WHAT IS CSEC?
Communications Security Establishment Canada is commonly known as this country's electronic eavesdropping agency.
It has a $350-million budget and about 2,000 employees. By law, it has three mandates: to gather foreign intelligence, to safeguard Canadian government communications and computers from foreign hackers and to help other federal security agencies where legally possible.
The federal government is building a new, $1-billion headquarters for CSEC on the outskirts of Ottawa.
CSEC used to be a division of the Department of National Defence but in 2011 became a standalone agency reporting to the Minister of National Defence. It nevertheless serves all of government.
When it comes to foreign intelligence collection, it appears a dominant rule is to not spy on Canadians – even those abroad.
CSEC, which has seen its budget increase significantly in the wake of the Sept. 11, 2001 terrorist attacks, employs hundreds of scientists and engineers to vacuum up all the data it can abroad. It listens in on phone calls and sifts through electronic communications.
Its intelligence-gathering priorities, set by the government of the day, focus on matters such as counter-terrorism. But some experts say CSEC has also quietly gathered economic intelligence for years.
WHOM DOES IT TARGET?
Since the Sept. 11, 2001 attacks, CSEC has been enlisted in the global war on terror to monitor both perpetrators and sponsors.
Its mandate is to help protect Canada's national security, and its electronic eavesdropping is deployed to that end. Top former CSIS official Ray Boisvert has explained that both CSEC and his former employer have a "mandate to go after foreign powers if those are acting in a way that's inimical to our interests, so the poster child for that would be Iran."
But Martin Rudner, a former Carleton University professor, says Canadian defence ministers have spent decades directing CSEC to collect foreign intelligence that includes data acquired through economic espionage.
WHAT WAS CSEC ALLEGEDLY DOING IN BRAZIL?
In the spring of 2012, CSEC's "Advanced Network Tradecraft" team apparently took a deep dive into encrypted servers at Brazil's Ministry of Mines and Energy (MME), according to leaked slides.
Over a few months, using a suite of programs known as "Olympia," the Canadian hackers put themselves in a position to see reams of data passing through MME's servers. They gradually zeroed in on e-mails and smartphones associated with "targets" of interest.
CSEC was pleased with these methods. So much so that an analyst made them the subject of a "top secret" PowerPoint presentation given to allies in June, 2012.
WHAT, IF ANYTHING, DID CSEC TAKE?
The men who might know best – Prime Minister Stephen Harper, Defence Minister Rob Nicholson and CSEC Commissioner John Forster – aren't saying.
What we know, as the slides so memorably put it, is that the MME had "OLYMPIANs in the house." This means that the Canadian hackers using the "Olympia" spying programs were inside the Brazilian government's communications infrastructure – and likely laying the groundwork for something bigger.
"I am working with TAO to further examine the possibility for a Man on the Side operation," a CSEC analyst wrote in her briefing to allies.
TAO mostly likely refers to the U.S. National Security Agency's "Tailored Access Operations" hackers. This group is renowned for developing ingenious ways to siphon off data, including through a hard-to-detect method known as the "Man on the Side."
WHY CONDUCT ECONOMIC ESPIONAGE?
A few years ago, an Ottawa security official complained that foreigners were saving "billions" by conducting economic espionage against Canadians.
"Canadians tend to think, well, 'Why would anybody want to spy on us?' " said Richard Fadden, the former director of the Canadian Security Intelligence Service in a 2009 interview with the CBC.
But he said such spying is rampant because "we're one of the most advanced nations in the world."
This week it was revealed that Canada may be gathering a degree of economic intelligence itself by spying on foreign countries.
Everybody seems to spy. Yet some officials suggest countries such as Canada and the United States hold themselves to a higher standard in terms of collecting economic intelligence.
U.S. Director of National Intelligence James Clapper said last month that America is interested in piecing together information about terrorist financing and big-picture economic issues.
But, he insisted, "what we do not do, as we have said many times, is use our foreign intelligence capabilities to steal the trade secrets of foreign companies."
He added that Washington does not help "U.S. companies to enhance their international competitiveness or increase their bottom line."
WHAT'S BEEN THE REACTION IN BRAZIL?
Canada's attempts to mollify Brazil have been noted with little comment here. Media report that, after initially refusing to comment on the espionage allegations, Mr. Harper said on Tuesday that he was "very concerned" and that his government was "reaching out very proactively to our Brazilian counterparts."
Neither the Brazilian nor the Canadian foreign affairs departments will say anything further about what form that proactive engagement is taking.
The damaged relationship with Canada is taking a back seat here to ongoing concern about spying by the U.S. National Security Agency, whose eavesdropping on the Brazilian government and the national energy company Petrobras was revealed last month.
On Wednesday, Glenn Greenwald, the Rio-based American journalist who collaborated with the Brazilian television network Globo to make the revelations public, and his partner David Miranda testified before a parliamentary inquiry into U.S. spying on Brazil.
Mr. Greenwald told the senators and members of Parliament on the committee that Brazil must "protect" Edward Snowden, saying governments keep thanking the former NSA contractor for the information he has made public but then do nothing to assist him. Mr. Snowden is living – reportedly on charity – in murky asylum in Russia. Brazil was among the countries that declined Mr. Snowden's request for asylum after he fled the United States – in fact, it did not reply.
"If a government is seriously advocating freedom and freedom of the press, it needs to start protecting the person who started it all," Mr. Greenwald said in Portuguese.
Senator Pedro Taques asked Mr. Greenwald and Mr. Miranda, who is Brazilian, to hand over all documents related to Canadian and U.S. spying on Brazil, saying they pertain to a "crime" and must be properly secured.
Mr. Greenwald and Mr. Miranda declined to do so, saying it would be treason to give secret U.S. government documents to the Brazilian government.