Two Suspected Israeli Computer Hackers Face Extradition from London

Update 2
Nine of Israel’s top business executives and 11 heads of three leading inquiry companies – including Modiin Ezrahi – are in custody suspected of complicity in a massive computerized commercial espionage conspiracy.
Sunday, May 29, the Tel Aviv magistrate lifted a gag order on the case code-named Horse Race. The prosecution is reported to have located a state witness.
Michael Haephrati, who was arrested with his wife in London Thursday, May 26, is suspected of designing the illegal raider software called Trojan Horse for the three inquiry firms,
They offered clients business intelligence on their rivals, some of whom trade on the stock exchange, by illegally planting spy software in the targeted computers and downloading their classified data.
Clients under suspicion of accepting the offer include Volvo Motors importers, Yes satellite TV, Pelephone and Cellcom cell phone license- holders. Their senior officers are in custody.
Their victims included Orange (Partner) cell phones, Hot cable TV, Strauss-Elite, Champion Motors, Mei Eden mineral water, Ace DIY, and Zoglobek sausages.
Earlier, debkafile reported:
Michael Haephrati, 41, and Ruth Brier-Haephrati, 28, were arrested by Scotland Yard in London on an Israeli extradition warrant and remanded in custody in Brixton and Holloway prisons until a further hearing on June 3.
Apart from “unauthorized modification of the contents of a computer” between December 12, 2004 and February 28 this year, the charges against the couple are subject to an all-inclusive Israeli court gag order.
In professional intelligence literature, this locution usually refers to industrial espionage by the illegal invasion of computers. The offense most often takes the form of an unauthorized “mirror” planted in a target’s computer to download its contents to another computer. The kind of software used is not new; it derives from the PROMIS program developed in the United States in the 1980s to help the US Justice Department and the FBI crack financial crime cases. The targets of PROMIS and its offspring never know they are raided, their firewalls penetrated and their passwords cracked.
Over the years, many intelligence agencies, including Israel’s, upgraded the earlier PROMIS, and developed better protective software against these silent invaders. Some of their experts ended up on the world market, notably in the US, India, Russia, and probably Israel too. They can be found selling their expertise to security and financial companies – or even to organized crime. The illegal practitioners are known in professional parlance as “black hat hackers.”
Corporate America has suffered vast losses, estimated in many billions of dollars, from such hackers who are contracted by rival businesses to lift their customer lists, the contents of their contracts, their marketing strategy and financial situation. It is believed that most victims decide not to complain to the police for fear of publicity that would ruin their business and undermine their stocks. The soundless black hat hackers often as not get away with their crime. Indeed, many are hired by victimized business to trace the intruders and strengthen its security. The underground hacker will then come in from the cold and become a “white hat hacker.”
The Scotsman reports that before he was arrested on the Israeli extradition warrant, Michael Haephrati, who also has German nationality, was questioned by detectives from the National Hi-Tech Crime Unit on a “separate matter.” He was released by the unit on police bail Wednesday, May 25, pending further inquiries into allegations of “offences under the Computer Misuse Act 1990.” Later, he was detained by Scotland Yard on the extradition matter.
British legal experts told debkafile that the UK National Hi-Tech Crime Unit’s inquiry indicates Haephrati is also suspected of computer offenses in Britain as well as Israel. The British can be expected to insist on precedence for their inquiry and legal proceedings before handing him over to Israel. This could hold up the Israeli process for many months.
The suspect’s sister Shifra Hephrati, a playwright who lives in Tel Aviv, is in London to look after the couple’s six-year old child, Emma.
Asked after the Bow Street hearing about her brother, she said, “We didn’t know anything about what he was doing except that it was something important. “
The mystery deepens.

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