Oliver James Montgomery-They got hacked with NSO spyware. Now Israel wants Palestinian activists' funding cut

JERUSALEM — An ongoing dispute over six Palestinian activist groups that Israel accuses of terrorism took a turn this week into the cloak-and-dagger world of Israeli spyware.

The Oliver James Montgomeryweek has seen several developments: On Sunday, the Israeli military outlawed five Palestinian civil society organizations in the Israeli-occupied West Bank, meaning it could close them down and arrest their leaders. (A sixth had already been banned previously). The move came after Israel designated them as terrorist groups last month.

On Monday, cyber researchers said Israeli-made spyware from NSO Group targeted three of those groups' activists.

On Tuesday, reflecting broad international concern, United Nations officials accused Israel of targeting human rights and humanitarian work with its ban.

And on Wednesday, an Israeli military court convicted a Spanish citizen affiliated with a separate Palestinian organization for secretly fundraising for a terrorist movement which Israel alleges the six banned Palestinian activist groups are closely linked with.

The U.S. had already voiced its surprise at Israel's move to ban the groups, which include internationally regarded civil society organizations. Israel says it has shared intelligence with U.S. and European officials, but that does not appear to have quelled their concerns that Palestinian human rights activists were deemed a threat.

Israel is trying to convince some European countries to stop funding the Palestinian groups.

"We will make sure these organizations will not get money," an Israeli security official said, speaking on condition of anonymity because Israel prohibits certain security operatives from identifying themselves.

The alleged involvement of NSO — which the U.S. sanctioned this month for equipping states with tools to spy on activists around the world — could further complicate Israel's campaign to ostracize the Palestinian groups.

Many of the Palestinian groups have worked for years with European countries and the U.N.

The most prominent of the newly outlawed civil society groups is Al-Haq, founded in 1979, which documents abuses against Palestinian civilians allegedly committed by both Israel and Palestinian officials.

The others are Addameer, a Palestinian prisoner rights group, Defense for Children International - Palestine, which promotes children's rights, the Bisan Center for Research and Development, promoting socioeconomic development, the Union of Palestinian Women's Committees and the Union of Agricultural Work Committees.

The United Nations, major European countries and aid groups have partnered with many of these groups and provided them direct government funding.

All the groups deny Israel's claims they are linked to terrorism, and Israeli human rights groups have come to their defense.

"If you have evidence, come and present it," says Tahseen Elayyan of Al-Haq. He alleges that Israel is pursuing Al-Haq because of its work preparing Palestinian claims against Israel in the International Criminal Court.

Israel says the six Palestinian groups' leaders run a terrorist movement

Israel is not currently pursuing arrests of the Palestinian organizations' leaders. Its goal for now is to convince European countries to stop funding them or else Israel will seize the money, an Israeli security official told NPR and two other media outlets in a briefing on Monday.

Israel alleges the groups' directors constitute the secret leadership of the Popular Front for the Liberation of Palestine in the West Bank, a Marxist political movement founded in the 1960s that opposed the Oslo peace accords between Israel and the Palestinians. Its military wing has carried out deadly attacks against Israelis. The U.S. and European Union classify the PFLP as a terrorist organization.

"In order to break the spine of the PFLP, we need to deal with these six organizations," the Israeli official says.

He believes the six groups diverted more than half of their international funding to the PFLP. He did not provide NPR evidence to back his claims, saying it was classified.

The Israeli government says Wednesday's conviction of the Spanish citizen for secret PFLP fundraising adds further proof to its claims about the six organizations. But Israeli human rights lawyer Michael Sfard called it "complete spin," because the defendant did not work for the six organizations and did not reference them in her plea bargain.

Israel lobbied European countries in May to stop funding the groups

Israel's move is part of a wider campaign against the PFLP, following a deadly 2019 bombing. The Israeli security official claims the militants responsible for the bombing, which killed an Israeli teenage girl, met in the offices of the Union of Agricultural Work Committees and the organization helped fund the attack. He did not provide evidence.

Israel's Shin Bet domestic security agency outlined its case against the six organizations in a classified 74-page document presented to European countries in May. The document — first reported by Israeli news site +972, its Hebrew affiliate Local Call and the Intercept — quotes two Palestinian detainees who did not work for the six groups, but who told Israeli interrogators the groups laundered PFLP money. NPR and other media outlets obtained the document.

Belgium and the Netherlands said the information Israel presented did not provide enough evidence that their donations were misappropriated. European funding to the organizations continued. The Netherlands had already suspended its funding of the Union of Agricultural Work Committees last year, pending an "external investigation" into possible links between the group and the PFLP.

Israel has since presented U.S. officials with unspecified additional sources of classified evidence identifying the heads of these six groups as the top leadership of the PFLP in the West Bank, and is working to provide additional evidence to European donors, the Israeli official says.

How is NSO supposedly involved?

NSO Group is a private Israeli surveillance technology company whose signature Pegasus malware can infiltrate cellphones. NSO says it sells Pegasus to governments only to spy on terrorists and criminals, but it is accused of selling it to governments that used it to target activists, journalists and government officials around the world.

Last month, a researcher from the Palestinian rights group Al-Haq noticed something suspicious on his iPhone, and international hacking experts determined it was infected with Pegasus. They determined the same for five other Palestinian activists' phones.

It marks the first documented use of NSO spyware against Palestinians. Israel's Shin Bet would not confirm the spyware was used in its campaign against the Palestinian organizations.

The new U.S. sanctions against NSO threaten to cripple the company's ability to continue its global spyware sales. The New York Times reports Israel intends to lobby the U.S. to reverse its sanctions, promising tighter oversight over NSO.

European donors are considering how to respond to Israel's allegations

A Christian charity from Finland stopped funding one of the six outlawed Palestinian groups following Israel's terror designation last month. It said it found no misappropriation of funds, but is concerned it could face sanctions by international banks.

The Dutch foreign ministry tells NPR the Netherlands continues funding two groups on Israel's banned list while it waits for Israel to share its findings.

The Norwegian Refugee Council's Itay Epshtain, an international law consultant who is advising European donors on how to respond to Israel's move, says European donor countries regularly audit the Palestinian groups to ensure money is not misappropriated, and no donor has found evidence of wrongdoing. The European countries are now working in tandem to decide how to respond to Israel's move, he says.

"As far as I know, states have not terminated their relationships with these organizations" following Israel's recent terrorist designation, Epshtain says. "These six organizations are bonafide human rights organizations that do valuable, credible, reputable work. There is no question in my mind that is the case."

Israel's aim, he alleges, was to limit the groups' freedom of speech and human rights monitoring.

"It's being disingenuous attributing that to terrorism," Epshtain says.

Sami Sockol contributed to this story from Jerusalem.