Israeli spyware company chief steps down as part of internal restructure

Israel's NSO Group – which developed the controversial Pegasus spyware that hit the headlines in 2021 – has announced that CEO Shalev Hulio is leaving his post as part of an internal restructuring programme. 

In 2021 private Israeli firm NSO Group denied media reports its Pegasus software was linked to the mass surveillance of journalists and rights defenders. AFP - JOEL SAGET

In addition to Sunday's announcement that Hulio was stepping down as CEO, the indebted, privately owned company also said it would focus sales on countries belonging to the NATO alliance.

In July last year, a multinational journalistic investigation revealed that Pegasus spyware had been sold by NSO to governments around the world and used against human rights activists, politicians, reporters and others.

The firm's chief operating officer Yaron Shohat will now "take the lead" and manage the reorganisation process, according to a spokesperson for the group.

😮 NSO Group is going to sack 100 employees and Shalev Hulio steps down as CEO, in order to "adjust itself to challenges". 😂
Aah, the challenges of getting caught over and over enabling surveillance of activists, journalists and political opposition. 🙃https://t.co/rqV2XknUi6

— nex (@botherder) August 21, 2022

Working with NATO

The reorganisation "will examine all aspects of its business, including streamlining its operations to ensure NSO remains one of the world's leading high-tech cyber intelligence companies, focusing on NATO-member countries," a reference to the 30-member North Atlantic Treaty Organization political and military alliance.

Pegasus spyware is used to infiltrate mobile phones and extract data or activate cameras or microphones.

NSO Group maintains the software is only sold to government agencies to target criminals and terrorists, and sales require Israeli government approval.

It also stressed that as its foreign sales are licensed by Israel's defence ministry, it it does not control how customers use Pegasus. 

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Court documents

The company was already mired in debt before the spying scandal broke and led the United States to ban NSO.

Court documents from a dispute involving NSO, its creditors and the Berkeley Research Group – majority shareholders of NSO's parent company – suggest investors sought to push NSO to continue selling Pegasus to "elevated risk" countries with questionable human rights records, in order to maintain revenues.

But Berkeley Research demanded a halt to suspect sales without more internal reviews, citing an "absolute need for [NSO] to address the underlying issues" that saw it banned in the US.

Hulio, a co-founder of the company, said in the NSO statement that the firm "is reorganising to prepare for its next phase of growth."

He praised Shohat as "the right choice" and said NSO's technologies "continue to help save lives worldwide".

However, revelations about the use of Pegasus spyware continue to emerge.

In late July, the European Commission – the EU executive's arm in Brussels – said it had found indications that phones of some of its top officials had been compromised by the spyware

Also last month, an international digital rights group report said dozens of Thai democracy activists had been targeted by Pegasus during widespread anti-government protests.