Just business: how Russian technology provides the eyes and ears for the world’s Big Brothers


In December 2011, Wikileaks released ‘Spy Files’, a project revealing details of the burgeoning surveillance and interception industry. The list of companies providing high-tech equipment to governments included a number of Russian firms, which are emerging as global leaders in the industry. Andrei Soldatov and Irina Borogan took to investigate how the Soviet Union’s expertise in spy technology is being adapted to the new reality of global capitalism.

Andrei Soldatov Irina Borogan
25 January 2012

The Arab Spring demonstrated to all just how important surveillance technologies have become for repressive regimes. Not without reason. Human rights organisations have begun to speak of a need to curb sales of surveillance technologies to governments of dubious repute, in much the same way one would limit sales of arms. Russia’s rulers need not especially worry, however. The Kremlin is already more than well provided for in the supply of surveillance equipment produced on its own doorstep. What is more, Russian surveillance technologies are right at the forefront of the global industry; and repressive regimes are rarely discriminated against when lucrative trade deals are at stake.

The new Sharashka

Sergei Lvovich Koval is a leading analyst at the Speech Technology Center (STС). He is a small man, with the appearance of a typical Soviet-era engineer. As we sat in empty cafe near Chernyshevsky Metro Station in St. Petersburg, Koval spent an hour giving us an enthusiastic description of his company. As he rightly informed us, the Centre is a world leader in speech recognition. It owes particular fame, or notoriety, to the Wikileaks ‘Spy Files' project, which included it on the list of the world’s surveillance technology suppliers.

STC has an interesting history. A descendent of a Soviet secret technologies unit run under the auspices of the KGB, it has direct connection to the Marfino Sharashka, the secret GULAG research laboratory that Alexander Solzhenitsyn refers to in his novel, ‘The First Circle’. The ‘Sharashka’ was a camp for convict engineers and scientists who were plucked from various camps to carry out secret work on to identify voices calling foreign embassies in Moscow.

‘Our Center was founded in 1990’, Koval explained to us. ‘Before that all of our employees worked in the applied acoustics unit — a department that was run by the KGB, but formally attached to the scientific development centre of the Ministry for Communications. Many of the people in the organisation were KGB employees – but I only worked freelance – and the State Security Committee paid 15% of the salaries. Of course it was strictly confidential work and we were not allowed to talk about what we were doing. The ‘Sharashka’, where Solzhenitsyn worked, was transferred from Moscow to St. Petersburg. The people described in his novel continued to work in the St. Petersburg outfit even after their release, and I joined them when I came to work in the unit back in 1973’.

Despite what he knows about what went on in the ‘Sharashkas’, Koval says he regrets the disintegration of the research department. ‘In the Soviet Union, we had an excellent system of developing technologies for the protection and safeguarding of the state’, he says. ‘There was a military commission in the Academy of Sciences of the USSR and it had a department of applied problem-solving. This department took orders and research commissions from all the agencies of the KGB and the Ministry of Defence, who financed our work right up until 1988 or 1989. We were able to distribute this money right across the different academic institutions as we saw fit. We could effectively sponsor any project that we wanted’. The applied acoustics unit where Koval worked had 300 employees and the scientific department of the KGB had over 10 thousand people working in it.


The Marfino Sharashka, as featured in Solzhenitsyn's
'First Circle'. The Russian surveillance and
interception industry in Russia owes much to the
research that was carried out in this building.

In 1990, the KGB’s R&D budget was cut to a tenth of its original size and Koval’s department was liquidated. Seven of its former employees continued to collaborate on long-term development projects, and eventually set up the STC. Only three of the original founders of the company still work there today; the firm now employs up to 350 people – roughly the size of the original Soviet department. And while they can no longer distribute work among 40 different state agencies, as once was the case, the Centre has many opportunities to outsource particularly difficult work. ‘We have friends in all the special agencies who are only too keen to help’, Koval says.

Surveillance valley

In July 2011, the Center opened a daughter company called ‘STC Innovations’, which took up premises in Skolkovo (President Medvedev’s project that attempts to build a Russian ‘Silicon Valley’ of high-tech industries just outside Moscow). The mission of the STC Innovations, it was announced, would be to develop technology for identifying people by voice (‘audio forensics’) or facial image alone.

The company has since developed technology that they consider unique in its capability and reach. It is able, for example, to store many millions of items of biometric data (voice samples and photo images) and match to individuals by searching all of the world’s communication channels (including in video files). The voice recognition technology that they have developed can identify the speaker, regardless of the language, accent or dialect that is used (they identify voices by the physical parameters of the sound produced alone). They also have the means to use fingerprint and IRIS recognition technology as additional applications.

STC Innovations have supplied hardware to the secret services and big cheeses in the Russian government, with the nominal function of combating crime.

In September 2011, the state-affiliated Gazprombank announced that it would be investing in STC (indeed, it has since become the joint owner of the STC). Gazprombank, to clarify, is part of the vast business empire of Yuri Kavalchuk, a close friend of Vladimir Putin. At the time, the Centre’s CEO, Mikhail Khitrov, commented on the deal: ‘We are the world’s leading developer of voice recognition and synthesis technologies, voice biometrics and speech analysis. Our aim is to develop these innovations and realise their potential on the Russian and global markets. Gazprombank fully supports our initiative’.

Work abroad

In 2010 the STC completed its first national voice recognition project. The project was implemented in Mexico, where the system was able to deploy state records of human voice and biometric details to identify individuals from fragments of speech alone. Mexico’s national database of voices was made up of speech fragments recorded from criminals, law-enforcers and many law-abiding citizens, who are obliged to supply vocal samples for state regulated activities, such as obtaining a driver’s licence.

The STC does not limit itself to vocal recognition, and is particularly engaged in developing face recognition technologies. It is actively canvassing for a tender with the Russian Secret Services and the company is already implementing some of its technologies abroad.  Koval, who headed up the Mexican project, confirmed that the STC is also exploring the possibilities for identifying individuals from photographs.

‘It’s all the same technology. I can’t think what can be done about that! If governments listen in on people’s conversations, it’s not the microphone’s fault!’

Sergei Koval, Analyst, Centre for speech technologies, St Petersburg

Mexico is not the STC’s only client outside Russia. The company’s technology is already used in Kazakhstan, Kirgyzstan, Uzbekistan and Belarus, where the government is establishing a national identification database of all its citizens.

The STC is already trading in Thailand and Singapore and is keen to break into the Chinese market. The firm supplies its wares in India and the Middle East and Koval has confirmed that Saudi Arabia, Algeria, Yemen and Turkey are among its customers in that region. Its Latin American clients include Columbia and Equador, where STC is already supplying its face recognition technology.

Don’t blame the microphone!

Koval sees no moral problem in the fact that many of STC’s clients may use their technology to keep track of the activities of journalists, dissidents and human rights campaigners.

‘What can we do about it? We just come up with the hardware. It’s just technology that is developed with law-enforcement in mind. Sure, you can use it against the good guys just as easily as you can use it against the bad guys. One way or another, these governments will be able to use surveillance technology, whether we supply it or not. Take, for example, face recognition technology: you can film a demonstration and with that film you can identify the journalists, the drug-addicts, the recently released prisoners or the nationalists. It’s all the same technology. I can’t think what can be done about that! If governments listen in on people’s conversations, it’s not the microphone’s fault!’


STC advertises many of its products on its web-site, 
complete with with descriptions and thumbnail photos.
Yet speaking about them with journalists is somehow
regarded unthinkable.

Koval seemed flustered by our line of questioning.

‘All this talk about technology catching dissidents is just bullshit! It’s typical of the kind of psychological warfare the American’s use against their opponents. I think all of these arguments about human rights are completely hypocritical. The Americans just use them for their own purposes’.

Sergei Koval denies that the Wikileaks publication has affected the STC’s public relations policy, but it is clear that now the company’s leadership avoids all contact with the media.

Soon after interviewing Koval we contacted Dmitry Dyrmovsky, the head of the STC Moscow, with a request for a demonstration of their voice recognition technology products. When Dyrmovsky found out that we had been in contact with Koval, he asked us not to publish anything that Koval had told us.

‘Sergei Lvovich Koval has no right to represent the company and he had no right to talk to you, even though I have no idea what he might or might not have told you’, said Dyrmovsky. He refused point blank to show us any of STC’s products, even those commercial products that are openly advertised on the company’s website.

Union of Secret Surveillance Republics

The Speech Technology Center is not the only Russian company that produces surveillance technology to sell to the world’s most oppressive regimes. The company Analytical Business Solutions (who we profiled in the first article in this cycle), for example, sold its blog and social network-monitoring technology, ‘Semantic Archives’ to the Belarusian police force. MFI-Soft, the largest Russian producer of telecommunication traffic interceptors, has sold its technology to Kazakshtan and Uzbekistan, which enables their government to monitor Internet and telephonic traffic.

These companies are reluctant to comment on their international contracts. When we asked MFI-Soft’s press secretary, Natalia Korobkova for information about the kind of technology her company had supplied to Kazakhstan and Uzbekistan, we received the following statement back:

‘We supply law-enforcement and information security products to these countries. Information about these products is strictly confidential. In any case, we do not deal directly with these clients. We work through a mediating agency, ALOE Systems and we only have direct contracts within Russia’.

So why, then, is information about the contracts so confidential? ‘That’, Ms Korobkova said, ‘I cannot answer’.


When it comes to state surveillance and represssion,
other post-Soviet states are only too willing to follow the
Russian lead. Photo (cc) www.kremlin.ru

It is worth pointing out that many governments of Former Soviet Union countries are still inclined to follow Russia’s example, which is a boon for Russia’s surveillance companies. In March 2010, president of Belarus, Alexander Lukashenko, signed an order that allows the secret police and the president’s analytical centre to have unrestricted access to Belarusian communications databases. This system was given exactly the same name as its Russian equivalent – The System for Operative Investigative Activities (or SORM, in Russian).

In April of the same year, Igor Sukach, CEO of the Belarusian firm, Alternative Digital Network, confirmed that Lukashenko’s new law was being implemented by his company’s subsidiary, Atlant-Telecom, for the sum of sixty thousand dollars. We contacted Atlant-Telecom to ask them what technologies they used or their new surveillance job, and we got the following response: ‘The terms of the contract and considerations of security prevent us from naming the system used for implementing SORM or its supplier. We cannot even disclose where this technology has been developed. We very much regret not to be able to elaborate, but the conditions of privacy are non-negotiable’.

In fact we learned from one of the companies that implements SORM in Russia, that like Belarus, Uzbekistan, has also copied the Russian law on state surveillance.

Everybody’s at it

We observed a pointed indifference to any moral considerations among all of the employees of surveillance technology companies, whom we managed to interview. Furthermore, the new generation of specialists have effectively not changed their affiliations. In the past, the industry was bound to the Soviet secret services, and today it is closely linked to Russia’s military industrial complex.

The 61-year old Sergei Koval is a typical product of his Soviet training. He has always worked in the interests of the KGB and he feels deeply uncomfortable thinking about anything outside his technological comfort zone. He instantly resorts to the stock responses of his employer when confronted with a question outside his technical expertise.

‘We observed a pointed indifference to any moral considerations among all of the employees of surveillance technology companies, whom we managed to interview.’

Vadim Sekresh, a 40-year-old graduate of the applied mathematics department of St. Petersburg University, is the CEO of another high-tech company, the telecommunications-interception technology producer Protei Special Technologies, which has contracts with Uzbekistan and Belarus. He was unruffled by the Wikileaks revelation that his company is a leading surveillance technology supplier.

‘I didn’t pay it any attention’, said Sekresh. ‘We work with mobile networks in many different countries, so that’s how they must have got information about us. I didn’t really look into it because the whole thing doesn’t bother me. In fact we don’t sell that kind of technology – surveillance bugs and that kind of thing. We aren’t the only ones producing such applications for mobile anyway’.

The fact that Russian surveillance technology companies display few qualms about the application of their products is, on one level, far from surprising. Given that most of the companies listed on the Wikileaks list are actually based in the West, it is very likely that the moral indifference is a global phenomenon.

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