates of earlier years. But while major European competitors adjusted to the new realities by gradually breaking down the classic barriers between mobile telephony, landlines and the Internet, senior executives at Telekom headquarters in Bonn were unable to agree on a strategy for the company. The constant endless meetings didn't help, ending, as they often did, in half-hearted solutions poorly suited to solving Telekom's problems.
The direct consequences were customer flight, crumbling earnings and an ongoing decline in the company's stock price. Criticism of the company grew even further when US investment group Blackstone bought a slice of Telekom in 2006.
Speculation over replacement of the indecisive Telekom CEO began circulating in the press, fueled by internal memos from meetings of the executive and supervisory boards that could only demonstrate one thing: that Ricke was indecisive and wavering. His tenure as CEO quickly came to an end after that. Supervisory Board Chairman Zumwinkel forced the hapless chief executive to resign and replaced him with Obermann.
'As Full of Holes as Swiss Cheese'
That was in November 2006, the date when Telekom now assumes the spying came to an end. The author of the fax from Berlin, on the other hand, claims "we can prove that we were still involved in the 'Clipper' project after November 2006." The fax says one only need to ask people like Zumwinkel or Ricke.
At the end of last week, both executives sharply denied having had any knowledge of specific eavesdropping activities. But former CEO Ricke also did not deny that Telekom, during his tenure, repeatedly tried to find leaks within the company. "Telekom," said Ricke, "was as full of holes as Swiss cheese." According to Ricke, internal documents were repeatedly leaked to the public, especially during the second half of his term, "some of which contained information that could affect the stock price" -- about planned acquisitions abroad, for example, or planned job cuts.
Speaking to SPIEGEL last Friday, Ricke said: "We discussed this often in the executive board, and we decided to take active steps to combat it." In consultation with Supervisory Board Chairman Zumwinkel, the corporate security department, which was then headed by Labor Director Heinz Klinkhammer, was "many times assigned to complete the necessary investigations."
Klaus Zumwinkel, who recently resigned from Deutsche Post amid tax evasion allegations, has denied any knowledge of alleged spying at Telekom.
In some cases, the corporate security department "hit pay dirt after some detective work." Ricke, however, insists that he was unfamiliar with the methods that the department's several hundred employees used, emphasizing: "I never gave illegal orders at the time, and certainly never asked anyone to eavesdrop on telephone connection data."
A spokesman for Zumwinkel issued a similar statement: "A supervisory board director cannot give instructions to employees of the company. The alleged storage of data occurred, if at all, without the consent of the then supervisory board chairman." The spokesman went on to say: "It's a good thing that the alleged procedures and incidents are being investigated."
Required by Law to Protect Confidentiality
Both men have said that they are not willing to rule out the possibility that the eavesdropping campaigns existed. They also insist that they had no knowledge that anything illegal was taking place.
Telekom's underhanded use of data is being exposed at a time when the government is holding the Bonn-based company to extremely high standards, in terms of both data confidentiality and trustworthiness. As of Jan. 1, all telephone and Internet providers in Germany are required to keep all connection data on file for six months. This reflects an EU decision reached after the 2004 Madrid terrorist attacks, as well as the wishes of German investigators. Otherwise, they fear, all evidence could already be deleted if they happen upon a suspect months after a crime was committed and then attempt to unravel the network of accomplices.
But this makes industry leader Telekom into something of a law enforcement arm of the state, now more than ever. And it makes it all the more embarrassing that the company is now under suspicion of having abused the wealth of data at its disposal.
Just how sensitive such data is, whether collected by Telekom or other telecommunications companies, was made clear by Germany's high court in March when it significantly narrowed the scope of new regulations governing data storage. Under the ruling, investigators can only gain access to the telephone records of suspects charged with serious crimes that carry a potential prison sentence of more than five years. In all other cases, Telekom is required to preserve the secrecy of its customers' data.
But now Telekom's old management has come under the suspicion that it was less than trustworthy for many years, and not just with the personal data of its own supervisory board members and executives. The attempt to match up the board members' and executives' phone records with those of journalists suggests a stunning disregard for democratic values.
Courts in the past have tightened the reins several times on investigators who were eavesdropping on journalists with the intent of uncovering their sources within government agencies and judicial bodies. Thus, for example, the German Constitutional Court declared the search of the Cicero editorial offices in 2004 to have been illegal. An attempt by authorities in the state of Saxony to use the telephone records of a Dresdner Morgenpost journalist in an investigation was likewise struck down.
And it was revealed in 2006 that the Bundesnachrichtendienst (BND), the German foreign intelligence agency, had illegally placed journalists under surveillance for years while searching for a mole in its own ranks. As recently as a few weeks ago, the federal government had to issue a public apology when it was revealed that the BND had lapsed back into its old practices with SPIEGEL reporter Susanne Koelbl.
It should have been clear to the Telekom executives that by scanning employees' and board members' telephone records for calls made to journalists, they were not just operating in a gray area, but in a forbidden zone. In that zone, putting too much trust in the head of a Berlin consulting is apparently a dangerous thing.
According to the letter from that company manager, the situation had become "extremely threatening" to him and his company. If his fax were to be passed on to third parties other than Telekom CEO Obermann, the company would have to "interpret it as a declaration of war," the manager wrote, adding that he does not wish to lose the opportunity to defend himself "in the media, if necessary."
He is likely to have that chance very soon.
By Beat Balzli, Jürgen Dahlkamp, Frank Dohmen and Klaus-Peter Kerbusk
Translated from the German by Christopher Sultan
- Part 1: Did Deutsche Telekom Spy on Journalists and Board Members?
- Part 2: Searching for the Moles