Corporate Spies Like Us: A Peek Into a Shadowy World
Mar 4th 2010 11:26AM
Updated Mar 4th 2010 5:52PM
Some social critics say companies that lay off employees are doing permanent damage to themselves. After all, they've spent years training the workers they're casting aside. Moreover, they may be abruptly discarding a great deal of institutional memory.
It turns out there's another cause for concern: Laid-off workers could be a valuable source of information to corporate spies. Such spooks have been known to stage fake job interviews to ferret out information about a former employer's ways and future plans. Even still-employed workers "can be surprisingly candid about their own company when they think they're interviewing for a job," writes Politico correspondent Eamon Javers.
At its best, Javers's uneven, intermittently absorbing new book, Broker, Trader, Lawyer, Spy: The Secret World of Corporate Espionage (Harper, $26.99), exposes a little-known world of black ops, eavesdropping, and corporate skullduggery. But the book is marred by an elastic definition of corporate espionage, stretched to include everything from routine financial investigations to ordinary detective work conducted by Kroll Associates. Worse, the volume's historical chapters are poorly researched and larded with extraneous detail.
Javers kicks off the book with one of his strongest stories: an account of a covert 2005 operation, Project Yucca. Conducted by private intelligence firm Diligence LLC for the Russian financial-industrial conglomerate Alpha Group Consortium, the mission entailed finding out as much as possible about Bermuda-based rival IPOC International Growth Fund. The operatives, all veterans of Western intelligence services, targeted an impressionable British-born KPMG accountant, Guy Enright.
In clandestine meetings, Diligence agents hinted that IPOC, a KPMG client, might be tied to the Russian mob -- and that Enright could serve his country by turning over confidential financial documents. This he did, furtively leaving such papers at designated, secret drop-off points. Cue the James Bond theme, running through Enright's Walter-Mitty-like brain. "It was a huge intelligence haul for Diligence," Javers writes, "which used it to stir up problems for IPOC." But within months, the operation was short-circuited when KPMG was tipped off by parties unknown -- and the accountancy filed suit against the intelligence firm. The spook outfit, which still maintains an office two blocks from the White House, today says that it has changed its roguish ways.
The Spies from Mars
Another engrossing tale involves the anything-but-sugary relations between chocolate giants Nestlé and Mars Inc. In 1997, the Swiss-based Nestlé encountered a sudden, seemingly well-organized campaign of resistance when it began marketing a new brand, Nestlé Magic: a small chocolate ball enveloping a plastic shell that contained a tiny Disney-themed toy. Although the U.S. Consumer Products Safety Commission had O.K.'d the product, numerous federal agencies and state attorneys general were inundated with complaints suggesting that the toy was a choking hazard.
Suspecting that rival Mars was somehow stirring up the problem, Nestlé hired Kroll Associates and, later, spy firm Beckett Brown International. After an investigation involving both surveillance and that yucky practice known as Dumpster-diving, Beckett fingered a Virginia consulting firm as the organizer of a Mars campaign against Nestlé.
But Beckett's activities didn't end there, Javers writes: Soon, on Nestlé's behalf, Beckett was running its own media-and-regulatory attack against Whetstone Candy Co., a small manufacturer that was producing its own toy-inside-a-chocolate product. Whetstone's goodies tanked -- but things turned out badly for Beckett, too, as that company fell apart in 1999.
In contrast to such gripping recent tales, Javers really falls short in his historical chapters, which tend to be thinly sourced and, consequently, contain inaccuracies, sometimes in the service of sensationalism. We get a full chapter on Allan Pinkerton, America's first private eye and the founder of the sometimes-notorious detective firm that carried his name. (Since 1999, the Pinkerton Agency has been part of Sweden-based Securitas AB.) That section is drawn largely from one book, James Mackay's Allan Pinkerton: The First Private Eye. There's also material on Abraham Lincoln and Jesse James, both presumably somehow tied to corporate espionage.
Perhaps the most flawed section looks at the Pennsylvania coal-field wars of the 1870s, and the so-called "Molly Maguires" who were charged with numerous shootings and murders of coal-company officials. Again, possibly due to his overreliance on too few sources, Javers fails to take account of historians' growing understanding that there probably was no such organization: Some (but not all) of the 20 men who were tried and hanged may have been involved in acts of violence -- but their organizational link was probably not to Molly but to a respectable Irish fraternity, the Ancient Order of Hibernians. In fact, the chief infraction of these "terrorists" may have been to be on the other side of a labor war with the wily and ruthless head of the Pennsylvania Railroad, Franklin Gowen.
Javers' problems don't end there. There's also material on the plot to involve the Mafia in an assassination of Fidel Castro and on infighting among the associates of oddball billionaire Howard Hughes -- but what do these matters have to do with corporate espionage?
Such sections tend to give the book a padded feel, and raise key questions: Are there just not enough cases of true corporate espionage to fill an entire book? Or, alternately, perhaps such spooky activities are all around us, but Javers failed to uncover a sufficient number of them. We simply don't know. For the answer to those questions, the reader will have to wait for another, better book.